DRAFT RED HERRING PROSPECTUSPlease read Section 60B of the Companies Act, 1956

Dated: May 16, 2006(To be updated upon RoC filing)

100% Book Building Issue

INDO ASIA LEISURE SERVICES LIMITED(Originally Incorporated as Indo Asia Tours Private Limited on May 2, 1988 vide registration no. 55-31449 issued by Registrar of Companies, N.C.T Delhi & Haryana, under theprovisions of the Companies Act, 1956. The name of the Company was changed to Indo Asia Leisure Services Private Limited vide fresh Certificate consequent to change in namedated September 23, 2005. The Company was converted from Private Limited to Public Limited Company under the provisions of section 44 of the Companies Act, 1956 w.e.f.October 19, 2005 and accordingly the name of the Company was changed to Indo Asia Leisure Services Limited. For details of changes in the address of the registered office,please refer to page no. 68 of this Draft Red Herring Prospectus)

Registered Office: C-28, Housing Society South Extension Part- I, New Delhi-110049, India.Tel No.: +91 11 24691733, 24691744, 24693574; Fax No: +91 11 24620533, 24628596

Website: www.indoasia-tours.com; E-mail: indoasia@vsnl.comContact Person: Mr. Bhupinder Kumar, Company Secretary and Compliance Officer

PUBLIC ISSUE OF 85,72,000 EQUITY SHARES OF FACE VALUE RS.10/- EACH OF INDO ASIA LEISURE SERVICES LIMITED (HEREAFTER REFERREDTO AS THE “COMPANY” OR “ISSUER”) AT A PRICE OF RS. [l] PER EQUITY SHARE FOR CASH AT A PREMIUM OF RS. [l] AGGREGATING TO RS. [l]LACS (HEREIN REFERRED TO AS THE “ISSUE”). THE FACE VALUE OF THE EQUITY SHARES IS RS. 10/- THE ISSUE WILL CONSTITUTE 48.78% OFTHE FULLY DILUTED POST ISSUE PAID UP CAPITAL OF THE COMPANY

PRICE BAND RS. [l] TO RS. [l] PER EQUITY SHARE OF FACE VALUE RS.10 EACH

ISSUE PRICE OF EQUITY SHARES IS [l] TIMES OF THE FACE VALUE AT THE LOWER END OF THE PRICE BAND AND [l] TIMES OF THE FACE VALUEAT THE HIGHER END OF THE PRICE BAND.

In case of revision in the Price Band, the Bidding/Issue Period will be extended for three additional working days after revision of the Price Band subject to the Bidding/Issue Period not exceeding 10 working days. Any revision in the Price Band and the revised Bidding/Issue Period, if applicable, will be widely disseminated by notificationto The Bombay Stock Exchange Limited (“BSE”) and National Stock Exchange (“NSE”) by issuing a press release, and also by indicating the change on the websites ofthe Book Running Lead Managers and at the terminals of the Syndicate.

This issue is being made through 100% Book Building Process wherein up to 50% of the issue shall be allocated on a proportionate basis to Qualified InstitutionalBuyers (“QIBs”). Out of the portion available for allocation to the QIBs, 5% shall be available for allocation on proportionate basis to Mutual Funds and the remainingQIB portion shall be available for allocation on proportionate basis to all QIBs, including Mutual Funds subject to valid bids being received at or above the Issue Price.Further, not less than 15% of the Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 35% of the Issue shall beavailable for allocation on a proportionate basis to Retail Individual Bidders, subject to valid bids being received at or above the issue price.

RISKS IN RELATION TO THE FIRST ISSUE

This being the first issue of the Equity Shares of the Company, there has been no formal market for the Equity Shares of the company. The face value of the shares is Rs. 10/-per Equity Share and the issue price is [l] times of the face value. The issue price (as determined by the Company, in consultation with the Book Running Lead Manager(“BRLM”) and the Co-Book Running Lead Manager (“Co-BRLM”), on the basis of assessment of market demand for the Equity Shares by way of book building, shouldnot be taken to be indicative of the market price of the equity shares after the shares are listed. No assurance can be given regarding an active and/or sustained trading inthe Equity Shares of the company or regarding the price at which the Equity Shares will be traded after listing.

GENERAL RISKS

Investment in equity and equity- related securities involve a degree of risk and investors should not invest any funds in this issue unless they can afford to take the risk oflosing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this Issue. For taking an investment decision, investorsmust rely on their own examination of the issuer and this issue including the risks involved. The Equity Shares issued in this issue have not been recommended or approvedby the Securities and Exchange Board of India (“SEBI”), nor does SEBI guarantee the accuracy or adequacy of this Draft Red Herring Prospectus. Specific attention of theinvestors is invited to the statements in Risk Factors beginning on Page No. ix of this Draft Red Herring Prospectus.

ISSUER’S ABSOLUTE RESPONSIBILITY

The Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Draft Red Herring Prospectus contains all information with regard to theIssuer and this issue, which is material in the context of this issue, that the information contained in this Draft Red Herring Prospectus is true and correct in all materialaspects 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 ofwhich makes this Draft Red Herring Prospectus as a whole or any of such information or the expression of any such opinions or intentions misleading in any materialrespect.

LISTING ARRANGEMENTS

The Equity Shares issued through this Draft Red Herring Prospectus are proposed to be listed on Bombay Stock Exchange Ltd. (BSE) and The National Stock Exchange ofIndia Ltd. (NSE). In-principle approval for listing of the Equity Shares of our Company from BSE and NSE has been received vide their letters dated [l] and [l]. For thepurpose of this issue, the Designated Stock Exchange is BSE.

BOOK RUNNING LEAD MANAGER REGISTRAR TO THE ISSUE

ISSUE PROGRAMMEISSUE OPENS ON : [l] 2006 ISSUE CLOSES ON : [l] 2006

IDBI Capital Market Services Limited5th Floor, Mafatlal CentreMumbai– 400 021Tel.: +91 22 5637 1212;Fax: +91 22 2288 5850.Website: www.idbicapital.comE-Mail: indoasia@idbicapital.com

Intime Spectrum Registry LimitedC-13, Pannalal Silk Mills Compound,LBS Marg, Bhandup (West)Mumbai – 400 078.Tel.: +91 22 25960320;Fax: +91 22 2596 0329Website: www.intimespectrum.comE-Mail: indoasia@intimespectrum.com

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TABLE OF CONTENTS CONTENTS PAGE NO. SECTION I – DEFINITIONS AND ABBREVIATIONS CONVENTIONAL/GENERAL TERMS i ISSUE RELATED TERMS ii INDUSTRY/COMPANY RELATED TERMS v ABBREVIATIONS vi SECTION II – RISK FACTORS CERTAIN CONVENTIONS – USE OF MARKET DATA vii FORWARD LOOKING STATEMENTS viii RISK FACTORS ix SECTION III – INTRODUCTION SUMMARY 1 THE ISSUE 6 GENERAL INFORMATION 7 CAPITAL STRUCTURE 15 OBJECTS OF THE ISSUE 22 ISSUE STRUCTURE 31 BASIS OF ISSUE PRICE 34 STATEMENT OF TAX BENEFITS 37 SECTION IV – ABOUT OUR COMPANY INDUSTRY OVERVIEW 42 BUSINESS OVERVIEW 52 REGULATIONS AND POLICIES 66 HISTORY AND CORPORATE STRUCTURE 67 OUR MANAGEMENT 70 OUR PROMOTERS AND THEIR BACKGROUND 81 RELATED PARTY TRANSACTIONS 84 CURRENCY OF PRESENTATION 85 DIVIDEND POLICY 86 SECTION V – FINANCIAL STATEMENTS AUDITORS’ REPORT 87 GROUP COMPANIES 119 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL 128 CONDITIONS AND RESULTS OF OPERATION SECTION VI – LEGAL AND REGULATORY INFORMATION OUTSTANDING LITIGATIONS, MATERIAL DEVELOPMENTS AND 142 OTHER DISCLOSURES GOVERNMENT/STATUTORY AND BUSINESS APPROVALS 145 OTHER REGULATORY AND STATUTORY DISCLOSURES 148 SECTION VII – ISSUE RELATED INFORMATION TERMS OF THE ISSUE 156 ISSUE PROCEDURE 159 SECTION VIII – MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION OF OUR COMPANY 182 SECTION IX – OTHER INFORMATION MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION 200 DECLARATION 202

SECTION I – DEFINITIONS AND ABBREVIATIONS DEFINITIONS CONVENTIONAL/GENERAL TERMS “IALS” or “Indo Asia” or “we” or “us” or “our” or “Company” unless the context otherwise requires, refers to Indo Asia Leisure Services Limited, a public limited company incorporated under the provisions of the Companies Act, 1956 with its registered office at C-28, Housing Society South Extension Part- I, New Delhi –1100 49, India.

Term Description Articles/Articles of Association/ AoA

Articles of Association of our Company

Auditors The statutory auditors of the Company: SNR & Co, Chartered Accountants Board of Directors The Board of Directors of the Company or a committee thereof Companies Act The Companies Act, 1956, as amended from time to time and the regulations framed there

under Depositories Act The Depositories Act, 1996, as amended from time to time Depository Participant

A depository participant as defined under the Depositories Act

Director(s) Director(s) of the Company unless otherwise specified Equity Shares Equity shares of the Company of face value of Rs. 10/- each unless otherwise specified in

the context thereof Face Value Face Value of equity shares of our Company being Rs. 10/- each FEMA Foreign Exchange Management Act, 1999 as amended from time to time and the regulations

framed there under Financial Year/Fiscal/FY

Period of twelve months ended March 31 of that particular year

I.T. Act The Income Tax Act, 1961, as amended from time to time and the regulations framed there under

Memorandum/ Memorandum of Association /MoA

The Memorandum of Association of our Company

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ISSUE RELATED TERMS

Term Description Allotment Unless the context otherwise requires, issue of equity shares pursuant to this Issue Allottee The successful Bidder to whom the Equity Shares are being / or have been issued or

transferred. Banker(s) to the Issue

[•]

Bid An indication to offer made during the Bidding Period by a prospective investor to subscribe to Equity Shares of the Company at a price within the Price Band, including all revisions and modifications thereto

Bid Amount The highest value of the optional Bids indicated in the Bid cum Application Form and payable by the Bidder on submission of the Bid in the Issue

Bid Closing Date/ Issue Closing Date

The date after which the members of the Syndicate will not accept any Bids for the Issue, which shall be notified in a widely circulated English national newspaper and Hindi national newspaper

Bid cum Application Form

The form in terms of which the Bidder shall make an offer to purchase the Equity Shares of the Company and which will be considered as the application for allotment of the Equity Shares in terms of this Draft Red Herring Prospectus

Bid Opening Date/Issue Opening Date

The date on which the members of the Syndicate shall start accepting Bids for the Issue, which shall be the date notified in an English national newspaper and a Hindi national newspaper.

Bidder Any prospective investor who makes a Bid pursuant to the terms of this Draft Red Herring Prospectus

Bidding Period/Issue Period

The period between the Bid/Issue Opening Date and the Bid/Issue Closing Date inclusive of both days and during which prospective Bidders can submit their Bids

Book Building Process

Book building route as provided under Chapter XI of the SEBI Guidelines, in terms of which the Issue is made

BRLMs Book Running Lead Managers to the Issue, in this case being IDBI Capital Market Services Limited having its registered office at 5th Floor, Mafatlal Centre, Nariman Point, Mumbai – 400 021 and Chartered Capital And Investments Limited having its registered office at 13, Community Centre, East of Kailash, New Delhi- 110 001

BSE Bombay Stock Exchange Limited CAN/Confirmation of Allocation Note

Means the note or advice or intimation of allocation of Equity Shares sent to the Bidders who have been allocated Equity Shares in the Book Building Process

Cap Price The higher end of the Price Band, above which the Issue Price will not be finalized and above which no Bids will be accepted.

Compliance Officer In this case being Mr. Bhupinder Kumar, our Company Secretary Co- BRLM Chartered Capital And Investments Limited Cut-off price Cut-off price refers to any price within the Price Band. A Bid submitted at Cut-off price is a

valid Bid at all price levels within the Price Band Chartered Capital Chartered Capital and Investments Limited

Depository A depository registered with SEBI under the SEBI (Depositories and Participant) Regulations, 1996, as amended from time to time

Designated Date The date on which funds are transferred from the Escrow Account of the Company to the Public Issue Account after the Prospectus is filed with the RoC, following which the Board of Directors shall allot Equity Shares to successful bidders

Designated Stock Exchange

Designated Stock Exchange shall mean Bombay Stock Exchange Limited.

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Draft Red Herring Prospectus

Means this Draft Red Herring Prospectus issued in accordance with Section 60B of the Companies Act, which does not have complete particulars on the price at which the Equity Shares are offered and size of the Issue. It carries the same obligations as are applicable in case of a Prospectus and will be filed with the RoC at least three days before the opening of the Issue. It will become a Prospectus After filing with the RoC after the pricing and allocation

Escrow Account Account opened with an Escrow Collection Bank(s) and in whose favour the Bidder will issue cheque or draft in respect of the Bid Amount when submitting a Bid

Escrow Agreement Agreement entered into amongst the Company, the Registrar, the Escrow Collection Bank(s) and the BRLMs for collection of the Bid Amounts and refunds (if any) of the amounts collected to the Bidders

Escrow Collection Bank(s)

The Banks at which the Escrow Account of the Company will be opened. In this case being [•]

FEMA Foreign Exchange Management Act, 1999, as amended from time to time and the regulations framed thereunder.

FIPB Foreign Investment Promotion Board, Ministry of Finance, Government of India FII Foreign Institutional Investor (as defined under SEBI (Foreign Institutional Investors)

Regulations, 1995) registered with SEBI under applicable laws in India First Bidder The Bidder whose name appears first in the Bid cum Application Form or Revision Form Floor Price The lower end of the Price Band, below which the Issue Price will not be finalized and

below which no Bids will be accepted IDBI Capital IDBI Capital Market Services Limited Indian GAAP Generally Accepted Accounting Principles in India IPO Initial Public Offer Issue/Offer The fresh issue of 85,72,000 new Equity Shares of Rs. 10/- each at the Issue Price by the

Company under this Draft Red Herring Prospectus Issue Price The final price at which Equity Shares will be issued and allotted in terms of the Draft Red

Herring Prospectus. The Issue Price will be decided by the Company in consultation with the BRLMs on the Pricing Date

Margin Amount The amount paid by the Bidder at the time of submission of his/her Bid, being 10% to 100% of the Bid Amount

Non Institutional Bidders

All Bidders that are not QIBs or Retail Individual Bidders and whose Bid Amount is more than Rs. 1,00,000/-.

Non Institutional Portion

The portion of the Issue being atleast 15% of the Issue i.e. 12,85,800 Equity Shares of Rs. 10/- each available for allocation to Non Institutional Bidders

Non Resident/ NRI / Non-Resident Indian

A person resident outside India, as defined under FEMA and who is a citizen of India or a Person of Indian Origin under FEMA (Transfer or Offer of Security by a Person Resident Outside India) Regulations, 2000

NSE National Stock Exchange Pay-in Date The last date specified in the CAN sent to Bidders. Pay-in-Period This term means (i) with respect to Bidders whose Margin Amount is 100% of the Bid

Amount, the period commencing on the Bid Opening Date and extending until The Bid Closing Date, and (ii) with respect to Bidders whose Margin Amount is less than 100% of the Bid Amount, the period commencing on the Bid Opening Date and extending until the closure of the Pay-in Date

Permanent Employees

Permanent Employees of our Company as on date of filing this Draft Red Herring Prospectus

Price Band Being the price band of a minimum price (Floor Price) of Rs. [•] and the maximum price (Cap Price) of Rs. [•] and includes revisions thereof

Pricing Date The date on which the Company in consultation with the BRLMs finalizes the Issue Price

Promoters Promoters of Indo Asia Leisure Services Limited being Mr. Sunirmol Ghosh, Mr. Sudesh

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Behal and Mr. Gajendra Singh Panwar. Prospectus The Prospectus, filed with the RoC containing, inter alia, the Issue Price that is determined

at the end of the Book Building Process, the size of the Issue and certain other information

Public 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

Qualified Institutional Buyers/QIBs

Public financial institutions as specified in Section 4A of the Companies Act, foreign institutional investors, scheduled commercial banks, mutual funds registered with SEBI, multilateral and bilateral development financial institutions, venture capital funds registered with SEBI, foreign venture capital investors registered with SEBI, state industrial development corporations, insurance companies registered with IRDA, provident funds and pension funds with a minimum corpus of Rs. 250 million

QIB Margin An amount representing 10% of the Bid amount

QIB Portion The portion of the Issue being upto 50% of the Issue i.e. 42,86,000 Equity Shares of Rs. 10/- each available for allocation to QIBs

Registered Office Registered Office of our Company situated at C-28, Housing Society South Extension Part – I, New Delhi-110049, India.

Registrar/Registrar to the Issue

Registrar to the Issue, in this case being Intime Spectrum Registry Limited.

Retail Bidders/Retail Individual Bidders/Retail Investors

Individual Bidders (including HUFs and NRIs) who have not Bid for an amount more than or equal to Rs. 1,00,000/- in any of the bidding options in the Issue

Retail Portion The portion of the Issue being atleast 35% of the Issue i.e. 30,00,200 Equity Shares of Rs. 10/- each available for allocation to Retail Bidder(s)

Revision Form The form used by the Bidders to modify the quantity of Equity Shares or the Bid Price in any of their Bid cum Application Forms or any previous Revision Form(s)

RoC/ROC Registrar of Companies, in this case being Registrar of Companies, N.C.T., Delhi & Haryana, CGO Complex, Paryavaran Bhavan, New Delhi.

Red Herring Prospectus

Means this Red Herring Prospectus issued in accordance with Section 60B of the Companies Act, which does not have complete particulars on the price at which the Equity Shares are offered and size of the Issue. The Red Herring prospectus will be filed with the RoC at least three days before the opening of the Issue. It will become a Prospectus after filing with the RoC after the pricing and allocation

SEBI The Securities and Exchange Board of India constituted under the SEBI Act SEBI Act Securities and Exchange Board of India Act, 1992, as amended from time to time SEBI Guidelines SEBI (Disclosure and Investor Protection) Guidelines, 2000 issued by SEBI on January 27,

2000, as amended, including instructions and clarifications issued by SEBI from time to time.

Stock Exchange BSE & NSE Syndicate/Members of the Syndicate

The BRLMs and Syndicate Members

Syndicate Agreement The agreement to be entered into between the Company and the members of the Syndicate, in relation to the collection of Bids in this Issue

Syndicate Members Intermediaries registered with SEBI and eligible to act as underwriters. Syndicate Members are appointed by the BRLMs. In this case being [•]

TRS or Transaction Registration Slip

The slip or document issued by the members of the Syndicate to the Bidder as proof of registration of the Bid

Underwriters Underwriters to this Issue Underwriting Agreement

The Agreement among the Underwriters and the Company to be entered into on or after the Pricing Date

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INDUSTRY/COMPANY RELATED TERMS Term Description API A set of routine that an application uses to request and carry low level services performed by

a Computer Operating System. ARR Average Room Rental calculated by dividing the total room revenue by the number of rooms

occupied. AS Accounting Standard BPO Business Process outsourcing CRS Central Reservation System CRM Customer Relationship Management CSU Channel Service Units CTI Computer telephony integration DOT Department of Tourism E –11 Customer Recognition Software by E-11 Online.Com E- Commerce Electronic Commerce F&B Food and Beverage FHRAI Federation of Hotel & Restaurant Association of India FIFO First in First out FIT Free individual Traveller GDP Gross Domestic Products HRACC Hotel and Restaurant Approval and Classification Committee IPLC Internet Protocol Leased Line ITDC India Tourism Development Corporation IVR Interactive Voice Response KBPS Kilo Bite per Second MAT Minimum Alternate Tax MIS Management Information System MOT Ministry of Tourism NCT National Capital Territory Occupancy Total number of rooms occupied divided by the total number of rooms available TFCI Tourism Finance Corporation of India TRS Transaction registration slip UPS Uninterrupted Power Supply UKAS United Kingdom Accreditation Services URS United Registrar Systems USP Unique Selling Proposition UK United Kingdom WTTC World Travel & Tourism Council

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ABBREVIATIONS

Abbreviation Full Form AGM Annual General Meeting AS Accounting Standards as issued by the Institute of Chartered Accountants of India CAGR Compounded Annual Growth Rate CDSL Central Depository Services (India) Limited D/E Ratio Debt Equity Ratio DP Depository Participant DIN Directors identification number DRHP Draft Red Herring Prospectus EBDITA Earnings Before Depreciation, Interest, Tax and Amortization EPS Earnings Per Equity Share FCNR Account Foreign Currency Non Resident Account FI/FI(s) Financial Institution(s) FIIs Foreign Institutional Investor (as defined under Foreign Exchange Management (Transfer or

Issue of Security by a Person Resident outside India) Regulations, 2000) registered with SEBI under applicable laws in India

FY / Fiscal Financial Year ending March 31 GoI/Govt. Government of India ISO International Standard Organization HUF Hindu Undivided Family INR/ Rs. Indian National Rupee IPO Initial Public Offering MoU/MOU Memorandum of Understanding NAV Net Asset Value NRE Account Non Resident External Account NRO Account Non Resident Ordinary Account NSDL National Securities Depositories Limited PAN Permanent Account Number p.a. per annum P/E Ratio Price/Earnings Ratio RoNW Return on Net Worth RBI The Reserve Bank of India constituted under RBI Act RBI Act The Reserve Bank of India Act, 1934 as amended from time to time. U.S./U.S.A. United State of America

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SECTION II – RISK FACTORS

CERTAIN CONVENTIONS – USE OF MARKET DATA

In this Draft Red Herring Prospectus, unless the context otherwise requires, unless stated otherwise, the financial data in this Draft Red Herring Prospectus is derived from our financial statements prepared and restated in accordance with Indian GAAP, the Companies Act and SEBI Guidelines included elsewhere in this Draft Red Herring Prospectus. In this Draft Red Herring Prospectus, any discrepancies in any table between the total and the sums of the amounts listed are due to rounding-off. In this Draft Red Herring Prospectus, unless the context otherwise requires, all references to one gender also refers to another gender and the word “lacs” means “one hundred thousand” and the word “million” means “ten lac” and the word “Crore” means “ten million”. Throughout this Draft Red Herring Prospectus, all figures have been expressed in lacs. Unless otherwise stated, all references to “India” contained in this Draft Red Herring Prospectus are to the Republic of India. Industry data used throughout this Draft Red Herring Prospectus has been obtained from industry publications and other authenticated published data. Industry publications generally state that the information contained in those publications has been obtained from sources believed to be reliable but that their accuracy and completeness are not guaranteed and their reliability cannot be assured. Although we believe that industry data used in this Draft Red Herring Prospectus is reliable, it has not been independently verified. Similarly, internal Company reports, while believed by us to be reliable, have not been verified by any independent sources For additional definitions, please refer to the section titled ‘Definitions and Abbreviations’ on page no. i of this Draft Red Herring Prospectus. In the section titled ‘Main Provisions of the Articles of Association’ on page no. 182 of this Draft Red Herring Prospectus, defined terms have the meaning given to such terms in the Articles of Association of our Company.

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FORWARD LOOKING STATEMENTS We have included statements in this Draft Red Herring Prospectus which contain words or phrases such as “will”, “aim”, “will likely result”, “believe”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “future”, “objective”, “goal”, “project”, “should”, “will pursue” and similar expressions or variations of such expressions, 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:

Our ability to successfully implement our growth strategy and expansion plans, and to successfully launch various projects for which funds are being raised through this Issue;

•

• • • • •

The monetary and fiscal policies of India; General economic and business conditions in India; Changes in political and social conditions in India; Changes in laws and regulations relating to the industry in which we operate; Any adverse outcome in the legal proceedings in which our Company is involved; and

For further discussion of factors that could cause our actual results to differ, please refer to the section titled ‘Risk Factors’ beginning from page no. ix of this Draft Red Herring Prospectus. 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. Neither our Company nor the members of the Syndicate, nor any of their respective 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 and the BRLMs will ensure that investors in India are informed of material developments until the grant of listing and trading permission by the Stock Exchanges for the Equity Shares allotted pursuant to this Issue.

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RISK FACTORS An investment in Equity Shares involves a high degree of risk. The investor should carefully consider all of the information provided in this Draft Red Herring Prospectus, including the risks and uncertainties described below, before making an investment in the Company’s Equity Shares. If any of the following risks actually occur, Company’s business, results of operations and financial condition could suffer, the trading price of the Company’s Equity Shares could decline and the investors may lose all or part of their investment. Note: The risk factors are as envisaged by the management along with the proposals to address the risk if any. 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 risks mentioned herein under: In this Draft Red Herring Prospectus, any discrepancies in any table between total and the sums of the amount listed are due to rounding off. Any percentage amounts, as set forth in “Risk Factors”, “Management’s discussion and analysis of financial condition and results of operations” and elsewhere in this Draft Red Herring Prospectus, unless otherwise indicated, have been calculated on the basis of the amounts disclosed in the financial statements prepared in accordance with the Indian Accounting Standards. A. INTERNAL RISK FACTORS i). Risks related to the Company 1. There is one winding up petition filed against our Company by RGR Transport Private Limited, u/s 434 of

the Companies Act, 1956, in the Hon’ble High Court of Delhi.

M/s RGR Transport Private Limited (“RGR”) has filed one winding up petition against our company in the Hon’ble High Court of Delhi vide Petition No.419/1998 alleging that an amount of Rs.3,63,660/- (Rs.4,85,944 along with taxes) was outstanding from our Company and that we despite admission of the claim and repeated reminders from RGR, have failed to make the payment. The case is presently pending for adjudication. We can be asked to pay the amount claimed by M/s RGR Transport Pvt. Ltd in its petition i.e. Rs 4,85,944/- During the course of proceedings the Hon’ble High Court of Delhi, by way of interim measure directed our Company to deposit a sum of Rs 2,11,232/- in the court, which we have complied with.

2. There is a litigation involving Labour Laws filed against our Company in the Labour Court – IV,

Karkardooma Courts, New Delhi.

The Government of Delhi has made a reference to the Labour Court in a industrial dispute concerning our Company and a driver namely Mr. Sat Dev, who has claimed that he was in service of our Company from the period 05.12.1993 to 18.12.1996 and that his services were illegally terminated. He has claimed reinstatement of services with back wages from our Company. An ex-parte award has been issued against our Company by the Labour Court on 10.01.2002, directing us to reinstate the driver with past benefits. Against this order an application on behalf of our Company under Order 9 Rule 7 was filed for setting aside the ex-parte award on the ground that our Company never received notice from the Hon’ble Labour Court and also that the driver was never in the employment of our Company. The Hon’ble Labour Court allowed the said application of our Company on the condition that we shall deposit 100% of the awarded amount and subject to the payment of Rs. 15,000/- to the workman driver. Our company filed a writ petition against the order of the Hon’ble Labour Court, in the Delhi High Court requesting for being allowed to furnish a Bank Guarantee for the awarded amount instead of the 100% deposit. The Hon’ble Delhi High Court allowed the request of our Company and accordingly a bank guarantee for Rs.1,95,629/- was furnished to the Labour Court through Bank of Maharashtra, South Extension Part-1, New Delhi. Further, an amount of Rs 15,000/- as cost was also paid to the workman in compliance with the order of the Hon’ble Labour Court as cost. The dispute is still pending adjudication.

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3. There is one dispute pending regarding settlement of Accounts with one of the shareholder/erstwhile director

of our company.

In late 1996, there developed some differences between two groups of Directors of our Company- one group (Group A) comprising of Mr. Radhey K. Gupta, Mr. Prem Chand and Mr. Sushil Gupta, while the other group (Group B) comprising of Mr. Sudesh Behal, Mr. Sunirmol Ghosh and Mr. Gajendra S. Panwar. In November 1996, it was decided to separate the various businesses carried on by the two groups and a resolution to this effect was passed by the Board of Directors of our Company in its meeting held on 2nd November 1996. Both the groups reached a settlement and signed a MOU to that effect on 02.11.1996 referring to the respective valuations for the different business operated by the groups and the separation of business among the two groups. Any matter not mentioned in the MOU was agreed to be referred to the Arbitrators named in the resolution namely Mr. Bharat Bhushan, Mr. Suresh Vyas and Mr. R.K. Pathak. The Arbitrators were supposed to amicably settle any differences between the two groups and their award was agreed to be final and biding on all the directors.

The contentious issues pertaining to various business of both the groups were referred to the Arbitrators for resolution. When all conciliation proceeding failed, the Arbitration proceedings were initiated in September 1997. The Company (Group B) on 22nd August 2003 filed a statement of claim of Rs. 68,42,965/- against Group A after deducting an amount of Rs 5,54,021/- payable to Group A. In its reply to the statement of claim of Group B, Group A denied its liability to pay the amount claimed. Instead, Group A filed a counter claim stating therein that a sum of Rs. 53.98 Crores (which comprised of claim amount of Rs.15.34 Crores and interest @15%p.a. on the claim amount from 1995-96 onwards amounting to Rs.38.64 Crores), is due and recoverable from Group B. Group B has refuted all claims/counter claims raised by group A. The Arbitral Tribunal after observing non-cooperation between the groups and also on the ground that the parties are not serious dissolved the Arbitral Tribunal on June 22, 2005. Thereafter, none of the parties have taken further action to resolve the differences with regard to finalization of accounts. No arbitration or other proceedings have been launched by either group against the other. As of date no legal proceedings either before an Arbitral Tribunal or a court of law arising out of or related to the MOU stated above are pending adjudication.

It is pertinent to mention here that the financials of our Company continue to reflect the assets handed over to Group A as per the settlement dated 2nd November 1996. The management is in the process of writing off these assets since these are no longer in possession of control of the Company. The value of the assets as on 31.03.2006, after providing for depreciation is Rs. 13,00,810/-

ii). Risks related to the business 4. We have group companies/firms which have activities similar to those carried out by our Company. There

may be conflict of interest between business carried by us and our group companies/firms. For details of our group companies/firms please refer to page no. 119 of this Draft Red Herring Prospectus.

Management Perception: We have 8 group companies and one partnership firm who have activities similar to those carried out by our company. Out of these 4 companies (Indo Asia Tours & Travels, Holiday Mall.Com Pvt. Ltd, Indo Asia Hotels Pvt. Ltd. and Coorg Hotels Pvt. Ltd.) are non- operative and have not carried on any business activity since inception. Further one group company, Transasia Travelnet has only income from lease, which is not our main activity. The business of another group Company Indo Asia International Ltd. has already been transferred to our company as part of group reorganization and consolidation. Carnival Hotels is mainly into marketing and management of hotels which is not exactly competitive to our business. Heritage Inn Pvt. Ltd. is owning hotel at Jaisalmer where we neither own nor currently propose to acquire new hotel. ‘Hotel Hatty’, the partnership firm has a hotel in Coorg where we propose to take over a resort property on long term lease. The clientele for hotels and resorts are different. Hence there is no conflict of interest between business carried on by our group company and that by us.

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5. Our Sundry debtors include an amount of Rs.1 Crore outstanding from our clients for more than 3 years. The

same has not been provided for in the Audited Financial statements prepared for these years.

Management Perception: The amounts are outstanding from some of our principal agents abroad (about 70% of the total outstanding) and balance from one local party in India, pending some reconciliation of accounts. Our company is in the process of completing the reconciliation and recovering the said receivables.

6. We have Contingent liability of Rs.33.06 Lacs as on February 28, 2006, which is not provided for in the

Audited financial statements prepared as on that date.

We have contingent liability of Rs.33.06 Lacs as on February 28, 2006, which is not provided for in the Audited financial statements prepared as on that date. This includes Rs.7.5 Lacs Bank Guarantees executed favouring various hotels for room bookings in the normal course of business. Further bank guarantees amounting to Rs.25.56 Lacs have been executed by our company in favour of Cutoms and others for import of vehicles at concessional duties under EPCG.

7. We have obligation to safeguard the business interest of the overseas principal agents and any sub-

performance/non-performance on our part could result into high retentions and refunds, which may affect the profitability of our company.

We operate through a network of agents spread across the globe. We arrange for travel, accommodation, sightseeing etc. for the clients booking through these overseas agents. We have a obligation towards our principal agent to safeguard their business interest. Any sub-performance/non-performance on our part could result into high retentions and refunds, which may affect the profitability of our company. Thus proper monitoring of execution of our business obligation, maintenance of backup support in case of any breakdown in the system etc. is important.

Management Perception: We have been in the tourism industry for the last 18 years. Over the years we have developed good business relationships with some of the leading tour operators abroad like GeBeCo – Germany, Djoser – Holland, Insight Reisen – Switzerland and Joe Far Reisen – Austria. We have been providing services to these tour operators for the last 9 years. We have been able to maintain good quality systems of work execution in the past.

8. We are largely dependant on our business associates, both in India and abroad for future travel bookings. Any

failure on their part to honour commitments may have a material adverse effect on our business, financial condition and operations.

Management Perception: We select our business associates carefully after examining their background, credibility, capability and ability to deliver quality and timely service. We work towards developing long term good relationship with our business associates, both in India and abroad to enable them to deliver according to our requirement.

9. We do not have escalation clauses in our agreements with our associates/intermediaries and consequently

during period of rising prices or any adverse change in tariffs by our business associates/intermediaries, we may not be able to pass price increases to our customers, which could harm our operational results and financial condition.

Management Perception: It is normal practice in the Travel and Tourism Industry to fix tariffs in advance for a calendar year. However, it is customary in our industry not to change the tariffs once offered.

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10. Attracting and retaining talented professionals is key to our business growth. Any inability on our part to attract and retain talented professionals or key managerial personnel may adversely affect our business and results of operations.

Management Perception: We have been successful in retaining our key Managerial Persons in the past. We encourage regular training, self development and professional work atmosphere to help our employees deliver the best.

11. We face risk relating to foreign exchange fluctuation as currently major part of our revenue come from foreign Inbound tourists visiting India.

We currently derive a majority of our revenue from Inbound Tourists i.e. foreign tourists coming to India. The payment is made in foreign currency. We do not have a risk management system to hedge the risk of foreign exchange fluctuations. Thus, any adverse fluctuation in the exchange rate between Rupee and other currencies may adversely affect our financial position and results of operations.

12. While we believe that our present facilities are in compliance with applicable laws and regulations. Any

changes in future may adversely affect working of the company. If we are not able to renew or maintain our statutory and regulatory permits and approvals required to operate our business it may have a material adverse effect on our business.

Management Perception: In the past, we have complied with the applicable laws and regulations, relevant to our business and propose to do the same in the future.

13. Our registered office at New Delhi and our branch offices at Bangalore, Chennai, Goa and Kolkata are on

leased premises.

Management Perception: The registered office of our Company is on premises leased from our promoters Mr. Sunirmol Ghosh and Mr. Sudesh Behal. Further, our branch offices at Bangalore and Chennai are owned by group Company/Promoters/ Promoter group. We do not see difficulty in renewing these lease. Our branch offices at Goa and Kolkata are on lease from outsiders. Our company is proposing to establish self owned Branch Offices in Goa and Kolkata which is part of the current expansion project. This would replace the above lease arrangement.

iii). Risks related to the expansion project 14. The funds requirements and funding plans for our expansion project are as per our own estimates and have

not been appraised by any bank/financial institution. The deployment of fund in the expansion plan is entirely at our discretion and the same will not be monitored by any independent agency.

Management Perception: Our Directors and Key Managerial Personnel have implemented various projects successfully in the past. Under their supervision our company has seen excellent growth in operations and won various awards and distinctions in its field. Hence, we do not foresee any difficulty in completing our expansion project and meeting implementation schedule.

15. Our expansion project, which we propose to finance out of the current Public Issue, involves taking on lease

properties owned by our promoters, their partnership firms.

As part of our expansion project, we propose to take a 3 Star Resort Property at Coorg (Karnataka) on long term lease from a partnership of which our promoters Mr. Sunirmol Ghosh and Mr. Sudesh Behal are the only partners. Our promoter would be interested to the extent of One time lease deposit of Rs.168.10 Lacs payable in respect of this property and subsequent lease rentals payable by our Company.

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iv). Other Incidental Risks 16. We have not registered our brand i.e. ‘Indo Asia’ and we do not have a registered trademark.

We have not yet registered the brand ‘Indo Asia’ in our name and do not have a registered trademark. This subjects us to the risk of imitation and loss of revenue owing to sub-standard services being rendered by others under our brand name.

Management Perception: We have already made an application for registration of our trademark with the Trade Mark Registry, Government of India at New Delhi.

17. Our Term loan with TFCI has certain restrictive covenants, which may affect the rights of equity

shareholders.

In respect to Term Loan agreement entered into by our Company with TFCI, we are bound by certain restrictive covenants regarding our capital structure. This includes convertibility option in the hands of TFCI, of the outstanding amount of debt into fully paid up equity shares of our company, in the event of our default in repayment of three consecutive instalments. The outstanding amount of TFCI as on February 28, 2006 is Rs. 80.18 Lacs. Pursuant to the aforesaid covenants, we have obtained NOC from TFCI with regard to the current issue.

18. We enjoy 5% interest subsidy on the Term Loan availed from Tourism Finance Corporation of India (TFCI). Failure to comply with the conditions of the Term Loan agreement entered into with TFCI shall make us ineligible for the said interest subsidy.

Management Perception: We are currently availing 5% interest subsidy from Department of Tourism in respect of Term Loan from TFCI. We have been regularly complying with the conditions of the Term Loan agreement with TFCI.

19. Some of our group/associate companies have incurred losses in recent fiscal periods.

Some of our group/associate companies have incurred losses as per their financial statements for the last three fiscal years ended March 31, 2005. The details of these losses are set out in the table below:

(Rs. In Lacs) Years Group/Associate Company

2004-05 2003-04 2002-03 Indo Asia International Private Limited - - (4.01) Carnival Hotel & Resorts Private Limited (1.35) - (2.14) Heritage Inn Private Limited - - (31.80)

20. Although we maintain key man insurance for some of our Directors, the loss of any of these Directors may

adversely affect our business and results of operations.

Our insurance policies consist of a comprehensive coverage for risks relating to physical loss or damage. In addition, we have obtained separate insurance coverage for personnel related risks, motor vehicle risks and loss of movable assets risks. For details of our insurance policies see the section titled “Our Business – Insurance” on page 52 of this Draft Red Herring Prospectus. While we believe that the insurance coverage we maintain would reasonably be adequate to cover all normal risks associated with the operation of our business, there can be no

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assurance that any claim under the insurance policies maintained by us will be honoured fully, in part or on time. To the extent that we suffer loss or damage that is not covered by insurance or exceeds our insurance coverage, or the insurance policy covering such risk is not honoured, our results of operations and cash flow may be adversely affected.

21. Members of our Promoter group will continue to retain majority control in our Company after the Issue, which

will allow them to influence the outcome of matters submitted to shareholders for approval. Upon completion of the Issue, members of our Promoter group will beneficially own approximately [ ]% of our post-Issue equity share capital. As a result, the Promoter group will have the ability to exercise influence over all matters requiring shareholders’ approval, including the election of Directors and approval of significant corporate transactions. As a consequence of its post-issue shareholding, the promoter group will also have the ability to influence the outcome of any shareholder action or approval requiring a majority vote, except where they are required by applicable laws to abstain from voting. Such a concentration of ownership may also have the effect of delaying, preventing or deterring a change in control.

B. EXTERNAL RISK FACTOR

1. Any slow down of economy of the countries from where we expect our customers for inbound tourism may have

a negative effect on the spending power of these consumers and consequently reducing their spend on travel. This may have adverse impact on the export earnings and results of operations.

2. Any change in Government policies, acts of war or geographical and social turmoil in countries of preference to Outbound Tourists may adversely effect the growth potential of our Outbound Tourist and consequently affect our operations, increase our cost and negatively effect our profitability.

3. Any slowdown in the growth of Indian economy could adversely affect the business of the Company, including future financial performance, shareholders’ funds and ability to implement strategy and the price of Company’s equity shares. Indian Economy performed satisfactory during the year 2004-05 with a GDP growth rate of 6.9%. This growth momentum has been very optimistic for the first half of 2005-06 with the GDP growth at around 8.1%.

4. Any significant change in the Government’s economic liberalization and deregulation policies could disrupt our business and adversely affect the financial performance of our Company.

The Government of India has traditionally exercised and continues to exercise a dominant influence over many aspects of the economy. Its economic policies had and could continue to have a significant effect on public & private sector entities, including our Company. Any significant change in the Government’s policies or any political instability in India could adversely affect the business and economic conditions in India and could also adversely affect the business, future financial performance and the price of our Company’s Equity Shares.

5. Central and State Governments in India have introduced various schemes to boost tourism. Any withdrawal of such schemes may affect our working.

There are certain incentives and concessions granted or provided by the Government of India or the applicable state governments that are currently being enjoyed by the hotel industry. There is no guarantee that such incentives or concessions will continue or will not be withdrawn by the Government of India or the applicable state governments in the future

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6. The price of our Equity Shares may be volatile.

The Equity Shares of our Company are currently not listed. The price of our Equity Shares on the Indian Stock Exchanges may fluctuate after listing as a result of several factors including –

• Volatility in Indian and global securities market; • Our results of operations and performance; • Performance of our competitors and perception in the Indian market about investment in the Tourism

Industry; • Adverse media reports, if any, on our Company or the Tourism Industry; • Changes in the estimates of our performance or recommendations by financial analysts; • Significant development in India’s economic liberalization and de-regulation policies; and • Significant development in India’s fiscal and environmental regulations.

There can also be no assurance that the price at which our equity shares are initially traded will correspond to the prices at which our Equity Shares will trade in the market subsequent to this Issue.

7. The Issue price of our Equity Shares may not be indicative of the market price of our Equity Shares after the

Issue.

The Issue Price of our Equity Shares will be determined by the Book Building Process. This price will be based on numerous factors (discussed in the section titled ‘Basis of Issue Price’ beginning from page no. 34 of this Draft Red Herring Prospectus) and may not be indicative of the market price for our Equity Shares after the Issue.

The market price of our Equity Shares could be subject to significant fluctuations after the Issue, and may decline below the Issue Price. We cannot assure the investors that they will be able to resell their Equity Shares at or above the Issue Price. Among the factors that could affect our share price are:

• Quarterly and other variations in the rate of growth of our financial indicators, such as earnings per share,

net income and revenues; • Changes in revenue or earnings estimates or publication of research reports by analysts; • Speculation in the press or investment community; • General market conditions; and • Domestic and international economic, legal and regulatory factors unrelated to our performance.

8. Certain factors beyond the control of our Company like terrorist attacks, Civil unrest, droughts, floods,

earthquakes, war etc. or any other acts of violence involving India and other countries can adversely affect our Company and financial markets, where the Equity Shares of our Company will be traded.

Certain events that are beyond our control such as the recent tsunami or seismically generated sea waves capable of considerable destruction on December 26, 2004 and terrorist attacks such as the ones that occurred in New York and Washington, D.C. on September 11, 2001 and New Delhi on December 13, 2001. The other acts of violence or war including civil unrest, military activity and hostilities among countries may adversely affect worldwide financial markets and could lead to economic recession. Our hotels, vehicles are vulnerable to man made and natural disasters such as explosions, earthquake, storms and floods as well as to terrorist attacks or other enemy actions. Any such event could adversely affect our financial performance or the market price of the equity shares.

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C. NOTES TO RISK FACTORS 1. Public Issue of 85,72,000 Equity Shares of Rs. 10/- each for cash at a price of Rs. [•] per Equity Share

aggregating to Rs. [•] Lacs. 2. The book value per Equity Share of Rs. 10/- was Rs. 15.18 as at March 31, 2005. The Book Value of the Shares

of our Company according to audited financials for the eleven months ended February 28, 2006 is Rs.19.34. 3. The average cost of acquisition of Equity Shares of face value of Rs. 10/- each by our Promoters, is as follows:

Name of the Promoter Average cost of acquisition of shares Mr. Sunirmol Ghosh Rs. 1.67/- per share Mr. Sudesh Behal Rs. 1.67/- per share Mr. Gajendra Singh Panwar Rs. 1.67/- per share

4. The net worth of the Company is Rs.1526.09 Lacs as on March 31, 2005 and Rs.1743.67 Lacs as on February

28, 2006, as per restated financial statements prepared by our auditors M/s SNR & Co. 5. Our Company has made a bonus issue of equity shares in the ratio of Five Equity Share for every One Equity

Share held as on the record date i.e. 31.03.2005. This bonus issue was made through capitalisation of free reserves. The allotment of these Equity Shares was made on 31.03.2005.

6. For details of related party transactions, please refer to the section titled ‘Related Party Transactions’ on page

no. 84 of this Draft Red Herring Prospectus. 7. All information shall be made available by the BRLMs and the Company to the public and investors at large

and no selective or additional information would be available for a section of the investors in any manner whatsoever.

8. Investors are advised to refer to the section titled ‘Basis of Issue Price’ on page no.34 of this Draft Red Herring

Prospectus before making an investment in this Issue. 9. This issue is being made through 100% Book Building Process wherein up to 50% of the issue shall be

allocated on a proportionate basis to Qualified Institutional Buyers (“QIBs”). Out of the portion available for allocation to the QIBs, 5% shall be available for allocation on proportionate basis to Mutual Funds and the remaining QIB portion shall be available for allocation on proportionate basis to all QIBs, including Mutual Funds subject to valid bids being received at or above the Issue Price. Further, not less than 15% of the Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 35% of the Issue shall be available for allocation on a proportionate basis to Retail Individual Bidders, subject to valid bids being received at or above the issue price.

10. In the event of the Issue being oversubscribed, the allocation shall be on a proportionate basis to Retail

Individual Bidders, Non-Institutional Bidders and QIBs. For more information, please refer to the section titled ‘Issue Procedure’ beginning from page no. 159 of this Draft Red Herring Prospectus.

Investors are free to contact the BRLMs or the Compliance Officer for any clarification or information or for any complaint pertaining to the Issue. For contact details, please refer to the cover page of this Draft Red Herring Prospectus.

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SECTION III – INTRODUCTION SUMMARY This is only a summary and does not contain all information that one should consider before investing in the equity shares offered by the Company. Investors should read the entire Draft Red Herring Prospectus, including the information on the section titled ‘Risk Factors’ beginning from page no. ix and the section titled ‘Financial Statements’ and related notes beginning from page no. 87 of this Draft Red Herring Prospectus before deciding to invest in the equity shares offered by our Company. INDUSTRY SUMMARY Travel and Tourism industry is one of the largest industries in the world today, responsible for employing more than 200 million people and generating over 10 per cent of global GDP. It provides a gateway to economic progress particularly in areas having limited options. The diversity of India’s natural and cultural richness provides the basis of a wide range of tourist products and experiences, which embraces business, leisure, culture, adventure, spirituality, eco tourism and many other pursuits. In recent years, India has emerged as a destination for natural and eco tourism and adventure tourism. Our country is becoming as one of the fastest growing tourist destinations in the world. Even with the present volumes of international tourist traffic, tourism has already emerged as an important segment of our country’s economy. Our country received around 3.91 million visitors in 2005 while the outbound travel was estimated at 7 million visitors in 2005. According to Department of Tourism, in the first four calendar months of 2006, the number of foreign tourist arrival has been estimated at about 1.6 Million showing an increase of 14.4% over the corresponding period last year. The foreign exchange earnings from tourism stood at Rs.25172 Crs. for the calendar year 2005 as compared to Rs.21603 Crs. in 2004 showing an increase of 16.5%. In the first four calendar months of 2006, these earnings are estimated at Rs. 9919.81 Crs. showing an increase of 16.3% in comparison to same period in the last year. While according to WTTC 2005 Report, the Travel &Tourism demand from the country accounts for a miniscule 0.7 per cent of the global pie, it is viewed as an emerging star in this region and is generating avid interest among investors and service providers viz. airlines and hotels. (Source: Department of Tourism; WTTC 2005 Report) The growth in Tourism in India can be attributed to 3 areas viz. Inbound Tourism, Outbound Tourism and Domestic Tourism. Over the years, the arrival of foreign tourists has grown from about 17,000 in 1951 to 1.68 Million in 1991 and to 3.91 Million in 2005. The Numbers include both business and leisure travelers and people of Indian origin traveling to meet family. Foreign tourism arrivals in India has grown by more than 16% in 2005 over 2004, primarily as a result of economic growth in EU and US, a strong business climate in India and aggressive promotion efforts by the Indian government. The flow of tourists into India has been mainly from USA and UK. They together constitute about 28% of the total number of foreign tourist arrivals in India during 2004. Other countries Sri Lanka, France, Canada, Germany, Japan, Malaysia, Australia and Italy are the other major international markets from which foreign tourists arrive in India. Apart from foreign tourists, the number of domestic tourist visits in India have also grown over the years. Domestic tourist visits have grown at a CAGR of about 14% over the period 1999 to 2004. The number of domestic tourist visits have increased from 66.7 Million in 1991 to 367.6 Million in 2004. The main reason for undertaking domestic trips in India is for Social purpose (e.g. visiting relatives and friends), religious trips and Leisure trips. The share of Uttar Pradesh and Andhra Pradesh, in number of domestic tourist visits is the highest at 25% share each in the total domestic tourist visit, followed by Tamilnadu at 12%, Karnataka at 7% and Rajasthan at 4%. In addition to growth in Inbound and Domestic tourism, the Outbound tourism from our country has also increased steadily over the last 5 years, driven by declining overseas air fares and increasing disposable income. The number of Outbound tourist visits have increased from 1.9 Million in 1991 to 6.2 Million in 2004. According to Business standard dated April 15, 2006 around 7 million people travelled abroad during 2005 (Source: Department of Tourism; Business Standard dt.15.04.2006)

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The growth in tourism has been accompanied by the revival of hotel projects, both luxury and two and three-star properties. Till the end of December 2004, there were 1892 hotels with 97770 rooms on the approved list of the Ministry of Tourism. During FY2003, the average occupancy in hotels stood at 54.8%, marginally higher than 53.2% recorded in FY2002. FY2004 saw marked improvement in occupancy with average occupancy rising to 59.7%. The increase in occupancies can be attributed to increase in foreign tourist arrivals and the pickup in the performance of the Indian corporate sector. (Source: ICRA : February 2005) An important highlight of the India tourism during 2005 was an increase of 20.20% witnessed in the foreign exchange earnings in dollar terms. The estimated foreign exchange earnings during the year touched the level of US $ 5730.86 million during 2005 against US $ 4769 million during 2004- a growth of about US $ 960 million in one year (Source-: Business standard 10/01/06). In absolute rupee terms, the increase in foreign exchange earnings during the year was to the tune of Rs. 3570 crores. It was observed that on an average per tourist foreign exchange earnings in India was about US $ 1462 against the estimated world average of US $ 850. Even when the average earnings per tourists are compared with those of the top world tourist generating countries or with countries in India’s neighborhood, it was highest in India with an exception of USA. The high spent in India can be mainly attributed to more number of days spent by a foreign tourist in India compared to other countries besides the visit of high end tourists to India. The government of India has initiated various policy changes in the recent past to boast tourism growth. Which include increased budgetary allocation for tourism at Rs. 830 crores (2006-07) against Rs. 786 crores in the year 2005-06 and Rs. 541 crores in the year 2004-05, removal and reductions in taxes on Travel & Tourism, flexible policy on charters, introduction of open skies for peek tourism season, privatization of Delhi & Mumbai Airports, Divestment in Government Hotels, enhanced participation between public & private sectors. which have helped in providing the required impetus to the growth in Tourism. Some of the other promotional activities undertaken by the government are: (a) Direct approach to the consumers through electronic and print media through the “Incredible India” campaign. (b) Centralised Electronic Media Campaign. (Athiti Dev Bhav) (c) Participation in Trade Fair & Exhibitions (d) Generating tourists Publications (e) Focusing on Growth of Hotel Infrastructure, particularly Budget Hotels. (f) Enhancing connectivity through augmentation of air capacity and improving road infrastructure to major tourist

attractions. (Source: Ministry of Tourism & Culture, Department of Tourism, WTTC: The 2005 Travel & Tourism Economic Research and DOT Annual Report 2004-05 ‘Incredible India’, a multi-pronged promotional campaign launched by the Department of Tourism, India, aims to position India as an up market destination for discerning travelers. It focuses on the diversity of India as a holiday destination ‘with something for everyone’, from beaches to mountains, world heritage sites to cultural fairs and safaris to holistic holidays. The Department of Tourism’s initiatives to provide visitors to ‘Incredible India’ with a world-class experience are bound to continue a gradual increase in India’s market share of global tourism. No wonder the Conde Nest Traveler, a leading International Travel publication has rated India as one of the top ten favorite tourism destinations.

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BUSINESS SUMMARY Our Company started operations in May 2, 1988 by offering holiday package tours to the foreign tourists visiting India. Over a period of 18 years, we have expanded our operations to Outbound Tourism, Domestic Tourism, Hotels and ticketing. We are recognized by the Ministry of Tourism, Government of India. We have received many awards and Certificates of Merit since 1992 for promoting tourism in India. This includes ‘Third Position under the First Category’, National Tourism Award for Excellence in Tourism, Given by Department of Tourism, Govt. of India for the year 2001-02 for being the third highest foreign exchange earner in our category. We have earned more than INR1670 Million worth of foreign exchange since inception. We are active members of various Indian and overseas Tourism organization, prominent among them being ASTA, PATA, USTOA, India Association of Tour Operators etc. We have our registered office in Delhi and branch offices in Chennai, Bangalore, Kolkata and Goa. Apart from this we are having about 35 local handling agents in India and about 5 local handling agents in other countries in the India Sub-Continent like Sri Lanka, Bhutan, Myanmar, Nepal and Bangladesh, for executing our business. Over the years, we have established good business relationship with some world renowned tour operators like GeBeCo – Germany, Djoser – Holland, Insight Reisen – Switzerland and Joe Far Reisen – Austria. We own a 3 Star Hotel property in Bikaner (Rajasthan). The Hotel became operational in 2000. We also own a fleet of 19 modern deluxe tourist transport coaches and 3 SUVs. The average age of these coaches is 30 months. The Hotel property and transport coaches facilitate the operations of our core business of tour operators. We offer a complete Holiday and Leisure solutions. Currently we are handling about 10000 clients from various countries on an annualised basis. We service to clients from over 26 countries across the globe which include Germany, Holland, Austria, Sweden, Finland, Denmark, Brazil, USA, Spain and East European countries. Our clientele include both business as well as leisure travelers. Our strength lies in providing tailor made timely and quality tour package options to the visiting tourists at an affordable price. We also organize Festive Tours, Wildlife Safaris, Camel Safaris, Ayurveda Tours etc. to promote the culture of our country.

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SUMMARY OF FINANCIAL DATA The following table sets forth the selected historical financial information of our Company derived from its restated and audited financial statements for the 12 –month period ended on March 31, 2001,2002, 2003, 2004 and 2005 as described in the Auditors’ report of M/s SNR & Co., Chartered Accountants included in the section titled ‘Auditors’ Report’ beginning from page no. 87 of this Draft Red Herring Prospectus and should be read in conjunction with those financial statements and notes thereon. SUMMARY STATEMENT OF ASSETS AND LIABILITIES AS RESTATED

(Rs. in lacs)

As at February 28, 2006

March 31, 2005

March 31, 2004

March 31, 2003

March 31, 2002

March 31, 2001

A. Fixed Assets: Gross Block 1,502.91 1,403.81 1,245.32 1,075.24 1,070.99 1,036.71 Less: Depreciation 499.09 420.93 351.17 302.52 246.90 179.12 Net Block 1,003.82 982.88 894.15 772.72 824.09 857.59 Less: Revaluation Reserve - - - - - -

Net Block After adjustment of Revaluation Reserve 1,003.82 982.88 894.15 772.72 824.09 857.59

Capital Work-in-progress inclusive of Capital Advance 195.06 102.95 74.83 45.00 45.00 45.00

Total 1,198.88 1,085.83 968.98 817.72 869.09 902.59 B. Investments 19.00 97.43 21.50 103.50 43.50 3.50

C. Current Assets, Loans and Advances

Inventories 1.02 0.98 0.78 0.87 0.58 0.56 Sundry Debtors 1,117.40 760.83 524.66 348.90 473.32 689.01 Cash and Bank balances 92.42 86.88 75.67 34.76 72.23 58.57 Loans and Advances 526.29 553.27 643.64 693.84 556.31 503.76

Total 1,737.13 1,401.96 1,244.76 1,078.37 1,102.44 1,251.90

D. Liabilities and Provisions: Secured Loans 125.84 183.22 203.03 247.76 256.47 282.47 Unsecured Loans 95.00 95.63 140.55 141.46 96.49 96.96 Current liabilities 602.39 523.06 382.06 187.84 279.41 481.21 Provisions 245.50 129.02 79.69 66.38 94.19 90.94 Deferred Tax Liability 142.61 128.20 117.27 111.80 - - Total 1211.34 1059.13 922.60 755.24 726.56 951.58

E. Networth (A+B+C-D) 1,743.67 1,526.09 1,312.64 1,244.35 1,288.47 1,206.41

F. Net worth Represented by (i) Share Capital 900.00 900.00 50.00 50.00 25.00 25.00 (ii) Share Application Money - - 0.16 0.16 0.16 0.16 (iii) General Reserve 466.20 466.20 1,205.00 1,175.00 1,175.00 1,175.00 (iv) Profit & Loss 377.47 159.89 46.28 11.99 81.11 4.05(v) Foreign Exchange Reserve - - 11.20 7.20 7.20 2.20

Net Worth 1743.67 1526.09 1312.64 1244.35 1288.47 1206.41

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SUMMARY STATEMENT OF PROFIT AND LOSS ACCOUNT AS RESTATED

(Rs. in lacs) Year ended 28.02.2006 31.03.2005 31.03.2004 31.03.2003 31.03.2002 31.03.2001Period (11 Months) (12 Months) (12 Months) (12 Months) (12 Months) (12 Months) Income Sales: Tour Receipts 4077.24 3258.86 2027.52 1002.77 1867.88 2251.40Hotel Sales 141.76 126.86 108.13 69.47 70.51 59.00Other Income 11.27 15.37 4.85 8.07 6.36 6.90Total Income (A) 4230.28 3401.09 2140.50 1080.31 1944.75 2317.30 Expenditure Material consumed 34.74 35.46 30.52 15.99 16.47 11.56Tour Expenses 3121.81 2460.05 1516.94 702.40 1361.62 1754.76Salaries, Wages and Benefits 170.44 111.64 77.43 64.87 76.78 72.59Directors Remuneration 74.25 44.57 36.00 36.00 36.00 36.00Administration and other Expenses

315.63 344.87 231.43 124.70 222.95 178.85

Selling & Distribution Expenses

42.5357.74 42.87 8.15 24.78 23.71

Depreciation 83.97 70.68 56.37 56.24 69.96 61.26Interest & Financial Charges 18.96 30.10 27.51 21.86 30.09 37.62Total Expenditure (B) 3862.33 3155.11 2019.07 1030.21 1838.64 2176.35Net Profit before Tax and Extraordinary Items (A-B)

367.95 245.98 121.43 50.10 106.11 140.95

Taxation Current Tax 148.00 80.50 17.00 3.00 7.88 14.39Deferred Tax 14.42 10.93 5.46 13.84 - -Fringe Benefit Tax - - - - - -Net Profit before Extraordinary Items

205.53 154.55 98.97 33.26 98.23 126.56

Extraordinary Items (net of tax) Profit/ (Loss) on Sale of Assets 1.38 (1.42) 0.24 (1.19) (2.39) - Profit/(Loss) on Sale of Investments 5.40 (7.84) 9.06 7.69 - -

Loss due to Fire - - (7.37) - - -Foreign Exchange Fluctuation 5.27 (5.96) (15.72) (1.19 ) - 21.30Net Profit after Extraordinary Items

217.58 139.33 85.18 38.57 95.84 147.86

Note: The above statement should be read with the Notes on adjustments and significant accounting policies & notes to the accounts for restated financial statements as appearing in Annexure to the report included in the section titled ‘Auditors’ Report’ on page no. 87 of this Draft Red Herring Prospectus are integral part of this statement.

5

THE ISSUE Equity Shares offered: 85,72,000 Equity Shares of Rs. 10/- each Of which: Qualified Institutional Buyers (QIBs) Portion (1) (Allocation on a proportionate basis) Out of which

a) Reservation for Mutual Funds b) Balance for all QIBs including Mutual Funds Non Institutional Portion (2) (Allocation on a proportionate Basis) Retail Portion (2) (Allocation on a proportionate basis)

Upto 42,86,000 Equity Shares of Rs. 10/- each constituting 50% of the Issue 2,14,300 Equity Shares of Rs. 10/- each constituting reservation up to 5% of the QIB portion 40,71,700 Equity Shares of Rs. 10/- each constituting balance of the QIB portion Atleast 12,85,800 Equity Shares of Rs. 10/- each constituting 15% of the Issue Atleast 30,00,200 Equity Shares of Rs. 10/- each constituting 35% of the Issue

Equity Shares outstanding prior to the Issue 90,00,000 Equity Shares of Rs. 10/- each Equity Shares outstanding after the Issue 1,75,72,000 Equity shares of Rs. 10/- each

(1) As per recent amendments to the SEBI Guidelines, allocation to QIBs is proportionate as per the terms of this Draft Red Herring Prospectus. 5% of the QIBs portion would be specifically reserved only for Mutual Funds and Mutual Fund applicants shall also be eligible for proportionate allocation under the balance available for. Further attention of all QIBs is required towards the following:

a. Once a QIB has applied for our issue, the QIB will not be allowed to withdraw the application, after the Bid Issue/Closing date.

b. Each QIB including Mutual Funds will be required to deposit 10% margin money with application. c. Subject to valid bids being received at or above the Issue Price, under–subscription, if any, in the QIB

category would be allowed to be met with spill over interse from any other category

(2) Subject to valid bids being received at or above the Issue Price, under–subscription, if any, in the Retail and Non Institutional categories would be allowed to be met with spill over interse from any other category, at the sole discretion of our Company in consultation with the BRLMs. Use of Issue proceeds For detailed discussion on the objects of the issue,

please refer to the section entitled ‘Objects of the Issue’ on page no. 22 of this Draft Red Herring Prospectus for additional information.

6

GENERAL INFORMATION

Our Company was originally incorporated as Indo Asia Tours Private Limited on May 2, 1988, at New Delhi, under the provisions of the Companies Act, 1956. The name of our Company was changed to Indo Asia Leisure Services Private Limited w.e.f. September 23, 2005. Our Company was converted from Private Limited to Public Limited Company under the provisions of section 44 of the Companies Act, 1956 w.e.f October 19, 2005 and accordingly the name of our Company was changed to Indo Asia Leisure Services Limited. For details of changes in the address of our registered office, please refer to page no.68 of this Draft Red Herring Prospectus. Registered Office C-28, Housing Society South Extension Part- I, New Delhi-110049, India. Branch Offices:

A. Chennai

B. Bangalore

C. Kolkata

D. Goa

1K, Mandira Apartments, 23-D, North Boag Road, T-Nagar, Chennai-600 017 102, Skylark Residency, Wind Tunnel Road, Murgeshpalya, Bangalore - 560 017 2nd Floor, Premises No. 34/1C, Kavi Bharati Sarani, Kolkata – 700 029 City Business Centre, Coelho Pereira Building, Dr. Dada Vaidya Road, Panaji, Goa.

Contact Person Mr. Bhupinder Kumar Company Secretary & Compliance Officer Registrar of Companies Registrar of Companies, N.C.T., Delhi & Haryana, CGO complex, Paryavaran

Bhavan, Lodhi Road, New Delhi 110 003 Registration No. 55–31449 *The registered office and branch offices of our company are situated on leased premises. BOARD OF DIRECTORS

Name of Director Designation Mr. Sunirmol Ghosh Wholetime Director Mr. Sudesh Behal Wholetime Director Mr. Gajendra Singh Panwar Wholetime Director Mr. Kishore Kumar Lahiri Independent Director Mr. Sidhartha Roy Independent Director Mr. Kailash K. Thadani Independent Director

For more details on our Directors, please refer to the section titled ‘Our Management’ on page no. 70 of this Draft Red Herring Prospectus. Company Secretary and Compliance Officer: Mr. Bhupinder Kumar Indo Asia Leisure Services Limited C-28, Housing Society, South Extension, Part – I, New Delhi-110049, India. Tel.: +91 11 24691733 Fax: +91 11 24620533 E-mail: ipo@indoasiatours.com

7

Legal Adviser to the Issue: Luthra & Luthra 103, Ashoka Estate Barakhamba Road, New Delhi – 110 001. Tel.: +91 11 51215100 Fax: +91 11 23723909 Contact Person: Mr. Sanjeev Kumar Sharma/ Mr. Koshy John E-mail: sksharma@luthra.com Bankers to the Company ABN AMRO Bank N.V. Hansalya, 15, Barakhamba Road, Canaught Circle, New Delhi- 110001 Tel: +91 11 42121005 Fax: +91 11 23702676 Email: sunaina.gupta@in.abnamro.com The Hongkong and Shanghai Banking Corporation Limited F-43, South Extension, Part I, New Delhi-110049 Tel: +91 11 2373 8989 Fax: +91 11 2464 5295 Bank of Tokyo-Mitsubishi Ltd. Jeevan Vihar Building, 3, Parliament Street, New Delhi- 110001 Tel: +91 11 41003456 / 41004567 Fax: +91 11 41003155 State Bank of India South Extension, Part I, New Delhi-110049 Tel: +91 11 24652652 Email: Sbi.00730@sbi.co.in

Bank of Maharashtra South Extension, Part I, New Delhi-110049 Tel: +91 11 24626168 Fax: +91 11 24631151 Email: Bom392@mahabank.co.in

8

State Bank of Bikaner & Jaipur Hospital Road Branch, Near Ambedkar Circle, Bikaner-334001 Tel: +91 151 2223052/53 Fax: +91 151 2223054 Email:dgmbik@datainfosys.net Vijaya Bank 208, 5th Cross, 1st Main Road, Damlur Layout, Bangalore - 560 071 Tel: +91 80 25353530/ 25354645 Bank of India Overseas Branch, Barakhamba Road, New Delhi-110001 Tel: +91 11 28844075/ 23350859 Fax: +91 11 23710377 Email: boindo@nda.vsnl.net.in

ISSUE MANAGEMENT TEAM Book Running Lead Manager: IDBI Capital Market Services Limited 5th Floor, Mafatlal Centre, Nariman Point, Mumbai – 400 021. Tel.: +91 022 5637 1212 Fax: +91 022 2288 5850 Website: www.idbicapital.com Email: ials.ipo@idbicapital.com Contact Person: Mr. Prakash K. Saraogi Co-Book Running Lead Manager: Chartered Capital and Investment Limited 13, Community Centre, East of Kailash, New Delhi- 110 001 Tel: +91 11 26472557/ 2619079/26218274 Fax: +91 11 26219491 Email: delhi@charteredcapital.net Contact Person: Mr. Amit Mehta

9

Registrar to the Issue: Intime Spectrum Registry Limited C-13, Pannalal Silk Mills Compound, L.B.S. Marg, Bhandup (West), Mumbai – 400078. Tel.: +91 22 2596 0320 Fax: +91 22 2596 0329 Website: www.intimespectrum.com Email: indoasia@intimespectrum.com Contact Person: Mr. Salim Shaikh Bankers to the Issue [●] Brokers to the issue [●] Syndicate Members [●] Auditors of the Company M/s SNR & Co., Chartered Accountants A – 15, Hauz Khas, New Delhi – 110 016 Tel: +91 11 41655801, 26856421 Fax: +91 11 2656 7540 Email: snr@bol.net.in, snr@vyasnvyas.com Contact Person: Mr. Suresh Vyas

10

STATEMENT OF INTER-SE ALLOCATION OF RESPONSIBILITIES AMONGST THE BRLMs The responsibilities and co-ordination for various activities in this Issue have been distributed amongst the BRLMs as under: Sr. No. Activities Responsibility Co-ordinator

1. Capital Structure with the relative components and formalities such as type of instruments, etc.

IDBI Capital IDBI Capital

2. Due diligence of the Company’s operations/ management/business plans/legal, etc.

IDBI Capital IDBI Capital

3. Drafting and design of the Offer Document and of statutory advertisement including memorandum containing salient features of the Prospectus. The designated Lead Manager shall ensure compliance with the stipulated requirements and completion of prescribed formalities with Stock Exchange, Registrar of Companies and SEBI including finalisation of Prospectus and RoC filing of the same.

IDBI Capital IDBI Capital

4. Drafting and approval of all publicity material other than statutory advertisement as mentioned in Para (3) above including corporate advertisement, brochure, road shows presentations, FAQs, Corporate films etc.

IDBI Capital & Chartered Capital

IDBI Capital

5. Appointment of other intermediaries viz. Registrar, Bankers, Printer and Advertisement Agency.

IDBI Capital & Chartered Capital

IDBI Capital

6. Institutional Marketing of the Issue, which will cover inter alia, finalizing the list and division of investors for one to one meeting; finalizing road- show schedule and investor meeting schedule.

IDBI Capital & Chartered Capital

IDBI Capital

7. Non- Institutional and Retail Marketing of the Issue • Formulating marketing strategies, preparation of publicity budget• Finalise Media and PR strategy • Finalising centers for holding conference for brokers, etc. • Finalise collection centers • Follow up on distribution of publicity and Issue material

including form, prospectus and deciding on the quantum of the Issue material

IDBI Capital & Chartered Capital

IDBI Capital

8. Managing the Book, co-ordination with Stock Exchanges for book building software, bidding terminals and mock trading and finalizing of pricing and institutional allocation in consultation with our Company

IDBI Capital & Chartered Capital

IDBI Capital

9. Post bidding activities including management of Escrow Accounts, co-ordination with Registrar and Bank, intimation of allocation and Refund to Bidders, etc.

Chartered Capital & IDBI Capital

Chartered Capital

10. The post-offer activities of the Issue will involve essential follow up steps, which will include finalisation of listing of instruments and dispatch of certificates and refunds, with the various agencies connected with the work such as Registrars to the Issue, Bankers to the Issue and the bank handling refunds business. Lead Manager shall be responsible for ensuring that these agencies fulfill their functions and enable him to discharge this responsibility through suitable arrangements with our Company.

Chartered Capital & IDBI Capital

Chartered Capital

11

The selection of the various agencies like the Registrar to the Issue, Bankers to the Issue, escrow Collection Bank(s), Syndicate Members, brokers, advertising agencies, printer etc. will be finalized by the Company in consultation with the BRLMs in terms of the interse allocation of responsibilities. Even if many of these activities will be handled by other intermediaries, the designated BRLM shall be responsible for ensuring that these agencies fulfill their functions and enable it to discharge this responsibility through suitable agreements with the Company. Credit Rating This being an issue of Equity Shares, credit rating is not required. Trustees As the Issue is of Equity Shares, the appointment of Trustees is not required. Monitoring Agency No agency has been appointed to monitor the utilization of funds. Underwriting Agreement After allocation of our Equity shares but prior to filing of the Prospectus with ROC, our Company will enter into an Underwriting Agreement with the Underwriters for the Equity Shares proposed to be offered through the Issue. It is proposed that pursuant to the terms of the Underwriting Agreement, the BRLMs shall be responsible for bringing in the amount devolved in the event that the Syndicate Members do not fulfill their underwriting obligations. The Underwriters have indicated their intention to underwrite the following number of Equity Shares:

Name and Address of the Underwriters

Indicated Number of Equity Underwritten

Amount Underwritten (Rs. in Lacs)

[•]

[•]

The above-mentioned amount is indicative underwriting and this would be finalized after pricing and actual allocation. The above underwriting agreement is dated [•] In the opinion of the Board of Directors of our Company, the resources of all the above mentioned Underwriters are sufficient to enable them to discharge their respective underwriting obligations in full. All the above-mentioned Underwriters are registered with SEBI under section 12(1) of the SEBI Act or registered as brokers with the stock exchange (s). The above Underwriting Agreement has been accepted by the Board of Directors of our Company at their meeting held on [•] and our Company has issued letters of acceptance to the underwriters. Allocation among the Underwriters may not be necessarily in the proportion to their underwriting commitments. Notwithstanding the above table, the BRLMs and the syndicate members shall be severally responsible for ensuring payment with respect to Equity Shares allocated to investors procured by them. In the event of any default in payment, the respective underwriter in addition to other obligations to be defined in the Underwriting Agreement, will also be required to procure / subscribe to the extent of the defaulted amount.

12

BOOK BUILDING PROCESS Book Building refers to the process of collection of bids from investors on the basis of this Draft Red Herring Prospectus including the Price Band. This Issue Price is fixed after the Bid/Issue Closing Date. The principal parties involved in the Book Building Process are:

1. Our Company; 2. Book Running Lead Managers, in this case being IDBI Capital Market Services Limited & Chartered

Capital & Investments Limited. 3. Syndicate Members who are intermediaries registered with SEBI or registered as brokers with BSE/NSE

and eligible to act as underwriters. The Syndicate Members will be appointed by the BRLMs; 4. Registrars to the Issue, in this case being Intime Spectrum Registry Limited.

This Securities in this Issue is being offered to the public through the 100% Book Building Process wherein (i) upto 50% of the Issue shall be allocated on a proportionate basis to Qualified Institutional Buyers (“QIBs”) (including 5% of the QIBs’ portion that would be specifically reserved only for Mutual Funds and Mutual Fund applicants shall also be eligible for proportionate allocation under the balance available for QIBs); (ii) atleast 15% of the Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders; and (iii) atleast 35% of the Issue shall be available for allocation on a proportionate basis to Retail Individual Bidders, subject to valid bids being received at or above the Issue Price. Our Company will comply with these Guidelines for this Issue. In this regard, our Company has appointed the BRLMs to procure subscriptions to the Issue. The process of book building, under SEBI Guidelines, is relatively new and the investors are advised to make their own judgment about investment through this process prior to making a Bid in the Issue. QIBs are not allowed to withdraw their Bid after the Bid/Issue Closing Date. For more details, please refer to the section titled ‘Terms of the Issue’ beginning from page no. 156 in this Draft Red Herring Prospectus. Steps to be taken by the Bidders for bidding: • Check whether he/ she is eligible for bidding; • Bidder necessarily needs to have a demat account; • Ensure that the Bid cum Application Form is duly completed as per instructions given in this Draft Red

Herring Prospectus and in the Bid cum Application Form; and • Ensure that the Bid cum Application Form is accompanied by the Permanent Account Number or by Form 60 or

Form 61 as may be applicable together with necessary documents providing proof of address. For more details, please refer to the section titled ‘Issue Procedure’ beginning from page no. 159 of this Draft Red Herring Prospectus. Bidders are specifically requested not to submit their General Index Register number instead of the Permanent Account Number, as the Bid is liable to be rejected.

13

Illustration of Book Building and Price Discovery Process (Investors should note that the following is solely for the purpose of illustration and is not specific to the Issue) Bidders can bid at any price within the price band. For instance, assuming a price band of Rs. 60/- to Rs. 72/- per share, issue size of 5,000 equity shares and receipt of seven bids from bidders details of which are shown in the table below. A graphical representation of the consolidated demand and price would be made available at the bidding centers during the bidding period. The illustrative book as shown below shows the demand for the shares of our Company at various prices and is collated on the basis of bids from various investors.

Bid Quantity Bid Price (Rs.) Cumulative Quantity Subscription 1700 72 1700 34% 1500 71 3200 64% 1000 70 4200 84% 200 69 4400 88% 500 68 4400 98% 2000 65 6900 138% 1000 62 7900 158%

The price discovery is a function of demand at various prices. The highest price at which we are able to issue the desired quantum of shares is the price at which the book cuts off i.e. Rs. 65/- in the above example. We, in consultation with the BRLM will finalize the issue price at or below such cut off price i.e. at or below Rs. 65/-. All bids at or above this issue price and cut-off bids are valid bids and are considered for allocation in respective category.

14

CAPITAL STRUCTURE The share capital of our Company as on the date of filing of this Draft Red Herring Prospectus with SEBI is as set forth below: Particulars Aggregate Nominal

Capital (Rs.)

Total Value at Issue price

(Rs.) A. Authorized Capital

2,00,00,000 Equity Shares of Rs. 10/- each

20,00,00,000

B. Issued Subscribed and Paid-Up Capital before the Issue 90,00,000 Equity Shares of Rs. 10/- each fully paid-up

9,00,00,000

9,00,00,000

C. Present Issue in terms of this Draft Red Herring Prospectus 85,72,000 Equity Shares of Rs. 10/- each

8,57,20,000

[•]

D. Equity Capital After the Issue 1,75,72,000 Equity Shares of Rs. 10/- each.

17,57,20,000

[•]

E. Share Premium Account Before the Issue After the Issue

Nil [•]

*Our Company is exploring possibilities of placing Equity Shares with certain investors prior to filing of Red Herring Prospectus with the ROC. In such a case, the size of the Net Issue to Public would stand reduced to the extent of such placement. History of changes made in the Authorized Share Capital

Date of change Authorized capital pursuant to change

04.08.1998

Alteration in the capital clause by way of increase in authorized capital from 1,00,000 Equity shares of Rs. 10/- each aggregating to Rs.10 Lacs to 5,00,000 Equity shares of Rs. 10/- each aggregating to Rs.50 Lacs.

04.03.2004

Alteration in the capital clause by way of increase in authorized capital from 5,00,000 Equity shares of Rs.10/- each aggregating to Rs.50 Lacs to 1,00,00,000 Equity shares of Rs. 10/- each aggregating to Rs.10 crores.

*12.05.2006 Alteration in the capital clause by way of increase in authorized capital from 1,00,00,000 Equity shares of Rs.10/- each aggregating to Rs.10 Crores to 2,00,00,000 Equity shares of Rs. 10/- each aggregating to Rs.20 crores.

*The Company is in the process of filing the required forms with RoC, NCT, Delhi and Haryana at Delhi in respect of the increase in authorised capital to Rs.20 Crores, approved by the members of the company on 12.05.2006.

15

Notes to the Capital Structure 1. Share Capital History

Date of allotment Number of

Equity Shares

Face Value(Rs.)

Issue Price (Rs.)

Nature of payment of

consideration

Reasons for Allotment

(Bonus, Swap Etc.)

Cumulative Paid-up Capital

(Rs.)

Cumulative Share

Premium (Rs.)

Subscribers to the memorandum

40

10 10 Cash Initial subscription

400 -

March 16, 1993

39,960

10 10

Cash Further Issue of Shares

4,00,000 -

February 24, 2001

2,10,000

10 10

Cash Further Issue of Shares

25,00,000 -

January 22, 2003

2,50,000

10 10

Cash Further Issue of Shares

50,00,000 -

March 30, 2005

10,00,000

10 10

Cash Rights Issue of Shares

1,50,00,000 -

March 31, 2005 75,00,000 10 10 - Bonus Issue in the ratio of 5:1

9,00,00,000 -

2. Promoters Contribution And Lock-In:

3 Years lock-in Pursuant to the SEBI Guidelines, an aggregate of 20% of the post-issue Equity Share capital of our Company shall be locked in by our Promoters for a period of three years from the date of allotment in this Issue. The Equity Shares, which are being locked-in, are not ineligible for computation of Promoters’ contribution under Clause 4.6 of the SEBI Guidelines. The details of the promoters’ Equity Shares locked-in for a period of three years are as follows:

Name of the

Promoter Date of

Allotment/ Acquisition

Date when made fully

Paid-up

Consideration (Cash, bonus,

kind, etc.)

No. of Equity Shares

Face Value (Rs.)

Issue/ Acquis-ition Price (Rs.)

% of Post-Issue paid-up

capital

Mr. Sunirmol Ghosh 31.03.2005

31.03.2005

Bonus

11,71,467 10 Nil

6.67%

Mr. Sudesh Behal 31.03.2005

31.03.2005

Bonus

11,71,467 10 Nil

6.67%

Mr. Gajendra Singh Panwar

31.03.2005

31.03.2005

Bonus

11,71,466 10 Nil

6.67%

Total 35,14,400 20%

1 Year lock-in Other than the lock-in on the promoters’ shares as stated above, the entire Pre-issue capital of our Company will be locked in for a period of one year from the date of allotment in this issue. The details of the promoters’ and Promoter Group and other Equity Shares locked-in for a period of One year are as follows:

16

Name of the Promoter

Date of Allotment/ Acquisition

Consider-ation

(Cash, bonus,

kind, etc.)

No. of Equity Shares

(Rs.)

Issue/ Date when made fully

Paid-up

Face Value

% of Post-Issue paid-up

capital Acquis-ition Price (Rs.)

PROMOTERS 02.05.1988 02.05.1988 Cash 10 10 10 16.03.1993 Cash 9,990 10

Transfer Cash 5,000 10 24.02.2001 24.02.2001 Cash 10 10

16.03.1993 10 Mr. Sunirmol Ghosh

16.12.1996 10 60

21.01.2003 21.01.2003 Cash 633 10 10 30.03.2005 Cash 2,96,751 10

31.03.2005 Bonus 3,90,758 10 30.03.2005 10

31.03.2005 10 Total 7,03,202 4.00%

02.05.1988 02.05.1988 Cash 10 10 10 16.03.1993 16.03.2003 Cash 10 10 16.12.1996 Transfer 5,000 10 10 24.02.2001 Cash 2,180 10

21.01.2003 Cash 1,013 10 30.03.2005 30.03.2005 Cash

Mr. Sudesh Behal 9,990

Cash 24.02.2001 10

21.01.2003 10 2,94,251 10 10

31.03.2005 31.03.2005 Bonus 3,90,758 10 10 Total 7,03,202 4.00%

24.02.2001 24.02.2001 Cash 26,720 10 10 21.01.2003 21.01.2003 Cash 16,773 10 10 30.03.2005 30.03.2005 Cash 88,761 10 10 30.03.2005 Transfer Transfer 3,30,778 10 10 31.03.2005 31.03.2005 11,43,694 10 10

Mr. Gajendra Singh Panwar

Total 16,06,726 9.14% PROMOTER GROUP

24.02.2001 24.02.2001 Cash 44,140 10 10 30.03.2005 30.03.2005 Cash 90,082 10 10 31.03.2005 31.03.2005 Bonus 6,71,110 10 10

Mrs. Priti Behal

Total 8,05,332 4.58% 22.01.2003 22.01.2003 Cash 44,140 10 10 30.03.2005 30.03.2005 Cash 90,082 10 10 31.03.2005 31.03.2005 Bonus 6,71,110 10 10

Mrs. Meeta Ghosh

Total 8,05,332 4.58% 22.01.2003 22.01.2003 Cash 11,061 10 10 30.03.2005 30.03.2005 Cash 22,573 10 10 31.03.2005 31.03.2005 Bonus 1,68,170 10 10

Mrs. Sunita Panwar

Total 2,01,804 1.15% 30.03.2005 30.03.2005 Cash 50,000 10 10 31.03.2005 31.03.2005 Bonus 2,50,000 10 10

M/s Sudesh Behal HUF

Total 3,00,000 1.71% 30.03.2005 30.03.2005 Cash 50,000 10 10 31.03.2005 31.03.2005 Bonus 2,50,000 10 10

M/s Sunirmol Ghosh HUF

Total 3,00,000 1.71% OTHERS

Bonus

17

02.05.1998 02.05.1998 Cash 10 10 10 16.03.1993 16.03.1993 Cash 9,990 10 10 31.03.2005 31.03.2005 Bonus 50,000 10 10

Mr. Radhey K. Gupta

Total 60,000 0.34% 30.09.2005 N.A. Cash 1 10 10 - Mr. Surender Nagpal

Total 1 30.09.2005 N.A. Cash 1 10 10 - Mr. Charanjeet Singh

Kocchar Total 1 GRAND TOTAL 54,85,600 31.22%

a. Other than the lock-in on the promoters’ shares as stated above, the entire Pre-issue capital of our Company,

including allotment of Equity Shares to certain investors after filing of this draft offer document but prior to filing of Prospectus with ROC, will be locked in for a period of one year from the date of allotment in this issue.

b. In terms of clause 4.16.1 (b) of the SEBI Guidelines, locked in Equity Shares held by the Promoters may be

transferred to and amongst the Promoters/ Promoter group or to a new promoter or persons in control of the Company subject to continuation of the lock-in in the hands of the transferees for the remaining period and compliance with Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeover) Regulations, 1997 as applicable.

Further, in terms of clause 4.16.1 (a) of the SEBI Guidelines, locked in Equity Shares held by shareholders other than the Promoters may be transferred to any other person holding shares which are locked-in as per Clause 4.14 of the SEBI Guidelines, subject to continuation of the lock-in in the hands of the transferees for the remaining period and compliance with Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeover) Regulations, 1997 as applicable.

c. In terms of clause 4.15 of the SEBI Guidelines, locked-in securities held by promoters may be pledged only with banks or Financial Institutions as collateral security for loans granted by such banks or financial institutions, provided the pledge of shares is one of the terms of sanction of loan.

3. Shareholding pattern of our Company prior and post this Issue

Prior to the Issue Post Issue Category Number of Shares

% of Total Number of Shares

% of Total

Promoters Mr. Sudesh Behal Mr. Sunirmol Ghosh Mr. Gajendra Singh Panwar

18,74,669 18,74,669 27,78,192

20.83% 20.83% 30.87%

18,74,669 18,74,669 27,78,192

10.67% 10.67% 15.81%

Sub Total (A) 65,27,530 72.53% 65,27,530 37.15% Promoter Group Mrs. Priti Behal Mrs. Meeta Ghosh Mrs. Sunita Panwar M/s Sudesh Behal HUF M/s Sunirmol Ghosh HUF

8,05,332 8,05,332 2,01,804 3,00,000 3,00,000

8.95% 8.95% 2.24% 3.33% 3.33%

8,05,332 8,05,332 2,01,804 3,00,000 3,00,000

4.58% 4.58% 1.15% 1.71% 1.71%

Sub Total (B) 24,12,468 26.81% 24,12,468 13.73% Promoter & Promoter Group (A+B)

89,39,998

99.33%

89,39,998 50.88%

Persons Acting in Concert (C) 60,002 0.67% 60,002 0.34% Public Issue (D) - - 85,72,000 48.78 Total Equity Shares 90,00,000 100.00% 1,75,72,000 100.00%

18

4. Particulars of top ten shareholders as on the date of filing of this Draft Red Herring Prospectus with SEBI are as

follows:

Sr. No. Name of the Shareholder No. of Shares 1. Mr. Gajendra Singh Panwar 27,78192 2. Mr. Sunirmol Ghosh 18,74,669 3. Mr. Sudesh Behal 18,74,669 4. Mrs. Meeta Ghosh 8,05,332 5. Mrs. Priti Behal 8,05,332 6. M/s Sudesh Behal HUF 3,00,000 7. M/s Sunirmol Ghosh HUF 3,00,000 8. Mrs. Sunita Panwar 2,01,804 9. Mr. Radhey Kishan Gupta 60,000

10. Mr. Charanjeet Singh Kocchar 1 11. Mr. Surender Nagpal 1

5. Particulars of top ten shareholders ten days prior to the date of filing this Draft Red Herring Prospectus with

SEBI are as follows:

Sr. No. Name of the Shareholder No. of Shares 1. Mr. Gajendra Singh Panwar 27,78192 2. Mr. Sunirmol Ghosh 18,74,669 3. Mr. Sudesh Behal 18,74,669 4. Mrs. Meeta Ghosh 8,05,332 5. Mrs. Priti Behal 8,05,332 6. M/s Sudesh Behal HUF 3,00,000 7. M/s Sunirmol Ghosh HUF 3,00,000 8. Mrs. Sunita Panwar 2,01,804 9. Mr. Radhey Kishan Gupta 60,000

10. Mr. Charanjeet Singh Kocchar 1 11. Mr. Surender Nagpal 1

6. Particulars of top ten shareholders 2 years prior to the date of filing of this Draft Red Herring Prospectus with

SEBI are as follows:

Sr. No. Name of the Shareholder No. of Shares 1. Mr. Sunirmol Ghosh 1,73,583 2. Mr. Sudesh Behal 1,73,583 3. Mrs. Meeta Ghosh 44,140 4. Mrs. Priti Behal 44,140 5. Mr. Gajendra Singh Panwar 43,493 6. Mrs. Sunita Panwar 11,061 7. Mr. Radhey Kishan Gupta 10,000

19

7. The Promoters/Promoter Group and Directors of our company have not purchased or sold the Equity Shares of our Company during the period of six months preceding the date of filing of this Draft Red Herring Prospectus with SEBI.

8. The total number of members of our Company as on the date of filing this Draft Red Herring Prospectus is

eleven. 9. The Company has not availed any bridge loan against the proceeds of this Issue. 10. The Promoters, Directors and BRLMs to the Issue have not entered into any buy-back, standby or similar

arrangements for any of the securities being issued through this Draft Red Herring Prospectus. 11. In this Issue, in case of over-subscription in all categories, not more than 50 % of the Issue shall be allocated on

a proportionate basis to Qualified Institutional Buyers. Out of this, not less than 5 % will be allocated to Mutual Funds on a proportionate basis. Mutual Fund applicants shall also be eligible for proportionate allocation under the balance available for Qualified Institutional Buyers. Further, atleast 15 % of the Issue shall be available for allocation on a proportionate basis to Non Institutional Bidders and atleast 35 % of the Issue shall be available for allocation on a proportionate basis to Retail Bidders, subject to valid bids being received at or above the Issue Price.

12. Subject to valid bids being received at or above the Issue Price, under–subscription, if any, in the Retail, Non

Institutional and QIB categories would be allowed to be met with spill over interse from any other category, at the sole discretion of our Company in consultation with the BRLMs.

13. A Bidder cannot make a Bid for more than the number of Equity Shares offered through the Issue, i.e.,

85,72,000 Equity Shares, subject to the maximum limit of investment prescribed under relevant laws applicable to each category of investor.

14. There are no outstanding warrants, options or right to convert debentures, loans or other instruments into our

Equity shares. 15. Our Company is exploring possibilities of placing Equity Shares with certain investors prior to filing of Red

Herring Prospectus with the ROC. In such a case, the size of the Net Issue to Public would stand reduced to the extent of such placement.

16. We presently do not have any intention or proposal to alter our capital structure for a period of six months from

the date of opening of this Issue, by way of split/ consolidation of the denomination of Equity Shares or further issue of Equity Shares (including issue of securities convertible into or exchangeable, directly or indirectly, for our Equity Shares) whether preferential or otherwise, However, during such period or at a later date, we may issue equity shares or issue equity shares or securities linked to equity shares to finance an acquisition, merger or joint venture by us or as consideration for such acquisition, merger or joint venture or for regulatory compliance or such other scheme of arrangement if an opportunity of such nature is determined by our board to be in the interest of our Company.

17. Our Company does not have any outstanding Employees Stock Option Plan. 18. Our Company has not made any public issue since its inception. 19. Our Company undertakes that at any given time, there shall be only one denomination for the shares of our

Company and our Company shall comply with such disclosure and accounting norms specified by SEBI from time to time.

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

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21. An over-subscription to the extent of 10% of the Issue size can be retained for the purpose of rounding off to the nearer multiple of one Equity Share while finalizing the allotment.

22. In respect to Term Loan agreement entered into by our Company with TFCI, we are bound by certain restrictive

covenants regarding our capital structure. This includes convertibility option in the hands of TFCI, of the outstanding amount of debt into fully paid up equity shares of our company, in the event of our default in repayment of three consecutive instalments. The outstanding amount of TFCI as on February 28, 2006 is Rs. 80.18 Lacs. Pursuant to the aforesaid covenants, we have obtained NOC from TFCI with regard to the present issue.

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OBJECTS OF THE ISSUE The main objective of this issue is to raise capital for financing our business expansion which includes establishment of Operational Headquarters and Corporate office at Gurgaon, Haryana, establishment of Sales and Marketing Offices abroad, Setting up of Holiday & Travel Solution Stations across India, Setting up of new hotels/ taking over existing hotels on long term lease, setting up an Online Travel Portal and Travel Support Stations and acquiring new tourist transport coaches to facilitate and expand our business operations. Our assessment of funds requirement and deployment is based on internal management estimates and has not been appraised by any bank or financial institution or any independent organisation. Our capital expenditure plans are subject to a number of variables, including possible cost overruns; construction/development delays or defects; receipt of critical governmental approvals; and changes in management’s views of the desirability of current plans, among others. In case of any variations in the actual utilization of funds earmarked for the above activities, the difference, if any, may be adjusted against the availability / requirement of funds in the areas identified as part of the expansion plan and/or increased fund deployment for a particular activity. The main objects clause and objects incidental or ancillary to the main objects of the Memorandum of Association of our Company enables us to undertake existing activities as well as the activities for which the funds are being raised through this Issue. The objects of the present Issue of equity Shares are:

1. To meet capital expenditure on expansion of business activities. 2. To meet additional working capital requirement of the company. 3. To list the Equity Shares of our Company on the BSE & NSE 4. To meet the expenses of this issue

REQUIREMENT OF FUNDS Our Management estimates the total requirement of funds at Rs.[•] the details of which is given below:-

(Rs. in Lacs) S.No. Particulars Amount

A. Capital Expenditure on business expansion (i) Cost of construction of Operational Headquarter and Corporate Office at Gurgaon,

Haryana 670.59

(ii) Cost of establishment of ‘Holiday & Travel Solution Stations’ (offices) in various cities of India

1155.50

(iii) Cost of establishment of Sales & Marketing offices in UK & USA 771.53 (iv) Cost of Construction/Commencing Operation of 3 Star Hotel at Jaipur & 3 Star Resort

at Humpi 1401.50

(v) Cost of acquisition and Operation of existing Hotel/Resort properties at Coorg, Udaipur & Jodhpur on long term lease basis.

542.90

(vi) Cost of setting up Online Travel Portal and Travel Support Station at Gurgaon, Haryana

1049.00

(vii) Cost of acquisition of Tourist Transport Coaches 367.82 Sub Total 5958.84

B. Investment in Additional Working Capital Requirement 845.30 C. Public Issue Expenses [•] D. Contingency Provision 148.97 Total [•]

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MEANS OF FINANCE

Our Company proposes to finance the fund requirement through Public Issue of Equity Shares, Term Loan and Internal accruals, the break up of which is furnished below:

(Rs. in Lacs) S.No. Particulars Amount

A. Proceeds from the present Issue of Equity Shares (including premium) [•] B. Term Loan 846.00 C. Internal Accruals [•] Total [•]

The shortfall, if any, in our capital expenditure may be met with by surplus funds, if any available in the other areas and/or our Company’s internal accrual, and/or working capital loans that may be availed from the banks. The balance proceeds of the Issue in addition to the abovementioned requirements, if any, will be used for general corporate purposes including but not restricted to acquisitions and repayment of loans.

Term Loans from Banks/FIs The total term loan requirement of Rs. 846 Lacs is proposed to be funded by Rupee Term Loan from Banks/FIs. Our Company has received the sanction from Bank of India for Term Loan of Rs. 515 Lacs vide its sanction letter No. NDO.ADV.GK.21/43 dated March 25, 2006 towards construction of our Operational Headquarter and Corporate Office at Gurgaon. We have also received in principle sanction from Kotak Mahindra Primus Ltd. vide their letter dated May 3, 2006, for financing 90% (about Rs.331 Lacs) of the total cost of transport tourist coaches proposed to be purchased by us. We hereby confirm that excluding the amount to be raised through the proposed public issue, firm arrangements of finance through verifiable means towards 75% of the stated means of finance have been made. DETAILS OF USE OF ISSUE PROCEEDS

(i) Construction of Operational Headquarter and Corporate Office at Gurgaon, Haryana Our Company currently owns 2100 sq. metres of land at Institutional Area, Sector 44, Gurgaon, Haryana. Our Company proposes to use the said land for construction of our Operational Headquarter and Corporate Office, which would bring all the business divisions/process of our Company under one roof and help centralized coordination and operation. Our Company has already commenced construction of the office and the same has been financed through internal accruals. Our Company estimates the total cost at Rs.670.59 Lacs, which is based on actual expenditure incurred and the quotations received from suppliers. The details of the same is furnished below:

(Rs. in Lacs) S.No. Particulars Amount

1. Land 163.89 2. Building Construction Cost (40,000 Sq. Ft @ Rs.647 per sq. ft.) 258.80 3. Electrical Installation (a) Central Air conditioning 56.50 (b) Diesel Generator Set 32.00 (c) Lifts 12.00 (d) Transformer and Electrical Panels 18.10 (e) Other Electrical Items 25.50

Subtotal (3) 144.10 144.10

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4. Office Equipments 4.80 5. Furniture & Fixtures 81.00 6. Vehicles 18.00 Total 670.59

(ii) Establishment of ‘Holiday & Travel Solution Stations’ (offices) in various cities of India Our Company proposes to establish ‘Holiday & Travel Solution Stations’ in various locations within India for larger presence and increased network. This would help us in increasing our business operations through customized service to our clients, fulfilling all the travel needs of the client under one umbrella. All these Travel Stations are proposed to be inter- linked through latest networking technology providing Real Time Online Holiday and Travel Solution, including a secured payment gateway. We propose to establish these Stations initially at 10 locations, namely, Mumbai, Goa, Ahmedabad, Hyderabad, Indore, Jaipur, Amritsar, Lucknow, Ranchi and Kolkata. These travel stations will be managed by experienced travel industry professionals, to be employed by our Company, who would market our company’s packaged tours to Indian travellers including Indian Corporate business travellers. They would also set up a network of sub-agents in their respective regions. Our Management estimates the cost of setting up of these offices at Rs. 1155.50 Lacs, the details of which is given below:

(Rs. in Lacs)

S.No. Particulars Amount 1. Office Space (i) Mumbai 1100 Sq. ft. @ Rs.16000 per sq. ft. 176.00 (ii) Goa 1100 Sq. ft. @ Rs.7500 per sq. ft. 82.50 (iii) Ahmedabad 1100 Sq. ft. @ Rs.8500 per sq. ft. 93.50 (iv) Hyderabad 1100 Sq. ft. @ Rs.8500 per sq. ft. 93.50 (v) Indore 1100 Sq. ft. @ Rs.7500 per sq. ft. 82.50 (vi) Jaipur 1100 Sq. ft. @ Rs.8500 per sq. ft. 93.50 (vii) Amritsar 1100 Sq. ft. @ Rs.8000 per sq. ft. 88.00 (viii) Lucknow 1100 Sq. ft. @ Rs.8500 per sq. ft. 93.50 (ix) Ranchi 1100 Sq. ft. @ Rs.7000 per sq. ft. 77.00 (x) Kolkata 1100 Sq. ft. @ Rs.10500 per sq. ft. 115.50

Sub -total 995.50 995.50

2. Furniture & Fixtures Rs.4.50 Lacs per office 45.00

3. Office Equipments Rs.1.50 Lacs per office 15.00

4. Pre-Operative Expenses Rs.2.50 Lacs per office 25.00

5. Advertisement & Brand Promotion Expenses

Rs.7.50 Lacs per office 75.00

Total 1155.50 *Pre-Operative Expenses include Salary and other Office Expenses for 4 months.

The above costs are based on the Management’s own estimation and inquiries and no separate quotation is available.

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(iii) Establishment of Sales and Marketing offices in UK and USA Our Company proposes to establish Sales and Marketing offices, one at London (U.K.) and the other at New Jersey (U.S.A). U.K. and U.S.A together have been the major contributor to the Inbound Tourism in India constituting about 28% of the total Inbound Tourists arrival in India during 2004 calendar year. Further, these two countries have also been the most favoured destinations for Indian Outbound travellers. The establishment of Sales and Marketing offices would help us in establishing direct relationship with local tour operators and travel industry fraternity in these countries. This would contribute to our revenues from Inbound and Outbound tour business from these countries. Our Management estimates the total cost of establishing offices in U.K. and U.S.A at Rs.771.53 Lacs based on the quotations received from Polita Properties, LLC, New Jersey, for USA and 4uZone.Com Ltd., Kent, for U.K. The details of the same is given below:

S. No

Particulars New Jersey (USA)

London (UK)

Total Amount(US$)

Office Space Required (Sq. Ft.) 1400 850 1. Cost of Office Space 300000 400000 700000 2. Furniture & Fixtures 40000 30000 70000 3. Office Equipments (Computers etc.) 7500 10000 17500 4. One Time expenses (a) Advertisement/ Brand Building Campaign 120000 150000 270000 (b) Tourism Fair Participation 80000 100000 180000 (c) Brochure and other Marketing Expenses 100000 120000 220000 (d) Initial traveling for Sales Promotion 30000 40000 70000

Sub total (4) 330000 410000 740000 5. Pre- Operative Expenses (a) Management Visits 25000 20000 45000 (b) Staff Salary for 4 months 36000 36000 72000 (c) Communication & Office Expenses 30000 40000 70000

Sub total (5) 91000 96000 187000 Total US$ 1714500 *Equivalent INR at 1 US$ = INR 45 (Rs. In Lacs) 771.53

(iv) Construction/Commencing Operation of 3 Star Hotel at Jaipur & 3 Star Resort at Humpi Our Company proposes to construct a 3 Star 60 Room Hotel, on Build – Operate - Transfer (BOT) basis at Jaipur (Rajasthan) and a 3-star hotel on Build- Operate- Transfer (BOT) basis at Humpi (Karnataka). We propose to take about 1,59,300 Sq. ft of land on lease in Jaipur and 1,74,240 Sq. ft of land at Humpi for the aforesaid purpose. In this regard, we have already entered into MOUs dated February 18, 2006 and February 9, 2006 respectively with the owners of the land for taking the above referred land on long term lease. The hotels proposed to be constructed at Jaipur & Humpi would be having all the amenities of a 3 Star category hotel. The total construction/Commencing Operation costs of these hotels are estimated at Rs.1401.50 Lacs, details of which is furnished below:-

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(Rs. In Lacs)

S.No. Hotel Site Jaipur Humpi Amount 1. No. of Rooms 60 Rooms 30 Rooms 2. Total Area of Construction 32330 Sq. Ft. 14200 Sq. Ft. 3. Cost of construction (per Sq. Ft.) Rs.1500 Rs.1500 4. Site Development 17.50 ----- 17.50 5. Civil Construction Cost 485.00 213.00 698.00 6. Technical Consultancy Fees 20.00 20.00 40.00 7. Plant & Machinery (Kitchen, Health Club,

Refrigeration etc.) 120.00 153.00 273.00

8. Furniture Fittings and Decorative Items 155.00 48.00 203.00 9. Office Equipments 30.00 8.00 38.00

10. Pre-Operative Expenses (@Rs.3.75 Lacs per month for 12 months)

45.00 45.00 90.00

11. Brand Building/ Advertisement & Publicity 21.00 21.00 42.00 Total 893.50 508.00 1401.50

The above costs are based on the Management’s own estimation and no separate appraisal has been done by any Institution. (v) Acquisition and Operation of existing hotel properties at Coorg, Udaipur and Jodhpur on long term lease basis. Our Company proposes to acquire one resort property at Coorg (Karnataka) and two hotel properties, one each at Udaipur (Rajasthan) and Jodhpur(Rajasthan), on long term lease basis. The details of the same are given below:

Particulars Heritage Resort Paras Mahal Hotel Utsav Location Coorg (Karnataka) Udaipur (Rajasthan) Jodhpur (Rajasthan) Address Plot No. 50/3, Monnageri

Village, Medikeri Taluk, Kodagu District, Karnataka

Sector No.11, Hiran Magri Road, Near Paras Cinema, Udaipur – 313001

Rai Bahadur Bazaar, Jodhpur

Classification Not Classified; However amenities of a 3 Star.

Not Classified; However amenities of a 3 Star.

Not Classified; Budget hotel

No. of Rooms 27 60 41

Our Company has already entered into a MOU dated May 8, 2006, May 1, 2006 and May 1, 2006 with the owners of Heritage Resort, Paras Mahal and Hotel Utsav respectively for transfer of these hotels on long term lease to our Company. ‘Paras Mahal’ hotel at Udaipur and Heritage Resort at Coorg are currently having the amenities of a 3 Star Hotel/Resort, while Hotel Utsav at Jodhpur is a budget hotel. Our Management estimates that we would require a total amount of Rs.479.90 Lacs for payment of one time long term lease deposit for the above- said hotels and Rs.63 Lacs towards Brand Building/ Advertisements for the aforesaid Hotels, the break up of which is furnished below:

(Rs. in Lacs) Particulars ‘Heritage Resort’

Coorg ‘Hotel Utsav’

Jodhpur ‘Paras Mahal’

Udaipur Amount

Lease Period (from date of execution of Agreement)

10 years 30 years 30 years

One time Lease Deposit 168.10 77.40 234.40 479.90 Brand Building/ Advertisement & Publicity

21.00 21.00 21.00 63.00

Total 189.10 98.40 255.40 542.90

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(vi) Cost of setting up Online Travel Portal and Travel Support Station at Gurgaon, Haryana

Our Company proposes to establish an Online Travel Portal by the name www.indiahollidaymall.com, as a natural extension of our existing business operations. The Portal would be a “One Stop Travel Solution” for domestic and international travellers. It would allow domestic/international travellers to customise his holiday/business trip, which would include air ticketing, hotel reservation, Transport etc. at good value for money and with a secure and safe online payment mechanism. The USP of the Portal would be “make my dream holiday”. Further, we also propose to establish a Travel Support Station at Gurgaon (Haryana), which would cater to the variety of customer queries and needs on 24 X 7 basis. The Travel Support station would be equipped with Toll Free telephone lines (512 Kbps IPLC line) from four countries viz. US, Canada, UK and India. It would be having 36 Channel Service Units (CSU) terminals with the following software:-

(i) Central Reservation System (CRS) software supported by Amadeus/Sabre/Abacus which would facilitate checking and booking airlines seats on real time basis.

(ii) Human Click, a Chat software which would allow customers to interact at on a 24 X 7 basis with the CSUs.

(iii) E-11, a Customer Relationship Management (CRM) Software, which records customer interactions and data/information, collates the information on one platform and recognizes customers on the basis of that information to simplify and customise the user experience.

(iv) Enterprise Resource Planning (ERP) Software which would help in integrating departments and functions across our company into one computer system. It will enable various departments to share information and communicate with each other. ERP systems comprise function-specific modules designed to interact with the other modules, e.g. Accounts Receivable, Accounts Payable, Purchasing, etc. It will help to generate various MIS with the shared information from all the departments.

The Travel Support Station is also further proposed to be used for providing services to various airlines and hotels and other tour operators for generating additional business revenue. Our Management estimates the total cost of setting up the Online Travel Portal and Travel Support Station at Rs.1049 Lacs, the details of which is furnished below:-

(Rs. In Lacs)

S.No. Details of Cost Amount Total Amount 1. Online Travel Portal and Travel Support Station (a) Computer Hardware (i) Servers – 4 Nos. @Rs.3 Lacs each 12.00 (ii) Computers – 50 Nos. @ Rs.0.40 Lacs each 20.00 (iii) Printers & Scanners – 5 Nos. @Rs.1.20 Lacs each and Projector and UPS 20.80 52.80

(b) Computer Software (i) Online Travel Portal development – Indiaholidaymall.com 40.00 (ii) CRM Software (E-11) 98.00 (iii) ERP/Workflow Software 100.00 (iv) CRS supported by Amadeus/Sabre/Abacus Booking Engine 60.00 (v) API for Portal connectivity to different GDS and Booking Engines 50.00 353.00

(c) Travel Support Station Equipments & Technology (i) EPABX- ACD Switch 90.00 (ii) Web based Server and Data Based Server 49.50

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(iii) Interactive Voice Response (IVR) Server with dialog Card 37.00 (iv) Central and Remote Router 6.90 (v) Installation, Modem, Phone, instrument etc.) 25.00 (vi) NMS Software to monitor the traffic of our Travel Support Station 0.80 (vii) Computer Telephony Integration (CTI) Software license 9.00 (viii) IVR License for 100 ports 10.00 228.20

2. Furniture & Fittings 51.00 3. Security Deposit with 8 Airlines for Online Air Bookings 160.00 4. Marketing, Brand Building & Launching expenses 189.00 5. Pre-Operative Expenses 15.00 Total 1049.00

Our Company currently owns 2100 sq. metres of land at Plot No.56, Sector 44, Gurgaon, Haryana on which we have commenced construction of our Operational Headquarter and Corporate office. The Online Travel Portal and Travel Support Station is proposed to be operated from our Corporate Office premises. (vii) Purchase of Tourist Transport Coaches Our Company proposes to acquire 13 Nos. Tourist Transport Coaches to facilitate and support the increased operations of our Company in the Inbound, Outbound and domestic tourism. The total cost of these Tourist Transport Coaches has been estimated by our Management at Rs. 367.82 Lacs based on the quotation received from the suppliers. The details of the same are:

(Rs. In Lacs) Tourist Transport Coaches Nos. Cost per unit Amount Volvo Bus (B7R Chasis) powered by a 260HP, Euro Compliant Diesel Engine.

5 63.00 315.00

Tempo Traveller Mini Bus - 3350 MM WB with Turbo Charged Diesel Engine

3 5.94 17.82

Special Utility Vehicle (SUV) - Toyota Innova 5 7.00 35.00 Total 367.82

B. Investment in Additional Working Capital Requirement Our anticipated business growth, mainly from the area of Inbound, Outbound and domestic tourism would push up our working capital requirement on account of the higher margins to be maintained, longer credit period to be offered to our clients, and miscellaneous current assets. As per our internal estimate, the incremental requirement for the working capital would be Rs. 845.30 Lacs, which we plan to finance entirely by the proceeds of this Issue. The basis of estimation of working capital is given below:

Particulars Holding Period Days Sundry Debtors - 60 days for inbound travel business

- 15 days for outbound and domestic travel business - 7 days for Hotel division

Inventory (Hotel Division) - 7 days Advance for Reservations - 45 days of Tour Operations Sundry Creditor - 21 days of Tour Operations

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C. Public Issue Expenses Issue related expenses includes Issue management fees, selling commission, distribution expenses, legal fees, printing and stationery costs, advertising expenses and listing fees payable to the Stock Exchanges etc. The total expenses for the Issue are estimated at Rs. [•], which is [•] % of the Issue size. All the Issue related expenses shall be met out of the proceeds of the Issue. The break up of the same is as follows:-

S.No. Description Amount

(Rs. in Lacs) % of total Issue Expenses

1. Lead Managers Fees, Underwriting & Selling Commission [•] [•] 2. Advertisement & Marketing Expenses [•] [•] 3. Printing & Stationery, Distribution, Postage, etc. [•] [•] 4. Other Expenses (Inclusive of fees of Registrar, Legal Advisor,

Filing Fess, Listing Fees, Depository Charges etc.) [•] [•]

Total [•] [•] D. Provision for Contingency Our Company has estimated Rs.148.97 Lacs towards contingencies, which is calculated @2.5% of the total Capital Expenditure on Expansion Project. This would be used to mitigate any shortfall in estimating the outlays envisaged in the requirement of funds for business expansion and contingencies arising out of foreign exchange fluctuations. SCHEDULE OF IMPLEMENTATION The details of schedule of implementation is as follows:-

S.No. Activity Start Date Completion Date

1. Construction of Operational Headquarter and Corporate Office at Gurgaon

Already Started June 2006

2. Establishment of 10 Holiday & Travel Solution Stations within India

Already Started October 2006

3. Establishment of Sales & marketing offices in USA & UK July 2006 September 2006 4. Establishment of 3-Star Hotels at Jaipur and Humpi under BOT

concept July 2006 October 2007

5. Taking over on Lease 2 Hotel property and 1 Resort Property at Jodhpur, Udaipur and Coorg respectively

July 2006 August 2006

6. Launching of Online Travel Portal - indiaholidaymall.com and Travel Support Station at Gurgaon.

July 2006 October 2006

7. Acquisition of additional tourist transport coaches July 2006 October 2006 8. Brand Building and Advertisement Campaign May 2006 December 2007

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FUNDS DEPLOYED As per the certificate dated May 15, 2006 of our auditors M/s SNR & Co., Chartered Accountants, our Company has spent Rs. 506.91 Lacs as on March 31, 2006 for the expansion project entirely out of our internal accruals. The details of the amount spent are as follows:

S.No. Description Funds Deployed (Rs. In Lacs)

1. Cost of construction of Operational Headquarter and Corporate Office at Gurgaon, Haryana

374.23

2. Cost of establishment of ‘Holiday & Travel Solution Stations’ (offices) in various cities of India

2.95

3. Cost of acquisition and Operation of existing Hotel/Resort properties at Coorg, Udaipur & Jodhpur on long term lease basis.

100.00

4. Cost of setting up Online Travel Portal and Travel Support Station at Gurgaon, Haryana

15.48

5. Public Issue Expenses 14.25 Total 506.91

INTERIM USE OF PROCEEDS

Pending use of funds as described above, we intend to invest the proceeds of the Issue in high quality, interest / dividend bearing short term / long term liquid instruments including money market mutual funds, deposits with banks for the necessary duration, gilt edged securities and other ‘AAA+’ rated interest bearing securities as may be authorised by our Board or a duly authorised committee thereof.

MONITORING OF UTILISATION OF FUNDS The audit committee appointed by the Board of Directors will monitor utilization of Issue Proceeds. No part of the Issue proceeds will be paid by us as consideration to our Promoters, Directors, key management personnel or companies promoted by our Promoters except in the course of normal business.

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BASIC TERMS OF ISSUE

The Equity Shares being issued are subject to the provisions of the Companies Act, our Memorandum and Articles, the terms of this Prospectus, Application Form and other terms and conditions as may be incorporated in the allotment advice and other documents/ certificates that may be executed in respect of the Issue. The Equity Shares shall also be subject to laws, as applicable, guidelines, notifications and regulations relating to the issue of capital and listing of securities issued from time to time by SEBI, Government of India, Stock Exchanges, RBI, Registrar of Companies and/or other authorities, as in force on the date of the Issue and to the extent applicable.

ISSUE STRUCTURE Public Issue of 85,72,000 Equity Shares of face value Rs. 10/- each at a price of Rs. [•] for cash at a premium of Rs. [•] per Equity Share aggregating Rs. [•] Lacs (hereinafter referred to as the “Issue”). The Issue is being made through the 100% Book Building Process.

Particulars QIBs Non Institutional Bidders Retail Individual Bidders Number of Equity shares (available for allocation)*

Upto 42,86,000 Equity Shares

Atleast 12,85,800 Equity Shares

Atleast 30,00,200 Equity Shares

Percentage of Issue available for allocation

Upto 50% of the Issue. 5% of the QIB portion shall be available for allocation to Mutual Funds participating in the 5% reservation in the QIB portion and will also be eligible for allocation in the remaining QIB portion. The unsubscribed portion in the Mutual Fund reservation will be available to QIBs.

Atleast 15% of the Issue or Issue less allocation to QIBs and Retail Individual Bidders

Atleast 35% of the Issue or Issue less allocation to QIBs and Non Institutional Bidders

Basis of allocation if respective category is oversubscribed

Proportionate as follows: (a)2,18,800 Equity Shares constituting 5% of the Qualified Institutional Buyer Portion shall be allocated on a proportionate basis to Mutual Funds (b)41,57,200 Equity Shares shall be allocated on a proportionate basis to all QIBs including Mutual Funds receiving allocation as per (a) above.

Proportionate Proportionate

Minimum Bid Such no. of Equity shares in multiples of [•] Equity Shares thereafter so that the bid amount exceeds Rs. 1,00,000/-

Such no. of Equity shares in multiples of [•] Equity Shares thereafter so that the bid amount exceeds Rs. 1,00,000/-

[•] Equity shares

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Maximum Bid Such number of Equity Shares not exceeding the Issue Size, subject to applicable limits

Such number of Equity Shares not exceeding the Issue Size, subject to applicable limits

Such number of Equity Shares in multiples of [•] Equity Shares whereby the bid amount does not exceed Rs. 1,00,000/-

Mode of allotment Compulsorily in Dematerialized from

Compulsorily in Dematerialized from

Compulsorily in Dematerialized from

Trading Lot/Market Lot One Equity Share One Equity Share One Equity Share Who can apply** Public financial institutions,

as specified in section 4A of the Companies Act, scheduled commercial banks, mutual funds, foreign institutional investors registered with SEBI, venture capital funds registered with SEBI, Foreign Venture Capital Investors registered with SEBI and State Industrial Development Corporations, insurance companies registered with the Insurance Regulatory and Development Authority, provident funds with minimum corpus of Rs. 250 million and pension funds with minimum corpus of Rs. 250 million.

Resident Indian individuals, HUFs (in the name of Karta), companies, corporate bodies, NRIs, societies

Individuals including NRIs and HUFs (in the name of the Karta) applying for such number of Equity Shares such that the bid amount does not exceed Rs. 1,00,000/-

Terms of Payment Margin Amount applicable to QIB Bidders at the time of submission of Bid cum Application Form to the members of the Syndicate

Margin Amount applicable to Non Institutional Bidders at the time of submission of Bid cum Application Form to the members of the Syndicate

Margin Amount applicable to Retail Individual Bidders at the time of submission of Bid cum Application Form to the members of the syndicate

Margin Money 10% of the bid amount in respect of bids placed by the QIB bidder

Full bid amount on bidding Full bid amount on bidding

* Subject to valid bids being received at or above the Issue Price, under–subscription, if any, in any category would be allowed to be met with spill over interse from any other category, at the sole discretion of our Company in consultation with the BRLMs. **In case the Bid cum Application Form is submitted in joint names, the investors should ensure that the demat account is also held in the same joint names and are in the same sequence in which they appear in the Bid cum Application Form. Withdrawal of the Issue Our Company in consultation with the BRLMs reserves the right not to proceed with this Issue any time after the Bid/Issue opening date but before allotment without assigning any reason thereof.

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Bid/Issue Programme BID/ISSUE OPENS ON [●] BID/ISSUE CLOSES ON [●] Bids and any revision in Bids shall be accepted only between 10 a.m. and 3 p.m. (Indian Standard Time) during the Bidding Period as mentioned above at the bidding centres mentioned on the Bid-cum-Application Form except that on the Bid/Issue Closing Date, the Bids shall be accepted only between 10 a.m. and 1 p.m. (Indian Standard Time) and uploaded till such time as permitted by BSE and NSE on the Bid/Issue Closing Date. The Price Band will be decided by our Company in consultation with the BRLMs Our Company reserves the right to revise the Price Band during the Bidding Period in accordance with SEBI Guidelines. The cap on the Price Band should not be more than 20% of the floor of the Price Band. Subject to compliance with the immediately preceding sentence, the floor of the Price Band can move up or down to the extent of 20% of the floor of the Price Band advertised at least one day prior to the Bid Opening Date/Issue Opening Date. In case of revision in the Price Band, the Bidding/Issue Period will be extended for three additional days after revision of Price Band, subject to the Bidding Period/Issue Period not exceeding ten working days. Any revision in the Price Band and the revised Bid/Issue Period, if applicable, will be widely disseminated by notification to BSE and NSE by issuing a press release, and also by indicating the change on the web site of our Company and/or the BRLMs and at the terminals of the Syndicate Member.

33

BASIS OF ISSUE PRICE The Price Band will be decided prior to the filing of the Red Herring Prospectus with the RoC. The Issue Price will be determined by our Company in consultation with the BRLMs, on the basis of assessment of market demand for our Equity Shares by way of the Book Building process. Investors should read the following summary with the Risk Factors included from page number ix and the details about the Company and its financial statements included in this Prospectus. The trading price of the Equity Shares of the Company could decline due to these risks and you may lose all or part of your investments. Qualitative Factors Our Company has been in the business of providing Tours and Travel Services to the Inbound foreign tourists

visiting India for the last 18 years. We are also providing Tours & Travel Services to the Outbound Indian Tourists traveling abroad and domestic tourists traveling within India.

We provide services to clients from 26 countries across the globe which include Germany, Holland, Austria,

Sweden, Finland, Denmark, Brazil, USA, Spain and East European countries. We are now handling over 10000 clients from various countries on annualized basis.

We have obtained ISO 9001-2000 accreditions which reflects our commitment to strong quality systems and

compliance to international standards. Our Company is recognized by the Ministry of Tourism and Culture, Department of Tourism as ‘Approved Tour

Operator’. We have received many awards and Certificates of Merit since 1992 for achievements / excellence in

promoting Tourism in India. This includes Second position in 2nd category for the year 2003-04 and 3rd position in 1st category for the year 2001-02. We have been actively engaged in promoting the culture of our country by providing festival tours, Wildlife Safari, Camel Safaris, Ayurveda Tours etc., in addition to routine tour packages.

We have been the 3rd highest foreign exchange earner in category of recognized inbound tour operators for the

year 2001-02. We have earned about INR 1670.40 Million worth of Foreign exchange in the past decade. We are having business relationships with world-renowned tour operators like GeBeCo (Germany), Djoser

(Holland), Insight Reisen (Switzerland) and Joe Far (Austria) since the last 9 years. We are controlled and managed by a team of experienced and professional management team with versatile

experience relevant to the industry. We are active member of various Indian and Overseas reputed Tourism Organisations

like American Society of Travel Agents (ASTA), Pacific Asia Travel Association (PATA), German Association of Travel Agents (DRV), Confederacion de Organizacioues Touristicas de la America Latina (COTAL), United States Tour Operators Association (USTOA), India Association of Tour Operators (IATO).The memberships of these associations help our Company in making contacts with agents in these countries and opportunity to participate in trade shows, events.

34

Quantitative Factors

1. Adjusted Earning per Share (EPS)

Year ended EPS (Rs.) Weight used31.03.2003 0.48 1 31.03.2004 1.06 2 31.03.2005 1.74 3

*28.02.2006 2.42 Weighted Average

*11 Month period ended February 28, 2006.

Note: (i) The Earning per Share has been computed on the basis of the restated profits and losses of the respective

years. (ii) The denominator considered for the purpose of calculating Earnings per Share is the weighted average

number of Equity Shares outstanding during the year. (iii) The denominator considered for the calculation of EPS for the Eleven Month period ended February 28,

2006, is 90,00,000 Equity Shares. The earnings for 11-month period ending on February 28, 2006, have not been annualized.

2. Price/Earning (P/E) ratio in relation to Issue Price of Rs. [•] per share:

a. Based on year ended March 31, 2005 EPS of Rs. 1.74/- is [•]

b. P/E for Tourism Industry

Highest 42.9Average 39.4Lowest 17.1

(Source: Capital Market Vol.XXI/05, May 8 – May 21, 2006. Segment: Travel Agencies)

3. Weighted Average Return On Net Worth (RONW):

Year ended RONW (%) Weight Used 31.03.2003 3.10% 1 31.03.2004 6.49% 2 31.03.2005 9.13% 3

Weighted Average 7.25% 4. Minimum RONW required on increased Net Worth to maintain pre issue EPS (%): [•]

5. Net Asset Value (NAV) per Equity share:

Net Asset Value (NAV) per Equity share Rs. As on March 31, 2005 16.96 As on February 28, 2006 19.37 After the issue [•]

35

6. Comparison with Industry Peer set

Name of the Company B.V. (Rs.) EPS (Rs.) P/E RONW%Indo Asia Leisure Services Limited.¹ 19.37 2.42 [•] 12.48

Peer Group² International Travel House 52.50 6.00 27.10 11.30Thomas Cook (India) Ltd. 112.00 17.80 42.90 17.60Transcorp India Limited 20.50 2.10 17.10 11.00 1 B.V, EPS and RoNW% for our Company are based on 11 months earnings for the period ending February 28, 2006 and are not annualized and as per the restated audited financial statements prepared by our statutory auditor, SNR & Co, Chartered Accountants. For details, please refer to the section titled “Financial Statements” beginning on page no. 87 of this Draft Red Herring Prospectus. 2 Information for Peer Group has been taken from Capital Market Vol.XXI/05, May 8 – May 21, 2006. Segment: Travel Agencies

7. The Issue Price is [•] times of the Face Value of Rs. 10/- per Equity Share

The issue price will be determined on the basis of the demand from the investors in accordance with the SEBI Guidelines. The BRLMs believe that the Issue price of Rs. [•] is justified in view of the above qualitative and quantitative parameters. Please refer to the section titled ‘Risk Factors’ beginning from page no. ix of this Draft Red Herring Prospectus and the financials of our Company as set out in the section titled ‘Financial Statements’ on page no. 87 of this Draft Red Herring Prospectus to have a more informed view.

36

STATEMENT OF TAX BENEFITS Our Company’s statutory auditors M/s. SNR & Co.., Chartered Accountants have vide their certificate dated May 3, 2006 certified the tax benefits available to our Company. The contents of this certificate are reproduced below: We hereby certify that the enclosed annexure states the tax benefits available to Indo Asia Leisure Services Limited (the “Company”) and to the Shareholders of the Company under the provisions of Income Tax Act, 1961 and other direct and indirect tax laws presently in force. The contents of this annexure are based on information, explanations and representations obtained from the company and on the basis of our understanding of the business activities and operations of the company. A Shareholder is advised to consider in his /her/ its own case, the tax implications of an investment in the equity shares particularly in view of the fact that certain recently enacted legislation may not have a direct legal precedent or may have a different interpretation on the benefits, which an investor can avail. For SNR & CO. Chartered Accountants Suresh Vyas Partner Membership No.: 82658 Date: 03.05.2006 Place: New Delhi

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The Following tax benefits shall be available to the Company and the prospective shareholders under Indian direct and indirect tax laws.

A. To the Company A1. Under the Income Tax Act, 1961 (“IT Act”)

1. Under Section 115JAA (1A) credit shall be allowed of any MAT paid under section 115JB of the IT Act for any Assessment Year commencing on or after 1st April 2006. Credit eligible for carry forward is the difference between MAT paid and the tax computed as per the normal provisions of the IT Act. Such MAT credit shall be available for set – off up to 5 years succeeding the year in which the MAT credit initially arose.

2. By virtue of Section 10(34) of the IT Act, income earned by way of dividend income referred to in Section 115 – O of the IT Act, from another domestic company is exempt from tax.

3. The corporate tax rate shall be 30% and surcharge on tax shall be 10% (plus Education Cess). 4. Under Section 32 of the IT Act, the rates of depreciation on furniture and fittings would normally

be10%, motorcars 15% and coaches 30%. 5. In addition to Income Tax, a Fringe Benefit Tax at the rate of 30% (plus surcharge and education

Cess) would be payable in respect of Fringe Benefits provided / deemed to the employees. A2. Under the Service Tax Act

1. In terms of Notification No. 8 / 2004 – S.T. dated 09.07.2004, 60% of the gross amount charged for taxable services (other than service in relation to a package tour) provided by a tour operator is exempt from service tax.

2. In terms of Notification No. 39 / 1997 – S.T. dated 22.08.1997, 60% of the gross amount charged for taxable services provided in relation to a package tour provided by a tour operator is exempt from service tax.

3. In terms of Notification No. 40 / 1997 – S.T. dated 22.08.1997, 90% of the gross amount charged for taxable services provided in relation to accommodation provided by a tour operator is exempt from service tax.

4. Under the Service Tax Act, the Company is liable to pay service tax @ 10.20% ( 12.24% w.e.f. 18.04.2006) on the gross amount received from all services provided other than those mentioned in clauses 1, 2, 3 above.

5. By virtue of Rule 3 of The Cenvat Credit Rules, 2004, the Company is entitled to avail tax credit on input services received and consumed in providing output service and capital goods used in providing any output service.

A3. Benefits under the Export Import Policy

1. Import of Capital goods under Export Promotion Capital Goods scheme (EPCG scheme) at concessional rate of duty.

B. To the Members of the company B1. Under the Income Tax Act, 1961

38

Resident Members

1. By virtue of Section 10(34) of the IT Act, income earned by way of dividend from domestic company referred to in Section 115O of the IT Act are exempt from tax in the hands of the shareholders.

2. In terms of section 10(38) of the Act, any long-term capital gains arising to a shareholder from transfer of long-term capital asset being an equity share in a Company would not be liable to tax in the hands of the shareholder if the following conditions are satisfied:

a) The transaction of sale of such equity shares is entered into on or after 10th September 2004 b) The transaction is chargeable to such securities transaction tax as explained below.

3. In terms of section 10(23D) of the IT Act, all Mutual Funds set up by Public Sector Banks or Public

Financial Institutions or Mutual Funds registered under the Securities and Exchange Board of India or authorised by the Reserve Bank of India, subject to the conditions specified therein are eligible for exemption from income tax on all their income, including income from investment in the shares of the Company.

4. Under section 48 of the IT Act, if the Company’s shares are sold after being held for more than 12 months, the gains (in cases not covered under section 10(38) of the Act), if any, will be treated as long term capital gains shall be calculated by deducting from the gross consideration, the indexed cost of acquisition.

5. Under section 54EC of the Act and subject to the conditions and to the extent specified therein, long term capital gains (in cases not covered under section 10(38) of the Act) arising on the transfer of shares of the company will be exempt from capital gains tax if the capital gains are invested within a period of six months after the date of such transfer for a period of at least three (3) years in bonds issued by:

a) National Bank for Agriculture and Rural Development established under section 3 of The

National Bank for Agriculture and Rural Development Act, 1981 (before 01.04.2006); b) National Highway Authority of India constituted under section 3 of The National Highway

Authority of India Act, 1988; c) Rural Electrification Corporation Limited, the company formed and registered under the

companies Act, 1956; d) National Housing Bank established under section 3(1) of the National Housing Bank Act,

1987(before 01.04.2006);and e) Small Industries Development Bank of India established under section 3(1) of the Small

Industries Development Bank of India Act, 1989 (before 01.04.2006). 6. Under section 54ED of the Act and subject to the conditions and to the extent specified therein, long

term capital gains, (in cases not covered under section 10(38) of the Act) on the transfer of shares of the Company, as and when it is listed, will be exempt from capital gains tax if the capital gains are invested in shares of an Indian Company forming part of eligible public issue, within a period of 6 months after the date of such transfer and held for a period of at least one year. Eligible public issue means issue of shares equity which satisfies the following conditions, namely –

a) the issue is made by a public company formed and registered in India; b) the shares forming part of the issue are offered for subscription to the public.

7. Under Section 54F of the Act, Long term capital gains (in cases not covered under section 10(38) of

the Act) arising to an individual; or Hindu Undivided Family (HUF) on transfer of shares of the Company will be exempt from capital gains tax subject to other conditions, if the net consideration from such shares are used for purchase of residential house property within a period of one year before and two years after the date on which the transfer took place or for construction of residential house property within a period of three years after the date of transfer.

39

8. In terms of Securities Transaction Tax as enacted by Chapter VII of the Finance (No. 2) Act, 2004, transaction for purchase and sale of the securities in the recognized stock exchange by the shareholder shall be chargeable to securities transaction tax. As per the said provisions, any delivery based purchase and sale of equity share in a company through the recognized stock exchange is liable to securities transaction tax @ 0.10% (0.125% w.e.f. 01.06.2006) of the value payable by both buyer and seller. The non - delivery based sale transaction are liable to tax @ 0.02 %(0.025% w.e.f. 01.06.2006) of the value payable by the seller.

9. In terms of Section 88E of the Act, the securities transaction tax paid by the shareholder in respect of the taxable securities transaction entered into in the course of his business would be eligible for rebate from the amount of income - tax on the income chargeable under the head “Profits and gains from business or profession” arising from taxable securities transactions. As such, no deduction will be allowed in computing the income chargeable to tax as capital gains, such amount paid on account of securities transaction tax.

10. Under Section 112 of the Act and other relevant provisions of the Act, long term capital gains (i.e. if

shares are held for a period exceeding 12 months) (in cases not covered under section 10(38) of the Act), arising on transfer of shares in the Company, shall be taxed @ 20% (plus applicable surcharge) after indexation as provided in the second proviso to section 48. The amount of such tax should however, be limited to 10% (plus applicable surcharge) without indexation, at the option of the shareholder, if the transfer is made after listing of shares.

11. Under section 111A of the Act and other relevant provisions of the Act, short - term capital gains (i.e.

if shares are held for a period not exceeding 12 months), arising on transfer of shares in the company on a recognized stock exchange, shall be taxed @ 10% (plus applicable surcharge).

Non – Resident Indians / Non – Resident Shareholders (Other than FIIs)

Apart from the benefits as mentioned in points 1,2,3,4,7,8 and 9 of B1 above

12. Under section 115 - I of the Act, the non - resident Indian shareholder has an option to be governed by the provisions of Chapter XII - A of the Income Tax Act, 1961 viz. “Special Provisions Relating to Certain Incomes of Non - Residents” which are as follows: -

a) Under section 115E of the Act, where shares in the Company are acquired or subscribed for in

convertible Foreign Exchange by a Non- Resident Indian, capital gains arising to the non- resident on transfer of shares held for a period exceeding 12 months on a recognized stock exchange, shall (in cases not covered under section 10(38) of the Act) be concessionally taxed @ 10 % (plus applicable surcharge) (without indexation Benefit but with protection against foreign exchange fluctuation).

b) Under section 115F of the Act, long term capital gains (in cases not covered under section 10(38) of the Act) arising to a non- resident Indian from the transfer of shares of the Company subscribed to in convertible Foreign Exchange (in cases not covered under section 115E of the Act) shall be exempt from Income tax, if the net consideration is reinvested in specified assets within 6 months of the date of transfer. If only part of the net consideration is so reinvested, the exemption shall be proportionately reduced. The amount so exempted shall be chargeable to tax subsequently, if the specified assets are transferred or converted into money within 3 years from the date of their acquisition.

40

Foreign Institutional Investors (FIIs) Apart from the benefits as mentioned in points 1,2,3,4,7 and 8 of B1 above

13. The income by way of short term capital gains (not covered under section 10(38) of the Act) realized by FIIs on sale of shares in the company would be taxed at the following rates as per Section 115AD of the Income Tax Act, 1961.

a) Short term capital gains – 30% (plus applicable surcharge) b) Long term capital gains – 10% (without cost indexation plus applicable surcharge).

(Shares held in the Company would be considered as a long-term capital assts provided they are held for a period exceeding 12 months)

B2. Under the Wealth Tax Act, 1957

14. Shares held in a Company will not be treated as an asset within the meaning of Section 2(ea) of Wealth Tax Act, 1957; hence Wealth Tax Act will not be applicable.

B3. Under the Gift Tax Act, 1958

15. Gifts made after 1st October 1998 is not liable for any gift tax and hence gift of shares of the company would not be liable for any gift tax.

Notes:

1) All the above benefits are as per the current tax law as amended by the Finance (No.2) Act, 2006. The shares are held by joint holders

2) In respect of non - residents, the stated benefits will be available only to the sole / first named holder in case the tax rates and the consequent taxation mentioned above shall be further subject to any benefits available under the Double Taxation Avoidance Agreement, If any, between India and the country in which the non - resident has fiscal domicile.

33)) 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.

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SECTION IV - ABOUT OUR COMPANY

The information presented in this section has been extracted from various publicly available documents and sources, including officially prepared materials from the Government and its various ministries and has not been prepared or independently verified by the Issuer or the BRLMs. INDUSTRY OVERVIEW Travel and Tourism industry is one of the largest industries in the world today, responsible for employing more than 200 million people and generating over 10 per cent of global GDP. It provides a gateway to economic progress particularly in areas having limited options. The diversity of India’s natural and cultural richness provides the basis of a wide range of tourist products and experiences, which embraces business, leisure, culture, adventure, spirituality, eco tourism and many other pursuits. In recent years, India has emerged as a destination for natural and eco tourism and adventure tourism. With 4.5% of its land area under some form of legal protection, India can boast of a large number of national parks and game sanctuaries rich in flora and fauna. The country’s 6000 KM long coastline has exquisite sandy beaches. The emergence of India as a strong scientific and technological power has brought in its wake a special brand of tourists to India who participates in national and international scientific and technical gatherings. Our country is becoming as one of the fastest growing tourist destinations in the world. Even with the present volumes of international tourist traffic, tourism has already emerged as an important segment of our country’s economy. Our country received around 3.91 million visitors in 2005 while the outbound travel was estimated at 7 million visitors in 2005. According to Department of Tourism, in the first four calendar months of 2006, the number of foreign tourist arrival has been estimated at about 1.6 Million showing an increase of 14.4% over the corresponding period last year. The foreign exchange earnings from tourism stood at Rs.25172 Crs. for the calendar year 2005 as compared to Rs.21603 Crs. in 2004 showing an increase of 16.5%. In the first four calendar months of 2006, these earnings are estimated at Rs. 9919.81 Crs. showing an increase of 16.3% in comparison to same period in the last year. While according to WTTC 2005 Report, the Travel &Tourism demand from the country accounts for a miniscule 0.7 per cent of the global pie, it is viewed as an emerging star in this region and is generating avid interest among investors and service providers viz. airlines and hotels. (Source: Department of Tourism; WTTC 2005 Report; Business Standard 15.04.2006) The growth in Tourism in India can be attributed to 3 areas viz. Inbound Tourism, Outbound Tourism and Domestic Tourism. The same is explained as under: Inbound Tourism Focused marketing of tourism products and branding of India as a high value destination, policies targeted at strengthening of tourism infrastructure by the Ministry of Tourism have been responsible for a healthy growth in international tourist arrivals to India. Over the years, the arrival of foreign tourists has grown from about 17,000 in 1951 to 1.68 Million in 1991 and to 3.91 Million in 2005. The Numbers include both business and leisure travelers and people of Indian origin traveling to meet family. The growth in number of foreign tourist arriving in India is shown in the graph given below:

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Foreign Tourist Arrival in India (in Million)

1.681.87

1.761.89

2.212.29

2.372.36

2.482.65

2.542.38

2.733.37

3.91

1991

1993

1995

1997

1999

2001

2003

2005

Year

s

(Source: Ministry of Tourism and Culture, Department of Tourism)

Foreign tourism arrivals in India has grown by more than 16% in 2005 over 2004, primarily as a result of economic growth in EU and US, a strong business climate in India and aggressive promotion efforts by the Indian government. As the dollar was depreciating against world currencies, the relatively more affordable destinations such as India gained in popularity. The flow of tourists into India has been mainly from USA and UK. They together constitute about 28% of the total number of foreign tourist arrivals in India during 2004. Other countries Sri Lanka, France, Canada, Germany, Japan, Malaysia, Australia and Italy are the other major international markets from which foreign tourists arrive in India. The top ten international tourist markets for India during 2004 is shown below:

Country No. of VisitorsU.S.A. 468340 U.K. 459206 Sri Lanka 130979 France 129044 Canada 118070 Germany 96970 Japan 96920 Malaysia 71622 Australia 68944 Italy 60992 Others 1666893 Total 3367980*

International Markets for India during 2004

14%

14%

4%

4%

4%

3%3%

2%2%2%

48%

U.S.A.

U.K.

Srilanka

France

Canada

Germany

Japan

Malaysia

Aust ralia

It aly

Ot hers

(Source: Ministry of Tourism and Culture, Department of Tourism)

*Provisional

The major tour operators operating in the Inbound Sector, other than our Company are:- a. Sita – Kuoni World Travel Limited b. La Passage to India (LPTI) c. Cox n Kings d. Travel Corporation of India (TCI) e. Creative Travels

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Domestic Tourism Apart from foreign tourists, the number of domestic tourist visits in India have also grown significantly over the years. Domestic tourist visits have grown at a CAGR of about 14% over the period 1999 to 2004. The number of domestic tourist visits have increased from 66.7 Million in 1991 to 367.6 Million in 2004. The growth in number of domestic tourist visits in India is shown in the graph given below:

Domestic Tourist Visits

66.7 81.5105.8

127.1 136.6 140.1159.9 168.2

190.7220.1 236.5

269.6309.0

367.6

050

100150200250300350400

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

Years

No.

of V

isits

(in

Mill

ion)

Domestic Visits

(Source: Ministry of Tourism and Culture, Department of Tourism) The main reason for undertaking domestic trips in India is for Social purpose (e.g. visiting relatives and friends), religious trips and Leisure trips. The share of Uttar Pradesh and Andhra Pradesh, in number of domestic tourist visits is the highest at 25% share each in the total domestic tourist visit, followed by Tamilnadu at 12%, Karnataka at 7% and Rajasthan at 4%.

Share of State/UT in Domestic Tourist Visits - 2004

25%

25%

12%7%

4%

4%

3%

3%

2%

2%13%

Uttar Pradesh

Andhra Pradesh

Tamilnadu

Karnataka

Rajasthan

Maharashtra

West Bengal

Utttranchal

Madhya Pradesh

Bihar

Others

(Source: Ministry of Tourism and Culture, Department of Tourism)

44

The major tour operators operating in the Domestic Visit Sector are:- a. Cox n Kings b. Kesri Travels c. Raja Rani Travels Outbound Tourism Outbound tourists have increased steadily over the last 5 years, driven by declining overseas air fares and increasing disposable income. The number of Outbound tourist visits have increased from 1.9 Million in 1991 to 6.2 Million in 2004. The growth in number of Outbound tourist visits from India during the period 1991 to 2004 is shown in the graph given below:

Indians National Going Abroad (In Millions)

1.9

2.2

2.7

2.7

3.1

3.5

3.7

3.8

4.1

4.4

4.6

4.9

5.4

6.2

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

Year

s

(Source: Ministry of Tourism and Culture, Department of Tourism) According to Business standard dated April 15, 2006 around 7 million people travelled abroad during 2005. According to estimates, the country's outbound travelling rate is going up by 15-20% per annum while the World Tourism Organisation estimates the numbers to reach 50 million by 2020. (Economic Times dt. 08/05/2006) The major tour operators operating in the Outbound Sector are:- a. Sita – Kuoni World Travel Limited b. Thomas Cook c. Cox n Kings d. Raj Travels e. Orbit

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Growth in Hotel Industry The growth in tourism has been accompanied by the revival of hotel projects, both luxury and two and three-star properties. Till the end of December 2004, there were 1892 hotels with 97770 rooms on the approved list of the Ministry of Tourism. The break up of these hotels by different star categories is given below:

Star Category No. of Hotels No. of Rooms 5- Star Deluxe 78 17885

5- Star 89 10982 4- Star 126 8831 3- Star 634 28783 2- Star 560 18449 1- Star 207 6765

Heritage 79 2173 To be classified 119 3902

Total 1892 97770 Source: Annual Report DOT 2004-05 The Key Characteristics of each category of hotels and typical locations is given below. Category Typical Location Target Customers Five Star Deluxe & Five Star

Restricted to the four metros and Major cities like Bangalore and Hyderabad

Foreign business and leisure travellers, senior business executives and top government officials.

Three Star & Four Located in all major cities as well as tourist destinations

Middle level business executives and leisure travelers

One Star & Two Located in major cities and small cities and tourist destinations

Domestic tourists

Heritage Heritage hotels comprise old palaces, havelis, castles, forts and residences, converted into hotels largely located in leisure tourist destinations like Jaipur, Mysore.

Primarily foreign leisure travellers.

Source: WTTC :The 2005 Travel & Tourism Economic Research Trend in occupancy Increase in income levels, emergence of a dynamic middle income class and improved infrastructure in terms of domestic air and rail connectivity have led to growth in domestic leisure travel. Simultaneously, domestic business traffic has also grown with general improved corporate profitability and positive business environment in India. The trend in occupancy for hotels in the period FY2000 to FY2004 is plotted in the chart given ahead:

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During FY2003, the average occupancy stood at 54.8%, marginally higher than 53.2% recorded in FY2002. FY2004 saw marked improvement in occupancy with average occupancy rising to 59.7%. The increase in occupancies can be attributed to increase in foreign tourist arrivals and the pickup in the performance of the Indian corporate sector. (Source: ICRA : February 2005) Tourists inflow in India during 2005 The year 2005 has been a highly successful year so far as tourism in India is concerned. For the third successive year, India witnessed a positive growth in foreign tourist arrivals, reaching a level of 3.91million against 3.37 million during last year. Another important highlight of the India tourism during 2005 was an increase of 20.20% witnessed in the foreign exchange earnings in dollar terms. The estimated foreign exchange earnings during the year touched the level of US $ 5730.86 million during 2005 against US $ 4769 million during 2004- a growth of about US $ 960 million in one year (Source-: Business standard 10/01/06). In absolute rupee terms, the increase in foreign exchange earnings during the year was to the tune of Rs. 3570 crores. It was observed that on an average per tourist foreign exchange earnings in India was about US $ 1462 against the estimated world average of US $ 850. Even when the average earnings per tourists are compared with those of the top world tourist generating countries or with countries in India’s neighborhood, it was highest in India with an exception of USA, as can be seen from the table below: Country Average per tourist estimated foreign exchange earnings (US $) France 555 Spain 792 USA 1698 Italy 993 China 640 (Source: DOT Annual Report 2004-05) The high spent in India can be mainly attributed to more number of days spent by a foreign tourist in India compared to other countries besides the visit of high end tourists to India.

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Estimates by World Travel and Tourism Council (WTTC): The WTTC has made the following estimates for India in its ‘ The 2006 Travel & Economic Research’ on India.

• India's T&T Industry is expected to contribute 2.1% to Gross Domestic Product (GDP) in 2006 (INR713.8 bn or US$16.13 bn), rising in nominal terms to INR1,881.9 bn or US$29.6 bn (1.7% of total) by 2016.

• India’s Personal Travel & Tourism is estimated at INR935.4 bn, US$21.4 bn or 3.8% of total personal

consumption in year 2006. By 2016, this should reach INR2857.1 bn, US$45.0 bn or 4.0% of total consumption. India business travel is estimated at INR260.80 bn, US$6 bn in year 2006. By 2016, this should reach INR822.1 bn or US$12.9 bn.

• Government Travel & Tourism operating expenditures in India in 2006 are expected to total INR41.2 bn

(US$0.9 bn) or 1% of total government spending. In 2016, this spending is forecast to total INR119 bn (US$1.9 bn), or 1.0% of total government spending.

• India Travel & Tourism Capital Investment is estimated at INR681.5 bn, US$15.6 bn or 7.2% of total

investment in year 2006. By 2016, this should reach INR2,314.2 bn, US$36.5 bn or 7.5% of total.

• In India, Exports make up a very important share of Travel &Tourism's contribution to GDP. Of total India exports, Travel &Tourism is expected to generate 4.7% (INR423.7 bn or US$9.7 bn) in 2006, increasing to INR2015.8 bn, or US$31.8 bn (2.6% of total), in 2016.

Promotional activities by Central & State Government and Department of Tourism The government of India has initiated various policy changes in the recent past to boast tourism growth. Which include increased budgetary allocation for tourism at Rs. 830 crores (2006-07) against Rs. 786 crores in the year 2005-06 and Rs. 541 crores in the year 2004-05, removal and reductions in taxes on Travel & Tourism, flexible policy on charters, introduction of open skies for peek tourism season, privatization of Delhi & Mumbai Airports, Divestment in Government Hotels, enhanced participation between public & private sectors. which have helped in providing the required impetus to the growth in Tourism. Some of the other promotional activities undertaken by the government are: (a) Direct approach to the consumers through electronic and print media through the “Incredible India” campaign. (b) Centralised Electronic Media Campaign. (Athiti Dev Bhav) (c) Participation in Trade Fair & Exhibitions (d) Generating tourists Publications (e) Focusing on Growth of Hotel Infrastructure, particularly Budget Hotels. (f) Enhancing connectivity through augmentation of air capacity and improving road infrastructure to major tourist

attractions. (Source: Ministry of Tourism & Culture, Department of Tourism, WTTC: The 2005 Travel & Tourism Economic Research and DOT Annual Report 2004-05 ‘Incredible India’, a multi-pronged promotional campaign launched by the Department of Tourism, India, aims to position India as an up market destination for discerning travelers. It focuses on the diversity of India as a holiday destination ‘with something for everyone’, from beaches to mountains, world heritage sites to cultural fairs and safaris to holistic holidays. The Department of Tourism’s initiatives to provide visitors to ‘Incredible India’ with a world-class experience are bound to continue a gradual increase in India’s market share of global tourism. No wonder the Conde Nest Traveler, a leading International Travel publication has rated India as one of the top ten favorite tourism destinations.

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Gaining importance of E- Tourism Travel industry and the Internet make a prosperous pair. Online sales of airline tickets, car rentals and hotel reservations make the travel industry one of the strongest e-commerce markets in existence today. The airline industry represents the largest segment of the e-travel industry. In the year 2000 alone, the US online air tickets sale soared above $ 7 billion. US online hotel and motel sales were well above $ 2 billion. The biggest factor stimulating online travel sales is the Web Sites designed to meet consumer needs. Further, there is synergy among online travel industry components like Car rental, airline, tour packages and hotel online reservations which will feed off each other. According to the UNCTAD “Information Economy Report 2005”, in developed markets such as the US, around 90% of tourism sales are made online through airlines and travel agencies. UNCTAD points to an interesting fact that since most information on tourism opportunities in India for foreign inbound tourists is generated, updated and marketed online by major international service providers based in developed countries, these providers end up absorbing as much as 40% of the total profits in the tourism industry. (Source: Hotelmarketing.com) Internet Users worldwide have grown 44.5 Million in 1995 to 665 Million in 2002 and are projected to grow to 1350 Million by 2007.

Growth in Use of Internet Worldwide

44.5184

284413

544665

814934

10701210

1350

0200400600800

1000120014001600

1995 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007Years

Use

rs in

Mill

ions

Source: Computer Industry Almanac (as quoted by Click Stats in September 2004) / e Forecasts for earlier figures Asia, Europe and North America have shown the highest number of internet users comprising 88% of the total internet users as on March 2005.

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Worldwide Internet Users by Region- March 2005 (in Million)13.5

16.3

19.4

56.2

221.4

259.7

302.3

Africa

Oceania/Australia

Middle East

LatinAmerica/CaribbeenNorth America

Europe

Asia

(Source: Internet World Stats statistics updated on 24th March 2005) The latest US Online Travel Trend shows an increase from 15% in 2002 to 27% in 2004 and is expected to rise to 35% in 2006. Year 2002 2003 2004 2005 2006 % of US Travel booked Online 15% 21% 27% 32% 35% Sources: PhoCusWright data from June 2004 (Quoted by eMarketer in March 2005) In UK, a survey conducted by Amadeus of 2,000 UK holidaymakers conducted in May 2005 and reported by travelmole shows Almost 51% of the last minute deals happening through Online Travel Agencies.

Sources used to search last minute Travel Deals - UK

22%

29%

32%

34%

51%

0% 10% 20% 30% 40% 50% 60%

Tourism websites

Local high street travel agent

Personal recommendations from friends & family

Traditional paper holiday brochures

Online travel agencies

Mod

e U

sed

%

Source: Survey by Amadeus of 2,000 UK holidaymakers conducted in May 2005 (reported by travelmole).

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Purchase of travel services on a global basis is migrating aggressively to Internet. In 2005, online travel in USA is expected to generate approximately US$ 100 billion of gross revenues, thereby accounting for early 50% of total industry revenues. E-tourism is fast gaining foothold in the Indian market with now close to 25% of the travel business being conducted through the internet. The figure may not compare with the US market, where 90% of travel businesses are done through the Net, but industry analysts feel e-tourism may contribute 50-60% of the travel business in India in the next five years. (Source: Hotelmarketing.com) The Indian aviation industry has also stepped in a big way to sell online domestic and international air tickets. Deccan Air, Spice jet, Kingfisher and Jet Airways are some of the names of domestic airliners who started selling airline tickets through websites. The Indian banking industry has also gearing up to the online & everywhere hassle free banking. Almost every bank in India has opened ATMs f or hassle-free cash transactions and are in process of upgrading their technology to serve huge number of customer who wants to avail online banking facilities. Online payments facility are also being increasingly used by the Indian consumers. Now, 50% of travel arrangements in the World are transacted on the Net and it is believed that about 17% of holiday business is also transacted on Net. The success of Expedia.com and Travelvelocity.com are good examples. In India, now with Indian Railways going online, an Individual can buy tickets online and pay through credit cards. While a majority of online travel sales is e-ticketing, other services such as online booking of hotel rooms are also gathering steam. Today, travel portals provide an opportunity for tourists to plan their entire trip, including air tickets and hotel bookings. Internet has emerged as an important tool for them to distribute and market various package deals. Leading travel and tour operators such as Thomas Cook and Stic Travels provide a wide gamut of online services. Right from travel information and flight schedules, hotel room availability to booking tickets, rooms, car rentals and even purchasing travel insurance products as well as foreign exchange can now be done online. There are many other travel sites, however, that act as only information windows of the services and package deals offered by the travel agency, instead of providing real-time reservation services. Internet savvy Indians (presently more than 40 million and expected to multiply to 100 million by 2008) comprise an ideal target market to push online sales for outbound and Domestic travel. Indian travellers also rank among the foremost tourism spenders in destinations like Australia, Singapore, Dubai, Switzerland, North America and Europe.

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BUSINESS OVERVIEW OVERVIEW Our company is promoted by a team of professionals viz. Mr. Sunirmol Ghosh, Mr. Sudesh Behal and Mr. Gajendra Singh Panwar, who are having a varied experience in the business of Travel Services. Our Company started operations in May 2, 1988 by offering holiday package tours to the foreign tourists visiting India. Over a period of 18 years, we have expanded our operations to Outbound Tourism, Domestic Tourism, Hotels and ticketing. We are recognized by the Ministry of Tourism, Government of India. We have received many awards and Certificates of Merit since 1992 for promoting tourism in India. This includes ‘Third Position under the First Category’, National Tourism Award for Excellence in Tourism, Given by Department of Tourism, Govt. of India for the year 2001-02 for being the third highest foreign exchange earner in our category. We have earned more than INR1670 Million worth of foreign exchange since inception. We are active members of various Indian and overseas Tourism organization, prominent among them being ASTA, PATA, USTOA, India Association of Tour Operators etc. We have our registered office in Delhi and branch offices in Chennai, Bangalore, Kolkata and Goa. Apart from this we are having about 35 local handling agents in India and about 5 local handling agents in other countries in the India Sub-Continent like Sri Lanka, Bhutan, Myanmar, Nepal and Bangladesh, for executing our business. Over the years, we have established good business relationship with some world renowned tour operators like GeBeCo - Germany, Djoser – Holland, Insight Reisen – Switzerland and Joe Far Reisen – Austria. We own a 3 Star Hotel property in Bikaner (Rajasthan). The Hotel became operational in June, 2000. We also own a fleet of 19 modern deluxe tourist transport coaches and 3 SUVs. The average age of these coaches is 30 months. The Hotel property and transport coaches facilitate the operations of our core business of tour operators. We offer a complete Holiday and Leisure solutions. We have divided our business into two divisions for operational convenience and better management. The Inbound Tour Services are undertaken under our division ‘Indo Asia Tours’, while Outbound and domestic tour services, along with ticketing services is undertaken under our division ‘Indo Asia Holidays’. Currently we are handling about 10000 clients from various countries on an annualised basis. We service to clients from over 26 countries across the globe which include Germany, Holland, Austria, Sweden, Finland, Denmark, Brazil, USA, Spain and East European countries. Our clientele include both business as well as leisure travelers. Our strength lies in providing tailor made timely and quality tour package options to the visiting tourists at an affordable price. We also organize Festive Tours, Wildlife Safaris, Camel Safaris, Ayurveda Tours etc. to promote the culture of our country.

OUR ACTIVITIES We currently provide the following services: A. Travel & Tours Services (both Package Tours and tailor made Tours)

- Inbound : Foreign Visitors coming to India - Outbound: Indian visitors going abroad - Domestic: Indian Visitors traveling within in India

B. Hotels

- 3 Star Hotel Property at Bikaner, Rajasthan C. Ticketing Service

- Agent/ Stock holder for Jet Airways - Registered Ticketing Agent for all private airlines in India - Facilitate booking of International Air tickets through other agents.

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A. TRAVEL AND TOUR SERVICES Package Tours to Inbound Tourists Inbound Tourist refers to foreign tourists/ business travellers/ leisure travellers/Other travellers coming to India. Inbound tourism contributes to the majority of the revenues of our Company. During the financial year 2004-2005, more than 90% of our Company’s revenue originated from Inbound tourists. With increasing revenue from the Outbound and domestic tourism, it is currently at about 70% of our revenue. Our Company’s inbound tourists originate from about 26 countries. Presently, majority of our customers originate either from Germany or from German-speaking countries. Around 60% of the inbound travel business originates from packaged tours, with a la carte options comprising the rest. Our principal tour operator in the respective foreign country charges the end customer a tour package cost which includes, the cost of international and domestic travel, boarding and lodging, multilingual guide services and other incidentals as negotiated by him with the end customer. We charge our principal tour operator for the services (domestic travel, accommodation, guide, sight seeing etc.) rendered by us from the date of the arrival of the foreign tourists in India to the date of their departure, along with a mark-up on the total cost of services offered. In our industry, it is customary to quote prices (both for Season and Off season separately) of package tours, for a year in advance to our principal tour operators abroad. The key inbound packages offered by our Company are shown below. These packages are available to both groups and free individual tourists (“FITs”). The cost per person varies according to the size of the group, the larger the group, the more economical the rate per person. Package Main Destination No. of Days Golden Triangle Delhi - Agra – Jaipur 7 Rajasthan Delhi, Jaipur, Mandawa, Bikaner, Khimsar, Jaisalmer, Jodhpur,

Udaipur 21

South India Mumbai, Bangalore, Mysore, Coorg, Calicut, Kochi, Madurai,

Tanjore, Chennai, Pondicherry 21

North India & Nepal Ranthambore, Jaipur, Agra, Khajuraho, Varanasi, Kathmandu 15

Himalayan Kingdoms Delhi, Darjeeling, Gangtok, Pemayangtse, Thimpu, Punakha, Paro,

Kathmandu 18

Impression of India Mumbai, Udaipur, Jodhpur, Jaipur, Agra, Khajuraho, Varanasi, Delhi 15

Wildlife Programme

Delhi, Ranthambore, Jaipur, Bharatpur, Agra, Khajuraho, Bhandavgarh, Kanha, Mumbai

16

Wellness Tour Mumbai, Kochi Ayurveda Resort, Kochi Rice Boat, Mumbai 14

Our inbound tour operator process starts with the marketing of our products in the International markets. We take part in various Tour Fairs organized in various countries and market our products to foreign tour operators. We then enter into contracts with various service providers for accommodation, transport and sightseeing etc at various tourist locations in India. After that we draw out the tour programs and tariffs and send it to our business associates (foreign tour operators) abroad. Finally, on confirmation of the bookings from the business associates abroad, we execute the tour package as per the agreed terms and plans. We are a Agent/ Stock holder for Jet Airways and uses the services of other Agents to make reservations on other airlines. The Hotel reservations and other arrangements are carried out through direct negotiations with various hotels located at the tourist destinations and the rates are fixed in advance ahead of the season. We use our fleet of 19 tourist coaches and 3 SUVs located at various locations for transporting tourists to various local destinations. In

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places where we do not have our own tourist coaches, we have tie ups with local transport agencies for providing transport services. Our inbound customers are primarily high-spending tourists who prefer 4-5 star facilities, with the notable exception of tourists from Holland, who are budget travellers and prefer 2-3 star facilities. The revenue generation from our Inbound tourism during the last 3 years has been as given below:-

Year No. of tourists Revenue (Rs. in Lacs) 2003 3,256 1001.58 2004 6,491 2011.80 2005 9,154 3112.19 2006 9,340 3560.12

Over the last two years, the percentage growth in inbound tourists handled by our Company has been higher the percentage growth in arrival of inbound tourists into India. We have witnessed an inbound business growth of 54% in FY2005 and more than 100% in FY2004. Outbound Tourism The Outbound tourism refers to Indian Nationals (Tourists, Business Travellers, Students, Leisure travelers) going out of India. We have started the Outbound Tour Services in our Company from January 2005 onwards. However, earlier we have been carrying out similar services in one of our group company viz. Indo Asia International Limited since 2000. Our Company sources outbound tour packages through various tie ups/ association with established Tour Operators in various Countries. The tour packages provided by these operators however include only accommodation, food, sightseeing and travel outside India. The travel to and from India is arranged by our Company through negotiation with various Indian and foreign Airlines. Further, we undertake additional services like Visa, foreign exchange and travel insurance. The complete package of Travel, accommodation, food and sightseeing is then marketed by our Company to resellers and direct customers. We have a network of about 41 local handling agents in the Indian sub-continent, including one each in Nepal, Bhutan and Sri Lanka to cater to the business of our Company. Indo Asia’s outbound holidays are primarily targeted at medium-spending tourists who are accommodated in 3-4 star hotels. We specialize in providing the following Outbound Tour Packages: Package Main Destinations in the Tour Package No. of Days Australia/New Zealand

Sydney, Gold Coast, Cains, Auckland, Rotorua, Christ Church 11

Tanzania Kilimanjaro, Arusha National Park, Tarangire National Park, Serengeti National Park

11

South Africa Johaneshburg, Kruger National Park, Sun City, Cape Town 9 North America Lima, Cuzco, Machupicchu, La Paz, Buenos Aires 16 Egypt Cairo, Aswan, Luxor, Alexandria 8 China Beijing, Shanghai, Xian, Canton 8 In addition to the above packages, we also provide Outbound Tour Packages to countries in Europe, South East Asia, Middle East and Indian Sub-continent. Further, now we have started providing online tailor made outbound packages for Corporates and other leisure travelers.

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The revenue generation from our outbound tourism division during the last 3 years has been as given below:- Year No. of tourists Revenue (Rs.lacs) 2003 - - 2004 - - 2005 139 20.70 2006 686 192.96 We have witnessed a growth over 400% in the number of outbound Indian tourists handled during 2006 over 2005. We intend to expand our outbound tour operations to gain sizeable business from this segment. Domestic Tourism The domestic tourism refers to Indian Nationals (Tourists, Business Travellers, Students, Leisure travelers) travelling within India. We started Domestic Tour Services in our Company from January 2005 onwards. However, earlier we have been carrying out similar services in one of our group company viz. Indo Asia International Limited since 2000. Our Company offers both tailor made and fixed tour packages to our clients. We get inquiries for domestic tour packages both from our branch offices, local agents and also directly from customers. The domestic tour package offered include Travel, accommodation, food, sightseeing and guide services. We offer mainly the following Domestic Tour Packages: Package Main Destinations in the Tour Package No. of Days Rajasthan Agra, Jaipur, jodhpur, Jaisalmer, Mount Abu, Udaipur 12 Kerela Cochin, Munnar, Periyar, Kumarakom, Kovalam 10 Karnataka & Tamilnadu Bangalore, Mysore, Ooty, Kodaikanal 8 Darjeeling & Sikkim Darjeeling, Gangtok, Pemyangtse 7 Kashmir Srinagar, Pahalgaon, Gulmarg 8 Char Dham Haridwar, Barkot, Harsil,Guptkashi, Kedarnath, Joshimat,

Badrinath 11

Goa Goa 4 Hill Package Shimla, Mussorie, Dalhosi 2 – 4 Himachal Chandigarh, Dalhoisie, Dharmsala, Manali, Shimla 11 Uttranchal Agra, Nainital, Corbet, Haridwar, Mussorie 11 We use our expertise and experience to offer tailor made packages to individuals and groups considering their requirement, comfort and budget. The revenue generation from our domestic tourism division during the last 3 years has been as given below:-

Year No. of tourists Revenue (Rs. in Lacs) 2003 - - 2004 - - 2005 771 for 3 months 78.81 Till Feb 2006 3599 372.64

The number of domestic travel handled by us has grown from 771 for January to March, 2005 to 3599 for the 11 month period ending February 28, 2006. We intend to expand our domestic tour operations further to gain sizeable business from this segment.

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B. HOTELS Hotel ‘Heritage Resort’ at Bikaner, Rajasthan (3 –Star Classified) Location: 9KM Milestone, Jaipur Highway, Bikaner, Rajasthan – 334 001 Our Company currently owns one 3 Star classified Hotel at Bikaner (Rajasthan). Hotel ‘Heritage Resort’ located on the Bikaner- Jaipur highway, exudes the regal splendor of a bygone era. The Hotel is located at about 11 KM from the Bikaner Railway Station and the nearest Airport is Jodhpur which is located at a distance of about 250 KM. The Hotel commenced its business operations in June, 2000. It is constructed on land owned by Heritage Inn Resort (Bikaner) Pvt. Limited, from which our company has taken the land on long term lease from 15.07.1998 for a period of 30 years. It is currently equipped with 18 Cottages (with 2 air conditioned double rooms in each cottage), a swimming pool, a restaurant offering Indian, Rajasthani and Continental cuisines, a well stocked bar, banqueting facility for 400 people, EPABX facility and Kerela Ayurvedic Massagge Centre. It also has a putting green (mini golf course). Further, as a strategy to provide additional value added services to its clients, the hotel also makes arrangement for conducting Camel Safari and Desert Camps for the tourists/travelers arriving in the Hotel. The Hotel has 43 employees who are permanently on the payroll of the Company. The Hotel caters mainly to foreign Inbound Tourists who opt for our tour packages. However, subject to availability it also caters to the requirements of other tour operators and domestic and other foreign tourists on individual basis. The average occupancy of the Hotel during the last 5 years has been as follows:

Financial Year ending March 31,

Total Rooms Available

Room Sold Average Room Rent

2002 13140 3154 1311 2003 13140 2441 1530 2004 13140 3870 2005 13140 5754 1708 2006 13140 5649 1866

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C. TICKETING We have a ticketing division which provides support to our Inbound, Outbound and domestic tour operation business. It also makes Air Ticket bookings for other individual clients. We are an agent/stock holder for Jet Airways and use the services of other agents to make reservations on other airlines for both domestic and overseas bookings. We use the Computer Reservation System (CRS) booking engine provided by Amadeus, Galileo and Abacus. In addition to regular ticket booking services, we have also tied up with various agencies and provide other incidental services like VISA arrangement, Forex Services, Insurance etc. We are providing services to Corporate clients like Network 21, Habibs, Max New York Life and Director General of Border Roads. We are in the process of applying for IATA registration. The revenue generation from our ticketing division during the last 3 years has been as given below:-

Year Revenue (Rs.in Lacs) 2003 - 2004 - 2005 51.20 2006 525.80

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TRANSPORT FACILITIES We own a fleet of 19 modern and comfortable tourist transport coaches and 3 SUVs for catering to our Inbound and Domestic Tourists. This include 35 Seater air conditioned coaches, 18-21 Seater Mini Coaches, 9-11 Seater Tempo traveller and Toyota Qualis. Our transport coaches are well maintained and serviced regularly. The average age of our Transport Coaches is about 30 months. In our endeavor to be the best, we have been regularly modernizing our transport fleet. Clients’ comfort and safety are of paramount concern to us. Our new coaches meet the European Emission Norms. Every vehicle has a full comprehensive insurance. Our long experienced drivers are patient and understand the psychology of the tourists very well.

FUTURE BUSINESS STRATEGY Our Company aims to transform into a ‘One Stop Travel Solution Provider’ with strong Brand image and high customer satisfaction. We intend to achieve our aim through business expansion which would involve setting up of Online Travel Portal and Travel Support Station, Establishment of Holiday and Travel Solution Stations, in various cities in India and Sales and marketing offices in USA and UK, setting up of new Hotels/ taking over of existing hotels on lease, Purchase of new transport coaches and Corporate Brand Building and Advertisement. We intend to develop a Operational Headquarter and Corporate Office at Gurgaon to co-ordinate the activities of our company. 1. Online Travel Portal and Travel Support Station Online Travel Portal Our Company proposes to establish an Online Travel Portal by the name www.indiahollidaymall.com, as a natural extension of our existing business operations. The Portal would be a “One Stop Travel Solution” for domestic and international travelers and would allow domestic/ international travelers to customize his holiday/business trip, which would include air ticketing, hotel reservation, Transport etc. at good value for money and with a secure and safe online payment mechanism. The USP of the Portal would be “make my dream holiday”. We propose to start with a Online Ticketing Module where prospective clients viz. customers, domestic travel agents and foreign travel agents can log in and make online bookings to any destinations in India and abroad. Once the ticketing module is established we propose to extend the services of the portal to provide for Online bookings of Hotels and local transport, sightseeing etc. Thus the integrated travel portal would provide facility to the user to plan his own trip according to his own budget and preference. The portal would provide additional features like Last Minute Hotel deals, Last Minute Transport deals, Search for travel companion etc. to economise the tour cost of the travelers. The Portal would serve the requirements of a variety of potential clients (“visitors”) visiting the site. It would provide the following modules: (i) Weekend Gateways: This would have the option to search from 7 Asian countries viz. India, Nepal, Bhutan,

Tibet, Bangladesh, Pakistan and Sri Lanka and would provide option to visitors to search for places, hotel, special offers, weekend destinations, culture etc.

(ii) Tour of the Month: These tours would be fixed date departure tours on scat basis and would have only 2

prices per person on twin sharing and single supplement. Complete details of the tours with dates, hotel stay, destinations and places of visits etc. would be available on the website.

(iii) Dream Holiday: If the client does not know about India, then this link will take him to the tailor-made

itineraries and if he knows exactly which cities he wants to visit, then he can customize his own tour. After the selection of cities and services, client will instantly get the price and invoice of the tour.

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(iv) Holiday Bank: In our endeavor to make the clients’ holiday worriless and trouble-free, we would offer this unique feature to every client who has booked any other travel related service with us. This service will be offered in collaboration with a bank. We will facilitate delivery of clients’ money at any place wherever required. The money would just a phone call away and no hassles to the client for going to the bank and money would be delivered in local currency. Complete details for availing this facility would be provided on the website.

(iv) Domestic/International Tickets: The client would be able to book any flights’ air ticket for any of the

destinations as per his choice through the secured and safe facility intended to be provided on the website. (v) Travel Insurance: The prospective customer/client would have the option of availing travel insurance from the

Company of his choice. This facility will be provided in collaboration with leading insurance companies. (vi) Booking of Hotel Rooms: The prospective customer/client would be able to book online hotel reservation

through the website for cities in India and abroad. In some of the cities due to large supply of rooms, it will also be possible for the client to bid for a price. If the customer is flexible about the location and travel dates, we would assist him in getting the hotel reservation at the best price.

(vii) Search for a Travel Companion: In our sincere effort the best value for money we intend to provide this very

unique feature on our website. If any client is a single person in finds it expensive to travel alone or to pay for single room, the site would offer possibility to get a companion and share the cost on plain business proposition to make the holiday a good value for money.

(viii) Login Area – Client/ Transport Agent/Hoteliers/Channel partners : There will be a common login box for

client, business partner, transport agent and hotelier. The computer will automatically identify the respective category. With the help of login details hoteliers and transport agent can put their rates and last minute offers. Partner with us can check the rates of hotels, transport, packages. They can also check the status of their bookings generated through this portal.

(ix) Last Minute Offer: This link will go to the bid of the Hotel room and go to the auction module. Hotelier will

put their last minute offers in this section. (x) Order Your Book: Order your book will be separate link to a Books selling website. These would be provide

generally travel related books. (xi) Holiday Souvenir: This module allows the souvenirs to put their products for online shopping through our

portal. (xii) Channel Partners and Service Providers: The portal will be open to complete travel industry for registration

with our website. However the acceptance of a service provider by us would depend on laid down standards and in most cases it would be online. The most important criteria for accepting a service / product provider would be to ensure quality and laid down minimum standard for the consumer. The service provider would be asked to sign the quality control assurance undertaking and this would be clearly specified on the website. The service providers would include Tour Operators, Hotel/resorts/camp operators, Airlines, Travel Agents, Specialty Restaurants, Equipment Providers, Adventure Sports Facility Provider, Wellness Resorts like Ayurveda/Yoga Resorts, Boat, Ship and Cruise-lines, etc., Entertainment Event Organisers, Handicraft Manufacturers and Sellers, and Conferences Organisers.

(xiii) Any other service/product provider subject to our acceptance. Our Online Travel Portal would provide a boast to our Tour Operation business and Hotel business. Currently, there are over 100,000 hotel rooms in India; a majority of them are not networked with any GDS (Global Distribution System) or any online booking tool. Indiaholidaymall.com intends to radically change the ‘supply side’ of the

58

equation at the hotel level by bringing hotels online (using a hybrid approach of connectivity and merchant model) and simultaneously revolutionizing the way leisure travel is bought, thereby changing the ‘demand side’ by offering real-time booking ability at reasonable prices to customers. The same can be repeated for other service providers like a transport supplier or even an airline. Business enquiries, which would be generated through online portal will be followed by personal/ telephonic conversation and or meetings to convert the enquiry into business for different segment. As our Company has been in the business of providing Travel Services for more than 18 years, the online travel portal would act as natural extension of our business and help in increasing our scale of operations and revenue. Travel Support Station Further, we also propose to establish a Travel Support Station at Gurgaon (Haryana), which would cater to the variety of customer queries and needs on 24 X 7 basis. The Travel Support station would be equipped with Toll Free telephone lines (512 Kbps IPCL line) from four countries viz. US, Canada, UK and India. It would be having 36 CSU terminals with the Central Reservation System (CRS) software, a Chat software, a Customer Relationship Management (CRM) Software, and Enterprise Resource Planning (ERP) Software. The Travel Support Station would help us in providing value added service/ assistance to our customers/business associates on a 24 hr. basis. Our Company proposes to develop an intricate and specialized human resources recruiting, training and monitoring process for Support Station staff. We also intend to gradually use the infrastructure to provide services to various airlines, hotels and other tour operators for generating additional business revenue. The launch of our Online Travel portal ‘www.indiaholidaymall.com’ & Travel Support Station would give thrust to the existing Inbound, Outbound and domestic tourism business by way of increased customer access and service, better international recognition and direct deals with airlines. 2. Establishment of Overseas Sales & Marketing Offices In order to avail and exploit the business opportunity that exists from Inbound and Outbound tourists, our Company proposes to establish two overseas Sales and Marketing offices, one each at London (U.K) and at New Jersey (USA) to expand business operations to and from these two destinations. In the past, these two countries have constituted for a major portion of revenue from foreign tourists in India. The establishment of sales and Marketing offices in these countries would be used to develop business relationship with local tour operators and travel industry fraternity within these countries. It would help us in reducing the cost of intermediaries and help in brand building of our company in these markets. This would help us in gaining business from Inbound Tourists in India originating from these countries and also Outbound Indian Tourists traveling to these destinations. 3. Establishment of Holliday and Travel Solution Stations (HTSS) In India Our company proposes to establish Holliday and Travel Solution Stations across India to avail the huge business opportunity that exists in the Tourism Sector. We propose to establish these Stations initially at 10 locations, namely, Mumbai, Goa, Ahmedabad, Hyderabad, Indore, Jaipur, Amritsar, Lucknow, Ranchi and Kolkata. The HTSS will be managed by experienced travel industry professionals, to be employed by our Company, who would market our company’s packaged tours to domestic and outbound Indian travellers. The Travel Support Stations will help in setting up a network of sub-agents in their respective regions. This would help us in increasing our business operations through customized service to our clients. The outbound tourism in India has been witnessing significant growth on account of rising income levels. Further, many Indian companies are holding their Trade / Business conferences outside India and large number of Software professionals from IT sector companies are going abroad every year for on-site software development. We expect to

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target these prospective clients through these domestic HTSS to provide tailor made and Fixed Departure tour packages. Further, these HTSS would also market Domestic Tour packages to Indian residents. Our Company would benefit from the knowledge and experience gained over the past few decades to offer quality services to the domestic clients to have a great holiday along with their children and family, just about anywhere in India. We would offer tailor-made package tours for the individuals, group tours with fixed departures to explore different areas of the country and countries in the Indian Sub continent. These HTSS spread across the country will have a standard design, interiors and outside signage public board. All the HTSS are proposed to be inter- linked through latest networking technology providing Real Time Online Holiday and Travel Solution, including a secured payment gateway. We propose to make a well-planned Brand promotion and Advertisement campaign at the time of launching of these domestic Travel Solution Stations. This would not only help our Company in securing the Tour & Travel business, but also in creating our brand awareness across the country. 4. Establishment of Tourist Hotels/ Taking over of existing hotels/Resorts on long term lease Our Company proposes to construct a 3-Star 60 Room Hotel, on Build – Operate - Transfer (BOT) basis at Jaipur (Rajasthan) and a 3-Star 30 room Hotel on Build- Operate- Transfer (BOT) basis at Humpi (Karnataka). We propose to take about 1,59,300 Sq. ft of land on lease in Jaipur and 1,74,240 Sq. ft of land at Humpi for the aforesaid purpose. In this regard, we have already entered into MOUs dated February 18, 2006 and February 9, 2006 respectively with the owners of the land for taking the above referred land on long term lease. The hotels proposed to be constructed at Jaipur & Humpi would be having all the amenities of a 3 Star category hotel. In addition, our Company has identified existing hotels each at Jodhpur, Udaipur and Coorg (Karnataka) for taking the same on long-term lease of minimum 10 years. These Hotels are: (i) Hotel ‘Paras Mahal’ - Udaipur The Hotel is located near Paras Talkies, Sector 11, Hiran Magri, Udaipur and has all the amenities of a 3 Star Hotel. It has 60 well furnished air conditioned rooms, with a multi cuisine restaurant, a coffee shop, a well stocked bar, conference/banquet hall and EPABX facility. The hotel also has a swimming pool and a shopping arcade. We have entered into a MOU dated May 1, 2006 with the owners of Hotel Paras Mahal, for taking on lease the Hotel property for a period of 30 years from the date of execution of agreement with them. In terms of the MOU, We have the right to manage the hotel and operate it commercially during the lease period. In consideration for the lease, our company is required to pay the owner, a lease rental of 15% of the gross turnover for the first 5 years during the lease period. The rental would be increased to 20% of the Gross Turnover from the 6th year. Further, we are required to pay 50% of the average of the Gross Turnover projected for the next 3 years as interest free deposit to the owner. (ii) Hotel ‘Utsav’- Jodhpur The Hotel is located at Rai Bahadur Bazaar, Jodhpur and is a budget Hotel. It has 42 well furnished rooms. We have entered into a MOU dated May 1, 2006 with the owners of Hotel Utsav, for taking on lease the Hotel property for a period of 10 years from the date of execution of agreement with them. In terms of the MOU, We have the right to manage the hotel and operate it commercially during the lease period. In consideration for the lease, our company is required to pay the owner, a lease rental of 20% of the Net Annualised turnover during the lease period. Further, we are required to pay 50% of the average of the Gross Turnover projected for the next 3 years as interest free deposit to the owner.

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(iii) Hotel ‘Coorg Resort’ - Coorg The Resort is currently in construction stage and is expected to be completed by end of June 2006. The owner of this Hotel is a Partnership firm, ‘Hotel Hatty’ of which our promoters Mr. Sunirmol Ghosh and Mr. Sudesh Behal are the partners. The Resort is being constructed on plot of land bearing the Sy. No. 50/3, measuring 6 acres at Monnageri Village, Medikeri Taluk, Kodagu District, Karnataka state. The Resort when completed would consist of 36 cottages, a Restaurant, swimming pool and other amenities available in 3 star resort. We have entered into a MOU dated May 8, 2006, with Hotel Hatty, for taking on lease the proposed Resort property for a period of 10 years from the date of execution of agreement with them. In terms of the MOU, We have the right to manage the hotel and operate it commercially during the lease period. In consideration for the lease, our company is required to pay the owner, a lease rental of 20% of the Net Annualised turnover during the lease period. Further, we are required to pay 50% of the average of the Gross Turnover projected for the next 3 years as interest free deposit to the owner. 5. Acquisition of Additional Tourist Transport Coaches We currently have a fleet of 19 Nos. modern Tourist Buses and 3 SUVs for facilitating the operations of our Company. We further propose to acquire additional 5 modern Volvo Coaches, 3 Tempo Travellers and 5 Toyota Innova to support our increased business operations on expansion. 6. Set Up of Operational Headquarter and Corporate Office at Gurgaon, Haryana We propose to bring all our business divisions/process under one roof to help in centralized coordination and operation, by setting up a Corporate Office at Institutional Area, Sector 44, Gurgaon, Haryana, having about 40,000 Sq. ft. work space. We have already commenced construction of the office and the same has been financed through internal accruals. 7. Brand Building, Advertisement and Sales Promotion.

A brand implies high measure of familiarity – a reassuring impression of quality, strength, stability, reliability and overall trustworthiness. With the opening up of the Indian Economy and higher level of competition, customers are being left with several options to choose from. Thus Brand awareness becomes important so that Customers can choose the right brand to suit their needs. A well-known brand gives the customer a mental image of design, services and overall characteristics of a brand. Brand awareness and image is very important in hotel, hospitality and travel industry. Keeping this in view, and to give a thrust to its existing business operations as well as future expansion plans, our Company proposes to make a well-planned Brand Building, Advertisement and Sales Promotion Campaign during next couple of months using electronic & print media and display of sign boards at strategic locations throughout the country. We also propose to promote our services and brand through organizing customers’ meet, seminars & conferences and distributing our product literature and brochures. Similar advertisement and brand promotion exercise is proposed at the time of launching of our proposed Online Travel Portal – ‘Indiaholidaymall.com’ and at the time of launching of domestic and overseas (USA and UK) Sales and Marketing offices. Our Company proposes to engage services of a reputed & leading Advertisement & Brand Promotion agency for handling this campaign. This would provide the required impetus to our Company’s business operations within India and outside India.

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INFRASTRUCTURE FACILITIES Land Our Company owns approximately 2100 square metres of land at Institutional Area, Sector 44, Gurgaon, Haryana, which we propose to construct our Operational Headquarter and Corporate Office. We also own Agricultural Land measuring 24 Bigha and 9 Biswas in Bikaner (Rajasthan) which we use for conducting Camel & Desert Safaris. Human Resources Our employees are our biggest assets. We take full care in selecting our human resource. Our success in the business is largely due to our talented and skilled people. Our focus has been to employ the human resource with combination of technical expertise and innovative thinking for all areas and services to our organization. The brief details of our permanent employees as on March 31, 2006 are as given below - Particulars Corporate

Office Tour

Operation Ticketing Hotel E- Tourism Total no. of

employees Vice President - 1 - - - 1 General Manager 1 2 1 2 - 6 Manager 4 2 - 2 1 8 Asst. Manager - 8 - - - 8 Senior Executives - 9 1 1 1 12 Executives 2 39 4 21 3 69 Assistants 0 10 - 14 - 24 Trainees - 1 2 3 - 6 Total 7 72 8 43 5 135 *The above does not include our Wholetime directors who look after the overall operations of our company. ESOP/ESPS We do not have any Employee Stock Option Plan (ESOP) or Employee Stock Purchase Scheme (ESPS) as on date of filing of this Draft Red Herring Prospectus with SEBI. Payment or benefit to our employees Except statutory benefits upon termination of their employment in our Company or superannuation, no employee of our Company is entitled to any benefit upon termination of his employment. PROPERTY: Our Company currently owns 2 properties and has leased another 7 properties for the operations of our business. The details of these Properties is provided below: S. No. Property Name Location Remarks

Property Owned by our Company 1. 2100 Sq. Metres Land for

construction of Operational Headquarter and Corporate Office.

Plot No. 56, Sector 44, Gurgaon

Conveyance deed dated January 16, 2005 executed by Haryana Urban Development Authority in favour of our Company.

2. Agricultural Land measuring 24 Kasra No. 74 Sale deed dated May 07, 2003

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Bigha and 9 Biswas for Camel Safari.

Min Tadadi, Village Panpalsar, Tehsil Bikaner, District Bikaner, Rajasthan.

executed in favour of our Company.

Properties taken on Lease by Our Company 1. 1200 Sq. ft. area of space for use

as our Registered & Corporate Office

C-28, Housing Society, South Extension Part 1, New Delhi.- 110 049

Lease deed dated March 20, 2006 with Mr. Sunirmol Ghosh and Mr. Sudesh Behal, promoters. The lease is valid upto November 30, 2007.

2. Premises for use for office purpose.

First Floor, C-15 Housing Society, South extension Part – I, New Delhi – 110 049

Lease deed dated September 01, 2003 with Capt. Shivraj Mathur. The Lease is valid upto August 31, 2006.

3. 1200 Sq. Ft. area for use for office purpose

C-27 Housing Society, South Extension Part 1, New Delhi

Lease deed dated March 20, 2006 with Mrs. Meeta Ghosh, wife of Mr. Sunirmol Ghosh and Mrs. Priti Behal, wife of Mr. Sudesh Behal. The lease is valid upto January 31, 2008.

4. 1 Bigha and 4 Biswas. area of space for use as Garage for various vehicles used by our Company in our day – to – business activities.`

Khasra No. 42/1/2, Village Sultanpur Tehsil, Hauz Khas, New Delhi – 110 049

Lease deed dated December 29, 2005 with one of group company, Transasia Travelnet Pvt. Ltd. The lease is valid upto November 30, 2006.

5. 270 Square Ft. in the Ground floor for use as Branch Office purpose.

102, Skylark House, Wind Tunnel Road, Murgeshpalya, Bangalore – 560 017.

Lease deed dated December 26, 2005 with one of group company, Transasia Travelnet Pvt. Ltd. The lease is valid upto November 30, 2006.

7. 587.33 Sq.Ft. area for use for office purpose

35-L, Raman Street, T. Nagar, Chennai- 600 017

Lease deed dated May 6, 2006 with Mr. Sunirmol Ghosh, Mrs. Meeta Ghosh, wife of Mr. Sunirmol Ghosh, Mr. Sudesh Behal, Mrs. Priti Behal, wife of Mr. Sudesh Behal. The lease is valid upto March 31, 2007.

8. About 5130 Sq. Ft. area for use as Garage Space

Plot No. 180/3, Tehsil Krishnarajapuram, Hobli, Bangalore.

Lease deed dated December 29, 2005 with one of group company, Transasia Travelnet Pvt. Ltd. The lease is valid upto November 30, 2006.

9. Premises for use as branch office. Second Floor, 34/1C, Kavi Bharti Sarani, Kolkata- 700 029

Lease deed dated November 1, 2005 with Mr. Swapan Dhar. The lease is valid upto October 31, 2007.

10. Premises for use as branch office. City Business Centre, Coelho Pereira Building, Dr. Dada Vaidya Road, Panaji, Goa.

Lease deed dated February 1, 2006 with Coelho Pereira Investments Pvt. Ltd. The lease is valid upto December 31, 2006.

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INSURANCE We have undertaken a comprehensive insurance policy which covers Stocks, Plants and Machinery, Office Premises and Vehicles. This includes: (i) Office Insurance Policy from National Insurance Company for Office at C-28, Housing Society, South

extension Part- I, New Delhi valid upto June 23, 2006. (ii) Office Insurance Policy from National Insurance Company for Office at C-27, Housing Society, South

extension Part- I, New Delhi valid upto June 23, 2006. (iii) Office Insurance Policy from National Insurance Company for Office at C-15, Housing Society, South

extension Part- I, New Delhi valid upto July 8, 2006. (iv) Standard Fire and Special Peril Policy from The Oriental Insurance Company Ltd. for ‘Heritage Hotel’,

Bikaner valid upto May 5, 2007. (v) Burglary Insurance from the Oriental Insurance Company Ltd. for Bangalore Branch Office at 102, Skylark

Apartment, Wind Tunnel Road, Murgeshpalya, Bangalore valid upto June 16, 2006. (vi) Office Insurance from the Oriental Insurance Company Ltd. for Bangalore Branch Office at 102, Skylark

Apartment, Wind Tunnel Road, Murgeshpalya, Bangalore valid upto June 16, 2006. (vii) Group Personal accident Insurance Policy from National Insurance Company Ltd. for 137 staff members. (viii) Commercial Vehicle Insurance for various vehicles owned by our Company.

MARKETING AND SELLING ARRANGEMENTS We have developed good business relationship with a number of tour operators located both in India and abroad by providing quality service continuously over the years. In India, we have a network of around 35 local handling agents and about 5 local handling agents in other countries in the India Sub-Continent like Sri Lanka, Bhutan, Myanmar, Nepal and Bangladesh, for executing our business. Over the years, we have established good business relationship with some world renowned tour operators like GeBeCo - Germany, Djoser – Holland, Insight Reisen – Switzerland and Joe Far Reisen – Austria. Our Company has been successful in getting sizable business from these tour operators over the past years. We have a team of marketing professionals having strong selling skills and who regularly take part in various Tourism Fairs organized in various part of the World to promote and market our business. They also continuously update themselves with the latest developments in the Tourism Sector, both in India and abroad, to effectively understand the customer requirements in the various markets and the strategy to satisfy such requirements in the most effective manner. COMPETITION We face competition from other Tour Operators in private and public sector, located in India. Some of them are as follows: Inbound Tourism Outbound Tourism Domestic Tourism Sita – Kuoni World Travel Ltd. La Passage to India Cox & Kings Travel Corporation of India Creative Travels

Sita – Kuoni World Travel Ltd. Thomas Cook Cox & Kings Raj Travels Orbit

Cox & Kings Kesri Travels Raja Rani Travels

Competition will further be enhanced with entry of new players in the industry and expansion by the existing players.

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COMPETITIVE STRENGTHS We face competition from the established large players in our industry. Some of our strengths that differentiates us from our competition are as follows: Our Promoters have a strong understanding of the Tourism Industry.

Our Company has been in the business of providing Tours and Travel Services for the last 18 years . We are

providing services to the Inbound foreign tourists visiting India, Outbound Indian Tourists traveling abroad and domestic tourists traveling within India. We provide services to clients from 26 countries across the globe which include Germany, Holland, Austria, Sweden, Finland, Denmark, Brazil, USA, Spain and East European countries. We are now handling about 10000 clients from various countries on annualized basis. We have our own hotel, transport and ticketing to support our Tour Operation business.

We are having business relationships with world-renowned tour operators like GeBeCo (Germany), Djoser

(Holland), Insight Reisen (Switzerland) and Joe Far (Austria) for the last 10 years. We are active members of the following tourism organizations.

Name of the Organisation Membership No. Indian Association of Tour Operator ACT 891201 DRV (German Association of Travel Agents) 26552 American Society of Travel Agents 90030704 Pacific Asia Travel Association SO – 000556 Confederacion de Organizacioues Touristicas de la America Latina (COTAL)

-

Indo German Chamber of Commerce 1/76678 Our Company is having ISO 9001-2000 accreditions. It reflects our commitment to strong quality systems,

compliance to international standards and to provide finest products and services to our valued customers. Our work force is well qualified and trained to ensure perfection and impeccability in every work area. We also

provide our workforce with a world-class working environment and take sufficient steps to inculcate a sense of belongingness and participation among employees. Skilled manpower and seasoned management, makes it really lethal combination for the competitors. Till date we have been successful in retaining our Core Team. After joining the group no one from the core team has left the organization

Further, we have a team of various foreign language speaking Tour Leaders who have associated with our Company in retainership capacity to cater to the requirement of Inbound Segment.

We have received many awards and Certificates of Merit since 1992 for achievements / excellence in promoting Tourism in India. This includes Second position in 2nd category for the year 2003-04 and 3rd position in 1st category for the year 2001-02. We have been actively engaged in promoting the culture of our country by providing festival tours, Wildlife Safari, Camel Safaris, Ayurveda Tours etc., in addition to routine tour packages.

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REGULATIONS AND POLICIES TOUR OPERATION BUSINESS In India, there is no Central Legislation which governs the Tour Operation business in particular. The generally applicable labour laws, including the Industrial Disputes Act, 1947, the Contract Labour (Regulation and Abolition) Act, 1970, the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, the Minimum Wages Act, 1948, the Payment of Bonus Act, 1965, the Payment of Gratuity Act, 1972 and the Payment of Wages Act, 1936, are applicable to the Company. HOTELS In India there are no Central legislations that govern the hotel industry in particular. However, the Government of India approves projects for construction of hotels and then classifies the same as a star hotel. Being in the hotel Sector, the Company is required to abide by the Environmental Laws, Central Excise Act, and The Prevention of Food Adulteration Act, 1954 as may be applicable. Project approval and Star Classification of hotels from the Department of Tourism, Government of India Under the Tourism Policy of the Government of India, it is optional for Hotels to obtain classification in a star category by applying to the Ministry of Tourism, Government of India. The HRACC assesses the hotel based on various criteria including the quality of facilities provided at the hotel. Upon the Hotel obtaining the qualifying mark prescribed for a particular status of star classification, and based on the recommendation of the HRACC, the Hotel is given the relevant star classification by the Ministry of Tourism. Environmental Laws, Rules and Regulation Prior to setting up a Hotel, relevant environmental consents must be obtained under the Environment (Protection) Act, 1986, the Water (Prevention and Control of Pollution) Act, 1974 and the Air (Prevention and Control of Pollution) Act, 1981.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 investigations to ensure that industries are functioning in compliance with the standards prescribed. These authorities also have the power of search, seizure and investigation if the authorities are aware of or suspect pollution. All industries and factories are required to obtain consent orders from the PCBs, which are indicative of the fact that the factory or industry in question is functioning in compliance with the pollution control norms laid down. These are required to be renewed annually. The issue of management, storage and disposal of hazardous waste is regulated by the Hazardous Waste Management Rules, 1989 made under the Environment Protection Act. Under these rules, the PCBs are empowered to grant authorization for collection, treatment, storage and disposal of hazardous waste, either to the occupier or the operator of the facility. The Ministry receives proposals for expansion, modernization and setting up of projects and the impact which such projects would have on the environment is assessed by the Ministry before granting clearances for the proposed projects. The Central Excise Act, 1944 The Central Excise Act, 1944 provides that a person who is engaged in production or any process of production of any specified goods including liquor shall get himself registered with the proper officer as per the procedure / documentation laid down. The Prevention of Food Adulteration Act, 1954. The Prevention of Food Adulteration Act is a Central legislation and provides provisions for the prevention of adulteration of food. It enables any person/entity manufacturing /storing / selling food articles to be registered under the provisions of the Rules.

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HISTORY AND CORPORATE STRUCTURE Our Company was incorporated as Indo Asia Tours Private Limited on May 02, 1988. The name of our Company was changed to Indo Asia Leisure Services Private Limited on September 23, 2005 vide fresh Certificate consequent to change in name dated September 23, 2005 issued by the Registrar of Companies N.C.T, Delhi & Haryana. Our Company was converted from Private Limited to Public Limited Company under the provisions of section 44 of the Companies Act, 1956 w.e.f October 19, 2005 and accordingly the name of our Company was changed to Indo Asia Leisure Services Limited. Our current promoters are Mr. Sunirmol Ghosh, Mr. Sudesh Behal and Mr. Gajendra Singh Panwar. Our company started operations in 1988, by providing Inbound Tour operation services to our clients. Over a period of 18 years, we have expanded our operations to Domestic and Outbound Tour Operations, Ticketing and Hotels operation. We now provide Inbound Tour operation services to about 10,000 clients on an annualized basis. In the last financial year ended on March 31, 2006, about 20,000 individuals have taken our services.

MAJOR EVENTS IN THE HISTORY OF OUR COMPANY SINCE INCEPTION.

Year Key events, milestones and achievements 1988 Incorporated as Indo Asia Tours Private Limited vide certificate of Incorporation No.11-31449 dated

May 2, 1988. 1988 First break in German Market for Inbound Tour business; associated with GeBeCo, a leading German

tour operator. 1989 Obtained Membership of Indian Association of Tour Operators and international organization such as

PATA. 1990 First break in Holland Market for Inbound Tour business; associated with Djoser, a leading Holland

tour operator. 1993 Ventured into Hotel business by way of investment in a group company, Heritage Inn Pvt. Ltd., which

has a 3 star Hotel property at Jaisalmer. 1996 Two of our promoters left our Company on personal grounds. 1996 Started Operations from Bangalore Office 1999 Started Operations from Chennai Office 2000 Commenced operation of 3 Star Hotel Property in Bikaner (Rajasthan) 2001 Huge dip in Inbound Tourism due to September 11 bombing on World trade Centre, New York. 2003 Awarded 3rd position in 1st category for the year 2001-02 by the Ministry of Tourism 2004 Awarded second position in 2nd category for the year 2003-04, by the Ministry of Tourism 2005 Commenced Outbound & Domestic Tour Operation Service; obtained recognition from Department of

Tourism. 2005 Awarded ISO 9001: 2000 Quality Certificate 2005 Started Operations from Kolkata Office 2006 Started Operations from Goa Office

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CHANGES IN REGISTERED OFFICE OF OUR COMPANY Date of change Previous Address New Address March 22, 1995 E-86, South Extension, Part-1,

New Delhi - 110 049

C-28 Housing Society, South Extension, Part-1, New Delhi- 110 049

The objects clauses of the Memorandum of Association enable our Company to undertake activities for which the funds are being raised in the IPO and also the activities, which our Company has been carrying on till date. MAIN OBJECTS The main objects as per the Memorandum of Association of our Company are as follows:

1. To organize religious, educational, sightseeing and business tours trekking expeditions, conference and for the purpose to charter ships trains, airplanes omni buses, motor buses and carriages of every description to book and reserve accommodation and rooms in hotels, motels, restaurants, boarding and lodging houses.

2. To carry on the business as tourist agents and to facilitate traveling and to provide for tourists and travelers,

or promote the provision of conveniences of all kinds in the way of through tickets, circular tickets, sleeping cars or berths, hotel and boarding and / or lodging, guides, safe deposits, resting rooms, baggage transport and otherwise to charter steamships and aeroplanes for fixed periods or for particular voyages and flights.

3. To carry on the business as Travel Agents, tour operators, clearing and forwarding Agents and the Business

of booking and reserving accommodation, seats, compartments and berths on railways, ships, boats, airplanes, omnibuses, motorcars, motor buses and to issue tickets for the same on their behalf and to hire or own taxies, motor cars and all kinds of public transport/ vehicles.

4. To carry on the business of cargo agents, custom clearing agents, packing and forwarding agents and to

facilitate and promote the distribution and transportation of cargo whether in India or elsewhere and whether by air, rail or sea and to act as shippers, ship brokers, shipping agents, loading brokers and carriers by rail, air and water.

5. To establish, maintain and operate shipping and transport services and all ancillary services for these

purposes or as independent undertaking to purchase, take in exchange, charter, hire or otherwise acquire and to own, work and manage ships, boats of all types and descriptions, aircrafts, motor and other vehicles and employ the same in the conveyance of people and goods to any part of the world

6. To carry on Hotel, Motel and Catering business.

7. To act as a money changer within the meaning of Section 7 of the Foreign Exchange Regulation Act, 1973

subject to the approval of the Reserve Bank of India and subject to such conditions and restrictions as may be imposed by the said Bank. The Company shall not however, do Banking Business as defined in the Banking Act, 1949.

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CHANGES IN OUR MEMORANDUM OF ASSOCIATION Details of amendment in MOA Date Increase in Authorized Capital to 5,00,000 Equity Shares of Rs. 10/- each aggregating to Rs. 50 Lacs.

04.08.1998

Alteration in the object clause of our company to include Hotel/Motel Activity 25.09.1999 Increase in Authorized Capital to 1,00,00,000 Equity Shares of Rs. 10/- each aggregating to Rs. 1000 Lacs.

04.03.2004

Change in name of our Company to Indo Asia Leisure Services Private Limited 23.08.2005 Deletion of word ‘Private’ from the name of our Company consequent to change in status of Company from Private Limited to Public Limited.

30.09.2005

Change in the Main Object Clause to include the object of acting as money changer 13.02.2006 Change in the incidental & Ancillary objects of our company to include BPO & Call Centre Activity

13.02.2006

Change in the other objects of our company to include telemarketing, BPO and Call Centre Activity

13.02.2006

Increase in Authorized Capital to 2,00,00,000 Equity Shares of Rs. 10/- each aggregating to Rs. 2000 Lacs.

12.05.2006

SUBSIDIARY OF THE COMPANY

Our Company does not have any subsidiary as on the date of filing of this Draft Red Herring Prospectus. For further details, please refer to the section titled ‘Group Companies’ beginning on page no. 119 of this Draft Red Herring Prospectus. OTHER AGREEMENTS Except the contracts/agreements entered in the ordinary course of the business carried on or intended to be carried on by our Company, our Company has not entered into any other agreement/contract. STRATEGIC AND FINANCIAL PARTNERS We do not have any strategic or financial partners

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OUR MANAGEMENT BOARD OF DIRECTORS Under our Articles of Association, we cannot have less than 3 directors and more than 12 directors. We presently have six directors on our Board. The day-to-day affairs of our Company are managed by Mr. Sunirmol Ghosh, Director, Mr. Sudesh Behal, Director and Mr. Gajendra Singh, Director under the overall control and supervision of our Board of Directors. The following table sets forth the relevant details of our Board of Directors:

Name, Age, Father’s Name & Address

Designation

Date of Appointment

Other Directorships held

Mr. Sunirmol Ghosh 50 years S/o Mr. Somerendra Kumar Ghosh H- 38/7, Phase – I, DLF Qutub Enclave, Gurgaon, Haryana.

Wholetime Director

02.05.1988

Liable to retire by rotation

Appointed as Wholetime

Director for a period of 5 years w.e.f. 01.04.2005

1) Indo Asia International Private Limited. 2) Indo Asia Hotel Private Limited 3) Indo Asia Tours & Travels Private Limited 4) Carnival Hotels & Resorts Private Limited 5) Holliday Mall.Com Private Limited. 6) Heritage Inn (Bikaner) Pvt. Ltd. 7) Heritage Inn Private Limited 8) Coorg Hotel Private Limited

Mr. Sudesh Behal 49 years S/o Mr. Ram Krishan Behal Block – C, House No. 9066, Sector 9, Vasant Kunj New Delhi

Wholetime Director

02.05.1988

Liable to retire by rotation

Appointed as Wholetime

Director for a period of 5 years w.e.f. 01.04.2005

1) Indo Asia Hotel Private Limited 2) Indo Asia Tours & Travels Private Limited 3) Carnival Hotels & Resorts Private Limited. 4) Holliday Mall.Com Private Limited 5) Heritage Inn (Bikaner) Pvt. Ltd. 6) Heritage Inn Private Limited 7) Coorg Hotel Private Limited

Mr. Gajendra Singh Panwar 50 years S/o Dr. Madan Mohan Singh Block – TG, 1 / 2 Garden Estate, Gurgaon, Haryana

Wholetime Director

19.12.1996

Liable to retire by rotation

Appointed as Wholetime

Director for a period of 5 years w.e.f. 01.04.2005

1) Indo Asia Hotel Private Limited 2) Indo Asia Tours & Travels. 3) Holliday Mall.Com Private Limited. 4) Heritage Inn (Bikaner) Pvt. Ltd.

Mr. Kishore Kumar Lahiri 48 years S/o Justice Kiranmoy Lahiri E- 157, Sector 20, Noida – 201301

Additional Director

08.02.2006 1) S.V.P. Industries Limited

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Mr. Kailash K. Thadani 39 years S/o Brigadier K.N. Thadani 601, Marble Arch 94 Pali Hills, Bandra West, Mumbai

Additional Director

08.02.2006 Nil

Mr. Sidhartha Roy 51 years S/o Mr. M.K. Roy C- 8/8773, Vasant Kunj, New Delhi – 110 070

Additional Director

22.12.2005 Nil

Brief Profile of our Directors is as under:

Mr. Sunirmol Ghosh, aged 50 years, who is a Wholetime Director of our Company, is a Graduate in Science from Udaipur University. He started his career in 1974. At the start of his career he started as a free lancer tour guide apart from studying and doing language course. He did his German Language course from Max Muller Bhavan, Pune and was immediately absorbed by Mercury Travels, one of the leading inbound travel agencies in India. In 1977 he joined Indoculture Tours a leading travel agency headquartered in Stuttgart, which primarily arranged tours for German-speaking leisure tourists travelling to India. Mr. Ghosh worked with them till 1987, when he Co-found Indo Asia Tours. He is proficient in German Language and has travelled widely throughout the world. He has extensive knowledge of Indian Geography. Mr. Sunirmol Ghosh has been instrumental in getting inbound business for our Company from Germany, Austria, Holland, Finland, Scandinavia and Greece. Further, he has been actively involved in developing marketing strategies for our various source markets and promoting India as a tourism destination. Since 2003 he has been an executive member of IATO, the umbrella body of the tour operators in India. Earlier he was holding the same position from 1988 to 2000. Under his leadership and direction, our Company has expanded operations into Outbound and domestic tourism too.

Mr. Sudesh Behal, aged 49 years, who is a wholetime director of our company, is a Masters in Tourism Administration from Delhi University. Further, he has also studied French, German & Spanish Languages. He started his career in 1978 by joining Govan Travels, a Dalmia Cement group company. From 1982 to 1987, Mr. Behal was employed at the Delhi office of Indoculture Tour when he left Indoculture Tours to co-found Indo Asia Tours. He has traveled widely to all parts of the World and has been successful in developing a good business network/ associates. Mr. Sudesh Behal has been instrumental in getting inbound business for our Company from Spain, Portugal and South America. Further, he is also looking after the marketing of our business in China and Japan. He is looking after the day to day operations of our company in addition to exploring new market opportunities for our business.

Mr. Gajendra Singh Panwar, aged 50 years, who is a wholetime director of our Company, is a Graduate in Agriculture from Jaipur University. However Mr. Panwar has been involved in Tourism sector since 1978. He worked as freelancer till 1988, when he associated with Indo Asia Tours. From 1978 to 1983 he completed various levels of German Language course from Max Muller Bhavan in Pune. He is Proficient in German Language and has traveled widely throughout the world to attend various tourism fairs. He has worked with the top travel agents in the world.. Mr. Gajendra Singh Panwar has been instrumental in getting inbound business for our Company from USA, Turkey, Switzerland, part of Austria and Germany. In addition to exploring new market opportunities in these countries, he is

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also responsible for our hotel operations and new hotel projects. Mr. Gajendra Singh Panwar has also been actively involved in promoting India as a tourism destination in USA. He is an active member of American Society of Travel Agent (ASTA) and presently holds the position of Treasurer in ASTA India Chapter. Mr. Kishore Kumar Lahiri, aged 48 years, who is an independent director of our Company, is a B.A. (Hons) and Bachelor of Law from the Delhi University. He started his career in 1986 by way of Independent law practice and has handled over two thousand cases during this period covering a variety of legal matters. He also acted as General Counsel to and represented individual clients as well as prominent Industrial Houses/organizations in the private sector, multinationals and foreign-based companies. Mr. Kailash K. Thadani aged 39 years, who is an independent director of our Company, is a BA (Hons) form Delhi University and has a Post Graduate diploma in Business Management from Cornell-Essec France University. During the period from March 2002 to September 2004, he served as Resident Manager - Intercontinental The Grand, Mumbai and was responsible for entire operation of hotel from the project stage till the commissioning of hotel operations. Thereafter, he joined Leela Group of hotels, Mumbai as Resident manage and was responsible for the operations of the hotel. Since 2005, he has been working with Park Plaza Royal Palms, Mumbai (a 5 star Hotel), in the capacity of General Manager and is responsible for the entire operations and marketing of the hotel. Mr. Sidhartha Roy aged 48 years, who is an independent director of our Company, is a Bachelor in Business Management from Banaras Hindu University and has Post Graduate in Programme Management from Indian Institute of Management, Kolkata. Since the year 2000 he has been associated with Accor Asia Pacific as a Country General Manager based in New Delhi, for outbound travel business. He has worked as General Manager - Marketing and Development in Fortune Hotels Limited. During the period 1979 to 1993, he has served many companies like Spencers, Welcome Group, Oberoi Group and The Hyatt in New Delhi. Borrowing Powers of the Directors The shareholders of our Company have passed a resolution at the Extraordinary General Meeting of our Company held on May 12, 2006 authorizing our Board of Directors pursuant to Section 293(1)(d) of the Companies Act, 1956 to borrow total amount not exceeding Rs. 50 Crores. (Rupees Fifty Crores Only). For details regarding powers of our Board in this regard, please refer to the section titled ‘Main Provisions of the Articles of Association’ on page no. 182 of this Draft Red Herring Prospectus. Details of all contracts entered with Directors/Managers for Remuneration Mr. Sunirmol Ghosh, Wholetime Director In the Board Meeting of our Company held on March 30, 2005, our directors approved the appointment of Mr. Sunirmol Ghosh as the Wholetime Director of our Company with effect from April 1, 2005 for a period of 5 years . The current terms and conditions of his appointment are as under: a) Salary including all allowances, benefits, perquisites Rs.2,25,000/- per month b) Company’s contribution to provident fund, as per Rules of the Company(12% of the basic salary) c) Gratuity, as per Rules of the Company – Nil. d) Leave with full pay and allowance, as per Rules of the Company- Nil e) Medical benefits - Nil f) Leave travel Allowance - Nil g) Functions

He shall exercise duties and functions as may be delegated/assigned to him by the Board of Directors/Committee of Directors from time to time.

h) Sitting Fee He shall not be paid any sitting fee for attending the Meeting of Board or Committee thereof.

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2. Mr. Sudesh Behal, Whole-time Director

In the Board Meeting of our Company held on March 30,2005, our directors approved the appointment of Mr. Sudesh Behal as the Whole-time Director of our Company w.e.f. April 1, 2005 for a period of five years. The current terms and conditions of his appointment are as under:

a) Salary including all allowances, benefits, perquisites Rs.2,25,000/- per month b) Company’s contribution to provident fund, as per Rules of the Company(12% of the basic salary) c) Gratuity, as per Rules of the Company – Nil. d) Leave with full pay and allowance, as per Rules of the Company- Nil e) Medical benefits - Nil f) Leave travel Allowance - Nil g) Functions

He shall exercise duties and functions as may be delegated/assigned to him by the Board of Directors/Committee of Directors from time to time.

h) Sitting Fee He shall not be paid any sitting fee for attending the Meeting of Board or Committee thereof.

3. Mr. Gajendra Singh Panwar, Whole-time Director

In the Board Meeting of our Company held on March 30,2005, our directors approved the appointment of Mr. Gajendra Singh Panwar as the Whole-time Director of our Company w.e.f. April 1, 2005 for a period of five years. The current terms and conditions of his appointment are as under:

a) Salary including all allowances, benefits, perquisites Rs.2,25,000/- per month b) Company’s contribution to provident fund, as per Rules of the Company(12% of the basic salary) c) Gratuity, as per Rules of the Company – Nil. d) Leave with full pay and allowance, as per Rules of the Company- Nil e) Medical benefits - Nil f) Leave travel Allowance - Nil g) Functions

He shall exercise duties and functions as may be delegated/assigned to him by the Board of Directors/Committee of Directors from time to time.

h) Sitting Fee He shall not be paid any sitting fee for attending the Meeting of Board or Committee thereof.

CORPORATE GOVERNANCE The provisions of the Listing Agreement to be entered into with the Stock Exchanges with respect to corporate governance and the SEBI Guidelines in respect of corporate governance will be applicable to our Company immediately upon the listing of our Company’s Equity Shares on the Stock Exchanges. Our Company undertakes to adopt the Corporate Governance Code as per Clause 49 of the Listing Agreement to be entered into with the Stock Exchanges prior to the listing of our Equity Shares. Our Company has complied with such provisions, including with respect to constitution of the following Board Committees: the Audit Committee, Investor Grievance Committee and the Remuneration Committee. We believe in adopting the best corporate governance practices, based on the following principles in order to maintain transparency, accountability and ethics:

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1. Recognition of the respective roles and responsibilities of Board and the management; 2. Independent verification and assured integrity of financial reporting; 3. Protection of shareholder’s right and priority for investor relations; and 4. Timely and accurate disclosure on all material matters concerning operations and performance of the

company.

At present, the following committees have been formed in compliance with the Corporate Governance norms. Audit Committee The Audit Committee was constituted on February 8, 2006. The newly constituted Audit Committee consists of the following Directors of the Board:

1. Mr. Kailash K. Thadani 2. Mr. Sidhartha Roy 3. Mr. Sudesh Behal

The terms of the Audit Committee are to comply with the requirements of Section 292 A of the Companies Act, 1956 and Clause 49 of the listing agreement to be entered into with the Stock Exchange (S). The scope of Audit Committee shall include but shall not be restricted to the following:

a) Oversee our Company’s financial reporting process and disclosure of its financial information to ensure that the financial statements are correct, sufficient and credible.

b) Making recommendations to the Board on the appointment of the external auditor, the audit fee and any question of resignation or dismissal.

c) Review of half-yearly and annual financial statements before submission to the Board. d) Discussion with the external auditors about the internal control system, nature and scope of audit, any

problems or reservations arising from the audit and any matter which the external auditor wishes to discuss. e) Review of external auditor’s management letter. f) Review of Company’s statement on internal control system prior to endorsement by the Board and ensure

compliance of internal control system. g) Review of any significant findings of internal investigation. h) Review of reports of the Internal Auditors.

Remuneration Committee: The Remuneration Committee has been constituted on March 13, 2006. The Committee consists of the following Directors of the Board:

1. Mr. Sidhartha Roy 2. Mr. Kailash K. Thadani 3. Mr. K.K. Lahiri

The powers of this Committee are as follows:

a) To approve remuneration payable to managerial personnel, taking into account the financial position of the Company, trend in the industry, appointee’s qualification, experience, past performance and past remuneration.

b) To bring about objectivity in determining the remuneration package while striking a balance between the interest of the Company and the shareholders.

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Investor Grievance Committee: The Investor Grievance Committee has been constituted on March 13, 2006. The Committee consists of the following Directors:

1. Mr. K.K. Lahiri 2. Mr. Sunirmol Ghosh 3. Mr. Sidhartha Roy

The Committee is authorized to:

a) To approve and register transfer and/or transmission of all classes of shares. b) To sub-divide consolidate and issue share certificates on behalf of the Company. c) To affix / to authorize affixation of the common seal of the Company on the share certificates of the

Company. d) To redress matters relating to share holders and investor complaints like transfer of shares, non-receipt of

balance sheet, non-receipt of declared dividend, etc. e) To do all such acts, deeds or things as may be necessary or incidental to the exercise of the above powers.

Shareholding of the Directors in our Company The following table provides the details of the shareholding of our Directors as on date:

Name of Shareholder Number of shares % Shareholding Mr. Sunirmol Ghosh Mr. Sudesh Behal Mr. Gajendra Singh Panwar

18,74,669 18,74,669 27,78,192

20.83 20.83 30.86

Interest of Promoters and/or Directors All the Directors of our Company may be deemed to be interested to the extent of sitting fees and/or other remuneration, if any, payable to them for attending meetings of the Board or a committee thereof as well as to the extent of reimbursement of expenses, if any, payable to them under our Articles of Association. The Whole Time Directors will be interested to the extent of remuneration paid to them for services rendered by them as officers or employees of our Company. All our Directors may also be deemed to be interested in the Equity Shares in our Company, if any, held by them, their relatives or by the companies and firms in which they are interested as directors / members / partners or that may be subscribed for and allotted to them, out of the present Issue in terms of this Draft Red Herring Prospectus and also to the extent of any dividend payable to them and other distributions in respect of the said Equity Shares. The registered office of our Company is located in premises owned by Our Promoter Directors Mr. Sunirmol Ghosh and Mr. Sudesh Behal. In respect of these premises, our Company has entered into a lease deed dated March 20, 2006 for a period of 24 months w.e.f. 01.12.2005. The lease rental payable for occupation of these premises is Rs. 2,000/- per month (i.e. Rs.1,000/- each to Mr. Sunirmol Ghosh and Mr. Sudesh Behal). Further, an interest free deposit of Rs.5,00,000/- each has been given by our Company to Mr. Sunirmol Ghosh and Mr. Sudesh Behal respectively towards such premises. The interest free deposit is refundable on the expiry or early determination of the lease as the case may be. Our Directors will be deemed to be interested to the extent of these lease rentals. The office space occupied by our Company at C-27, Housing Society, South Extension Part-I, New Delhi- 110 049, is owned by Mrs. Meeta Ghosh and Mrs. Priti Behal, wifes of our promoters Mr. Sunirmol Ghosh and Mr. Sudesh Behal respectively. In respect of these premises, our Company has entered into a lease deed dated March 20, 2006 for a period of 24 months w.e.f. 01.02.2006. The lease rental payable for occupation of these premises is Rs.

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13,000/- per month (i.e. Rs.6,500/- each to Mrs. Meeta Ghosh and Mrs. Priti Behal). Our Directors will be deemed to be interested to the extent of these lease rentals. The Garage leased by our Company, located at Land Bearing Plot No. –180/03, Mahadevpura Village, Krishnaraja Puram Hobli, Bangalore South, Taluk, is owned by our Group Company M/s Transasia Travelnet Pvt. Ltd., which is promoted by Mrs. Meeta Ghosh, Mrs. Priti Behal and Mrs. Sunita Panwar, wifes of our directors Mr. Sunirmol Ghosh, Mr. Sudesh Behal & Mr. Gajendra Singh Panwar respectively. In respect of this premises, our Company has entered into a lease deed dated December 29, 2005 for a period of 11 months w.e.f. 01.01.2006. The lease rental payable for occupation of this premises is Rs. 15,000/- per month. Our Directors will be deemed to be interested to the extent of these lease rentals. The branch office of our Company, located 102, Skylark Residency, Wind Tunnel Road, Murgeshpalya, Bangalore – 560 017, is owned by our Group Company M/s Transasia Travelnet Pvt. Ltd., which is promoted by Mrs. Meeta Ghosh, Mrs. Priti Behal and Mrs. Sunita Panwar, wifes of our directors Mr. Sunirmol Ghosh, Mr. Sudesh Behal & Mr. Gajendra Singh Panwar respectively. In respect of this premises, our Company has entered into a lease deed dated December 29, 2005 for a period of 11 months w.e.f. 01.01.2006. The lease rental payable for occupation of these premises is Rs. 20,000/- per month. Our Directors will be deemed to be interested to the extent of these lease rentals. The Garage leased by our Company, located at Land Bearing Khasra No. 14/1/2, Village Sultanpur Tehsil, Hauz Khas, New Delhi – 110 016, is owned by our Group Company M/s Transasia Travelnet Pvt. Ltd., which is promoted by Mrs. Meeta Ghosh, Mrs. Priti Behal and Mrs. Sunita Panwar, wifes of our directors, Mr. Sunirmol Ghosh, Mr. Sudesh Behal & Mr. Gajendra Singh Panwar respectively. In respect of this premises, our Company has entered into a lease deed dated December 29, 2005 for a period of 11 months w.e.f. 01.01.2006. The lease rental payable for occupation of this premises is Rs. 40,000/- per month. Our Directors will be deemed to be interested to the extent of these lease rentals. The branch office of our Company at 1 K, Mandira Apartment, 23-D, North Boag Road, T Nagar, Chennai – 600 017, is owned by our promoters Mr. Sunirmol Ghosh along with his wife Mrs. Meeta Ghosh and Mr. Sudesh Behal along with his wife Mrs. Priti Behal. In respect of the premises, our Company has entered into a lease deed dated May 6, 2006 for a period of 11 months and is valid up to March 31, 2007. No deposit or lease rental is payable in respect of the referred premises. Our company has entered into the Marketing tie-up agreement with one of our group company “Carnival Hotel & Resorts Pvt. Ltd.(CAHR) under which CAHR has agreed to provide services of active marketing, promotion and providing consultancy services to our hotel unit namely ‘Heritage Resort’ situated at Bikaner. Against these services, our company is making a payment of Rs. 10,000/- per month as retainership fees and an incentive @ 2% on the plan sale of our Hotel unit at Bikaner. The agreement is valid for a period of one year w.e.f. 01.04.2005 and renewable for a further period of 2 years. Changes in the Board of Directors The changes in our Board of Directors during the past three years are as given below:

Name Date of Appointment

Date of Resignation Reason

Mr. Sidhartha Roy 22.12.2005 - Appointed as Additional Director Appointed as Additional Director

Mr. Kailash K. Thadani 08.02.2006 - Appointed as Additional Director Dr. Nitish K. Sengupta 07.11.2005 08.02.2006 Resigned as Additional Director Mr. Chandra Shekhar - 02.02.2004 Resigned as Additional Director

Mr. Kishore Kumar Lahiri 08.02.2006 -

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ORGANISATION CHART

Ticketing Division

GM South India (Mr. Surojeet Ghosh)

Bangalore Branch

Board of Directors

Vice President (Mr. Vinay

Sharda)

Finance, Legal and Admin

GM –Operation

(Mr. Indranil Sinha)

GM – Marketing

(Mr. Munish Abrol)

GM – Operations -

Vacant

Manager – Operations

(Mr. Pramod Bhatnagar)

Domestic, Outbound Division

GM –Travel (Mr.

Sharbashish Palit)

GM – Finance & Accounts

(Mr. Sanjay Gupta)

Company Secretary

(Mr. Bhupinder

Kumar)

Manager PR (Mr. Abhay

Yadav)

Manager – HR (Mrs. Shalini Mishra)

Inbound Division

Hotel Division

GM – Operation

(Mr. Ranveer Singh

Manager – E.Commerce (Mr. Jitender

Singh

Branches

South India & Goa Branch

Kolkata Branch

Chennai Branch

Goa Branch

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KEY MANAGERIAL PERSONNEL

Our Company is controlled and managed by the Board of Directors, which is supported by Senior/middle management team consisting of well-experienced travel industry professionals. The manpower strength of our Company is currently 135 employees, excluding Wholetime Directors Mr. Sunirmol Ghosh, Director looks after the Marketing & Sales Promotion of Travel Operations with emphasis on German Tourists. Mr. Sudesh Behal, Director looks after the Travel Operations of other European countries and Administration of the Company. Mr. Gajendra Singh Panwar, Director looks after the Hotel Division of our Company and the US Market.

The details of our Key Managerial Personnel other than directors are as under: For the details of Directors, please refer to section titled ‘Our Management’ on page no. 70 of this Draft Red Herring Prospectus. INBOUND TOURISM Mr. Vinay Sharda, Vice President (Tours), aged 37 years, has an experience of over 15 years in handling Inbound Operation. He holds a Bachelors degree in Arts (Tourism). He joined our organization in 1996 and is currently designated as Vice President (Tours) in our Company. He is currently looking after the entire Inbound Operations of our Company. Currently, he is drawing a remuneration of Rs. 7.5 lacs p.a. Mr. Surojeet Ghosh, General Manager (South Operations), aged 45 years, has an experience of over 1 8 years in Indo Asia Tours (P) Ltd. He is a Qualified Masters in Business Administration. . Currently, he is working as General Manager (Operation, South & west) in 1988. He is looking after the entire functioning of Operation in West & South India in our Company. Currently, he is drawing a remuneration of Rs 6.6 Lacs p.a. Mr. Indra Neil Sinha, General Manager (Tours), aged 39 years, has an experience of over 16 years in Hospitality industry. He holds a Bachelors degree in Arts and Diploma in Russian and German Language. Prior to joining us, he worked with Chougle Industries. He joined our Company in 1989. Currently, he is working as General Manager (Tours) and looking after the entire functioning of Outbound Operations and Sales. His current remuneration is Rs. 3.8l Lacs p.a. Mr. Sharbashish Palit, General Manager (Travel), aged 36 years, has an experience of over 12 years in Hospitality industry. He holds a degree of MBA, IATA. Prior to joining us, he worked with SITA World Travel Ltd. He joined our Company in 1997. Currently, he is working as General Manager (Travel) and looking after the entire functioning of the Travel Department. His current remuneration is Rs. 4 Lacs p.a. Mr. Abhay Yadav, Manager (PR &Travel), aged 51 years, has an experience of over 20 years in Hospitality industry. He holds a Masters degree in Arts. Prior to joining us, he worked with Gadget India Ltd. He joined our Company in 1988. Currently, he is working as Manager PR and looking after the entire functioning of PR. His current remuneration is Rs. 2.64 Lacs p.a. HOTEL DIVISION Mr. Ranveer Singh (General Manager – Bikaner), aged 46 years, has an experience of over 25 years in Hotel industry. He holds a Bachelors Degree in Commerce. Prior to joining us, he worked with Heritage Inn, Jaisalmer. He joined our Company in year 2000. Currently, he is working as General Manager of Hotel in Bikaner and looking after the entire functioning of the Hotel. His current remuneration is Rs. 2.40 lacs p.a.

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E-COMMERCE Mr. Jitender Singh Walia (Manager), aged 30 years, has an experience of over 9 years in Hospitality industry. He holds a Degree of Bachelor in Commerce with an additional qualification of GNIIT and Advanced Diploma in German Language. Prior to joining us, he worked with Comtek Services (P) Ltd. He joined our Company in year 1997. Currently, he is working as Manager - Information Technology & E-Commerce and looking after the entire functioning of IT & E-Commerce. His current remuneration is Rs. 3.5 lacs p.a. FINANCE & ACCOUNTS Mr. Sanjay Gupta (General Manager), aged 38 years, has an experience of over 8 years in Tours & Traveling industry. He is a Qualified Chartered Accountant and holds a Bachelors Degree in Commerce. He joined our Company in the year 1998. Currently, he is working as General Manager Finance and looking after the entire functioning of Finance and Accounts. His current remuneration is Rs. 2.64 Lacs p.a. ADMINISTRATION Mr. Bhupinder Kumar (Company Secretary), aged 35 years, is a Qualified Company Secretary and holds a Bachelors Degree in Commerce. Prior to joining us, he worked with Bharat Bhushan & Associates, Chartered Accountant. He joined our Company in year 2002. Currently, he is working as a Company Secretary and looking after the entire functioning of Secretarial & Legal. His current remuneration is Rs. 2.4 Lacs p.a. Mrs. Shalini Mishra (Manager HR), aged 26 years, has an experience of over 5 years in the Hospitality industry. She holds a Masters degree in Business Administration- HR. Prior to joining us, she has worked with Hotel Shipra. She joined our Company in the January 2005. Currently, She is working as Manager HR and looking after the entire functioning of the HR Department. Her current remuneration is Rs. 2.4 Lacs p.a. We further undertake that all the above-mentioned Key Managerial Personnel are in the employment of our Company as permanent employees.

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Shareholding of Key Managerial Personnel As on date of filing this Draft Red Herring Prospectus, none of the above mentioned Key Managerial Personnel hold any Equity Shares of our Company. Changes in the Key Managerial Personnel of our Company The following is the brief detail of changes in our Key Managerial Personnel (other than our Promoters or Directors) during the last one year from the date of filing this Draft Red Herring Prospectus with SEBI. For details of changes in our Directors, please refer to section titled ‘Our Management’ beginning from page no. 70 of this Draft Red Herring Prospectus.

Name of the Key Managerial Personnel

Designation Date of appointment

Nature of Change

Mr. Vinay Sharda Vice President – Tours 01.02.2006 Promoted from the post of General Manager – Operations

Mr. Indranil Sinha General Manager – Tours 01.02.2006 Promoted to the post of General Manager – Tours for Domestic and Outbound

Mr. Surojeet Ghosh General Manager – South India

01.02.2006 Promoted to the post of General Manager – South India

There has been no resignation of any Key Managerial Personnel during the last one-year. Bonus or Profit Sharing Plan for the Key Managerial Personnel We do not have any bonus (other than ex-gratia bonus) or profit sharing plan (other than those already mentioned for our Executive Directors) with any of our above mentioned Key Managerial Personnel.

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OUR PROMOTERS AND THEIR BACKGROUND The promoters of our Company are Mr. Sunirmol Ghosh, Mr. Sudesh Behal and Mr. Gajendra Singh Panwar the details of whom are given below: PROMOTERS WHO ARE INDIVIDUALS

Sunirmol Ghosh

Mr. Sunirmol Ghosh, (“Mr. Ghosh”) 49 years, is a Graduate in Science from Udaipur University. He started his career in 1974 as a free lancer tour guide. In 1977 he joined Indoculture Tours, a leading travel agency headquartered in Stuttgart, engaged primarily in arranging tours for German-speaking leisure tourists travelling to India. Mr. Ghosh worked with Indoculture Tours till 1987, when he Co-founded Indo Asia Tours. Mr. Ghosh is proficient in German Language and has travelled widely throughout the world. He has been instrumental in getting inbound business for our Company from Germany, Austria, Holland, Finland, Scandinavia and Greece. He has also been actively involved in developing marketing strategies for our various source markets and promoting India as a tourism destination. Since 2003 he has been an executive member of IATO, the umbrella body of the tour operators in India. Under his leadership and direction, our Company has expanded operations into Outbound and domestic tourism too.

PAN No.: AAHPG 3521 B DIN No. 00004030; Voter ID No.: Not Allotted; Driving License No.: 96051042

Bank Account No.: Syndicate Bank, A/c No. 90492010005291 (Savings Account) Hauz Khas Branch, New Delhi

Passport No. E 3941013 issued at Delhi on 26.12.2002

Sudesh Behal

Mr. Sudesh Behal (“Mr. Behal”), 48 years, is a Masters in Tourism Administration from Delhi University, In 1978, Mr. Behal joined Govan Travels, a Dalmia Cement group company. From 1982 to 1987, Mr. Behal was employed at the Delhi office of Indoculture Tour when he left Indoculture Tours to co-found Indo Asia Tours. He is proficient in Spanish language and has traveled widely to all parts of the World. He has been successful in developing a good business network/ associates across the globe. Mr. Sudesh Behal has been instrumental in getting inbound business for our Company from Spain, Portugal and South America. Further, he is also looking after the marketing of our business in China and Japan. He is looking after the day to day operations of our company in addition to exploring new market opportunities for our business.

PAN No.: AAGPB 1450 K DIN No.00007235; Voter ID No.: Not Allotted; Driving License No.: P97092265

Bank Account No.: ICICI Bank, A/c No. 000701020152 (Savings Account) Vasant Kunj Branch, New Delhi

Passport No. Z – 041712 issued at Delhi on 03.09.1998

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Gajendra Singh Panwar

Mr. Gajendra Singh Panwar (“Mr. Panwar”), 49 years, is a Graduate in Agriculture from Jaipur University. However he has been involved in Tourism sector since 1978. He worked as freelancer till 1988, when he associated with Indo Asia Tours. He is Proficient in German Language and has traveled widely throughout the world. Mr. Gajendra Singh Panwar has been instrumental in getting inbound business for our Company from USA, Turkey, Switzerland, part of Austria and Germany. In addition to exploring new market opportunities in these countries, he is also responsible for our hotel operations and new hotel projects. Mr. Gajendra Singh Panwar has also been actively involved in promoting India as a tourism destination in USA. He is an active member of American Society of Travel Agent (ASTA) and presently holds the position of Treasurer in ASTA India Chapter.

PAN No.: ACYPP 5112 C DIN No.00004053; Voter ID No.: Not Allotted; Driving License No.:RJ-14/DLC/98/6632

Bank Account No.: ICICI Bank, A/c No. 002101010410- (Savings Account) Gurgaon Branch, Gurgaon

Passport No. Z 065029 issued at Jaipur on 18.10.2001 For details of the address and other directorships of our Promoters, please refer to the section titled “Our Management” on page no. 70 of this Draft Red Herring Prospectus. We confirm that the Permanent Account Number (“PAN”), Bank Account details and Passport Number of our Promoters have been submitted to the NSE and BSE, on which our Company proposes to list its Equity Shares, at the time of filing of this Draft Red Herring Prospectus. COMMON PURSUITS There are eight Companies in the same group and one partnership firm –‘ Hotel Hatty’ whose business activities falls in the same sector as that of Indo Asia Leisure Services Limited. The details of the same are: 1. Indo Asia International Limited : The main activity of this company is Tours and Travel Operation. There has

been no business activities in this Company since December 31, 2005. The Company was primarily engaged in Domestic Tour operation and Ticketing. The business of this company has been shifted to Indo Asia Leisure Services Ltd. as part of Indo Asia group consolidation and business -reorganization. w.e.f. January 1, 2006. For details of related business transaction please refer to ‘ Related Party Transaction’ given on page No. 84 of this Draft Red Herring Prospectus.

2. Indo Asia Hotels Pvt. Ltd. The main activity of this company is Constructing and owning Hotels. However,

the Company has not commenced any activity since inception and does not own any hotel property. 3. Carnival Hotels & Resorts Pvt. Ltd. The main activity of this company is providing marketing and

management services to Hotels. For details of related business transaction please refer to ‘ Related Party Transaction’ given on page No.84 of this Draft Red Herring Prospectus.

4. Transasia Travelnet Pvt. Ltd The main activity of this company is providing Tour Operation and Travel

related activities. For details of related business transaction please refer to ‘ Related Party Transaction’ given on

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page No. 84 of this Draft Red Herring Prospectus. The Company is currently not carrying on activities of Tour Operations. The Company owns some land and building, which the company has given on lease to our Company and others and it has mainly lease income in its books.

5. Holiday Mall.com Pvt. Ltd. The main activity of this company is to provide Tourism and internet Services in

India and abroad. However, the Company has not commenced any activity since inception. 6. Indo Asia Tours & Travels Pvt. Ltd. The main activity of this company is to provide Tours and Travels

Service. However, the Company has not commenced any activity since inception. 7. Coorg Hotels Pvt. Ltd. The main activity of this company is carrying of business of establishing and running

hotels, motels, resorts etc. However, the Company has not commenced any activity since inception. 8. Heritage Inn Pvt. Ltd. The main activity of this company is establishing and running hotels, motels, resorts

etc. The Company owns a 3 Star facility Hotel at Jaisalmer by the name ‘ Heritage Inn’. Our Company uses the facility provided by ‘ Heritage Inn’ for providing boarding & lodging facility to the Inbound and domestic tourists. For details of related business transaction please refer to ‘ Related Party Transaction’ given on page No. 84 of this Draft Red Herring Prospectus.

9. Hotel Hatty (Partnership firm). The main activity of this partnership is hotel operations. The firm owns a

Hotel at Coorg having amenities of a 3 Star. Mr. Sunirmol Ghosh and Mr. Sudesh Behal are the partners in this firm. For details of related business transaction please refer to ‘ Related Party Transaction’ given on page No. 84 of this Draft Red Herring Prospectus.

Out of the above group companies, four are non-operative and do not carry out any business activities as such. Further one company, Transasia Travelnet also has only income from lease, which is not our main activity. The business of Indo Asia International Ltd. has already been transferred to our company as part of group reorganization and consolidation. Carnival Hotels is mainly into marketing and management of hotels which is not exactly competitive to our business. Heritage Inn Pvt. Ltd. is owning hotel at Jaisalmer where we neither own nor currently propose to acquire new hotel. ‘Hotel Hatty’, the partnership firm has a hotel in Coorg where we propose to take over a resort property on long term lease. The clientele for hotels and resorts are different. Hence there is no conflict of interest between business carried on by our group company and that by us. INTEREST OF THE PROMOTERS Please refer to the section titled ‘Our Management’ on page 70 of this Draft Red Herring Prospectus.

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RELATED PARTY TRANSACTIONS For the detail of such transaction, please refer to the section titled ‘Financial Statements’ beginning from page no. 87 of this Draft Red Herring Prospectus.

84

CURRENCY OF PRESENTATION Our currency of presentation in this Draft Red Herring Prospectus is Indian Rupee (Rs.) only else otherwise mentioned.

85

DIVIDEND POLICY The declaration and payment of dividends will be recommended by our Board of Directors and approved by our shareholders. However, the declaration of dividend may require prior approval of some of our lenders as per the terms of the loan agreements executed with them. Declaration of dividend will also depend on a number of factors, including but not limited to our Company’s earnings, capital requirements and overall financial condition. Our Company has no stated dividend policy.

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SECTION V - FINANCIAL STATEMENTS

AUDITORS’ REPORT Auditors Report as required by Part II of Schedule II of the Companies Act, 1956

New Delhi Dear Sirs,

d) The impact of extra-ordinary items have been separately disclosed in the attached summary statement.

(i) Accounting Ratios as appearing in Annexure VI to this report.

The Board of Directors, Indo Asia Leisure Services Limited, South Extension Part - 1,

We have examined the financial information of Indo Asia Leisure Services Limited annexed to this report which have been prepared in accordance with the requirements of: a) Paragraph B (1) of Part II of Schedule II of the Companies Act, 1956 (the Act), b) The Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines 2000 (the

Guidelines) issued by the Securities and Exchange Board of India (SEBI) and amendments made thereto from time to time in pursuance of section 11 of the Securities and Exchange Board of India Act, 1992; and

c) The instruction received from the company requesting to examine the financial information referred to above and proposed to be included in the letter of offer of the company in connection with its proposed Initial Public Offer (IPO).

Financial Information of the Company We have examined the attached statement of restated Assets & Liabilities of the company as at 31st March 2001, 31st March 2002, 31st March 2003, 31st March 2004, 31st March 2005 and 28th February 2006 (Annexure - I) and accompanying statement of restated Profit & Loss of the company for the financial year(s) ended 31st March 2001, 31st March 2002, 31st March 2003, 31st March 2004, 31st March 2005 and 28th February 2006 (Annexure – II) as prepared by the company and approved by the Board of Directors. These statements reflect the Assets and Liabilities and Profits and Losses for each of the relevant years as extracted from the balance sheet and profit and loss account for those years audited by us. These statements have been made after making such adjustment / regroupings as in opinion are appropriate and more fully described in the Notes appearing in Annexure III to this report. Based on our examination of these summary statements we confirm that:

a) The impact arising on account of changes in accounting policies adopted by the company has been adjusted with the retrospective effect in the attached summary statements.

b) The previous year adjustments have been made in the summary statements in the years to which they relate. c) The impact of qualifications in auditors report wherever applicable has been adjusted in the attached summary

statements.

The Company has declared / paid dividend in respect of the accounting years ending 31st March 2001, 31st March 2002, 31st March 2003, 31st March 2004 and 31st March 2005 as mentioned in Annexure V to this report. We have examined the following financial information relating to the company prepared by the management and approved by the Board of Directors for the purpose of inclusion in the Offer document:

(ii) Capitalisation Statement as appearing in Annexure VII to this report. (iii) Statement of Tax Shelters as appearing in Annexure VIII to this report.

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(iv) Details of Secured Loans as appearing in Annexure IX to this report. (v) Details of Unsecured Loans as appearing in Annexure X to this report. (vi) Principal Terms of Secured Loans and assets charged as security and principle terms of unsecured loans as

appearing in Annexure XI to this Report.

(vii) Details of Investments as appearing in Annexure XII to this report. (viii) Details of Debtors as appearing in Annexure XIII to this report. (ix) Details of Loans & Advances as appearing in Annexure XIV to this report. (x) Details of Contingent Liabilities as appearing in Annexure XV to this report. (xi) Cash Flow Statements as appearing in Annexure XVI to this report. (xii) Details of Other Income as appearing in Annexure XVII to this report. (xiii) Details of Related Party transaction as appearing in Annexure XVIII to this Report

In our opinion, the above financial information of the company read with Significant Accounting Policies and Notes on Accounts attached in Annexure IV to this report, after making adjustments and regrouping as considered appropriate, has been prepared in accordance with Part II of the Schedule II of the Act and the SEBI Guidelines. This report should not be in any way construed as a re-issuance or re-dating of any of the previous audit reports issued by us nor should this report be construed as a new opinion on any of the financial statements referred therein. This report is intended solely for your information and for inclusion in the offer document in connection with the specific Public Offer of Equity shares of the Company and is not be used, referred to or distributed for any other purpose without our written consent. Thanking you,

For SNR & Co. Chartered Accountants

Suresh Vyas Partner

Membership No. 82658 Date: 03.05.2006 Place: New Delhi

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ANNEXURE - I SUMMARY STATEMENT OF ASSETS AND LIABILITIES AS RESTATED (Rs. in lacs)

As at February 28, 2006

March 31, 2005

March 31, 2004

March 31, 2003

March 31, 2002

March 31, 2001

A. Fixed Assets: Gross Block 1,502.91 1,403.81 1,245.32 1,075.24 1,070.99 1,036.71 Less: Depreciation 499.09 420.93 351.17 302.52 246.90 179.12 Net Block 1,003.82 982.88 894.15 772.72 824.09 857.59 Less: Revaluation Reserve - -- - - -

Net Block After adjustment of Revaluation Reserve 1,003.82 982.88 894.15 772.72 824.09 857.59 Capital Work-in-progress inclusive of Capital Advance 195.06 102.95 74.83 45.00 45.00 45.00

Total 1,198.88 1,085.83 968.98 817.72 869.09 902.59 B. Investments 19.00 97.43 21.50 103.50 43.50 3.50

Inventories 1.02 0.98 0.78 0.87 0.58 0.56 Sundry Debtors 1,117.40 760.83 524.66 348.90 473.32 689.01 Cash and Bank balances 92.42 86.88 75.67 34.76 72.23 58.57 Loans and Advances 526.29 553.27 643.64 693.84 556.31 503.76

Total 1,737.13 1,401.96 1,244.76 1,078.37 1,102.44 1,251.90

D. Liabilities and Provisions: Secured Loans 125.84 183.22 203.03 247.76 256.47 282.47 Unsecured Loans 95.00 95.63 140.55 141.46 96.49 96.96 Current liabilities 602.39 523.06 382.06 187.84 481.21279.41 Provisions 245.50 129.02 79.69 66.38 94.19 90.94 Deferred Tax Liability 142.61 128.20 117.27 111.80 - - Total 1211.34 1059.13 922.60 755.24 726.56 951.58

E. Networth (A+B+C-D) 1,743.67 1,526.09 1,312.64 1,244.35 1,288.47 1,206.41

F. Net worth Represented by (i) Share Capital 900.00 900.00 50.00 50.00 25.00 25.00

Share Application Money - - 0.16 0.16 0.16 0.16 General Reserve 466.20 466.20 1,205.00 1,175.00 1,175.00 1,175.00

(iv) Profit & Loss 11.99 4.05377.47 159.89 46.28 81.11 Foreign Exchange Reserve - - 7.20 7.20 2.20

Net Worth 1743.67 1526.09 1312.64 1244.35 1206.411288.47

C. Current Assets, Loans and Advances

(ii) (iii)

(v) 11.20

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ANNEXURE - II

SUMMARY STATEMENT OF PROFIT AND LOSS ACCOUNT AS RESTATED

(Rs. in lacs) 28.02.2006 31.03.2004 31.03.2001

Year ended 31.03.2005 31.03.2003 31.03.2002Period (11 Months) (12 Months) (12 Months) (12 Months) (12 Months) (12 Months)

Income

Tour Receipts 4077.24 3258.86 2027.52 1002.77 1867.88 2251.40Hotel Sales 141.76 126.86 108.13 69.47 70.51 59.00Other Income 11.27 15.37 4.85 8.07 6.36 6.90Total Income (A) 4230.28 1080.31 3401.09 2140.50 1944.75 2317.30 Expenditure Material consumed 34.74 35.46 30.52 15.99 16.47 11.56Tour Expenses 3121.81 2460.05 1516.94 702.40 1361.62 1754.76Salaries, Wages and Benefits 170.44 111.64 77.43 64.87 76.78 72.59Directors Remuneration 74.25 44.57 36.00 36.00 36.00 36.00Administration and other Expenses

315.63 344.87 231.43 124.70 222.95 178.85

Selling & Distribution Expenses

42.5357.74 42.87 8.15 24.78 23.71

Depreciation 83.97 70.68 56.37 56.24 69.96 61.26Interest & Financial Charges 18.96 30.10 27.51 21.86 30.09 37.62Total Expenditure (B) 3862.33 3155.11 2019.07 1030.21 1838.64 2176.35Net Profit before Tax and Extraordinary Items (A-B)

367.95 245.98 121.43 50.10 106.11 140.95

Taxation Current Tax 148.00 80.50 17.00 3.00 7.88 14.39Deferred Tax 14.42 10.93 13.84 -5.46 -Fringe Benefit Tax - - - - - -

205.53 154.55 98.97 33.26 98.23 126.56

Extraordinary Items (net of tax) Profit/ (Loss) on Sale of Assets 1.38 (1.42) 0.24 (1.19) (2.39) - Profit/(Loss) on Sale of Investments 5.40 (7.84) 9.06 7.69 - -

Loss due to Fire - - (7.37) - - -

Foreign Exchange Fluctuation

5.27

(5.96)

(15.72 ) - (1.19 ) 21.30Net Profit after Extraordinary Items

217.58 139.33 85.18 38.57 95.84 147.86

Sales:

Net Profit before Extraordinary Items

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ANNEXURE III NOTES TO ADJUSTMENTS CARRIED OUT IN RESTATED FINANCIAL STATEMENTS Restated financial statements have been prepared in respect of five years commencing from the financial years ended 31.03.2001 to 31.03.2005 and Eleven months ended on 28.02.2006. As a result of restatement of amounts income and expense, the necessary adjustments have been made against the reserves and corresponding effect have been given to the respective heads in related year balance sheet. Depreciation Written Back Up to financial year 2004 - 2005, the company used to charge depreciation on the Gross Book Value of the Assets without considering the fact that few of them had been fully depreciated. As a result of this, the written down value of such assets became negative. Keeping this in view, the Company has written back the amount of depreciation charged in excess to the tune of Rs. 68.07 Lacs in the Profit and Loss Account as a Prior Period Item. Provision for Gratuity During the year accrued gratuity liability up to 31.03.05 amounting of Rs. 13.69 Lacs, which was not previously considered in the books of account on cash basis has been provided through prior period adjustment account with a view to comply with AS - 15.

Deferred Tax Liability Written Back

The company has adopted Accounting Standards 22 (AS 22) Accounting for Taxation and accordingly the Deferred Tax Liability (DTL) has been calculated, the detail of which is given as under: - Deferred Tax Liability as on 01.04.2005 Rs. 1,58,70,478/- Less: Excess Liability charged written back Rs. 30,51,705/- Add: Deferred Tax Liability for the year Rs. 14,42,284/- Net Deferred Tax Liability Rs. 1,42,61,057/-

On write back of excess depreciation and deferred tax liability charged, provision for gratuity and material regroupings, the Net Profit After Tax, Balance of Profit & Loss Account and Net Block of Fixed Assets has been changed respectively for the F.Y. 2000 - 2001 to 2004 - 2005. Net effect of changes in the restated financial statements are summarised as under:

(Rs. in lacs) Particulars 2000-01 2001-02 2002-03 2003-04 2004-05 Depreciation Reduced By 0.71 2.59 18.94 24.88 20.95 Provision for Gratuity 8.15 1.77 0.54 0.73 2.50 Net Profit before Tax increased by (7.44) 24.15 0.82 18.40 18.45 Deferred Tax Liability increased by - - 6.96 8.74 7.84 Net Profit after Tax increased by (7.44) 0.82 11.44 15.41 10.61

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Material Regroupings Following regroupings has been made to keep in line previous year’s figures with latest audited financial statements:

(i) Foreign Exchange Variation

Upto the financial year ended 31.03.2005, the company has shown turnover in the profit and loss account as net of foreign exchange variation. As per the requirements of AS - 11 on ‘Accounting for the effects of changes in Foreign Exchange Rates’ issued by ICAI, the company should show both gross turnover and Foreign Exchange Variation Separately for meaningful understanding & disclosure of financial statements. The summary statement of Profit & Loss account as restated for the financial year ended 31.03.2001, 31.03.2002, 31.03.2003, 31.03.2004 & 31.03.2005 has been regrouped and disclosed accordingly.

(ii) Profit / (Loss) on sale of Fixed Assets and Short Term Capital Gains / (Loss) on sale of Investments

Profit / Loss on sale of fixed assets and short term Capital loss / Gain on sale of investments has been shown under the head ‘Administrative Expenses’ in the Profit & Loss Account upto Financial Year 2004 - 2005. The same has been shown as a separate item in the summary statement of Profit & Loss account as restated for the financial year ended 31.03.2001, 31.03.2002, 31.03.2003, 31.03.2004 & 31.03.2005 and disclosed accordingly.

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ANNEXURE - IV

SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS FOR THE PERIOD ENDED 28th FEBRURARY 2006

iii. Fixed Assets and Depreciation

In respect of fixed assets taken on finance lease, when there is reasonable certainty that the Company will

obtain ownership by the end of the lease term, depreciation is provided in accordance with the policy followed by the Company for owned assets.

iv. Revenue Recognition

i) Sales are stated net of return and discounts.

A. SIGNIFICANT ACCOUNTING POLICIES i. Basis of Accounting

The accounts of the Company are prepared under the Historical Cost Convention and in accordance with applicable Accounting standards and generally accepted principles of accounting except where otherwise stated. All items of revenue income and expenditure are accounted for under the natural heads of accounts on accrual basis.

ii. Inventories

Raw Materials, stores, spares & tolls are valued at cost (cost formula FIFO basis). Scrap is estimated at realizable value. Stock of material sold by one unit to other is valued at transfer price.

Fixed Assets are stated at cost less accumulated Depreciation. Cost of acquisition or construction is inclusive of freight, duties, taxes and incidental expenses incurred during construction period. Depreciation on fixed assets put to use have been provided on Straight Line Method at the rates in the manner specified in Schedule XIV to the Companies Act, 1956. Depreciation is charged on pro-rata basis in respect of assets acquired / sold during the year. Post impairment, depreciation is provided on the revised carrying value of the asset over its remaining useful life.

Lease

Assets acquired under finance lease are recognized at the lower of the fair value of leased assets at inception and the present value of minimum lease payments, lease payments are apportioned between the finance charges and the reduction of the outstanding liability. The finance charges are allocated to the period during the lease term at a constant periodic rate of interest on the remaining balance of the liability.

All revenues and expenditures are accounted for on accrual basis except wherever stated otherwise:

ii) Revenue from services transactions is recognized as the service is performed. iii) Dividend income is recognized as and when the right to receive its payment is established.

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v. Treatment of Expenditure During Construction Period

Expenditure during construction period is included under Pre-operative expenses and the same is being allocated to the respective fixed assets on the completion of erection / installation.

vi. Foreign Currency Transactions

Exchange differences arising on foreign currency transactions other than those relating to liabilities incurred for the purpose of acquiring fixed assets, are recognized as income or expenses for the year as the case may be. Any Profit or Loss arising on cancellation or renewal of a forward exchange contract is also recognized as income and expense for the year. All current assets and current liabilities in any foreign currency outstanding at the end of the year are translated by applying the closing rates or the rate as per forward exchange contract, if any.

vii. Investments

Current investments are valued at acquisition cost or market value whichever is lower. Long Term investments are valued at acquisition cost. Diminution in value of long-term investment is provided only if such a diminution is other than temporary in the opinion of the management.

viii. Amortization of Miscellaneous Expenditure

xii. Taxes on Income

Preliminary Expenses / share issue expenses are amortized over a period of ten years.

ix. Employees Retirement Benefits

i) The Contribution to the Provident Fund, under the defined contribution plans is charged to revenue. ii) Gratuity Liability to employees is provided for on accrual basis based on valuation made by the

independent actuary as at the balance sheet date. The Company makes annual contributions to a fund managed by the Life Insurance Corporation of India (LIC) for an amount notified by the LIC. The company accounts for the liability for future gratuity benefits based on an external actuarial valuation carried out annually.

x. Borrowing Costs

Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of that asset up to the date of such asset is ready for its intended use. All other borrowing costs are charged to revenue in the period when they are incurred.

xi. Earnings per share

Basic earning per equity share is calculated by dividing the net profit for the year attributable to equity shareholders by the weighted average number of equity shares outstanding during the year. Diluted earning per share is calculated by dividing the net profit attributable to the equity shareholders by the weighted average number of equity shares outstanding during the year (adjusted for the effects of dilutive options).

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Current tax is determined on the amount of tax payable in respect of taxable income for the year. Deferred tax assets / liabilities is provided on significant timing differences arising from the different treatments in accounting and taxation of relevant item. Deferred tax assets / liabilities shall be reviewed as at each Balance Sheet date, based on development during the year, to reassess realization / liabilities. Deferred Tax Assets in respect of accumulated Loss and Unabsorbed Depreciation are recognized and carried forward only if there is virtual certainty of its realization.

xiii. Impairment of Assets

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value and impairment loss is charged to profit and loss account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

xiv. Provisions, Contingent Liabilities and Contingent Assets

Provision involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in notes. Contingent assets are neither recognized nor disclosed in the financial statements.

B. NOTES ON ACCOUNTS

(1) Freehold land includes land aggregating to Rs. 169.19 Lacs (Previous Year 2004 - 2005 Rs. 160.07 Lacs), which is registered in the name of the Company.

Particulars As on 31.03.05 (Rs.) Additions (Rs.) As on 28.02.06 (Rs.) Land – Garage - Vasant Kunj 4,17,212/- NIL 4,17,212/-

1,54,77,064/- 1,63,88,920/- Land – Ganga Risala 1,12,500/- NIL 1,12,500/-

9,11,856/- 1,69,18,632/-

Land – Gurgaon 9,11,856/-

Total 1,60,06,776/- (2) Further, cars having gross book value of Rs. 26.07 Lacs purchased at Delhi Office during the period

01.04.2005 to 28.02.06. The details are as follows –

Date of Acquisition Type of Vehicle Amount (Rs.) Car 3,73,613/-

01.02.06 Car 7,44,555/- 23.01.06 Car 14,88,957/-

Total 26,07,125/-

31.08.05

(4) The amount of exchange rate difference in respect of foreign exchange Fluctuation recognized in the Profit and Loss Account for the year Rs. 5.27 Lacs Cr (Previous Year Rs. 5.99 Lacs Dr).

(3) Bank Guarantee provided to Hotels to the extent of Rs. 7.50 Lacs (Previous Year Rs. 7.50 Lacs) and to

Customs and Others to the extent of Rs. 25.56 Lacs (Previous Year Rs 9.92 Lacs)

(5) All the Current Assets, Loans and Advances, in the opinion of the Board, have a value on realization which

in the ordinary course of business shall at least be equal to the amount, at which it is stated in the Balance Sheet.

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As on 28.02.06

(6) Balances of certain Sundry Debtors, Creditors and Advances are subject to confirmation.

(7) Disclosure in respect of:

(a) Operating Lease

The company has entered into Operating Lease for premises. These leasing agreement are non-cancelable and are usually renewable by mutual consent on mutually agreeable terms. The lease rental has been charged as rent.

(Rs.) Place Delhi Office 14,11,200/- Heritage Resort, Bikaner (Staff Qtrs.) 99,000/- Goa Office (w.e.f. Feb 2006) 10,500/-

Total 15,20,700/-

(b) Finance Lease

The Company has entered into finance lease arrangement for vehicles-

(Rs.) Name of the Financier Lease Paid for the

period ended 28.02.06 Principle Amount Kotak Mahindra Bank Ltd. 17,23,093/-

1,46,590/- ICICI Bank Limited. (Santro) 58,791/- ICICI Bank Limited- (Wagon R) 54,347/- HDFC Bank Limited (Ford Ikon) 1,47,160/-

21,29,981/- Finance Charges Kotak Mahindra Bank Ltd. 2,95,605/-

25,080/- ICICI Bank Limited. (Santro) 7,187/- ICICI Bank Limited (Wagon R) 13,219/- HDFC Bank Limited (Ford Ikon) 36,638/- Sub Total (B) 3,77,729/- Total Amount (A+B) 26,72,540/-

ICICI Bank Limited (Ford Fusion)

Sub Total (A)

ICICI Bank Limited (Ford Fusion)

(8). Auditor’s Remuneration (Rs.)

Particulars 2004-2005 Statutory Audit Fees 32,400

77,800 Total 1,10,200

Other Matters

*Remuneration to Auditors becomes due on 31st of March every year. Hence no provision has been made for the same in the financial statements for the current period ended on 28.02.2006.

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(9) Remuneration to Directors

(Rs.) Particulars 28.02.2006 31.03.2005 Salaries 74,25,000/- 44,57,160/- Perquisites - - Commission - -

Total 74,25,000/- 44,57,160/-

(10) The previous year’s figures have been re-arranged, regrouped, reclassified, wherever necessary to make

them comparable.

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ANNEXURE - V RATESOF DIVIDEND PAID

(Rs. in lacs) For the year ended 31.03.2005 31.03.2004 31.03.2003 31.03.2002 31.03.2001 Equity Share Capital 900.00 50.00 50.00 25.00 25.00

10.00 10.00 10.00 10.00 10.00 Nos. (Lakhs) 90.00 5.00 5.00 2.50 2.50 Rate of Dividend (%) Equity - Interim - 20% - 50% - - Final 30% 10% 30% - 100% Amount of Dividend Equity - Interim - 10.00 - 12.50 - - Final 15.78 5.00 8.90 - 5.75 Corporate Dividend tax 2.06 1.89 1.14 1.28 0.64

Face Value (Rs.)

*Final dividend amount of Rs.15.78 as on 31.03.2005 has been arrived as under:

Particulars Rs. No. of Days Held

% of Dividend

Pro rata Div.(Rs.)

Equity Share Capital as on 01.04.04 50 365 30% 15 Right Issue on 30.03.05 100 2 30% 0.16 Bonus Issue on 31.03.05 750 1 30% 0.62 15.78

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ANNEXURE – VI

ACCOUNTING RATIOS

(Rs. in lacs) For the year ended

Particulars Period Ended

28.02.2006 31.03.2005 31.03.2003 31.03.2002 31.03.2001

a) Basic Earnings per share (Rs.) 2.42 1.74 1.06 0.48 1.24 1.90 b) Return On Net Worth (%) 12.48% 9.13% 6.49% 3.10% 7.44% 12.26% c) Net Asset Value / Book value Per share (Rs.) 19.37 16.96 262.53 248.87 515.39 482.56 Profit available to the Shareholders 217.58 139.68 85.18 38.57 95.84 147.86 No. of Equity Shares 90.00 2.50 90.00 5.00 5.00 2.50 Calculation of Weighted Average no. of equity Shares 90.00 80.05 80.00 77.97 77.50 77.70

1,743.66 1,526.09 1,312.64 1,244.35 1,288.47 1,206.41

31.03.2004

Net Worth

a. EPS = Adjusted Net Profit for the year/Weighted Average No. of equity shares (As per AS-20)

b. Net Asset Value per equity share (Rs.) = Net worth / No. of equity shares outstanding at year end c. Return on Net worth (%) = Adjusted Profit after tax / Net worth d. Net worth for this purpose means equity share capital + Reserves & Surplus – Miscellaneous Expenditure not written off.

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ANNEXURE - VII

CAPITALIZATION STATEMENT

(Rs. in lacs)

Particulars Pre- Issue as on

28.02.2006 Post Issue* Long Term Debt Secured Loans 125.84 * Add: Unsecured Loans 95.00 * Total Debt 220.84 Less: Short term Debts - * Total Long Term Debts 220.84 * Shareholders' Funds * Equity Share Capital 900.00 * Reserves & surplus 843.67 * Less: Miscellaneous Expenditure - * Total Shareholders' Funds 1743.67 * Long Term Debt / Shareholders funds 0.13 *

* Post Issue Share Capital & Reserves can be ascertained only on the finalisation of the issue price and by conclusion of the issue process. Notes: 1. Short Term Debt represents debts, which are due within 12 months from 28.02.2006 and include current portion

of vehicle loan and current position of long term debt-secured 2. Long Term Debt represents other than short-term debts as defined above 3. The figures disclosed above are based on the restated financial statements of the Company as at 28.02.2006.

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ANNEXURE VIII STATEMENT OF TAX SHELTERS

(Rs. in lacs)

Year ended 31.03.2005 31.03.2004 31.03.2003 31.03.2002 31.03.2001 Net Profit / (Loss) before Tax as per books 212.32 79.49 37.01

97.91

157.70

Tax Rate (A) 0.365925 0.35875 0.3675 0.3570 0.3955 Tax on Actual Profit (B) 77.69 28.52 13.60 34.95 62.37 Adjustments Permanent Differences Dividend Income (12.58) - - - - Loss on Sale of Investments 7.85 (9.05) (7.70) - - Loss on Sale of Assets 1.41 (0.23) 1.19 2.39 - Other Adjustments - - - - - Timing Differences Difference between - Tax depreciation (101.54) (97.99) (118.69) (156.42) (193.52) Book depreciation 91.62 81.25 75.18 72.54 61.97 Disallowance u/s 36(1)(iv) - - 0.04 - - Disallowance u/s 36(1)(va) - - 1.81 1.20 0.70 Brought forward Unabsorbed Depreciation - (4.65) - - - Net Adjustments (C) (13.24) (30.67) (48.17) (80.29) (130.85) Tax Shelter (D)= (C )* (A) [But restricted to (B)] 4.85 11.01 13.60 28.66 51.75 Total Taxation (B) – (D) 72.85 17.52 - 6.29 10.62 Notes to the tax shelter statement 1. The above statement of tax shelters has been prepared as per the audited accounts of the Company and not on

the basis of restated profits. 2. The permanent / timing differences have been computed considering the acknowledged copies of the income

tax returns filed by the company each of the respective years stated above.

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ANNEXURE IX

SECURED LOANS

(Rs. in lacs) As at 28.02.2006 31.03.2005 31.03.2004 31.03.2003 31.03.2002 31.03.2001

(A) Working capital loan from Bank

- - - 10.44 4.39 7.47

(B) Kotak Mahindra Bank Ltd.

27.73 44.96 25.01 - - -

ICICI Bank Limited 14.55 7.37 - - - - HDFC Bank Limited

3.38 4.87 - - - -

(C) Term Loan from Tourism finance Corp. of India. (Including Interest)

80.18 126.02 178.02 237.32 252.08 275.00

Total A + B+C 125.84 183.22 203.03 247.76 256.47 282.47 Notes: 1. Term Loan from TFCI is Secured against the movable and Immovable Property of the company located in the

Hotel unit at Bikaner. 2. Loan from Kotak Mahindra bank limited is secured against coaches. 3. Loan from ICICI Bank Limited and HDFC Bank Limited is secured against vehicles.

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ANNEXURE X DETAILS OF UNSECURED LOANS

(Rs. in lacs)

As at 28.02.2006 31.03.2005 31.03.2004 31.03.2003 31.03.2002 31.03.2001

From Directors (A) - 0.63 45.55 46.46 1.49 1.96 From Others (B) Charanjeet Kocchar 40.00 40.00 40.00 40.00 40.00 40.00

Heritage Inn Pvt. Ltd. 45.00 45.00 45.00 45.00 45.00 45.00

Surender Nagpal 10.00 10.00 10.00 10.00 10.00 10.00 Sub Total (B) 95.00 95.00 95.00 95.00 95.00 95.00

Total 95.00 95.63 140.55 141.46 96.49 96.96

103

ANNEXURE XI

PRINCIPLE TERMS OF SECURED LOANS AND ASSETS CHARGED AS SECURITIES AND

PRINCIPLE TERMS OF UNSECURED LOANS AS ON FEBRUARY 28, 2006

Principle Terms of Secured Loans And Assets Charged As Securities as on 28.02.2006

Term Loans

(Rs. in Lacs)

Name of Lender Overall Limit Interest

Rate (%)

Repayment

Schedule

Security Created Outstanding

Amount

ICICI Bank

Limited

- Santro

- Wagon R

- Ford Fusion

- Honda City

2.00

3.53

5.64

6.25

-

-

-

-

EMI of Rs. 5,998

for 36 months

(07.12.2004 -

07.10.2007)

EMI of Rs. 11,261

for 36 months

(01.10.2005 -

01.08.2008)

EMI of Rs. 17,167

for 36 months

(01.05.2005 –

01.04.2008)

EMI of Rs. 20,608

for 36 months

(05.02.2006 –

05.01.2009)

Hypothecation of

Vehicles

Hypothecation of

Vehicles

Hypothecation of

Vehicles

Hypothecation of

Vehicles

1.14

2.99

4.17

6.25

104

105

Kotak Mahindra

Bank Limited

1 Tempo

Traveller

2 Chassis

LCV, MUV and

Three Wheelers

– Goods – Ashok

Leyland – E

COMET

6.6835 EMI of Rs. 21,735

each for 35 months

(16.02.2004 -

10.12.2006)

2 Chassis

Heavy

Commercial

Vehicle – Bus –

Telco – LP

1510/52 PS

CMVR 60%

Heavy

Commercial

Vehicle – Bus –

Telco – LP

1510/52 PS

CMVR 60%

5.00

15.70

14.98

7.25

7.32

EMI of Rs. 16,261

for 35 months

(16.02.2004 -

10.12.2006)

EMI of Rs. 25,093

each for 35 months

(22.01.2005 -

20.11.2007)

EMI of Rs. 23,969

each for 35 months

(22.01.2005 -

20.11.2007)

EMI of Rs. 23,585

each for 35 months

(25.03.2004 -

20.01.2007)

EMI of Rs. 23,813

each for 35 months

(25.03.2004 -

20.01.2007)

Hypothecation of

Vehicles

Hypothecation of

Vehicles

Hypothecation of

Vehicles

Hypothecation of

Vehicles

Hypothecation of

Vehicles

Hypothecation of

Vehicles

27.73

HDFC Bank

Limited

- Ford Ikon

5.29

-

EMI of Rs. 16,815

for 36 months

(18.02.2005 -

07.01.2008)

Hypothecation of

Vehicles

3.38

Tourism Finance

Corporation of

India Limited

275.00 12% Rs. 11.46 lacs per

quarter

Hotel Property at

Bikaner, Shares of

directors upto Rs.

4.00 Lacs and all

movable and

immovable

properties of

IALSL.

80.18

Total 125.84

Principle Terms of Unsecured Loans as on February 28, 2006

No terms for repayment of unsecured loans has been stipulated and hence the details are not applicable.

106

ANNEXURE XII

DETAILS OF INVESTMENTS

(Rs. in Lacs)

As at Particulars 28.02.2006 31.03.2005 31.03.2004 31.03.2002 31.03.2001Trade (Quoted) Long Term Quoted 2000 Units of UTI - 2.00 2.00 2.00 2.00 2.00 20 Bonds of IDBI 1.00 1.00 1.00 1.00 1.00 1.00 50 Bonds of SBI - - 0.50 0.50 0.50 0.50 Short Term Quoted Franklin India Flexi Cap Fund

- - - - -

Kotak Midcap 10.00 - - - - Magnum Midcap Fund

- 5.00 - - - -

Reliance Equity Opp. Fund

- 10.00 - - - -

SBI MF Magnum Midcap

- - - -

Sundaram India Leadership Fund

- 6.23 - - - -

Reliance Growth Fund Div. Plan

- 5.00 - - - -

Sundaram Smile Fund

15.00 - - - -

Tata Equity Opp. Fund

- 5.00 - - - -

Kothari Pioneer Income Builder Account

- - *50.00 *20.00 -

Templeton Growth Plan

- 50.00 *20.00 -

Sub total 1.00 79.43 103.50 43.50 3.50 Trade (Unquoted) 18.00 18.00 18.00 - - -

Total 19.00 97.43 21.50 103.50 43.50 3.50 Market Value of Quoted Investments

- 77.49 3.50 65.15 3.50 3.50

31.03.2003

15.20

5.00 -

-

3.50

*Market values could not be obtained, hence not considered.

107

ANNEXURE XIII

DETAILS OF DEBTORS

(Rs. in Lacs) As at Particulars 28.02.2006 31.03.2005 31.03.2004 31.03.2003 31.03.2002 31.03.2001

Sundry Debtors (Unsecured considered good) Outstanding for more than 6 months

7.73 2.81 4.93 121.79 51.13

105.36 30.93 16.96 32.24 1003.15 651.51 414.37 235.74 334.57 605.64

Total 1117.40 760.83 524.66 348.90 473.32 689.01

82.23

Outstanding for more than 3 years 106.52 106.51 Other Debts

108

ANNEXURE XIV DETAILS OF LOANS AND ADVANCES

(Rs. in Lacs) As at Particulars 31.03.2005 31.03.2004 31.03.2003 31.03.2002 31.03.2001

Income Tax 155.76 70.14 58.46 106.26 91.13 Insurance Claim Recoverable - - - 14.28 14.28 14.28 Security Deposits 172.45 17.33 11.23 11.09 11.06 12.64 Other Advances 198.08 487.30 562.27 610.01 24.71 385.71 Total 526.29 553.27 643.64 693.84 156.31 503.76

28.02.200648.64

109

ANNEXURE XV

DETAILS OF CONTINGENT LIABILITIES

(Rs. in Lacs)

As at Particulars 28.02.2006 31.03.2005 31.03.2004 31.03.2003 31.03.2002 31.03.2001Bank guarantee: Hotels 7.5 7.50 7.50 5.20 5.20 9.75

25.56 9.92 8.16 - - Total 33.06 17.42 15.66 5.20 37.31 9.75 Customs & others 32.11

110

ANNEXURE XVI

CASH FLOW STATEMENT AS RESTATED (Rs. In Lacs)

As at 28.02.2006 31.03.2005 31.03.2004 31.03.2003 31.03.2002 A CASH FLOW FROM OPERATING

ACTIVITIES Net Profit before Tax, Appropriations

and extra ordinary items

380.00 230.76 107.64 55.41 103.72 162.25 Adjusted for Depreciation (As Adjusted) 83.97 70.68 56.37 56.24 69.96 61.26 Provision for Gratuity 2.38 2.50 0.73 0.54 1.77 8.15 Loss / (Profit) on Sale of Assets (1.38) 1.42 1.19 2.39 - Loss / (Profit) on Sale of Investments 7.84 - - - - Dividend income (0.58) (12.58) (9.06) (7.69) - -

Interest income

(27.59) (1.84) (2.32) (4.00) (4.38) (2.85) Diminution / (Increase) in value of

Capital Work in progress (92.11) 3.52 (3.52) - - 669.03

Interest & Finance Charges Paid 18.96 30.10 27.51 21.86 30.07 37.62 Direct Taxes Paid (including Dividend

Tax) (38.82) (32.86) (14.09) 6.70 (17.05) (35.43) Other Receipts - 6.92 - - -

Operating Profits before Working Capital Changes

319.43 299.54 169.94

Adjustments for Working Capital Changes

Trade Payables & Other Liabilities 141.00 194.21 (91.57) Inventories 0.07 (0.27) (0.02) Trade and Other Receivables (356.57) (236.17) (175.76) 124.41 215.69 (316.75) Loans & Advances 134.10 67.45 47.59 (185.33) (37.43) (56.06) Cash Flow before Extra-Ordinary

Items

116.22 271.62 236.05

(22.51) 162.93 672.89 Extra Ordinary Items(Loss due to Fire) - - 7.38 - - - Net Cash Flow from Operating

Activities

116.22 271.62 243.43

(22.51) 162.93 672.89

B CASH FLOW FROM INVESTING ACTIVITIES

Sale of Fixed Assets 12.00 0.50 2.54 1.90 3.40 2.01 Purchase of Investments - (82.34) - (100.00) (40.00) (3.00) Purchase of Fixed Assets (115.51) (161.34) (180.09) (7.96) (42.24) (737.87)

Sale of Investments - 91.06 47.69 - - Dividend & Interest Income 0.93 13.10 4.50 3.31 4.24 Advance for Capital Commitment - (31.63) (26.31) - - Net Cash Flow from Investing

Activities

(18.75)

(261.71)

(108.30)

(55.06) (74.60)

(737.18)

Particulars 31.03.2001

(0.24) (5.40)

130.25 186.48 900.03

19.31 (201.79) 146.23 (0.04) (0.20) (0.56)

83.83 1.68

-

111

C CASH FLOW FROM FINANCING

ACTIVITIES Proceeds from issuance of Share Capital

- - 21.00

(53.66)

(17.37)

(42.73)

(16.88) 76.21

Receipt / (Repayment) of Unsecured Loan

(0.63)

(44.93)

(0.90) 44.98 (0.47)

(0.09)

Share Application Money - (0.16) - - - 0.16 Dividend Paid (15.78) (5.00) - (18.25) - Interest Paid (17.39) (32.55) (29.51) (13.70) (30.09) (37.61) Net Cash used in Financing Activities

(0.01) (92.04) 39.40 (74.81) 59.67 D NET INCREASE IN CASH AND

CASH EQUIVALENTS (A+B+C) 10.02 9.90 43.09 (38.17) 13.52 (4.63) CASH AND CASH EQUIVALENTS

(OPENING BALANCE) 82.41 72.51 29.42 67.59 54.07 58.69 CASH AND CASH EQUIVALENTS

(CLOSING BALANCE)

92.42 82.41 72.51 29.42 67.59 54.07

100.00 25.00 -

Proceeds / (Repayment) from Secured Loans (26.00)

(18.90)

(87.46)

1. Cash and Cash Equivalents represent Cash, Bank Balances and Term Deposits along with the Interest Accrued

thereon.

Notes:

2. Previous year figures have been regrouped / rearranged wherever consider necessary.

112

ANNEXURE XVII

STATEMENT OF OTHER INCOME (Rs. in Lacs)

As at Particulars 28.02.2006 31.03.2005 31.03.2004 31.03.2003 31.03.2002 31.03.2001

Dividend on Investment 0.58 12.58 - - - Interest Received 0.26 1.84 2.32 4.00 4.38 2.85 Commission - - 0.51 0.16 0.01 0.11

10.43 0.95 2.02 3.91 1.97 3.94 Total 11.27 15.37 4.85 8.07 6.36 6.90

-

Miscellaneous Income

113

ANNEXURE XVIII LIST OF RELATED PARTIES AS ON FEBRUARY 28, 2006

Relationship Key Management Personnel Nature of Transactions Mr. Sunirmol Ghosh Mr. Sudesh Behal Mr. Gajendra Singh Panwar Mr. Surojeet Ghosh

Director Remuneration

Professional Fees & Salary

Rent Mrs. Priti Behal Mrs. Meeta Ghosh

Promoter/Director Promoter/Director Promoter/Director Brother of promoter Wife of Sudesh Behal Wife of Sunirmol Ghosh

Director Remuneration

Director Remuneration

Rent

Nature of Relationship

Name of the Enterprises having same management personnel and/or their relatives as the reporting enterprises with whom the company has entered into transaction during the half year.

Name of the Concern

Transasia Travelnet Pvt. Ltd. Hotel Hatty

Indo Asia International Pvt. Ltd. Heritage Inn Pvt. Ltd.

Group Company Group Company Associate Concern - Sudesh Behal & Sunirmol Ghosh are partners Wife of Sunirmol Ghosh is the Proprietor. Group Company Group Company

Carnival Hotel & Resorts Pvt. Ltd.

Signature Eventz

Details of the list of related parties and nature of relationship

Particulars Financial year ended 28.02.06 31.03.05 31.03.04 31.03.03 31.03.02 31.03.01

Name of the party

Name of the party

Nam Name of the party

Name of the party

Associates (1) Hotel Hatty (2) Signature eventz

(1) Hotel Hatty (2) Signature eventz

(1) Hotel Hatty (2) Signature eventz

(1) Hotel Hatty

(1) Hotel Hatty

(1) Hotel Hatty

Group companies

(1) Carnival Hotel and Resorts Pvt. Ltd (2) Transasia Travelnet Pvt. Ltd (3) Heritage Inn Pvt. Ltd

(3) Transasia Travelnet Pvt. Ltd

(1) Indo Asia International Pvt. Ltd

(1) Indo Asia International Pvt. Ltd

(1) Indo Asia International Pvt. Ltd (2) Carnival Hotel and Resorts Pvt. Ltd

(4) Heritage Inn Pvt Ltd

(1) Indo Asia International Pvt. Ltd

(2) Carnival Hotel and

Resorts Pvt. Ltd (3) Transasia Travelnet Pvt. Ltd (4) Heritage Inn Pvt Ltd

(2) Carnival Hotel and Resorts Pvt. Ltd (3) Transasia Travelnet Pvt. Ltd (4) Heritage Inn Pvt Ltd

(1) Indo Asia International Pvt. Ltd (2) Carnival Hotel and Resorts Pvt. Ltd (3) Transasia Travelnet Pvt. Ltd (4) Heritage Inn Pvt Ltd

(2) Carnival Hotel and Resorts Pvt. Ltd (3) Transasia Travelnet Pvt. Ltd (4) Heritage Inn Pvt Ltd

Directors and relatives

(1) Sunirmol Ghosh (2) Sudesh Behal (3) Gajendra Singh Panwar (4) Surojeet Ghosh

(1) Sunirmol Ghosh

(3) Gajendra Singh Panwar

(5) Meeta Ghosh (6) Priti Behal

(2) Sudesh Behal (3) Gajendra Singh Panwar (4) Surojeet Ghosh (5) Meeta Ghosh (6) Priti Behal

(1) Sunirmol Ghosh (2) Sudesh Behal

(4) Surojeet Ghosh (5) Meeta Ghosh (6) Priti Behal

(1) Sunirmol Ghosh (2) Sudesh Behal (3) Gajendra Singh Panwar (4) Surojeet Ghosh (5) Meeta Ghosh (6) Priti Behal

(1) Sunirmol Ghosh (2) Sudesh Behal (3) Gajendra Singh Panwar (4) Surojeet Ghosh (5) Meeta Ghosh (6) Priti Behal

(1) Sunirmol Ghosh (2) Sudesh Behal (3) Gajendra Singh Panwar (4) Surojeet Ghosh (5) Meeta Ghosh (6) Priti Behal

Nature of relationship

Name of the party

e of the party

114

RELATED PARTY TRANSACTIONS Details of transaction with related parties: (Rs. In Lacs)

Financial year ended Particular Name of the

enterprise Nature of relationship 28.02.06 31.03.05 31.03.04 31.03.03 31.03.02 31.03.01

Purchase of Services Purchase of Air tickets

Purchase of Boarding and Lodging facility

Purchase of Tickets

Indo Asia International Pvt. Ltd.

Group Company

Proprietor is wife of Sunirmol Ghosh

Proprietor is wife of Sunirmol Ghosh

1.52

6.73

148.64

Event Management

Purchase of Boarding and Lodging facility Purchase of Domestic Tickets

Payment for Package Tours

Signature Eventz Hotel Hatty

Heritage Inn Pvt. Ltd. Carnival Hotel & Resorts P. Ltd Signature Eventz Signature Eventz

Proprietor is wife of Sunirmol Ghosh Associate Concern Group Company Group Company

-

2.23

1.77

15.19

0.43

0.41

2.07

-

22.93

2.36

-

-

-

0.03

2.76

18.23

-

-

-

-

1.42

8.00

-

-

-

245.00

-

-

1.58

18.81

-

-

-

-

-

5.18

24.69

-

-

Finance Loans & Advances Loans & Advances

Hotel Hatty

Surojeet Ghosh

Associate Concern Brother of Sunirmol Ghosh

-

0.31

-

-

-

-

-

-

-

-

-

-

115

Expenses Director Remuneration Director Remuneration

Security Deposit

Surojeet Ghosh

Hotel Hatty

Signature Eventz

Indo Asia international (P) Ltd.

Wife of Sudesh Behal

Director

Director

Group Company

24.75

24.75

5.50

Director Remuneration Professional Fees (Upto 31.01.2006) Rent Rent Rent

Security Deposit Lease Deposit

Commission Commission

Sunirmol Ghosh

Sudesh Behal Gajendra Singh

Priti Behal

Meeta Ghosh

Transasia Travelnet Pvt. Ltd. Sunirmol Ghosh

Sudesh Behal

Director Director Director Brother of Sunirmol Ghosh

Wife of Sunirmol Ghosh Group Company

Associate Concern Proprietor is wife of Sunirmol Ghosh

24.75

0.72

0.72

8.25

5.00

5.00

100.00

12.00

12.00

-

-

12.00

-

-

0.48

-

18.00

18.00

8.57

4.80

0.78

0.78

9.00

-

-

-

-

-

12.00

4.80

0.78

0.78

-

-

-

-

-

12.00

12.00

12.00

4.80

0.78

0.78

-

-

-

-

-

-

12.00

12.00

-

0.78

0.78

-

-

-

-

-

-

12.00

12.00

12.00

-

0.78

0.78

-

-

-

-

0.39

Salary (w.e.f. 01.02.06)

Surojeet Ghosh

Brother of Sunirmol Ghosh

0.55 - - -

116

Detail of Outstanding balance of Related Parties:

Financial

year ended YEAR ENDED Particular Name of the

enterprise Nature of relationship

28.02.06 31.03.05 31.03.04 31.03.03 31.03.02 31.03.01 Purchase of Services Purchase of Air tickets Event Management Purchase of Boarding and Lodging facility Purchase of Boarding and Lodging facility

Group Company

Proprietor is wife of Sunirmol Ghosh

Purchase of Domestic Ticketing Purchase of Ticketing Purchase of Package Tours

Indo Asia International Pvt. Ltd. Signature Eventz Hotel Hatty Heritage Inn Pvt. Ltd.

Carnival Hotel & Resorts Pvt. Ltd. Signature Eventz Signature Eventz

Proprietor is wife of Sunirmol Ghosh Associate Concern Group Company Group Company Proprietor is wife of Sunirmol Ghosh

(0.65)

0.70

-

0.18

0.18

-

0.90

(0.65)

0.70

(4.99)

-

0.24

-

-

(0.65)

-

0.40

2.00

-

-

-

(0.65)

-

7.38

(2.38)

-

-

-

(2.26)

-

8.56

-

-

-

-

-

-

5.97

0.03

-

-

-

Finance Loans & Advances Loans & Advances Loans & Advances Loans &

Hotel Hatty Indo Asia International Pvt. Ltd. Carnival Hotel & Resorts Pvt. Ltd. Transasia Travelnet Pvt.

Associate Concern Group Company Group Company Group

-

54.52

(23.60)

2.29

68.99

53.71

3.60

49.46

85.99

85.99

29.59

(1.69)

51.96

18.91

6.70

53.75

85.99

17.97

6.17

51.79

185.89

8.83

0.28

31.73

117

Advances Loans & Advances

Ltd. Surojeet Ghosh

Company Brother of Sunirmol Ghosh

5.33

5.02

5.02

5.02

5.02

0.02

Expenses Director Remuneration Director Remuneration Director Remuneration Professional Fees (Upto 31.01.2006) Rent Rent Rent Security Deposit Security Deposit Lease Deposit Commission Salary (w.e.f. 01.02.06)

Sunirmol Ghosh Sudesh Behal Gajendra Singh

Transasia Travelnet Pvt. Ltd.

Signature Eventz

-

5.00

-

Surojeet Ghosh Priti Behal Meeta Ghosh

Sunirmol Ghosh Sudesh Behal Hotel Hatty

Surojeet Ghosh

Director Director

Director Brother of Sunirmol Ghosh Wife of Sudesh Behal Wife of Sunirmol Ghosh Group Company Director Director Associate Concern Proprietor is wife of Sunirmol Ghosh Brother of Sunirmol Ghosh

-

-

-

-

-

-

-

5.00

5.00

-

-

-

-

-

-

-

-

-

5.00

5.00

-

-

-

-

-

-

-

-

-

-

5.00

-

-

-

-

-

-

-

-

-

-

5.00

5.00

-

-

-

-

-

-

-

-

-

5.00

5.00

-

-

-

-

-

-

-

-

-

-

5.00

5.00

-

-

-

118

GROUP COMPANIES The following are the brief details of our group companies: 1. Indo Asia International Private Limited Date of Incorporation: February 14, 1997 Registration No.: 55-85132 Registered Office: C-27, Housing Society, South Extension Part-I, New Delhi - 110049 Principle Activity: Tours & Travels operations. Board of Directors: Mr. Sunirmol Ghosh, Mrs. Priti Behal and Mrs. Sunita Panwar Shareholding pattern of the Company as on February 28, 2006 Name of Shareholder No. of Shares % of Shareholding Mrs. Meeta Ghosh 10 0.03 Mrs. Priti Behal 10 0.03 Mrs. Sunita Panwar 10 0.03 M/s Sudesh Behal HUF 10,000 30.30 M/s Sunirmol Ghosh HUF 10,000 30.30 M/s Gajendra Singh Panwar HUF 10,000 30.30

30,030 100 Total The brief audited financials of the company for the past three Financial Years are as follows:

(Rs. in lacs)

Particulars as on March 31 2005 2004 2003Equity Capital 3.00 3.00 3.00Reserves & Surplus 9.58 11.12 - Sales and Other Income 502.58 440.71 418.02Profit/(Loss) after Tax (PAT) 0.70 11.18 (4.01)Book value per Share (Face Value Rs. 10/-) 41.65 46.66 9.30Earning per Share (Rs.) 2.34 37.24 (13.36) There has been no business activities in this Company since December 31, 2005. The Company was primarily engaged in Domestic Tour operation and Ticketing. The business of this company has been shifted to Indo Asia Leisure Services Ltd. as part of Indo Asia group consolidation and business -reorganization. The Equity Shares of the Company are not listed on any stock exchange. There have been no changes in the capital structure of the Company and there have been no amalgamations/takeovers during the past three years.

119

2. Indo Asia Hotels Private Limited

Date of Incorporation: February 24, 2000. Incorporation No.: 55-103951, Registered with the Registrar of Companies, N.C.T. Delhi & Haryana. Registered Office: C-28, Housing Society, South Extension Part-I, New Delhi - 110049 Principle Activity: Constructing & Owning Hotels. No Activity presently. Board of Directors: Mr. Sunirmol Ghosh, Mr. Sudesh Behal, Mr. Gajendra Singh Panwar, Mrs. Marie Lusie Bauer Shareholding pattern of the Company as on February 28, 2006 Name of Shareholder No. of Shares % of Shareholding Mr. Sunirmol Ghosh 35,010 8.75% Mr. Sudesh Behal 35,010 8.75% Mr. Gajendra Singh Panwar 35,010 8.75% M/s Sunirmol Ghosh HUF 65,000 16.25% M/s Sudesh Behal HUF 65,000 16.25% M/s Gajendra Singh Panwar HUF 65,000 16.25% Mrs. Marie Lusie Bauer 1,00,000 25.00% Total 4,00,030 100% The brief audited financials of the company for the past three Financial Years are as follows:

(Rs. in lacs)

Particulars as on March 31 2005 2004 2003Equity Capital 40.00 40.00 40.00

- - - -

Profit/(Loss) after Tax (PAT) - - -Book Value per share (Face Value Rs. 10/-) 8.95 8.90 8.84Earning Per Share - - -

Reserves & Surplus -Sales & Other Income -

Note: As on date of filing this Draft Red Herring Prospectus, the company is still under the process of implementing its project and has not carried any business activity during the financial year 2005. The equity shares of the Company are not listed on any stock exchange. There have been no changes in the capital structure of the Company and there have been no amalgamations/takeovers during the past three years.

120

3. Carnival Hotel & Resorts Private Limited Date of Incorporation: February 14, 1997. Incorporation No.: 55- 85131, Registered with the Registrar of Companies, N.C.T., Delhi & Haryana. Registered Office: A-15, Second Floor, Hauz Khas, New Delhi Principle Activity: Providing Marketing and Management Services to Hotels. Board of Directors: Mr. Sunirmol Ghosh, Mr. Sudesh Behal, Mr. Charanjeet Singh Kocchar, Mr. Surender Kumar Nagpal. Shareholding pattern of the Company as on February 28, 2006

Name Of Shareholder No. Of Shares % of Shareholding Mr. Sudesh Behal 100 0.64% Mr. Sunirmol Ghosh 100 0.64% Mr. Gajendra Singh Panwar 100 0.64% M/s Sudesh Behal HUF 5,000 32.01% M/s Sunirmol Ghosh HUF 5,000 32.01% M/s Gajendra Singh Panwar HUF 5,000 32.01% Mr. Surender Kumar Nagpal 150 0.96% Mr. Charanjit Singh Kocchar 150 0.96% Ms. Alka Krishnan 10 0.06% Ms. Sunita Arora 10 0.06% Total 15,620 100.00% The brief audited financials of the company for the past three Financial Years are as follows:

(Rs. in lacs) Particulars as on March 31 2005 2004 2003Equity Capital 1.56 1.56 1.56Reserves & Surplus (8.86) (7.51) (9.10)Sales and Other Income 14.83 14.87 3.38Profit/(Loss) after Tax (PAT) (1.35) 1.59 (2.14)Book value per Share (Face Value Rs.10/-) (47.98) (39.61) (50.02)Earning per Share (Rs.) (8.62) 10.15 (13.68) The equity shares of the Company are not listed on any stock exchange. There have been no changes in the capital structure of the Company and there have been no amalgamations/takeovers during the past three years.

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4. Transasia Travelnet Private Limited Date of Incorporation: August 29, 1996. Incorporation No.: 55-81497, Registered with the Registrar of Companies, N.C.T. Delhi & Haryana. Registered Office: C-28, Housing Society, South Extension Part - 1, New Delhi - 110 049 Principle Activity: Tour Operation and Travel Related Activities. Board of Directors: Mrs. Priti Behal, Mrs. Meeta Ghosh and Mrs. Sunita Panwar Shareholding pattern of the Company as on February 28, 2006

Name Of Shareholder No. of Shares % of Shareholding

7,500 49.00% M/s Sunirmol Ghosh HUF 7,500 49.00% Mrs. Priti Behal 101 0.67% Mrs. Meeta Ghosh 101 0.67% Mrs. Sunita Panwar 101 0.67% Total 15,303 100.00%

M/s Sudesh Behal HUF

The brief audited financials of the company for the past three Financial Years are as follows:

(Rs. in lacs) Particulars as on March 31 2005 2004 2003Equity Share Capital 1.53 1.53 1.53Reserves & Surplus 16.85 10.05 8.92Sales and Other Income 10.08 2.15 3.58Profit/(Loss) after Tax (PAT) 7.17 1.13 0.52Book value per Share (Face Value Rs.10/-) 119.88 75.13 67.49

46.83 7.39 3.41Earning per Share (Rs.) The equity shares of the Company are not listed on any stock exchange. There have been no changes in the capital structure of the Company and there have been no amalgamations/takeovers during the past three years.

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5. Holliday Mall.Com Private Limited Date of Incorporation: April 24, 2001. Incorporation No.: U2220DL2001PTC110547, Registered with the Registrar of Companies, N.C.T., Delhi & Haryana. Registered Office: C-27, Housing Society, South extension Part- 1, New Delhi- 110 049 Principle Activity: To provide Tourism and internet Services in India and abroad. Board of Directors: Mr. Sunirmol Ghosh, Mr. Sudesh Behal, Mr. Gajendra Singh Panwar Shareholding pattern of the Company as on February 28, 2006

Name Of Shareholder No. Of Shares % of Shareholding Mr. Sudesh Behal 5,000 33.33%

33.33% Mr. Gajendra Singh Panwar 5,000 33.33% Total 15,000 100.00%

Mr. Sunirmol Ghosh 5,000

The brief audited financials of the company for the past three Financial Years are as follows:

(Rs. in lacs) Particulars as on March 31 2005 2004 2003Equity Share Capital 1.50 1.50 1.50Reserves & Surplus - - -Sales and Other Income -

- - -Book value per Share (Face Value Rs.10/-) 2.97 3.49 3.93Earning per Share (Rs.) - - -

- -Profit/(Loss) after Tax (PAT)

*The Company has not carried out any business activity since inception. The equity shares of the Company are not listed on any stock exchange. There have been no changes in the capital structure of the Company and there have been no amalgamations/takeovers during the past three years.

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6. Indo Asia Tours & Travels Private Limited Date of Incorporation: February 24, 2000.

Board of Directors: Mr. Sunirmol Ghosh, Mr. Sudesh Behal, Mr. Gajendra Singh Panwar

Incorporation No.: 55-103964, Registered with the Registrar of Companies, N.C.T., Delhi & Haryana. Registered Office: C-28, Housing Society, South Extension Part- 1, New Delhi- 110 049 Principle Activity: Providing Tours and Travel services.

Shareholding pattern of the Company as on February 28, 2006

Name Of Shareholder No. Of Shares % of Shareholding Mr. Sudesh Behal 5,010 33.33% Mr. Sunirmol Ghosh 5,010 33.33% Mr. Gajendra Singh Panwar 5,010 33.33% Total 15,030 100.00% The brief audited financials of the company for the past three Financial Years are as follows:

(Rs. in lacs) Particulars as on March 31 2005 2004 2003Equity Share Capital 1.50 1.50 1.50Reserves & Surplus - - -Sales and Other Income - - -Profit/(Loss) after Tax (PAT) - - -Book value per Share (Face Value Rs.10/-) 5.42 6.33 6.87Earning per Share (Rs.) - - -*The Company has not carried out any business activity since inception. The equity shares of the Company are not listed on any stock exchange. There have been no changes in the capital structure of the Company and there have been no amalgamations/takeovers during the past three years.

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7. Coorg Hotels Private Limited Date of Incorporation: September 13, 2002. Incorporation No.:U55101DL2002PTC116972, Registered with the Registrar of Companies, N.C.T., Delhi & Haryana. Registered Office: C-28, Housing Society, South extension Part- 1, New Delhi- 110 049 Principle Activity: Carrying on the business of establishing and running hotels, motels resorts etc. Board of Directors: Mr. Sunirmol Ghosh, Mr. Sudesh Behal and Mr. M.D. Muthappa Shareholding pattern of the Company as on February 28, 2006

Name of Shareholder No. of Shares % of Shareholding Mr. Sudesh Behal 4,000 40.00% Mr. Sunirmol Ghosh 4,000 40.00% Mr. M.D. Muthappa 2,000 20.00% Total 10,000 100.00% The brief audited financials of the company for the past three Financial Years are as follows:

(Rs. in lacs) Particulars as on March 31 2005 2004 2003 Equity Share Capital 1.00 1.00 1.00 Reserves & Surplus - - - Sales and Other Income - - - Profit/(Loss) after Tax (PAT) - - - Book value per Share (Face Value Rs.10/-) 1.15 1.20 1.25 Earning per Share (Rs.) - - - *The Company has not carried out any business activity since inception. The equity shares of the Company are not listed on any stock exchange. There have been no changes in the capital structure of the Company and there have been no amalgamations/takeovers during the past three years.

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8. Heritage Inn Private Limited

Incorporation No.: 17- 06057 Registered with the Registrar of Companies, Rajasthan, Jaipur

Principle Activity: Carrying on the business of establishing and running hotels, motels resorts etc. Board of Directors: Mr. Sunirmol Ghosh, Mr. Sudesh Behal, Mr. Radhey K. Gupta, Mr. Charanjit Singh Kochar & Mr. S. K. Nagpal

Shareholding pattern of the Company as on February 28, 2006

Name Of Shareholder

Date of Incorporation: June 26, 1991.

. Registered Office: Nagpal Tyres, Chandi ki Taksal, Jaipur, Rajasthan

No. of Shares % of Shareholding

Mr. Sudesh Behal 3,300 6.11% Mr. Sunirmol Ghosh 3,400 6.30% Mr. Radhey K. Gupta 3,400 6.30%

13,500 25.00% Mr. S.K. Nagpal 13,500 25.00% Transasia Travelnet Private Limited 6.30% Indo Asia Leisure Services Limited 13,500 25.00% Total 54,000 The brief audited financials of the company for the past three Financial Years are as follows:

(Rs. in Lacs)

Particulars as on March 31 2005 2004 Equity Share Capital 54.00 54.00 54.00Reserves & Surplus 27.05 (1.88)Sales and Other Income 186.89 132.09 70.31Profit/(Loss) after Tax (PAT) 5.36 (31.80)Book value per Share (Face Value Rs.100/-) 150.09 106.44 96.51

43.65 9.92 (58.90) The equity shares of the Company are not listed on any stock exchange. There have been no changes in the capital structure of the Company and there have been no amalgamations/takeovers during the past three years. None of our group companies have been declared as a sick company within the meaning of the Sick Industrial Companies (Special Provisions) Act, 1995.

Mr. Charanjit Singh Kochar

3,400

100.00%

2003

3.48

23.57

Earning per Share (Rs.)

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9. Hotel Hatty (Partnership firm) Date of Formation: July 08, 1982 Registered Office: C-27, South Extension Part-I, New Delhi- 110 049 Principle Activity: Hotel business Name of Partners: Mr. Sunirmol Ghosh and Mr. Sudesh Behal

Shareholding pattern of the firm as on February 28, 2006

Name of Shareholder Sharing of Partnership Mr. Sunirmol Ghosh 50% Mr. Sudesh Behal 50%

The brief audited financials of the company for the past three Financial Years are as follows:

(Rs. in lacs) Particulars as on March 31 2005 2004 2003 Partners’ Capital 24.00 26.00 26.00

--- --- Sales and Other Income 129.27 115.51 Profit/(Loss) after Tax (PAT) 24.75 17.94 (3.46)

For details on litigations and disputes pending against our group companies and defaults made, please refer to the section titled ‘Outstanding Litigations’ beginning from page no. 142 of this Draft Red Herring Prospectus. DISSOCIATION Our promoters have not disassociated themselves from any of the Companies/firms during the last three years:

Reserves & Surplus --- 81.53

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATION You should read the following discussion and analysis of our financial condition and results of operations together with our restated financial statements of each of the fiscal years ended March 31, 2001, 2002, 2003, 2004, 2005 and for the 11 month period ended February 28, 2006, including the notes thereto and the reports thereon in the section titled ‘Financial Statements’ beginning on page 87 of this Draft Red Herring Prospectus. You should also read the section titled ‘Risk Factors’ beginning on page ix of this Draft Red Herring Prospectus, which discusses a number of factors and contingencies that could impact our financial condition and result of operations. 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 the SEBI guidelines. Our fiscal year ends on March 31 of each year so all references to a particular fiscal year are to the twelve months ended March 31 of that year. The audited financial results for the eleven (11) months ended on February 28, 2006 have also been stated alongside. OVERVIEW OF THE BUSINESS OF OUR COMPANY

We generally operate group tours with fixed departures and fixed itinerary. However, as per the requirement of a client we also sell tailor made tour packages having itinerary according to the client requirement. We regularly take feed back from our clients about their experience of travelling with us and accordingly update/improve our services. We have the business tie-ups with some of the leading tour operators in the world such as GeBeCo, Djoser, Jeo Far Reisen, Insight Reisen etc. These we have been able to retain just because of our value added services and competitive rates. Our strength lies in vast experience of our core team, who have extensive background of the hospitality industry. Our work force is about 138 personnel, including our 3 wholetime director, who have vast and diversified experience in their respective field of operation. Team. After joining our group no one from the core team has left the organization.

We are primarily into the business of Tour operations. We have been providing travel and tour services to the Inbound tourists visiting India for the last 18 years. During the last 4 to 5 years, we have expanded our operations to outbound and domestic tour operations. Further, we have also forayed into the hotel business by setting up a 3 star hotel facility at Bikaner (Rajasthan). We are having our own ticketing division and a fleet of luxury transport coaches to support the logistics of our core business of tour operation. We work towards providing a complete holiday solution to our clients at a good value for money. We are continuously in search of new getaways, destinations, intellectual resources and logistical solutions, and continual improvements in our operations to make our customers delighted.

Our company have received various awards from department of tourism, government of India, for excellence in tourism, latest being Third position in First category for 2001-02 and Second position in second category for the year 2003-04. We have also obtained ISO 9001:2000 certificate for Quality Management which reflects our commitment to strong quality systems and compliance to international standards.

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FACTORS AFFECTING OUR RESULTS OF OPERATIONS Our financial condition and results are affected by numerous factors including the following: General Economic and Business Conditions The performance of our Company is dependent upon national and global growth. India’s GDP growth rate of 6.9% in the fiscal 2004-05 (Source: Central Statistical Organisation; Ministry of Statistics and Program Implementation), one of the highest in the world, has been marked by continuous economic reforms, deregulation of the economy, a healthy capital market, robust industrial and agricultural growth as well as increased foreign investment in the country. This growth momentum has been very optimistic for the first half of 2005-06 with the GDP growth at 8.1% compared to the corresponding 7.5% for the corresponding first quarter of fiscal 2005(Source: Central Statistical Organisation; Ministry of Statistics and Program Implementation). Today people looks at India as fast developing economy. With the increase in the income levels, the modern indian metro citizen is adopting the habit of travelling for leisure purpose not just with in India but also overseas. Competition

Our Obligation towards our Principal Agent

We operate through a network of agents spread across the globe. We arrange for travel, accommodation, sightseeing etc. for the clients booking through these agents. We have a obligation towards our principal agent to safeguard their business interest. Any sub-performance/non-performance on our part could result into high retentions and refunds, which may affect the profitability of our company. Thus proper monitoring of execution of our business obligation, maintenance of backup support in case of any breakdown in the system etc. becomes important.

The demand for our services depends upon the overall economic growth and government initiative in promoting tourism. The last few years has seen a steady growth in the tourism sector in India. The government has taken initiative in promoting India as a tourist destination.

Our company is in direct competition with other tour operators like Cox-n-kings, Sita-Kuoni World Travel, Creative Travel, Travel Corporation of India, La-Passage to India etc. With our vast experience and capabilities to retain our customers due to our personalized services and competitive prices, and providing the complete holiday solution under a single roof, the management is confident to sustain any pressure from our direct competitors. Other Factor Our company is in the tourism business, where there is direct interaction with the end user client. Our business requires us to provide personalized services to each individual client. The client’s need depends on various factors such as their age group, the socio-economic condition of their respective country, their religion, their interest, their profession, climate of their country etc. Our management is widely traveled across the world which helps us in regularly updating ourselves on the various socio economic conditions in each region. This helps us in providing quality and satisfactory services to our clients.

Demand

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Results of Operations Income Our Income consists mainly of Income from proving tour & travel services to foreign Inbound tourists visiting India, domestic tourists travelling within India and Indian Outbound tourists travelling abroad. It also includes income from Hotel Sales. We have been providing services to the Inbound tourists for the last 18 years and recently in January 2005 we have commenced Outbound and domestic tour services in our company. Expenses

Transportation Transportation includes the cost we incur in running and maintenance of our fleet of vehicles, Road Tax and state toll taxes and charges paid to other transporters for the transportation services they provide to us. Our coaches are well maintained and we follow our maintenance schedule very strictly. This ensures our vehicle running cost at the minimum. Since, we also take services of other transporters, we normally enters into rate agreements for a calendar year with all the transporters on our panel. This minimizes the risk of fluctuation in the transportation rates during any given period. Transportation expenses as a percentage to total expenses was 9% as per the audited accounts for the 11 month period ended 28 uary, 2006.

Our expenses mainly consist of Operating Expenses like hotel expenses, transportation, Air ticketing, Tour Leader/guiding expenses & entrances etc., personnel expenses, interest and financial charges and depreciation in addition to our normal overheads, the detail of which are given below.

Hotel Expenses

The hotel expenses includes boarding and lodging facilities for our clients. This is the major expense in our industry and critically affect the margins of the company. We normally get the rates from the hoteliers in advance for a calendar year, on the basis of which we formulate the cost of our itinerary. Thus the chances of fluctuation in the hotel rates are bare minimum. Hotel Boarding & Lodging as a percentage to total expenses was 44% as per the audited accounts for the 11 month period ended 28th February, 2006.

th Febr

Air Ticketing

As an inbound tour operator, we do the ground handling of our clients from the date of their arrival into India till the date of their departure from India. Thus our itinerary includes air travel within India and its neighboring countries. Normally all the airlines fix their rates in advance for a season. On the basis of those rates we quote our charges for the itinerary. As a domestic and outbound tour operator we also do the ticketing of our clients for their tours with in India as well as abroad. With rates made available by the airlines in advance, we formulate our cost for an itinerary.

Air Ticketing expenses as a percentage to total expenses was 23.59 % as per the audited accounts for the 11 month period ended 28 February, 2006. th

Guiding

Other operational cost includes guiding charges, monument entrances fees etc. Guiding is one of the crucial services since Tour Leader/Guide is the person who directly interacts with the client during their tour. Any mistake by the tour leader can result in loss of future business opportunity. Taking into consideration the severity of services, our

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company selects the tour leaders very carefully after taking into account their personal appearance, their qualification, their knowledge and most importantly their command over the language and their presentation skills. To enhance their abilities, our company organize tour escorts training programmed from time to time. As a part of tour cost, our company also pay monument entrances fees (as applicable) to be paid at the time of entering into a particular monument. Since the entrances fees is also fixed and does not fluctuate very often, our company is able to cover the cost while formulating the cost of a particular package tour.

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Depreciation

Our depreciation expenses mainly consist of depreciation on our coaches, plant & machinery installed at our hotel, hotel building, computers, cars and other fixed assets. Our company follows straight line method of depreciation and the depreciation expenses as a percentage to total expenses was 2.17% as per the audited accounts for the 11 month period ended 28th February, 2006.

Administrative and other expenses consist of travelling (domestic and international), Business Promotion, communication, personnel expenses, Directors Remuneration, Vehicle Running & Maintenance, Insurance, Printing & stationery etc. Administrative and other expenses as a percentage to total expenses was 8.18% as per the audited accounts for the 11-month period ended 28th February 2006.

Interest and Finance charges represent expenses incurred in respect of our Term Loan taken from Tourism Finance Corporation of India Limited (TFCI) and other Bank charges paid by our company during the normal course of our business operations. The rate of interest payable on term loan is 12%, out of which our company is entitle to get 5% interest subsidy from the Department of Tourism, Government of India. Interest & Finance Charges as a percentage to total expenses stood at 0.50% for the 11 month period ended 28 February, 2006. Taxation

We availed benefits of MAT under Indian taxation laws in the year 2002-03. MAT involves the payment of tax on a company’s book profits in the event that the tax payable in accordance with the tax law is less than a certain limit. A depreciation tax shield would be available in respect of fixed assets acquired by our company in future as per applicable tax rates prevailing at the time. The following table sets forth certain information with respect to our financial and operational data for the financial information with common size statement in percentage for the financial year ended March 31, 2002, 2003, 2004, 2005 and for the period ended February 28, 2006.

Interest and Financial Charges

Provision of Income tax (excluding provision for deferred tax) is based upon the established tax computation for the fiscal year 2005-06 and any excess or shortfall will be accounted on completion of assessment.

Guiding and Monument entrances fees as a percentage to total expenses was 3.50% as per the audited accounts for the 11 month period ended 28 February, 2006.

Administrative and other Expenses

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(Rs. In lacs) Financial Year ended 31.03.2003 31.03.2005 31.03.2004 31.03.2002 Amount % Amount % Amount % Amount % Income

3,258.86 95.82 94.72 1,002.77 92.82 1,867.88 Hotel Sales 126.86 3.73 108.13 5.05 69.47 6.43 70.51Other Income 15.37 0.45 4.85 0.23 8.07 0.75 6.36Total Income (A)

Tour Receipts 2,027.52

Expenditure

35.46 1.05 30.52 15.99 1.49 0.85Tour Expenses 2,460.05 72.66 1,516.94 71.03 702.4 65.51 1,361.62 70.24Salaries, Wages and Benefits 111.64 3.30 77.43 3.63 64.87 6.05 76.78 3.96Directors Remuneration 44.57 1.32 36 1.69 36 3.36 36 1.86Administration and other Expenses 344.87 10.19 231.43 10.84 124.7 11.63 222.96 11.50Selling & Distribution Exp. 57.74 1.71 42.87 2.01 8.15 0.76 24.78 1.28Depreciation 70.68 2.09 56.37 2.64 56.24 5.25 69.96 3.61Interest & Financial Charges 30.1 27.51 21.86 0.89 1.29 2.04 30.09 1.55Total Expenditure (B) Net Profit before Tax and Extraordinary Items (A-B)

245.98 7.23 121.43 5.67 50.10 4.64 106.11 5.46

Current Tax 80.50 2.37 17.00 0.79 3.00 0.28 7.88 0.41Deferred Tax 10.93 0.32 1.28 5.46 0.26 13.84 -Net Profit before Extraordinary Items 154.55 4.54 98.97 4.62 33.26 3.08 98.23

(15.22) (13.79) 5.31 (2.39)Net Profit after Extraordinary Items 139.33 4.10 85.18 3.98 38.57 3.57 95.84 4.93

*Expenditure % has been calculated as a percentage of Total Income excluding Other Income. All other % has been computed as a % of Total Income. COMPARISON OF 11 MONTH PERIOD ENDED FEBRUARY 28, 2006 WITH FISCAL YEAR 2005 Tour Receipt

The receipt from tours were Rs. 4077.24 Lacs for the period ended February 28, 2006 (11 months) as against Rs. 3258.86 Lacs for the year ended March 31, 2006. The Tour receipt mainly comprise of receipt from Inbound tour operation comprising about 73% of the total tour receipt. Outbound and Domestic tour operation constitute 23% of the total tour receipt. As compared to the year 2004-05, the tour receipt from Domestic & Outbound tour operations has increased tremendously. While Outbound and domestic tour operation constitute about 4.20% of the total Tour receipt in the year 2004-05, it has grown upto 23% of the tour receipt in the 11 month ended February 28, 2006. Sales

Sales which is the receipt from hotel operations, were Rs. 141.76 Lacs for the period ended February 28 2006 (11 months) as against Rs. 126.86 Lacs for the year ended March 31, 2006. The increase is due to the growth in the inbound tourism as well as domestic tourism.

,

Other Income

Material consumed 16.471.43

5.05Extraordinary Items

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Other income decreased from Rs. 15.37 Lacs in the financial year 2004-05 to Rs. 11.28 Lacs for the period ended February 28, 2006 (11 months). Other income of our company is normally derived from our investments in various mutual fund schemes. The decrease in the other income is due to the fact that various investments were redeemed by our company to fulfill the requirement of funds for construction of corporate office at Gurgaon. Operating Expenses Our operating expenses, which includes Tour expenses and material consumed, as a percentage of Total Income (excluding other income) has increased from 73.71% in the fiscal year 2005 to 74.82% for the 11 months ended on February 28, 2006. The increase in the direct cost is due to increase in the hotel expenses and reduction in the commission paid by the Airlines. Salary Salary, Wages and other benefits to the employees, including directors remuneration, as a percentage of Total Income (excluding other income) has increased from 4.61% in the fiscal year 2005 to 5.80% for the 11 month period ended February 28, 2006. This is mainly due to new recruitment for expanding the operations of the Outbound and domestic tour operation division of our company. Administrative and other Expenses As a percentage of Total Income (excluding other Income) our Administrative Expenses decreased from 10.19% in the fiscal year 2005 to 7.48% for the 11 month period ended February 28, 2006. This decrease is due to increase in the Tour receipt and further due to effective utilization of resources and cost cutting measure taken by our company. Selling & Distribution Expenses As a percentage of Total Income (excluding other Income) our Selling & Distribution expenses decreased from 1.71% in the fiscal year 2005 to 1.01% for the 11 month period ended February 28, 2006. This decrease is partly due to increase in Tour receipts and further due to reduction in length of overseas business trips.

Net Profit before Tax

Interest & Financial Charges As percentage of Total Income (excluding other Income) our Interest & Financial Expenses decreased from 0.89% in the fiscal year 2005 to 0.45% for the 11 month period ended February 28, 2006. This decrease is because of the fact that the company has not taken any new loan during the 11 months ended February 28, 2006 and the decrease in the principle outstanding of the present secured loans. Depreciation

As percentage of Total Income (excluding other Income) our depreciation cost has decreased from 2.09% in the fiscal year 2005 to 1.99% for the 11 month period ended February 28, 2006. This decrease is because of the fact that during the during the 11 months ended February 28, 2006 there was not much capital investment made by our company and on the other side the tour receipt has increased substantially.

Net profit before tax is Rs. 380 Lacs for the period ended February 28, 2006 (11 months) as against Rs. 230.76 Lacs for the fiscal year 2005. The net profit Margins of our company have gone up due to increase in Business revenues as compared to the Operating, Administrative Expenses and Selling & Distribution expenses. Review of Financial Position

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Non-current liabilities consist of long term secured loans, long term unsecured loans and deferred tax liabilities. Non-current liabilities have decreased from Rs. 407.05 Lacs as on March 31, 2005 to Rs. 363.45 Lacs as on 11 month ending February 28, 2006. The decrease is mainly attributable to repayments of principal amount of Rs. 57.38 Lacs on long term secured loans during the 11 months ending February 28, 2006.

Fixed Assets Fixed Assets Comprising of Coaches, Hotel Building, Plant & Machinery installed at Hotel, Cars (Private Vehicles), office equipments, computers, furniture and capital work in progress. The net fixed assets increased by Rs. 113.04 Lacs, i.e. 10.41%, from Rs. 1,085.83 Lacs as of March, 31, 2005 to Rs. 1,198.87 Lacs as on February 28, 2006. During this period, there were additions of fixed assets of Rs. 99.10 Lacs out of which Rs. 55.65 Lacs was invested in new coaches and Rs. 26.07 Lacs in new cars. Capital work in progress on account of construction of corporate office at Gurgaon has increased by Rs. 92.11 Lacs. Investments

The investment of our company was reduced from Rs. 97.43 Lacs in the fiscal year 2005 to Rs. 19.00 Lacs during the period ending February 28, 2006. In the fiscal year 2005 our company invested in Mutual Funds to the tune of Rs. 78 Lacs, which was redeemed during the 11 months ending February 28, 2006 to finance the requirement of funds for the construction of our corporate office. Out of the present investment Rs. 18.00 Lacs comprise of unquoted 2,300 equity shares in Heritage Inn Pvt. Ltd. and balance Re. 1 Lacs in IDBI infrastructure bonds. Current Assets Current Assets includes Sundry Debtors, Inventory, Cash & bank Balances, Security Deposits and other Loans & Advances recoverable in Cash or in Kind. Current assets have increased in line with the growth of our business activity.

During the period under consideration current assets increased by Rs. 335.17 from Rs. 1,401.97 Lacs as on March 31 2005 to Rs. 1,737.14 Lacs as on February 28 2006. This increase is primarily due to the increase in Sundry Debtors and Loans & Advances inline with the increase in business operations.

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Sundry Debtors accounted for 64.32% of the total current assets as on February 28, 2006. Debtors increased from Rs. 760.83 Lacs as on March 31, 2005 to Rs. 1,117.40 Lacs as on February 28, 2006. Debtor’s turnover has increase from 82 days to 96 days during the period under consideration. Cash and Bank Balances accounted for 5.32% of the total current assets as on February 28, 2006. Loans and advances accounted for 30.30% of total current assets as on February 28, 2006. Loans and advances have decreased slightly from Rs. 553.27 as on March 31, 2006 to Rs. 526.30 Lacs as on 11 months ended February 28, 2006. The major portion of Loans and advances comprises of Advances given to Hotels for holding rooms and security deposits. Current Liabilities and Provisions Current Liabilities include Sundry Creditors, expenses payable, Duties and taxes payable and provision for income tax.

During the period under consideration current liabilities increased by Rs. 79.33 Lacs from Rs. 652.08 Lacs as on March 31 2005 to Rs. 847.89 Lacs as on February 28 2006. This increase is primarily due to increase in business operation.

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Non Current Liabilities

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Net Worth

Other Income

Salary, Wages and other benefits to the employees, including directors remuneration, as a percentage of Total Income (excluding other income) has decreased from 5.31% in the fiscal year 2004 to 4.61% for the year ended March 31, 2005. The decrease in the Salary as a percentage of Total Income is due to increase in the Tour Receipts during the period under consideration.

Administrative and other Expenses As a percentage of Total Income (excluding other Income) our Administrative Expenses decreased from 10.84% in the fiscal year 2004 to 10.19% for the fiscal year 2005. This decrease is because of the increase in the Tour receipt and effective utilization of resources and the cost cutting measure taken by our company.

Net worth of our company has increased by Rs. 217.58 Lacs from Rs. 1,526.09 Lacs as on March 31, 2005 to Rs. 1,743.67 Lacs as on the 11 month ending February 28, 2006 on account of improved profitability. COMPARISON OF FISCAL YEAR 2005 TO FISCAL YEAR 2004 Tour Receipt

The receipt from tours were Rs. 3,258.86 Lacs for fiscal year ended March, 2005 as against Rs. 2,027.52 Lacs for the year ended March 31, 2004. The Tour receipt mainly comprise of receipt from Inbound tour operation comprising about 92.05% of the total tour receipt. Outbound and Domestic tour operation constitute 4.20% of the total tour receipt, since the company started outbound and domestic tour operation business w.e.f. January 1, 2005 only. The increase in the tour receipt is due to the revival of Inbound tour operation business in India.

Sales Sales, which is the receipt from hotel operations were Rs. 126.86 Lacs for the year ended March 31, 2005 as against Rs. 108.13 Lacs for the year ended March 31, 2004. The increase is due to the growth in the inbound tourism as well as domestic tourism.

Other income increased from Rs. 4.85 Lacs in the financial year 2003-04 to Rs. 15.37 Lacs for the year ended March 31, 2005. Other income of our company is normally derived from our investments in various mutual fund schemes. The increase in the other income attributes to the increase in the Investment and growth in the Capital Market.

Operating Expenses Our operating expenses, which includes Tour expenses and material consumed, as a percentage of Total Income (excluding other income) has increased from 72.46% in the fiscal year 2004 to 73.71% in the fiscal year 2005. The increase in the operating cost is due to increase in the hotel expenses. Salary

Selling & Distribution Expenses

As a percentage of Total Income (excluding other Income) our Selling & Distribution expenses decreased from 2.01% in the fiscal year 2004 to 1.71% for the fiscal year 2005. This decrease is because of the increase in the Tour receipt and further due to reduction in the overseas marketing trips.

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Interest & Financial Charges As percentage of Total Income (excluding other Income) our Interest & Financial Expenses decreased from 1.29% in the fiscal year 2004 to 0.89% for the fiscal year 2005. This decrease is due to ever decreasing principal outstanding of TFCI term loan. Depreciation As percentage of Total Income (excluding other Income) our depreciation cost has decreased from 2.64% in the fiscal year 2004 to 2.09% for the fiscal year 2005. This decrease is because of the fact that during the period under consideration there was not much capital investment made by our company and on the other side the tour receipt has increased substantially. Net Profit before Tax Net profit before tax is Rs. 230.76 Lacs for the fiscal year 2005 as against Rs. 107.64 Lacs for the fiscal year 2004. The net profit Margins of our company have gone up due to increase in the Business operations as compared with Administrative Expenses and Selling & Distribution Cost. Review of Financial Position Fixed Assets Fixed Assets Comprising of Coaches, Hotel Building, Plant & Machinery installed at Hotel, Cars (Private Vehicles), office equipments, computers, furniture and capital work in progress. The net fixed assets increased by Rs. 116.85 Lacs, i.e. 12.06%, from Rs. 968.98 Lacs as of March, 31, 2004 to Rs. 1,085.83 Lacs as on March 31, 2005. During this period, there were net additions of fixed assets of Rs. 158.49 Lacs out of major investment was for Rs. 107.46 Lacs in new coaches and Rs. 15.03 Lacs in new cars. Investments The investment of our company was increased from Rs. 21.50 Lacs to Rs. 97.43 Lacs in the fiscal year 2005. Investment was in Mutual Funds. Current Assets Current Assets includes Sundry Debtors, Inventory, Cash & bank Balances, Security Deposits and other Loans & Advances recoverable in Cash or in Kind. Current assets have increased in line with the growth of our business activity. During the period under consideration current assets increased by Rs. 157.21 Lacs over the previous year. Sundry Debtors accounted for 54.27% of the total current assets as on March 31, 2005. Debtors increased from Rs. 524.66 Lacs as on March 31, 2004 to Rs. 760.83 Lacs as on March 31, 2005. Debtor’s turnover has reduced from 82 days to 89 days during the period under consideration (based on 365 days working). Cash and Bank Balances accounted for 6.20% of the total current assets as on March 31, 2005. Loans and advances accounted for 39.46% of total current assets as on March 31, 2005. Loans and advances have decreased slightly from Rs. 643.65 Lacs as on March 31, 2004 to Rs. 553.27 Lacs as on March 31, 2005. The major portion of Loans and advances comprises of Advances given to Hotels for holding rooms and security deposits.

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Current Liabilities and Provisions

Net worth of our company has increased by Rs. 213.45 Lacs from Rs. 1,312.64 Lacs as on March 31, 2004 to Rs. 1,526.09 Lacs as on March 31, 2005.

Current Liabilities include Sundry Creditors, expenses payable, Duties and taxes payable and provision for income tax.

During the period under consideration current liabilities increased by Rs. 190.35 Lacs i.e. from Rs. 461.73 Lacs as on March 31 2004 to Rs. 652.08 Lacs as on March 31, 2005. This increase is primarily due to increase in business operation.

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Non Current Liabilities Non-current liabilities consist of long term secured loans, long term unsecured loans and deferred tax liabilities. Non-current liabilities have decreased by Rs. 53.81 Lacs i.e. from Rs. 460.86 Lacs as on March 31, 2004 to Rs. 407.05 Lacs as on March 31, 2005. The decrease is mainly attributable to repayments loans amounting to Rs. 64.75 Lacs. Net Worth

COMPARISON OF FISCAL YEAR 2004 TO FISCAL YEAR 2003 Tour Receipt The receipt from tours were Rs. 2,027.52 Lacs for the period ended March 31, 2004 as against Rs. 1,002.77 Lacs for the year ended March 31, 2003. The company registered a growth of above 100% over the previous year mainly due to a better operations in Inbound tourism. Sales Sales which is the receipt from hotel operations, were Rs. 108.13 for the period ended March 31, 2004 as against Rs. 69.48 for the year ended March 31, 2003. The company registered a growth of around 63% over the previous year due to better occupancy in our hotel. Other Income Other income decreased from Rs. 8.07 Lacs in the financial year 2002-03 to Rs. 4.85 Lacs for the year ended March 31, 2004. The marginal decrease is due to less receipt of interest on FDR’s.

Operating Expenses

Our operating expenses, which includes Tour expenses and material consumed, as a percentage of Total Income (excluding other income) has increased from 67% in the fiscal year 2002-03 to 72.46% in the fiscal year 2003-04. The increase in the direct cost is due to increase in the hotel tariffs across India. Salary Salary, Wages and other benefits to the employees, including directors remuneration, as a percentage of Total Income (excluding other income) has decreased from 9.41% in the fiscal year 2002-03 to 5.31% in the fiscal year 2003-04. This decrease is because of almost 100% increase in the Tour receipt. Therefore our company could take benefit of economies of scales.

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Administrative and other Expenses

Fixed Assets Comprising of Coaches, Hotel Building, Plant & Machinery installed at Hotel, Cars (Private Vehicles), office equipments, computers, furniture and capital work in progress. The net fixed assets increased by Rs. 151.26 Lacs, i.e. 18.50%, from Rs. 817.72 Lacs as on March, 31, 2003 to Rs. 968.98 Lacs as on March 31, 2004 mainly due to purchase of new coaches, cars & other office equipments.

The investment of our company was reduced from Rs. 103.50 Lacs in the fiscal year 2002-03 to Rs. 21.50 Lacs in the fiscal year 2003-04. The decrease is due to the redemption of units of Mutual Funds to the tune of Rs. 100.00 Lacs. During the period under review the company invested in the unquoted shares of Heritage Inn Pvt. Ltd. to the tune of Rs. 18.00 Lacs.

Current Assets

As a percentage of Total Income (excluding other Income) our Administrative Expenses decreased from 11.63% in the fiscal year 2002-03 to 10.84% in the fiscal year 2003-04. This decrease is because of the effective utilization of the existing infrastructure of the company Selling & Distribution Expenses As a percentage of Total Income (excluding other Income) our Selling & Distribution expenses increased from 0.76% in the fiscal year 2002-03 to 2.01% in the fiscal year 2003-04. This increase is because of the increase in marketing cost and commissions paid for procuring business. Interest & Financial Charges As percentage of Total Income (excluding other Income) our Interest & Financial Expenses decreased from 2.04% in the fiscal year 2002-03 to 1.29% in the fiscal year 2003-04. This decrease is due to decrease in outstanding loans. Depreciation

Net Profit before Tax Net profit before tax is Rs. 107.64 Lacs in the fiscal year 2003-04 as against Rs. 55.41 Lacs in the fiscal year 2002-03. The company has registered a growth of 100% over previous year due to increase in total income, decrease in personal expenses and other overheads.

Review of Financial Position Fixed Assets

Investments

Current Assets includes Sundry Debtors, Inventory, Cash & bank Balances, Security Deposits and other Loans & Advances recoverable in Cash or in Kind. Current assets have increased in line with the growth of our business activity.

As percentage of Total Income (excluding other Income) our depreciation cost has decreased from 5.25% in the fiscal year 2002-03 to 2.64% in the fiscal year 2003-04.

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During the period under consideration current assets increased by Rs. 166.39 from Rs. 1,078.37 Lacs as on March 31 2003 to Rs. 1,244.76 Lacs as on March 31 2004. This increase is primarily due to the increase in Sundry Debtors and Cash and Bank Balances.

st st

Sundry Debtors accounted for 42.15% of the total current assets as on March 31, 2004. Debtors increased from Rs. 348.91 Lacs as on March 31, 2003 to Rs. 524.66 Lacs as on March 31, 2004. Debtor’s turnover has decreased from 118 days to 90 days during the period under consideration.

Other Income

Cash and Bank Balances accounted for 6.08% of the total current assets as on March 31, 2004 Loans and advances accounted for 51.71% of total current assets as on March 31, 2004. Loans and advances have decreased slightly from Rs. 693.84 as on March 31, 2003 to Rs. 643.64 Lacs as on March 31, 2004. The major portion of Loans and advances comprises of Advances given to Hotels for holding rooms and security deposits.

Current Liabilities and Provisions Current Liabilities include Sundry Creditors, expenses payable, Duties and taxes payable and provision for income tax.

During the period under consideration current liabilities increased by Rs. 207.51 Lacs from Rs. 254.22 Lacs as on March 31 2003 to Rs. 461.73 Lacs as on March 31, 2004. This increase is primarily due to increase in business operation.

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Non Current Liabilities

Non-current liabilities consist of long term secured loans; long term unsecured loans and deferred tax liabilities. Non-current liabilities have decreased from Rs. 501.03 as on March 31, 2003 to Rs. 460.85 Lacs as on March 31, 2004. The decrease is mainly attributable to repayment of loans

Net worth of our company has increased by Rs. 68.29 Lacs from Rs. 1244.35 as on March 31, 2003 to Rs. 1312.64 Lacs March 31, 2004 on account of increase in the reserves and surplus. COMPARISON OF FISCAL YEAR 2003 TO FISCAL YEAR 2002 Tour Receipt The receipt from tours were Rs. 1,002.77 Lacs for the period ended March 31, 2003 as against Rs. 1,867.88 Lacs for the year ended March 31, 2002. There was a decline in the tour receipts. The effect of terrorist attack in USA resulted in low flow of tourists into the country. Sales Sales which is the receipt from hotel operations, were Rs. 69.47 Lacs for the period ended March 31, 2003 as against Rs. 70.51 Lacs for the year ended March 31, 2002. Our hotel business registered the same level of operations.

Other income increased from Rs. 6.36 Lacs in the financial year 2001-02 to Rs.8.07 Lacs for the year ended March 31,2003. The increase is due to the gain on sale of the units of Mutual Funds

Net Worth

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Operating Expenses Our operating expenses, which includes Tour expenses and material consumed, as a percentage of Total Income (excluding other income) has decreased from from 71.09% in the fiscal year 2001-02 to 67.00% in the fiscal year 2003-04. The decrease is due to better rates negotiated by our company with the hoteliers.

Interest & Financial Charges

Net profit before tax is Rs. 55.41 Lacs in the fiscal year 2002-03 as against Rs. 103.72 Lacs in the fiscal year 2001-02. This decrease is due to low realization during the period under review though as a percentage to Total Income it remained almost same..

Review of Financial Position

Fixed Assets Comprising of Coaches, Hotel Building, Plant & Machinery installed at Hotel, Cars (Private Vehicles), office equipments, computers, furniture and capital work in progress. The net fixed assets decreased by 51.37 Lacs, from Rs. 869.09 Lacs as on March, 31, 2002 to Rs. 817.72 Lacs as on March 31, 2003, mainly due to the sale of old vehicles.

Salary Salary, Wages and other benefits to the employees, including directors remuneration, as a percentage of Total Income (excluding other income) has increased from 5.82% in the fiscal year 2001-02 to 9.41% in the fiscal year 2002-03. This increase in percentage is due to low realizations during the period under review

Administrative and other Expenses As a percentage of Total Income (excluding other Income) our Administrative Expenses remained almost same i.e. 11.63% in the fiscal year 2002-03 and 11.50% in the fiscal year 2001-02. Selling & Distribution Expenses As a percentage of Total Income (excluding other Income) our Selling & Distribution expenses decreased to 0.76% in the fiscal year 2002-03 against 1.28% in the fiscal year 2001-02. As there was low inflow of tourists, because of terrorist attack in USA, the company did not spend much in this area.

As percentage of Total Income (excluding other Income) our Interest & Financial Expenses increased to 2.04% in the fiscal year 2002-03 against 1.55% in the fiscal year 2001-02. This increase in percentage is due to low total income during the period under review.

As percentage of Total Income (excluding other Income) our depreciation cost has increased to 5.25% in the fiscal year 2002-03 against 3.61% in the fiscal year 2001-02. This increase in percentage is due to low total income during the period under review.

Net Profit before Tax

Fixed Assets

Depreciation

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Investments The investment of our company increased to Rs. 103.50 Lacs in the fiscal year 2002-03 from Rs. 43.50 Lacs in the fiscal year 2001-02. The increase is due to investment in the Units of Mutual funds to the tune of Rs. 60 Lacs. Current Assets Current Assets includes Sundry Debtors, Inventory, Cash & bank Balances, Security Deposits and other Loans & Advances recoverable in Cash or in Kind. Current assets have increased in line with the growth of our business activity. During the period under consideration current assets decreased by Rs. 24.08 Lacs from Rs. 1,102.44 Lacs as on March 31 2 to Rs. 1,078.37 Lacs as on March 31 decrease is primarily due to the decrease in Sundry Debtors and Fixed Deposits of our company.

st 200 st 2003. This

Sundry Debtors accounted for 32.36% of the total current assets as on March 31, 2003. Debtors decreased from Rs. 473.32 Lacs as on March 31, 2002 to Rs. 348.91 Lacs as on March 31, 2003. Debtor’s turnover has increased to 118 days from 89 days during the period under consideration. Cash and Bank Balances accounted for 3.22% of the total current assets as on March 31, 2003 Loans and advances accounted for 64.34% of total current assets as on March 31, 2003. Loans and advances have increased from Rs.556.31 Lacs as on March 31, 2002 to Rs. 693.84 Lacs as on March 31, 2003. The major portion of Loans and advances comprises of Advances given to Hotels for holding rooms and security deposits. Current Liabilities and Provisions Current Liabilities include Sundry Creditors, expenses payable, Duties and taxes payable and provision for income tax.

During the period under consideration current liabilities decreased by Rs. 119.38 Lacs from Rs. 373.60 Lacs as on March 31 2002 to Rs. 254.22 Lacs as on March 31, 2003. This decrease is primarily due to decrease in business operation.

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Non Current Liabilities Non-current liabilities consist of long term secured loans; long term unsecured loans and deferred tax liabilities. Non-current liabilities have increased to Rs. 501.02 as on March 31, 2003 from Rs. 352.96 Lacs as on March 31, 2002 due to provision for deferred tax liability of Rs. 97.95 for the transition period upto 2002 as required under AS-22. Net Worth Net worth of our company has decreased by Rs. 44.12 Lacs from Rs. 1,288.47 as on March 31, 2002 to Rs. 1,244.35 Lacs March 31, 2003 on account of decrease in the reserves and surplus. The decrease in Reserves & Surplus was due to provision for deferred tax liability of Rs. 97.95 for the transition period upto 2002 as required under AS-22.

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SECTION VI - LEGAL AND REGULATORY INFORMATION OUTSTANDING LITIGATIONS, MATERIAL DEVELOPMENTS AND OTHER DISCLOSURES Except as described below or mentioned under the Section – Risk Factors, there are no outstanding litigations, suits or criminal or civil prosecutions, proceedings or tax liabilities against us, our Directors, our promoters or companies/firms promoted by our promoters that would have a material adverse effect on our business and there are no defaults, non-payment or over dues of statutory dues, institutional/ bank dues and dues payable to holders of any debentures, bonds and fixed deposits and arrears of preference shares that would have a material adverse effect on our business other than unclaimed liabilities by us or our directors, our promoters or companies promoted by our promoters.

LITIGATIONS Litigation against our Company There is no litigation pending against our Company involving criminal, Securities and Economic or Statutory Offence. However, there is one litigation outstanding against our Company involving civil Laws and one outstanding involving labour laws, the details of which are provided below: All the legal proceedings referred below are pending at different levels of adjudication before various courts, tribunals, enquiry officers, and appellate tribunals. If any, all or some of these cases are determined against us, our results of operations could be adversely affected.

Cause Title Nature of the Case Amount involved Present Status

1. RGR Transport Pvt. Ltd. V/S Indo Asia Tours Pvt. Ltd. (now ‘Indo Asia Leisure Services Ltd.’) in the Delhi High Court.

Winding up petition u/s 434, filed by RGR on the basis of amount payable by Indo Asia Tours Pvt. Ltd. to RGR. Date of Institution: July 17, 1998.

The court may order to pay the amount claimed

by RGR i.e. Rs.4,85,944/- along with interest, which

cannot exceed18%. As directed by the Hon’ble High Court, Delhi, as a

interim measure, we have already deposited Rs. 2,11,232/- with the court registrar in July

2005.

The proceedings of the case are presently sub-judice.

2. Indo Asia Tours Pvt. Ltd. (now ‘Indo Asia Leisure Services Limited’) V/S Satdev, in the Labour Court No. IV, Karkardooma, Delhi

Complaint by Mr. Satdev u/s 33 C (1) of Industrial Dispute Act 1947. Allegation is that the workman's services were terminated illegally or unjustifiably. Date of Institution: September 18, 1997.

Our company may be required to pay compensation to the tune of Rs.1,95,629/-, along with interest if any, where awarded by Court, to Mr. Satdev. As directed by the Delhi High Court, our company has given an bank guarantee equal to 1,95,629/-in favor of the Labour Court.

The case is pending decision with the Labour Court, Karkardooma, Delhi.

Sr. No.

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Litigation filed by our Company There is no litigation filed by our Company involving criminal, Securities and Economic or Statutory Offence, Civil Offence or Labour Laws, which is outstanding as on date. Litigation filed against/ by the Promoters/ Directors of our Company There is no litigation pending against/ filed by the individual Promoters and Directors of our Company, involving criminal, Securities and Economic or Statutory Offence, Civil Offence or Labour Laws, which is outstanding as on date of filing this Draft Red Herring Prospectus. Litigation filed against/by our Group Companies. There is no litigation pending against/ filed by our Group Companies, involving criminal, Securities and Economic or Statutory Offence, Civil Offence or Labour Laws, which is outstanding as on date of filing this Draft Red Herring Prospectus.

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MATERIAL DEVELOPMENTS Apart from the changes mentioned elsewhere in this Draft Red Herring Prospectus, including the share capital as mentioned in the section titled ‘Capital Structure’ beginning from page no. 15 of this Draft Red Herring Prospectus, which have occurred since the date of the last financial statements disclosed (i.e. February 28, 2006) in this Draft Red Herring Prospectus, the Board of Directors of our Company are not aware of any circumstances that materially or adversely affect or are likely to affect the profitability of our Company or the value of our assets or our ability to pay our liabilities within the next twelve months.

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GOVERNMENT/STATUTORY AND BUSINESS APPROVALS

Government and other approvals

We have received following Government approvals/licenses/permissions in respect of Indo Asia Leisure Services Limited:

1. Registration No.5. TT.II(117)98 dated 11.12.2003 has been granted by the Ministry of Tourism and Culture, Department of Tourism granting extension of recognition as Approved Tour operator with effect from 14.12.2003 to 14.12.2008 for Head Office at New Delhi.

2.

3. Registration No. 5. TT.II(117)98 dated 31.06.2003 has been granted by the Ministry of Tourism and Culture, Department of Tourism granting of recognition as Approved Tour operator with effect from 25.06.2003 to 25.06.2006 for Chennai branch.

In view of the approvals listed below, we can undertake this issue and our current business activities and no further approvals are required from any Government authority for us to continue our activities. Investment Approvals (FIPB/ RBI, etc.)

As per Notification No. FEMA 20/2000 - RB dated May 03, 2000, as amended from time to time, under automatic route of Reserve Bank, we are not required to make an application for Issue of Equity Shares to NRIs/FIIs with repatriation benefits. However, the allotment/transfer of the Equity Shares to NRIs/FIIs shall be subject to prevailing RBI Guidelines. Sale proceeds of such investments in Equity Shares will be allowed to be repatriated along with the income thereon subject to the permission of the RBI and subject to the Indian tax laws and regulations and any other applicable laws.

Licenses and Consents received:

Recognition as Approved Tour Operator

Registration No.5. TT.II(117)98 dated 16.06.2003 has been granted by the Ministry of Tourism and Culture, Department of Tourism granting of recognition as Approved Tour operator with effect from 09.06.2003 to 08.06.2006 for Bangalore branch.

Hotel Division A. Hotel ‘Heritage Resort’, Bikaner 1. Heritage Resort, Bikaner has been classified as ‘3 - Star Hotel’ by the Department of Tourism, Government of

India by the order dated 06th March 2006 for 5 years with effect from 21.02.2006. 2. ‘Heritage Resort’ Bikaner, has taken certification from Gram Panchayat, District Bikaner, Rajasthan as regards

the quality of food served in the Hotel. 3. ‘Heritage Resort’, Bikaner, has taken certification from Gram Panchayat, District Bikaner, Rajasthan and

Department of Tourism and Culture, Rajasthan that rooms, restaurant, banquet hall, lobby & kitchen facilities are best among the standard Hotels.

4. No objection certificate with respect to fire fighting arrangement from Gram Panchayat, District Bikaner,

Rajasthan has been obtained by ‘Heritage Resort’, Bikaner.

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5. ‘Heritage Resort, Bikaner’ has taken Public Liability Insurance from the Oriental Insurance Company limited on 28.11.2005 and same is valid till 28.11.2006.

6. Registration No.TOU/CHENNAI-III/1841/STC dated 22.02.2005 has been granted under the service Tax Act to M/s Indo Asia Holidays, a division of our Company located at Chennai.

6. Registration No.RST/0712/04650 dated 21.06.2000 has been granted under Section 18 of Rajasthan Sales Tax Act, 1954, to ‘Heritage Resort’, a hotel owned by our Company at Bikaner (Rajasthan).

7. Registration No. CST/0712/04650 dated 21.06.2000, effective from 20.06.2000 until cancelled has been granted

under Central Sales Tax Act to Heritage Resort, a hotel owned by our company at Bikaner. VAT No. is 08221354600.

8. License for Sale of Foreign Liquor vide License No.10/2001-02 dated 11.06.2001 valid upto 31.03.2006 has

been granted by Excise Department to Hotel Heritage Resort, a hotel owned by our Company at Bikaner. 9. Registration No.RPCB/RO/BKN/Tech/BKN/I-5/1313 dated 24.09.2004 valid upto 31.01.2011 has been granted

under Water (prevention & control of Pollution) Act, 1974, to Heritage Resort, a Hotel owned by our Company at Bikaner.

10. Registration No. RJ/10203/4136 has been granted under Employees Provident Fund & Misc. Provisions Act, 1952 to Heritage Resort, a Hotel owned by our Company at Bikaner.

11. Registration No. 32/ST/BP/MKS/2003 dated 27.02.2003 has been granted under Service Tax act to Heritage

Resort, a hotel owned by our company located at Bikaner for payment of Service Tax on Mandap Keeper Service.

Incorporation and Other Statutory Compliances 1. Permanent Account Number (PAN) issued by Income Tax Department, Government of India bearing number

AAACI2015C 1. Tax Deduction Account Number (TAN) issued by Income Tax Department, Government of India bearing

number DEL104127E dated April 30, 2004. 2. Profession Tax Registration No. 08-114-PE-0319 dated 29.10.2001. 3. Service Tax Registration No. AAACI 2015CST001 dated July 7, 2004, under Section 69 of the Finance Act,

1994, has been granted to our Company for compliance under the Service Tax Rules, 1994. 4. Registration No.DLI/ST/TO/1156/IAH/2005 dated 31.01.2005 under the Service Tax Act, has been granted to

M/s Indo Asia Holidays, a division of our Company located at New Delhi. 5. Service Tax Registration No.(TOU)/AAACI2015CST002 dated 22.01.2005 has been granted to Indo Asia

Holidays a division of Our Company, located at Bangalore.

7. Registration No. DL- 17072 has been granted to our company under the Employees provident Fund and

miscellaneous Act. 8. Registration No.11-25608-101 has been granted to our company under the Employees State Insurance Act. 9. Registration No.67/CE/208 has been granted under the Karnataka shops and Commercial Establishment Act-

1961 for Bangalore Branch Office of our Company.

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10. Importer – Exporter Code (IEC) No.0599033819 dated October 6, 1999, issued by the Government of India,

Ministry of Commerce, ADGFT, New Delhi has been granted to our company. The said IEC is valid for our Company’s branch offices at Bangalore and Chennai.

Licenses and Consents applied for: Nil Licenses/Approvals not applied for:

1. Our Company is yet to apply to Ministry of Tourism for recognition as Approved Tour Operator for Goa and Kolkata Branch offices. Since we have recently opened these branches, the application can only be made after completion of one year and crossing a turnover of Rs. 5 Lacs.

2. We are in the process of making an application for Service Tax Registration for our Kolkata & Goa Branch

Offices. 3. We have not made an application for registration under Local Shops and Establishments Act for newly opened

offices at Goa and Kolkata.

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OTHER REGULATORY AND STATUTORY DISCLOSURES Authority for the Issue The Issue of Equity Shares has been authorized by a special resolution passed under Section 81(1A) of the Companies Act at the Extra Ordinary General Meeting of the shareholders held on May 12, 2006. Prohibition by SEBI Our Company, our Directors, our Promoters, our group companies, other companies promoted by our promoters and companies with which our Company’s directors are associated as directors have not been prohibited from accessing the capital markets under any order or direction passed by SEBI. Eligibility for the Issue

• We have net tangible assets of at least Rs. 300 lacs in each of the preceding three full years (of 12 months each), of which not more than 50% is held in monetary assets;

• We have a pre-Issue net worth of not less than Rs. 100 lacs in each of the preceding three full years (of 12 months each)

•

• The proposed Issue size would not exceed five times the pre-Issue net worth as per the audited accounts for the year ended March 31, 2005;

•

31.02.2002

Our Company is eligible to make a public issue of Equity Shares in terms of per clause 2.2.1 of the SEBI Guidelines.

We have a track record of distributable profits as per Section 205 of Companies Act for at least three out of the immediately preceding five years;

We have not changed our name during the last one-year. The Company has received the certificate dated May 15, 2006 from M/s. SNR & C0., Chartered Accountants statutory auditors of the company, certifying the following: -

(Rs. in lacs)

As at 31.03.2005 31.03.2004 31.03.2003 31.03.2001 Net Tangible Assets* 1878.77 1737.57 1733.60 1648.07 1593.25 Monetary Assets** 166.31 79.17 138.26 115.73 62.07 Distributable Profits after Tax***

90.37 57.03 20.16 90.04 143.31

Net Worth**** 1441.21 1276.72 1232.58 *Net tangible Assets are defined as the sum of fixed assets (including capital work in progress and excluding revaluation reserves, if any), investments, current assets (excluding deferred tax assets) less Current liabilities (excluding deferred tax liabilities and long term liabilities), net of provision for diminution in value. ** Monetary Assets include cash in hand and bank and quoted investments, including units in open ended mutual fund schemes at cost. *** The Distributable profits of the Company is as per Section 205 of the Act and has been calculated from the audited financials statements of the respective year/period before making adjustments for restatement of financial statements. **** Net worth of the Company includes equity share capital and reserve.

1295.11 1213.85

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Our Company undertakes that the number of allottees in the Issue shall be at least 1000. Otherwise, the entire application money shall be refunded forthwith. In case of delay, if any, in refund, our Company shall pay interest on the application money at the rate of 15% per annum for the period of delay. DISCLAIMER CLAUSE AS REQUIRED A COPY OF THE DRAFT RED HERRING PROSPECTUS HAS BEEN SUBMITTED TO SEBI. IT IS TO BE DISTINCTLY UNDERSTOOD THAT THE SUBMISSION OF THIS DRAFT RED HERRING PROSPECTUS 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. THE BOOK RUNNING LEAD MANAGERS – IDBI CAPITAL MARKET SERVICES LIMITED, HAVE CERTIFIED THAT THE DISCLOSURES MADE IN THE DRAFT RED HERRING PROSPECTUS ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH SEBI GUIDELINES FOR DISCLOSURES AND INVESTOR PROTECTION IN FORCE FOR THE TIME BEING. THIS REQUIREMENT IS TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION FOR MAKING INVESTMENT IN THE PROPOSED ISSUE. IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE ISSUER COMPANY IS PRIMARILY RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT INFORMATION IN THE DRAFT RED HERRING PROSPECTUS, THE BOOK RUNNING 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 BOOK RUNNING LEAD MANAGER - IDBI CAPITAL MARKET SERVICES LIMITED HAS FURNISHED TO SEBI A DUE DILIGENCE CERTIFICATE DATED MAY 15, 2006 IN ACCORDANCE WITH SEBI (MERCHANT BANKERS) REGULATIONS, 1992 WHICH READS AS FOLLOWS: I. WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO

LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH COLLABORATORS ETC. AND OTHER MATERIALS IN CONNECTION WITH THE FINALISATION OF THE DRAFT RED HERRING PROSPECTUS PERTAINING TO THE SAID ISSUE.

A) THE DRAFT RED HERRING PROSPECTUS FORWARDED TO SEBI IS IN CONFORMITY WITH THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE ISSUE;

II. ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE COMPANY, ITS

DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES, INDEPENDENT VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTS OF THE ISSUE, PROJECTED PROFITABILITY, PRICE JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTS MENTIONED IN THE ANNEXURE AND OTHER PAPERS FURNISHED BY THE COMPANY. WE CONFIRM THAT:

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

C) THE DISCLOSURES MADE IN THE DRAFT RED HERRING PROSPECTUS ARE TRUE, FAIR AND ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL INFORMED DECISION AS TO THE INVESTMENT IN THE PROPOSED ISSUE.

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III. III WE CONFIRM THAT BESIDE OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE DRAFT RED HERRING PROSPECTUS ARE REGISTERED WITH SEBI AND THAT TILL DATE SUCH REGISTRATION IS VALID.

IV. WHEN UNDERWRITTEN WE SHALL SATISFY OURSELVES ABOUT THE NETWORTH OF THE

UNDERWRITERS TO FULFILL THEIR UNDERWRITING COMMITMENTS. V. WE CERTIFY THAT WRITTEN CONSENT HAS BEEN OBTAINED FROM THE PROMOTERS

FOR INCLUSION OF THEIR SECURITIES AS PART OF THE PROMOTERS’ CONTRIBUTION SUBJECT TO LOCK-IN AND THE SECURITIES PROPOSED TO FORM AN PART OF THE PROMOTERS’ CONTRIBUTION SUBJECT TO LOCK-IN WILL NOT BE SOLD/DISPOSED/TRANSFERRED BY THE PROMOTERS DURING THE PERIOD STARTING FROM THE DATE OF FILING OF THE DRAFT RED HERRING PROSPECTUS WITH SEBI TILL THE DATE OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE DRAFT RED HERRING PROSPECTUS

THE FILING OF THE DRAFT RED HERRING PROSPECTUS DOES NOT, HOWEVER ABSOLVE THE COMPANY 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 FOR ANY IRREGULARITIES OR LAPSES IN THE DRAFT RED HERRING PROSPECTUS

All information will be made available by us and the BRLMs to the public and the investors at large and no selective or additional information would be available for a section of the investors in any manner whatsoever including at road show presentations, in research or sales reports, at bidding centers or elsewhere.

DISCLAIMER IN RESPECT OF JURISDICTION

COMPANY DISCLAIMER Our Company, our Directors and the BRLMs accept no responsibility for statements made otherwise than in this Draft Red Herring Prospectus or in the advertisement or in any other material issued by or at our instance and any one placing reliance on any other source of information would be doing so at his/her/their own risks. The BRLMs does not accept any responsibility, save to the limited extent as provided in the Memorandum of Understanding entered into between the BRLMs and us and the Underwriting Agreement to be entered into between the Underwriters and us.

This Issue is being made in India to persons resident in India (including Indian nationals resident in India) who are majors, Hindu Undivided Families, companies, corporate bodies and societies registered under the applicable laws in India and authorized to invest in shares, Indian mutual funds registered with SEBI, Indian financial institutions, commercial banks, regional rural banks, co-operative banks (subject to RBI permission), Trusts registered under the Societies Registration Act, 1860, or any other Trust law and who are authorized under their constitution to hold and invest in shares) and to NRIs and FIIs as defined under the Indian laws. This Draft Red Herring Prospectus does not, however, constitute an offer to sell or an invitation to subscribe to securities issued hereby in any other jurisdiction. Any person into whose possession this Draft Red Herring Prospectus comes is required to inform himself or herself about and to observe any such restrictions. Any dispute arising out of this Issue will be subject to the jurisdiction of appropriate court(s) in New Delhi, 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 Draft Red Herring Prospectus has been submitted to the SEBI. Accordingly, the Equity Shares represented thereby may not be offered or sold, directly or indirectly, and this Draft Red Herring

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Prospectus may not be distributed, in any jurisdiction, except in accordance with the legal requirements applicable in such jurisdiction. Neither the delivery of Draft Red Herring Prospectus 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. DISCLAIMER CLAUSE OF BOMBAY STOCK EXCHANGE LIMITED (BSE)

As required a copy of this Draft Red Herring Prospectus has been submitted to BSE. The BSE has given the permission to the Company vide its letter dated [•] to use their name in this Draft Red Herring Prospectus as one of the stock exchanges on which Equity Shares of the Company being issued in terms of this Draft Red Herring Prospectus are proposed to be listed. The BSE has scrutinized this Draft Red Herring Prospectus for their limited internal purpose of deciding on the matter of granting the aforesaid permission to the Company. It is to be distinctly understood that the aforesaid permission given by the BSE should not in any way be deemed or construed that the Draft Red Herring Prospectus has been cleared or approved by BSE nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this Draft Red Herring Prospectus; nor does it warrant that the Company’s securities will be listed or will continue to be listed on the BSE nor does it take any responsibility for the financial or other soundness of the Company, its Promoters, its management or any scheme or project of this Company. Every person who desires to apply for or otherwise acquires any securities of this Company may do so pursuant to an independent inquiry or any investigation and analysis and shall not have any claim against the BSE whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/ acquisition whether by reason of anything stated or omitted to be stated herein or for any other reason whatsoever. DISCLAIMER CLAUSE OF THE NATIONAL STOCK EXCHANGE OF INDIA LIMITED (NSE) As required a copy of this Draft Red Herring Prospectus has been submitted to the NSE. The NSE has given the permission to the Company vide its letter dated [•] to use their name in this Draft Red Herring Prospectus as one of the stock exchanges on which Equity Shares of the Company being issued in terms of this Draft Red Herring Prospectus are proposed to be listed. NSE has scrutinized this Draft Red Herring Prospectus for their limited internal purpose of deciding on the matter of granting the aforesaid permission to the Company. It is to be distinctly understood that the aforesaid permission given by NSE should not in any way be deemed or construed that the Draft Red Herring Prospectus has been cleared or approved by NSE nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this Draft Red Herring Prospectus; nor does it warrant that the Company’s securities will be listed or will continue to be listed on the Exchange nor does it take any responsibility for the financial or other soundness of the Company, its promoters, its management or any scheme or project of this Company. Every person who desires to apply for or otherwise acquires any securities of this Company may do so pursuant to an independent inquiry or any investigation and analysis and shall not have any claim against the exchange whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/ acquisition whether by reason of anything stated or omitted to be stated herein or for any other reason whatsoever.

FILING A copy of the Red Herring Prospectus, along with the documents required to be filed under Section 60B of the Companies Act, would be delivered for registration to the RoC, N.C.T., Delhi and Haryana and a copy of the Prospectus to be filed under Section 60 of the Companies Act would be delivered for registration with RoC. A copy of the Draft Red Herring Prospectus has been filed with SEBI, Mumbai.

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LISTING The Equity Shares issued through this Draft Red Herring Prospectus are proposed to be listed on Bombay Stock Exchange Ltd. (BSE) and National Stock Exchange of India Ltd. (NSE). In-principle approval for listing of the equity shares of the Company from BSE has been received vide their letter dated [•] and from NSE has been received vide letter dated [•]. Our Company shall ensure that all steps for the completion of the necessary formalities for listing and commencement of trading at the Stock Exchanges mentioned above are taken within seven working days of finalization and adoption of the Basis of Allotment for this Issue. Impersonation Attention of the applicants is specifically drawn to the provisions of Sub-Section (1) of Section 68A of the Companies Act, 1956 which is reproduced below: “Any person who- (a) makes in a fictitious name an application to a Company for acquiring, or subscribing for, any shares

therein, or (b) otherwise induces a Company to allot or register any transfer of shares therein to him, or any other

person in a fictitious name, shall be punishable with imprisonment for a term which may extend to five years.”

Consents Consents in writing of: (a) the Directors, the Company Secretary, the Auditors, Legal Advisor, Bankers to the Company, Escrow Collection Banks and Bankers to the Issue; and (b) Book Running Lead Managers to the Issue, Syndicate Members and Registrars to the Issue, to act in their respective capacities, have been obtained and shall be filed along with a copy of the Red Herring Prospectus with the Registrar of Companies, Maharashtra at Mumbai as required under Section 60 and 60B of the Companies Act and such consents have not been withdrawn up to the time of delivery of the offer document for registration. M/s SNR & Co., Chartered Accountants, our statutory auditors have given their written consent to the inclusion of their report in the form and context in which it appears in this Draft Red Herring Prospectus and such consent and report has not been withdrawn up to the time of delivery of this Draft Red Herring Prospectus for registration to the Registrar of Companies, N.C.T., Delhi and Haryana. M/s. SNR & Co., Chartered Accountants, have given their written consent to the tax benefits accruing to our Company and its members in the form and context in which it appears in this Draft Red Herring Prospectus and has not withdrawn such consent up to the time of delivery of this Draft Red Herring Prospectus for registration with the Registrar of Companies, N.C.T., Delhi and Haryana. Expert Opinions Except as stated elsewhere in this Draft Red Herring Prospectus, we have not obtained any expert opinions. Expenses of the Issue Details of fees payable are estimated as follows:

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Sr. No. Particulars Amount

(Rs. in Lacs)

% of Total Issue

Expenses

% of Total Issue Size

1 Lead Management, Underwriting and Selling Commission [•] [•] [•] 2 Advertisement & Marketing Expenses [•] [•] [•] 3 Printing & Stationery, Distribution, Postage, etc. [•] [•] [•] 4 Other Expenses (incl. Fees of Registrar, Legal Advisor, Auditors

and Tax Auditors, Filing Fees, Listing Fees, Depository Charges, etc.)*

[•] [•] [•]

Total [•] [•] [•] Fees Payable to BRLMs The total fees payable to the BRLMs will be as per the Memorandum of Understanding signed amongst the Company and the BRLMs, a copy of which is available for inspection at the Registered Office of our Company. Fees Payable to Registrar to the Issue The total fees payable to the Registrar to the Issue will be as per the Memorandum of Understanding signed with the Registrar, copy of which is available for inspection at our Registered Office. The Registrar will also be reimbursed with all relevant out-of-pocket expenses such as cost of stationery, postage, stamp duty, communication expenses, etc. Adequate funds will be provided to the Registrar to the Issue to enable them to make refunds to unsuccessful applicants. Others The total fees payable to the Legal Advisor, Auditors and Tax Auditors will be as per the terms of their respective engagement letters. Underwriting Commission, Brokerage and Selling Commission The Underwriting Commission will be paid not more than [•] of the Public Issue Size (excluding Promoters’ Group Contribution in the Issue). Brokerage for the Issue will be paid not more than @ [•] of the Issue Price of the Equity Shares by the company on the basis of the allotments made against the applications bearing the stamp of a member of any recognized Stock Exchange in India in the ‘Broker’ column. Brokerage at the same rate will also be payable to the Bankers to the Issue in respect of the allotments made against applications procured by them provided the respective forms of application bear their respective stamp in the Broker column. In case of tampering or over-stamping of Brokers’/ Agents’ codes on the application form, the Company’s decision to pay brokerage in this respect will be final and no further correspondence will be entertained in this matter. We, at our sole discretion, may consider payment of additional incentive in the form of kitty or otherwise to the performing brokers on such terms and mode as may be decided by us. Previous Public or Rights Issues (during the last five years) We have not made any public or rights issue during last five years.

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Commission or Brokerage on Previous Issues No sum has been paid or is payable as commission or brokerage for subscribing to or procuring for, or agreeing to procure subscription for any of the Equity Shares of the Company since its inception. Outstanding Debenture or Bond Issues As on the date of filing of this Draft Red Herring Prospectus, the Company does not have any outstanding Debenture or Bond Issue. Outstanding Preference Shares As on the date of filing of this Draft Red Herring Prospectus, the Company does not have any outstanding preference shares. Issue of Shares Otherwise than for Cash Other than the bonus shares issued by us on March 31, 2005 I the ratio of 5:1, we have made the following allotment of shares for consideration other than cash. Date of Allotment

No. of Equity Shares

Face Value (Rs.)

Issue Price (Rs.)

Reason for allotment Name of person/ Entity to whom shares were allotted

March 16, 1993 9999

10 10 Allotment against transfer of assets from partnership firm M/s Indo Asia Tours, of which Mr. Sunirmol Ghosh, Mr. R. K. Gupta, Mr. Sudesh Behal and Mr. Prem Chand were the partners.

Sunirmol Ghosh

March 16, 1993 9999 10 10 Allotment against transfer of receivables from partnership firm M/s Indo Asia Tours of which Mr. Sunirmol Ghosh, Mr. R. K. Gupta, Mr. Sudesh Behal and Mr. Prem Chand were the partners.

R. K. Gupta

March 16, 1993

9999

Allotment against transfer of receivables from partnership firm M/s Indo Asia Tours of which Mr. Sunirmol Ghosh, Mr. R. K. Gupta, Mr. Sudesh Behal and Mr. Prem Chand were the partners.

10 10 Sudesh Behal

March 16, 1993

9999

10 10 Allotment against transfer of receivables from partnership firm M/s Indo Asia Tours of which Mr. Sunirmol Ghosh, Mr. R. K. Gupta, Mr. Sudesh Behal and Mr. Prem Chand were the partners.

Prem Chand

Companies under the same Management There is no listed company under the same management within the meaning of Section 370 (1B) of the Companies Act. Option to Subscribe Equity shares being offered through this Draft Red Herring Prospectus can be applied for in dematerialized form only.

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Stock Market Data for our Equity Shares This being an initial public issue of our Company, the Equity Shares of our Company are not listed on any stock exchange. Particulars in regard to Public Issue during the last three years We have not made any public issues during the last five years. Promise vis-à-vis Performance The Company did not make any issue in past so the performance of the company vis-à-vis the projection is not applicable. Listed Ventures of Promoter There is no other listed company promoted by our promoters. Investors’ Grievances Redressal Mechanism The agreement between the Registrar to this Issue and us will provide for retention of records with the Registrar to this Issue for a period of at least one year from the last date of dispatch of the letters of allotment, demat credit and making refunds as per the modes disclosed to enable the investors to approach the Registrar to this Issue for redressal of their grievances. All grievances relating to this Issue may be addressed to the Registrar to this Issue, giving full details such as name, address of the applicant, number of Equity Shares applied for, amount paid on application and the bank branch or collection center where the application was submitted. We estimate that the average time required by us or the Registrar to this Issue for the redressal of routine investor grievances will be seven business days from the date of receipt of the complaint. In case of non-routine complaints and complaints where external agencies are involved, we will seek to redress these complaints as expeditiously as possible. Our Company has appointed Mr. Bhupinder Kumar, Company Secretary as the Compliance Officer and he may be contacted at Indo Asia Leisure Services Limited, C-28, South Extension Part - I, New Delhi – 110 049, Tel +91-011- 24691733/44; Fax: +91- 011- 24620533, Email: ipo@indoasiatours.com. Investors can contact him for redressal of any complaints. Changes in Auditors during the last three financial years and reasons thereof There have been no changes of the Auditors of our Company for the last three years. Capitalisation of Reserves or Profits We have capitalised our reserves on March 31, 2005 by issuing 75,00,000 Bonus Shares of Face Value Rs.10/- each, in the ratio of 5 : 1. Revaluation of assets We have not revalued our assets in the past five years.

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SECTION VII – ISSUE RELATED INFORMATION TERMS OF THE ISSUE The Equity Shares being offered are subject to the provisions of the Companies Act, the Memorandum and Articles of Association of the Company, conditions of RBI approval, the terms of this Draft Red Herring Prospectus, Bid-cum-Application Form, the Revision Form, the Confirmation of Allocation Note (“CAN”) and other terms and conditions as may be incorporated in the Allotment Advice, and other documents/certificates that may be executed in respect of the Issue. The Equity Shares shall also be subject to laws as applicable, guidelines, notifications and regulations relating to the issue of capital and listing and trading of securities issued from time to time by SEBI, Government of India, Stock Exchanges, RBI, RoC and/or other authorities, as in force on the date of the Issue and to the extent applicable. Authority for the Issue The Issue of equity shares has been authorized by a special resolution adopted pursuant to Section 81(1A) of the Companies Act, 1956 at the Annual General meeting of the shareholders held on May 12, 2006. Ranking of Equity Shares The Equity Shares being offered shall be subject to the provisions of the Memorandum and Articles of Association and shall rank pari passu in all respects with the other existing shares of the Company including in respect of the rights to receive dividends. Mode of payment of dividend We shall pay dividend to our shareholders as per the provisions of the Companies Act, 1956. Face Value and Issue Price The Equity Shares with a face value of Rs. 10/- each are being offered in terms of this Draft Red Herring Prospectus at a total price of Rs. [●] per share. At any given point of time, there shall be only one denomination for the Equity Shares of the Company, subject to applicable laws. The issue price is [●] times the face value of the equity shares. Compliance with SEBI Guidelines The Company shall comply with all disclosure and accounting norms as specified by SEBI from time to time. In this regards we have appointed Mr. Bhupinder Kumar, Company Secretary as the Compliance Officer. Rights of the Equity Shareholder Subject to applicable laws, the equity shareholders shall have the following rights:

• Right to receive dividend, if declared; • Right to attend general meetings and exercise voting powers, unless prohibited by law; • Right to vote on a poll either 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 of free transferability; and • Such other rights, as may be available to a shareholder of a listed public company under the Companies Act

and Articles of Association of the Company.

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For a detailed description of the main provisions of the 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 the Articles of Association’ on page no. 182 in this Draft Red Herring Prospectus. Market Lot The Equity Shares of the Company shall be allotted only in dematerialized form. In terms of existing SEBI Guidelines, the trading in the Equity Shares of the Company shall only be in dematerialized form for all investors. Since trading of our Equity Shares is in dematerialized mode, the tradable lot is one equity share. Allocation and allotment of Equity Shares through this Issue will be done only in electronic form, in multiple of one equity share, subject to a minimum allotment of [●] Equity Shares. For details of allocation and allotment, please refer to the section titled ‘Issue Procedure’ on page no.159 of this Draft Red Herring Prospectus. Jurisdiction Exclusive jurisdiction for the purpose of this Issue is with competent courts/authorities in New Delhi, India. Nomination Facility to the Investor In accordance with Section 109A of the Companies Act, the sole or first bidder, along with other joint bidder, may nominate any one person in whom, in the event of the death of sole bidder or in case of joint bidders, death of all the bidders, as the case may be, the Equity Shares allotted, if any, shall vest. A person, being a nominee, entitled to the Equity Shares by reason of the death of the original holder(s), shall in accordance with Section 109A of the Companies Act, be entitled to the same advantages to which he or she would be entitled if he or she were the registered holder of the equity share(s). Where the nominee is a minor, the holder(s) may make a nomination to appoint, in the prescribed manner, any person to become entitled to equity share(s) in the event of his or her death during the minority. A nomination shall stand rescinded upon a sale/ transfer/ alienation of equity share(s) by the person nominating. A buyer will be entitled to make a fresh nomination in the manner prescribed. Fresh nomination can be made only on the prescribed form available on request at our Registered / Corporate Office or to our Registrar and Transfer Agents. In accordance with Section 109B of the Companies Act, any person who becomes a nominee by virtue of the provisions of Section 109A of the Companies Act, shall upon the production of such evidence as may be required by the Board, elect either:

• to register himself or herself as the holder of the equity shares; or • to make such allotment of the equity shares, as the deceased holder could have made.

Further, the Board may at any time give notice requiring any nominee to choose either to be registered himself or herself or to allot the equity shares, and if the notice is not complied with within a period of ninety days, the Board may thereafter withhold payment of all dividends, bonuses or other monies payable in respect of the equity shares, until the requirements of the notice have been complied with. Since the allotment of Equity Shares in the Issue will be made only in dematerialized mode, there is no need to make a separate nomination with us. Nominations registered with respective depository participant of the applicant would prevail. If the investors require changing the nomination, they are requested to inform their respective depository participant.

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Minimum Subscription If we do not receive the minimum subscription of 90% of the net offer to public including devolvement of Underwriters within 60 days from the date of closure of the issue, the Company shall forthwith refund the entire subscription amount received. If there is a delay beyond 8 days after the Company becomes liable to pay the amount, the Company shall pay interest as prescribed under Section 73 of the Companies Act. Arrangement for disposal of odd lot Our shares will be traded in dematerialized form only and therefore the marketable lot is one (1) Equity Share. Hence, there is no possibility of any odd lots. Subscription by NRIs/ FIIs/Foreign Venture Capital Funds registered with SEBI As per the extant policy of the Government of India, OCBs cannot participate in this Issue. As per the current provisions of the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000, there exists a general permission for the NRIs, FIIs and foreign venture capital investors registered with SEBI to invest in shares of an Indian companies by way of subscription in an IPO. However, such investments would be subject to other investment restrictions under the RBI and/or SEBI regulations as may be applicable to such investors. Based on the above provisions, it will not be necessary for the investors to seek separate permission from the FIPB/ RBI for this specific purpose. However, it is to be distinctly understood that there is no reservation for NRIs, FIIs and foreign venture capital funds registered with SEBI and all NRI, FII and foreign venture capital funds registered with SEBI applicants will be treated on the same basis with other categories for the purpose of allocation. The allotment of the Equity Shares to Non-Residents shall be subject to the conditions as may be prescribed by the Government of India/RBI while granting such approvals. The Equity Shares have not been and will not be registered under the U.S. Securities Act 1933, as amended or any state securities laws in the United States and may not be offered or sold within the United States or to, or for the account or benefit of, “U.S. persons” (as defined in Regulation S of the U.S. Securities Act, 1933), except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. Accordingly, the Equity Shares will be offered and sold only (i) in the United States to “qualified institutional buyers”, as defined in Rule 144A of the Securities Act, and (ii) outside the United States in compliance with Regulation S and the applicable laws of the jurisdiction where those offers and sales occur.

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ISSUE PROCEDURE

Book Building Procedure This issue is being made through 100% Book Building Process wherein up to 50% of the issue shall be allocated on a proportionate basis to Qualified Institutional Buyers (“QIBs”). Out of the portion available for allocation to the QIBs, 5% of 50% portion of QIBs shall be available for allocation on proportionate basis to Mutual Funds and the remaining QIB portion shall be available for allocation on proportionate basis to all QIBs, including Mutual Funds subject to valid bids being received at or above the Issue Price. Further, not less than 15% of the Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 35% of the Issue shall be available for allocation on a proportionate basis to Retail Individual Bidders, subject to valid bids being received at or above the issue price. Bidders are required to submit their Bids through the Syndicate. We, in consultation with the BRLMs reserve the right to reject any QIB Bid procured by any or all members of the Syndicate provided the rejection is at the time of receipt of such Bids and the reason for rejection of the Bid is communicated to the bidder at the time of rejection of bid. In case of Non Institutional Bidders and Retail Bidders we would have a right to reject the Bids only on technical grounds. Investors should note that Equity Shares would be allotted to all successful Bidders only in dematerialized form. Bidders will not have the option of getting Allotment of the Equity Shares in physical form. The Equity shares on Allotment shall be traded only in the dematerialized segment of the Stock Exchanges. Bid-cum-Application Form Bidders shall only use the Bid-cum-Application Form bearing the stamp of a member of the Syndicate for making a Bid in terms of the Red Herring Prospectus. The Bidder shall have the option to make a maximum of three Bids in the Bid-cum-Application Form and such options shall not be considered as multiple Bids. Upon the allocation of Equity Shares, dispatch of the CAN and filing of the Prospectus with the RoC, the Bid-cum-Application Form shall be considered as the Application Form. Upon completing and submitting the Bid-cum-Application Form to a member of the Syndicate, the Bidder is deemed to have authorized us to make the necessary changes in this Draft Red Herring Prospectus and the Bid-cum-Application Form as would be required for filing the Prospectus with the RoC and as would be required by the RoC after such filing, without prior or subsequent notice of such changes to the Bidder. The prescribed colour of the Bid-cum-Application Form for various categories is as follows: Category Colour of Bid-cum-Application Form Indian Public or NRIs applying on a non-repatriation basis White Non-residents including NRIs, FIIs, Foreign Venture CapitalFund applying on repatriation basis

Blue

Who Can Bid? 1. Indian nationals resident in India who are majors, in single or joint names (not more than three); 2. HUFs, in the individual name of the Karta. The Bidder should specify that the Bid is being made in the name of

the HUF in the Bid cum Application Form as follows: “Name of Sole or First Bidder: XYZ Hindu Undivided Family applying through XYZ, where XYZ is the name of the Karta”. Bids by HUFs would be considered at par with those from individuals;

3. Companies, corporate bodies and societies registered under the applicable laws in India and authorized to invest in Equity Shares;

4. Indian mutual funds registered with SEBI;

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5. Indian financial institutions, commercial banks, regional rural banks, co-operative banks (subject to RBI regulations and SEBI regulations, as applicable);

6. Venture capital funds registered with SEBI; 7. Foreign venture capital investors registered with SEBI subject to compliance with applicable laws, rules,

regulations, guidelines and approvals in the Offer; 8. FIIs registered with SEBI subject to compliance with applicable laws, rules, regulations, guidelines and

approvals in the Offer; 9. State Industrial Development Corporations; 10. Insurance companies registered with the Insurance Regulatory and Development Authority; 11. Provident funds with minimum corpus of Rs. 250 million and who are authorized under their constitution to

invest in Equity Shares; 12. Pension funds with minimum corpus of Rs. 250 million and who are authorized under their constitution to

invest in Equity Shares; 13. Trusts registered under the Societies Registration Act, 1860, as amended, or under any other law relating to

trusts and who are authorized under their constitution to hold and invest in Equity Shares; 14. Eligible Non-residents including NRIs and FIIs on a repatriation basis or a non-repatriation basis subject to

applicable local laws; and 15. Scientific and/or industrial research organizations authorized under their constitution to invest in Equity Shares. 16. Any other QIBs permitted to invest, subject to compliance with applicable laws, rules, regulations, guidelines

and approvals in the Offer; Bidders are advised to ensure that any single Bid from them does not exceed the investment limits or maximum number of Equity Shares that can be held by them under the relevant regulations or statutory guidelines. Application by Mutual Funds An eligible Bid by a Mutual Fund shall first be considered for allocation proportionately in the Mutual Fund Portion. In the event that the demand is greater than 4,28,600 Equity Shares, allocation shall be made to Mutual Funds proportionately, to the extent of the Mutual Funds Portion. The remaining demand by Mutual Funds shall, as part of the aggregate demand by QIBs, be made available for allocation proportionately out of the remainder of the QIB Portion, after excluding the allocation in the Mutual Fund Portion. As per the current regulations, the following restrictions are applicable for investments by mutual funds: No Mutual Fund Scheme shall invest more than 10% of its net asset value in the Equity shares or equity related instruments of any company provided that the limit of 10% shall not be applicable for investments by index funds or sector or industry specific funds. No Mutual fund under all its schemes should own more than 10% of any company’s paid up capital carrying voting rights. These limits would have to be adhered to by the mutual funds for investment in the Equity Shares. In case of a Mutual Fund, a separate Bid can be made in respect of each scheme of the Mutual Fund registered with SEBI and such Bids in respect of more than one scheme of the Mutual fund will not be treated as multiple bids provided that the Bids clearly indicate the scheme concerned for which the Bid has been made. The applications made by the asset management companies or custodians of a Mutual Fund shall clearly indicate the name of the concerned scheme for which the application is being made. Under the SEBI Guidelines 5% of the QIB portion i.e. 4,28,600 shares shall be available for allocation on a proportionate basis for Mutual Funds only.

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As per current regulations, the following restrictions are applicable for investment by FIIs: The issue of Equity Shares to a single FII should not exceed 10% of the post-issue paid-up capital of the Company (i.e. 10% of 1,75,72,000 Equity Shares). In respect of an FII investing in Equity Shares of the Company on behalf of its sub-accounts, the investment on behalf of each sub-account shall not exceed 10% of the total issued capital of the Company. As of now, the aggregate FII holding in the Company cannot exceed 24 % of the total paid-up capital of the Company. With the approval of the Board of Directors and the shareholders by way of a special resolution, the aggregate FII holding can go up to 100%. However, as of this date, no such resolution has been recommended for adoption. Subject to compliance with all applicable Indian laws, rules, regulations, guidelines and approvals in terms of regulation 15A(1) of the Securities Exchange Board of India (Foreign Institutional Investors) Regulations 1995, as amended, an FII or its sub account may issue, deal or hold, off shore derivative instruments such as Participatory notes, equity-linked notes or any other similar instruments against underlying securities listed or proposed to be listed in any stock exchange in India only in favour of those entities which are regulated by any relevant regulatory authorities in the countries of their incorporation or establishment subject to compliance of “know your client” requirements. An FII or sub-account shall also ensure that no further downstream issue or transfer of any instrument referred to hereinabove is made to any person other than a regulated entity. As per the current regulations, the following restrictions are applicable for investments by SEBI registered Venture Capital Funds: The SEBI (Venture Capital Funds) Regulations, 1996 and the SEBI (Foreign Venture Capital Investors) Regulations, 2000 prescribe investment restrictions on venture capital funds and foreign venture capital investors registered with SEBI. Accordingly, the holding by any individual venture capital fund or foreign venture capital investor registered with SEBI should not exceed 25 % of our Company’s paid-up capital. The above information is given for the benefit of the Bidders. Our Company and the BRLMs are not liable for any amendments or modification or changes in applicable laws or regulations, which may happen after the date of this Draft Red Herring Prospectus. Bidders are advised to make their independent investigations and ensure that the number of Equity Shares bid for do not exceed the applicable limits under laws or regulations. Maximum and Minimum Bid Size For Retail Individual Bidders: The Bid must be for a minimum of [●] Equity Shares and in multiples of [●]Equity Shares thereafter, subject to maximum Bid amount of Rs. 100,000. In case the maximum Bid amount is more than Rs. 100,000 then the same would be considered for allocation under the Non-Institutional Bidders category. The Cut-off option is given only to the Retail Individual Bidders indicating their agreement to bid and purchase at the final Issue Price as determined at the end of the Book Building Process. (b) For Non-Institutional Bidders and QIBs Bidders: The Bid must be for a minimum of such Equity Shares such that the Bid Amount exceeds Rs. 100,000 and in multiples of [●]Equity Shares thereafter. A Bid cannot be submitted for more than the size of the Issue. However, the maximum Bid by a QIB should not exceed the investment limits prescribed for them by the regulatory or statutory authorities governing them. Under existing SEBI guidelines, a QIB Bidder cannot withdraw its Bid after the Bid/Issue Closing Date. In case of revision of bids, the Non Institutional Bidders who are individuals have to ensure that the Bid Amount is greater than Rs. 100,000. In case the Bid Amount reduces to Rs. 100,000 or less due to a revision in Bids or revision of the Price Band, the same would be considered for allocation under the Retail portion. Non Institutional Bidders and QIB Bidders are not allowed to Bid at ‘cut-off’.

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Bidding Process (a) Our Company will file the Red Herring Prospectus with the RoC. (b) The members of the Syndicate will circulate copies of the Red Herring Prospectus along with the Bid-cum-

Application Form to potential investors. (c) Any investor (who is eligible to invest in our Equity Shares) who would like to obtain the Red Herring

Prospectus and/ or the Bid-cum-Application Form can obtain the same from our corporate office or from any of the BRLMs /Syndicate Members.

(d) Investors who are interested in subscribing for our Company’s Equity Shares should approach any of the

BRLMs or Syndicate Member or their authorized agent(s) to register their Bid. (e) The Bids should be submitted on the prescribed Bid-cum-Application Form only. Bid-cum-Application Forms

should bear the stamp of the members of the Syndicate. Bid-cum-Application Forms, which do not bear the stamp of the members of the Syndicate, will be rejected.

Bidding a) Our Company and the BRLMs shall declare the Bid/Issue Opening Date, Bid/Issue Closing Date and Price

Band at the time of filing the Red Herring Prospectus with RoC, and also publish the same in one English national daily, one Hindi national daily and one regional daily newspaper. This advertisement shall contain the disclosures as prescribed under SEBI Guidelines The BRLMs and Syndicate Members shall accept Bids from the Bidders during the Issue Period.

b) The Bidding Period shall be a minimum of three working days and not shall not exceed seven working days. In

case the Price Band is revised, the revised Price Band and Bidding Period will be published in two national newspapers (one each in English and Hindi) and a regional newspaper also by indicating on the websites of the BRLMs and at the terminals of the members of the Syndicate the Bidding Period may be extended, if required, by an additional three working days, subject to the total Bidding Period not exceeding 10 working days.

c) Each Bid-cum-Application Form will give the Bidder the choice to bid for up to three optional prices (for details refer to the paragraph entitled “Bids at Different Price Levels” below) and specify the demand (i.e. the number of Equity Shares bid for) in each option. The price and demand options submitted by the Bidder in the Bid-cum-Application Form will be treated as optional demands from the Bidder and will not be cumulated. After determination of the Issue Price, the maximum number of Equity Shares bid for by a Bidder at or above the Issue Price will be considered for allocation and the rest of the Bid(s), irrespective of the Bid Price, will become automatically invalid.

d) The Bidder cannot bid on another Bid-cum-Application Form after his or her Bids on one Bid-cum-Application Form have been submitted to any member of the Syndicate. Submission of a second Bid cum-Application Form to either the same or to another member of the Syndicate will be treated as multiple bids and is liable to be rejected either before entering the Bid into the electronic bidding system, or at any point of time prior to the allocation or allotment of Equity Shares in this Issue. However, the Bidder can revise the Bid through the Revision Form, the procedure for which is detailed under the paragraph ‘Build up of the Book and Revision of Bids’ on page no. 166 of this Draft Red Herring Prospectus.

e) During the Bidding Period, Bidders may approach the Syndicate Member to submit their Bid. Every Syndicate Member shall accept Bids from all clients / investors who place orders through them and shall have the right to vet the Bids. f) Along with the Bid-cum-Application Form, all Bidders will make payment in the manner described under

the paragraph ‘Terms of Payment’ on page no. 164 of this Draft Red Herring Prospectus.

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g) The BRLMs and Syndicate Member will enter each bid option into the electronic bidding system as a separate Bid and generate a Transaction Registration Slip, (“TRS”), for each price and demand option and give the same to the Bidder. Therefore, a Bidder can receive up to three TRSs for each Bid-cum-Application Form. It is the responsibility of the Bidder to obtain the TRS from the members of the Syndicate.

Bids at Different Price Levels (a) The Price Band has been fixed at Rs. [●] to Rs. [●] per Equity Share of Rs. 10 each, Rs. [●] being the Floor

Price and Rs. [●] being the Cap Price. The Bidders can bid at any price with in the Price Band, in multiples of Re 1. In accordance with SEBI Guidelines, the Company in consultation with the BRLMs can revise the Price Band by informing the stock exchanges, releasing a press release, disclosure on the website of the members of the Syndicate, if any and notification on the terminal of the members of the Syndicate. In case of a revision in the Price Band, the Issue will be kept open for a period of three working days after the revision of the Price Band, subject to the total Bidding Period not exceeding ten working days. The Company in consultation with BRLMs, can finalise the Issue Price within the Price Band in accordance with this clause, without the prior approval of, or intimation, to the Bidders.

(b) The Bidder can bid at any price within the Price Band. The Bidder has to bid for the desired number of Equity

Shares at a specific price. Retail Individual Bidders may bid at “Cut-off”. However, bidding at “Cut-off” is prohibited for QIB or Non Institutional Bidders and such Bids from QIBs and Non-Institutional Bidders shall be rejected.

(c) Retail Individual Bidders, who bid at the Cut-Off agree that they shall purchase the Equity Shares at any price

within the Price Band. Retail Individual Bidders bidding at Cut-Off shall deposit the Bid Amount based on the Cap Price in the Escrow Account. In the event the Bid Amount is higher than the subscription amount payable by the Retail Individual Bidders (i.e. the total number of Equity Shares allocated in the Issue multiplied by the Issue Price), Retail Individual Bidders shall receive the refund of the excess amounts from the Escrow Account.

(d) The Price Band can be revised during the Bidding Period in which case the maximum revisions on either side of the Price Band shall not exceed 20% fixed initially.

(e) Any revision in the Price Band shall be widely disseminated including by informing the Stock Exchanges,

issuing Press Release and making available this information on the Bidding terminals. (f) In the event of any revision in the Price Band, whether upwards or downwards, the minimum application size

shall remain [●] Equity Shares irrespective of whether the Bid Amount payable on such minimum application is not in the range of Rs. 5,000 to Rs. 7,000.

(g) In case of an upward revision in the Price Band announced as above, Retail Individual Bidders, who had bid at

Cut Off Price could either (i) revise their Bid or (ii) make additional payment based on the cap of the Revised Price Band, with the members of the Syndicate to whom the original Bid was submitted. In case the total amount (i.e. original Bid Amount plus additional payment) exceeds Rs.100,000, the Bid will be considered for allocation under the Non Institutional category in terms of this Draft Red Herring Prospectus. If, however, the Bidder does not either revise the Bid or make additional payment and the Issue Price is higher than the cap of the Price Band prior to revision, the number of Equity Shares bid for shall be adjusted for the purpose of allocation, such that no additional payment would be required from the Bidder and the Bidder is deemed to have approved such revised Bid at Cut off.

(h) In case of a downward revision in the Price Band, announced as above, Retail Individual Bidders who have bid

at Cut Off price could either revise their Bid or the excess amount paid at the time of bidding would be refunded from the Escrow Account

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Escrow Mechanism Escrow Account Our Company shall open Escrow Accounts with one or more Escrow Collection Banks in whose favor the Bidders shall make out the cheque or demand draft in respect of his or her Bid and/or revision of the bid. Cheques or demand drafts received for the full Bid amount from Bidders in a certain category would be deposited in the Escrow Account. The Escrow Collection Banks will act in terms of this Draft Red Herring Prospectus and an Escrow Agreement to be entered into amongst the Company, the BRLMs, Escrow Bankers and Registrar to the Issue. The monies in the Escrow Account shall be maintained by the Escrow Collection Bank(s) for and on behalf of the Bidders. The Escrow Collection Bank(s) shall not exercise any lien whatsoever over the monies deposited therein and shall hold the monies therein in trust for the Bidders. On the Designated Date, the Escrow Collection Banks shall transfer the monies from the Escrow Account to the Issue Account with the Bankers to the Issue as per the terms of the Escrow Agreement. Payments of refunds to the Bidders shall also be made from the Escrow Account as per the terms of the Escrow Agreement and this Draft Red Herring Prospectus. The Bidders should note that the escrow mechanism is not prescribed by SEBI and has been established as an arrangement between the Escrow Collection Bank(s), our Company, the Registrar to the Issue and BRLMs to facilitate collections from the Bidders. Terms of Payment and Payment into the Escrow Account Each Bidder shall, with the submission of the Bid cum Application Form draw a cheque or demand draft in favour of the Escrow Account of the Escrow Collection Bank (for details refer to the paragraph ‘Payment Instructions’ on page no.171 of this Draft Red Herring Prospectus) and submit the same to the member of the Syndicate with whom the Bid is being deposited. Bid cum Application Forms accompanied by cash shall not be accepted. The maximum Bid price has to be paid at the time of submission of the Bid cum Application Form based on the highest bidding option of the Bidder. The members of the Syndicate shall deposit the cheque or demand draft with the Escrow Collection Bank. The Escrow Collection Bank will hold all monies collected for the benefit of the Bidders until the Designated Date. On the Designated Date, the Escrow Collection Bank shall transfer the funds in respect of those Bidders whose Bids have been accepted from the Escrow Account, as per the terms of the Escrow Agreement, into the Public Issue Account. The balance amounts after the transfer to the Public Issue Account, lying credited with the Escrow Collection Banks shall, on the Designated Date be transferred to the Refund Account, held by the Refund Banker for the benefit of the Bidders who are entitled to a refund. No later than 15 days from the Bid/Issue Closing Date, the Refund Banker shall also refund all amounts payable to unsuccessful Bidders and also the excess amount paid on bidding, if any, after adjustment for allocation, to the Bidders. Each category of Bidders (i.e., QIBs, Non Institutional Bidders and Retail Bidders) would be required to pay their applicable Margin Amount at the time of the submission of the Bid-cum-Application Form. The details of the Margin Amount payable is mentioned under the section titled ‘Issue Structure’ on page no. 31 of this Draft Red Herring Prospectus and will be available with the Syndicate and will be as per the Syndicate Agreement. Where the Margin Amount applicable to the Bidder is less than 100% of the Bid Amount, any difference between the amount payable by the Bidder for Equity Shares allocated at the Issue Price and the Margin Amount paid at the time of Bidding, shall be payable by the Bidder no later than the Pay-in-Date, which shall be a minimum period of 2 days from the date of communication of the allocation list to the Syndicate Members by the BRLMs. If the payment is not made favouring the Escrow Account within the time stipulated above, the Bid of the Bidder is liable to be cancelled. However, if the applicable Margin Rate for Bidders is 100%, the full amount of payment has to be made at the time of submission of the Bid Form. The excess amount paid on bidding, if any, after adjustment for allocation, will be refunded to such Bidder as per the modes of payment of refund as detailed in page no. 178 within 15 days from the

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Bid/Issue Closing Date, failing which we shall pay interest at 15% per annum for any delay beyond the periods as mentioned above. Electronic Registration of Bids (a) The members of the Syndicate will register the Bids using the on-line facilities of NSE and BSE. There will be

at least one on-line connectivity to each city where the Bids are accepted. (b) NSE and BSE will offer a screen-based facility for registering Bids for the Issue. This facility will be available

on the terminals of the Syndicate Member and their authorized agents during the Bidding Period. Syndicate Member can also set up facilities for off-line electronic registration of Bids subject to the condition that they will subsequently download the off-line data file into the on-line facilities for book building on a regular basis. On the Bid/Issue Closing Date, the Syndicate Member shall upload the Bids till such time as may be permitted by the Stock Exchanges.

(c) The aggregate demand and price for Bids registered on the electronic facilities of BSE and NSE will be

displayed on-line at all bidding centers and at the website of the BSE and NSE. A graphical representation of consolidated demand and price would be made available at the bidding centers during the Bidding/Issue Period. This information can be accessed on BSE’s website at www.bseindia.com or on NSE’s website at www.nseindia.com.

(d) At the time of registering each Bid, the Syndicate Member shall enter the following details of the investor in the

on-line system: • Name of the investor • Investor Category such as Individual, Corporate, NRI, FII or Mutual Fund, etc. • Numbers of Equity Shares bid for • Bid price • Bid-cum-Application Form number • Whether payment is made upon submission of Bid-cum-Application Form • Depository Participant Identification No. and Client Identification No. of the Demat Account of the Bidder

(e) A system generated TRS will be given to the Bidder as a proof of the registration of each of the bidding options.

It is the Bidder’s responsibility to request and obtain the TRS from the members of the Syndicate. The registration of the Bid by the Syndicate Member does not guarantee that the Equity Shares shall be allocated either by the Syndicate Member or the Company.

(f) Such TRS will be non-negotiable and by itself will not create any obligation of any kind. (g) We, in consultation with the BRLM reserve the right to reject any QIB Bid procured by any or all members of

the Syndicate provided the rejection is at the time of receipt of such Bids and the reason for rejection of the Bid is communicated to the bidder at the time of rejection of bid. In case of Non Institutional Bidders, Retail Bidders and Employees we would have a right to reject the Bids only on technical grounds listed on page no. 174 in this Draft Red Herring Prospectus.

(h) It is to be distinctly understood that the permission given by NSE and BSE to use their network and software of

the Online IPO system should not in any way be deemed or construed to mean that the compliance with various statutory and other requirements by our Company and BRLMs are cleared or approved by NSE and BSE; nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the compliance with the statutory and other requirements nor does it take any responsibility for the financial or other soundness of our Company, our Promoters, our management or any scheme or project of our Company.

(i) It is also to be distinctly understood that the approval given by NSE and BSE should not in any way be deemed

or construed that this Draft Red Herring Prospectus has been cleared or approved by the NSE and BSE; nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this

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Draft Red Herring Prospectus; nor does it warrant that the Equity Shares will be listed or will continue to be listed on the NSE and BSE.

Build Up of the Book and Revision of Bids (a) Bids registered by various Bidders through the members of the Syndicate shall be electronically transmitted to

the NSE or BSE mainframe on a regular basis. b) The book gets built up at various price levels. This information will be available with the BRLMs on a regular

basis.

(h) Only bids that are uploaded on the online IPO system of the NSE and BSE shall be considered for allotment. In case of discrepancy of data between NSE or BSE and the Syndicate Member, the decision of the BRLMs based on physical records of Bid cum Application Forms shall be final and binding to all concerned.

(c) During the Bidding Period, any Bidder who has registered his or her interest in the Equity Shares at a particular

price level is free to revise his or her Bid within the price band using the printed Revision Form, which is a part of the Bid-cum-Application Form.

(d) Revisions can be made in both the desired number of Equity Shares and the bid price by using the Revision

Form. Apart from mentioning the revised options in the revision form, the Bidder must also mention the details of all the options in his or her Bid-cum-Application Form or earlier Revision Form. For example, if a Bidder has bid for three options in the Bid-cum-Application Form and he is changing only one of the options in the Revision Form, he must still fill the details of the other two options that are not being changed, in the Revision Form unchanged. Incomplete or inaccurate Revision Forms will not be accepted by the members of the Syndicate.

(e) The Bidder can make this revision any number of times during the Bidding Period. However, for any revision(s)

of the Bid, the Bidders will have to use the services of the same members of the Syndicate through whom he or he had placed the original Bid. Bidders are advised to retain copies of the blank Revision Form and the revised Bid must be made only in such Revision Form or copies thereof.

(f) Any revision of the Bid shall be accompanied by payment in the form of cheque or demand draft for the

incremental amount, if any, to be paid on account of the upward revision of the Bid. The excess amount, if any, resulting from downward revision of the Bid would be returned to the Bidder at the time of refund in accordance with the terms of this Draft Red Herring Prospectus. In case of QIB Bidders, the members of the Syndicate shall collect the payment in the form of cheque or demand draft for the incremental amount in the QIB Margin Amount, if any, to be paid on account of upward revision of the Bid at the time of one or more revisions by the QIB Bidders.

(g) When a Bidder revises his or her Bid, he or she shall surrender the earlier TRS and get a revised TRS from the

Syndicate Member. It is the responsibility of the Bidder to request for and obtain the revised TRS, which will act as proof of his or her having revised the previous Bid.

Price Discovery and Allocation (a) After the Bid/Issue Closing Date, the BRLMs will analyze the demand generated at various price levels and

discuss pricing strategy with us. (b) Our Company and BRLMs shall finalise the “Issue Price”, the number of Equity Shares to be allotted and the

allocation to successful QIB Bidders. (c) The allocation for QIBs upto 50% of the Issue (including 5% specifically reserved for Mutual Funds) would be

on a proportionate basis in consultation with Designated Stock Exchange subject to valid bids being received at

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or above the Issue Price. The allocation to Non-Institutional Bidders, and Retail Individual Bidders of atleast 15% and 35% of the Issue, respectively, would be on proportionate basis, in consultation with Designated Stock Exchange, subject to valid Bids being received at or above the Issue Price.

(d) Under subscription, if any, in Non-Institutional, QIB and Retail categories would be allowed to be met with spill over from any of the other categories at the discretion of the Company and BRLMs.

(e) Allocation to eligible NRIs or FIIs or Foreign Venture Capital Fund registered with SEBI, applying on

repatriation basis will be subject to the terms and conditions stipulated by RBI. (f) The BRLMs, in consultation with us, shall notify the Syndicate Member of the Issue Price and allocations to

their respective Bidders, where the full Bid Amount has not been collected from the Bidders.

(g) Our Company reserves the right to cancel the Issue any time after the Bid/Issue Opening Date but before allotment.

(h) In terms of SEBI Guidelines, QIB Bidders shall not be allowed to withdraw their Bid after the closure of

Bidding. (i) The allotment details shall be put on the website of the Registrar to the Issue.

Signing of Underwriting Agreement and RoC Filing (a) The Company, the BRLMs and the Syndicate Members shall enter into an Underwriting Agreement on

finalization of the Issue Price and allocation(s) to the Bidders. (b) After signing the Underwriting Agreement, we would update and file the updated Red Herring Prospectus with

RoC, which then would be termed ‘Prospectus’. The Prospectus would have details of the Issue Price, Issue Size, underwriting arrangements and would be complete in all material respects.

Advertisement Regarding Issue Price And Prospectus A statutory advertisement will be issued by us after the filing of the Prospectus with the RoC. This advertisement, in addition to the information that has to be set out in the statutory advertisement, shall indicate the Issue Price. Any material updates between this Draft Red Herring Prospectus and the Prospectus will be included in such statutory advertisement. Issuance of Confirmation of Allocation Note After the determination of Issue Price, the following steps would be taken (a) The BRLMs or Registrar to the Issue shall send to the Syndicate Member a list of their Bidders who have been

allocated Equity Shares in the Issue. (b) The BRLMs or Syndicate Members would then send the CAN to their Bidders who have been allocated Equity

Shares in the Issue. The dispatch of a CAN shall be deemed a valid, binding and irrevocable contract for the Bidder to pay the entire Issue Price for all the Equity Shares allocated to such Bidder. Those Bidders who have not paid into the Escrow Account at the time of bidding shall pay in full the amount payable into the Escrow Account by the Pay-in Date specified in the CAN.

(c) Bidders who have been allocated Equity Shares and who have already paid into the Escrow Account at the time

of bidding shall directly receive the CAN from the Registrar to the Issue subject, however, to realization of their cheque or demand draft paid into the Escrow Account. The dispatch of a CAN shall be a deemed a valid,

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binding and irrevocable contract for the Bidder to pay the entire Issue Price for all the Equity Shares to be allotted to such Bidder.

Designated Date and Allotment of Equity Shares

Investors are advised to instruct their Depository Participant to accept the Equity Shares that may be allocated to them pursuant to this Issue.

d) Do not pay the Bid amount in cash;

(a) After the funds are transferred from the Escrow Account to the Public Issue Account on the Designated Date,

we would ensure allotment of the Equity Shares to the allottees within two days of the finalization and adoption of the basis of allotment.

(b) All allottees will receive credit for the Equity Shares directly in their depository account. Equity Shares will be

issued only in the dematerialized form to the allottees. Allottees will have the option to re-materialize the Equity Shares so allotted, if they so desire, as per the provisions of the Companies Act and the Depositories Act.

We would ensure the allotment of Equity Shares within 15 days of Bid/Issue Closing Date and also ensure that credit is given to the allottees’ depository accounts within two working days from the date of allotment. GENERAL INSTRUCTIONS Do’s: a) Check if you are eligible to apply; b) Complete the Bid-cum-Application Form after reading all the instructions carefully; c) Ensure that the details about Depository Participant and Beneficiary Account are correct as Equity Shares will

be allotted in the dematerialized form only; d) Ensure that the Bids are submitted at the bidding centers only on forms bearing the stamp of a member of the

Syndicate; e) Ensure that you have been given a TRS for all your Bid options; f) Submit Revised Bids to the same member of the Syndicate through whom the Original Bid was placed and

obtain a revised TRS; g) Ensure that the bid is within price band; h) Investors must ensure that the name given in the Bid-cum-Application Form is exactly the same as the name in

which the Depository Account is held. In case, the Bid-cum- Application Form is submitted in joint names, investors should ensure that the Depository Account is also held in the same sequence as they appear in the Bid-cum- Application Form;

i) If your Bid is for Rs. 50,000 or more, ensure that you mention your PAN allotted under the I.T. Act and ensure that you have attached a copy of your PAN card with the Bid cum application Form. In case the PAN has not been allotted, mention “Not Allotted” in the appropriate place.

Don’ts: a) Do not Bid for lower than the minimum Bid size; b) Do not Bid/ revise Bid price to less than the lower end of the price band or higher than the higher end of the

price band; c) Do not Bid on another Bid-cum-Application Form after you have submitted a Bid to the member of the

Syndicate;

e) Do not provide your GIR number instead of your PAN. f) Do not send Bid-cum-Application Forms by post; instead submit the same to members of the Syndicate only;

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g) Do not Bid at cut off price (for QIBs and non-institutional bidders); h) Do not fill up the Bid-cum-Application Form such that the Equity Shares bid for exceeds the Issue size and/ or

investment limit or maximum number of Equity Shares that can be held under the applicable laws or regulations or maximum amount permissible under the applicable regulations; and

i) Do not submit Bid accompanied with Stock invest. Instructions for Completing the Bid-cum-Application Form Bidders can obtain Bid-cum-Application Forms and / or Revision Forms from the BRLMs or Syndicate Member. Bids and Revisions of Bids Bids and revisions of Bids must be: (a) Made only in the prescribed Bid cum Application Form or Revision Form, as applicable (white colour for

Resident Indians and blue colour for NRI or FII or Foreign Venture Capital Fund applying on repatriation basis) (b) Completed in full, in BLOCK LETTERS in ENGLISH and in accordance with the instructions contained

herein, in the Bid-cum-Application Form or in the Revision Form. Incomplete Bid-cum- Application Forms or Revision Forms are liable to be rejected.

(c) The Bids from the Retail Individual Bidders must be for a minimum of [●] Equity Shares and in multiples of

[●] thereafter subject to a maximum Bid amount of Rs. 100,000/-. (d) For Non-institutional and QIB Bidders, Bids must be for a minimum Bid Amount of Rs. [●] and in multiples of

[●] Equity Shares thereafter. All Individual Bidders whose maximum bid amount exceeds Rs. 100,000 would be considered under this category. Bids cannot be made for more than the Issue Size. Bidders are advised to ensure that a single Bid from them should not exceed the investment limits or maximum number of Equity Shares that can be held by them under the applicable laws or regulations.

(e) In single name or in joint names (not more than three). (f) Thumb impressions and signatures other than in the languages specified in the Eighth Schedule in the

Constitution of India must be attested by a Magistrate or a Notary Public or a Special Executive Magistrate under official seal.

Bidder’s Depository Account Details IT IS MANDATORY FOR ALL THE BIDDERS TO GET THEIR EQUITY SHARES IN DEMATERIALISED FORM. ALL BIDDERS SHOULD MENTION THEIR DEPOSITORY PARTICIPANT’S NAME, DEPOSITORY PARTICIPANT IDENTIFICATION NUMBER AND BENEFICIARY ACCOUNT NUMBER IN THE BID CUM APPLICATION FORM. INVESTORS MUST ENSURE THAT THE NAME GIVEN IN THE BID CUM APPLICATION FORM IS EXACTLY THE SAME AS THE NAME IN, WHICH THE DEPOSITORY ACCOUNT IS HELD. IN CASE THE BID CUM APPLICATION FORM 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 BID CUM APPLICATION FORM. Bidders should note that on the basis of name of the Bidders, Depository Participant’s name, Depository Participant- Identification number and Beneficiary Account Number provided by them in the Bid cum Application Form, the Registrar to the Issue will obtain from the Depository demographic details of the Bidders such as address, bank account details for making refunds and occupation (“Demographic Details”). Hence, Bidders are advised to immediately update their bank account details including Magnetic Ink Character Recognition (MICR) Code (a nine digit code appearing on a cheque leaf) as appearing on the records of the depository participant, and carefully fill in their Depository Account details in the Bid cum Application Form. Please note that failure to do so could result in delays in credit of refunds to Bidders at the

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Bidders sole risk and neither the BRLMs nor the Company nor the Refund Banker nor the Registrar shall have any responsibility and undertake any liability for the same. These Demographic Details would be used for all correspondence with the Bidders including mailing of the CANs/Allocation Advice and making refunds as per the modes disclosed and the Demographic Details given by Bidders in the Bid cum Application Form would not be used for these purposes by the Registrar. Hence, Bidders are advised to update their Demographic Details as provided to their Depository Participants and ensure that they are true and correct. By signing the Bid cum Application Form, Bidder would have deemed to authorize the depositories to provide, upon request, to the Registrar to the Issue, the required Demographic Details as available on its records. Allocation Advice/CANs/ refund orders/ refund advice would be mailed at the address of the Bidders as per the Demographic Details received from the Depositories. Bidders may note that delivery of allocation advice/CANs/ refund orders/ refund advice may get delayed if the same once sent to the address obtained from the Depositories are returned undelivered. In the case of refunds through electronic modes as detailed in page no. 179 of this Draft Red Herring Prospectus, Bidders may note that refund may get delayed if the bank particulars obtained from the Depositories are incorrect. In case no corresponding record is available with the Depositories that matches three parameters, namely, names of the Bidders (including the order of names of joint holders), the Depository Participant’s identity (DP ID) and the beneficiary’s identity, then such Bids are liable to be rejected. Bids under Power of Attorney In case of Bids made pursuant to a Power of Attorney or by limited companies, corporate bodies, registered societies, a certified copy of the Power of Attorney or the relevant resolution or authority, as the case may be, along with a certified copy of the Memorandum and Articles of Association and/or Bye Laws must be lodged along with the Bid-cum-Application Form. Failing this, the Company reserves the right to accept or reject any Bid in whole or in part, in either case, without assigning any reason therefore. In case of Bids made pursuant to a power of attorney by FIIs, a certified copy of the power of attorney or the relevant resolution or authority, as the case may be, along with a certified copy of their SEBI registration certificate must be lodged along with the Bid cum Application Form. Failing this, our Company reserves the right to accept or reject any Bid in whole or in part, in either case, without assigning any reason therefore. In case of Bids made by Insurance Companies registered with the Insurance Regulatory and Development Authority, a certified copy of certificate of registration issued by Insurance Regulatory and Development Authority must be lodged along with the Bid-cum-Application Form. Failing this, our Company reserves the right to accept or reject any Bid in whole or in part, in either case, without assigning any reason therefore. In case of Bids made by provident funds with minimum corpus of Rs. 250 million and pension funds with minimum corpus of Rs. 250 million, a certified copy of certificate from a chartered accountant certifying the corpus of the provident fund/ pension fund must be lodged along with the Bid-cum-Application Form. Failing this, our Company reserves the right to accept or reject any Bid in whole or in part, in either case, without assigning any reason therefore. We, in our absolute discretion, reserve the right to relax the above condition of simultaneous lodging of the Power of Attorney along with the Bid-cum-Application form, subject to such terms that we may deem fit. Bids by NRIs NRI bidders to comply with the following:

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• Individual NRI bidders can obtain the Bid cum Application Forms from our Registered Office, C-28, Housing Society, South Extension Part- I, New Delhi- 110 049 or the Registrars to the Issue or Syndicate Member.

• NRI bidders may please note that only such bids as are accompanied by payment in free foreign exchange shall

be considered for allotment under the NRI category. The NRIs who intend to make payment through Non-Resident Ordinary (NRO) accounts shall use the form meant for resident Indians.

Bids by Eligible NRIs and FIIs on a repatriation basis

Bids by NRIs for a Bid Amount of up to or less than Rs. 100,000 would be considered under the Retail Individual Bidders Portion for the purposes of allocation and Bids for a Bid Amount of more than Rs. 100,000/- would be considered under Non Institutional Bidder Portion for the purposes of allocation; by FIIs or Foreign Venture Capital Fund registered with SEBI for a minimum of such number of Equity Shares and in multiples of [●] Equity Shares thereafter so that the Bid Amount exceeds Rs. 100,000; for further details see “- Maximum and Minimum Bid Size”.

Refunds, dividends and other distributions, if any, will be payable in Indian Rupees only and net of bank charges and / or commission. In case of Bidders who remit money payable upon submission of the Bid-cum- Application Form or Revision Form through Indian Rupee drafts purchased abroad, such payments in Indian Rupees will be converted into US Dollars or any other freely convertible currency as may be permitted by the RBI at the rate of exchange prevailing at the time of remittance and will be dispatched by registered post/speed post. We will not be responsible for loss, if any, incurred by the Bidder on account of conversion of foreign currency.

Bids and revision to Bids must be made: On the Bid cum Application Form or the Revision Form, as applicable (blue in color), and completed in full in BLOCK LETTERS in ENGLISH in accordance with the instructions contained therein. In a single name or joint names (not more than three). By FIIs for a minimum of such number of Equity Shares that the Bid Amount exceeds Rs. 100,000/- and in multiples of [•] Equity Shares thereafter. For further details, please refer to the section titled ‘Issue Procedure - Maximum and Minimum Bid Size’ on page no. 161 of this Draft Red Herring Prospectus.

In the names of individuals or in the names of FIIs or in the names of Foreign Venture Capital Fund registered with SEBI but not in the names of minors, firms or partnerships, foreign nationals or their nominees or OCBs.

It is to be distinctly understood that there is no reservation for eligible NRIs and FIIs. All eligible NRIs and FIIs will be treated on the same basis with other categories for the purpose of allocation. Payment Instructions

We shall open an Escrow Account with the Escrow Collection Bank(s) for the collection of the Bid Amounts payable upon submission of the Bid-cum-Application Form and for amounts payable pursuant to allocation in the Issue. Each Bidder shall draw a cheque or demand draft for the amount payable on the Bid and/or on allocation as per the following terms:

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Payment into Escrow Account: (a) The Bidders for whom the applicable margin is equal to 100% shall, with the submission of the Bid- cum-

Application Form draw a payment instrument for the Bid Amount in favor of the Escrow Account and submit the same to the members of the Syndicate.

(b) In case the above Margin Amount paid by the Bidders during the Bidding Period is less than the Issue Price

multiplied by the Equity Shares allocated to the Bidder, the balance amount shall be paid by the Bidders into the Escrow Account within the period specified in the CAN which shall be subject to a minimum period of two days from the date of communication of the allocation list to the Syndicate Member by the BRLMs.

(c) The payment instruments for payment into the Escrow Account should be drawn in favor of:

(i) In case of QIBs: "Escrow Account - Indo Asia Leisure Services Issue – QIB-R" (ii) In case of non resident QIB Bidders: “Escrow Account- Indo Asia Leisure Services Issue Public

Offer – QIB-NR” (iii) In case of Resident Retails and Non Institutional Bidders: “Escrow Account – Indo Asia Leisure

Services Issue Public Offer” (iv) In case of Non Resident Retail and Non Institutional Bidders: “Escrow Account – Indo Asia Leisure

Services Issue Public Offer – NR” (d) In case of Bids by NRIs applying on repatriation basis, the payments must be made through Indian Rupee

Drafts purchased abroad or cheques or bank drafts, for the amount payable on application remitted through normal banking channels or out of funds held in Non-Resident External (NRE) Accounts or Foreign Currency Non-Resident (FCNR) Accounts, maintained with banks authorized to deal in foreign exchange in India, along with documentary evidence in support of the remittance. Payment will not be accepted out of a Non-Resident Ordinary (NRO) Account of a Non-Resident bidder bidding on a repatriation basis. Payment by drafts should be accompanied by a bank certificate confirming that the draft has been issued by debiting an NRE or FCNR Account.

(e) In case of Bids by FIIs, the payment should be made out of funds held in a Special Rupee Account along with

documentary evidence in support of the remittance. Payment by drafts should be accompanied by a bank certificate confirming that the draft has been issued by debiting the Special Rupee Account.

(f) Where a Bidder has been allocated a lesser number of Equity Shares than the Bidder has Bid for, the excess

amount, if any, paid on bidding, after adjustment towards the balance amount payable on the Equity Shares allocated, will be refunded to the Bidder by the Refund Banker from the Refund Account.

(g) The monies deposited in the Escrow Account will be held for the benefit of the Bidders until Designated Date. (h) On the Designated Date, the Escrow Collection Banks shall transfer the funds from the Escrow Account as per

the terms of the Escrow Agreement into the Issue Account with the Bankers to the Issue. Further, on the Designated Date, the Escrow Collection Banks shall transfer all amounts liable to be refunded to unsuccessful bidders and the excess amounts paid on Bidding to the Refund Account held by the Refund Banker for the benefit of the Bidders entitled to a refund..

(i) On the Designated Date and no later than 15 days from the Bid/Issue Closing Date, the Refund Banker shall,

from the Refund Account, refund all amounts payable to unsuccessful bidders and also the excess amount paid on Bidding, if any.

Payments should be made by cheque, or demand draft drawn on any bank (including a Co-operative bank), which is situated at, and is a member of or sub-member of the bankers’ clearing house located at the center where the Bid cum Application Form is submitted. Outstation cheques/bank drafts drawn on banks not participating in the clearing process will not be accepted and applications accompanied by such cheques or bank drafts are liable to be rejected. Cash/ stock invest/money orders/ postal orders will not be accepted.

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Payment by Stock invest In terms of Reserve Bank of India Circular No. DBOD No. FSC BC 42/24.47.001/2003-04 dated November 5, 2003, the option to use the stock invest instrument in lieu of cheques or bank drafts for payment of bid money has been withdrawn. Submission of Bid-cum-Application Form All Bid-cum-Application Forms or Revision Forms duly completed and accompanied by account payee cheques or drafts shall be submitted to the Syndicate Member at the time of submission of the Bid. No separate receipts shall be issued for the money payable on the submission of Bid-cum-Application Form or Revision Form. However, the collection center of the Syndicate Member will acknowledge the receipt of the Bid-cum-Application Forms or Revision Forms by stamping and returning to the Bidder the acknowledgement slip. This acknowledgement slip will serve as the duplicate of the Bid-cum-Application Form for the records of the Bidder. OTHER INSTRUCTIONS Joint Bids in the case of Individuals

Bids may be made in single or joint names (not more than three). In the case of joint Bids, all payments will be made out in favor of the Bidder whose name appears first in the Bid-cum-Application Form or Revision Form (“First Bidder”). All communications will be addressed to the First Bidder and will be dispatched to his or her address.

Multiple Bids A Bidder should submit only one Bid (and not more than one) for the total number of Equity Shares required. Two or more Bids will be deemed to be multiple Bids if the sole or First Bidder is one and the same. In case of a mutual fund, a separate Bid can be made in respect of each scheme of the mutual fund registered with SEBI and such Bids in respect of more than one scheme of the mutual fund will not be treated as multiple bids provided that the Bids clearly indicate the scheme concerned for which the Bid has been made. We reserve the right to reject, in our absolute discretion to accept or reject, all or any multiple Bids in any or all categories. Permanent Account Number (PAN) Where Bid(s) is/are for Rs. 50,000/- or more, the Bidder or in the case of an Bid in joint names, each of the Bidders, should mention his/her Permanent Account Number (PAN) allotted under the I.T. Act. The copy of the PAN card or PAN allotment letter is required to be submitted with the Bid Cum Application form. Applications without this information and documents will be considered incomplete and are liable to be rejected. It is to be specifically noted that Bidders should not submit the GIR number instead of the PAN as the Bid is liable to be rejected on this ground. In case the Sole/First Bidder and Joint Bidder(s) is/are not required to obtain PAN, each of the Bidder(s) shall mention “Not Applicable” and in the event that the sole Bidder and/or the joint Bidder(s) have applied for PAN which has not yet been allotted each of the Bidder(s) should mention “Applied for” in the Bid cum Application Form. Further, where the Bidder(s) has mentioned “Applied for” or “Not Applicable”, the Sole/First Bidder and each of the Joint Bidder(s), as the case may be, would be required to submit Form 60 (Form of declaration to be filed by a person who does not have a permanent account number and who enters into any transaction specified in rule 114B), or, Form 61 (form of declaration to be filed by a person who has agricultural income and is not in receipt of any other income chargeable to income-tax in respect of transactions specified in rule 114B), as may be applicable, duly filled along with a copy of any one of the following documents in support of the address: (a) Ration Card (b) Passport (c) Driving License (d) Identity Card issued by any institution (e) Copy of the electricity bill or telephone bill showing residential address (f) Any document or communication issued by any authority of the Central Government, State Government or local bodies showing residential address (g) Any other documentary evidence in support of address given in the declaration. It may be noted that Form 60 and Form 61 have been

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amended vide a notification issued on December 1, 2004 by the Ministry of Finance, Department of Revenue, Central Board of Direct Taxes. All Bidders are requested to furnish, where applicable, the revised Form 60 or 61 as the case may be. Unique Identification Number - MAPIN

With effect from July 1, 2005, SEBI has decided to suspend all fresh registrations for obtaining Unique Identification Number (UIN) and the requirement to contain/quote UIN under the MAPIN Regulations/ Circulars vide its circular MAPIN/Cir- 13/2005. Our Right to Reject Bids We and the BRLM reserve the right to reject any QIB Bid provided the rejection is at the time of receipt of Bid and the reason for rejection of the Bid is communicated to the Bidder at the time of rejection of Bid.. In case of Non-Institutional Bidders and Retail Individual Bidders, we and the BRLMs have a right to reject bids based on technical grounds. Consequent refunds shall be made as per the modes disclosed. Grounds for Technical Rejections

Bidders are advised to note that Bids are liable to be rejected among others on the following technical grounds: 1) Amount paid doesn’t tally with the highest number of Equity Shares bid for; 2) Age of First Bidder not given; 3) Bids by Persons not competent to contract under the Indian Contract Act, 1872, including minors, insane

Persons; 4) PAN not given if Bid is for Rs. 50,000 or more and GIR number given instead of PAN number; 5) Bids for lower number of Equity Shares than specified for that category of investors; 6) Bids at a price less than lower end of the Price Band; 7) Bids at a price more than the higher end of the Price Band; 8) Bids at cut-off price by Non-Institutional and QIB Bidders; 9) Bids for number of Equity Shares which are not in multiples of [●]; 10) Category not ticked; 11) Multiple bids as defined in this Draft Red Herring Prospectus; 12) In case of Bid under power of attorney or by limited companies, corporate, trust etc., relevant documents are not

submitted; 13) Bids accompanied by Stock invest/ money order/postal order/cash; 14) Signature of sole and / or joint bidders missing; 15) Bid-cum-Application Form does not have the stamp of the BRLMs or Syndicate Member; 16) Bid-cum-Application Form does not have Bidder’s depository account details; 17) In case no corresponding record is available with the Depository that matches three parameters: name of Bidder

(including sequence of names of joint holders), depository participant identification number and beneficiary account number;

18) Bid-cum-Application Forms are not delivered by the Bidders within the time prescribed as per the Bid-cum-Application Form, Bid/Issue Opening Date advertisement and this Draft Red Herring Prospectus and as per the instructions in this Draft Red Herring Prospectus and the Bid-cum-Application Form;

19) Bids by QIBs not submitted through IDBI Capital Market Services Limited and Chartered Capital and Investment Limited.

20) Bids for amounts greater than the maximum permissible amounts prescribed by the regulations; 21) Bids by OCBs; and 22) Bid by U.S. residents or U.S persons other than “Qualified Institutional Buyers” as defined in Rule 144A of the

U.S. Securities Act of 1933.

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Equity Shares in Dematerialized Form with NSDL or CDSL As per the provisions of Section 68B of the Companies Act, the Equity Shares in this Issue shall be allotted only in a dematerialized form, (i.e. not in the form of physical certificates but be fungible and be represented by the statement issued through the electronic mode). In this context, two agreements have been signed among us, the respective Depositories and the Registrar to the Issue: a) a tripartite agreement dated [●] with NSDL, us and Registrar to the Issue; b) a tripartite agreement dated [●] with CDSL, us and Registrar to the Issue. All bidders can seek allotment only in dematerialized mode. Bids from any investor without relevant details of his or her depository account are liable to be rejected. a) A Bidder applying for Equity Shares must have at least one beneficiary account with either of the Depository

Participants of either NSDL or CDSL prior to making the Bid. b) The Bidder must necessarily fill in the details (including the Beneficiary Account Number and Depository

Participant’s Identification number) appearing in the Bid-cum-Application Form or Revision Form. c) Equity Shares allotted to a successful Bidder will be credited in electronic form directly to the beneficiary

account (with the Depository Participant) of the Bidder d) Names in the Bid-cum-Application Form or Revision Form should be identical to those appearing in the

account details in the Depository. In case of joint holders, the names should necessarily be in the same sequence as they appear in the account details in the Depository.

e) Non-transferable allotment advice will be directly sent to the Bidder by the Registrar to this Issue. Refunds will be made directly by the Registrar to the Issue as per the modes disclosed.

f) If incomplete or incorrect details are given under the heading ‘Request for Equity Shares in electronic form’ in the Bid-cum-Application Form or Revision Form, it is liable to be rejected.

g) The Bidder is responsible for the correctness of his or her demographic details given in the Bid-cum-Application Form vis-à-vis those with his or her Depository Participant.

h) It may be noted that Equity Shares in electronic form can be traded only on the stock exchanges having electronic connectivity with NSDL and CDSL. All the Stock Exchanges where our Equity Shares are proposed to be listed have electronic connectivity with CDSL and NSDL.

i) The trading of the Equity Shares of the Company would be in dematerialized form only for all investors. Communications

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

All future communications in connection with Bids made in this Issue should be addressed to the Registrar to the Issue quoting the full name of the sole or First Bidder, Bid-cum-Application Form number, number of Equity Shares applied for, date, bank and branch where the Bid was submitted and cheque, number and issuing bank thereof. Impersonation

“Any person who: (a) makes in a fictitious name, an application to a company for acquiring or subscribing for, any shares therein, or (b) otherwise induces a company to allot, or register any transfer of shares therein to him, or any other person in a

fictitious name, shall be punishable with imprisonment for a term which may extend to five years.” Basis of Allotment or Allocation For Retail Individual Bidders

Bids received from the Retail Individual Bidders at or above the Issue Price shall be grouped together to

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determine the total demand under this category. The allotment to all the successful Retail Individual Bidders will be made at the Issue Price.

The Issue Size less allotment to Non-Institutional and QIB Bidders shall be available for allotment to Retail

Individual Bidders who have bid in the Issue at a price that is equal to or greater than the Issue Price. If the aggregate demand in this category is less than or equal to 30,00,200 Equity Shares at or above the Issue

Price, full allotment shall be made to the Retail Individual Bidders to the extent of their demand. If the aggregate demand in this category is greater than 30,00,200 Equity Shares at or above the Issue Price, the

allotment shall be made on a proportionate basis up to 30,00,200 Equity Shares. For the method of proportionate basis of allotment, refer below.

For Non-Institutional Bidders Bids received from Non-Institutional Bidders at or above the Issue Price shall be grouped together to determine

the total demand under this category. The allotment to all successful Non-Institutional Bidders will be made at the Issue Price.

The Issue Size less allotment to QIBs and Retail Portion shall be available for allotment to Non-Institutional

Bidders who have bid in the Issue at a price that is equal to or greater than the Issue Price. If the aggregate demand in this category is less than or equal to 12,85,800 Equity Shares at or above the Issue

Price, full allotment shall be made to Non-Institutional Bidders to the extent of their demand. In case the aggregate demand in this category is greater than 12,85,800 Equity Shares at or above the Issue

Price, allotment shall be made on a proportionate basis up to a 12,85,800 Equity Shares. For the method of proportionate basis of allotment refer below.

For QIBs Bids received from the QIB Bidders at or above the Issue Price shall be grouped together to determine the total

demand under this portion. The allotment to all the QIB Bidders will be made at the Issue Price. The QIB Portion shall be available for allotment to QIB Bidders who have bid in the Issue at a price that is

equal to or greater than the Issue Price.

Allotment shall be undertaken in the following manner:

(a) In the first instance allocation to Mutual Funds for up to 5% of the QIB Portion shall be determined as

follows:

(i) In the event that Mutual Fund Bids exceeds 5% of the QIB Portion, allocation to Mutual Funds shall be done on a proportionate basis for up to 5% of the QIB Portion.

(ii) In the event that the aggregate demand fom Mutual Funds is less than 5% of the QIB Portion then all

Mutual Funds shall get full allotment to the extent of valid bids received above the Issue Price. (iii) Equity Shares remaining unsubscribed, if any, not allocated to Mutual Funds shall be available for

allotment to all QIB Bidders as set out in (b) below; (b) In the second instance allotment to all QIBs shall be determined as follows:

(i) In the event that the oversubscription in the QIB Portion, all QIB Bidders who have submitted Bids

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above the Issue Price shall be allotted Equity Shares on a proportionate basis for up to 95% of the QIB Portion.

(ii) Mutual Funds, who have received allocation as per (a) above, for less than the number of Equity

Shares Bid for by them, are eligible to receive Equity Shares on a proportionate basis along with other QIB Bidders.

(iii) Under-subscription below 5% of the QIB Portion, if any, from Mutual Funds, would be included for

allocation to the remaining QIB Bidders on a proportionate basis.

Except for any shares allocated to QIB Bidders due to undersubscription in the Retail Portion and/or Non Institutional Portion, the aggregate allocation to QIB Bidders shall be made on a proportionate basis up to 42,86,000 Equity Shares. For the method of proportionate basis of allocation refer below. Method of proportionate basis of allotment in the QIB, Retail and Non-Institutional portions

In the event of the Issue being over-subscribed, we shall finalise the basis of allotment in consultation with the Designated Stock Exchange. The Executive Director (or any other senior official nominated by them) of the Designated Stock Exchange along with the BRLMs and the Registrar to the Issue shall be responsible for ensuring that the basis of allotment is finalised in a fair and proper manner.

The allotment shall be made in marketable lots, on a proportionate basis as explained below:

Bidders will be categorised according to the number of Equity Shares applied for.

The total number of Equity Shares to be allotted to each category as a whole shall be arrived at on a

proportionate basis, which is the total number of Equity Shares applied for in that category (number of Bidders in the category multiplied by the number of Equity Shares applied for) multiplied by the inverse of the over-subscription ratio.

Number of Equity Shares to be allotted to the successful Bidders will be arrived at on a proportionate basis,

which is total number of Equity Shares applied for by each Bidder in that category multiplied by the inverse of the over-subscription ratio.

In all Bids where the proportionate allotment is less than [•] Equity Shares per Bidder, the allotment shall be

made as follows:

Each successful Bidder shall be allotted a minimum of [•] Equity Shares; and The successful Bidders out of the total Bidders for a category shall be determined by draw of lots in a

manner such that the total number of Equity Shares allotted in that category is equal to the number of Equity Shares calculated in accordance with (b) above.

If the proportionate allotment to a Bidder is a number that is more than [•] but is not a multiple of one (which is

the marketable lot), the number in excess of the multiple of one would be rounded off to the higher multiple of one if that number is 0.5 or higher. If that number is lower than 0.5, it would be rounded off to the lower multiple of one. All Bidders in such categories would be allotted Equity Shares arrived at after such rounding off.

If the Equity Shares allocated on a proportionate basis to any category are more than the Equity Shares allotted to the Bidders in that category, the remaining Equity Shares available for allotment shall be first adjusted against any other category, where the allotted shares are not sufficient for proportionate allotment to the successful Bidders in

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that category. The balance Equity Shares, if any, remaining after such adjustment will be added to the category comprising Bidders applying for minimum number of Equity Shares. Letters of allotment or refund orders The Company shall give credit to the beneficiary account with Depository Participants within two working days from the date of the allotment of Equity Shares. Applicants having bank accounts at any of the 15 centres where clearing houses are managed by the Reserve Bank of India (RBI) will get refunds through Electronic Credit Service (ECS) only, except where applicant is otherwise disclosed as eligible to get refunds through direct credit or Real Time Gross Settlement (RTGS). In case of other applicants, the Company shall ensure dispatch of refund orders, if any, of value up to Rs. 1,500 by “Under Certificate of Posting”, and shall dispatch refund orders of Rs. 1,500 and above, if any, by registered post or speed post. Applicants to whom refunds are made through Electronic transfer of funds will be sent a letter (refund advice) through “Under Certificate of Posting” intimating them about the mode of credit of refund within 15 days of closure of Issue. The Company shall ensure dispatch of refund orders/refund advice, if any, by “Under Certificate of Posting” or registered post or speed post or Electronic Clearing Service or Direct Credit or RTGS, as applicable, only at the sole or First Bidder’s sole risk within 15 days of the Bid Closing Date/Issue Closing Date, and adequate funds for making refunds to unsuccessful applicants as per the mode(s) disclosed shall be made available to the Registrar by the Issuer.

In accordance with the requirements of the Stock Exchanges and SEBI Guidelines, the Company undertakes that:

• Allotment shall be made only in dematerialised form within 15 days from the Issue Closing Date; • Dispatch of refund orders/ refund advice shall be done within 15 days from the Issue Closing Date; and • The Company shall pay interest at 15.0% per annum (for any delay beyond the 15-day time period as mentioned

above), if allotment is not made, refund orders/ credit intimation are not dispatched and in case where a refund is made through electronic mode, the refund instructions have not been given to the clearing system, and demat credit within the 15-day time prescribed above, provided that the beneficiary particulars relating to such Bidders as given by the Bidders is valid at the time of the upload of the electronic transfer.

The Company will provide adequate funds required for the cost of despatch of refund orders/ refund advice/ allotment advice to the Registrar to the Issue. Save and except refunds effected through the electronic mode i.e. ECS, direct credit or RTGS, refunds will be made by cheques, pay orders or demand drafts drawn on the Refund Bank and payable at par at places where Bids are received. The bank charges, if any, for encashing such cheques, pay orders or demand drafts at other centres will be payable by the Bidders. Payment of Refund Bidders should note that on the basis of name of the Bidders, Depository Participant’s name, Depository Participant-Identification (DP ID) number and Beneficiary Account Number provided by them in the Bid cum Application Form, the Registrar to the Issue will obtain from the Depository, the Bidders bank account details including the nine digit Magnetic Ink Character Recognition (MICR) code as appearing on a cheque leaf. Hence, Bidders are advised to immediately update their bank account details as appearing on the records of the depository participant. Please note that failure to do so could result in delays in credit of refunds to Bidders at the Bidders sole risk and neither the BRLMs nor the Company nor the Refund Banker nor the Registrar shall have any responsibility and undertake any liability for the same.

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Mode of Making Refunds The payment of refund, if any, would be done through various modes in the following order of preference

I. ECS - Payment of refund would be done through ECS for applicants having an account at any of the 15 centres where clearing houses for ECS are managed by Reserve Bank of India, namely Ahmedabad, Bangalore, Bhubneshwar, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Kanpur, Kolkata, Mumbai, Nagpur, New Delhi, Patna and Thiruvananthapuram. 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 15 centres named hereinabove, except where applicant is otherwise disclosed as eligible to get refunds through direct credit or RTGS

II. Direct Credit – Applicants having their bank account with the Refund Banker, i.e. [•] shall be eligible to receive refunds, if any, throught direct credit. The refund amount, if any would be credited directly to the eligible applicant’s bank account with the Refund Banker.

III. RTGS – Applicants having a bank account at any of the 15 centres detailed above, and whose bid 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 Bid cum Application form. In the event of failure to provide the IFSC code in the Bid cum Application form, the refund shall be made through the ECS or direct credit, if eligibility disclosed.

Please note that only applicants having a bank account at any of the 15 centres where clearing houses for ECS are managed by the RBI are eligible to receive refunds through the modes detailed in I,II and III hereinabove. For all the other applicants, including applicants who have not updated their bank particulars along with the nine digit MICR Code, the refund orders would be despatched “Under Certificate of Posting” for refund orders of value up to Rs. 1,500 and through Speed Post/Registered Post for refund orders of Rs. 1,500 and above. Interest in case of delay in dispatch of allotment letters/making refunds We agree that allotment of securities offered to the public shall be made not later than 15 days from the Bid/Issue Closing Date. We further agree that we shall pay interest at 15% per annum if the allotment letters/refunds orders have not been dispatched to the applicants within 15 days of the Bid/ Issue Closing Date or if in a case where refund or portion thereof is made in an electronic manner, the refund instructions have not been given to the clearing system in a disclosed manner within 15 days from the Bid/Issue Closing Date, provided that the beneficiary particulars relating to such Bidders as given by the Bidders is valid at the time of the upload of the electronic transfer. In case of revision in the Price Band, the Bidding/Issue Period will be extended for three additional days after revision of Price Band. Any revision in the Price Band and the revised Bid/Issue Period, if applicable, will be widely disseminated by notification to the BSE and NSE, by issuing a press release, and also by indicating the change on the web site of the BRLMs and at the terminals of the Syndicate. Undertaking by the Company We undertake as follows:

that the complaints received in respect of this Issue shall be attended to expeditiously and satisfactorily; • • that all steps will be taken for the completion of the necessary formalities for listing and commencement of

trading at all the stock exchanges where the Equity Shares are proposed to be listed within seven working days of finalization of the basis of allotment;

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•

•

•

•

The Board of Directors of our Company certifies that:

that the funds required for making refunds to unsuccessful applicants as per the modes disclosed shall be made available to the Registrar to the Issue by us; that where refunds are effected through electronic transfer of funds, a suitable communication shall be sent to the applicant within 15 days of closure of the Issue giving details of the bank where refunds shall be credited along with the amount and expected date of electronic credit of the refund. that no further issue of Equity Shares shall be made till the Equity Shares issued through this Prospectus are listed or until the bid monies are refunded on account of non-listing, under-subscription etc. refunds shall be made as per the modes disclosed and allotment advice shall be dispatched to NRIs or FIIs or foreign venture capital investors registered with SEBI within the specified time.

Utilization of Issue proceeds

(a) all monies received out of the Issue shall be transferred to a separate Bank Account other than the bank account

referred to in sub-section (3) of Section 73 of the Companies Act; (b) details of all monies utilized out of this Issue referred above shall be disclosed under an appropriate separate

head in the balance sheet of the Company indicating the purpose for which such unutilized monies have been invested; and

(c) Details of all unutilized monies out of this Issue, if any, shall be disclosed under an appropriate separate head in the balance sheet of our Company indicating the form in which such unutilized monies have been invested.

We shall not have recourse to the Issue Proceeds until the approval for listing and trading of the Equity Shares from all the Stock Exchanges where listing is sought has been received. The details of all unutilized monies out of the funds received under the reservations shall be disclosed under a separate head in the balance sheet of the Company indicating then form in which such unutilized monies have been invested. RESTRICTIONS ON FOREIGN OWNERSHIP OF INDIAN SECURITIES Foreign investment in Indian securities is regulated through the Industrial Policy, 1991 of the Government of India and FEMA. While the Industrial Policy, 1991 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 the 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. No person shall make a Bid in pursuance of this Issue unless such person is eligible to acquire Equity Shares of our Company in accordance with applicable laws, rules, regulations, guidelines and approvals. Investors making a bid in response to the Issue will be required to confirm and will be deemed to have represented to our Company, the BRLMs, the Underwriters and their respective directors, officers, agents, affiliates and representatives that they are eligible under all applicable laws, rules, regulations, guidelines and approvals to subscribed to the Equity Shares of our Company and will not offer, sell, pledge or transfer the Equity Shares of our Company to any person who is not eligible under applicable laws, rules, regulations, guidelines and approvals to acquire Equity Shares of our Company. Our Company, the BRLMs, the Underwriters and their respective directors, officers, agents, affiliates and representatives accept no responsibility or liability for advising any investor whether such investor is eligible to subscribe to Equity Shares of our Company.

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Investment by FIIs Under present regulations, the maximum permissible FII investment in our Company is restricted to 24% of our total issued capital. This can be raised to 100% by adoption of a Board resolution and special resolution by our shareholders; however, as of the date hereof, no such resolution has been recommended to Board or our shareholders for adoption. By way of Circular No. 53 dated December 17, 2003, the RBI has permitted FIIs to subscribe to shares of an Indian company in a public Issue without prior RBI approval, so long as the price of Equity Shares to be issued is not less than the price at which Equity Shares are issued to residents. The allotment/ transfer of Equity Shares of NRIs, FIIs, Foreign Venture Capital Investors registered with SEBI shall be subject to the conditions as may be prescribed by the government of India or RBI while granting such approvals.

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SECTION VIII – MAIN PROVISION OF THE ARTICLES OF ASSOCIATION

Pursuant to Schedule II of the Companies Act and the SEBI Guidelines, the main provisions of the of the Articles of Association relating to voting rights, dividend, lien, forfeiture, restrictions on transfer and transmission of Equity Shares or debentures and/or on their consolidation/splitting as detailed below. Please note that the each provision herein below is numbered as per the corresponding article number in the Articles of Association and defined terms herein have the meaning given to them in the Articles of Association.

2. The Regulations contained in Table A in Schedule 1 to the Companies Act 1956 shall not apply to the

Company and the Regulations herein contained shall be the regulations for the management of the Company and for the observance of its members and their representatives. They shall be binding on the Company and its members as if they are the terms of an agreement between them.

SHARE CAPITAL

3. The Authorised Share Capital of the company shall be such amounts and be divided into such shares as may,

from time to time, be provided in Clause V of the Memorandum of Association with power to increase or reduce the capital in accordance with the Company's regulations and legislative provisions for the time being in force on that behalf with the powers to divide the share capital. Whether original or increased or decreased into several classes and attach there to respectively such ordinary, preferential or special rights and conditions in such a manner as may for the time being be provided by the Regulations of the Company and allowed by law. The minimum paid up capital of the Company shall be Rs. 9,00,00,000/- (Rupees Nine Crores).

4. Subject to the provisions of these Articles and of the Act, the shares shall be under the control of the Board

of Directors, who may allot or otherwise dispose of the same to such persons, on such terms and conditions and at such time as they think fit and with full power to give any persons the option to call of or be allotted shares of the Company of any class, either at a premium or at par or at a discount and for such time and for such consideration as the Board of Directors think fit (subject to the provisions of Section 78 and 79 of the Act), provided that option or right to call of shares shall not be given to any person except with the sanction of the Company in General Meeting. The Board shall cause to be made the returns as the allotment provided for in Section 75 of the Act.

5. Any application signed by or on behalf of an applicant for shares in the Company, followed by an allotment

of any shares, therein, shall be an acceptance of shares within the meaning of these Articles; and every person who thus or otherwise accepts any shares and whose name is on the register shall, for the purposes of the Articles, be a member.

6. (1) If at any time the share capital is divided into different classes of shares, the rights attached to any class

(unless otherwise provided by the terms of issue of the shares of that class) may, subject to the provisions of Sections 106 and 107 of the Act and whether or not the Company is being wound up be varied with the consent in writing of the holders of three fourths of the issued shares of that class or with a sanction of a resolution passed at a separate meeting of the holders of the shares of that class.

(2) Subject to the provisions of Section 170 (2) (a) and (b) of the Act, to every such separate meeting, the provisions of these regulations relating to meetings shall mutatis mutandis apply, but so that the necessary quorum shall be five persons at least holding or representing by proxy or one-third of the issued shares of the class in question.

7. The rights conferred upon the holders of the shares of any class issued with preferred or other rights shall not

unless otherwise provided by the terms of issue of the shares of that class be deemed to be varied by the creation or issue of further shares ranking pari passu therewith.

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8. (1) The Company may exercise the powers of paying commissions offered by Section 76 of the Act, provided that the rate percent or the amount of the commission paid or agreed to be paid shall be disclosed in the manner required by the Section.

(2) The rate of commission shall not exceed the rate of 5% (five percent) of the price at which the shares in respect whereof the same is paid are issued or an amount equal to 5% (five percent) of such price, as the case may be and in the case of debentures 2-1/2% (two and a half percent) of the price at which the debentures in respect whereof the same is paid are issued or an amount equal to 2-1/2% (two and a half percent) of such price, as the case may be.

(3) The commission may be satisfied by payment in cash or by allotment of fully or partly paid shares or partly in one way and partly in the other.

(4) The Company may also, on any issue of shares, pay such brokerage as may be lawful. 9. Subject to section 187-C of the Act, no person shall be recognised by the Company as holding any share

upon any trust and the Company shall not be bound by or be compelled in any way to recognise (even when having notice thereof) any equitable, contingent future or partial interest in any share or any interest in any fractional part of a share or any other rights in respect of any share except an absolute right to the entirely thereof in the registered holder.

10 (1) Every person whose name is entered as a member in the register of members shall be entitled to

receive within two months after allotment (or within such other period as the conditions of issue shall provide) or within one month after the application for the registration of transfer is received by the Company. (a) one certificate for all his shares without payment, or (b) several certificate, each for one or more of his shares, provided that any subdivision,

consolidation or splitting of certificates required in marketable lots shall be done by the Company free of any charges.

11. The Company agrees, that it will not charge any fees exceeding those, which may be agreed upon with the

Stock Exchange. (i) for issue of new certificate in replacement of those that are torn, out defaced lost or destroyed:-

(ii) for sub-division and consolidation of shares and debenture certificates and for subdivision of Letters of Allotment and Split, Consolidation, Renewal and Pucca Transfer Receipts into denominations other than those fixed for the market units of trading".

12. The Company may issue such fractional certificates as the Board may approve in respect of any of the shares

of the Company on such terms as the Board thinks fit as to the period within the fractional certificates are to be converted into share certificates.

13. If any share stands in the names of two or more persons, the person first named in the register of members

shall as regards receipts of dividends, the service of notices and subject to the provisions of these Articles, all or any other matter connected with the Company except the issue of share certificates, voting at meeting and the transfer of the share, be deemed the sole holder thereof.

DEMATERIALISATION OF SECURITIES 14. The provisions of this Article shall apply only in respect of Securities held in Depository mode and the

provisions of the other Articles shall be construed accordingly: 15. for the purpose of this Articles

"Beneficial Owner" : “Beneficial Owner” means the beneficial owner as defined in Clause (a) of Sub-section I of Section 2 of the Depositories Act, 1996.

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“Depository” “Depository” means a Depository as defined under Clause (e) of Sub-section 1 of Section 2 of the Depositories Act, 1996. “Depositories Act, 1996”. “Depositories Act, 1996” shall include any statutory modification(s) or reenactment(s) thereof, for the time being in force. “SEBI” “SEBl” means Securities and Exchange Board of India established under Securities and Exchange Board of India Act, 1992. “Security” “Security” has the meaning assigned to it in Section 2 of the Securities Contracts (Regulation) Act, 1956 or any statuary modification or reenactment thereof for the time being in force. Power to dematerialize: Notwithstanding anything contained in and rematerialize these Articles, the Company shall be entitled to dematerialise its existing shares, debentures and other securities and also rematerialize its shares, debentures and other securities held in Depository Mode and/or offer securities in dematerialised form pursuant to the Depositories Act, 1996 and the rules framed there under: Options for investors Every person subscribing to or holding securities of the Company shall have the option to receive security certificates in accordance with provisions of the other Articles or to hold the same with a Depository. Such a person who is the beneficial owner of the securities may/can at any time opt out of the Depository, if permitted by Law, in respect of any security in the manner provided by the Depositories Act, 1996 and the Company shall in the manner and within the time prescribed therein, issue to the beneficial owner the required certificates of securities. If a person opts to hold his security with a Depository, the Company shall intimate such Depository the details- of allotment of security, and on the receipt of the information, the Depository shall enter in its record the name of the allottee as the beneficial owner of the security.

Securities in Depositories to be in fungible form: a) All the Securities held by a Depository shall be dematerialized and be fungible form.

b) Nothing contained in Sections 153, 153A, 153B, l87B, l87C and 372A of the said Act shall apply to a Depository in respect of the Securities held by it on behalf of the beneficial owners.

Rights of Depositories and Beneficial Owners of Securities:

a) Notwithstanding anything to the contrary contained in the said Act or these Articles, a Depository shall

be deemed to be the registered owner for the purposes of effecting transfer of ownership of securities on behalf of the beneficial owner.

b) Save as otherwise provided in (a) above, the Depository as the registered owner of the securities shall

not have any voting rights or any other rights in respect of the securities held by it.

c) Every person holding securities of the Company and whose name is entered as the beneficial owner in the records of the Depository shall be deemed to be a member of the Company. .

d) The beneficial owner of securities shall be entitled to all the rights and benefits and be subject to all the

liabilities of a member in respect of his securities, which are held by a Depository.

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Furnishing of information by Depository:

a) Notwithstanding anything contained in the said Act or these Articles where securities are held in a depository, the records of the beneficial ownership may be served by such Depository on the Company by means of electronic mode or by delivery of floppies or discs or in such other manner as may be practicable.

Transfer of Securities:

a) Nothing contained in Section 108 of the said Act or these Articles shall apply to a transfer of securities

affected by a transferor and transferee both of who are entered as beneficial owners in the records of a Depository.

b) In the case of transfer or transmission of shares or other marketable securities where the Company has not issued any certificates and where such shares or securities are being held in an electronic and fungible form in a Depository, the provisions of the Depositories Act, 1996 shall apply.

Distinctive numbers of Securities Held in a Depository:

Nothing contained in he said Act or these Articles regarding the necessity of having distinctive numbers for securities issued by the Company shall apply to the Securities held with a Depository. Every fortified or surrendered share held in a material form shall continue to bear the number by which the same was originally distinguished.

Register and index of beneficial owners:

The Register and Index of beneficial owners maintained by a Depository under the Depositories Act, 1996, shall be deemed to be the Register and Index of Members and Security holders as the case may be for the purposes of these Articles.

LIEN

16. (1) The Company shall have a first and paramount lien upon every share (not being fully paid up share) for

all money (whether presently payable or not) called or payable at a fixed time in respect of that share. Unless otherwise agreed the registration of a transfer of a share shall operate as a waiver of the Company's lien if any, on such shares. The Directors may at any time declare any shares be wholly or in part to be exempt from the provisions of this article.

(2) The Company's lien, if any, on a share shall extend to all dividend payable thereon subject to section 205 A of the Act.

17. The company may sell, in such manner as the Board thinks fit, any share on which the Company has a lien

provided that no sale shall be made: (a) unless a sum in respect of which the lien exists is presently payable; or until the expiration of three

days after a notice in writing demanding payment of such part of the amount in respect of which the lien exists as is presently payable, have been given to the registered holder for the time being of the share of the person entitled thereto by reason of his death or insolvency and stating that amount so demanded if not paid within the period specified at the Registered office of the Company the said shares shall be sold.

18. (1) To give effect to any such sale, the Board may authorise some person to transfer the shares sold to the

purchaser thereof. (2) The purchaser shall be registered as the shareholder of the shares comprised in any such transfer.

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(3) The purchaser shall not be bound to see to the application of the purchase money, nor shall his title to the share be affected by any irregularity or invalidity in the proceedings in references to the sale.

19. (1) The proceeds of the sale shall be received by the Company and applied in payment of the whole or a

part of the amount in respect of which the lien exist as is presently payable. (2) The residue, if any, shall, subject to a like lien for sums not presently payable as existed upon the

shares as the date of sale, be paid to the person entitled to the shares at the date of the sale.

CALLS ON SHARES

20. (1) The Board of Directors may, from time to time, make calls upon the members in respect of money unpaid on their shares (whether on account of the nominal value of the shares or by way of premium) and not by the conditions of allotment thereof made payable at fixed times.

(2) Each member shall, subject to receiving at least thirty days notice specifying the time or times and place of payment of the call money pay to the Company at the time or times and place so specified, the amount called on his shares.

(3) A call may be revoked or postponed at the discretion of the Board. 21. A call shall be deemed to have been made at the time when the resolution of the Board authorising the call

was passed. Call money may be required to be paid by instalments. 22. The joint holders of a share shall be jointly and severally liable to pay all call in respect thereof. 23. (1) If a sum called in respect of a share is not paid before or on the day appointed for 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.

(2) The Board shall be at liberty to waive payment of any such interest wholly or in part. 24. (1) Any sum which by the terms of issue of a share become payable on allotment or at any fixed date,

whether on account of the nominal value of the share or by way of premium, shall for purposes of these regulations, be deemed to be a call duly made and payable on the date on which by the terms of issue such sum becomes payable.

(2) In case of non-payment of such sum, relevant provisions of these regulations as to payment of interest and expenses, forfeiture or otherwise shall apply as if such sum had become payable by virtue of a call duly made and notified.

25. Subject to the provisions of Section 92 and 292 of the Act, the Board :-

(a) may, if it thinks fit, receive from any member willing to advance all or any part of the money uncalled and unpaid upon any shares held by him; and

(b) if it thinks fit, may pay interest upon all or any of the moneys advanced on uncalled and unpaid shares (until the same would but for such advance become presently payable) at such rate not exceeding, unless the Company in general meeting shall otherwise direct, 9% (nine percent) per annum as may be agreed upon between the Board and the member paying the sums or advances, Money so paid in advance shall not confer a right to dividend or to participate in profits.

26. On the trial or hearing of any suit or proceedings brought by the Company against any member or his

representative to recover any debt or money claimed to be due to the Company in respect of his share, it shall be sufficient to prove that the name of the defendant is or was, when the claim arose, on the Register of members of the Company as a holder or one of the holders of the number of shares in respect of which such claim is made and that the amount claimed is not entered as paid in the books of the Company and it shall not be necessary to prove the appointment of the Directors who resolved to make any call, nor that a quorum of Directors was present at Board Meeting at which any call was resolved to be made, nor that the meeting at which any call was resolved to be made was duly convened or constituted nor any other matter, but the proof of the matters aforesaid shall be conclusive evidence of the debt.

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27. Neither the receipt by the Company of a 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 a forfeiture of such shares as hereinafter provided.

TRANSFER AND TRANSMISSION OF SHARES

28. The Company shall keep a "Register of Transfer" and therein shall fairly and distinctly enter particulars of

every transfer or transmission of any share. 29. (1) The instrument of transfer of any share in the Company shall be executed by or on behalf of both the

transferor and the transferee. (2) The transferor shall be deemed to remain a holder of the share until the name of the transferee is

entered in the register of members in respect thereof.

30. The instrument of transfer shall be in writing and all the provisions of Section 108 of he Companies Act 1956 and of any modification thereof for the time being shall be complied with in respect of all transfers of shares and registration thereof.

31. Unless the Director decide otherwise, when an instrument of transfer is tendered by the transferee, before

registering any such transfer, the Directors shall give notice by letter sent by registered acknowledgement due post to the registered holder that such transfer has been lodged and that unless objection is taken the transfer will be registered. If such registered holder fails to lodge an objection in writing at the office within ten days from the positing of such notice to him, he shall be deemed to have admitted the validity of the said transfer. Where no notice is received by the registered holder, the Directors shall be deemed to have decided not to give notice and in any event the non-receipt by the registered holder of any notice shall not entitle him to make any claim of any kind against the Company or the Directors in respect of such non-receipt.

TRANSFER OF SHARES

32. The Board of Directors may, subject to the right of appeal conferred by Section 111 of the Companies Act,

1956, decline to register: (a) the transfer of a share not being a fully paid up share, to a person of whom they do not approve; or (b) any transfer of the share on which the Company has a lien, provided that the registration of transfer

shall not be refused on the ground of transferor being either alone or jointly with any person or persons indebted to the Company on any account except a lien.

33. The Board may also decline to recognise any instrument of transfer unless;

(a) the instrument of transfer is accompanied by the certificate of the shares to which it relates, and such other evidence as the Board may reasonably require to show the right of the transferor to make the transfer; and

(b) the instrument is in respect of only one class of shares.

34. All instruments of transfer which shall be registered shall be retained by the Company, but may be destroyed upon the expiration of such period as the Board may from time to time determine. Any instrument of transfer which the Board declines to register shall (except in any case of fraud) be returned to the person depositing the same.

35. (a) the registration of transfers may be suspended at such times and for such period as the Board may,

from time to time, determine: provided that such registration shall not be suspended for more than forty-five days in aggregate in any year or for more than thirty days at any one time.

(b) There shall be no charge for:

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(i) registration of shares or debentures; (ii) sub-division and/or consolidation of shares and debentures certificates and sub-division of Letters

of Allotment and split consolidation, renewal and pucca transfer receipts into denominations corresponding to the market unit of trading;

(c) sub-division of renouncible Letters of Right; (d) issue of new certificates in replacement of those which are decrepit or worn out or where the cages on

the reverse for recording transfers have been fully utilised; (e) registration of any Powers of Attorney, Letter of Administration and similar other documents.

TRANSMISSION OF SHARES

36. (1) On the death of a member, the survivor or survivors where the member was a joint holder and his legal

representative where he was a sole holder shall be the only person recognised by the Company as having any title to his interest in the shares.

(2) Nothing in Clause (1) shall release the estate of a deceased joint holder from any liability in respect of any share which had been jointly held by him with other persons.

37. (1) Any person becoming entitled to a share in consequence of the death or insolvency of a member may,

upon such evidence being produced as may from time to time properly be required by the Board and subject as hereinafter provided elect, either: (a) to be registered himself as holder of the share; or (b) to make such transfer of the shares as the deceased or insolvent member could have made.

(2) The Board shall, in either case, have the same right to decline or suspend registration as it would have had, if the deceased or insolvent member had himself transferred the share before his death or insolvency.

38. (1) If the person so becoming entitled, shall elect to be registered as holder of the share himself, he shall

deliver or send to the Company a notice in writing signed by him stating that he so elects. (2) If the person aforesaid shall elect to transfer the share, he shall testify his election by executing a

transfer of the share. (3) All the limitations, restrictions and provisions of these regulations relating to the right to transfer and

the registration of transfers of shares shall be applicable to any such notice of transfer as aforesaid as if the death or insolvency of the member had not occurred and the notice of transfer were a transfer signed by that member.

39. On the transfer of the share being registered in his name a person becoming entitled to a share by reason of

the death or insolvency of the holder shall be entitled to the same dividends and other advantages to which he would be entitled if he was the registered holder of the share and that he shall not, before being registered as a member in respect of the share be entitled in respect of it to exercise any right conferred by membership in relation to meetings of the Company; Provided that the Board may, at any time, give notice requiring any such person to elect either to be registered himself or to transfer the share and if the notice is not complied with within 90 (ninety) days, the Board may thereafter with hold payment of all dividends, bonus or other moneys payable in respect of the share, until the requirements of the notice been complied with.

40. Where the Company has knowledge through any of its principal officers within the meaning of Section 2 of the Estate Duty Act, 1953 of the death of any member of or debenture holder of the Company, it shall furnish to the Controller within the meaning of such section, the prescribed particulars in accordance with that Act and the rules made thereunder and it shall not be lawful for the Company to register the transfer or any shares or debentures standing in the name of the deceased, unless the transferor has acquired such shares for valuable consideration or a certificate from the Controller is produced before the Company to the effect that the Estate Duty in respect of such shares and debentures has been paid or will be paid or that none is due, as the case may be.

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41. The Company shall incur liability whatever in consequence of its registering or giving effect, to any transfer of share made or purporting to be made by any apparent legal owner thereof (as shown or appearing in the register of members) to the prejudice of persons having or claiming any equitable right, title of interest to or in the said shares, notwithstanding that the Company may have had notice of such equitable rights, 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 rights, title or interest or be under any liability for refusing or neglecting so to do, though it may have been entered or referred to in some book of the Company but the Company though not bound so to do, shall be at liberty to regard and attend to any such notice and give effect thereto if the Board shall so think fit.

FORFEITURE OF SHARES

42. If a member fails to pay any call or installment of a call, on the day appointed for payment thereof, the

Board may, at any time thereafter during such time as any part of the call or installment remains unpaid, serve a notice on him requiring payment of so much of the call or installment as is unpaid together with any interest which may have accrued and all expenses that may have been incurred by the Company by reason of such non-payment.

43. The notice aforesaid shall:

(a) name of further day (not earlier than the expiry of 30 (thirty) days from the date of service of notice) on or before which the payment required by the notice is to be made; and

(b) state that, in the event of non-payment on or before the day so named, the shares in respect of which the call was made, will be liable to be forfeited.

44. If the requirements of any such notice as aforesaid are not complied with, any share in respect of which the

notice has been given may, at any time, thereafter, before the payment required by the notice has been made, be forfeited by a resolution of the Board to that effect. Such forfeiture shall include all dividends declared in respect of the forfeited shares and not actually paid before the date of forfeiture, which shall be the date on which the resolution of the Board is passed forfeiting the shares.

45 (1) A forfeited share may be sold or otherwise disposed of on such terms and in such a manner as the

Board thinks fit. (2) At any time before a sale or disposal, as aforesaid, the Board may annul the forfeiture on such terms as

it may thinks fit.

46. (1) A person whose shares have been forfeited shall cease to be a member in respect of the forfeited shares, but shall, notwithstanding the forfeiture, remain liable to pay to the Company all moneys which, at date of forfeiture, were presently payable by him to the Company in respect of the shares together with interest thereon from the time of forfeiture until payment at the rate of 9% (nine percent) per annum.

(2) The Liability of such person shall cease if and when the Company shall have received payments in full of all such money in respect of the shares.

47. (1) A duly verified declaration in writing that the declarant is a director or the secretary of the Company

and that a share in the company has been duly forfeited on a date stated in the declaration, shall be conclusive evidence of the facts therein stated as against all persons claiming to be entitled to the share.

(2) The Company may receive the consideration, if any, given for the share on any sale or disposal thereof and may execute a transfer of the share in favour of the person to whom the share is sold or disposed off.

(3) The transferee shall thereupon be registered as the holder of the share.

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(4) The transferee shall not be bound to see to the application of the purchase money, if any, nor shall his title to the share be affected by any irregularity or invalidity in the proceedings in reference to the forfeiture, sale of disposal of the share.

48. The provisions of these regulations as to forfeiture shall apply, in the case of non-payment of any sum

which, by the terms of issue of a share, becomes payable at a fixed time, whether on account of the nominal value of the share or by way of premium, as if the same had been payable by virtue of a call duly made and notified.

49. The forfeiture of a share shall involve the extinction of all interest in and also of all claims and demands

against the Company in respect of the share, and all other rights incidental thereto except only such of those rights as by these Articles are expressly saved.

50. Upon any sale, after forfeiture or for enforcing a lien in purported exercise of powers hereinbefore given, the

Board may appoint some person to execute an instrument of transfer of the shares sold and cause the purchaser's name to be entered in the Register in respect of the shares sold and the purchaser shall not be bound to see to the regularity of the proceedings or to the application of the purchase money and after his name has been entered in the Register in respect of such shares, the validity, of the sale shall not be impeached by any person and the remedy of any person aggrieved by the sale shall be in damages only and against the Company exclusively.

51. Upon any sale, re-allotment or other disposal under the provisions of these Articles relating to lien or to

forfeiture, the certificate or certificates originally issued in respect of the relative shares shall (unless the same shall on demand by the Company have been previously surrendered to it by the defaulting member) stand cancelled and become null and void and of no effect. When any shares, under the powers in that behalf herein contained are sold by the Board and the certificate in respect thereof has not been delivered up to the Company by the former holder of such shares, the Board may issue a new certificate for such shares distinguishing it in such manner as it may think fit, from the certificate not so delivered.

52. The Directors may subject to the provisions of the Act, accept from any member on such terms and

conditions as shall be agreed, a surrender of his shares or stock or any part thereof.

CONVERSION OF SHARES INTO STOCK

53. The Company may, by an ordinary resolution: (a) convert any paid-up shares into stock; and (b) reconvert any stock into paid-up shares of any denomination authorised by these regulations.

54. The holders of stock may transfer the same or any part thereof in the same manner as, and subject to the

same regulations under which, the shares from which the stock arose might before the conversion have been transferred or as near thereto as circumstances admit: provided the Board may, from time to time, fix the minimum amount of Stock transferable, so however, that such minimum shall not exceed the nominal amount of the shares from which the stock arose.

55. The holders of stock shall, according to the amount of stock held by them, have the same rights, privileges

and advantages as regard dividends voting and meeting of the Company, and other matters, as if they held the shares from which the stock arose; but no such privilege or advantage (except participation in the dividends and profits of the Company and in the assets on winding up) (shall be conferred by an amount of stock which would not, if existing in shares, have conferred that privilege or advantage.

56. Such of the regulations of the Company (other than those relating to share warrants), as are applicable to

paid-up shares shall apply to stock and the words "share" and "shareholders" in those regulations shall include "stock" and "stockholder" respectively.

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SHARE WARRANTS

57. The Company may issue share warrant, subject to and in accordance with, the provisions of Sections 114

and 115 of the Act and accordingly the Board may in its discretion with respect of any share which is fully paid up, on application in writing signed by the person registered as holder of the share and authenticated by such evidence (if any) as the Board may, from time to time, require as to the identity of the person signing the application and on receiving the certificate (if any) of the share; and the amount of the stamp duty on the warrant and such fee as the Board may, from time to time, require, issue a share warrant.

58. (1) The bearer of a share warrant may at any time deposit the warrant at the office of the Company and so

long as the warrant remains so deposited, the depositor shall have the same right of signing a requisition for calling a meeting of the Company and of attending and voting and exercising, the ether privileges of a member at any meeting held after the expiry of two clear days from the time of deposit, as if his name were inserted in the register of members as the holder of the shares included in the deposited warrant

(2) Not more than one person shall be recognised as depositor of the share warrant. (3) The company shall, on two days written notice, return the deposited share warrant to the depositor.

59. (1) Subject as herein otherwise expressly provided, no person shall, as bearer of a share warrant, sign a

requisition for calling meeting of the Company or attend or vote or exercise any other privilege of a member at a meeting of the Company or be entitled to receive any notice from the Company.

(2) The bearer of a share warrant shall be entitled in all other respect to the same privileges and advantages as if he was named in the register of member as the holder of the shares included in the warrant and he shall be deemed to be a member of the Company in respect thereof.

60. The Board may, from time to time, make rules as to the terms on which (if it shall think fit) a new share

warrant or coupon may be issued by way of renewal in case of defacement, loss or destruction of the original.

ALTERATION OF CAPITAL

61. The Company may, from time to time, by ordinary resolution increase its share capital by such sum, to be

divided into shares of such amount, as the resolution shall specify. 62. The Company may, by ordinary resolution in general meeting:

(a) consolidate and divide all or any of its capital into shares of larger amounts than its existing shares; (b) sub-divide its shares or any of them, into shares of similar amounts than is fixed by the Memorandum

of Association, so however, than in the sub-division the proportion between the amount paid and the amount, if any, unpaid on each reduced share shall be the same as it was in the case of the share from which the reduced shares in derived;

(c) cancel any share which, at the date of the passing of the resolution in that behalf, have not been taken or agreed to be taken by any person and diminish the amount of its share capital by the amount of the shares so cancelled.

63. The Company may, from time to time, by special resolution and on compliance with the provisions of

Section 100 to 105 of the Act/reduce its share capital and any capital reserve fund or share premium account. 64. The Company shall have power to establish Branch Offices, subject to the provisions of Section 8 of the Act

or any statutory modifications thereof. 65. The Company shall have power to pay interest out of its capital on so much of shares which were issued for

the purpose of raising money to defray the expenses of the construction, of any work or building or the provisions of any plant for the Company in accordance with the provisions of Sections 208 of the Act.

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66. The Company, if authorised by a special resolution passed at General Meeting may amalgamate or cause

itself to be amalgamated with any other person, firm or body corporate, subject however to the provisions of Section 391 to 394 of the Act.

GENERAL MEETING

67. All General Meetings other than the Annual General Meetings of the Company shall be called Extra-

ordinary General Meetings. 68. (1) The Board, may, whenever it thinks fit may call in Extraordinary General Meeting.

(2) If at any time there are not within India Directors capable of acting who are sufficient in number to form a quorum, any Director or any two members of the Company may call an extraordinary general meeting in the same manners, as nearly as possible, to that in which such a meeting may be called by the Board.

CONDUCT OF GENERAL MEETINGS

69. No general meeting, annual or extraordinary, shall be competent to enter upon, discusser transact any

business, which has not been stated in the notice by which it was convened or called. 70. (1) No business shall be transacted at any general meeting, unless quorum or members is present at the

time when the meeting proceeds to business. (2) Save as otherwise provided in Section 174 of the Act, a minimum of five members present in person

shall be the quorum. A body corporate, being a member, shall be deemed to be personally present if it is represented in accordance with Section 187 of the Act.

CONDUCT OF MEETINGS

71. The Chairman, if any, of the Board shall preside as Chairman at every general meeting of the Company. 72. If there is no such Chairman or if he is not present within fifteen minutes of the time appointed for holding

the meeting or is unwilling to act as Chairman of the meeting, the Directors present shall elect one of their members to be the Chairman of the meeting.

73. If at any meeting no Director is willing to act as Chairman or if no Director is present within 15 (fifteen)

minutes of the appointed for holding meeting, the members present shall choose one of their members to be the Chairman of the meeting.

74. No business shall be discussed at any general meeting except the election of a chairman, whilst the chair is

vacant. 75. (1) The chairman may with the consent of any meeting at which a quorum is present and shall, if so

directed by the meeting, adjourn the meeting, from time to time and place to place. (2) No business shall be transacted at any adjourned meeting, other than the business left unfinished at the

meeting from which the adjournment took place. (3) When a meeting is adjourned for thirty days or more, fresh notice of the adjourned meeting shall be

given as in the case of an original meeting. (4) Save as aforesaid, it shall not be necessary to give any notice of any adjournment or of the business to

be transacted at an adjourned meeting.

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76. In the case of an equality of votes, whether on a show of hands or on a poll, the chairman of the meeting at which the show of hands takes places or at which the poll is demanded, shall be entitled to a second or casting vote.

77. Any business other than that upon which a poll has been demanded, may be proceeded, with, pending the

taking of the poll.

VOTES OF MEMBERS

78. Subject to any rights or restrictions for the time being attached to any class or classes of shares. (i) on a show of hands, every member present in person shall have one vote and (ii) on a poll, the voting rights of members shall be as laid down in Section 87 of the Act.

79. In the case of joint holders, the vote of the senior who tenders a vote whether in person or by proxy, shall be

accepted to the exclusion of the votes of the other joint holders. For this purpose, seniority shall be determined by the order in which the names of joint holders stand in the Register of members.

80. A member of unsound mind or in respect of whom an order has been made by any Court having jurisdiction

in lunacy, may vote, whether on a show of hands or on a poll by his committee or other legal guardian, and any such committee or guardian may on a poll, vote by proxy, provided that such evidence as the Board may require of the authority of the person claiming to vote shall have been deposited at the office not less than 24 hours before the time of holding the meeting or adjourned meeting at which such person claims to vote on poll.

81. No member shall be entitled to vote at any general meeting unless all calls, and other sums presently payable

by him in respect of shares in the Company or in respect of shares on which the Company has exercised any right of lien, have been paid.

82. (1) No objection shall be raised to the qualification of any voter, except at the meeting or adjourned

meeting at which the vote objected to is given or tendered and every vote not disallowed at such meeting shall be valid for all purposes.

(2) Any such objection made in due time shall be referred to the Chairman of the meeting, whose decision thereon shall be final and conclusive.

83. The instrument appointing a proxy and the power of attorney or other authority, if any under which it is

signed or a notarially certified copy of that power or authority shall be deposited at the registered office of the Company, not less than 48 hours before the time for holding the meeting of adjourned meeting at which the person named in the instrument proposes to vote, or in the case of a poll, not less than 24 hours before the time appointed for the taking of the poll; and in default the instrument of proxy shall not be treated valid.

84. An instrument appointing a proxy shall be in either of the forms in Schedule IX to the Act or in a form as

near thereto as circumstances admit. 85. A vote given in accordance with the terms of an instrument of proxy shall be valid notwithstanding the

previous death or insanity of the principal or the revocation of the proxy of the authority under which the proxy are executed or the promoter of the shares in respect of which the proxy is given, if no intimation in writing of such death insanity, revocation or transfer shall have been received by the Company at its office before commencement of the meeting or adjourned meeting at which the proxy is used.

BOARD OF DIRECTORS

86. The number of Directors of the Company shall not be less than three and not more than twelve.

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87. The following shall be the Directors of the Company: as on the date of Conversion of Company from private to public Limited 1. Sudesh Behal 2. Sunirmol Ghosh 3. Gajendra Singh Panwar

88. At every Annual General Meeting of the Company one-third of such of the Directors for the time being as

are liable to retire by rotation in accordance with the provisions of Section 255 of the Act or if their number is not three or multiple of three, then the number nearest to one third shall retire from office in accordance with the provisions of Section 256 of the Act.

89. (i) Subject to the provisions of Section 309, 310 and 314 of the Act, the Directors shall be paid such

further remuneration, whether in the form of monthly payment or by a percentage of profit or otherwise, as the Company in General meeting may, from time to time, determine and such further remuneration shall be divided among the Directors in such proportion and in such manner as the Board may, from time to time, determine and in default of such determination shall be divided among the Directors equally as is so determined paid on a monthly basis.

(ii) The remuneration of the Directors shall, in so far as it consist of a monthly payment, be deemed to accrue from day to day.

(iii) Subject to the provisions of Sections 198,269 read with schedule XIII, 309, 310 and 314 of the Act, if any Director be called upon to perform any extra services or make special exertions or efforts (which expression shall include work done by a Director as a member of any committee formed by the Directors) the Board may pay such Director special remuneration for such extra services or special exertions or efforts either by way of a fixed sum or by percentage of profit otherwise and may allow such Directors at the cost and expense of the Company such facilities or amenities (such as rent free house, free medical aid and free conveyance) as the Board may determine from time to time.

(iv) In addition to the remuneration payable to them in pursuance of the Act, the Directors may be paid in

accordance with Company's rules to be made by the Board all travelling, hotel and other expenses properly incurred by them: (a) in attending and returning from meetings or adjourned meeting of the Board of Directors or any

committee thereof; or (b) in connection with the business of the Company.

90. The Directors shall not be required to hold any qualification shares in the Company. 91. The Board of Directors shall have power to appoint additional Directors in accordance with the provisions of

Sections 260 of Act. 92. If it is provided by any trust deed securing or otherwise in connection with any issue of debentures of the

Company that any person or persons shall have power to nominate, a Director of the company then in the case of any and every such issue of debentures, the persons having such power may exercise such power, from time to time and appoint a Director accordingly. Any Director so appointed is herein referred to as a debenture Director. A Debenture Director may be removed from office at any time by the person or persons in whom for the time being is vested the power under which he was appointed and another Director may be appointed in his place. A Debenture Director shall not be liable to retire by rotation, but he, shall be counted in determining the number of retiring Directors.

93. In the course of Its business and for its benefit the Company shall, subject to the provisions of the Act be

entitled to agree with any person, firm, corporation, government, financing institution or other authority that he or it shall have the right to appoint his or its nominee on the Board of Directors of the Company upon such terms and conditions as the Directors may deem fit. Such nominees and their successors in office appointed under this Article shall be called Special Directors. Special Directors shall be entitled to hold office until requested to retire by the government, authority, person, firm, institution or corporation who may

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have appointed them and will not be bound to retire by rotation. As and whenever a Special Director vacates office whether upon request as aforesaid or by death, resignation or otherwise the government, authority, person, firm, institution or corporation how appointed such Special Director may if the agreement so provide, appoint another Director in his place. But he shall be counted in determining the number of retiring Directors.

94. Subject to the provisions of Section 313 of the Act, the Board of Directors shall have power to appoint an

alternate Director to act for a Director during his absence for a period of not less than three months from the State in which meetings of the Board are ordinarily held.

95. A Director may be or become a director of any company promoted by the company or in which it may be

interested as a vendor, shareholder or otherwise and no such Director shall be accountable for any benefits received as director or shareholder of such company. Such Director, before receiving or enjoying such benefits in cases in which the provisions of Section 314 of the Act are attracted will ensure that the same have been complied with.

96. Every nomination, appointment or removal of a Special Director shall be in writing and accordance with the

rules and regulations of the government, corporation or any other institution. A Special Director shall be entitled to the same rights and privileges and be subject to same obligations as any other Director of the Company.

97. The office of a Director shall become vacant:

(i) on the happening of any of the events provided for in Section 283 of the Act: (ii) on contravention of the provisions of Section 314 of the Act, or any statutory modifications thereof; (iii) if a person is a Director of more than twenty Companies at a time; (iv) in the case of alternate Director on return of the original Director of the State, in terms of Section 313

of the Act; or (v) on resignation of his office by notice in writing and is accepted by the Board.

98. Every Director present at any meeting of the Board or a committee thereof shall sign his name in a book to

be kept for that purpose, to show his attendance thereat.

POWERS OF BOARD OF DIRECTORS

99. The Board of directors may pay all expenses incurred in the formation, promotion and registration of the Company,

100. The Company may exercise the powers conferred by Section 50 of the Act, with regard to having an official

seal for used abroad and such powers shall be vested in the Board. 101. The Company may exercise the powers conferred on it by Section 157 and 158 of the Act with regard to the

keeping of a foreign register; and the Board may (subject the provisions of those Section) make and vary such regulations as it may think fit with respect to the Keeping of any such register.

102. The Directors may enter into contracts or arrangements on behalf of the Company subject to the necessary

disclosures required by the Act being made wherever any Director is in any way, whether directly or indirectly concerned or interested in the contract or arrangement.

BORROWING POWER

103. Subject to the provisions of Sections 58A, 292 and 293 of the Act, and the Regulations thereunder and

Direction issued by the RBI the Directors may exercise all the powers of the Company to borrow money and to mortgage or charge its undertaking, property (both present and future) and uncalled capital, or any part

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thereof and to issue debentures, debenture stock and other securities whether outright or as security for any debt, liability or obligation of the Company or of any third party.

104. The payment or repayment of moneys borrowed as aforesaid may be secured in such manner and upon such

terms and conditions in all respects as the Board may think fit and in particular by a resolution passed at a meeting of the Board (and not by circulation) by the issue of debenture or debenture stock of the Company, charged upon all or any of the property of the Company (both present and future), including its uncalled capital for the time being.

105. Any debentures, debenture stock or other securities maybe issued at a discount, premium or otherwise, may

be made assignable free from any equities between the Company and person to whom the same may be issued and may be issued on the condition that they shall be convertible into shares of any authorised denomination, and with privileges and conditions as to redemption, surrender, drawings, allotment of shares, attending (but not voting) at general meetings, appointment of Directors and otherwise, provided that debentures with the right to allotment of or conversion into shares shall not be issued except with the sanction of the Company in General meeting.

106. All cheques, promissory notes, drafts, hundies, bills of exchange and other negotiable instruments and all receipts for moneys paid to the Company, shall be signed, drawn, accepted, endorsed or otherwise executed, as the case may be, by such person and in such manner as the Board may, from time to time, by resolution determine.

PROCEEDINGS OF THE BOARD

107. Subject to Section 287 of the Act, the quorum for a meeting of the Board of Directors shall be one third of

its total strength (any fraction contained in that one third being rounded off as one) or two Directors, whichever is higher; provided that where at any time the number of interested Directors exceeds or is equal to two thirds of the total strength, the number of the remaining Directors, that to say, the number of Directors, who are not interested, present at the meeting, being not less than two, shall be the quorum during such time.

108. If a meeting of the Board could not be held for want of quorum, whatever number of Directors not being less

than two, shall be present at the adjourned meeting, notice where of shall be given to all the Directors, shall form a quorum.

109. (1) Save as otherwise expressly provided in the Act, questions arising at any meeting of the Board shall be

decided by a majority of vote. (2) In case of an equality of votes, the Chairman of the meeting shall have a second or casting vote.

110. The continuing Directors may act notwithstanding any vacancy in the Board, but if and 111. So long as their number is reduced below the quorum fixed by the Act for a meeting of the Board, the

continuing Directors or Director may act for the purpose of increasing the number of Directors to that fixed for the quorum or for summoning a General meeting of the Company, but for no other purpose.

112. (1) Save as provided in Article 93, the Board may elect one of its members as Chairman of its meetings

and determine the period for which he is to hold office as such. (2) If no such Chairman is elected or if at any meeting the Chairman is not present within fifteen minutes

after the time appointed for holding the meeting, the Directors present may choose one of their members to be Chairman of the meeting.

113. Subject to the restrictions contained in Section 292 and 293 of the Act, the Board may delegate any of its

powers to committees of the Board consisting of such member or members of its body as it thinks fit and it may, from time to time, revoke such delegation and discharge any such committee of the Board either wholly or in part, and either as to persons or purposes, but every committee of the Board so formed shall in

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the exercise of the powers so delegated conform to any regulations that may from time to time be imposed on it by the Board. All acts done by any such committee of the Board in conformity with such regulations and in fulfillment of the purposes of their appointment but not otherwise, shall have the like force and effect as if done by the Board.

114. The meetings and proceedings of any such committee of the Board consisting of two or more members shall

be governed by the provisions herein contained for regulating the meetings and proceedings of the Directors so far as the same are applicable thereto and are not superseded by any regulations made by the Directors under the last proceeding Articles.

115. (1) A committee may elect a chairman of its meetings. (2) If no such chairman is elected or if at any meeting the chairman is not present within five minutes of

the time appointed for holding the meeting, the members present may choose one of their members to be chairman of the meeting.

116. (1) A committee may meet and adjourn as it thinks proper. (2) Questions arising at any meeting of a committee shall be determined by a majority of votes of the

members present and in case of an equality of votes, the chairman shall have a second or casting vote. 117. All acts done by any meeting of the Board or by a committee there of by any person acting as a Director

shall, not with standing that it shall afterwards be discovered that there was some defect in the appointment or continuance in office of any such Directors or persons acting as aforesaid: or that they or any of them were disqualified or had vacated office or were not entitled to act as such or that the appointment of any of them had been terminated by virtue of any provisions contained in the Act or in these Articles, be as valid as if every such person had been duly appointed, had duly continued in office was qualified, had continued to be a Director his appointment had not been terminated and he had been entitled to be a Director provided that nothing in this Article shall be deemed to give validity to any act done by a Director after his

118. Appointment has been shown to the Company to be invalid or to have terminated. 119. Subject to Section 289 of the Act and except a resolution which the Act requires specifically to the passed in

any board meeting, a resolution in writing, signed by the majority members of the Board or of a committee thereof; for the time being entitled to receive notice of a meeting of the Board or committee, shall be as valid and effectual as if it had been passed at a meeting of the Board or committee, duly convened and held.

MANAGING DIRECTOR (S) AND WHOLE TIME DIRECTOR (S)

120. Subject to provisions of Section 197A, 269, 198 and 309 of the Act, Board of Directors may, from time to

time, appoint one or more of their body to the office of Managing Directors or whole time Directors for a period not exceeding 5 (five) years at a time and on such terms and conditions as the Board may think fit and subject to the terms of any agreement entered into with him, may revoke such appointment, and in making such appointments the Board shall ensure compliance with the requirements of the Companies Act, 1956 and shall seek and obtain such approvals as are prescribed by the Act, provided that a Director so appointed, shall not be whilst holding such office, be subject to retirement by rotation but his appointment shall be automatically determine if the ceases to be a Director. However he shall be counted in determining the number of retiring Directors.

121. The Board may entrust and confer upon Managing Director/s or whole time Director/s any of the powers of

management which would not otherwise be exercisable by him upon such terms and conditions and with such restrictions as the Board may think fit, subject always to the superintendence, control and direction of the Board and the Board may, from time to time revoke, withdraw, alter or vary all or any of such powers.

SECRETARY

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122. (1) Subject to section 383A of the Act, a Secretary of the Company may be appointed by the Board on such terms, at such remuneration and upon such conditions as it may think fit, and any Secretary so appointed may be removed by the Board.

(2) A Director may be appointed as a Secretary. 123. Any provision in the Act or these regulations requiring or authorising a thing to be done by or to a Director

and the Secretary shall not be satisfied by its being done by or to the same person acting both as Director and as, or in place of the Secretary.

THE SEAL

124. (1) The Board shall provide a common seal for the purposes of the Company and shall have power, from

time to time, to vary or cancel the same and substitute a new seal in lieu thereof. The Board shall provide for the safe custody of the seal for the time being.

(2) Subject to any statutory requirements as to Share Certificates or otherwise, the seal of the Company shall not be affixed to any Instrument except by authority of a resolution of the Board or of a committee of the Board authorised by it in that behalf, and except in the presence of atleast one Director and of the Secretary or of two Directors who shall sign every instrument to which the seal of the Company is so affixed in their presence. This is, however, subject to Rule 6 of the Companies (Issue of Share Certificates) Rules, 1960.

(3) The Board shall also be at liberty to have an official seal in accordance with Section 50 of the Act, for use in any territory, district or place outside India. The Company shall, however, comply with Rule 6 of the Companies (Issue of Share Certificates) Rules, 1960.

DIVIDENDS AND RESERVES

125. The Company in General meeting may declare dividends but no dividend shall exceed the amount recommended by the Board.

126. The Board may, from time to time, pay to the members such interim dividends as appear it to be justified by

the profits by the Company. 127. (1) The Board may, before recommending any dividend, set aside out of the profits of the Company, such

sums, as it may think proper, as reserve or reserves which shall at the discretion of the Board, be applicable for any of the purposes to which the profits of the Company may be properly applied, including provision for meeting contingencies or for equalising dividends and pending such applications may at the like discretion either be employed in the business of the Company or be invested in such investments (other than shares of the Company) as the Board may, from time to time, think fit.

(2) The Board may also carry forward any profits which it may think prudent not to divide without setting them aside as a reserve.

128. (1) Subject to the rights of the persons, if any, holding shares with special rights as to dividends, all

dividends shall be declared and paid according to the amounts paid or credited as paid on the shares in respect whereof the dividend is paid.

(2) No amount paid or credited as paid on a share in advance of calls shall be treated for the purposes of this regulation as having been paid on the share.

(3) All dividends shall be apportioned and paid proportionately to the amounts paid or credited as paid on the shares during any portion or portions of the period in respect of which the dividend is paid but if any share is issued on terms providing that it shall rank for dividend as from a particular date such share shall rank for dividend accordingly.

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129. The Board may deduct from any dividend payable to any member all sums of money, if any, presently payable by him to the Company on account of calls or otherwise in relation to the shares of the Company subject to section 205A of the Act.

130. (1) Any dividend, interest or other moneys payable in cash in respect of shares may be paid by cheque or

warrant sent through the post direct to the registered address of the holder or in case of joint holders, to the registered address of that one of the joint holders who is first named on the register of members, or to such person and to such address as the first named holder or joint holders may in writing direct such address as the first named holder or joint holders may in writing direct.

(2) Every such cheque or warrant shall be made payable to the order of the person to whom it is sent. 131. Anyone of two or more joint holders of a share may give effectual receipts for any dividends, bonus or other

moneys payable in respect of such share. 132. Notice of any dividend that may have been declared shall be given to the persons entitled to share therein in

the manner mentioned in the Act. 133. No dividend shall bear interest against the Company, irrespective of the reason for which it has remained

unpaid.

ACCOUNTS

134. (1) The Board shall cause proper books of accounts to be maintained under section 209 of the Act. (2) The Board shall, from time to time, determine whether and to what extent and at what times and places

and under what conditions or regulations, the accounts and books of the Company or any or them, shall be open to the inspection of members not being Directors.

(3) Subject to provisions of section 209 A of the Act, no member (not being a Director) shall have any right of inspecting any account or book or document of the Company, except as conferred by law or authorised by the Board or by the Company in General Meeting.

BALANCE SHEET AND PROFIT AND LOSS ACCOUNT

135. Balance sheet and Profit and Loss Account of the Company will be audited once in a year by a qualified auditor for Correctness as per provision of the Act.

136. (1) The first auditor of the Company shall be appointed by the Board of Directors within one month after

its incorporation who shall hold office till the, conclusion of first Annual General Meeting. (2) The Board of Directors may fill up any Casual Vacancy in the office of the Auditors. (3) The remuneration of the Auditors shall be fixed by the Company in the annual general meeting except

that remuneration of the first or any auditors appointed by the directors may be fixed by the directors.

CAPITALISATION OF PROFITS

137. (1) The Company in General Meeting may, upon the recommendation of the Board resolve: (a) that it is desirable to capitalise any part of the amount for the time being standing to the credit of

any of the Company's reserve accounts or to the credit of the Profit and Loss Account, or otherwise available for distribution; and

(b) that such sum be accordingly set free for distribution in the manner specified in clause (2) among the members who would have been entitled thereto, if distributed by way of dividend and in the same proportions.

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(2) The sum aforesaid shall not be paid in cash, but shall be applied, subject to the provisions contained in clause (3) either in or towards: (i) paying up any amounts for the time being unpaid on any shares held by such members

respectively; (ii) paying up in full, unissued shares of the Company to be allotted and distributed, credited as

fully paid up, to and amongst such members in the proportions aforesaid; or (iii) partly in the way specified in sub-clause (i) and partly in that is specified in sub-clause (ii).

(3) Any share premium account and any capital redemption reserve fund may, for the purpose of this regulation, only be applied in the paying up of unissued share to be issued to members of the Company as fully paid bonus shares.

(4) The Board shall give effect to the resolution passed by the Company in pursuance of this regulation. 138. (1) Whenever such a resolution as aforesaid shall have been passed, the Board shall:

(a) make all appropriations and applications of the undivided profits resolved to be capitalised thereby and allotment and issue of fully paid shares, if any; and

(b) do all acts and things required to give effect thereto. (2) The Board shall have full power:

(a) to make such provisions, by the issue of fractional certificates or by payment in cash or otherwise it thinks fit in the case of shares becoming distributable in fractions; and also

(b) to authorise any person to enter, on behalf of all the members entitled thereto, into an agreement with the Company providing for the allotment to them respectively, credited as fully paid up, of any further shares of which that may be entitled upon such capitalisation or (as the case may require) for the payment by the company on their behalf by the application thereto of their respective proportions of the profit, resolved to be capitalised, of the amounts or any part of the amounts remaining unpaid on their existing shares.

(3) Any agreement made under such authority shall be effective and binding on all such members.

SECRECY

139. Subject to the provisions of law of land and the Act, no member or other person (not being a Director) shall be entitled to visit or inspect the Company's works without the permission of the Board of Directors or the managing Director to require discovery of any information respecting any details of the Company's business, trading or customers of any matter which is or may be in the nature of a trade secret, mystery of trade or secret process or any other matter which may be related to the conduct of the business of the Company or which in the opinion of the Directors, it will be inexpedient in the interest of the Company to disclose.

WINDING UP

140. (1) If the company shall be wound up the liquidator may, with the sanction of a special resolution of the

company, and any other sanction required by the Act, divide amongst the members in specie or kind or otherwise, the whole or any part of the assets of the Company whether they shall consist of property of the same kind or not.

(2) For the purpose aforesaid, the liquidator may set such values as he deems fair upon any property to be divided as aforesaid and may determine how such division shall be carried out as between the members or different classes of members.

(3) The liquidator may, with the like sanction, vest the whole or any part of such assets trustees upon such trusts for the benefit of the contributories as the liquidator, with the like sanction, shall think fit but so that no member shall be compelled to accept any shares or other securities whereon there is any liability.

INDEMNITY

141. Subject to the provision of section 201 of Act every Director, auditor, secretary; and other officer or servant

of the Company (all of whom are hereinafter referred to as officer or servant) shall be indemnified by the

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Company and it shall be the duty of the Director out of the funds of the company to pay, all bonafide costs, losses and expenses which any such officer or servant may incur or become liable to by reason of any contract entered into or act or thing done or omitted by him as such officer or servant or in any way in the discharge of the duties; and in particular and so as not to limit the generality of the foregoing provisions against any liability incurred by such officer or servant in defending any bonafide proceedings whether civil or criminal in which a judgment is given in his favour or in which he is acquitted or is discharged or in connection with any application under Section 633 of the Act in which relief is granted to him by the Court. The amount for which such indemnity is provided shall immediately attach as a charge on the property of the company.

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SECTION IX – OTHER INFORMATION MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION The following Contracts (not being contracts entered into in the ordinary course of business carried on by our Company or entered into more than two years before the date of this Draft Red Herring Prospectus) which are or may be deemed material have been entered or to be entered into by our Company. These Contracts, copies of which have been attached to the copy of this Draft Red Herring Prospectus, delivered to the RoC for registration and also the documents for inspection referred to hereunder, may be inspected at the Registered Office of our Company situated at C-28, South Extension Part -I, New Delhi– 110049 from [10.00] am to [4.00] pm on working days from the date of this Draft Red Herring Prospectus until the Bid/Issue Closing Date. MATERIAL CONTRACTS

1. Memorandum of Understanding dated May 9, 2006 amongst our Company, and the BRLMs.

2. Agreement dated April 26, 2006 executed by our Company with the Registrar to the Issue.

3. Escrow Agreement dated [•] between us, the BRLMs, Escrow Collection Banks and Registrar to the Issue.

4. Underwriting Agreement dated [•] between us and the BRLMs.

MATERIAL DOCUMENTS 1. Our Memorandum and Articles of Association as amended from time to time. 2. Our certificate of incorporation dated May 2, 1988. 3. Our certificates in relation to change of name. 4. Resolutions passed by Shareholders/ Board of Directors in relation to this Issue and other related matters such

as appointment of auditors, formation and revision of Audit, Remuneration and other committees 5. Resolutions approving the present terms of employment between our Company and our Directors as approved

by our Board and our Shareholders. 6. Report of the auditors, M/s SNR & Co., Chartered Accounts, dated May 3, 2006 prepared as per Indian GAAP

and mentioned in this Draft Red Herring Prospectus. 7. 'Statement of Tax Benefits' dated May 3, 2006 prepared by our auditors, M/s SNR & Co. 8. Copies of annual reports of our Company for the years ended March 31, 2001, 2002, 2003, 2004 and 2005 and

for the 11 month period ended February 28, 2006. 9. Consent of our auditors, M/s SNR & Co., Chartered Accountants, for inclusion of their report on accounts in the

form and context in which they appear in this Draft Red Herring Prospectus 10. Copy of In principle Sanction letter from Bank of India for a Rupee Term Loan of Rs.515 Lacs. 11. Copy of In principle sanction letter from Kotak Mahindra Primus Ltd. for a Rupee Term Loan of Rs.331 Lacs. 12. Consents of Bankers to the Company, Registrar to the Issue, Legal counsel to the Issue, Directors of the

Company, Company Secretary and Compliance Officer, as referred to, in their respective capacities.

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14. In-principle approval from BSE dated [●]

13. In-principle approval from NSE dated [●]

15. Tripartite Agreement between NSDL, our Company and the Registrar to the Issue dated [●] 16. Tripartite Agreement between CDSL, our Company and the Registrar to the Issue dated [●] 17. Due diligence certificate dated May 15, 2006 submitted by the BRLM, IDBI Capital Market Services Limited to

SEBI.. Any of the contracts or documents mentioned in this Prospectus may be amended or modified at any time if so required in the interest of the 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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