DISCLAIMER

THE PROSPECTUS IS BEING FURNISHED SOLELY IN CONNECTION WITH THE PROPOSED PUBLIC ISSUE
OF SECURED AND UNSECURED NON CONVERTIBLE DEBENTURES, (COLLECTIVELY “NCDs”) OF
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED AGGREGATING UPTO RS. 25,000 LAKHS WITH AN
OPTION TO RETAIN OVERSUBCRIPTION UPTO RS. 25,000 LAKHS FOR ALLOTMENT OF ADDITIONAL NCDs,
WITH A RESERVATION OF UNSECURED NCDs AGGREGATING UPTO RS. 20,000 LAKHS PURSUANT TO THE
PROVISIONS OF THE SECURITIES EXCHANGE BOARD OF INDIA (ISSUE AND LISTING OF DEBT
SECURITIES) REGULATIONS, 2008 AND OTHER APPLICABLE STATUTORY AND REGULATORY
REQUIREMENTS.

ELECTRONIC VERSIONS OF THE PROSPECTUS YOU ARE SEEKING TO ACCESS ARE BEING MADE
AVAILABLE ON THIS WEBSITE BY SHRIRAM TRANSPORT FINANCE COMPANY LIMITED, JM FINANCIAL
CONSULTANTS PRIVATE LIMITED, ICICI SECURITIES LIMITED AND R.R. INVESTORS CAPITAL
SERVICES PRIVATE LIMITED IN GOOD FAITH.

PLEASE NOTE THAT MAKING PRESS ANNOUNCEMENTS AND OTHER DOCUMENTS AVAILABLE IN
ELECTRONIC FORMAT DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN
OFFER TO BUY SECURITIES OF SHRIRAM TRANSPORT FINANCE COMPANY LIMITED. FURTHER, IT DOES
NOT CONSTITUTE A RECOMMENDATION BY SHRIRAM TRANSPORT FINANCE COMPANY LIMITED, JM
FINANCIAL CONSULTANTS PRIVATE LIMITED, ICICI SECURITIES LIMITED AND/OR R.R.
INVESTORS CAPITAL SERVICES PRIVATE LIMITED AND/OR ANY OTHER PARTY TO SELL OR BUY
SECURITIES OF SHRIRAM TRANSPORT FINANCE COMPANY LIMITED.

ANY POTENTIAL INVESTOR SHOULD NOTE THAT INVESTMENT IN DEBT SECURITIES

INVOLVES A HIGH DEGREE OF RISK. FOR FURTHER DETAILS, PLEASE SEE THE SECTION
TITLED “RISK FACTORS” IN THE PROSPECTUS. INVESTORS ARE URGED TO INVEST ONLY ON
THE BASIS OF THE INFORMATION CONTAINED IN THE PROSPECTUS.
 Prospectus

May 6, 2010

Shriram Transport Finance Company Limited

A Public Limited Company Incorporated under the Companies Act, 1956 (Registered as a Non-Banking Financial Company within the meaning of the Reserve Bank of India Act, 1934 (2 of 1934))
Registered Office: 123, Angappa Naicken Street, Chennai – 600 001, Tamil Nadu, India Corporate Office: Wockhardt Towers, Level – 3, West Wing, C-2, G Block, Bandra-Kurla Complex, Bandra
(East), Mumbai – 400 051 Tel. No.: +91-22-4095 9595 Fax: +91-22-4095 9596/97 Website: www.stfc.in Compliance Officer and Contact Person: Mr. K. Prakash; E-mail: stfcncd2@stfc.in

Public Issue by Shriram Transport Finance Company Limited, (“Company” or “Issuer”) of Non-Convertible Debentures of face value of Rs.1,000 each, (“NCDs”),
aggregating upto Rs. 25,000 lacs with an option to retain over-subscription upto Rs. 25,000 lacs for issuance of additional NCDs aggregating to a total of upto Rs. 50,000
lacs, hereinafter referred to as the “Issue” including a reservation for unsecured NCDs, (“Unsecured NCDs”), aggregating upto Rs. 20,000 lacs. The Unsecured NCDs
will be in the nature of subordinated debt and will be eligible for Tier II capital.

GENERAL RISK
Investors are advised to read the Risk Factors carefully before taking an investment decision in the Issue. For taking an investment decision, the investors must rely on their own examination of the
Issuer and the Issue including the risks involved. Specific attention of the investors is invited to the Risk Factors on pages xi to xxxi of this Prospectus.
ISSUER’S ABSOLUTE RESPONSIBILITY
The Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Prospectus contains all information with regard to the Issuer and the Issue, which is material in the
context of the Issue, that the information contained in this Prospectus is true and correct in all material respects and is not misleading in any material respect, that the opinions and intentions
expressed herein are honestly held and that there are no other facts, the omission of which makes this Prospectus as a whole or any of such information or the expression of any such opinions or
intentions misleading in any material respect.
CREDIT RATING
The Secured NCDs proposed to be issued under this Issue have been rated ‘CARE AA+’ by CARE for an amount of upto Rs. 50,000 Lacs and ‘AA/Stable’ by CRISIL for an amount of upto Rs.
50,000 Lacs vide their letters dated April 19, 2010 and April 27, 2010, respectively and the Unsecured NCDs proposed to be issued under this Issue have been rated ‘CARE AA’ by CARE for an
amount of upto Rs. 50,000 Lacs and ‘AA/Stable’ by CRISIL for an amount of upto Rs. 50,000 Lacs vide their letters dated April 19, 2010 and April 27, 2010, respectively. The rating of the Secured
NCDs as well as the Unsecured NCDs by CARE indicates high safety for timely servicing of debt obligations and carrying low credit risk while the rating of the Secured NCDs as well as the
Unsecured NCDs by CRISIL indicates stability.The ratings provided by CARE and/or CRISIL may be suspended, withdrawn or revised at any time by the assigning rating agency and should be
evaluated independently of any other rating. These ratings are not a recommendation to buy, sell or hold securities and investors should take their own decisions. Please refer to page 42 for rationale
for the above ratings.
LISTING
The NCDs offered through this Prospectus are proposed to be listed on the National Stock Exchange of India Limited (“NSE”). Our Company has obtained an ‘in-principle’ approval for the Issue
from the NSE. For the purposes of the Issue, NSE shall be the Designated Stock Exchange.
Lead Managers to the Issue Co-Lead Manager to the Issue Registrar to the Issue

JM Financial Consultants Private Limited ICICI Securities Limited RR Investors Capital Services Private Integrated Enterprises (India) Limited
141 Maker Chambers III Limited 2nd Floor,
Nariman Point ICICI Centre, H.T. Parekh Marg, 133A, Mittal Tower, Nariman Point, Kences Towers,
Mumbai – 400 021 Churchgate Mumbai - 400021 No. 1, Ramakrishna Street,
Tel : +91 22 6630 3030 Mumbai- 400 020 Tel : + 91 22 22886627 North Usman Road, T. Nagar,
Fax: +91 22 2204 2137 Tel: +91 22 2288 2460 Fax: + 91 22 22851925 Chennai - 600 017
Email: STFCBondIssue@jmfinancial.in Fax:+91 22 22826580 Email: stfcncd2@rrfcl.com Tel:+91 44 2814 0801/03
Investor Grievance Email: Email: stfc.debtissue@icicisecurities.com Investor Grievance Email: Fax: +91 44 2814 2479
grievance.ibd@jmfinancial.in Investor Grievance Email: rrinvestors@rrfcl.com Email: stfcipo@iepindia.com
Website: www.jmfinancial.in customercare@icicisecurities.com Website: www.rrfcl.com/ www.rrfinance.com Investor Grievance Email:
Contact Person : Ms. Lakshmi Lakshmanan Website: www.icicisecurities.com Contact Person: Mr. Brahmdutta Singh sureshbabu@iepindia.com
SEBI Registration No.: INM000010361 Contact Person: Mr. Mangesh Ghogle / Mr. SEBI Registration No: INM000007508 Website: www.iepindia.com
Johnny Barnett Contact Person: Ms. Anusha N.
SEBI Registration No: INM000011179 SEBI Registration No.: INR000000544

ISSUE PROGRAMME
ISSUE OPENS ON : May 17, 2010 ISSUE CLOSES ON : May 31, 2010

The subscription list for the Issue shall remain open for subscription at the commencement of banking hours and close at the close of banking hours on the dates indicated above or earlier or on such
date as may be decided at the discretion of the Committee of Directors of our Company subject to necessary approvals. In the event of such early closure of subscription list of the Issue, our Company
shall ensure that notice of such early closure is given at least three days prior to such early date of closure.

IDBI Trusteeship Services Limited has by its letter dated April 12, 2010 given its consent for its appointment as Debenture Trustee to the Issue and for its name to be included in this Prospectus and
in all the subsequent periodical communications sent to the holders of the Debentures issued pursuant to this Issue.

A copy of the final Prospectus shall be filed with the Registrar of Companies, Chennai, Tamil Nadu, in terms of section 56 and section 60 of the Act, along with the requsite endorsed/certified copies
of all requisite documents. For further details please refer to the section titled “Material Contracts and Documents for Inspection” beginning on page 226 of this Prospectus.
 TABLE OF CONTENTS

SECTION I : GENERAL ................................................................................................................................................................................i

Definitions / Abbreviations ................................................................................................................................................................................i
Forward Looking Statements...........................................................................................................................................................................vii
Presentation of Financial and Other Information……………………………………………………………………………………...………ix
SECTION II : RISK FACTORS...................................................................................................................................................................xi
SECTION III : INTRODUCTION ..............................................................................................................................................................32
General Information ........................................................................................................................................................................................32
Summary of Business, Strength & Strategy ....................................................................................................................................................45
The Issue .........................................................................................................................................................................................................51
Summary Financial Information......................................................................................................................................................................55
Capital Structure..............................................................................................................................................................................................68
Objects of the Issue .........................................................................................................................................................................................91
Statement of Tax Benefits ...............................................................................................................................................................................92
SECTION IV : ABOUT THE ISSUER COMPANY AND THE INDUSTRY .........................................................................................94
Industry............................................................................................................................................................................................................94
Our Business..................................................................................................................................................................................................101
History, Main Objects and Key Agreements .................................................................................................................................................119
Our Management ...........................................................................................................................................................................................127
Our Promoter .................................................................................................................................................................................................138
Our Subsidiaries ............................................................................................................................................................................................141
SECTION V : FINANCIAL INFORMATION.........................................................................................................................................142
Disclosures on Existing Financial Indebtedness............................................................................................................................................143
Material Developments .................................................................................................................................................................................160
SECTION VI : ISSUE RELATED INFORMATION ..............................................................................................................................161
Terms Of The Issue .......................................................................................................................................................................................161
Issue Structure ...............................................................................................................................................................................................165
Issue Procedure..............................................................................................................................................................................................188
SECTION VII : LEGAL AND OTHER INFORMATION .....................................................................................................................201
Pending Proceedings and Statutory Defaults .................................................................................................................................................201
Other Regulatory and Statutory Disclosures .................................................................................................................................................203
Regulations and Policies................................................................................................................................................................................217
Summary of Key Provisions of Articles of Association................................................................................................................................224
Material Contracts and Documents for Inspection ........................................................................................................................................226
Declaration ....................................................................................................................................................................................................228

-b-
 SECTION I : GENERAL

DEFINITIONS / ABBREVIATIONS

Company related terms

Term Description

"STFCL", "Issuer", “the Company” and
“our Company”
Shriram Transport Finance Company Limited, a company
incorporated under the Companies Act, 1956, registered as a Non-
Banking Financial Company with the Reserve Bank of India under Section
45-IA of the Reserve Bank of India Act, 1934, and having its Registered
Office at 123, Angappa Naicken Street, Chennai – 600 001

Act The Companies Act, 1956, as amended from time to time

AOA/Articles / Articles of Association Articles of Association of our Company

Axis Bank Axis Bank Limited (Formerly known as UTI Bank Limited)

Board / Board of Directors The Board of Directors of our Company and includes any Committee thereof

BSE Bombay Stock Exchange Limited

CAGR Compounded Annual Growth Rate

CAR Capital Adequacy Ratio

CARE Credit Analysis & Research Limited

CDSL Central Depository Services (India) Limited

CRISIL Crisil Limited

D&B Research Report The May 2010 report prepared by Dun and Bradstreet

Debentures / NCDs Redeemable, Non-Convertible Debentures offered through this Prospectus

aggregating upto Rs. 25,000 lacs with an option to retain over-subscription
upto Rs. 25,000 lacs for issuance of additional NCDs aggregating to a total of
upto Rs. 50,000 lacs including Unsecured Debentures and Secured
Debentures.

Debenture Holder (s) The holders of the NCDs

Debt Listing Agreeement The listing agreement entered into/to be entered into between the Company
and the relevant stock exchange(s) in connection with the listing debt
securities of the Company

Debt Regulations SEBI (Issue and Listing of Debt Securities) Regulations, 2008, issued by
SEBI, effective from June 6, 2008 as amended from time to time

Depositories Act The Depositories Act, 1996, as amended from time to time

Depository(ies) National Securities Depository Limited (NSDL) and /or Central

-i-
Term Description
Depository Services (India) Limited (CDSL)

DP / Depository Participant A depository participant as defined under the Depositories Act

Designated Stock Exchange National Stock Exchange of India Limited

ESOP/ESOS Company’s Employee Stock Option Scheme 2005.

Equity Shares Equity shares of face value of Rs 10/- each of our Company

FEMA Foreign Exchange Management Act, 1999, as amended from time to time

FII/FIIs Foreign Institutional Investor(s)

FITCH Fitch Ratings India Private Limited

GoI Government of India

IRDA Insurance Regulatory and Development Authority

IT Act The Income Tax Act, 1961, as amended from time to time

Loan Assets Assets under financing activities

MIS Management Information System of our Company

Memorandum / MOA Memorandum of Association of our Company

MCA Ministry of Corporate Affairs, Government of India

MSE Madras Stock Exchange Limited

NEFT National Electronic Funds Transfer

Net Loan Assets Assets under financing activities net of Provision for non-performing assets

NAV Net Asset Value

NBFC Non-Banking Financial Company as defined under Section 45-IA of the RBI
Act, 1934

NECS National Electronic Clearing Services

NPA Non Performing Asset

NSDL National Securities Depository Limited

NSE National Stock Exchange of India Limited

Promoter Shriram Holdings (Madras) Private Limited

RBI The Reserve Bank of India

- ii -
Term Description

RBI Act The Reserve Bank of India Act, 1934 , as amended from time to time

Rs./ INR/ Rupees The lawful currency of the Republic of India

ROC Registrar of Companies

RTGS Real Time Gross Settlement

SCRA Securities Contracts (Regulation) Act, 1956, as amended from time to time

SCRR The Securities Contracts (Regulation) Rules, 1957, as amended from time
to time

SCL Shriram Capital Limited (Formerly known as Shriram Financial Services

Holdings Private Limited)

SEBI The Securities and Exchange Board of India constituted under the
Securities and Exchange Board of India Act, 1992

SEBI Act The Securities and Exchange Board of India Act, 1992 as amended from
time to time

SIL Shriram Investments Limited

SOFL Shriram Overseas Finance Limited

Statutory Auditors/Joint Auditors Our joint auditors being M/s. S. R. Batliboi & Co. and M/s. G. D. Apte &
Co.

Subsidiaries Subsidiaries of our Company namely Shriram Equipment Finance

Company Limited and Shriram Automall India Limited

WDM Wholesale Debt Market

“We”, “us” and “our” Our Company and/or its Subsidiaries, unless the context otherwise requires

Issue related terms

Term Description

Allotment / Allotted Unless the context otherwise requires, the allotment of the NCDs pursuant
to the Issue to the Allottees

Allottee The successful applicant to whom the NCDs are being/have been allotted

Application Form The form used by an applicant to apply for NCDs being issued through the
Prospectus
The bank(s) with whom Escrow Accounts will be opened as specified on
Bankers to the Issue/Escrow
page 35 of this Prospectus
Collection Banks

- iii -
Term Description
Public Issue of NCDs by our Company aggregating upto Rs. 25,000 lacs
Base Issue

Basis of Allotment The basis on which NCDs will be allotted to applicants under the Issue and
which is described in “Issue Procedure – Basis of Allotment” on page 197
of this Prospectus.

Co-Lead Manager RR Investors Capital Services Private Limited

Debt Listing Agreement Listing Agreement to be entered into by the issuer company with the stock
exchanges for the purpose of listing and issuance of debt securities in
accordance with SEBI (Issue and Listing of Debt Securities) regulations,
2008

Draft Prospectus / Draft Offer This draft prospectus dated April 20, 2010 filed with NSE for receiving
Document public comments in accordance with the provisions of the Act and the Debt
Regulations

DIN Director Identification Number

Escrow Agreement Agreement dated May 5, 2010 entered into amongst our Company, the
Registrar, the Escrow Collection Bank(s), the Lead Managers and Co-Lead
Manager for collection of the application amounts and for remitting
refunds, if any, of the amounts collected, to the applicants on the terms and
conditions contained therein

Escrow Account Accounts opened in connection with the Issue with the Escrow Collection
Banks and in whose favour the applicant will issue cheques or bank drafts
in respect of the application amount while submitting the application

Issue Public Issue by our Company of NCDs aggregating upto Rs. 25,000 lacs with
an option to retain over-subscription upto Rs. 25,000 lacs for issuance of
additional NCDs aggregating to a total of upto Rs.50,000 lacs including a
reservation for Unsecured NCDs aggregating upto Rs. 20,000 lacs. The
Unsecured NCDs will be in the nature of subordinated debt and will be
eligible for Tier II capital.

Issue Opening Date May 17, 2010

Issue Closing Date∗ May 31, 2010

Bajaj Capital Investor Services Limited, Karvy Stock Broking Limited,
Lead Brokers
Edelweiss Securities Limited, Enam Securities Private Limited, Kotak
Securities Limited, SMC Global Securities Limited, Integrated Securities
Limited and HDFC Securities Limited

Lead Managers JM Financial Consultants Private Limited and ICICI Securities Limited

Options Options being offered to the applicants as stated in the section titled ‘Issue
Related Information’ at page 161 of this Prospectus

Prospectus / Offer Document The Prospectus dated May 6, 2010 issued and filed/to be filed with the ROC
in accordance with the Debt Regulations containing inter alia the coupon rate
for the NCDs and certain other information

- iv -
 Term Description

Registrar to the Issue Integrated Enterprises (India) Limited

Reserved Individual Portion Applicants in Category III who apply for NCDs aggregating to a value not
more than Rs. 5 Lac, across all series of NCDs irrespective of whether they
are Secured NCDs or Unsecured NCDs, (Option I, Option II, Option III
,Option IV and/or Option V), shall be grouped together,

Secured NCDs NCDs offered under this Issue which are secured by a charge on the assets of
our Company, namely the NCDs issued under Option I, Option II and Option
III as detailed in this Prospectus.

Senior Citizen Any person who has completed the age of 60 years as on the date of
Prospectus

Trustees / Debenture Trustee Trustees for the Debenture Holders in this case being IDBI Trusteeship
Services Limited

Unreserved Individual Portion Applicants in Category III who apply for NCDs aggregating to a value
exceeding Rs. 5 Lac, across all series of NCDs, irrespective of whether they
are Secured NCDs or Unsecured NCDs, (Option I, Option II, Option III
Option ,IV and/or Option V), shall be separately grouped together

Unsecured NCDs NCDs offered under this Issue which are not secured by any charge on the
assets of our Company, namely the NCDs issued under Option IV and Option
V, which will be in the nature of subordinated debt and will be eligible for
Tier II capital, as detailed in this Prospectus.
∗The subscription list for the public issue shall remain open for subscription at the commencement of banking hours and close at
the close of banking hours on the dates indicated or earlier or on such date as may be decided at the discretion of the Board of
Directors or any committee of our Company subject to necessary approvals

Technical & Industry Terms

Term Description

AFC Asset Finance Company

ALM Asset Liability Management

CV Commercial Vehicle

FTU(s) First Time Users

LC Loan Company

LCV(s) Light Commercial Vehicles

SME Small and Medium Enterprises

SRTO(s) Small Road Transport Operators

STO(s) Small Truck Owners

-v-
Conventional / General Terms

Term Description

AGM Annual General Meeting

AS Accounting Standard

DRR Debenture Redemption Reserve

EGM Extraordinary General Meeting

EPS Earnings Per Share

Financial Year / FY Financial Year ending March 31

GDP Gross Domestic Product

GIR General Index Registration Number

HUF Hindu Undivided Family

Indian GAAP Generally Accepted Accounting Principles in India

NRI Non Resident Indian

PAN Permanent Account Number

SBI State Bank of India

TDS Tax Deducted at Source

- vi -
 FORWARD LOOKING STATEMENTS

Certain statements contained in this Prospectus that are not statements of historical fact constitute “forward-looking
statements.” Investors can generally identify forward-looking statements by terminology such as “aim”, “anticipate”,
“believe”, “continue”, “could”, “estimate”, “expect”, “intend”, “may”, “objective”, “plan”, “potential”, “project”,
“pursue”, “shall”, “should”, “will”, “would”, or other words or phrases of similar import. All statements regarding
our Company’s expected financial condition and results of operations and business plans and prospects are forward-
looking statements. These forward-looking statements include statements as to our Company’ business strategy,
revenue and profitability, planned projects and other matters discussed in this Prospectus that are not historical facts.
These forward-looking statements and any other projections contained in this Prospectus (whether made by our
Company or any third party) are predictions and involve known and unknown risks, uncertainties, assumptions and
other factors that may cause our Company’s actual results, performance or achievements to be materially different
from any future results, performance or achievements expressed or implied by such forward-looking statements or
other projections. All forward-looking statements are subject to risks, uncertainties and assumptions about our
Company 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 Company’s
expectations include, among others:

• General economic and business conditions in India and globally;

• Our ability to successfully implement our strategy, our growth and expansion plans and technological
changes;

• Our ability to compete effectively and access funds at competitive cost;

• Changes in the value of Rupee and other currency changes;

• Unanticipated turbulence in interest rates, equity prices or other rates or prices; the performance of the
financial and capital markets in India and globally;

• Availability of funds and willingness of our lenders to lend;

• Changes in political conditions in India;

• The rate of growth of our loan assets;

• The outcome of any legal or regulatory proceedings we are or may become a party to;

• Changes in Indian and/or foreign laws and regulations, including tax, accounting, banking, securities,
insurance and other regulations; changes in competition and the pricing environment in India; and regional
or general changes in asset valuations;

• Changes in laws and regulations that apply to NBFCs in India, including laws that impact our lending rates
and our ability to enforce our collateral;

• Emergence of new competitors;

• Growth of transportation services in India;

• Performance of the Indian debt and equity markets;

- vii -
• Occurrence of natural calamities or natural disasters affecting the areas in which our Company has
operations; and

• Other factors discussed in this Prospectus, including under the section titled “Risk Factors” beginning on
page xi of this Prospectus.

All forward-looking statements are subject to risks, uncertainties and assumptions about our Company that could
cause actual results and valuations to differ materially from those contemplated by the relevant statement.
Additional factors that could cause actual results, performance or achievements to differ materially include, but are
not limited to, those discussed under the sections titled “Industry” and “Our Business”. The forward-looking
statements contained in this Prospectus are based on the beliefs of management, as well as the assumptions made by
and information currently available to management. Although our Company believes that the expectations reflected
in such forward-looking statements are reasonable at this time, it cannot assure investors that such expectations will
prove to be correct or will hold good at all times. Given these uncertainties, investors are cautioned not to place
undue reliance on such forward-looking statements. If any of these risks and uncertainties materialise, or if any of
our Company’s underlying assumptions prove to be incorrect, our Company’s actual results of operations or
financial condition could differ materially from that described herein as anticipated, believed, estimated or expected.
All subsequent forward-looking statements attributable to our Company are expressly qualified in their entirety by
reference to these cautionary statements. Neither our Company, our Directors and Officers 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

- viii -
 PRESENTATION OF FINANCIAL AND OTHER INFORMATION

General

In this Prospectus, unless the context otherwise indicates or implies, references to “you,” “offeree,” “purchaser,”
“subscriber,” “recipient,” “investors” and “potential investor” are to the prospective investors in this Offering,
references to our “Company”, the “Company” or the “Issuer” are to Shriram Transport Finance Company Limited.

In this Prospectus, references to “US$” is to the legal currency of the United States and references to “Rs.” and
“Rupees” are to the legal currency of India. All references herein to the “U.S.” or the “United States” are to the
United States of America and its territories and possessions and all references to “India” are to the Republic of India
and its territories and possessions, and the "Government", the "Central Government" or the "State Government" are
to the Government of India, central or state, as applicable.

Unless otherwise stated, references in this Prospectus to a particular year are to the calendar year ended on
December 31 and to a particular “fiscal” or “fiscal year” are to the fiscal year ended on March 31.

Unless otherwise stated all figures pertaining to the financial information in connection with our Company are on an
unconsolidated basis.

Presentation of Financial Information

Our Company publishes its financial statements in Rupees. Our Company’s financial statements are prepared in
accordance with Indian GAAP and the Companies Act. Unless otherwise indicated, Unless otherwise indicated, all
financial data in this Prospectus are derived from our Company’s Reformatted Summary Financial Statements
(defined hereinafter). Indian GAAP differs in certain significant respects from International Financial Reporting
Standards, (“IFRS”), and U.S. GAAP. Our Company does not provide a reconciliation of its financial statements to
IFRS or U.S. GAAP financial statements. We have not attempted to explain those differences or quantify their
impact on the financial information included herein, and we urge you to consult your own advisors regarding such
differences and their impact on our financial information. Accordingly, the degree to which the Reformatted
Summary Financial Statements (defined hereinafter) included in this Prospectus will provide meaningful
information is entirely dependent on the reader’s level of familiarity with the respective accounting practices.

Our audited unconsolidated financial statements as at and for the years ended March 31, 2005 and March 31, 2006
as audited by our Company’s statutory auditor, M/s. G. D. Apte & Co., and our audited unconsolidated financial
statements as at and for the years ended March 31, 2007, March 31, 2008, March 31, 2009, March 31, 2010 and as at
and for the nine month period from April 1, 2009 to December 31, 2009 as jointly audited by our Company’s
Statutory Auditors, M/s. S. R. Batliboi & Co. and M/s.G. D. Apte & Co. form the basis of the statement of
reformatted unconsolidated assets and liabilities of the our Company and the reformatted unconsolidated profit and
loss account and the statement of reformatted unconsolidated cash flow as at and for the years ended March 31,
2005, 2006, 2007, 2008, 2009, 2010 and as at and for the nine months period between April 1, 2009 to December
31, 2009, (“Reformatted Unconsolidated Summary Financial Statements”). The consolidated balance sheet of
the Company, its subsidiaries and associate (collectively referred to as the “Group”) as at December 31, 2009, and
as at March 31, 2010 and the related consolidated profit and loss account and consolidated cash flow statement for
the nine month period from April 1, 2009 to December 31, 2009, and for the financial year ended March 31, 2010,
form the basis for the statement of reformatted consolidated assets and liabilities of the Group as at December 31,
2009, and as at March 31, 2010 and the statement of reformatted consolidated profit and loss account and the
statement of reformatted consolidated cash flow for the nine month period ended December 31, 2009 and for the
financial year ended March 31, 2010, (“Reformatted Consolidated Summary Financial Statements”). The
Reformatted Unconsolidated Summary Financial Statements and the Reformatted Consolidated Summary Financial
Statements are included in this Prospectus and collectively referred to hereinafter as the “Reformatted Summary
Financial Statements”. The examination reports of our Company’s Statutory Auditors, M/s. S. R. Batliboi & Co.
and M/s.G. D. Apte & Co.on the Reformatted Summary Financial Statements are included in this Prospectus.

Any discrepancies in the tables included herein between the amounts listed and the totals thereof are due to rounding
off.
- ix -
Unless stated otherwise, macroeconomic and industry data used throughout this Prospectus has been obtained from
publications prepared by providers of industry information, government sources and multilateral institutions. Such
publications generally state that the information contained therein 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
the Issuer believes that industry data used in this Prospectus is reliable, it has not been independently verified.

Our Company has obtained and relied upon certain information in relation to its market position on the May 2010
report prepared by Dun and Bradstreet, (the “D&B Research Report”). Such information is included in this
Prospectus and identified by “Source: Dun & Bradstreet Research Report”. The D&B Research Report is based on a
preliminary study of select leading NBFCs in the commercial vehicle financing sector and is restricted to seven
NBFCs selected for the purposes of the reseach conducted by Dun and Bradstreet in connection with the D&B
Research Report, which includes our Company, Cholamandalam DBS Finance Limited, Magma Fincorp Limited,
Mahindra & Mahindra Financial Services Limited, Shriram City Union Finance Limited, Sundaram Finance Limited
and Indiabulls Financial Services Limited. The D&B Reaserch Report, based on financial and non financial
parameters for the financial year 2009, determines the relative positions of the aforementioned seven NBFCs in the
industry. The information contained in the D&B Research Report has not been verified by our Company, the Lead
Managers, the Co-Lead Manager or any other independent source. There can be no assurance that the basis of the
data included in the D&B Research Report or the findings thereof are completely accurate or reliable. Accordingly,
investors are advised not to place undue reliance on the data derived from the D&B Research Report in their
investment decision relating to our Company.

-x-
 SECTION II : RISK FACTORS

Prospective investors should carefully consider the risks and uncertainties described below, in addition to the other
information contained in this Prospectus before making any investment decision relating to the NCDs. If any of the
following risks or other risks that are not currently known or are now deemed immaterial, actually occur, our
business, financial condition and result of operation could suffer, the trading price of the NCDs could decline and
you may lose your all or part of your interest and / or redemption amounts. Unless otherwise stated in the relevant
risk factors set forth below, we are not in a position to specify or quantify the financial or other implications of any
of the risks mentioned herein. The ordering of the risk factors is intended to facilitate ease of reading and reference
and does not in any manner indicate the importance of one risk factor over another.

This Prospectus contains forward looking statements that involve risk and uncertainties. Our Company’s actual
results could differ materially from those anticipated in these forward looking statements as a result of several
factors, including the considerations described below and elsewhere in this Prospectus.

Investors are advised to read the following risk factors carefully before making an investment in the NCDs offered
in this Issue. You must rely on your own examination of our Company and this Issue, including the risks and
uncertainties involved.

INTERNAL RISK FACTORS

Risks relating to our Company and its Business

1. Our financial performance is particularly vulnerable to interest rate volatility.

Our results of operations are substantially dependent upon the level of our Net Interest Margins. Finance
and service charges, or interest income from our assets under financing activities, is the largest component
of our total income, and constituted 86.95% and 85.04% of our total income in fiscal 2009 and the nine
month period ended December 31, 2009, respectively. We provide loans at fixed rates of interest. As of
December 31, 2009, our assets under financing activities was Rs. 2,154,250.82 lacs. We borrow funds on
both fixed and floating rate basis. Volatility in interest rates can materially and adversely affect our
financial performance. In a rising interest rate environment, if the yield on our interest-earning assets does
not increase simultaneously with or to the same extent as our cost of funds, or, in a declining interest rate
environment, if our cost of funds does not decline simultaneously or to the same extent as the yield on our
interest-earning assets, our net interest income and net interest margin would be adversely impacted.
Additional risks arising from increasing interest rates, among others, include:

• increases in the rates of interest charged on various loans in our loan portfolio, which could result in
the extension of loan maturities and higher monthly installments due from borrowers which, in turn,
could result in higher rates of default;

• reductions in the volume of commercial vehicle loans as a result of clients' inability to service high
interest rate payments; and

• reduction in the value of fixed income securities held in our investment portfolio.

Accordingly, our operations are susceptible to fluctuations in interest rates. Interest rates are highly
sensitive and fluctuations thereof are dependant upon many factors which are beyond our control, including
the monetary policies of the RBI, de-regulation of the financial services sector in India, domestic and
international economic and political conditions, inflation and other factors. Difficult conditions in the
global and Indian economy resulting from the economic dislocations and liquidity disruptions of the credit
crisis since 2008 adversely affected the availability of credit. While credit conditions have eased in recent
months, decreased liquidity resulting from the economic downturn led to an increase in interest rates on

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 loans provided by banks and financial institutions, and market interest rates in India have been volatile in
recent periods.

2. Our business requires substantial capital, and any disruption in funding sources would have a material
adverse effect on our liquidity and financial condition.

As an asset finance company, our liquidity and ongoing profitability are, in large part, dependent upon our
timely access to, and the costs associated with, raising capital. Our funding requirements historically have
been met from a combination of term loans from banks and financial institutions, issuance of redeemable
non-convertible debentures, public deposits, the issue of subordinated bonds and commercial paper, as well
as through securitization/assignment of our loan portfolio. Thus, our business depends and will continue to
depend on our ability to access diversified funding sources. Our ability to raise funds on acceptable terms
and at competitive rates continues to depend on various factors including our credit ratings, the regulatory
environment and policy initiatives in India, developments in the international markets affecting the Indian
economy, investors' and/or lenders' perception of demand for debt and equity securities of NBFCs, and our
current and future results of operations and financial condition.

Our funding strategy was adversely affected by the ongoing crisis in the global credit markets since 2008.
These adverse conditions reached unprecedented levels through the second half of 2008 and the first half of
2009. The capital and lending markets remained highly volatile and access to liquidity was adversely
affected. These conditions resulted in increased borrowing costs and difficulty in accessing funds in a cost-
effective manner. Changes in economic and financial conditions or continuing lack of liquidity in the
market could make it difficult for us to access funds at competitive rates. As an NBFC, we also face certain
restrictions on our ability to raise money from international markets which may further constrain our ability
to raise funds at attractive rates.

Any disruption in our primary funding sources at competitive costs would have a material adverse effect on
our liquidity and financial condition.

3. Our business is focused on commercial vehicle finance for new and pre-owned commercial vehicles and
any adverse developments in this sector would adversely affect our results of operations.

As we focus on providing financing for pre-owned and new commercial vehicles, our asset and NPA
portfolios have, and will likely continue in the future to have, a high concentration of pre-owned and new
commercial vehicle financing arrangements. Moreover, our customer base has, and will likely continue in
the future to have, a high concentration of FTUs and SRTOs. Our business is, therefore, entirely dependent
on various factors that impact this customer segment, such as the demand for transportation services in
India, changes in Indian regulations and policies affecting pre-owned commercial vehicles, natural disasters
and calamities, and macroeconomic environment in India and globally. Also, individual borrowers and
FTUs and SRTOs generally are less financially resilient than larger corporate borrowers or fleet owners,
and, as a result, can be more adversely affected by declining economic conditions. Such factors may result
in a decline in the sales or value of new and pre-owned commercial vehicles. Correspondingly, the demand
for finance for pre-owned and new commercial vehicles may decline, which in turn may adversely affect
our financial condition and the results of our operations. Further, the ability of commercial vehicle owners
and/or operators to perform their obligations under existing financing agreements may be adversely
affected if their businesses suffer as a result of the aforesaid factors.

Accordingly, since our business is not a diversified business, any factor which adversely impacts this
segment may have a disproportionate impact on our operations and profitability.

4. High levels of customer defaults could adversely affect our business, financial condition and results of
operations.

Our primary business involves lending money to commercial vehicle owners and operators in India, and we
are subject to customer default risks including default or delay in repayment of principal or interest on our
loans. Customers may default on their obligations to us as a result of various factors including bankruptcy,

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 lack of liquidity and operational failure. If borrowers fail to repay loans in a timely manner or at all, our
financial condition and results of operations will be adversely impacted.

In addition, our customer portfolio principally consists of SRTOs and FTUs with underdeveloped banking
habits, and individual borrowers generally are less financially resilient than larger corporate borrowers,
and, as a result, they can be more adversely affected by declining economic conditions. In addition, a
significant majority of our client base belongs to the low income group. The owners and/or operators of
commercial vehicles financed by us often do not have any credit history supported by tax returns and other
related documents which would enable us to assess their creditworthiness. In addition, we may not receive
updated information regarding any change in the financial condition of our customers or may receive
inaccurate or incomplete information as a result of any fraudulent misrepresentation on the part of our
customers. Furthermore, unlike several developed economies, a nationwide credit bureau has only recently
become operational in India, so there is less financial information available about the creditworthiness of
individuals, particularly our client segment who are mainly from the low income group and who typically
have limited access to other financing sources. It is therefore difficult to carry out precise credit risk
analyses on our clients. Although we follow certain procedures to evaluate the credit profile of our
customers at the time of sanctioning a loan, we generally rely on the referrals from the local trucking
community and value of the commercial vehicle provided as underlying collateral rather than on a stringent
analysis of the credit profile of our customers. Although we believe that our risk management controls are
sufficient, we cannot be certain that they will continue to be sufficient or that additional risk management
policies for individual borrowers will not be required. Failure to continuously monitor the loan contracts,
particularly for individual borrowers, could adversely affect our credit portfolio which could have a
material and adverse effect on our results of operations and financial condition.

5. We may not be able to recover, on a timely basis or at all, the full value of collateral or amounts which
are sufficient to cover the outstanding amounts due under defaulted loans.

As a security interest for the financing facilities provided by us to our customers, the vehicles purchased by
our customers are hypothecated in our favor. The value of the vehicle, however, is subject to depreciation,
deterioration, and/or reduction in value on account of other extraneous reasons, over the course of time.
Consequently, the realizable value of the collateral for the credit facility provided by us, when liquidated,
may be lower than the outstanding loan from such customers. Any default in repayment of the outstanding
credit obligations by our customers may expose us to losses. Furthermore, in the case of a default, we
typically repossess the commercial vehicles financed and sell such vehicles through auctions. The
hypothecated vehicles, being movable property, may be difficult to locate or seize in the event of any
default by our customers. There can also be no assurance that we will be able to sell such vehicles provided
as collateral at prices sufficient to cover the amounts under default. In addition, there may be delays
associated with such process. A failure or delay to recover the expected value from sale of collateral
security could expose us to a potential loss. Any such losses could adversely affect our financial condition
and results of operations. Furthermore, enforcing our legal rights by litigating against defaulting customers
is generally a slow and potentially expensive process in India. Accordingly, it may be difficult for us to
recover amounts owed by defaulting customers in a timely manner or at all. The recovery of monies from
defaulting customers may be further compounded by the fact that we do not generally insist on, or receive
post dated cheques as security towards the timely repayment of dues from customers to whom we have
provided loans.

6. The Company is involved in certain legal proceedings for alleged contravention of certain State
legislations in India relating to “money lending” activities. Any unfavorable outcome in such
proceedings and the imposition of any additional restrictive statutory and/or regulatory requirements
may adversely affect our goodwill, business prospects and results of operations.

Certain criminal proceedings have been initiated against the Company and our Managing Director by the
State of Gujarat and the Inspector of Money Lenders, Gujarat in connection with the alleged contravention
of the Bombay Money Lenders Act, 1946, as amended (“BMLA”), before the Metropolitan Magistrate,
Ahmedabad. The complainants have, among other allegations, asserted that the conduct of our financing
business without the requisite license under the BMLA is in contravention of such legislation. Accordingly,
the complainants have sought to prosecute and penalize the Company and our Managing Director under
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 Section 34 of the BMLA. We filed an application under Section 482 of the Code of Criminal Procedure,
1973 against the State of Gujarat and the Inspector of Money Lenders, Gujarat before the High Court of
Gujarat at Ahmedabad (“Quashing Application”), seeking to quash such criminal proceedings, and
seeking an order for the stay of such criminal proceedings during the pendency of the Quashing
Application. These proceedings initiated against the Company and our Managing Director, and the
application filed by the Company, are currently pending hearing and final disposition. Under the provisions
of the BMLA, any person who carries out the business of “money lending” (as defined therein) within the
states of Maharashtra and Gujarat without a valid license for such business under the provisions of the
BMLA or enters into any agreement in the course of business of money lending without a valid license, is,
on conviction, punishable (i) for the first offence, with imprisonment up to one year or a fine of up to
Rs.1,500.00 or both, and (ii) for a second or subsequent offence, with additional terms of imprisonment of
not less than two years, in the case of an individual, and with additional fine of not less than Rs.5,000.00, in
the case of a corporate entity.

The Company has also filed an appeal before the Supreme Court of India against an order dated November
18, 2009 passed by the High Court of Kerala in connection with a writ petition filed by the Company
challenging the action of the Commissioner of Commercial Taxes, Kerala, directing the Company to
register under the provisions of the Kerala Money Lenders Act, 1946, as amended (“KMLA”). The High
Court of Kerala, pursuant to the impugned order, had dismissed an appeal in connection with such writ
petition, thereby, among other matters, confirming such impugned order passed by the Commissioner of
Commercial Taxes, Kerala. The Supreme Court has granted a stay of the order passed by the High Court of
Kerala until final disposal of the appeal at the Supreme Court.

There can be no assurance that these proceedings will not be determined adversely to us or that penal or
other action will not be taken against the Company and/or any senior management party to such
proceedings. In the event of an adverse ruling in these proceedings, the Company may be required to
register as a money lending entity under the provisions of the BMLA and/ or the KMLA in order to carry
on its financing business, and will be required to comply with the provisions of such legislation with
respect to its business operations within the relevant States. There can also be no assurance that in the event
of such an adverse ruling, similar regulatory authorities in other States of India where we currently carry on
business or propose to carry on business in the future, will not require us to similarly register as a money
lending entity under, and comply with the provisions of, the respective State legislation. State legislation
may specify various terms and conditions that must be complied with in connection with money lending
activities, including the imposition of maximum interest rates that we may charge, and these maximum
interest rates may be significantly lower than the interest rates that we typically charge on our portfolio
against financing activities to our customers. If we are required to comply with such maximum interest rate
limits or any other restrictive provisions specified under such legislation, our interest income and net
interest margin may be adversely impacted. There can also be no assurance that other conditions and
restrictions under such legislation, if applicable to us, will not adversely affect the conduct of our
operations.

For further information relating to such proceedings, see “Pending Proceedings and Statutory Defaults”.

7. A large part of our collections are in cash and consequently we face the risk of misappropriation or
fraud by our employees.

A significant portion of our collections from our customers is in cash. Large cash collections expose us to
the risk of fraud, misappropriation or unauthorized transactions by our employees responsible for dealing
with such cash collections. While we have taken insurance policies, including fidelity coverage and
coverage for cash in safes and in transit, and undertake measures to detect and prevent any unauthorized
transaction, fraud or misappropriation by our representatives and officers, this may not be sufficient to
prevent or deter such activities in all cases, which may adversely affect our operations and profitability.
Further, we may be subject to regulatory or other proceedings in connection with any unauthorized
transaction, fraud or misappropriation by our representatives and employees, which could adversely affect
our goodwill.

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8. Our significant indebtedness and the conditions and restrictions imposed by our financing arrangements
could restrict our ability to conduct our business and operations in the manner we desire.

As of March 31, 2010, we had outstanding secured debt of Rs. 1,517,248.07 lacs and unsecured debt of Rs.
328,742.89lacs, and we will continue to incur additional indebtedness in the future. Most of our borrowings
are secured by our immovable and other assets. Our significant indebtedness could have several important
consequences, including but not limited to the following:

• a portion of our cash flow may be used towards repayment of our existing debt, which will reduce
the availability of our cash flow to fund working capital, capital expenditures, acquisitions and
other general corporate requirements;

• our ability to obtain additional financing in the future at reasonable terms may be restricted or our
cost of borrowings may increase due to sudden adverse market conditions, including decreased
availability of credit or fluctuations in interest rates;

• fluctuations in market interest rates may affect the cost of our borrowings, as some of our
indebtedness are at variable interest rates;

• there could be a material adverse effect on our business, financial condition and results of
operations if we are unable to service our indebtedness or otherwise comply with financial and
other covenants specified in the financing agreements; and

• we may be more vulnerable to economic downturns, may be limited in our ability to withstand
competitive pressures and may have reduced flexibility in responding to changing business,
regulatory and economic conditions.

Some of our financing agreements also include various conditions and covenants that require us to obtain
lender consents prior to carrying out certain activities and entering into certain transactions. Failure to meet
these conditions or obtain these consents could have significant consequences on our business and
operations. Specifically, under some of our financing agreements, we require, and may be unable to obtain,
consents from the relevant lenders for, among others, the following matters: entering into any scheme of
merger; spinning-off of a business division; selling or transferring all or a substantial portion of our assets;
making any change in ownership or control or constitution of the Company; making amendments in our
Memorandum and Articles of Association; creating any further security interest on the assets upon which
the existing lenders have a prior charge; and raising funds by way of any fresh capital issue. Our financing
agreements also typically contain certain financial covenants including the requirement to maintain, among
others, specified debt-to-equity ratios, debt-to-net worth ratios, or Tier I to Tier II capital ratios that may be
higher than statutory or regulatory requirements. These covenants vary depending on the requirements of
the financial institution extending the loan and the conditions negotiated under each financing document.
Such covenants may restrict or delay certain actions or initiatives that we may propose to take from time to
time.

We have in the past failed to comply with certain covenants in our loan documents. However, there has
been no delay in repayment of principal amount, except on certain situations we have delayed repayment of
interest thereon. A failure to observe the covenants under our financing arrangements or to obtain necessary
consents required thereunder may lead to the termination of our credit facilities, acceleration of all amounts
due under such facilities and the enforcement of any security provided. Any acceleration of amounts due
under such facilities may also trigger cross default provisions under our other financing agreements. If the
obligations under any of our financing documents are accelerated, we may have to dedicate a substantial
portion of our cash flow from operations to make payments under such financing documents, thereby
reducing the availability of cash for our working capital requirements and other general corporate purposes.
Further, during any period in which we are in default, we may be unable to raise, or face difficulties raising,
further financing. In addition, other third parties may have concerns over our financial position and it may
be difficult to market our financial products. Furthermore, under the terms of certain of our financing
agreements, in the event of any default thereunder, the relevant lender is entitled to change the constitution

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 of our Board, including, among other matters, the appointment of new directors and/or removal of any
existing Director of the Company. Any of these circumstances could adversely affect our business, credit
rating and financial condition and results of operations. Moreover, any such action initiated by our lenders
could result in the price of our NCDs being adversely affected.

9. We face increasing competition in our business which may result in declining margins if we are unable
to compete effectively.

We primarily provide vehicle finance loans to FTUs and SRTOs. Our primary competition historically has
been private unorganized financiers who principally operate in the local market. However, the significant
growth in the commercial vehicle finance segment in recent periods has resulted in various banks and
NBFCs increasing their focus on this sector, particularly for new commercial vehicle finance. In addition,
interest rate deregulation and other liberalization measures affecting the commercial vehicle finance sector,
together with increased demand for capital by FTUs and SRTOs, have resulted in an increase in
competition. The demand for commercial vehicle finance has also increased due to relatively lower and
affordable interest rates and the increased need for urgent borrowing or bridge financing requirements
which could result in our potential customers seeking alternative cheaper sources of funding.

All of these factors have resulted in us facing increased competition from other lenders in the commercial
vehicle finance sector, including commercial banks and other NBFCs. Our ability to compete effectively
will depend, to some extent, on our ability to raise low-cost funding in the future. Furthermore, as a result
of increased competition in the commercial vehicle finance sector, vehicle finance products are becoming
increasingly standardized and variable interest rate and payment terms and lower processing fees are
becoming increasingly common in the commercial vehicle finance sector in India. There can be no
assurance that we will be able to react effectively to these or other market developments or compete
effectively with new and existing players in the increasingly competitive commercial vehicle finance
industry. Increasing competition may have an adverse effect on our net interest margin and other income,
and, if we are unable to compete successfully, our market share may decline.

In addition, we intend to expand our operations to increasingly focus on equipment finance, particularly
construction equipment, and we face significant competition from most banks and NBFCs that are already
well established in this segment. If we are unable to compete effectively with other participants in the
commercial vehicle finance or equipment finance sectors, our business, future financial performance and
the trading price of the NCDs may be adversely affected.

10. We have in the past acquired, and may continue to acquire in the future, portfolios relating to various
credit and financing facilities from banks and other institutions on a non-recourse basis. If the
performance of such portfolios deteriorates, our business, financial condition and results of operations
may be adversely affected

We have in the past acquired, and may in the future continue to acquire, portfolios relating to various credit
and financing facilities from various originators including banks and other institutions, in the ordinary
course of our business.

Notably, pursuant to the terms of an Assignment Agreement dated December 22, 2009 (the Assignment
Agreement) between the Company, GE Capital Services India and GE Capital Financial Services
(collectively, the GE Entities), we have acquired with effect from December 24, 2009 from the GE Entities,
on a non-recourse basis, a certain portfolio of receivables in connection with certain loan facilities relating
to commercial vehicle loans and construction equipment loans (the GE Receivables), together with all
right, title and interest therein under the relevant underlying loan and security documents relating to the GE
Receivables as of November 28, 2009.

11. We may not be able to successfully sustain our growth strategy.

In recent years, we have experienced substantial growth. Our growth strategy includes growing our loan
book and expanding our customer base. There can be no assurance that we will be able to sustain our

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 growth strategy successfully or that we will be able to expand further or diversify our product portfolio. If
we grow our loan book too rapidly or fail to make proper assessments of credit risks associated with new
borrowers, a higher percentage of our loans may become non-performing, which would have a negative
impact on the quality of our assets and our financial condition.

We also face a number of operational risks in executing our growth strategy. We have experienced rapid
growth in our commercial vehicle finance business, our branch network has expanded significantly, and we
are entering into new, smaller towns and cities within India as part of our growth strategy. Our rapid
growth exposes us to a wide range of increased risks, including business risks, such as the possibility that a
number of our impaired loans may grow faster than anticipated, as well as operational risks, fraud risks and
regulatory and legal risks. Moreover, our ability to sustain our rate of growth depends significantly upon
our ability to manage key issues such as selecting and retaining key managerial personnel, maintaining
effective risk management policies, continuing to offer products which are relevant to our target base of
clients, developing managerial experience to address emerging challenges and ensuring a high standard of
client service. We will need to recruit new employees, who will have to be trained and integrated into our
operations. We will also have to train existing employees to adhere properly to internal controls and risk
management procedures. Failure to train our employees properly may result in an increase in employee
attrition rates, require additional hiring, erode the quality of customer service, divert management
resources, increase our exposure to high-risk credit and impose significant costs on us.

12. We may not be able to successfully diversify our product portfolio.

We have expanded our product portfolio to provide, in addition to pre-owned and new commercial vehicle
financing, financing for passenger commercial vehicles, multi-utility vehicles, three-wheelers and tractors,
ancillary equipment and vehicle parts finance, working capital loans for commercial vehicle operators, and
freight bill discounting. Furthermore, we intend to enter into certain new lines of business as part of our
growth strategy.

For example, we intend to further develop our equipment finance business, particularly for construction
equipment, through a wholly-owned subsidiary established for this purpose. We have limited experience in
these new lines of business which are partly targeted at a different customer segment, and may encounter
additional risks by entering into such new lines of business. We also intend to develop pre-owned
commercial vehicle hubs across India called "Automalls", through a wholly-owned subsidiary which has
been incorporated for this purpose, designed to provide a trading platform for the sale of pre-owned
commercial vehicles, showrooms for branded new and refurbished pre-owned commercial vehicles, as well
as commercial vehicles repossessed by financing companies. We intend to provide electronic advertising
and trading infrastructure in these "Automalls", and to utilize this platform for marketing of our financial
products.

We cannot assure that such diversification or expansion of operations will yield favorable or expected
results, as our overall profitability and success will be subject to various factors, including, among others,
our ability to obtain necessary statutory and/or regulatory approvals in connection with such proposed
business in a timely manner, our ability to effectively recruit, retain and motivate appropriate managerial
talent, our relative inexperience in the equipment finance sector and ability to compete with banks and
other NBFCs that are already well established in this market segment, as well as our ability to effectively
absorb additional infrastructure costs. There can also be no assurance that our proposed "Automalls" will be
successful in creating additional source of business for our financial products.

New businesses will require significant capital investments and commitments of time from our senior
management, there also can be no assurance that our management will be able to develop the skills
necessary to successfully manage these new business areas. Our inability to effectively manage any of
these issues could materially and adversely affect our business and impact our future financial performance.

13. We may experience difficulties in expanding our business into new regions and markets in India.

As part of our growth strategy, we continue to evaluate attractive growth opportunities to expand our
business into new regions and markets in India. Factors such as competition, culture, regulatory regimes,
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 business practices and customs and customer requirements in these new markets may differ from those in
our current markets, and our experience in our current markets may not be applicable to these new markets.
In addition, as we enter new markets and geographical regions, we are likely to compete not only with
other banks and financial institutions but also the local unorganized or semi-organized private financiers,
who are more familiar with local regulations, business practices and customs, and have stronger
relationships with customers.

If we plan to expand our geographical footprint, our business may be exposed to various additional
challenges, including obtaining necessary governmental approvals, identifying and collaborating with local
business and partners with whom we may have no previous working relationship; successfully gauging
market conditions in local markets with which we have no previous familiarity; attracting potential
customers in a market in which we do not have significant experience or visibility; being susceptible to
local taxation in additional geographical areas of India; and adapting our marketing strategy and operations
to different regions of India in which different languages are spoken. Our inability to expand our current
operations may adversely affect our business prospects, financial conditions and results of operations.

14. Any downgrade of our credit ratings would increase borrowing costs and constrain our access to capital
and lending markets and, as a result, would negatively affect our net interest margin and our business.

The cost and availability of capital is also dependent on our short-term and long-term credit ratings. Ratings
reflect a rating agency’s opinion of our financial strength, operating performance, strategic position, and
ability to meet our obligations. In relation to our long-term debt instruments, we currently have long term
ratings of CARE AA+ from CARE and AA (Ind) from FITCH. In relation to our short-term debt
instruments, we have also received short term ratings of F1+ from FITCH and P1+ from CRISIL. The
Secured NCDs proposed to be issued under this Issue have been rated ‘CARE AA+’ by CARE for an
amount of upto Rs. 50,000 Lacs and ‘AA/Stable’ by CRISIL for an amount of upto Rs. 50,000 Lacs vide
their letters dated April 19, 2010 and April 27, 2010, respectively and the Unsecured NCDs proposed to be
issued under this Issue have been rated ‘CARE AA’ by CARE for an amount of upto Rs. 50,000 Lacs and
‘AA/Stable’ by CRISIL for an amount of upto Rs. 50,000 Lacs vide their letters dated April 19, 2010 and
April 27, 2010, respectively.

Any downgrade of our credit ratings would increase borrowing costs and constrain our access to capital and
debt markets and, as a result, would negatively affect our net interest margin and our business. In addition,
downgrades of our credit ratings could increase the possibility of additional terms and conditions being
added to any additional financing or refinancing arrangements in the future. Any such adverse development
could adversely affect our business, financial condition and results of operations.

15. If we are unable to successfully expand, maintain or leverage our partnership arrangements with private
financiers involved in commercial vehicle financing, our business prospects, results of operations and
financial conditions may be adversely affected.

Our partnership and co-financing arrangements with private financiers involved in commercial vehicle
financing across India is an integral part of our growth strategy. We enter into strategic partnership
agreements with private financiers ranging from individual financiers and small local private financiers,
including other NBFCs, to capitalize on their local knowledge, infrastructure and personnel base of our
partners in order to source new customers. Our franchising and co-financing arrangements include various
revenue-sharing arrangements at pre-determined amounts. For further information on our franchising and
co-financing arrangements, see “Our Business - Our Operations - Customer Origination - Partnership and
Co-Financing Arrangements with Private Financiers”.

There can be no assurance that our partners will faithfully comply with the procedural and other conditions
specified by us in connection with our arrangements with them in the context of customer origination,
credit appraisal process, loan administration and monitoring and any loan recovery processes, or that our
partners will not act in any manner that could adversely affect our reputation, brand, customer relationships
or business interests. For example, we have in the past experienced certain instances of fraud by certain of
our partners. There can also be no assurance that we will be able to leverage and benefit from our
partnership arrangements to effectively source a sufficient volume of new customers and business
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 commensurate to the revenue-sharing and other incentives provided to our partners under our arrangements
with them.

In addition, we may not be able to identify suitable private financiers in the future with whom we can
successfully partner through such arrangements, or in joint marketing and customer support activities, and
there can be no assurance that we will be able to ensure any level of success with such partnership
arrangements for any sustained period of time. Furthermore, there can be no assurance that there will not be
any dispute with such partners in the future. If we are unable to successfully expand, maintain or leverage
our partnership arrangements and relationship with our partners, our business prospects, results of
operations and financial conditions may be adversely affected.

16. If we are unable to manage the level of NPAs in our loan assets, our financial position and results of
operations may suffer.

Our Gross NPAs as a percentage of Total Loan Assets was were 2.14% and 2.43% as of March 31, 2009
and December 31, 2009 respectively, while our Net NPAs as a percentage of Net Loan Assets was 0.83%
and 0.67% as of March 31, 2009 and December 31, 2009, respectively. We cannot be sure that we will be
able to improve our collections and recoveries in relation to our NPAs, or otherwise adequately control our
level of NPAs in future. Moreover, as our loan portfolio matures, we may experience greater defaults in
principal and/or interest repayments. Thus, if we are not able to control or reduce our level of NPAs, the
overall quality of our loan portfolio may deteriorate and our results of operations may be adversely
affected. Furthermore, our current provisions may not be adequate when compared to the loan portfolios of
other financial institutions. Moreover, there also can be no assurance that there will be no further
deterioration in our provisioning coverage as a percentage of Gross NPAs or otherwise, or that the
percentage of NPAs that we will be able to recover will be similar to our past experience of recoveries of
NPAs. In the event of any further deterioration in our NPA portfolio, there could be an even greater,
adverse impact on our results of operations.

17. A decline in our capital adequacy ratio could restrict our future business growth.

We are required under applicable laws and regulations to maintain a capital adequacy ratio of at least
12.00% of our risk-weighted assets, consisting of both Tier I and Tier II capital. Our capital adequacy ratio
was 17.07% as of December 31, 2009, with Tier I capital comprising 12.15%. If we continue to grow our
loan portfolio and asset base, we will be required to raise additional Tier I and Tier II capital in order to
continue to meet applicable capital adequacy ratios with respect to our business. There can be no assurance
that we will be able to raise adequate additional capital in the future on terms favorable to us or at all, and
this may adversely affect the growth of our business.

18. As part of our business strategy we assign or securitize a substantial portion of our loan assets to banks
and other institutions. Any deterioration in the performance of any pool of receivables assigned or
securitized to banks and other institutions may adversely impact our financial performance.

As part of our means of raising and/or managing our funds, we assign or securitize a substantial portion of
the receivables from our loan portfolio to banks and other institutions. Such assignment or securitization
transactions are conducted on the basis of our internal estimates of our funding requirements, which may
vary from time to time. In fiscal 2007, 2008 and 2009, and in the nine months ended December 31, 2009,
we securitized/assigned assets of a book value of Rs. 285,979.49 lacs, Rs. 211,822.17 lacs, Rs. 312,498.40
lacs and Rs. 326,229.88 lacs, respectively. Any change in statutory and/regulatory requirements in relation
to assignments or securitizations by financial institutions, including the requirements prescribed by RBI
and the Government of India, could have an adverse impact on our assignment or securitization
transactions.

We are also required to provide a credit enhancement for the securitization/assignment transactions by way
of either fixed deposits or corporate guarantees and the aggregate credit enhancement amount outstanding
as on December 31, 2009 was Rs. 152,736.05 lacs. In the event a relevant bank or institution does not
realize the receivables due under such loan assets, such bank or institution would have recourse to such

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 credit enhancement, which could have a material adverse effect on our results of operations and financial
condition.

19. System failures or inadequacy and security breaches in computer systems may adversely affect our
business.

Our business is increasingly dependent on our ability to process, on a daily basis, a large number of
transactions. Our financial, accounting or other data processing systems may fail to operate adequately or
become disabled as a result of events that are wholly or partially beyond our control, including a disruption
of electrical or communications services.

Our ability to operate and remain competitive will depend in part on our ability to maintain and upgrade
our information technology systems on a timely and cost-effective basis. The information available to and
received by our management through our existing systems may not be timely and sufficient to manage risks
or to plan for and respond to changes in market conditions and other developments in our operations. We
may experience difficulties in upgrading, developing and expanding our systems quickly enough to
accommodate our growing customer base and range of products.

Our operations also rely on the secure processing, storage and transmission of confidential and other
information in our computer systems and networks. Our computer systems, software and networks may be
vulnerable to unauthorized access, computer viruses or other malicious code and other events that could
compromise data integrity and security.

Any failure to effectively maintain or improve or upgrade our management information systems in a timely
manner could materially and adversely affect our competitiveness, financial position and results of
operations. Moreover, if any of these systems do not operate properly or are disabled or if there are other
shortcomings or failures in our internal processes or systems, it could affect our operations or result in
financial loss, disruption of our businesses, regulatory intervention or damage to our reputation. In addition,
our ability to conduct business may be adversely impacted by a disruption in the infrastructure that supports
our businesses and the localities in which we are located.

20. We may not be able to maintain our current levels of profitability due to increased costs or reduced
spreads.

Our business strategy involves a relatively high level of ongoing interaction with our customers. We
believe that this involvement is an important part of developing our relationship with our customers,
identifying new cross-selling opportunities and monitoring our performance. However, this level of
involvement also entails higher levels of costs and also requires a relatively higher gross spread, or margin,
on the finance products we offer in order to maintain profitability. There can be no assurance that we will
be able to maintain our current levels of profitability if the gross spreads on our finance products were to
reduce substantially, which could adversely affect our results of operations.

21. We face asset-liability mismatches which could affect our liquidity and consequently may adversely
affect our operations and profitability.

We face potential liquidity risks due to varying periods over which our assets and liabilities mature. As is
typical for NBFCs, a portion of our funding requirements is met through short-term funding sources such as
bank loans, working capital demand loans, cash credit, short term loans and commercial papers. However,
a large portion of our loan assets mature over a medium term. Consequently, our inability to obtain
additional credit facilities or renew our existing credit facilities, in a timely and cost-effective manner or at
all, may lead to mismatches between our assets and liabilities, which in turn may adversely affect our
operations and financial performance. Further, mismatches between our assets and liabilities are
compounded in case of pre-payments of the financing facilities we grant to our customers.

22. Our loan portfolio may no longer continue to be classified as priority sector advances by the RBI.

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 The RBI currently mandates domestic commercial banks operating in India to maintain an aggregate 40.0%
(32.0% for foreign banks) of their advances or credit equivalent amount of off-balance sheet exposure,
whichever is higher as “priority sector advances”. These include advances to agriculture, small enterprises
(including SRTOs, which constitute the largest proportion of our loan portfolio), exports and similar sectors
where the Government seeks to encourage flow of credit for developmental reasons. Banks in India that
have traditionally been constrained or unable to meet these requirements organically, have relied on
specialized institutions like us that are better positioned to or exclusively focus on originating such assets
through on-lending or purchase of assets or securitized/assigned pools to comply with these targets.

In the event that any part of our loan portfolio is no longer classified as a priority sector advance by the
RBI, our ability to securitize our asset pool will be hampered, which may adversely affect our financial
condition and results of operations.

23. Any change in control of our Promoter may correspondingly adversely affect our operations and
profitability.

As of December 31, 2009, SCL holds 50.17% of the paid up share capital of our Promoter, Shriram
Holdings (Madras) Private Limited, and the remaining shares in Shriram Holdings (Madras) Private
Limited were held by certain strategic investors. Shriram Holdings (Madras) Private Limited holds 41.40%
of the paid up share capital of our Company. If SCL ceases to exercise control over our Promoter as a
result of any transfer of shares or otherwise, our ability to derive any benefit from the brand name
“Shriram” and our goodwill as a part of the Shriram group of companies may be adversely affected, which
in turn could adversely affect our business and results of operations. Any such change of control could also
significantly influence our business policies and operations.

24. The trade mark/service mark and logo in connection with the “Shriram” brand which we use is licensed
to us and consequently, any termination or non-renewal of such license may adversely affect our
goodwill, operations and profitability.

Pursuant to a license and user agreement dated November 28, 2003 between the Company and SCL
(formerly Shriram Financial Services Holdings Private Limited), we are entitled to use the brand name
“Shriram” and the associated mark for which we pay periodic royalty of 0.25% of the Company's total
gross income to SCL on a quarterly basis. In addition to the royalty, the Company agreed to pay a fee
equivalent to 0.1% of the total gross funds mobilized by SCL in relation to the Company's right to access
SCL's agent network and Chit subscribers. The royalties and fees shall accrue in favor of the licensor until
termination of the agreement.
This license agreement is valid until March 31, 2011. In the event such license and user agreement is
terminated or is not renewed or extended in the future, we will not be entitled to use the brand name
“Shriram” and the associated mark in connection with our business operations. Consequently, we will not
be able to derive the goodwill that we have been enjoying under the “Shriram” brand. We operate in a
competitive environment, and we believe that our brand recognition is a significant competitive advantage
to us. If the license and user agreement is not renewed or terminated, we may need to change our name,
trade mark/service mark or the logo. Any such change could require us to incur additional costs and may
adversely impact our goodwill, business prospects and results of operations.
Our Company has also made applications for the registration of brand names ‘AUTOMALL’ ‘NEW
LOOK’ AND ‘ONE STOP’ under various classes with the Registrar of Trademarks.

25. We have certain contingent liabilities which may adversely affect our financial condition.

As of December 31, 2009, we had certain contingent liabilities not provided for, including the following:
disputed income tax/ interest tax demand contested in appeals not provided for of Rs. 164.76 lacs, income
tax penalty of Rs. 349.86 lacs, demands in respect of service tax of Rs. 312.00 lacs, guarantees issued and
outstanding by the Company of Rs. 700.00 lacs. For further information on such contingent liabilities, see
Annexure VI to our Reformatted Summary Financial Statements. In the event that any of these contingent
liabilities materialize, our financial condition may be adversely affected.

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26. We are involved in various legal and other proceedings that if determined against us could have a
material adverse effect on our financial condition and results of operations.

We are currently involved in a number of legal proceedings arising in the ordinary course of our business.
These proceedings are pending at different levels of adjudication before various courts and tribunals,
primarily relating to civil suits and tax disputes. For further information relating to certain significant legal
proceedings that we are involved in, see “Pending Proceedings and Statutory Defaults”.

An adverse decision in these proceedings could materially and adversely affect our business, financial
condition and results of operations.

27. We may have to comply with strict regulations and guidelines issued by regulatory authorities in India.

We are regulated principally by and have reporting obligations to the RBI. We are also subject to the
corporate, taxation and other laws in effect in India. The regulatory and legal framework governing us may
continue to change as India’s economy and commercial and financial markets evolve. In recent years,
existing rules and regulations have been modified, new rules and regulations have been enacted and
reforms have been implemented which are intended to provide tighter control and more transparency in
India’s asset finance sector. Further, RBI may increase the minimum capital adequacy requirement for
deposit taking NBFCs such as us.

Compliance with many of the regulations applicable to our operations may involve significant costs and
otherwise may impose restrictions on our operations. If the interpretation of the regulators and authorities
varies from our interpretation, we may be subject to penalties and the business of our Company could be
adversely affected. There can be no assurance that changes in these regulations and the enforcement of
existing and future rules by governmental and regulatory authorities will not adversely affect our business
and future financial performance.

28. Our ability to assess, monitor and manage risks inherent in our business differs from the standards of
some of our counterparts in India and in some developed countries.

We are exposed to a variety of risks, including liquidity risk, interest rate risk, credit risk, operational risk
and legal risk. The effectiveness of our risk management is limited by the quality and timeliness of
available data.

Our hedging strategies and other risk management techniques may not be fully effective in mitigating our
risks in all market environments or against all types of risk, including risks that are unidentified or
unanticipated. Some methods of managing risks are based upon observed historical market behavior. As a
result, these methods may not predict future risk exposures, which could be greater than the historical
measures indicated. Other risk management methods depend upon an evaluation of information regarding
markets, customers or other matters. This information may not in all cases be accurate, complete, current,
or properly evaluated. Management of operational, legal or regulatory risk requires, among other things,
policies and procedures to properly record and verify a number of transactions and events. Although we
have established these policies and procedures, they may not be fully effective. Our future success will
depend, in part, on our ability to respond to new technological advances and evolving NBFC and vehicle
finance sector standards and practices on a cost-effective and timely basis. The development and
implementation of such technology entails significant technical and business risks. There can be no
assurance that we will successfully implement new technologies or adapt our transaction-processing
systems to customer requirements or evolving market standards.

29. Our Promoter has significant control in the Company, which will enable them to influence the outcome
of matters submitted to shareholders for approval, and their interests may differ from those of other
holders of Equity Shares.

As of March 31, 2010, Shriram Holdings (Madras) Private Limited, our Promoter, beneficially owned
approximately 41.40% of our share capital. See “Capital Structure”. Our Promoter has the ability to control
our business including matters relating to any sale of all or substantially all of our assets, the timing and
- xxii -
 distribution of dividends and the election or termination of appointment of our officers and directors. This
control could delay, defer or prevent a change in control of the Company, impede a merger, consolidation,
takeover or other business combination involving the Company, or discourage a potential acquirer from
making a tender offer or otherwise attempting to obtain control of the Company even if it is in the
Company’s best interest. In addition, for so long as our Promoter continues to exercise significant control
over the Company, it may influence the material policies of the Company in a manner that could conflict
with the interests of our other shareholders. The Promoter group may have interests that are adverse to the
interests of our other shareholders and may take positions with which we or our other shareholders do not
agree.

30. Certain shareholders of our Promoter Shriram Holdings (Madras) Private Limited have rights to
nominate directors on our Board.

Pursuant to the Share Subscription Agreement dated February 2, 2006, as amended on September 12, 2008
(“Share Subscription Agreement”), Newbridge India Investments II Limited (“New Bridge”), which
currently holds 49.0% of the paid-up share capital of our Promoter Shriram Holdings (Madras) Private
Limited, is entitled to appoint two nominee directors on our Board. Furthermore, in the event that the size
of the Board is increased beyond 12 directors, New Bridge and the Founders (defined as R. Thyagarajan, T.
Jayaraman, A.V.S. Raja and Shriram Financial Services Holdings Private Limited, collectively) will each
be entitled to appoint three directors on the Board. In the event that any shareholder having a right to
nominate a director ceases to have such right, then the resulting vacancy shall be filled by the appointment
of independent directors. In addition, New Bridge, on the one hand, and the Founders, on the other hand,
are entitled to nominate an equal number of nominees on any committee of the Board.

Under the terms of such Share Subscription Agreement, certain reserved matters require the affirmative
vote and/or prior consent of the directors nominated by New Bridge and the Founders on our Board or any
committee thereof. These matters include, among others, any further issuance of any Equity Shares by the
Company; acquisition of the assets of any other business; creation of a joint venture or partnership, or
merger, demerger and consolidation or any other business combination; disinvestment in any subsidiary;
appointment, removal and revision of the compensation of key personnel; capital expenditure in excess of
Rs.30.00 lacs; any amendment to the memorandum or articles of association of the Company; any
amendment in the annual business plan of the Company; commencement of a new line of business; any
changes to material accounting or tax policies; recommendation of or declaration of dividend or
distribution of any kind; removal of the statutory or internal auditor; any bankruptcy, dissolution,
insolvency, recapitalization, reorganization, assignment to creditors, winding up and/or liquidation; an
increase or reorganization in the issued, subscribed or paid up equity or preference share capital; any
connected person transaction; any amendment, modification or cancellation of the trademark license
agreement (license and user agreement) between Shriram Financial Services Holdings Private Limited, as
licensor, and the Company for the use of the "Shriram" brand and associated logos. In the event that the
beneficial ownership of New Bridge in the Company, indirectly through our Promoter or directly, becomes
greater than that of the Founders, then the number of reserved matters requiring the affirmative vote of the
directors nominated by the Founders would be reduced; moreover, in such event, New Bridge shall also be
entitled to appoint and remove the managing director (whether designated as managing director, CEO,
COO or otherwise) and other key employees of the Company and of our Promoter.

As an exit mechanism, New Bridge may, at any time after expiry of two years from September 12, 2008,
require our Promoter to distribute the shares held by our Promoter in the Company amongst the Founders
and New Bridge in proportion to their respective holdings in our Promoter; in the alternative, New Bridge
may require the merger of our Promoter with the Company in order to effect such distribution. Moreover,
within two years from September 12, 2008, New Bridge is entitled to acquire controlling interest in our
Promoter from the Founders, subject to the payment of a call option price plus a control premium. The
Company, the Founders and our Promoter Shriram Holdings (Madras) Private Limited have agreed to
jointly and severally indemnify New Bridge in the event of any breach of the terms of such Share
Subscription Agreement. Drag along rights are also provided for in the Share Subscription Agreement.
After March 11, 2011 New Bridge is entitled, at any time to require the founders to sell all or part of the
latter's shares or warrants in the Company or in our Promoter. In the event that New Bridge does not accept
the purchase offer of a proposed purchaser as communicated by the Founders, New Bridge may in turn
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 present the Founders with the terms of another purchase offer, which shall not provide for a lower purchase
price.

New Bridge and the Founders, pursuant to their rights under the Share Subscription Agreement and as
shareholders in our Promoter, may influence policies of the Company in a manner that could conflict with
the interests of our other shareholders. New Bridge and the Founders may have interests that are adverse to
the interests of our other shareholders and may take positions with which the Company or our other
shareholders do not agree.

31. We have entered into certain related party transactions.

We have entered into transactions with related parties, within the meaning of AS 18 as notified by the
Companies (Accounting Standards) Rules, 2006. These transactions include royalty paid to SCL pursuant
to the License and User Agreement dated November 28, 2003 between the Company and SCL in
connection with the use of the brand name "Shriram" and the associated mark, for which we pay periodic
royalty of 0.25% of the Company's total gross income to SCL on a quarterly basis. In addition to the
royalty, our Company agreed to pay an annualized fee to SCL equivalent to 0.1% of the total gross funds
mobilized by SCL for access to the database of agents and Chit subscribers. For further information on our
related party transactions please see the section titiled “Financial Information”. Such transactions may
give rise to current or potential conflicts of interest with respect to dealings between us and such related
parties. Additionally, there can be no assurance that any dispute that may arise between us and related
parties will be resolved in our favor.

32. Any failure by us to identify, manage, complete and integrate acquisitions, divestitures and other
significant transactions successfully could adversely affect our results of operations, business and
prospects.

As part of our business strategy, we may acquire complementary companies or businesses, divest non-core
businesses or assets, enter into strategic alliances and joint ventures and make investments to further our
business. In order to pursue this strategy successfully, we must identify suitable candidates for and
successfully complete such transactions, some of which may be large and complex, and manage the
integration of acquired companies or employees. We may not fully realize all of the anticipated benefits of
any such transaction within the anticipated timeframe or at all. Any increased or unexpected costs,
unanticipated delays or failure to achieve contractual obligations could make such transactions less
profitable or unprofitable. Managing business combination and investment transactions requires varying
levels of management resources, which may divert our attention from other business operations, may result
in significant costs and expenses and charges to earnings. The challenges involved in integration include:

• combining product offerings and entering into new markets in which we are not experienced;

• consolidating and maintaining relationships with customers;

• consolidating and rationalizing transaction processes and corporate and IT infrastructure;

• integrating employees and managing employee issues;

• coordinating and combining administrative and other operations and relationships with third
parties in accordance with applicable laws and other obligations while maintaining adequate
standards, controls and procedures;

• achieving savings from infrastructure integration; and

• managing other business, infrastructure and operational integration issues.

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33. The BSE has suspended the trading of our Equity Shares in the past.

Pursuant to an order dated December 18, 1998, issued by the BSE, the trading of our Equity Shares on the
BSE was suspended from December 21, 1998 to January 3, 1999 on account of alleged non-compliance
with clauses 15 and 16 of the listing agreement entered into with the BSE in connection with the listing and
trading of our Equity Shares.

Our failure to comply with the provisions of the listing agreements executed between our Company and the
stock exchanges where our securities are listed, in a timely manner or at all, may expose us to regulatory
proceedings and/or penal action.

34. Our success depends in large part upon our management team and key personnel and our ability to
attract, train and retain such persons.

Our ability to sustain our rate of growth depends significantly upon our ability to manage key issues such
as selecting and retaining key managerial personnel, developing managerial experience to address emerging
challenges and ensuring a high standard of client service. In order to be successful, we must attract, train,
motivate and retain highly skilled employees, especially branch managers and product executives. If we
cannot hire additional qualified personnel or retain them, our ability to expand our business will be
impaired and our revenue could decline. We will need to recruit new employees, who will have to be
trained and integrated into our operations. We will also have to train existing employees to adhere properly
to internal controls and risk management procedures. Failure to train and motivate our employees properly
may result in an increase in employee attrition rates, require additional hiring, erode the quality of customer
service, divert management resources, increase our exposure to high-risk credit and impose significant
costs on us. Hiring and retaining qualified and skilled managers are critical to our future, as our business
model depends on our credit-appraisal and asset valuation mechanism, which are personnel-driven
operations. Moreover, competition for experienced employees in the commercial vehicle finance sector
can be intense. While we have an incentive structure and an Employee Stock Option Scheme designed to
encourage employee retention, our inability to attract and retain talented professionals, or the resignation or
loss of key management personnel, may have an adverse impact on our business and future financial
performance.

35. We are exposed to fluctuations in the market values of our investment and other asset portfolio.

Recent turmoil in the financial markets has adversely affected economic activity globally, including in
India. Continued deterioration of the credit and capital markets could result in volatility of our investment
earnings and impairments to our investment and asset portfolio, which could negatively impact our
financial condition and reported income.

36. Our results of operations could be adversely affected by any disputes with our employees.

As of December 31, 2009, we employed over 12,823 full-time employees. Currently, none of our
employees are members of any labor union. While we believe that we maintain good relationships with our
employees, there can be no assurance that we will not experience future disruptions to our operations due to
disputes or other problems with our work force, which may adversely affect our business and results of
operations.

37. Our inability to obtain, renew or maintain our statutory and regulatory permits and approvals required
to operate our business may have a material adverse effect on our business.

We require certain statutory and/or regulatory permits and approvals for our business. In the future, we will
be required to renew such permits and approvals and obtain new permits and approvals for any proposed
operations. There can be no assurance that the relevant authorities will issue any of such permits or
approvals in a timely manner,- or at all, and/or on favorable terms and conditions. Failure by us to comply
with the terms and conditions to which such permits or approvals are subject, and/or to renew, maintain or
obtain the required permits or approvals may result in the interruption of our operations and may have a
material adverse effect on our business, financial condition and results of operations.
- xxv -
38. We are subject to supervision and regulation by the RBI as a deposit-taking NBFC, and changes in
RBI’s regulations governing us could adversely affect our business.

We are subject to the RBI’s guidelines on financial regulation of NBFCs, including capital adequacy,
exposure and other prudential norms. The RBI also regulates the credit flow by banks to NBFCs and
provides guidelines to commercial banks with respect to their investment and credit exposure norms for
lending to NBFCs. The RBI’s regulations of NBFCs could change in the future which may require us to
restructure our activities, incur additional cost or could otherwise adversely affect our business and our
financial performance.

The RBI, from time to time, amends the regulatory framework governing NBFCs to address, inter-alia,
concerns arising from certain divergent regulatory requirements for banks and NBFCs. Pursuant to two
notifications dated December 6, 2006, (Notifications No. DNBS. 189 / CGM (PK)-2006 and DNBS.190 /
CGM (PK)-2006), the RBI amended the NBFC Acceptance of Public Deposits (Reserve Bank) Directions,
1998, reclassifying deposit taking NBFCs, such as us. We are also subject to the requirements of the Non
Banking Financial (Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank)
Directions, 2007, issued by the RBI on February 22, 2007, as amended.

The laws and regulations governing the banking and financial services industry in India have become
increasingly complex and cover a wide variety of issues, such as interest rates, liquidity, securitization,
investments, ethical issues, money laundering and privacy. In some cases, there are overlapping
regulations and enforcement authorities. Moreover, these laws and regulations can be amended,
supplemented or changed at any time such that we may be required to restructure our activities and incur
additional expenses to comply with such laws and regulations, which could materially and adversely affect
our business and our financial performance.

Compliance with many of the regulations applicable to our operations in India and/or outside India,
including any restrictions on investments, lending and other activities currently being carried out by our
Company, involves a number of risks, particularly in areas where applicable regulations may be subject to
varying interpretations. If the interpretation of the regulators and authorities varies from our interpretation,
we may be subject to penalties and our business could be adversely affected. We are also subject to changes
in Indian laws, regulations and accounting principles and practices. There can be no assurance that the laws
governing the Indian financial services sector will not change in the future or that such changes or the
interpretation or enforcement of existing and future laws and rules by governmental and regulatory
authorities will not adversely affect our business and future financial performance.

39. Our insurance coverage may not adequately protect us against losses.

We maintain such insurance coverage that we believe is adequate for our operations. Our insurance
policies, however, may not provide adequate coverage in certain circumstances and are subject to certain
deductibles, exclusions and limits on coverage. We maintain general liability insurance coverage,
including coverage for errors or omissions. We cannot, however, assure you that the terms of our insurance
policies will be adequate to cover any damage or loss suffered by us or that such coverage will continue to
be available on reasonable terms or will be available in sufficient amounts to cover one or more large
claims, or that the insurer will not disclaim coverage as to any future claim.

A successful assertion of one or more large claims against us that exceeds our available insurance coverage
or changes in our insurance policies, including premium increases or the imposition of a larger deductible
or co-insurance requirement, could adversely affect our business, financial condition and results of
operations.

Risks Relating to the Utilization of Issue Proceeds

40. The fund requirement and deployment mentioned in the Objects of the Issue have not been appraised by
any bank or financial institution.

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 We intend to use the proceeds of the Issue, after meeting the expenditures of and related to the Issue, for
our various financing activities including lending and investments, subject to the restrictions contained in
the Foreign Exchange Management (Borrowing and Lending in Rupee) Regulations, 2000, and other
applicable statutory and/or regulatory requirements, to repay our existing loans and our business operations
including for our capital expenditure and working capital requirements. The Unsecured NCDs will be in the
nature of subordinated debt and will be eligible for Tier II capital and accordingly will be utilised in
acordnce with statutory and regulatory requirements including requirements of RBI. For further details,
please refer to the section titled “Objects of the Issue” beginning on page 91 of this Prospectus. The fund
requirement and deployment is based on internal management estimates and has not been appraised by any
bank or financial institution. Accordingly, the management will have significant flexibility in applying the
proceeds received by us from the Issue. Further, as per the provisions of the Debt Regulations, we are not
required to appoint a monitoring agency and therefore no monitoring agency has been appointed for this
Issue.

Risks Relating to the NCDs

41. There are certain risks in connection with the Unsecured NCDs.

The Unsecured NCDs will be in the nature of subordinated debt and hence the claims of the holders thereof
will be subordinated to the claims of other secured and other unsecured creditors of our Company. Further,
since no charge upon the assets of our Company would be created in connection with the the Unsecured
NCDs, in the event of default in connection therewith, the holders of Unsecured NCDs may not be able to
recover their principal amount and/or the interest accrued thereoin in a timely manner, for the entire value
of the Unsecured NCDs held by them or at all. Accordingly, in such a case the holders of Unsecured NCDs
may lose all or a part of their investment therein. Further, the payment of interest and the repayment of the
prinicipal amount in connection with the Unsecured NCDs would be subject to the requirements of RBI,
which may also require our Company to obtain a prior approval from the RBI in certain circumstances.

42. Changes in interest rates may affect the price of our NCDs.

All securities where a fixed rate of interest is offered, such as our NCDs, are subject to price risk. The price
of such securities will vary inversely with changes in prevailing interest rates, i.e. when interest rates rise,
prices of fixed income securities fall and when interest rates drop, the prices increase. The extent of fall or
rise in the prices is a function of the existing coupon, days to maturity and the increase or decrease in the
level of prevailing interest rates. Increased rates of interest, which frequently accompany inflation and/or a
growing economy, are likely to have a negative effect on the price of our NCDs.

43. You may not be able to recover, on a timely basis or at all, the full value of the outstanding amounts
and/or the interest accrued thereon in connection with the Secured NCDs.

Our ability to pay interest accrued on the Secured NCDs and/or the principal amount outstanding from time
to time in connection therewith would be subject to various factors inter-alia including our financial
condition, profitability and the general economic conditions in India and in the global financial markets.
We cannot assure you that we would be able to repay the principal amount outstanding from time to time
on the Secured NCDs and/or the interest accrued thereon in a timely manner or at all. Although our
Company will create appropriate security in favour of the Debenture Trustee for the Secured NCD holders
on the assets adequate to ensure 100% asset cover for the Secured NCDs, which shall be free from any
encumbrances, the realizable value of the assets charged as security, when liquidated, may be lower than the
outstanding principal and/or interest accrued thereon in connection with the Secured NCDs. A failure or
delay to recover the expected value from a sale or disposition of the assets charged as security in
connection with the Secured NCDs could expose you to a potential loss.

44. If we do not generate adequate profits, we may not be able to maintain an adequate Debenture
Redemption Reserve, (“DRR”), for the NCDs issued pursuant to this Prospectus.

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 Section 117C of the Act states that any company that intends to issue debentures must create a DRR to
which adequate amounts shall be credited out of the profits of the company until the debentures are
redeemed. The Ministry of Corporate Affairs has, through its circular dated April 18, 2002, (“Circular”),
specified that the quantum of DRR to be created before the redemption liability actually arises in normal
circumstances should be ‘adequate’ to pay the value of the debentures plus accrued interest, (if not already
paid), till the debentures are redeemed and cancelled. The Circular however further specifies that, for
NBFCs like our Company, (NBFCs which are registered with the RBI under Section 45-IA of the RBI
Act), the adequacy of the DRR will be 50% of the value of debentures issued through the public issue.
Accordingly our Company is required to create a DRR of 50% of the value of debentures issued through
the public issue. As further clarified by the Circular, the amount to be credited as DRR will be carved out
of the profits of the company only and there is no obligation on the part of the company to create DRR if
there is no profit for the particular year. Accordingly, if we are unable to generate adequate profits, the
DRR created by us may not be adequate to meet the 50% of the value of the NCDs. This may have a
bearing on the timely redemption of the NCDs by our Company.

45. Any downgrading in credit rating of our NCDs may affect the value of NCDs and thus our ability to
raise further debts.

The Secured NCDs proposed to be issued under this Issue have been rated ‘CARE AA+’ by CARE for an
amount of upto Rs. 50,000 lacs and ‘AA/Stable’ by CRISIL for an amount of upto Rs. 50,000 Lacs vide
their letters dated April 19, 2010 and April 27, 2010, respectively and the Unsecured NCDs proposed to be
issued under this Issue have been rated ‘CARE AA’ by CARE for an amount of upto Rs. 50,000 Lacs and
‘AA/Stable’ by CRISIL for an amount of upto Rs. 50,000 Lacs vide their letters dated April 19, 2010 and
April 27, 2010, respectively. The Issuer cannot guarantee that this rating will not be downgraded. The
ratings provided by CARE or CRISIL may be suspended, withdrawn or revised at any time by these
assigning rating agencies. Any revision or downgrading in the above credit rating(s) may lower the value of
the NCDs and may also affect the Issuers ability to raise further debt.

46. There is no active market for the NCDs on the WDM segment of the stock exchanges. As a result the
liquidity and market prices of the NCDs may fail to develop and may accordingly be adversely affected.

There can be no assurance that an active market for the NCDs will develop. If an active market for the
NCDs fails to develop or be sustained, the liquidity and market prices of the NCDs may be adversely
affected. The market price of the NCDs would depend on various factors inter alia including (i) the interest
rate on similar securities available in the market and the general interest rate scenario in the country, (ii) the
market price of our Equity Shares, (iii) the market for listed debt securities, (iv) general economic
conditions, and, (v) our financial performance, growth prospects and results of operations. The
aforementioned factors may adversely affect the liquidity and market price of the NCDs, which may trade
at a discount to the price at which you purchase the NCDs and/or be relatively illiquid.

47. There may be a delay in making refunds to applicants.

We cannot assure you that the monies refundable to you, on account of (a) withdrawal of your applications,
(b) our failure to receive minimum subscription in connection with the Base Issue, (c) withdrawal of the
Issue, or (d) failure to obtain the final approval from the NSE for listing of the NCDs, will be refunded to
you in a timely manner. We however, shall refund such monies, with the interest due and payable thereon
as prescribed under applicable statutory and/or regulatory provisions.

B. EXTERNAL RISK FACTORS

1. Our business is dependent on the automobile and transportation industry in India.

Our business to a large extent depends on the continued growth in the automobile and transportation
industry in India, which is influenced by a number of extraneous factors which are beyond our control,
inter-alia including (a) the macroeconomic environment in India, (b) the demand for transportation
services, (c) natural disasters and calamities, and (d) changes in regulations and policies in connection with
- xxviii -
 motor vehicles. Such factors may result in a decline in the sales or value of new and pre-owned CVs.
Correspondingly, the demand for availing finance for new and pre-owned commercial vehicles may
decline, which in turn may adversely affect our financial condition and the results of our operations.
Further, the ability of CV owners and/or operators to perform their obligations under existing financing
agreements may be adversely affected if their businesses suffer as a result of the aforesaid factors.

2. Increase in competition from our peer group in the CV finance sector may result in reduction of our
market share, which in turn may adversely affect our profitability.

Our Company provides loans to pre-owned and new CV owners and/or operators in suburban and rural
areas in India. Although, we are currently the largest asset financing NBFC providing CV finance*, we
have been increasingly facing competition from domestic and foreign banks and NBFCs operating in the
CV finance segment of the industry. Some of our competitors are very aggressive in underwriting credit
risk and pricing their products and may have access to funds at a lower cost, wider networks and greater
resources than our Company. Our financial condition and results of operations are dependent on our ability
to obtain and maintain low cost funds and to provide prompt and quality services to our customers. If our
Company is unable to access funds at a cost comparable to or lower than our competitors, we may not be
able to offer loans at competitive interest rates to our customers.

* Based on financial and non financial parameters for the financial year 2009 for selected NBFCs as
contained in the D&B Research Report, [Source: Dun & Bradstreet Research Report]

While our Company believes that it has historically been able to offer competitive interest rates on the
loans extended to our customers, there can be no assurance that our Company will be able to continue to do
so in the future. An increase in competition from our peer group may result in a decline in our market
share, which may in turn result in reduced incomes from our operations and may adversely affect our
profitability.

3. Our growth depends on the sustained growth of the Indian economy. An economic slowdown in India
and abroad could have a direct impact on our operations and profitability.

Macroeconomic factors that affect the Indian economy and the global economic scenario have an impact on
our business. The quantum of our disbursements is driven by the growth in demand for CVs. Any slow
down in the Indian economy may have a direct impact on our disbursements and a slowdown in the
economy as a whole can increase the level of defaults thereby adversely impacting our Company’s,
profitability, the quality of its portfolio and growth plans.

4. Political instability or changes in the government could delay further liberalization of the Indian
economy and adversely affect economic conditions in India generally, which could impact our business.

Since 1991, the Government has pursued a policy of economic liberalization, including significantly
relaxing restrictions on the private sector. There can be no assurance that these liberalization policies will
continue in the future as well. The rate of economic liberalization could change, and specific laws and
policies affecting financial services companies, foreign investment, currency exchange rates and other
matters affecting investments in Indian companies could change as well. A significant slowdown in India’s
economic liberalization and deregulation policies could disrupt business and economic conditions in India,
thus affecting our business. Any political instability in the country, including any change in the
Government, could materially impact our business adversely.

5. Civil unrest, terrorist attacks and war would affect our business.

Terrorist attacks and other acts of violence, war or conflicts, particularly those involving India, as well as
the United States of America, the United Kingdom, Singapore and the European Union, may adversely

- xxix -
 affect Indian and global financial markets. Such acts may negatively impact business sentiment, which
could adversely affect our business and profitability. India has from time to time experienced, and
continues to experience, social and civil unrest, terrorist attacks and hostilities with neighbouring countries.
Also, some of India’s neighbouring countries have experienced, or are currently experiencing internal
unrest. This, in turn, could have a material adverse effect on the Indian economy and in turn may adversely
affect our operations and profitability and the market for the NCDs.

6. Our business may be adversely impacted by natural calamities or unfavourable climatic changes.

India, Bangladesh, Pakistan, Indonesia and other Asian countries have experienced natural calamities such
as earthquakes, floods, droughts and a tsunami in recent years. Some of these countries have also
experienced pandemics, including the outbreak of avian flu. These economies could be affected by the
extent and severity of such natural disasters and pandemics which could ,in turn affect the financial services
sector of which our Company is a part. Prolonged spells of abnormal rainfall, draught and other natural
calamities could have an adverse impact on the economy, which could in turn adversely affect our business
and the price of our NCDs.

7. Any downgrading of India's sovereign rating by an international rating agency(ies) may affect our
business and our liquidity to a great extent.

Any adverse revision to India's credit rating for domestic and international debt by international rating
agencies may adversely impact our ability to raise additional finances at favourable interest rates and other
commercial terms. This could have an adverse effect on our growth, financial performance and our
operations.

PROMINENT NOTES

1. This is a public issue of NCDs by our Company aggregating upto Rs. 25,000 lacs with an option to retain
over-subscription upto Rs. 25,000 lacs for issuance of additional NCDs aggregating to a total of Rs. 50,000
lacs, including a reservation for Unsecured NCDs aggregating upto Rs. 20,000 lacs. The Unsecured NCDs
will be in the nature of subordinated debt and will be eligible for Tier II capital.

2. For details on the interest of our Company’s Directors, please refer to the sections titled “Our
Management” and “Capital Structure” on pages 127 and 68 of this Prospectus, respectively.

3. Our Company has entered into certain related party transactions, within the meaning of AS 18 as notified
by the Companies (Accounting Standards) Rules, 2006, as disclosed in the section titled “Financial
Information” beginning on page 142 of this Prospectus.

4. Any clarification or information relating to the Issue shall be made available by the Lead Managers, the
Co-Lead Manager and our Company to the investors at large and no selective or additional information
would be available for a section of investors in any manner whatsoever.

5. Investors may contact the Registrar to the Issue, Compliance Officer, the Lead Managers the Co-Lead
Manager for any complaints pertaining to the Issue. In case of any specific queries on allotment/refund,
Investor may contact Registrar to the Issue.

6. In the event of oversubscription to the Issue, allocation of NCDs will be as per the "Basis of Allotment" set
out on page 197 of this Prospectus.

7. Our Equity Shares are listed on the NSE, BSE and MSE.

8. The non convertible debentures issued pursuant to the public issue vide the prospectus dated July 16, 2009
are listed in NSE and BSE. Some of our privately placed non convertible debentures and other debt
instruments are listed in BSE and some in NSE.
- xxx -
9. As of December 31, 2009, we had certain contingent liabilities not provided for, including the following:
disputed income tax/ interest tax demand contested in appeals not provided for of Rs. 164.76 lacs, income
tax penalty of Rs. 349.86 lacs, demands in respect of service tax of Rs. 312.00 lacs, guarantees issued and
outstanding by the Company of Rs. 700.00 lacs. For further information on such contingent liabilities, see
Annexture VI to our Reformatted Summary Financial Statements.

10. For further information relating to certain significant legal proceedings that we are involved in, see
“Pending Proceedings and Statutory Defaults”.

- xxxi -
 SECTION III : INTRODUCTION

GENERAL INFORMATION

Shriram Transport Finance Company Limited

Date of Incorporation: June 30, 1979. Our Company was incorporated as a public limited company under the provisions of
the Act.

Registered Office:

123, Angappa Naicken Street, Chennai – 600 001, Tamil Nadu, India

Registration:

Corporate Identification Number: L65191TN1979PLC007874 issued by the Registrar of Companies, Tamil Nadu.

Our Company holds a certificate of registration dated September 4, 2000 bearing registration no. A-07-00459 issued by the
RBI to carry on the activities of a NBFC under section 45 IA of the RBI Act, 1934, which has been renewed on April 17,
2007, (bearing registration no. 07-00459).

Compliance Officer (and Company Secretary):

The details of the person appointed to act as Compliance Officer for the purposes of this Issue is set out below:

Investors may contact the Registrar to the Issue or the Compliance Officer in case of any pre-issue or post Issue related
issues such as non-receipt of Allotment Advice, demat credit, refund orders or interest on application money.

Mr K. Prakash
Vice President (Corporate Affairs) & Company Secretary
Shriram Transport Finance Company Limited
Wockhardt Towers, Level-3, West Wing, C –2, G Block,
Bandra-Kurla Complex, Bandra (East), Mumbai –400 051.
Tel. No. +91 22-40959595
Fax No.: +91 22-40959596/97
Email: stfcncd2@stfc.in

Lead Managers:

JM Financial Consultants Private Limited

141 Maker Chambers III
Nariman Point
Mumbai – 400 021
Tel : +91 22 6630 3030
Fax: +91 22 2204 2137
Email: STFCBondIssue@jmfinancial.in
Investor Grievance Email: grievance.ibd@jmfinancial.in
Website: www.jmfinancial.in
Contact Person : Ms. Lakshmi Lakshmanan
Compliance Officer: Mr. Chintal Sakaria
SEBI Registration No.: INM000010361
- 32 -
ICICI Securities Limited:

ICICI Centre,
H.T. Parekh Marg,
Churchgate, Mumbai 400 020,
Maharashtra, India
Tel: +91 22 2288 2460
Fax: +91 22 2282 6580
Email: stfc.debtissue@icicisecurities.com
Compliance Officer: Mr. Subir Saha
Investor Grievance Email: customercare@icicisecurities.com
Website: www.icicisecurities.com
Contact Person: Mr. Mangesh Ghogle / Mr. Johnny Barnett
SEBI Registration no: INM000011179

Co-Lead Manager

RR Investors Capital Services Private Limited

133A, Mittal Tower, Nariman Point,
Mumbai - 400021
Tel : + 91 22 22886627
Fax: + 91 22 22851925
Email: stfcncd2@rrfcl.com
Investor Grievance Email:
rrinvestors@rrfcl.com
Website: www.rrfcl.com/ rrfinance.com
Contact Person: Mr. Brahmdutta Singh
Compliance Officer: Mr. Brahmdutta Singh
SEBI Registration No: INM000007508

Debenture Trustee:

IDBI Trusteeship Services Limited

Asian Building, Ground Floor,
17, R Kamani Marg,
Ballard Estate, Mumbai – 400 001
Tel: +91 22 4080 7000
Fax: + 91 22 6631 1776
Website: www.idbitrustee.co.in
Contact Person: Ms. Brindha V.
Email: brindha@idbitrustee.co.in
SEBI Registration No.IND000000460

IDBI Trusteeship Services Limited has by its letter dated April 12, 2010 given its consent for its appointment as Debenture
Trustee to the Issue and for its name to be included in this Prospectus and in all the subsequent periodical communications
sent to the holders of the Debentures issued pursuant to this Issue.
Registrar

Integrated Enterprises (India) Limited

2nd Floor,
Kences Towers,
No1, Ramakrishna Street,
North Usman Road, T. Nagar,
Chennai - 600 017
Tel:+91 44 2814 0801/03
- 33 -
Fax: +91 44 2814 2479
Email for this issue : stfcipo@iepindia.com
Investor Grievance Email: sureshbabu@iepindia.com
Website: www.iepindia.com
Contact Person: Ms. Anusha N.
Compliance Officer: Mr. Suresh Babu K.
SEBI Registration No.: INR000000544

Statutory Auditors:
Our joint auditors being:

M/s. S. R. Batliboi & Co. M/s. G. D. Apte & Co.

Chartered Accountants Chartered Accountants
6th floor, Express Towers Dream Presidency, 1202/17E,
Nariman Point Shivajinagar, Off Apte Road,
Mumbai – 400 021 Pune – 411 004
Email: SRBC@in.ey.com Tel: +91 20 2553 2114
Tel: +91 22 6657 9200 Fax: +91 20 2553 4769
Fax: +91 22 2287 6401 Firm registration number: 100515W
Firm registration number: 301003E

Credit Rating Agencies:

Credit Analysis & Research Limited

4th Floor, Godrej Coliseum,
Somaiya Hospital Road,
Off Eastern Express Highway,
Sion (East), Mumbai – 400 022
Tel: +91 22 6754 3456
Fax: +91 22 6754 3457

CRISIL Limited
CRISIL House, Central Avenue,
Hiranandani Business Park,
Powai,
Mumbai – 400 076
Tel: +91 22 3342 3000
Fax: +91 22 3342 3050

Legal Advisor to the Issue:

J Sagar Associates
Vakils House,
18, Sprott Road
Ballard Estate
Mumbai- 400 001
Tel: +91 22 4341 8500
Fax: +91 22 6656 1515

Advisors to the Issuer

VNS Legal
Advocates

- 34 -
5th Floor, Mookambika Complex
4, Lady Desika Road
Mylapore
Chennai - 600 004, India
Tel: + 91 94440 76813, +91 44 2499 7133
Fax : + 91 44 2499 0549

Bankers to the Issue:

The Hongkong and Shanghai Banking ING Vysya Bank Limited

Corporation Limited 12, Mittal Tower, ‘C’ Wing, 210,
Shiv Building, Plot No.139-140B, Nariman Point,
Western Express Highway, Mumbai – 400 021
Sahar Road Junction, Tel: +91 22 2287 6320
Vile Parle (E), Fax: +91 22 2204 0813
Mumbai – 400 057 Contact person: Mr. Luis DSouza
Tel: +91 22 4035 7458 Email: luis.dsouza@ingvysyabank.com
Fax: +91 22 4035 7657 Website: www.ingvysyabank.com
Contact person: Mr. Swapnil Pavale SEBI Registration No. INBI00000022
Email: swapnilpavale@hsbc.co.in
Website: www.hsbc.co.in
SEBI Registration No. INBI00000027

IndusInd Bank Limited Kotak Mahindra Bank Limited

Cash Management Services, 5th Floor, Dani Corporate Park,
IBL House, 1st Floor, 158, CST Road,
Cross “B” Road, Kalina
MIDC, J.B. Nagar, Santacruz(E)
Off Andheri – Kurla Road, Mumbai -400 098
Andheri (East), Tel: +91 22 4035 7458
Mumbai – 400 059 Fax: +91 22 4035 7657
Tel: +91 22 6772 8721 Contact person: Mr. Amit Kumar
Fax: +91 22 6641 2349 Email: amit.kr@kotak.com
Contact person: Mr. Suresh Esaki/ Harpal Singh Website: www.kotak.com
Email: suresh.esaki@indusind.com SEBI Registration No. INBI00000927
singh.harpal@indusind.com
Website: www.indusind.in
SEBI Registration No. INBI00000002

HDFC Bank Limited Standard Chartered Bank

FIG – OPS Department, 270 D.N. Road, Fort,
Lodha, Mumbai – 400 001
I Think Tehcno Campus, Tel: +91 22 2268 3955
O-3, Level, Fax: +91 22 2209 2216
Kanjurmarg (East), Contact person: Mr. Joseph George
Mumbai – 400 042 Email: joseph.george@sc.com
Tel: +91 22 3075 2928 Website: www.standardchartered.com
Fax: +91 22 2579 9801 SEBI Registration No. INBI00000885
Contact person: Mr. Deepak Rane
Email: deepak.rane@hdfcbank.com
Website: www.hdfcbank.com
SEBI Registration No. INBI00000063

- 35 -
Bankers to the Company:

THE ROYAL BANK OF SCOTLAND N.V. ABU DHABI COMMERCIAL BANK

74, 7th Floor, 75 Rehmat Manzil,
Sakhar Bhavan, Veer Nariman Road,
Nariman Point, Churchgate,
Mumbai – 400 021 Mumbai – 400 020
Tel: +91 22- 66372413 Tel: +91 22- 39534100, 22855658
Fax: +91 22- 66372455 Fax:+91 22- 22870686

ALLAHABAD BANK ANDHRA BANK

41, Mount Road, Corporate Finance Branch,
Chennai – 600 002 16th, Earnest House,
Tel: +91 44- 24546272/7497, NCPA Marg,
Fax: +91 44- 28555959 Nariman Point,
Mumbai – 400 021
Tel: +91 22- 22885846
Fax: +91 22- 22885841

AXIS BANK BANK OF AMERICA

Maker Towers, ‘F’, 16th Floor, Express Towers,
13th Floor, Cuffe Parade, Colaba, Mumbai – 400 005 Nariman Point, Mumbai – 400 021
Tel: +91 22- 67074407 Tel: +91 22- 66323352
Fax: +91 22- 22186944/1429 Fax: +91 22- 66323114

BANK OF BAHRAIN & KUWAIT BANK OF BARODA

Jolly Maker Chambers II, 225, Corporate Financial Services Branch,
Nariman Point, 3, Hirachand Walchand Marg, Ballard Pier,
Mumbai – 400 021 Mumbai – 400 001
Tel: +91 22- 22823698 / 99 Tel: +91 22- 43407301/02,43407318
Fax: +91 22- 22044458 / 22841416 Fax: +91 22- 22655778/22610413

BANK OF CEYLON BANK OF INDIA

No. 1090, Poonamallee High Road, Bank of India Building
Chennai – 600 084 4th Floor, 70-80
Tel: +91 44-26420972/73/74/76 M.G. Road Fort,
Fax: +91 44- 25325590 Mumbai – 400 023
Tel:+91 22- 22610918, 22696817
Fax: +91 -22 22650634 /22671718

BANK OF MAHARASHTRA BANK OF RAJASTHAN

1St Floor, Janmangal Old No. 15, New No. 26,
45/47, Mumbai Samachar Marg Gopalakrishan Street, Pondy Bazar,
Fort ,Mumabi-400023 T-Nagar,
Tel: +91 22 2265 2595 Chennai – 600 017 (TN)
Fax: +91 22 2265 2912 Tel: +91 44- 28157290, 32558890
Fax: +91 44-28157290

- 36 -
BANK OF TOKYO – MITSUBISHI UFJ LIMITED SYNDICATE BANK
15th Floor, Hoechst House, 193, 82,B Pokar Mansion
Vinay K. Shah Marg, N. G. Acharya Marg,Govandi
Nariman Point, Chembur, Mumbai-400071
Mumbai – 400 021 Tel :022-25214476
Tel: +91 22- 66693000 Fax:022-2522015
Fax: +91 22- 66693010

CANARA BANK CALYON BANK

101, 1st Floor, Dalamal Towers,
B Wing, Free Press Journal Marg,
Nariman Point,
Mumbai – 400 021
Tel: +91 22- 22846723/6921/6923
Fax: +91 22-22844963
Westminster 2nd Floor,
New No.70, Old No. 108,
Dr. Radhakrishnan Salai Mylapore,
Chennai – 600 004
Tel : +91 44- 66351000
Fax : +91 44- 28474619

CENTRAL BANK OF INDIA CHINA TRUST COMMERCIAL BANK

Chandremukhi A-1-16,Wenger House
Nariman Point, Rajiv Chowk,Cannught Place
Mumbai – 400 021 New Delhi-110001
Tel : +91 22- 40785801/39 Tel: +91 11-23731815
Fax: +91 22- 40785840

CITI BANK N. A. CITY UNION BANK LIMITED

Citi centre, 402, Jains Arcade,
7th Floor, 14th Road Junction, Khar (W),
Bandra-Kurla Mumbai – 400 052
Complex, Bandra (E), Tel: +91 22-26040632, 26055575
Mumbai – 400 051. Fax: +91 22-26043907
Tel: +91 22-40015028,
Fax: +91 22-26535872

CORPORATION BANK DBS BANK LIMITED

Fort Mumba Branch, 3rd Floor, Fort House,
Gr. Floor, Veena Chambers, 221, Dr. D. N. Road, Fort,
Dalal Steet, Mumbai – 400 001
Mumbai – 400 023 Tel: +91 22-66388888
Tel: + 91 22- 22671715 Fax: +91 22-66388897
Fax: +91 22-22672101

DENA BANK DEUTSCHE BANK A. G.

Sapthgiri Apartment, Kodak House
83, T. T. K. Road, 222-Dr. D.N. Road
Alwarpet, Fort , Mumbai
Chennai – 600 018 Tel: +91 22- 66703056
Tel: +91 44-24994279 Fax:+91 22-66703065
Fax: -+91 44-24988892

- 37 -
DEVELOPMENT CREDIT BANK LIMITED
Corporate Office,
301, Trade Plaza,
414, Veer Savarkar Marg,
Prabhadevi,
Mumbai – 400 025
Tel: +91 22- 66187297 /99
Fax: +91 22-24231520 /26
HDFC BANK LIMITED
Process House,
2nd Floor, Kamala Mills Compound,
Lower Parel,
Mumbai – 400 013
Tel: +91 22-24961616/24988484
Fax: +91 22-24963994/24968135
ICICI BANK LIMITED
ICICI Bank Towers,
Bandra-Kurla Complex,
Bandra (E),
Mumbai – 400 051
Tel: +91 22- 26536428/80
Fax: +91 22-26531206
INDIAN OVERSEAS BANK
Merchant Chamber, Ground Floor,
New Marine Line,
Mumbai – 400 020
Tel:+91 22-22016822/2528
Fax: +91 22- 22036621
IDBI Bank Limited
IDBI Towers,
WTC Complex,
Cuffe Parade,
Mumbai – 400 005
Tel: +91 22- 66553355/22187111
Fax: +91 22-22180411
TAMILAND MERCANTILE BANK LIMITED
101-104, Goradia House,
Kazi Syed Street, Mandvi,
Mumbai – 400 003
Tel: +91 22-23415624/23413140
Fax: +91 22-23401667
- 38 -
FEDERAL BANK LIMITED
1st Floor, Raj Bahadur mansion
32, Mumbai Samachar Marg
Fort, Mumbai-400001
Tel: +91 22-22812335
Fax: +91 22-22028726
THE HONGKONG AND SHANGHAI BANKING
CORPORATION LIMITED
52/60, Mahatma Gandhi Road,
Mumbai – 400 001
Tel: +91 22-22680011
Fax: +91 22-22680254
INDIAN BANK
325, Gitanjali Building,
Nehru Road, Vile Parle (E),
Mumbai – 400 057
Tel: +91 22- 26146662/26148753
Fax: +91 22- 26174297
INDUSIND BANK
1st Floor Indusind House
425, Dr. D.B. Marg
Opera House , Mumbai-400004
Tel: +91 22-43457506
ING VYSYA BANK
602-B, Poonam Chambers,
A Wing,
Dr. A B Road, Worli,
Mumbai – 400 018
Tel: +91 22- 66666489
Fax:+91 22- 66666449
JP MORGAN CHASE BANK N.A.
J P Morgan Tower
Off CST Road , Kalina
Santa Cruz (E)
Mumbai-400021
Tel: +91 22 61573000
KARUR VYSYA BANK LIMITED
P. N. No. 1414,
Kamanwala Chambers,
Sir P. M. Road, Fort, Mumbai – 400 001
Tel: +91 22- 22665467/22665914
Fax:+91 22- 22612761
KARNATAKA BANK LIMITED
294/A, Haroon House,
Perin Nariman Street, Fort,
Mumbai – 400 001
Tel: +91 22-22662283/22663256
Fax:+ 91 22- 22661685

KOTAK MAHINDRA BANK LIMITED THE LAKSHMI VILAS BANK LIMITED

13th Floor, Nariman Bhavan, No. 64, Dr. V. B. Gandhi Marg,
227 Nariman Point, Kalaghoda, Fort,
Mumbai – 400 021 Mumbai – 400 001
Tel: +91 22-66596393 Tel : +91 22-22672247/22672255
Fax: +91 22-22817527 Fax : +91 22-22670267

ORIENTAL BANK OF COMMERCE PUNJAB & SIND BANK

Shreeji Chambers, 165 Thambu Chetty Street,
Tata Road No.2, Chennai – 600 001
Opera House, Tel: +91 44 22342562/25359665
Mumbai – 400 004 Fax: +91 44-25342016
Tel: +91 22- 23643571/2/3/4
Fax:+91 22-23637667

PUNJAB NATIONAL BANK THE RATNAKAR BANK LIMITED

10, Raja Street, T. Nagar, 7, Homji Street,
Chennai – 600 001 Rohimtoola House,
Tel :+91 44 24333934 Horniman Circle, Fort,
Fax : +91 44-24341050 Mumbai – 400 001
Tel: +91 22-22703635/22703638
Fax: +91 22-22703639

SHINHAN BANK THE SOUTH INDIAN BANK LIMITED

42, Jolly Maker Chambers II,
Nariman Point, Mumbai – 400 021
Tel: +91 22-22822200
Fax: +91 22-22884277
289, Emca House,
S. B. Singh Road, Fort,
Mumbai – 400 038
Tel: +91 22-22611209/22658974
Fax: +91 22- 22614749

STANDARD CHARTERED BANK STATE BANK OF INDORE

Box 725, 90, Sterling Centre,
Mahatma Gandhi Road, Dr. Annie Basant Road, Worli,
Fort, Mumbai – 400 023 Mumbai – 400 018
Tel: +91 22- 22673516 Tel: +91 22-24952404 / 24929633
Fax: +91 22-22655295 Fax: +91 22-24938903

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STATE BANK OF BIKANER AND JAIPUR
United India Life Building,
Sir P. M. Road, Fort,
Mumbai – 400 023
Tel: +91 22-22663189/22662573
Fax: +91 22-22660875
STATE BANK OF HYDERABAD
C-11, Mittal Tower, 210,
Nariman Point,
Mumbai – 400 021
Tel: +91 22-228433550/ 3543/4096
Fax: +91 22-22841096
STATE BANK OF MAURITIUS LIMITED
101, Raheja Centre,
Free Press Journal Road,
Nariman Point, Mumbai – 400 021
Tel: +91 22-22846560/22842965
Fax: +91 22-22842966
STATE BANK OF PATIALA
Commercial Branch,
Atlanta, 1st Floor, Nariman Point,
Mumbai – 400 021
Tel: + 91 22-22851775/22851762
Fax: +91 22-66375703
UCO BANK
Flagship Corporate Branch,
1st Floor, Mafatlal Centre,
Nariman Point, Mumbai – 400 021
Tel: +91 22-40549191
Fax:+91 22-40549122
UNITED BANK OF INDIA
Hotel Oberai Towers Branch,
Hotel Oberai Towers Building,
Nariman Point, Mumbai – 400 021
Tel: +91 22-22047121
Fax: +91 22-22026366
- 40 -
SOCIETE GENERALE CORPORATE &
INVESTMENT BANKING
Maker Chamber IV,
13th Floor, Nariman Point,
Mumbai 400 021
Tel: +91 22- 66309500
Fax:+91 22-22045459
STATE BANK OF INDIA
Leather & International Branch,
Mid Corporate Group,
MVJ Towers, 177/1, P. H. Road,
Kalipauk,
Chennai – 600 010
Tel: +91 44 28287902
Fax: +91 44-28360456
STATE BANK OF MYSORE
# 224, C Wing, Mittal Court,
Nariman Point, Mumbai – 400 021
Tel: +91 22-22790534
Fax: +91 22-22044281
STATE BANK OF TRAVANCORE
Commercial Branch,
Jeevan Anand,
556, Anna Salai, Teynampet,
Chennai – 600 018
Tel: +91 44-24359435/24359432
Fax: +91 44-24351671
UNION BANK OF INDIA
Union Bank Bhavan,
239, Vidhan Bhavan Marg,
Nariman Point, Mumbai – 400 021
Tel: +91 22-22892150/22892022
Fax:+ 91 22-22855037
VIJAYA BANK
29 Clover Apartment,
Cuffe Parade,
Colaba, Mumbai – 400 005
Tel: +91 22-22186515/22163590
Fax: +91 22-22182546
YES BANK LIMITED
4th Floor, Nehru Centre,
Worli, Mumbai – 400 018
Tel: + 91 22-66699197
Fax:+ 91 22-24901128
MIZUHO CORPORATE BANK LIMITED
Maker Chamber III
1st Floor Jamnalalbajaj Road
Nariman Point, Mumbai -400021
Tel: 022-22886638
Fax:022-22886640
Lead Brokers to the Issue:
Bajaj Capital Investor Services Limited
97, Bajaj House, Nehru Place,
New Delhi – 110 019
Tel: + 91 011 4169 3000
Fax: +91 011 6660 8888
Contact person: Mr. Harish Sabharwal
Email: harishs@bajajcapital.com
Website: www.justtrade.in
SEBI Registration No. INB 2312269334
Edelweiss Securities Limited
14th Floor, Express Towers
Nariman Point,
Mumbai – 400 021
Tel: +91 22 6747 1341
Fax: +91 22 6747 1347
Contact person: Mr. Amit Dalvi
Email: amit.dalvi@edelcap.com
Website: www.edelcap.com
SEBI Registration No. INB 231193310
Kotak Securities Limited
1st Floor, Nirlon House,
Dr. A.B. Road, Worli,
Mumbai – 400 025
Tel: +91 22 6740 9431
Fax: +91 22 6661 7041
Contact person: Mr. Sanjeeb Kumar Das
Email: sanjeeb.das@kotak.com
Website: www.kotak.com
SEBI Registration No. INB 230808130
Integrated Securities Limited
5A, 5th Floor,
Kences Towers, No.1,
Ramkrishna Street, T.Nagar,
Chennai – 600 017
Tel: +91 22 4066 1800
Fax: +91 22 2287 4676
DHANLAXMI BANK LTD
Gr. Floor, Janambhoomi Bhavan
Janambhoomi Marg Fort
Mumbai-400013
Tel:+91 22-22022943
Fax: +91 22-22871637
Karvy Stock Broking Limited
“KARVY HOUSE”, 46,
Avenue 4, Street No.1,
Banjara Hills,
Hyderabad – 500 034
Tel: +91 040 2331 2454
Fax: +91 040 6662 1474
Contact person: Mr. D. Jayantkumar
Email: jayantkumard@karvy.com
Website: www.karvy.com
SEBI Registration No. INB 230770138
Enam Securities Private Limited
Khatau Building, 2nd Floor,
44 Bank Street, Fort,
Mumbai – 400 001
Tel: +91 22 22677901
Fax: +91 22 22665613
Contact person: Ajay Sheth/ Vinay Ketkar
Email: ajays@enam.com
Website: www.enam.com
SEBI Registration No. INB 230468326
SMC Global Securities Limited
11/6B, Shanti Chamber,
Pusa Road,
New Delhi – 110 005
Tel: +91 98186 20470
Fax: +91 011 2326 1059
Contact person: Mr. Mahesh Gupta
Email: mkg@smcindiaonline.com
Website: www.smcindiaonline.com
SEBI Registration No. INB 230771431
HDFC Securities Limited
ITHINK Techno Campus,
Building “B” Alpha,
Office Floor 8 ,
Opp. Crompton Greaves Factory,
Kanjurmarg(E),
Mumbai – 400 042
- 41 -
Contact person: Mr. V. Krishnan, Director Contact person: Mr. Prashant Singh
Email: krishnan_v@iepindia.com Tel: +91 22 3075 3436
Website: www.cubsharebroking.com Fax: +91 22 3075 3458
SEBI Registration No. INB231271835 Email: fps@hdfcsec.com
Website: www.hdfcsec.com
SEBI Registration No. INB 231109431

Impersonation

As a matter of abundant precaution, attention of the investors is specifically drawn to the provisions of sub-section (1) of
section 68A of the Act, relating to punishment for fictitious applications.

Minimum Subscription

If our Company does not receive the minimum subscription of 75 % of the Base Issue, i.e. Rs. 18,750 lacs, prior to
allotment, the entire subscription shall be refunded to the applicants within 30 days from the date of closure of the Issue.
If there is delay in the refund of subscription by more than 8 days after our Company becomes liable to pay the
subscription amount, our Company will pay interest for the delayed period, at rates prescribed under sub-sections (2) and
(2A) of Section 73 of the Companies Act, 1956.

Credit Rating and Rationale

Credit Ratings issued by CARE in connection with the Issue:

The Secured NCDs proposed to be issued under this Issue have been rated ‘CARE AA+’ for an amount of upto Rs.
50,000 Lacs and the Unsecured NCDs proposed to be issued under this Issue have been ‘CARE AA’ by CARE for an
amount of upto Rs. 50,000 Lacs vide their letter dated April 19, 2010. The rating of the Secured NCDs as well as the
Unsecured NCDs by CARE indicates high safety for timely servicing of debt obligations and carrying low credit risk.
The rationale for the aforementioned credit ratings issued by CARE is as follows:

“The rating factors in STFCL’s dominant position and almost three decades of experience in the pre-owned commercial
vehicle (CV) financing segment, its overall healthy profitability parameters, its strong resource raising capabilities, and
its proactive and experienced management. The rating is however constrained by STFCL’s concentration in a single
asset class and the underlying industry risk linked with its target customer segment of Small Truck Operators, which may
be relatively more vulnerable to an economic downturn.

STFCL’s ability to maintain the asset quality of its portfolio, which has grown rapidly in recent years, timely infusion of
additional capital to fuel growth and maintaining its spreads would remain key rating sensitivities.”

Disclaimer

CARE’s ratings are opinions on credit quality and are not recommendations to sanction, renew, disburse or recall the
concerned bank facilities or to buy, sell or hold any security. CARE has based its ratings on information obtained from
sources believed by it to be accurate and reliable. CARE does not, however, guarantee the accuracy, adequacy, or
completeness of any information and is not responsible for any errors or omissions or for the results obtained from the
use of such information. Most entities whose bank facilities/instruments are rated by CARE have paid a credit rating fee,
based on the amount and type of bank facilities/instruments.

Credit Ratings issued by CRISIL in connection with the Issue:

The Secured NCDs and the Unsecured NCDs proposed to be issued under this Issue have both been rated ‘AA/Stable’
each for an amount of upto Rs. 50,000 Lacs by CRISIL vide their letter dated April 27, 2010. The rating of the Secured
NCDs as well as the Unsecured NCDs by CRISIL indicates high degree of safety with regard to timely payment of
interest and principal on the instrument. The rationale for the aforementioned credit ratings issued by CRISIL is as
follows:

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The ratings reflect STFCL’s strong market position in the pre-owned commercial vehicle (CV) finance segment, healthy
capitalisation, stable asset quality, and healthy earnings profile. These rating strengths are partially offset by the
company’s average, though improving, resource profile, and limited diversity in its business profile.

STFCL is a major player in the domestic CV finance segment, with assets under management of Rs.282 billion as on
December 31, 2009. It is the leader in the pre-owned CV finance segment, with a market share of around 25 per cent.
STFCL has also improved its market position in the new CV finance segment, with a current market share of around 8
per cent. The company lends predominantly to the single road transport operator (SRTO) segment, which accounts for
more than 95 per cent of its outstanding portfolio.

STFCL is strongly capitalised; as on December 31, 2009, it had a large net worth of Rs.31 billion, and a capital
adequacy ratio (CAR), as a proportion of risk-weighted assets, of 17 per cent. While STFCL has large growth plans and
had a gearing of 7.3 times as on December 31, 2009, CRISIL expects STFCL to maintain its healthy capitalisation given
its ability to access the equity markets. Furthermore, STFCL has a sound earnings profile, supported by its focus on the
high-yield SRTO segment, and a steady improvement in its operating efficiency ratio. The company’s profits have grown
significantly in the past few years; the return on assets (RoA, annualised) stood at 3.1 per cent for the nine-month
period, April to December 2009. STFCL has also maintained its stable asset quality, supported by its well-established
origination, valuation, and collection mechanisms aligned to the prevailing business practices in the SRTO segment. The
company’s gross nonperforming assets (NPAs), at 2.4 per cent as on December 31, 2009, as against 2.2 per cent as on
March 31, 2009, compares well with the industry average levels in the CV finance segment.

However, STFCL’s resource profile is average; while its cost of funds is estimated to decline in 2009-10 (refers to
financial year, April 1 to March 31) from that in 2008-09, it will remain higher than that of its peers. This is because the
company is largely dependent on wholesale borrowings; borrowings from banks and financial institutions constituted
around 86 per cent of its total borrowings as on December 31, 2009. The company, however, is expected to diversify its
funding profile gradually with issuances of retail non-convertible debentures and higher loan assignment
transactions. STFCL’s business continues to be highly dependent on the CV finance market, which is cyclical and
intensely competitive, with entryof players likely to add to pricing and yield pressures.

Disclaimer:

CRISIL rating reflects CRISIL's current opinion on the likelihood of timely payment of the obligations under the rated
instrument and does not constitute an audit of the rated entity by CRISIL. CRISIL ratings are based on information
provided by the issuer or obtained by CRISIL from sources it considers reliable. CRISIL does not guarantee the
completeness or accuracy of the information on which the rating is based. A CRISIL rating is not a recommendation to
buy, sell, or hold the rated instrument; it does not comment on the market price or suitability for a particular investor.
All CRISIL ratings are under surveillance. Ratings are revised as and when circumstances so warrant. CRISIL is not
responsible for any errors and especially states that it has no financial liability whatsoever to the subscribers / users /
transmitters / distributors of this product.

Utilisation of Issue proceeds

Our Board of Directors certifies that:

• all monies received out of the Issue shall be credited/transferred to a separate bank account other than the bank
account referred to in sub-section (3) of Section 73 of the Act;

• details of all monies utilised out of the Issue referred above shall be disclosed under an appropriate separate
head in our balance sheet indicating the purpose for which such monies have been utilised;

• details of all unutilised monies out of the Issue, if any, shall be disclosed under an appropriate head in our
balance sheet indicating the form in which such unutilised monies have been invested; and

• we shall utilize the Issue proceeds only upon creation of security as stated in this Prospectus in the section titled
“Issue Structure” on page 165.

- 43 -
• the Issue proceeds shall not be utilized towards full or part consideration for the purchase or any other
acquisition, inter alia by way of a lease, of any property.

Issue Programme

The subscription list for the Issue shall remain open for subscription at the commencement of banking hours and shall
close at the close of banking hours on the dates indicated below or earlier or on such date, as may be decided at the
discretion of the Board of Directors or any committee of the Board of Directors of our Company subject to necessary
approvals

ISSUE OPENS ON May 17, 2010

ISSUE CLOSES ON May 31, 2010
The subscription list for the Issue shall remain open for subscription at the commencement of banking hours and close at the close of banking hours on
the dates indicated above or earlier or on such date as may be decided at the discretion of the Committee of Directors of our Company subject to
necessary approvals. In the event of such early closure of subscription list of the Issue, our Company shall ensure that notice of such early closure is
given at least three days prior to such early date of closure.

- 44 -
 SUMMARY OF BUSINESS, STRENGTH & STRATEGY

Overview

We are the largest asset financing NBFC with a primary focus on financing pre-owned commercial vehicles*. We are
among the leading financing institutions in the organized sector for the commercial vehicle industry in India for FTUs
and SRTOs. We also provide financing for passenger commercial vehicles, multi-utility vehicles, three wheelers, tractors
and construction equipment. In addition, we provide ancillary equipment and vehicle parts finance, such as loans for
tyres and engine replacements, and provide working capital facility for FTUs and SRTOs. We also provide ancillary
financial services targeted at commercial vehicle operators such as freight bill discounting and also market co-branded
credit cards targeted at commercial vehicle operators in India, thereby providing comprehensive financing solutions to
the road logistics industry in India. In addition, we also provide personal loans to the existing customers.

* Based on financial and non financial parameters for the financial year 2009 for selected NBFCs as contained in the
D&B Research Report, [Source: Dun & Bradstreet Research Report]

Our Company was established in 1979 and we have a long track record of over three decades in the commercial vehicle
financing industry in India. The Company has been registered as a deposit-taking NBFC with the RBI since September
4, 2000 under Section 45IA of the Reserve Bank of India Act, 1934. We are a part of the Shriram group of companies
which has a strong presence in financial services in India, including commercial vehicle financing, consumer finance,
life and general insurance, stock broking, chit funds and distribution of financial products such as life and general
insurance products and mutual fund products, as well as a growing presence in other businesses such as property
development, engineering projects and information technology.

Our widespread network of branches across India has been a key driver of our growth over the years. As of December
31, 2009 we had 482 branches across India, including at most of the major commercial vehicle hubs along various road
transportation routes in India. We have also strategically expanded our marketing network and operations by entering
into partnership and co-financing arrangements with private financiers in the unorganized sector involved in commercial
vehicle financing. As of December 31, 2009 our total employee strength was approximately 12,823.

We have demonstrated consistent growth in our business and in our profitability. Our Assets Under Management
includes Assets Under Management in the books of the Company, assets that have been securitized / assigned by us and
portfolio managed by the Company under portfolio management arrangements with banks and other institutions from
which we receive fee income for the provision of client sourcing and collection activities. Our Assets Under
Management* has grown by a compounded annual growth rate, or CAGR*, of 38.87 % from Rs. 1,208,828.79 lacs
(comprising Assets Under Management in the books of the Company of Rs. 842,456.87 lacs, loan assets
securitized/assigned of Rs. 3,14,054.92 lacs and portfolio managed by the Company* of Rs. 52,317.00 lacs) as of March
31, 2007 to Rs. 2,331,303.66 lacs (comprising Assets Under Management in the books of the Company of Rs.
1,795,590.15 lacs, loan assets securitized/assigned of Rs. 5,31,092.91 lacs and portfolio managed by the Company* of
Rs. 4,620.60lacs) as of March 31, 2009. Our Assets Under Management as of December 31, 2009*, was Rs.
2,816,909.42 lacs (comprising Assets Under Management in the books of the Company of Rs. 2,154,258.75 lacs, loan
assets securitized /assigned of Rs. 6,62,623.83 lacs and portfolio managed by the Company* of Rs. 26.84 lacs). Our
capital adequacy ratio as of March 31, 2009 and December, 2009 was 16.35% and 17.07 %, respectively, compared to
the RBI stipulated minimum requirement of 12.00%. Our Tier 1 capital as of December 31, 2009 was Rs. 285,727.21
lacs. Our Gross NPAs as a percentage of Total Loan Assets were 2.14% and 2.43% as of March 31, 2009 and December
31, 2009 respectively. Our Net NPAs as a percentage of Net Loan Assets was 0.83% and 0.67% as of March 31, 2009
and December 31, 2009, respectively.

Our total income increased from Rs. 142,138.60 lacs in fiscal 2007 to Rs. 373,112.97 lacs in fiscal 2009, at a CAGR of
62.02%. Our net profit after tax increased from Rs. 19,039.71 lacs in fiscal 2007 to Rs. 61,240.21 lacs in fiscal 2009, at a
CAGR of 79.34%. In the nine months ended December 31, 2009, our total income and net profit after tax were Rs.
327,039.34 lacs and Rs. 60,868.68 lacs, respectively.
* Please note these figures are based on certificates provided by the management.

Recent Developments

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Allotment of Equity Shares pursuant to our Company’s ESOP scheme

On March 26, 2010 our Company has issued and allotted 1,084,700 Equity Shares at a price of Rs. 35 per Equity Share
pursuant to the exercise of stock options issued under our ESOP scheme. Our Company has made separate applications
all dated April 13, 2010, to MSE, NSE, and BSE in connection with obtaining approval therefrom, for trading of the
aforementioned Equity Shares. We have recevied approvals for the trading of the aforementioned Equity Shares from the
BSE and the MSE vide their letters dated April 19, 2010 and April 30, 2010, respectively. The approval from the NSE in
connection with the trading of the aforementioned Equity Shares is still awaited.

Allotment of Equity Shares pursuant to Chapter VIII of the Securities and Exchange Board of India (Issue of Capital and
Disclosure Requirements) Regulations, 2009

On January 28, 2010, our Company issued and allotted 11,658,552 Equity Shares of at a price of Rs.500.80 per such
Equity Share, aggregating to Rs. 58,386.03 lacs to Qualified Institutional Buyers pursuant to the provisions of Chapter
VIII of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as
amended.

Incorporation of a subsidiary of our Company

Shriram Automall India Limited, a subsidiary of our Company was incorporated pursuant to a certificate of incorporation
dated February 11, 2010 issued by the Registrar of Companies, Chennai, Tamil Nadu and is having its registered office
situated at 123, Angappa Naickan Street, Chennai 600001,Tamil Nadu, India.

Acquisition of Receivables Portfolio

Pursuant to the terms of an Assignment Agreement dated December 22, 2009 (the “Assignment Agreement”) between
the Company, GE Capital Services India and GE Capital Financial Services (collectively, the “GE Entities”), we have
acquired with effect from December 24, 2009 from the GE Entities, on a non-recourse basis, a certain portfolio of
receivables in connection with certain loan facilities relating to commercial vehicle loans and construction equipment
loans (the “GE Receivables”), together with all right, title and interest therein under the relevant underlying loan and
security documents relating to the GE Receivables as of November 28, 2009.

Our Strengths

We believe that the following are our key strengths:

The largest asset financing NBFC providing commercial vehicle finance*

We are the largest asset financing NBFCs, with particular focus on financing pre-owned commercial vehicles*. We
primarily cater to FTUs and SRTOs and we believe we are among the leading financing institutions in the organized
sector in this particular segment. Our widespread network of 482 branches across India as of December 31, 2009 enables
us to access a large customer base including in most major and minor commercial vehicle hubs along various road
transportation routes in India. We believe that our widespread branch network enables us to service and support our
existing customers from proximate locations which provide customers easy access to our services. We have also
strategically expanded our marketing and customer origination network by entering into partnership and co-financing
arrangements with private financiers involved in commercial vehicle financing. We believe our relationship with these
partners is a critical factor in sourcing new customers and enhancing reach and penetration at low upfront capital cost.
The relationships we have developed with our customers provide us with opportunities for repeat business and to cross
sell our other products as well as derive benefit from customer referrals.

* Based on financial and non financial parameters for the financial year 2009 for selected NBFCs as contained in the
D&B Research Report, [Source: Dun & Bradstreet Research Report]

Our Assets Under Management as of December 31, 2009*, was Rs. 2,816,909.42 lacs (comprising Assets Under
Management in the books of the Company of Rs. 2,154,258.75 lacs, loan assets securitized /assigned of Rs. 662,623.83
- 46 -
lacs and portfolio managed by the Company* of Rs. 26.84lacs). This is supported by a strong capital base, with share
capital of Rs. 21,279.86 lacs and reserves and surplus of Rs. 286,716.43 lacs as of December 31, 2009. Our capital
adequacy ratio as of December 31, 2009 was 17.07%, compared to the RBI stipulated minimum requirement of 12.00%.
Our Tier 1 capital as of December 31, 2009 was Rs. 285,727.21 lacs.

* Please note these figures are based on certificates provided by the management.

Our Assets under Management as on May 5, 2010 is Rs. 30,052.63 crore, including assets in the books of our Company
of Rs. 19,253.93 crore and loan assets securitised/assigned of Rs. 10,798.70 crore.

Access to a range of cost effective funding sources

We fund our capital requirements through a variety of sources. Our fund requirements are currently predominantly
sourced through term loans from banks, issue of redeemable non-convertible debentures, and cash credit from banks
including working capital loans. We access funds from a number of credit providers, including nationalized banks,
private Indian banks and foreign banks, and our track record of prompt debt servicing has allowed us to establish and
maintain strong relationships with these financial institutions. We also place commercial paper and access inter-
corporate deposits. As a deposit-taking NBFC, we are also able to mobilize retail fixed deposits at competitive rates. We
have also raised subordinated loans eligible for Tier II capital. We undertake securitization/assignment transactions to
increase our capital adequacy ratio, increase the efficiency of our loan portfolio and as a cost effective source of funds.

In relation to our long-term debt instruments, we currently have ratings of CARE AA+ from Credit Analysis and
Research Ltd. (“CARE”) and AA (Ind) from FITCH. In relation to our short-term debt instruments, we have also
received ratings of F1+ from FITCH and P1+ from CRISIL. We believe that we have been able to achieve a relatively
stable cost of funds despite the difficult conditions in the global and Indian economy in fiscal 2008 and 2009 and the
resultant reduced liquidity and an increase in interest rates, primarily due to our improved credit ratings, effective
treasury management, and innovative fund raising programs. We believe we are able to borrow from a range of sources
at competitive rates. The Secured NCDs proposed to be issued under this Issue have been rated ‘CARE AA+’ by CARE
for an amount of upto Rs. 50,000 Lacs and ‘AA/Stable’ by CRISIL for an amount of upto Rs. 50,000 Lacs vide their
letters dated April 19, 2010 and April 27, 2010, respectively and the Unsecured NCDs proposed to be issued under this
Issue have been rated ‘CARE AA’ by CARE for an amount of upto Rs. 50,000 Lacs and ‘AA/Stable’ by CRISIL for an
amount of upto Rs. 50,000 Lacs vide their letters dated April 19, 2010 and April 27, 2010, respectively. The rating of
the Secured NCDs as well as the Unsecured NCDs by CARE indicates high safety for timely servicing of debt
obligations and carrying low credit risk while the rating of the Secured NCDs as well as the Unsecured NCDs by
CRISIL indicates stability.The ratings provided by CARE and/or CRISIL may be suspended, withdrawn or revised at
any time by the assigning rating agency and should be evaluated independently of any other rating.

The RBI currently mandates domestic commercial banks operating in India to maintain an aggregate of 40.00% (32.00%
for foreign banks) of their advances or credit equivalent amount of off-balance sheet exposure, whichever is higher as
“priority sector advances”. These include advances to agriculture, small enterprises (including SRTOs, which constitute
the largest proportion of our loan portfolio), exports and similar sectors where the Government seeks to encourage flow
of credit for developmental reasons. Banks in India that have traditionally been constrained or unable to meet these
requirements organically, have relied on specialized institutions like us that are better positioned to or exclusively focus
on originating such assets through on-lending or purchase of assets or securitized/assigned pools to comply with these
targets. Our securitized/assigned asset pools are particularly attractive to these banks as such transactions provide them
with an avenue to increase their asset base through low cost investments and limited risk. Majority of our loan portfolio
being classified as priority sector lending also enables us to negotiate competitive interest rates with banks and other
financial institutions. In fiscal 2008 and 2009, the total book value of loan assets securitized/assigned was Rs.
211,822.17 lacs and Rs. 312,498.40 lacs, respectively. In the nine months ended December 31, 2009, the total book value
of loan assets securitized/assigned was Rs. 326,229.88 lacs.

Unique business model and a track record of strong financial performance

We primarily cater to FTUs and SRTOs and we believe we are the only financing institution in the organized sector
providing finance to FTUs and SRTOs in the pre-owned commercial vehicle finance segment. Most of our customers are
not a focus segment for banks or other NBFCs as these customers lack substantial credit history and other financial
documentation on which many of such financial institutions rely to identify and target new customers. As the market for
- 47 -
commercial vehicle financing, especially the pre-owned commercial vehicle financing, is fragmented, we believe our
credit evaluation techniques, relationship based approach, extensive branch network and strong valuation skills make our
business model unique and sustainable as compared to other financiers. In particular, our internally-developed valuation
methodology requires deep knowledge and practical experience developed over a period of time, and we believe this is a
key strength that is difficult to replicate. We provide finance to pre-owned commercial vehicle operators at favourable
interest rates and repayment terms as compared to private financiers in the unorganized sector.

Our retail focus, stringent credit policies and relationship based model has helped us maintain relatively low NPA levels.
Our Gross NPAs as a percentage of Total Loan Assets were 2.14% and 2.43% as of March 31, 2009 and December 31,
2009 respectively. Our Net NPAs as a percentage of Net Loan Assets was 0.83% and 0.67% as of March 31, 2009 and
December 31, 2009, respectively.

Strong brand name

We believe that the "Shriram" brand is well established in commercial vehicle financing throughout India. We believe
that we are the only organized sector financing company with particular focus on the pre-owned commercial vehicle
financing segment to FTUs and SRTOs in India. Our targeted focus on and the otherwise fragmented nature of this
market segment, our widespread branch network, particularly in commercial vehicle hubs across India, as well as our
large customer base has enabled us to build a strong brand. Our efficient credit approval procedures, credit delivery
process and relationship-based loan administration and monitoring methodology have also aided in increasing customer
loyalty and earn repeat business and customer referrals.

Extensive experience and expertise in credit appraisal and collection processes

We have developed a unique business model that addresses the needs of a specific market segment with increasing
demand. We focus on closely monitoring our assets and borrowers through product executives who develop long-term
relationships with commercial vehicle operators, which enables us to capitalize on local knowledge. We follow stringent
credit policies, including limits on customer exposure, to ensure the asset quality of our loans and the security provided
for such loans. Further, we have nurtured a culture of accountability by making our product executives responsible for
loan administration and monitoring as well as recovery of the loans they originate.

Extensive expertise in asset valuation is a pre-requisite for any NBFC providing loans for pre-owned assets. Over the
years, we have developed expertise in valuing pre-owned vehicles, which enables us to accurately determine a
recoverable loan amount for commercial vehicle purchases. We believe a tested valuation technique for these assets is a
crucial entry barrier for others seeking to enter our market segment. Furthermore, our entire recovery and collection
operation is administered in-house and we do not outsource loan recovery and collection operations. We believe that our
loan recovery procedure is particularly well-suited to our target market in the commercial vehicle financing industry, as
reflected by our high loan recovery ratios compared to others in the financial services industry, and we believe that this
knowledge and relationship based recovery procedure is difficult to replicate in the short to medium term.

Experienced senior management team

Our Board consists of 10 Directors, including representatives of Newbridge India Investments II Ltd (TPG Group) , with
extensive experience in the automotive and/or financial services sectors. Our senior and middle management personnel
have significant experience and in-depth industry knowledge and expertise. Most of our senior management team has
grown with the Company and have more than 15 years experience with us. Our management promotes a result-oriented
culture that rewards our employees on the basis of merit. In order to strengthen our credit appraisal and risk management
systems, and to develop and implement our credit policies, we have hired a number of senior managers who have
extensive experience in the Indian banking and financial services sector and in specialized lending finance firms
providing loans to retail customers.. We believe that the in-depth industry knowledge and loyalty of our management and
professionals provide us with a distinct competitive advantage.

Our Strategies

Our key strategic priorities are as follows:

- 48 -
Further expand operations by growing our branch network and increasing partnership and co-financing
arrangements with private financiers

We intend to continue to strategically expand our operations in target markets that are large commercial vehicle hubs by
establishing additional branches. Our marketing and customer origination and servicing efforts strategically focus on
building long term relationships with our customers and address specific issues and local business requirements of
potential customers in a particular region. We also intend to increase our operations in certain regions in India where we
historically had relatively limited operations, such as in eastern and northern parts of India, and to further consolidate our
position and operations in western and southern parts of India.

The pre-owned commercial vehicle financing industry in India is dominated by private financiers in the unorganized
sector. We intend to continue to strategically expand our marketing and customer origination network by entering into
partnership and co-financing arrangements with private financiers across India involved in commercial vehicle financing.
In view of the personnel-intensive requirements of our operations, we continue to focus on growing our business by
increasingly relying on partnership arrangements to effectively leverage the local knowledge, infrastructure and
personnel base of our partners.

Introduce innovative marketing and sales initiatives and build our brand to further grow market share

We continue to develop innovative marketing and customer origination initiatives specifically targeted at FTUs and
SRTOs. For example, we organize "Truck Bazaars" in several commercial vehicle hubs in India every month.
Customarily the sale and purchase of pre-owned commercial vehicles is made through brokers or intermediaries, with
limited transparency and access to information and suitable opportunities. At our Truck Bazaars, we provide a
comprehensive platform for access to information about pre-owned commercial vehicles available for purchase and sale,
a venue for transporters to buy and sell pre-owned commercial vehicles directly without the intervention of brokers, and
a facility for providing advisory services for a fee on such transactions, together with access to our financing products.
This initiative enables us to develop long standing relationships with repeat customers, and provides us with
opportunities to generate new business. These programs provide a platform to increase our brand awareness and enable
us to promote our financing products.

We also intend to develop pre-owned commercial vehicle hubs across India called "Automalls", through a wholly-owned
subsidiary incorporated for this purpose, designed to provide a trading platform for the sale of pre-owned commercial
vehicles, showrooms for branded new and refurbished pre-owned commercial vehicles manufactured by various
manufacturers, as well as commercial vehicles repossessed by financing companies. Through our Automalls, we intend
to set up a one-stop shop catering to the various needs of commercial vehicle owners, including through the provision of
workshop facilities. We intend to provide electronic advertising and trading infrastructure in these Automalls, such as
touch-screen kiosks, through which customers will be able to access real-time information on pre-owned vehicles
available for sale. These electronic touch-screen kiosk facilities, which will also be installed in our branches, will
eventually replace our physical Truck Bazaar events. We intend to utilize our Automall platform for marketing of our
financial products and develop new customers. We intend to commence operation of such "Automalls" during the first
quarter of 2011, and to gradually expand to between 50 and 60 Automalls in the next 12 to 15 months.

Diversify our product portfolio

We intend to further develop our equipment finance business, particularly construction equipment. We believe that
infrastructure development and construction businesses are likely to benefit from the significant investment in
infrastructure by the Government of India and state governments and as well as by the private sector. Many of our FTU
and SRTO customers are increasingly entering the construction equipment business, and we believe that the construction
equipment business segment will be a logical extension of our product portfolio for our existing customer base. We
believe that the construction equipment finance segment provides significant growth opportunity and intend to
increasingly focus on construction equipment finance as a distinct business segment through our wholly-owned
subsidiary Shriram Equipment Finance Company Limited. We are in the process of recruiting senior management and
other personnel for this business segment.

We are focused on leveraging our leadership in truck financing to expand our product portfolio, which now also includes
financing for passenger commercial vehicles, multi-utility vehicles, three-wheelers, tractors, and construction equipment.
We expect this will enable us to offer new products to existing customers and expand our customer base. These products
- 49 -
have strong synergies with the truck financing sector which is our primary business line. Further, by offering additional
downstream products, such as vehicle parts and other ancillary loans, credit cards and freight bill discounting, we
maintain contact with the customer throughout the product lifecycle and increase our revenues. The relationships we
have developed with our customers provide us with opportunities for repeat business and to cross sell our other products
and products of our affiliates.

Continue to implement advanced processes and systems

We have invested in our technology systems and processes to create a stronger organization and ensure good
management of customer credit quality. Our information technology strategy is designed to increase our operational and
managerial efficiency. We aim to increasingly use technology in streamlining our credit approval, administration and
monitoring processes to meet customer requirements on a real-time basis. We continue to implement technology led
processing systems to make our appraisal and collection processes more efficient, facilitate rapid delivery of credit to our
customers and augment the benefits of our relationship based approach. We also believe deploying strong technology
systems that will enable us to respond to market opportunities and challenges swiftly, improve the quality of services to
our customers, and improve our risk management capabilities.

- 50 -
 THE ISSUE
The following is a summary of the Issue. This summary should be read in conjunction with, and is qualified in its
entirety by, more detailed information in the chapter titled “Terms of the Issue” beginning on page 161 of this
Prospectus.
Common Terms of NCDs
Issuer Shriram Transport Finance Company Limited
Issue Public Issue by our Company of NCDs aggregating upto Rs. 25,000 lacs with an option
to retain over-subscription upto Rs. 25,000 lacs for issuance of additional NCDs
aggregating to a total of upto Rs.50,000 lacs, including a reservation for Unsecured
NCDs aggregating upto Rs. 20,000 lacs. The Unsecured NCDs will be in the nature of
subordinated debt and will be eligible for Tier II capital.*
Stock Exchanges proposed
NSE
for listing of the NCDs
Issuance and Trading Compulsorily in dematerialised form
Trading Lot 1 (one) NCD
Depositories NSDL and CDSL
Security Security for the purpose of this Issue will be created in accordance with the terms of
the Debenture Trust Deed. For further details please refer to the section titled “Issue
Structure” beginning on page 165 of this Prospectus. Please note that no security will
be created in connection with the Unsecured NCDs.
Rating The Secured NCDs proposed to be issued under this Issue have been rated ‘CARE
AA+’ by CARE for an amount of upto Rs. 50,000 Lacs and ‘AA/Stable’ by CRISIL
for an amount of upto Rs. 50,000 Lacs vide their letters dated April 19, 2010 and
April 27, 2010, respectively and the Unsecured NCDs proposed to be issued under
this Issue have been rated ‘CARE AA’ by CARE for an amount of upto Rs. 50,000
Lacs and ‘AA/Stable’ by CRISIL for an amount of upto Rs. 50,000 Lacs vide their
letters dated April 19, 2010 and April 27, 2010, respectively.
Issue Schedule ∗∗ The Issue shall be open from May 17, 2010 to May 31, 2010 with an option to close
earlier and/or extend upto a period as may be determined by our Board.
3 (three) Business Days from the date of reciept of application or the date of
Pay-in date realisation of the cheques/demand drafts, whichever is later.
Deemed Date of Allotment Deemed date of allotment shall be the date of issue of the Allotment Advice / regret.
*Note:
Our Company shall be entitled to issue and allot Secured NCDs, subject Illustrations:
to demand, aggregating upto the Issue Size i.e. upto Rs. 50,000 lacs, in
case of a shortfall in demand for Unsecured NCDs. • In case of NIL demand for Unsecured NCD, our Company
shall be entitled to issue Secured NCDs aggregating upto Rs.
50,000 lacs, provided that our Company recieves adequate
demand for such Secured NCDs.

• In case our Company receives a demand for Unsecured NCDs

aggregating to Rs. 10,000 lacs, our Company shall be entitled
to issue Secured NCDs aggregating upto Rs. 40,000 lacs,
provided that our Company recieves adequate demand for
such Secured NCDs.

Alternatively, our Company shall be entitled to issue and allot Unsecured
NCDs, subject to demand, aggregating upto the Issue Size i.e. upto Rs.
50,000 lacs, in case of a shortfall in demand for Secured NCDs.
Illustrations:
• In case of NIL demand for Secured NCDs, our Company shall
be entitled to issue Unsecured NCDs aggregating upto Rs.
50,000 lacs, provided that our Company recieves adequate
demand for such Unsecured NCDs.

• In case our Company receives a demand for Secured NCDs

aggregating to Rs. 10,000 lacs, our Company shall be entitled
to issue Unsecured NCDs aggregating upto Rs. 40,000 lacs,
provided that our Company recieves adequate demand for
such Unsecured NCDs.
**The subscription list shall remain open for a period as indicated, with an option for early closure or extension by such period, upto a period of 30
days from date of opening of the Issue, as may be decided by the Board of Directors of our Company.
- 51 -
The specific terms of each instrument are set out below:
TERMS AND CONDITIONS IN CONNECTION WITH THE SECURED NCDs
Nature of the Secured NCDs
We are offering Secured NCDs which shall have a fixed rate of interest. The Secured NCDs will be issued at a face
value of Rs. 1,000/- per Secured NCD. Interest on the Secured NCDs shall be payable on semi-annual or on an
annual basis, as the case may be, as set out hereinafter. The terms of the Secured NCDs offered pursuant to the
Issue are as follows:

Options I II III
Frequency of Interest Annual Semi-Annual Annual
Payment
Minimum Application Rs. 10,000 Rs. 10,000 Rs. 10,000
Or
Rs. 10,000/- (10 NCDs) (for all options of Secured NCDs and Unsecured
NCDs, namely Options I, II, III, IV, and V either taken individually or
collectively)
In Multiples of Rs. 1,000 Rs. 1,000 Rs. 1,000
Face Value of NCDs Rs. 1,000 Rs. 1,000 Rs. 1,000
(Rs. / NCD)
Issue Price (Rs. / NCD) Rs. 1,000 Rs. 1,000 Rs. 1,000
Mode of Interest Through Various Through Various Through Various
Payment options available options available options available
Coupon (%) p.a.** 9.00% per annum 9.50% per annum 9.75% per annum

Effective Yield (per For Secured NCD
annum) ** holders in the Reserved
Individual Portion –
9.75%
For Secured NCD
holders in the
Unreserved Individual
Portion – 9.50%
For all other Secured
NCD holders – 9.00%
Put and call option Exercisable at the end of
36 months from the
Deemed Date of
Allotment
Tenor 60 months
Redemption Date 60 months from the
Deemed Date of
Allotment. *
For Secured NCD For Secured NCD
holders in the Reserved holders in the Reserved
Individual Portion – Individual Portion –
10.51% 10.50%
For Secured NCD For Secured NCD
holders in the holders in the
Unreserved Individual Unreserved Individual
Portion – 10.25% Portion – 10.25%
For all other Secured For all other Secured
NCD holders – 9.73% NCD holders – 9.75%
Exercisable at the end of N/A
60 months from the
Deemed Date of
Allotment
84 months 60 months
84 months from the 60 months from the
Deemed Date of Deemed Date of
Allotment. * Allotment.

Redemption Amount Repayment of the Face
(Rs./NCD) Value plus any interest
that may have accrued at
the Redemption Date, or
at the date of early
redemption if any Put
Option or Call Option is
exercised, as the case
may be. *
Repayment of the Face Re-payment of the Face
Value plus any interest Value of the NCDs in
that may have accrued at stages between the
the Redemption Date, or period commencing on
at the date of early the expiry of 36 months
redemption if any Put till Redemption Date,
Option or Call Option is with 40% of the Face
exercised, as the case Value of the NCDs
may be.* payable at the end of the
36 months from the
Deemed Date of
- 52 -
Options I II III
Allotment, 40% of the
Face Value of the
NCDs, payable at the
end of 48 months from
the Deemed Date of
Allotment and 20% of
the Face Value of the
NCDs payable at the
end of 60 months from
the Deemed Date of
Allotment. The Face
Value at each stage of
redemption as detailed
above, shall be payable
together with any
interest which may have
accrued on the date of
such redemption.
Nature of Indebtedness Pari Passu with other Pari Passu with other Pari Passu with other
secured creditors and secured creditors and secured creditors and
priority over unsecured priority over unsecured priority over unsecured
creditors creditors creditors
Credit Rating

CARE: CARE AA+ for an CARE AA+ for an CARE AA+ for an
amount of upto Rs. amount of upto Rs. amount of upto Rs.
50,000 Lacs 50,000 Lacs 50,000 Lacs

CRISIL: ‘AA/Stable’ for an ‘AA/Stable’ for an ‘AA/Stable’ for an

amount of upto Rs. amount of upto Rs. amount of upto Rs.
50,000 Lacs 50,000 Lacs 50,000 Lacs
* Subject to exercise of put/call option.
** Option I, II and III Secured NCD holders in the Reserved Individual Portion shall be entitled to an additional interest
rate of 0.75% per annum, (“Reserved Individual Interest Rate”). Option I, II and III Secured NCD holders in the
Unreserved Individual Portion shall be entitled to an additional interest rate of 0.50% per annum, (“Unreserved
Individual Interest Rate”). Subject the the terms of this Prospectus, in addition, Senior Citizens in the Reserved Individual
Portion holding Option I, II and III Secured NCDs shall be entitled to an additional interest rate of 0.25% per annum over
and above the Reserved Individual Interest Rate.

TERMS AND CONDITIONS IN CONNECTION WITH THE UNSECURED NCDs

Nature of Unsecured NCDs
We are offering Unsecured NCDs which will be issued at a face value of Rs. 1,000/- per Unsecured NCD. Interest
on the Option V Unsecured NCDs shall be payable on an annual basis, and there shall be no interest payable on the
Option IV Unsecured NCDs, as set out hereinafter. The Option IV Unsecured NCDs, however shall be redeemable
at a premium of Rs. 1,000 per Option IV Unsecured NCD at the end of its tenor. The terms of the Unsecured NCDs
offered pursuant to the Issue are as follows:
Options IV V
Name Double Bond
Frequency of Interest Payment Not Applicable Annual
Minimum Application Rs. 10,000 Rs. 10,000
Or
Rs. 10,000/- (10 NCDs) (for all options of Secured NCDs and
Unsecured NCDs, namely Options I, II, III, IV, and V either taken

- 53 -
Options IV V
Name Double Bond
individually or collectively)
In Multiples of Rs. 1,000 Rs. 1,000
Face Value of NCDs Rs. 1,000 Rs. 1,000
(Rs. / NCD)
Issue Price (Rs. / NCD) Rs. 1,000 Rs. 1,000
Mode of Interest Payment Not Applicable Through Various options
available
Coupon (%) p.a. Not Applicable 10.25% per annum **

Effective Yield (per annum) For Unsecured NCD holders in For Unsecured NCD holders in
the Reserved Individual Portion – the Reserved Individual Portion –
11.25% 11.00%
For Unsecured NCD holders in For Unsecured NCD holders in
the Unreserved Individual Portion the Unreserved Individual Portion
– 10.81% – 10.75%
For all other Unsecured NCD For all other Unsecured NCD
holders – 10.41% holders – 10.25%**
Put and call option N/A N/A
Tenor For Unsecured NCD holders in 84 months
the Reserved Individual Portion –
78 months
For Unsecured NCD holders in
the Unreserved Individual Portion
– 81 months
For all other Unsecured NCD
holders – 84 months
Redemption Date For Unsecured NCD holders in 84 months from the Deemed Date
the Reserved Individual Portion – of Allotment
78 months from the Deemed Date
of Allotment
For Unsecured NCD holders in
the Unreserved Individual Portion
– 81 months from the Deemed
Date of Allotment
For all other Unsecured NCD
holders – 84 months from the
Deemed Date of Allotment
Redemption Amount Repayment of the Face Value Repayment of the Face Value
(Rs./NCD) plus a premium of Rs. 1,000 plus any interest that may have
accrued
Nature of Indebtedness Subordinated debt and will be Subordinated debt and will be
eligible for Tier II capital. eligible for Tier II capital.
Credit Rating

CARE: CARE AA for an amount of upto CARE AA for an amount of upto

Rs. 50,000 Lacs Rs. 50,000 Lacs
CRISIL: AA/Stable for an amount of upto AA/Stable for an amount of upto
Rs. 50,000 Lacs Rs. 50,000 Lacs
** Option V Unsecured NCD holders in the Reserved Individual Portion shall be entitled to an additional interest rate of
0.75% per annum. Option V Unsecured NCD holders in the Unreserved Individual Portion shall be entitled to an
additional interest rate of 0.50% per annum.

- 54 -
 SUMMARY FINANCIAL INFORMATION

The following tables present an extract of Reformatted Summary Financial Statements of our Company. The
Reformatted Summary Financial Statements should be read in conjunction with the examination report thereon issued by
our Statutory Auditors and statement of significant accounting policies and notes to accounts on the Reformatted
Summary Financial Statements contained in the section titled “Financial Information” beginning on page 142 of this
Prospectus.

Summary of unconsolidated Assets and Liabilities

(Rs. in lacs)
As at
As at
Particulars December As at March 31,
March 31,
31,
2010 2009 2009 2008 2007 2006 2005

Assets

A Fixed and Intangible

Assets (Net) (including
CWIP) 4,644.51 4,899.34 13,426.57 14,264.44 16,746.53 15,722.12 4,912.41

B Investments 185,601.67 125,493.97 65,476.33 138,512.02 22,457.16 915.42 407.49

C Deferred Tax Asset

(Net) 7,472.13 5,404.50 2,639.48 - - - -

D Current Assets 2,255,253.32 2,662,392.95 2,378,100.16 1,654,704.81 1,023,399.87 572,319.69 181,788.15

E Other loans &

Advances 240,963.09 66,503.40 40,306.00 19,422.18 20,946.78 17,945.76 9,458.96

F Total (A+B+C+D+E) 2,693,934.72 2,864,694.16 2,499,948.54 1,826,903.45 1,083,550.34 606,902.99 196,567.01

Liabilities

G Secured Loans 1,517,248.07 1,914,975.11 1,677,459.31 1,154,494.87 630,015.59 374,201.79 129,998.95

H Unsecured Loans 328,742.89 340,637.49 334,671.85 322,807.83 239,495.26 65,279.01 16,115.93

I Deferred Tax Liability

(Net) - - - 3,592.21 8,661.98 13,368.85 5,349.98

J Current Liabilities 390,860.61 249,733.73 212,883.25 137,321.90 81,445.50 61,279.78 20,189.65

K Provisions 76,553.32 53,383.85 43,270.53 27,050.74 15,304.49 8,924.98 2,611.34

L Total (G+H+I+J+K) 2,313,404.89 2,558,730.18 2,268,284.94 1,645,267.55 974,922.82 523,054.41 174,265.85

M Net Worth (F-L) 380,529.83 305,963.98 231,663.60 181,635.90 108,627.52 83,848.58 22,301.16

Represented By
- 55 -
 (Rs. in lacs)
As at
As at
Particulars December As at March 31,
March 31,
31,
2010 2009 2009 2008 2007 2006 2005
(i) Share Capital 22,554.18 21,279.86 20,353.56 20,315.94 18,418.27 16,921.05 9,073.50
(ii) Share application
money pending
allotment 5.22 12.97 13.80 21.37 - - -
(iii) Stock Option
Outstanding 757.02 1,497.93 2,138.90 1,826.64 1,227.38 353.49 -
(iv) Optionally Convertible
warrants - - 2,400.00 2,400.00 772.80 1,992.03 103.81
(v) Reserves and Surplus 360,922.10 286,716.43 206,757.34 157,071.95 88,222.80 64,623.18 13,168.28
(vi) Less : Miscellaneous
Expenditure (to
the extent not written
off or adjusted) 3,708.69 3,543.21 - - 13.73 41.17 44.43
Total (i+ii+iii+iv+v-vi) 380,529.83 305,963.98 231,663.60 181,635.90 108,627.52 83,848.58 22,301.16

- 56 -
 Summary of unconsolidated Profit and Loss Account

(Rs. in lacs)
For the For the
year period
ended April 01, For the year ended March 31,
Particulars
March 2009 to
31, 2010 December
31, 2009 2009 2008 2007 2006 2005

A. Income

i Income from Operations 440,282.74 320,857.46 365,918.77 245,328.68 140,299.54 88,534.58 33,831.76

ii Other Income 9,681.08 6,181.88 7,194.20 5,574.00 1,839.06 2,095.93 737.08

Total Income 449,963.82 327,039.34 373,112.97 250,902.68 142,138.60 90,630.51 34,568.84

B. Expenditure

i Interest & Other Charges 224,678.93 167,377.84 197,767.21 129,661.64 73,833.11 41,913.24 16,561.34
ii Raw Material Consumed - - 687.17 258.06 - - -
iii Personnel Expenses 22,508.15 16,396.29 20,053.60 12,547.76 7,263.39 4,776.62 1,421.88
iv Operating & Other Expenses 27,258.22 19,637.47 27,925.50 19,463.22 13,788.10 13,162.37 6,078.91
v Depreciation and 1,495.84 1,196.22 3,480.59 3,705.97 1,281.85 969.02 352.03
amortisation
vi Impairment loss/(Reversal)
on Fixed assets & stock - - 560.87 - (296.72) 9.97 119.63
viii Share & Debenture Issue
expenses written off 498.70 394.28 - 13.74 27.44 39.35 22.85
viii Provisions & Write offs (net) 41,064.86 30,842.97 30,574.92 24,668.99 17,319.01 8,143.07 2,225.31

Total Expenditure 317,504.70 235,845.07 281,049.86 190,319.38 113,216.18 69,013.64 26,781.95

C. Net Profit Before Taxation

(A-B) 132,459.12 91,194.27 92,063.11 60,583.30 28,922.42 21,616.87 7,786.89

D. Provision for taxation

Current tax 49,980.03 33,090.61 34,998.86 26,387.42 14,445.62 5,984.29 1,464.23

Deferred tax (4,832.65) (2,765.02) (4,477.15) (5,069.77) (4,706.87) 1,345.26 1,390.28
Fringe Benefit Tax - - 301.19 283.00 143.96 123.22 -

Total Tax 45,147.38 30,325.59 30,822.90 21,600.65 9,882.71 7,452.77 2,854.51

E. Net Profit after Taxation

(C-D) 87,311.74 60,868.68 61,240.21 38,982.65 19,039.71 14,164.10 4,932.38

Balance in Profit & Loss

Account brought forward 58,309.25 58,309.25 27,486.21 12,248.92 5,322.65 3,396.32 1,914.29
on amalgamation of SIL - - - - - 3,387.15 -
on amalgamation of
SOFL - - - - - 106.96 -

- 57 -
 (Rs. in lacs)
For the For the
year period
ended April 01, For the year ended March 31,
Particulars
March 2009 to
31, 2010 December
31, 2009 2009 2008 2007 2006 2005

Provision for Dividend no - - - - - - 4.76

longer required

F. Balance Available for

Appropriations 145,620.99 119,177.93 88,726.42 51,231.57 24,362.36 21,054.53 6,851.43

G. Appropriations

Dividend - Cumulative
Redeemable Preference
Shares - - - - - 423.67 228.21
Equity Shares - Interim 519.50
dividend 4,254.76 4,254.76 2,035.03 2,031.35 1,749.01 4,271.43
Equity Shares - Final
dividend 325.18 325.18 10.52 138.85 - - -
Equity Shares - Proposed
final dividend 9,020.71 - 8,140.46 8,125.42 3,683.17 559.38 981.43
Tax on dividend 2,276.61 778.36 1,731.16 1,749.74 871.26 736.95 225.97
Short Provision for
Dividend Tax of previous
Year - - - - - 18.09 -
Transfer to statutory reserve 17,500.00 - 12,300.00 7,800.00 3,810.00 2,834.01 1,000.00
Transfer to general reserve 8,800.00 - 6,200.00 3,900.00 2,000.00 1,500.00 500.00
Transfer to Capital
Redemption Reserve - - - - - 5,388.35 -
Transfer to debenture
redemption reserve 10,442.08 6,802.27 - - - - -

Total Appropriations 52,619.34 12,160.57 30,417.17 23,745.36 12,113.44 15,731.88 3,455.11

H. Balance carried to Balance

Sheet (F-G) 93,001.65 107,017.36 58,309.25 27,486.21 12,248.92 5,322.65 3,396.32

- 58 -
 Summary of Unconsolidated Cash Flow Statement

(Rs in lacs)
For the year For the year ended March 31,
For the period
ended 2009 2008 2007 2006 2005
April 01, 2009
Particulars March 31, to December
2010 31, 2009

A. Cash flow from operating

activities
Net profit before taxation 132,459.12 91,194.27 92,063.11 60,583.30 28,922.42 21,616.87 7,786.89
Depreciation and amortisation 1,495.84 1,215.26 3,480.59 3,705.97 1,281.85 969.02 352.03
Issue expenses for equity
shares 25.28 - - - - - -
Public issue expenses for non
convertible debentures 473.42 394.28 - - - - -
Share and debenture issue
expenses written off - - - 13.74 27.44 39.35 22.85
(Profit) / loss on sale of fixed
assets (net) (62.40) (88.78) 87.77 17.39 231.02 33.00 7.63
(Profit) / loss on sale of current
and long term investments (net) (1,812.65) (822.32) (512.61) (717.70) (11.65) (19.06) (6.84)
Interest income on current and
long term investments and
interest income on fixed
deposits (3,178.28) (1,574.91) (2,767.69) (2,967.86) (398.96) (347.78) (121.07)
Dividend income (874.71) (874.71) (486.91) (519.33) (20.84) (2.13) (0.06)
Employees Stock option
compensation cost 341.30 292.00 580.57 653.95 987.16 353.49 -
Provision for impairment of
windmill - - 560.87 - (248.28) - 70.15
Provision for impairment -
others - - - - (48.44) 9.97 49.48
Provision for hedging contracts - - (705.44) 690.42 15.02 - -
Provision for credit loss on
securitisation 7,971.84 3,317.30 4,464.01 2,009.30 1,640.19 - -
Provisions for non performing
assets and bad debts written off
33,622.02 27,901.02 26,794.90 21,875.36 15,742.63 8,322.05 2,217.12
Provision for gratuity 148.71 119.91 141.16 148.45 22.92 19.67 6.40
Provision for leave encashment 146.44 119.59 227.65 120.73 (0.82) 12.50 5.00
Provision for diminution in
value of investments 20.34 21.67 81.14 60.67 (167.60) 11.79 19.85
Operating profit before
working capital changes 170,776.27 121,214.58 124,009.12 85,674.39 47,974.06 31,018.74 10,409.43
Movements in working
capital:
(Increase) / decrease in
current assets:
(Increase) / decrease in
inventories 126.81 126.81 (60.28) (66.53) - - -
(Increase) / decrease in Assets
under financing activities (19,813.77) (372,426.81) (294,777.86) (692,459.86) (308,228.67) (248,606.35) (68,774.96)
(Increase) / decrease in sundry
debtors 399.24 399.24 (151.13) 100.56 402.91 (556.59) -
(Increase) / decrease in lease
assets - net of sales - - - - 0.56 1.16 5.77
Increase) / decrease in other
current assets (1,008.93) (58,380.86) (835.19) (1,686.67) (476.78) - -
- 59 -
 (Rs in lacs)
For the year For the year ended March 31,
For the period
ended 2009 2008 2007 2006 2005
April 01, 2009
Particulars March 31, to December
2010 31, 2009

(Increase) / decrease in other

loans and advances (201,034.75) (26,199.89) (22,878.25) 1,776.17 (3,384.80) 5,980.88 (64.36)
Increase / (decrease) in current
liabilities 185,950.33 38,542.14 74,207.62 57,180.20 22,326.43 18,306.00 6,437.64
Cash generated from
operations 135,395.20 (296,724.79) (120,485.97) (549,481.74) (241,386.29) (193,856.16) (51,986.48)
Direct taxes paid (net of
refunds) (48,629.16) (33,095.56) (35,067.48) (26,899.61) (14,205.81) (6,480.97) (1,832.63)
Net cash used in operating
activities (A) 86,766.04 (329,820.35) (155,553.45) (576,381.35) (255,592.10) (200,337.13) (53,819.11)

B. Cash flows from investing

activities
Investment in Fixed deposits
(net) (88,988.21) (62,129.42) (47,214.27) (33,178.65) (32,445.92) 9,179.84 (1,331.52)
Purchase of fixed assets and
intangible assets (624.86) (544.02) (3,369.47) (5,252.92) (1,622.25) (1,075.00) (127.29)
Change in capital work in
progress(fixed and intangible
assets) - - - 3,986.91 (1,414.06) (2,244.05) (4.05)
Proceeds from sale of fixed
assets 7,973.48 7,944.77 78.10 24.70 746.91 302.00 2.41
Purchase of Investment (2,501,835.74) (1,418,400.94) (64,790.83) (776,661.44) (21,364.74) - -
Investment in associate
company - - - (30.00) (180.00) - -
Investment in subsidiary
company (220.00) (214.99) - - (4.99) - -
Proceeds from sale of
investment in subsidiary
company 5.00 5.00 - 4.99 - - -
Proceeds from sale of
investment in associate
company - - - 112.50 - - -
Proceeds from sale of
investments 2,383,738.05 1,359,415.61 138,339.14 661,221.69 19.63 78.58 6.84
Interest received on current and
long term investments and
interest on fixed deposits 2,896.30 2,025.23 2,825.79 2,548.54 423.01 1,836.35 137.44
Dividend received 874.71 874.71 486.91 519.33 20.84 2.13 0.06
Net cash used in investing
activities (B) (196,181.27) (111,024.05) 26,355.37 (146,704.35) (55,821.57) 8,079.85 (1,316.11)

C. Cash Flows from

financing activities
Proceeds from issue of equity
share capital including
securities premium & Share
application 80,799.14 22,041.21 124.09 43,003.42 11,028.07 30,687.67 6,107.40
Redemption of preference
shares - - - (5,388.35) -
Proceeds from issue of share
warrants - 2,400.00 - 1,792.00 103.81
Increase / (decrease) in bank
borrowings (net) (110,368.28) 219,120.27 320,120.96 443,172.48 278,640.26 116,255.06 18,849.14

- 60 -
 (Rs in lacs)
For the year For the year ended March 31,
For the period
ended 2009 2008 2007 2006 2005
April 01, 2009
Particulars March 31, to December
2010 31, 2009

Increase / (decrease) in long

term borrowings from others
(net) (68,604.27) (40,515.12) (41,471.04) 27,824.90 85,438.50 18,041.38 12,430.57
Increase / (decrease) in fixed
deposits (net) 10,991.06 7,802.15 146.45 (763.73) (342.36) (1,325.98) (219.51)
Increase / (decrease) in
subordinate debts (net) 51,823.24 36,906.16 55,816.44 30,577.18 29,924.71 13,225.78 9,401.10
Increase / (decrease) in
redeemable non convertible
debentures (net) 408.53 70,550.19 169,124.14 119,111.61 2,368.94 10,126.91 14,433.61
Increase / (decrease) in inter
corporate deposits and
commercial papers (net) (50,390.48) (50,382.21) 31,091.52 (12,214.36) 34,000.00 (331.71) (15.00)
Issue expenses for equity
shares paid (1,415.53) - - - - - -
Public issue expenses for non
convertible debentures paid (2,690.64) (3,937.49) - - - - -
Dividend paid (12,720.40) (12,720.40) (10,170.96) (5,853.38) (5,320.67) (3,575.25) (1,528.17)
Tax on dividend (2,161.83) (2,161.83) (1,728.56) (994.78) (746.23) (519.52) (198.32)
Net cash from financing
activities (C) (104,329.46) 246,702.93 523,053.04 646,263.34 434,991.22 178,987.99 59,364.63
Net increase / (decrease) in
cash and cash equivalents (A
+ B + C) (213,744.69) (194,141.47) 393,854.96 (76,822.36) 123,577.55 (13,269.29) 4,229.41
Cash and Cash Equivalents
at the beginning of the year
*
461,054.26 461,054.26 67,199.30 144,021.66 20,444.11 33,713.40 13,420.96
Cash and Cash Equivalents
at the end of the year 247,309.57 266,912.79 461,054.26 67,199.30 144,021.66 20,444.11 17,650.37
Components of Cash and
Cash Equivalent
Cash on hand 7,818.91 2,469.68 7,062.48 5,639.48 2,281.08 1,756.21 563.37
Cheques on hand 2,220.79 2,614.89 1,490.15 856.52 215.76 54.65 80.15
Remittances in transit 9.48 144.00 10.16 193.69 2,375.05 829.39 66.20
With Banks - in Current
Account 166,008.69 163,186.32 95,601.30 45,275.37 26,253.34 15,584.83 16,800.73
- in unpaid dividend accounts
$ 274.83 294.26 165.70 109.36 160.05 125.48 139.92
-in fixed deposits (Original
maturity being three months
or less) 70,976.87 98,203.64 356,724.47 15,124.88 112,736.38 2,093.55 -
247,309.57 266,912.79 461,054.26 67,199.30 144,021.66 20,444.11 17,650.37
Note:
* Cash and Cash Equivalents at the beginning of the year for the year 2006 includes cash and cash equivalents of M/s. Shriram
Investments Limited Rs. 15,792.04 Lacs and of M/s Shriram Overseas Finance Limited Rs. 270.99 Lacs. The same is not
included in Cash and cash equivalents at the end of the year 2005.
$ These balances are not available for use by the Company as they represent corresponding unpaid dividend liability.

- 61 -
Consolidated Summary of Assets and Liabilities

(Rs. in lacs)

As at March As at December
Particulars
31, 2010 31, 2009

Assets

A Fixed and Intangible Assets (Net) (including 4,649.06 4,899.34

CWIP)

B Investments 185,561.94 125,460.67

C Deferred Tax Asset (Net) 7,472.94 5,404.50

D Current Assets 2,255,469.18 2,662,603.05

E Other Loans & Advances 240,958.07 66,500.77

F Total (A+B+C+D+E) 2,694,111.19 2,864,868.33

Liabilities

G Secured Loans 1,517,248.07 1,914,975.11

H Unsecured Loans 328,742.89 340,637.49

I Current Liabilities 390,863.52 249,734.00

J Provisions 76,553.35 53,383.85

K Minority Interest - 0.01

L Total (G+H+I+J+K) 2,313,407.83 2,558,730.46

M Net Worth (F-L) 380,703.36 306,137.87

Represented By
(i) Share Capital 22,554.18 21,279.86
(ii) Share application money pending allotment 5.22 12.97
(iii) Stock Option Outstanding 757.02 1,497.93
(iv) Reserves and Surplus 361,095.63 286,890.32
(v) Less : Miscellaneous Expenditure (to the extent 3,708.69 3,543.21
not written off or adjusted)
Total (i+ii+iii+iv-v) 380,703.36 306,137.87

- 62 -
Consolidated Summary of Profit and Loss Account

(Rs. in lacs)

For the year ended For the period April 01,

Particulars March 31, 2010 2009 to December 31,
2009

A Income

i Income from Operations 440,282.74 320,857.46

ii Other Income 9,685.90 6,185.46

Total Income (A+B) 449,968.64 327,042.92

B Expenditure

i Interest & Other Charges 224,678.93 167,377.84

ii Personnel Expenses 22,508.15 16,396.29
iii Operating & Other Expenses 27,258.49 19,637.47
iv Depreciation and amortisation 1,495.84 1,196.22
v Share & Debenture Issue expenses written off 505.63 400.66
vi Provisions & Write offs (net) 41,064.86 30,842.97

Total Expenditure 317,511.90 235,851.45

C. Net Profit Before Taxation (A-B) 132,456.74 91,191.47

D. Provision for taxation

Current tax 49,980.20 33,090.61

Deferred tax (4,833.46) (2,765.02)
Total Tax 45,146.74 30,325.59

E. Net Profit after Taxation (C-D) 87,310.00 60,865.88

Share of Losses of Associate
(7.44) (6.02)
F Profit after taxes, Minority Interest and
Share of Loss of Associate 87,302.56 60,859.86
Balance in Profit & Loss Account brought
forward 58,309.25 58,309.25

G Balance Available for Appropriations

145,611.81 119,169.11

H Appropriations

Equity Shares - Interim dividend 4,254.76 4,254.76

- 63 -
 (Rs. in lacs)

For the year ended For the period April 01,

Particulars March 31, 2010 2009 to December 31,
2009

Equity Shares - Final dividend 325.18 325.18

Equity Shares - Proposed final dividend 9,020.71 -

Tax on dividend 778.36 778.36

Tax on proposed dividend 1,498.25 -

Transfer to statutory reserve 17,500.00 -

Transfer to general reserve 8,800.00 -

Transfer to debenture redemption reserve 10,442.08 6,802.27

Total Appropriations
52,619.34 12,160.57

I Balance carried to Balance Sheet (G-H) 92,992.47 107,008.54

- 64 -
Summary of Consolidated Cash Flow Statement
(Rs in lacs)

For the year ended March For the period April 01, 2009 to
Particulars
31, 2010 December 31, 2009

A. Cash flow from operating activities

Net profit before taxation 132,456.74 91,191.47

Depreciation and amortisation 1,495.84 1,215.26

Issue expenses for equity shares 25.28 -

Public issue expenses for non convertible
debentures 473.42 394.28

(Profit) / loss on sale of fixed assets (net) (62.40) (88.78)

(Profit) / loss on sale of current and long term
investments (net) (1,812.65) (822.32)
Interest income on current and long term
investments and interest income on fixed deposits (3,179.95) (1,575.34)
Dividend income (874.71) (874.71)

Employees Stock option compensation cost 341.30 292.00

Provision for credit loss on securitisation 7,971.84 3,317.30

Provisions for non performing assets and bad
debts written off 33,622.02 27,901.02

Provision for gratuity 148.71 119.91

Provision for leave encashment 146.44 119.59

Provision for diminution in value of investments 20.34 21.67

Operating profit before working capital 170,772.22 121,211.35
changes
Movements in working capital:
(Increase) / decrease in current assets:
(Increase) / decrease in inventories 126.81 126.81
(Increase) / decrease in assets under financing
activities (19,813.77) (372,426.81)

(Increase) / decrease in sundry debtors 399.24 399.24

(Increase) / decrease in other current assets (1,008.93) (58,380.86)

(Increase) / decrease in other loans and advances (201,029.73) (26,197.25)

Increase / (decrease) in current liabilities 185,952.24 38,542.41
Cash generated from operations 135,398.08 (296,725.11)

Direct taxes paid (net of refunds) (48,629.30) (33,095.56)

Net cash used in operating activities (A) 86,768.78 (329,820.67)

- 65 -
Summary of Consolidated Cash Flow Statement
(Rs in lacs)

For the year ended March For the period April 01, 2009 to
Particulars
31, 2010 December 31, 2009

B. Cash flows from investing activities

Investment in Fixed deposits (net) (88,988.21) (62,129.42)

Purchase of fixed assets (629.41) (544.02)

Proceeds from sale of fixed assets 7,973.48 7,944.77

Purchase of Investment (2,501,835.74) (1,418,405.94)

Proceeds from sale of investments 2,383,738.05 1,359,420.61

Interest received on current and long term
investments and interest on fixed deposits 2,897.87 2,025.66
Dividend received 874.71 874.71

Net cash used in investing activities (B) (195,969.25) (110,813.63)

C. Cash Flows from financing activities

Proceeds from issue of equity share capital
including securities premium & Share application 80,799.14 22,041.21

Increase / (decrease) in bank borrowings (net) (110,368.29) 219,120.27

Increase / (decrease) in long term borrowings
from others (net) (68,604.27) (40,515.12)

Increase / (decrease) in fixed deposits (net) 10,991.07 7,802.15

Increase / (decrease) in subordinate debts (net) 51,823.24 36,906.16

Increase / (decrease) in redeemable non
convertible debentures (net) 408.53 70,550.19
Increase / (decrease) in inter corporate deposits
and commercial papers (net) (50,390.48) (50,382.21)

Issue expenses for equity shares paid (1,414.53) -

Public issue expenses for non convertible
debentures paid (2,690.64) (3,937.49)

Dividend paid (12,720.40) (12,720.40)

Tax on dividend (2,161.83) (2,161.83)

Net cash from financing activities (C) (104,328.46) 246,702.93

Net increase / (decrease) in cash and cash
equivalents (A + B + C) (213,528.93) (193,931.37)
Cash and Cash Equivalents at the beginning of
the year 461,054.26 461,054.26
Cash and Cash Equivalents at the end of the
year 247,525.33 267,122.89

- 66 -
Summary of Consolidated Cash Flow Statement
(Rs in lacs)

For the year ended March For the period April 01, 2009 to
Particulars
31, 2010 December 31, 2009

(Rs in lacs)
Components of Cash and Cash Equivalents As at March 31, 2010 As at December 31, 2009
Cash on hand 7,818.91 2,469.68
Cheques on hand 2,220.79 2,614.89
Remittances in transit 9.48 144.00
With Banks - in Current Account 166,023.34 163,196.32
- in unpaid dividend accounts $ 274.83 294.26
- in fixed deposits (Original maturity
being three months or less) 71,177.98 98,403.74

247,525.33 267,122.89

- 67 -
 CAPITAL STRUCTURE

Details of share capital

The share capital of our Company as at date of this Prospectus is set forth below:

Share Capital Rupees in Lacs

AUTHORISED SHARE CAPITAL
33,50,00,000 Equity Shares of Rs.10/- each 33,500
2,00,00,000 Preference Shares of Rs.100/- each 20,000

TOTAL 53,500

ISSUED
225,571,959 Equity Shares of Rs.10/- each 22,557.20

SUBSCRIBED
225,571,959 Equity Shares of Rs.10/- each 22,557.20

PAID-UP SHARE CAPITAL

225,517,818 Equity Shares of Rs. 10/- each 22,551.78
48,000 Equity Shares of Rs. 10/- each, paid up Rs. 5/- each 2.40

TOTAL 22,554.18
NOTES:
Of the total Equity shares an aggregate of 79,279,236 Equity Shares have been allotted for
consideration other than cash of which:

a. 60,633,350 fully paid-up Equity Shares of our Company have been allotted to the
shareholders of SIL, pursuant to a scheme of amalgamation sanctioned by the Hon’ble
High Court of Madras vide its order dated November 25, 2005, in a ratio of 1 fully paid up
Equity Share of our Company, for every 1 fully paid up equity share of the face value of
Rs. 10/- each, of SIL; and

b. 18,645,886 fully paid-up Equity Shares of our Company have been allotted to the
shareholders of SOFL, pursuant to a scheme of amalgamation sanctioned by the Hon’ble
High Court of Madras vide its order dated December 1, 2006, in a ratio of 3 fully paid up
Equity Shares of our Company, for every 5 fully paid up equity shares of the face value of
Rs. 10/- each, of SOFL

(i) Pursuant to the issuance of 6,495,420 Equity Shares on a rights basis on April 21, 1995,
6,484,910 Equity Shares were allotted, and 10,510 Equity Shares were kept in abeyance
and not allotted, on account of unavailability of certain information in connection with
certain applicants of Equity Shares in the said rights issue. Subsequently, 2,369 Equity
Shares and 2,000 Equity Shares of the aforementioned Equity Shares kept in abeyance,
were allotted on November 11, 1995 and December 28, 1995, respectively. Currently,
6,141 Equity Shares are still kept in abeyance and pending allotment.

(ii) 48,000 equity shares of Rs. 10/- each of SIL, on which Rs.5/- was paid up for each of the
said shares, were forfeited on January 17, 1997, (“Forfeited Shares”). Pursuant to the
scheme of amalgamation sanctioned by the Hon’ble High Court of Madras vide its order

- 68 -
Share Capital Rupees in Lacs
dated November 25, 2005, as detailed in para (a) above, the Forfeited Shares have become
a part of the share capital of our Company, by operation of law.

Changes in the authorised capital of our Company as on the date of this Prospectus:

Sr. FY Alteration
No.
1. 1983 The Authorised share capital of our Company was increased from Rs 10,00,000 divided into 1,00,000
Equity Shares to Rs 50,00,000 divided into 5,00,000 Equity Shares.
2. 1986 The Authorised share capital of our Company was increased from Rs 50,00,000 divided into 5,00,000
Equity Shares to Rs 1,00,00,000 divided into 10,00,000 Equity Shares.
3. 1989 The Authorised share capital of our Company was increased from Rs 1,00,00,000 divided into
10,00,000 Equity Shares to Rs 2,00,00,000 divided into 20,00,000 Equity Shares.
4. 1991 The Authorised share capital of our Company was increased from Rs 2,00,00,000 divided into
20,00,000 Equity Shares to Rs 6,50,00,000 divided into 65,00,000 Equity Shares.
5. 1995 The Authorised share capital of our Company was increased from Rs 6,50,00,000 divided into
65,00,000 Equity Shares to Rs 40,00,00,000 divided into 3,00,00,000 Equity Shares and 10,00,000
cumulative redeemable preference shares of Rs 100 each.
6. 1997 The Authorised share capital of our Company was increased from Rs 40,00,00,000 divided into
300,00,000 Equity Shares and 10,00,000 cumulative redeemable preference shares of Rs 100 each to
Rs 60,00,00,000 divided into 500,00,000 Equity Shares and 10,00,000 cumulative redeemable
preference shares of Rs 100 each.
7. 1998 The Authorised share capital of our Company was increased from Rs 60,00,00,000 divided into
500,00,000 Equity Shares and 10,00,000 cumulative redeemable preference shares of Rs 100 each to
Rs 65,00,00,000 divided into 500,00,000 Equity Shares and 15,00,000 cumulative redeemable
preference shares of Rs 100 each
8. 2000 The Authorised share capital of our Company was increased from Rs 65,00,00,000 divided into
500,00,000 Equity Shares and 15,00,000 cumulative redeemable preference shares of Rs 100 each to
Rs 90,00,00,000 divided into 500,00,000 Equity Shares and 40,00,000 cumulative redeemable
preference shares of Rs 100 each
9. 2003 The Authorised share capital of our Company was increased from Rs 90,00,00,000 divided into
500,00,000 Equity Shares and 40,00,000 cumulative redeemable preference shares of Rs 100 each to
Rs 1,15,00,00,000 divided into 7,50,00,000 Equity Shares each and 40,00,000 cumulative redeemable
preference shares of Rs 100 each
10. 2004 The Authorised share capital of our Company was increased from Rs 1,15,00,00,000 divided into
7,50,00,000 Equity Shares and 40,00,000 cumulative redeemable preference shares of Rs 100 each to
Rs 1,25,00,00,000 divided into 7,50,00,000 Equity Shares and 50,00,000 cumulative redeemable
preference shares of Rs 100 each.
11. 2004 The Authorised share capital of our Company was reorganised from Rs 1,25,00,00,000 divided into
7,50,00,000 Equity Shares and 50,00,000 cumulative redeemable preference shares of Rs 100 each to
1,25,00,00,000 divided into 7,50,00,000 Equity Shares and 50,00,000 preference shares of Rs 100
each.
12. 2006 The Authorised share capital of our Company was increased from Rs 1,25,00,00,000 divided into
7,50,00,000 Equity Shares and 50,00,000 preference shares of Rs 100 each to Rs 3,50,00,00,000
divided into 22,50,00,000 Equity Shares and 1,25,00,000 preference shares of Rs 100 each
13. 2006 The Authorised share capital of our Company was reorganised from Rs 3,50,00,00,000 divided into
22,50,00,000 Equity Shares and 1,25,00,000 preference shares of Rs 100 each to Rs 4,80,00,00,000
divided into 30,00,00,000 Equity Shares and 1,80,00,000 preference shares of Rs 100 each*
- 69 -
Sr. FY Alteration
No.
14. 2006 The Authorised share capital of our Company was reorganised from Rs 4,80,00,00,000 divided into
30,00,00,000 Equity Shares and 1,80,00,000 preference shares of Rs 100 each to Rs 5,35,00,00,000
divided into 33,50,00,000 Equity Shares and 2,00,00,000 preference shares of Rs 100 each**
NOTES:
* The authorised capital of our Company was increased pursuant to a scheme of amalgamation of the erstwhile SIL, with
our Company (“SIL Scheme of Merger”). The appointed date for the SIL Scheme of Merger was April 1, 2005 and the
record date for the purposes of re-organisation and issue of shares was December 21, 2005, as approved by the Hon’ble
High Court of Madras, vide its order dated November 25, 2005.

** The authorised capital of our Company was increased, pursuant to a scheme of amalgamation of the erstwhile SOFL,
with our Company (“SOFL Scheme of Merger”). The appointed date for the SOFL Scheme of Merger was April 1,
2005 and the record date for the purposes of re-organisation and issue of shares was February 9, 2007, as approved by
the Hon’ble High Court of Madras, vide its order dated December 1, 2006.

Equity Share Capital History of our Company

Date of Allotment Number of shares Cumulative Nature of Issue Issue Price Premium (Rs.)
issued and allotted Paid-up capital (Rs.)
in (Rs.)

December 30, 1979 50,000 5,00,000 Subscribers to the MOA 10/- N.A
and AOA

April 17, 1984 2,50,000 30,00,000 Public issue 10/- N.A

April 26, 1986 75,00,000 Rights issue 10/- N.A

4,50,000
(45,000 debentures
of Rs.100/- each)
March 31, 1989 5,75,000 1,32,50,000 Rights issue 10/- N.A

November 30, 1990 51,70,420 6,49,54,200 Public cum Rights Issue 10/- N.A
( 3,45,000
debentures of
Rs.150/- each)

April 21, 1995 64,84,910 12,98,03,300 Rights issue 10/- N.A

November 11, 1995 2,369 12,98,26,990 Issue out of shares kept in 10/- N.A
abeyance

December 28, 1995 2,000 12,98,46,990 Issue out of shares kept in 10/- N.A
abeyance
June 26, 1997 35,65,65,490 Public cum Rights Issue 10 /- N.A
2,26,71,850
( 45,34,370
debentures of
Rs.50/- each )
November 28, 2002 62,43,000 41,89,95,490 Preferential Issue 12 /- 2/-

- 70 -
Date of Allotment Number of shares Cumulative Nature of Issue Issue Price Premium (Rs.)
issued and allotted Paid-up capital (Rs.)
in (Rs.)

April 26, 2004 46,00,000 46,49,95,490 Preferential Issue 29.81/- 19.81/-

July 23, 2004 54,50,000 51,94,95,490 Preferential Issue 25.50/- 15.50/-

February 16, 2005 1,34,79,000 65,42,85,490 Preferential Issue 35/- 25/-

December 23, 2005 6,06,33,350 1,26,06,18,990 Merger of SIL with our For N.A.
Company considerati
on other
than cash
February 2, 2006 2,44,78,681 1,50,54,05,800 Preferential Issue 112/- 102/-

August 7, 2006 57,15,000 1,56,25,55,800 Conversion of warrants 35/- 25/-

issued on February 16,
2005 on preferential basis

January 23, 2007 59,250 1,56,31,48,300 ESOP$ 35/- 25/-

February 12, 2007 1,86,45,886 1,74,96,07,160 Merger of SOFL with our For N.A.
Company considerati
on other
than cash

March 27, 2007 79,300 1,75,04,00,160 ESOP$ 35/- 25/-

March 30, 2007 91,00,000 1,84,14,00,160 Conversion of warrants 112/- 102/-
issued on February 2, 2006
on preferential basis

March 30, 2007 18,700 1,84,15,87,160 ESOP$ 35/- 25/-

April 27, 2007 16,000 1,84,17,47,160 ESOP$ 35/- 25/-

June 30, 2007 19,500 1,84,19,42,160 ESOP$ 35/- 25/-

July 31, 2007 69,00,000 1,91,09,42,160 Conversion of warrants 112/- 102/-

issued on February 2, 2006
on preferential basis
August 10, 2007 7,000 1,91,10,12,160 ESOP$ 35/- 25/-

- 71 -
Date of Allotment Number of shares Cumulative Nature of Issue Issue Price Premium (Rs.)
issued and allotted Paid-up capital (Rs.)
in (Rs.)

October 13, 2007 34,200 1,91,13,54,160 ESOP$ 35/- 25/-

December 14, 2007 1,20,00,000 2,03,13,54,160 Preferential Issue 300/- 290/-

June 25, 2008 87,100 2,03,22,25,160 ESOP$ 35/- 25/-

July 14, 2008 81,150 2,03,30,36,660 ESOP$ 35/- 25/-

July 24, 2008 94,850 2,03,39,85,160 ESOP$ 35/- 25/-

September 19, 2008 74,600 2,03,47,31,160 ESOP$ 35/- 25/-

October 27, 2008 29,300 2,03,50,24,160 ESOP$ 35/- 25/-

December 10, 2008 9,200 2,03,51,16,160 ESOP$ 35/- 25/-

May 16, 2009 34,200 2,03,54,58,160 ESOP$ 35/- 25/-

June 12, 2009 80,00,000 2,11,54,58,160 Conversion of warrants 300/- 290/-

issued December 14, 2007
on preferential basis.
July 16, 2009 95,350 2,11,64,11,660 ESOP$ 35/- 25/-
$
November 10, 2009 10,96,750 2,12,73,79,160 ESOP 35/- 25/-
November 24, 2009 36,650 2,12,77,45,660 ESOP$ 35/- 25/-
January 28, 2010 11,658,552 2,24,43,31,180 Qualified Institutional
Placement 500.80/- 490.80/-
March 26, 2010 10,84,700 2,25,51,78,180 ESOP$ 35/- 25/-

Total 22,55,17,818

$ Equity Shares allotted to the employees of our Company as fully paid up under the Company’s Employees
Stock Option Scheme 2005 on exercise of vested options.

Notes:

1. 45,000 convertible debentures of face value of Rs.100/- each were issued on April 26, 1986. 15,000 of the
convertible debentures were converted into 1,50,000 Equity Shares on October 26, 1986, another 15,000 of the
convertible debentures were converted into 1,50,000 Equity Shares on October 26, 1987 and the remaining
15,000 of the convertible debentures were converted into 1,50,000 Equity Shares on October 26, 1988.

2. 3,45,000 convertible debentures of face value of Rs.150/- each, were issued on November 30, 1990. Pursuant
to the conversion of the debentures, 17,25,000 Equity Shares have been allotted on June 1, 1991, 17,25,000
Equity Shares have been allotted on March 1, 1992 and 17,20,420 Equity Shares have been allotted on
December 1, 1992.

- 72 -
3. 45,34,370 convertible debentures of face value of Rs.50/- each were issued on June 26, 1997. Pursuant to the
conversion of the debentures, 45,34,370 Equity Shares have been allotted on June 26, 1998, 90,68,740 Equity
Shares have been allotted on June 26, 1999 and 90,68,740 Equity Shares have been allotted on June 26, 2000.

4. Pursuant to a scheme of amalgamation sanctioned by the Hon’ble High Court of Madras vide its order dated
November 25, 2005, our Company issued and allotted 6,06,33,350 fully paid-up Equity Shares of our Company
to the shareholders of SIL, whose names appeared in the register of members on record date in connection with
the aforesaid scheme of amalgamation, in a ratio of 1 fully paid up Equity Shares of our Company, for every 1
fully paid up equity share of the face value of Rs. 10/- each, of SIL.

5. Pursuant to a scheme of amalgamation sanctioned by the Hon’ble High Court of Madras vide its order dated
December 1, 2006, our Company issued and allotted 1,86,45,886 fully paid-up Equity Shares of our Company
to the shareholders of SOFL, whose names appeared in the register of members on record date in connection
with the aforesaid scheme of amalgamation, in a ratio of 3 fully paid up Equity Shares of our Company, for
every 5 fully paid up equity share of the face value of Rs. 10/- each, of SOFL.

6. On January 28, 2010, our Company issued and allotted 11,658,552 Equity Shares of at a price of Rs.500.80 per
such Equity Share, aggregating to Rs. 58,386.03 lacs to Qualified Institutional Buyers pursuant to the provisions
of Chapter VIII of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)
Regulations, 2009, as amended.

7. On March 26, 2010 our Company has issued and allotted 1,084,700 Equity Shares at a price of Rs. 35 per
Equity Share pursuant to the exercise of stock options issued under our ESOP scheme. Our Company has made
separate applications all dated April 13, 2010, to MSE, NSE, and BSE in connection with obtaining approval
therefrom, for trading of the aforementioned Equity Shares. We have received approvals for the trading of the
aforementioned Equity Shares from the BSE and the MSE vide their letters dated April 19, 2010 and April 30,
2010, respectively. The approval from the NSE in connection with the trading of the aforementioned Equity
Shares is still awaited.

Share holding pattern of our Company as on April 30, 2010:

Sr. Name of the Shareholder No. of shares Nominal Total Paid up Percentage
No. Value (Rs.) capital (Rs.) (% )

A PROMOTER AND PROMOTER GROUP

(1) Indian

A Individual/Hindu Undivided Family - - - -

B Central Government/ State Governments - - - -

C
Bodies Corporate 9,33,71,512 10 93,37,15,120 41.40

D Financial Institutions / Banks - - - -

E Any other (Specify)
- - - -
Sub Total A(1) 9,33,71,512 10 93,37,15,120 41.40
(2) Foreign
Individual (Non resident Individuals / Foreign
A individuals) - - - -
B Bodies Corporate - - - -
C Institutions - - - -
Any other (Specify)
D - - - -

- 73 -
 Sub Total A(2) - - - 0.00
Total shareholding of Promoter and Promoter 9,33,71,512 10 93,37,15,120 41.40
Group (A)= (A)(1) +(A)(2)
B Public Shareholding

(1) Institutions

A Mutual Funds/ UTI 88,24,531 10 8,82,45,310 3.91

B Financial Institutions / Banks 2,00,120 10 20,01,200 0.09

C Central Government/ State Governments - - - -

D Venture capital Funds - - - -

E Insurance Companies - - - -

F Foreign Institutional Investors 7,69,51,568 10 76,95,15,680 34.12

G Foreign Venture Capital Investors - - - -

H Any other (Foreign Banks) - - - -

Sub Total B(1) 8,59,76,219 10 85,97,62,190 38.12
(2) Non-Institutions

A Bodies Corporate 2,38,12,701 10 23,81,27,010 10.56

b Individuals - - - -
Individual Shareholders holding Nominal Share
(i) Capital upto Rs.1 Lakh 1,62,91,517 10 16,29,15,170 7.22
Individual Shareholders holding Nominal Share
( i i) Capital in excess of Rs.1 Lakh 40,84,379 10 4,08,43,790 1.81
C Any other

- NRI 3,11,659 10 31,16,590 0.14

- Overseas Corporate Bodies 50 10 500 0.00

- Clearing Members 16,68,781 10 1,66,87,810 0.74

- Trusts 1,000 10 10,000 0.00

Sub Total B(2) 4,61,70,087 10 46,17,00,870 20.47

Total Public Shareholding (B)= (B)(1)+(B)(2) 13,21,46,306 10 1,32,14,63,060 58.60
TOTAL (A) + (B) 22,55,17,818 10 2,25,51,78,180 100.00
C Shares held by Custodians and against which
Depository Receipts have been issued

Grand Total (A) + (B) + ( C) 22,55,17,818 10 2,25,51,78,180 100.00

- 74 -
List of top ten holders of Equity Shares of our Company as on April 30, 2010:

Total Number of Equity Percentage Holding

S.No Name of shareholders Address
Shares held (%)
1 Shriram Holdings (Madras) Mookambika Complex,4 9,3371,512 41.40
Private Ltd. Lady Desika Road,
Mylapore, Chennai, 600004

2 Genesis Indian Investment Deutsche Bank AG,DB 1,57,20,957 6.97

Company Limited -General Sub House, Hazarimal Somani
Fund Marg, Post Box No. 1142,
Fort, Mumbai,
400001
3 ICICI Prudential Life Insurance Deutsche Bank AG,DB 1,09,47,813 4.85
Company Ltd House, Hazarimal Somani
Marg, Post Box No. 1142,
Fort, Mumbai,
400001
4 FID Funds (Mauritius) Limited Citibank N. A. Custody 36,25,000 1.61
Services, 3rd Floor Trent
House G Block, Plot No 60
Bandra Kurla Complex
Bandra(East),Mumbai,
400051
5 Reliance Life Insurance Company Deutsche Bank AG,DB 29,55,280 1.31
Limited House, Hazarimal Somani
Marg, Post Box No. 1142,
Fort, Mumbai,
400001
6 Copthall Mauritius Investment J.P. Morgan Chase Bank 28,62,218 1.27
Limited N.A., India Sub Custody,6th
Floor, Paradigm
B,Mindspace, Malad
(West), Mumbai, 400064
7 Wellington Management HSBC Securities 27,62,307 1.22
Company, LLP A/C Bay Pond Services,2nd Floor"Shiv",
MB Plot No.139-140 B, Vile
Parle-East, Mumbai,
400057
8 Columbia Acorn International Deutsche Bank AG,DB 23,96,050 1.06
House, Hazarimal Somani
Marg,Post Box No. 1142,
Fort, Mumbai,
400001
9 Norges Bank A/C Government C/O Standard Chartered 23,09,028 1.02
Petroleum Fund Bank, Securities
Services,23- 25 M. G.
Road, Mumbai,
400001
10 Sloane Robinson LLP A/C SR HSBC Securities 20,09,730 0.89
Global (Mauritius)Limited (Class Services,2nd Floor 'Shiv',
G - Emerging Plot No.139-140 B,Western
Express Highway, Sahar
Road Junction,Vile Parle-
East, Mumbai,
400057

- 75 -
List of top ten holders of debt instruments, as on April 30, 2010.

1. List of top ten Subordinate Debt instruments holders (issued on private placement basis) face value Rs.1000/-
as on April 30, 2010.

S. No. Name of holder Address Number of Aggregate

instruments Amount (Rs.
in lacs)

1 Shriram General Insurance E-8, Epip Riico, 115,000 1,150.00

Company Limited Sitapur, Jaipur
Rajasthan

2 Shriram Asset Management 106 Shiv Chambers, Sector-11, CBD- 41,340 413.40
Co Ltd Belapur,Navi Mumbai, Maharashtra

3 Milind P Bhandarkar The Great Eastern, Retreat Fp 496-497 A, 10,100 101.00

Model Colony Nr Lakaki Bungalow Flat No
101, Pune, Maharashtra

4 S Krishnan 31,Khushali, 9,170 91.70

5 Urmila Ulhas Ghosalkar
6 Shriram Life Insurance Co
Ltd
Plot No 358, Central Avenue Road,
Chembur, Mumbai, Maharashtra
Daily Ratnagiri Times H.No. 1777, Maruti 8,716 87.16
Lane, Ratnagiri, Maharashtra
Regd Office 3-6-478, Anand Estates III 8,400 84.00
Floor, Liberty Road Himayath Nagar,
Hyderabad, Andhra Pradesh

7 T N Swaminathan Flat 31,3rd Floor,'Khushali' Plot 358, 8,135 81.35

Central Avenue Road, Chembur, Mumbai
Maharashtra

8 Leela Ramachandran Flat F8, III Floor,No.12, 6,840 68.40

Postal Colony, II Street,
West Mambalam, Chennai, Tamilnadu.

9 Sudha Patel Shanti Bihar Colony, Rajakhedi, Makronia, 6,453 64.53

Sagar, Madhya Pradesh.
10 Devyani Richharia T -1, Thadaram Apartment-2, Kohefiza 6,146 61.46
Bhopal,MP

- 76 -
2. List of top ten Debenture (issued on private placement basis) holders face value Rs.1000/- as on April 30,
2010.

S. No. Name of Debenture holder Address Number of Aggregate

Debentures Amount (Rs.
in lacs)

1. V. Shankar A-121, Kalpataru Residency, Opp .Cine 250,000 2,500.00

Planet, Sion (East), Mumbai, Maharashtra.

2. Shriram Life Insurance Regd. Office 3-6-478, Anand Estates, 3rd 227,050 2,270.50
Company Limited Floor, Himayath Nagar, Hyderabad, Andhra
Pradesh.

3. T. N. Swaminathan Flat-31, 3rd Floor, Khushali, Plot No. 358, 58,150 581.50
Central Avenue Road, Chembur, Mumbai ,
Maharashtra .

4. Vanilla Holding & Investments New No. 8, Old No. 25, 2nd Street, D. P. 35,000 350.00
Private Limited Nagar, Koturpuram, Chennai, Tamilnadu.

5. JRG Fincorp Limited JRG House, Ashoka Road, Kaloor, 35,000 350.00
Ernakulam, Kerala.
6. Om Bhoo Vikas & Insurance Opp. New Bus Stand, Pachari, 29,210 292.10
Private Limited Paradurg, Chhattisgarh.
7. Ravindra Bahl Eg-1/49, Garden Estate, Gurgaon, Haryana. 21,200 212.00

8. Renu Hingorani 7A, Jeevan Jagruti, Dr. Ambedkar Road, 20,000 200.00
Bandra (West), Mumbai , Maharashtra.
9. Lalitha Swaminathan Flat No. 31, 3rd Floor,'Khushali', Plot No. 16,500 165.00
358, Central Avenue Road, Chembur,
Mumbai , Maharashtra.
10. Shuneel Kumari Ram N-29C, 1st Floor, SFS Flats, Saket , 16,000 160.00
New Delhi.

3. List of top ten holders of deposits as on April 30, 2010.

S. No. Name of holder Address Aggregate Amount

(Rs. in lacs)

1 Raghuram J. Chandrani 6/36, Jalaram Nivas, Jalaram Apa, 390.00

Virpur, Rajkot, Gujarat.
2 Express Newspapers Private Express Estates No. 2, Club House Road, Mount 298.00
Limited Road, Chennai, Tamil Nadu.

3 Sudershan Nirula A-17, Sector-19, Nodia, Gautam Budh Nagar, Nodia, 240.00
Uttar Pradesh.

- 77 -
 S. No. Name of holder Address Aggregate Amount
(Rs. in lacs)

4 LTS Consultants (Private) DD-21, Kalkaji, New Delhi. 200.00

Limited
5 Rategain IT Solutions Private Rategain IT Solutions Private Limited, 198.00
Limited B-15, Sector-57, Noida, Uttar Pradesh.

6 Shiva Shakti Properties Private 706, 7th Floor, Raheja Centre, 214, Free Press 198.00
Limited Journal Marg, Nariman Point, Mumbai,
Maharashtra.

7 Welfare for Indian Seamen No 22/1A, Mohanchand Road, Kidderpore, Kolkata, 126.00
Everywhere West Bengal.
8 Ultramarine & Pigments No : 556, Vanagaram Road, Ambattur, Chennai, 125.00
Limited Tamil Nadu.
9 Automotive Exchange Private 11th Floor, Vishwaroop IT Park, Sector-30 A, Vashi, 100.00
Limited Navi Mumbai, Maharashtra.
10 Cheviot Agro Industries 24-Park Street, Magma House, 9th Floor, Kolkata, 100.00
Limited West Bengal.
10 Institute of Actuaries of India 302, Indian Globes Chambers, 142, Fort Street, D. N. 100.00
Road, Near CST Station, Mumbai , Maharashtra.

10 Naishadh Jawahar Paleja 901/902, Kaveri Neelkanth Valley, Rajawadi Road 100.00
No.7, Ghatkopar (East), Mumbai , Maharashtra.

10 Leena Gandhi Tewari 41 - Ritu Apartment, 208 B. J. Road, Bandra (West), 100.00
Mumbai, Maharashtra.

4. List of top ten holders of Secured Non-Convertible Debentures issued to public - Option –I (Rs. 87.25 crore)
of face value Rs. 1000/- per debenture as on April 30, 2010

S. Name of holder Address Number of Aggregate Amount (Rs.

No. Instrument In lacs)
1 LIC MF Monthly Income LIC Mutual Fund, Asset Management 1,71,627 1,716.27
Plan Company Limited, Industrial
Assurance Building, 4th Floor, Opp.
Churchgate Station, Mumbai -
400020

2 LIC MF Floater MIP-Plan Jeevan Bima Sahayog Asset 61,002 610.02

'A' Management,
Industrial Assurance Building,
4th Floor,Opp Churchgate Station,
Mumbai- 400020
3 Bangiya Gramin Vikash BMC House, Chuapurp O, 50,000 500.00
Bank Berhampore,
Dist. Murshidabad,
West Bengal - 742101

- 78 -
 4 Kotak Mahindra Trustee Deutsche Bank, AGDB House, 32,984 329.84
Company Limited A/C Hazarimal Somani Marg
Kotak Mahindra Income Post Box No. 1142, Fort
Plus Mumbai - 400001
5 LICMF Unit Linked LIC Mutual Fund, Asset Management 21,246 212.46
Insurance Scheme Company Limited, Industrial
Assurance Building, 4th Floor, Opp.
Churchgate Station,
Mumbai- 400020
6 Kotak Mahindra Trustee Deutsche Bank, AGDB House, 14,850 148.50
Company Limited A/C - Hazarimal Somani Marg,
Kotak Mahindra Balance Post Box No. 1142, Fort,
Units Mumbai - 400001

7 LIC MF Childrens Fund Jeevan Bima Sahayog Asset 9,000 90.00

8 Pinkhem Investments
Company Private Limited
Management, Industrial Assurance
Building, 4th Floor,
Opp Churchgate Station,
Mumbai - 400020
Bombay Cotton Mills Compound, 6,265 62.65
Dattaram Lad Path, Mumbai - 400033

9 Trustees Hindustan Steel Steel Authority of India Limited, 4,354 43.54

Limited Contributory Rourkela - 769001
Provident Fund, Rourkela
10 Power And Insulators 115, N.S. Road, 3rd. Floor, 4,235 42.35
Private Limited Kolkata - 700001

5. List of top ten holders of Secured Non-Convertible Debentures issued to public - Option –II (Rs. 73.75
crore) of face value Rs. 1000/- per debenture as on April 30, 2010

S. Name of holder Address Number of Aggregate Amount

No. Instrument (Rs. In lacs)
1 IDBI Bank Limited - TBO IDBI Limited, IDBI Tower 17th 32,984 329.84
Floor, World Trade Centre Complex,
Cuffe Parade, Mumbai 400005
2 UCO Bank Treasury Branch, 32,984 329.84
UCO Bank Building,
Mezzanine Floor,
359, Dr. D N Road,
Fort, Mumbai 400001
3 Vipul Rameshchandra Shah C/o. JM Financial Products Private 5,700 57.00
Limited, Apeejay House, 3rd Floor,
3, Dinshaw Vachha Road,
Churchgate,
Mumbai 400020
4 Dr. Shripal Mansukhlal 21, Sadhna, 2nd Floor, 2,500 25.00
Doshi B Road, Churchgate
Mumbai 400020
5 Rakesh Agrawal Elegant House, Raghuvanshi Mills 2,089 20.89
Compound,
Senapati Bapat Marg,
Lower Parel, Mumbai 400013

- 79 -
S. Name of holder Address Number of Aggregate Amount
No. Instrument (Rs. In lacs)
6 Elegant Marbles and Grani Elegant House, Raghuvanshi Mills 2,089 20.89
Industries Limited Compound, Senapati Bapat Marg,
Lower Parel,
Mumbai 400013
7 Hemant Jaysukhlal Gandhi 411, Veena Vihar, 1,887 18.87
Near Shanmukhananda Hall
Sion, Mumbai 400022
8 Jinender Jain S-21, Greater Kailash-II, 1,800 18.00
Ground Floor,
New Delhi 110048
9 Kalawati Kothari 502, Venus Appartment, 1,500 15.00
Behind Pancholi Hospital,
Nathpai Nagar,
Ghatkopar East,
Mumbai 400077
10 Kishore Hargovind Gopani 113, Mahagiri Apartment, 1,500 15.00
Ashok Road, Near Jain Temple,
Kandivali ( East ),
Mumbai 400101

- 80 -
6. List of top ten holders of Secured Non-Convertible Debentures issued to public - Option –III (Rs. 104.23
crore) of face value Rs. 1000/- per debenture as on April 30, 2010

Sr. Name of holder Address Number of Aggregate

No. Instrument Amount (Rs. In
lacs)
1 ECL Finance Limited 14 th Floor, Express Tower 104,442 1,044.42
Nariman Point,
Mumbai 400021
2 Edelweiss Finance And 14 th Floor, Express Tower 80,000 800.00
Investments Limited Nariman Point,
Mumbai 400021
3 UTI-MIS-Advantage Plan UTI AMC Private Limited 65,969 659.69
UTI Tower,
GN Block, Bandra
Kurla Complex, Bandra (East),
Mumbai 400051
4 Haren Textile Private Before Dahisar Toll Naka, Western 35,251 352.51
Limited Express Highway, Dahisar (East),
Mumbai 400068
5 Cheviot Company Limited 24, Park Street, Nagma House 20,000 200.00
9th Floor, Kolkata 700016
6 ECL Finance Limited 14th Floor, Express Tower 15,558 155.58
Nariman Point,
Mumbai 400021
7 Agarwal Packaging 364, Tejal Housing Society, 8,499 84.99
Private Limited Gokhale Road, Model Colony
Pune 411016
8 Kusum Shroff Nirvan Building, 8,352 83.52
2nd Floor, Oomer Park,
95/D, Bhulabhai Desai Road,
Mumbai 400036.
9 Kamesh Goyal C/O.Chief Executive Officer, 6,467 64.67
Bajaj Allianz General Insurance
Company Limited,
GE Plaza, Airport Road,
Yerawada, Pune 411006
10 Sarla P. Parikh 4, Jayant Mahal Road, 4,588 45.88
Churchgate, Mumbai 400020

7. List of top ten holders of Secured Non-Convertible Debentures issued to public - Option –IV (Rs. 22.74 crore)
of face value Rs. 1000/- per debenture as April 30, 2010

Sr. Name of holder Address Number of Aggregate Amount

No. Instrument (Rs. In lacs)
1 ECL Finance Limited 14th Floor, Express Towers, 1,04,402 1,044.02
Nariman Point, Mumbai 400021
2 Vishnu Kumar Bangur 199, Chittaranjan Avenue, 2,188 21.88
Kolkata 700006
3 Manish Kishan Gupta 1,Sardar Patel Nagar, Ellisbridge, 2,100 21.00
Ahmedabad 380006
4 Bharati Ajay Sheth 10 Kailas Deep, 2 nd Floor, 1,700 17.00
38, Bajaj Road, Vile Parle
Mumbai, Opp Vishwakarma Baug,
- 81 -
Sr. Name of holder Address Number of Aggregate Amount
No. Instrument (Rs. In lacs)
Mumbai 400056

5 PJL Clothing ( India ) Limited 27, Raghuvanshi Estate, 1,486 14.86

Senapati Bapat Marg,
Lower Parel, Mumbai 400013
6 Meena Bangur 199, Chittaranjan Avenue, 1,453 14.53
Kolkata 700006
7 Paru Mayur Shridharani A-707/708, Shree Adinath Tower, 1,000 10.00
Near Nensey Colony
Borivli East, Mumbai 400066
8 Baroda Brokers Private Klassic Chambers, 950 9.50
Limited 2nd Floor, Nr Navrangpura Post
Office, Navrangpura,
Ahmedabad 380009

9 Bedrock Limited 6 B, Court Chambers, 801 8.01

35, New Marine Lines,
Mumbai 400020
10 Vinay Kumar Baid Hanut Niwas, 755 7.55
Dadabhai Road ,
No. 2 , Andheri (West)
Mumbai 400058

8. List of top ten holders of Secured Non-Convertible Debentures issued to public - Option –V (Rs. 669.89
crore) of face value Rs. 1000/- per debenture as on April 30, 2010

Sr. Name of holder Address Number of Aggregate Amount

No. Instrument (Rs. In lacs)
1 Kotak Mahindra Trustee Deutsche Bank, AGDB House, 23,40,003 23,400.03
Company Limited A/C - Hazarimal Somani Marg,
Kotak Flexi Debt Scheme Post Box No. 1142, Fort,
Mumbai 400001
2 Kotak Mahindra Bank Limited KMBL Treasury Account 7,65,114 7,651.14
2nd Floor, Bakhtawar, 229, Nariman
Point, Mumbai 400021
3 ECL Finance Limited 14th Floor, Express Towers Nariman 477,711 4,777.11
Point,
Mumbai 400021
4 HDFC Trustee Company HDFC Bank Limited 388,876 3,888.76
Limited A/C High Interest Custody Services,
Fund Short Term Plan Lodha - I Think Techno Campus,
Off Floor 8, Next To Kanjur Marg
Station, Kanjur Marg (East)
Mumbai 400042
5 Kotak Mahindra Trustee Deutsche Bank, AGDB House, 336,523 3,365.23
Company Limited A/C Kotak Hazarimal Somani Marg, Post Box
Mahindra Short Term Bond No.1142, Fort, Mumbai 400001
6 IDFC Super Saver Income Deutsche Bank, AGDB House, 250,969 2,509.69
Fund- Short Term Hazarimal Somani Marg,
Post Box No. 1142, Fort,
Mumbai 400001
7 Radha Madhav Investments Mittal Chambers, 250,000 2500.00
Limited Nariman Point,

- 82 -
Sr. Name of holder Address Number of Aggregate Amount
No. Instrument (Rs. In lacs)
Mumbai 400021

8 HDFC Trustee Company
Limited, HDFC Mutual Fund,
Monthly Income Plan Long
Term Plan
9 ICICI Prudential Short Term
Plan
10 Wishbone Global Investment
Holdings
HDFC Bank Limited, Custody Services, 190,969 1,909.69
Lodha - I Think Techno Campus, Off
Floor 8, Next To Kanjur Marg Station,
Kanjurmarg (East), Mumbai 400042
HDFC Bank Custody Services, Lodha I, 1,50,000 1,500.00
Think Techno Campus, Off Flr 8, Next
to Kanjurmarg Station, Kanjurmarg
(East), Mumbai 400042
Citibank N. A, Custody Services 150,000 1,500.00
3rd Floor, Trent House,
G Block, Plot No. 60, Bandra-Kurla
Complex, Bandra (East), Mumbai
400051

9. List of top ten holders of A-series non convertible debentures (Rs. 514 crore) of face value Rs. 10 Lacs per debenture, as
on April 30, 2010.

S. No Name of holder Address Number of Aggregate

1 ICICI Prudential Flexible Income
Plan
2 UTI - Treasury Advantage Fund
3 UTI-Unit Linked Insurance Plan
4 UTI - Retirement Benefit Pension
Fund
5 The Hongkong And Shanghai
Banking Corporation Limited
6 UTI – Children’s Career
Balanced Plan
instrument Amount (Rs. In
lacs)
HDFC Bank Limited, Custody 1,000 10,000.00
Services, Lodha – I, Think Techno
Campus Office, 8th Floor, Next to
Kanjurmarg Station, Kanjurmarg East
Mumbai – 400042.
UTI Mutual Fund, UTI Asset 986 9,860.00
Management Company Limited,
Department of Fund Accounts ,UTI
Tower, ‘GN’ Block, Bandra Kurla
Complex, Bandra (East), Mumbai –
400051.
UTI AMC Private Limited UTI Tower, 450 4,500.00
‘GN’Block, Bandra Kurla Complex
Bandra (East), Mumbai – 400051.
UTI Mutual Fund, UTI Asset 290 2,900.00
Management Company Private
Limited, Department of Fund
Accounts, UTI Tower, ‘GN’Block,
Bandra Kurla Complex, Bandra (East),
Mumbai – 400051.
HSBC Securities Services, 2nd Floor 250 2,500.00
"Shiv", Plot No. 139-140B, Western
Express Highway, Sahar Road
Junction, Vile Parle-East, Mumbai -
400057.
UTI Mutual Fund, UTI Asset 250 2,500.00
Management company Limited,
Department of Fund Accounts ,UTI
Tower, ‘GN’ Block, Bandra Kurla
Complex Bandra (East), Mumbai –
400051.
- 83 -
 S. No Name of holder Address Number of Aggregate
instrument Amount (Rs. In
lacs)
7 UTI-Liquid Cash Plan UTI AMC Private Limited UTI Tower, 250 2,500.00
‘GN’Block Bandra Kurla Complex,
Bandra (East), Mumbai – 400051.
8 UTI-Unit Scheme For Charitable UTI AMC Private Limited, UTI Tower, 250 2,500.00
And Religious Trusts And ‘GN’ Block Bandra Kurla Complex,
Registered Societies Bandra (East), Mumbai - 400051.
9 Fortis Money Plus Fund Deutche Bank, AGDB House, 200 2,000.00
Hazarimal Somani Marg, Post Box No.
1142, Fort, Mumbai – 400 001
10 Kotak Mahindra Trustee Co. Deutche Bank, AGDB House, 200 2,000.00
Limited A/c Kotak FMP 370 Hazarimal Somani Marg, Post Box No.
Days Series I 1142, Fort, Mumbai – 400 001

10. List of top ten holders of B-series non convertible debentures (Rs.1,175 Crore) of face value Rs. 10 Lacs per
debenture, as on April 30, 2010.

S. No Name of holder Address Number of Aggregate

instrument Amount (Rs. In
lacs)
1 Standard Chartered Bank Standard Chartered Bank (Mauritius) 2,500 25,000.00
(Mauritius) Limited –Debt Securities Services, 23-25 M.G. Road,
Fort, Mumbai – 400001.
2 Franklyn Templeton Mutual Fund CITI Bank N A, Custody Services, 3rd 1,000 10,000.00
A/c Templet on Floating Rate Floor, Trent House, G Block, Plot No.
Income Fund Long Term Plan 60, Bandra Kurla Complex, Bandra
East, Mumbai – 400051.
3 Morgan Stanley India Capital HSBC Securities Services2Nd 1,000 10,000.00
Private Limited Floor"Shiv", Plot No.139-140 B
Western Exp Highway, Sahar Rd
Junctvile Parle-E, Mumbai 400057
4 ICICI Prudential Fixed Maturity HSBC Securities Services,2Nd Floor 800 8,000.00
Plan – Series 45 - Three Years "Shiv", Plot No 139-140 Bwestern Exp.
Plan Highway, Sahar Rd Junctvile Parle-E,
Mumbai400057
5 Fortis Money Plus Fund Deutsche Bank AGDB House, 750 7,500.00
Hazarimal Somani Marg Post Box No.
1142, Fort mumbai 400001

6 HDFC Trustee Company Limited
A/C HDFC Cash Management
Fund Treasury Advantage Plan
7 Reliance Capital Trustee Co
Limited A/C-Reliance Money
Manager Fund
HDFC Bank Ltd, Custody Services 501 5,010.00
lodha - I Think Techno Campus off Flr
8, Next To Kanjurmarg Stn kanjurmarg
East Mumbai400042
Deutsche Bank AGDB House, 500 5,000.00
Hazarimal Somani Marg Post Box No.
1142, Fort mumbai 400001

8 ICICI Prudential Real Estate HSBC Securities Services,2nd Floor 450 4,500.00
Securities Fund "Shiv", Plot No 139-140 Bwestern Exp.
Highway, Sahar Rd Junctvile Parle-E,
Mumbai400057
- 84 -
 S. No Name of holder Address Number of Aggregate
instrument Amount (Rs. In
lacs)
9 Baroda Pioneer Treasury Citibank N A, Custody Services3Rd 400 4,000.00
Advantage Fund Flr, Trent House, G Block,Plot No. 60,
Bandra Kurla Complex, Bandra – East,
Mumbai – 400051
10 HDFC Trustee Company Limited HDFC Bank Ltd, Custody Services 345 3,450.00
A/C HDFC FMP 22M September lodha - I Think Techno Campus off Flr
2008 8, Next To Kanjurmarg Stn.
Kanjurmarg East Mumbai400042

11. List of top ten holders of C-series non convertible debentures (Rs.400 Crore) of face value Rs. 10 Lacs per
debenture, as on April 30, 2010.

S. No Name of holder Address Number of Aggregate

instrument Amount (Rs. In
lacs)
1 Life Insurance Corporation of Investment Department, 6th Floor, 3,000 30,000.00
India West Wing, Central Office,
Yogakshema, Jeevan Bima Marg
Mumbai - 400021.
2 United Bank Of India The Deputy General Manager UBI 500 5,000.00
Investment Fund Management Dept
Head Office 4th Floor 16 Old
Courthouse Street, Kolkata 700001
3 Kotak Mahindra Trustee Deutsche Bank AGDB House, 180 1,800.00
Company Ltd. A/C Kotak flexi Hazarimal Somani Marg Post Box No.
Debt Scheme 1142, Fort, Mumbai 400001
4 Tata Trustee Company Ltd A/C C/O Standard Chartered Bank securities 150 1,500.00
Tata Mutual Funda/C Tata Fixed Services23-25 , M.G. Road , Fort
Maturity Plan - Series 25 Scheme Mumbai 400001
A
5 General Insurance Corporation Suraksha, 170, J. Tata Road, Church 100 1,000.00
Of India Gate, Mumbai 400020
6 Kotak Mahindra Trustee Co. Ltd. Deutsche Bank AGDB House, 70 700.00
A/C Kotak Fmp18M Series 3 Hazarimal Somani Marg Post Box No.
1142, Fort Mumbai400001

12. List of top ten holders of Subordinate Debts, D-series non convertible debentures (Rs.550.97 Crore) of face value Rs. 1
Lac per debenture, as on April 30, 2010

S. No Name of holder Address Number of Aggregate

instrument Amount (Rs. In
lacs)
1 Central Bank Of India Central Bank Of India treasury 9,500 9,500.00
Department, Chandra mukhi Building,
Nariman Point, Mumbai – 400021.
2 UCO Bank Treasury Branch, UCO Bank Building 5,000 5,000.00
Mezzanine, 359th Floor Dr D. N.
Road, Fort, Mumbai – 400001.

- 85 -
 S. No Name of holder Address Number of Aggregate
instrument Amount (Rs. In
lacs)
3 Securities Trading Corporation Of HDFC Bank Limited, Custody 3,950 3,950.00
India Limited Services, Lodha - I, Think Techno
Campus Office, 8th Floor, Next To
Kanjurmarg Station, Kanjurmarg East,
Mumbai – 400042.
4 Bank Of Maharashtra Treasury And International Banking, 3,000 3,000.00
2nd Floor, 23 Maker Chamber III,
Nariman Point, Mumbai -
400021.
5 ICICI Bank Limited Treasury Middle Office Group2Nd 2,920 2,920.00
Floor, North Tower, East Wing ICICI
Bank Tower, Bkc bandra (East) ,
Mumbai 400051
6 Air- India Employees Provident Air India Employees Provident fund 2,200 2,200.00
Fund Account, Old Air Port Santacruz ,
Mumbai – 400029.

7 Bank of Baroda Specialized. Integrated treasury 2,000 2,000.00

Branch, Kalpataru Heritage Building,
6th Floor, .Nanik Motwane Marg,
Mumbai – 400023.
8 Bank of India Treasury Branch, Head Office, Star 2,000 2,000.00
House, 7th Floor,C-5, 'G' Block, Bandra
Kurla Complex, Bandra (East),
Mumbai -.400051.
9 Chhattisgarh State Electricity Shed No.1,Dangania, Raipur- 2,000 2,000.00
Board (CSEB) Provident Fund 492013.
Trust
10 United India Insurance Company 24,Whites Road, Chennai-600014. 2,000 2,000.00
Limited

13. List of top ten Holders of Subordinate Debts, D-series non convertible debentures (Rs. 50 Crore) of face
value Rs. 10 Lacs per debenture, as on April 30, 2010.

S. No Name of holder Address Number of Aggregate

instrument Amount (Rs. In
lacs)
1 HVPNL Employees Pension Fund Shakti Bhawan, Sector 6, Panchkula 225 2,250.00
Trust (Haryana) -134109.
2 Food Corporation Of India Khadya Sadan, 13th Floor, 16 20 100 1,000.00
Contributory Provident Fund Barakhamba Lane, New
Trust Delhi-110001.
3 HVPNL Employees Provident Shakti Bhawan, Sector 6, Panchkula 75 750.00
Fund Trust (Haryana) – 134109.
4 Gas Authority Of India Limited Gas Authority Of India Limited, 16 30 300.00
Employees Provident Fund Trust Bhikaiji Cama Place, New
Delhi-110066.
5 The Jammu And Kashmir Bank Jammu And Kashmir Bank Corporate 20 200.00
Employees Provident Fund Trust Office, M.A. Road Srinagar-190001.
6 Gail Employees Superannuation Gas Authority India Limited, 16 10 100.00
Benefit Fund Bhikaiji Cama Place,

- 86 -
 S. No Name of holder Address Number of Aggregate
instrument Amount (Rs. In
lacs)
New Delhi-110066.

7 Gujarat Alkalies And Chemicals Gujarat Alkalies And Chemicals 10 100.00

Limited Employees provident
Fund Trust
8 Gail (India) Limited Employees
Death-Cum-Superannuation
Gratuity Scheme
9 Asbestos Cement Limited Staff
Provident Fund
10 Provident Fund Of Mangalore
Refinery And Petrochemicals
Limited
Limited O Petro Chemicals, Dist-
Vadodara-391346.
Gail Bhawan 16, Bhikaji Cama Place, 5 50.00
R.K Puram , New
Delhi-110066.
Genesis, A-32Mohan Co Operative 4 40.00
Industrial Estate, Mathura Road, New
Delhi-110044.
Maker Tower, F-16th Floor, Cuffe 4 40.00
Parade, Mumbai – 400005.

14. List of top ten holders of Subordinate Debts , S-Series non convertible debentures (Rs.150 Crore) of face
value Rs. 10 Lacs per debentures, as on April 30, 2010.

S. No Name of holder Address Number of Aggregate

instrument Amount (Rs. In
lacs)
1 LIC MF Income Plus Fund LIC Mutual Fund, Asset Management 750 7,500.00
Company Limited, Industrial
Assurance Building,4th Floor, Opp.
Churchgate Station, Mumbai – 400020.
2 Bank Of India Treasury Branch, Head Office, Star 300 3,000.00
House,7th Floor, C-5, 'G' Block,
Bandra Kurla Complex, Bandra (East),
Mumbai - 400051.
3 UTI - Monthly Income Scheme UTI Mutual Fund, UTI Asset. 150 1,500.00
Management Company Private
Limited, UTI Tower, 'GN' Blook,
Bandra Kurla Complex, Bandra (East),
Mumbai - 400051.
4 Oriental Bank Of Commerce Treasury Department, 30 33 A Block, 100 1,000.00
Ist Floor, Connaught Place, New Delhi-
110001.
5 UCO Bank Treasury Branch, UCO Bank Building, 100 1,000.00
Mezzanine 359th Floor Dr D. N. Road,
Fort, Mumbai – 400001.
6 UTI-Unit Linked Insurance Plan UTI AMC Private Limited UTI Tower, 100 1,000.00
‘GN’ Block, Bandra Kurla Complex,
Bandra (East) , Mumbai –
400051.

15. List of top ten holders of Subordinate Debts, E-Series non convertible debentures (Rs.100 Crore) of face
value Rs. 1 Lacs per debentures, as on April 30, 2010.

S. No Name of holder Address Number of Aggregate

instrument Amount (Rs. In
lacs)

- 87 -
 S. No Name of holder
1 Kotak Mahindra Trustee
Company Limited A/C Kotak
Mahindra Income Plus
2 A. K. Capital Services Limited
3 Bajaj Allianz Life Insurance
Company Limited
4 Kotak Mahindra Trustee
Company Limited A/C. Kotak
Mahindra Bond Unit Scheme 99
5 Bajaj Allianz General Insurance
Company Limited
6 Kotak Mahindra Trustee
Company Ltd. A/C Kotak
mahindra Income Plus
7 NPS Trust - A/C Sbi Pension
Fund - SG Scheme1
8 Kotak Mahindra Trustee
Company Ltd. A/C. Kotak
Mahindra Balance Unit Scheme
99
9 NPS Trust- A/C SBI Pension
Fund Scheme C
10 NPS Trust- A/C SBI Pension
Fund Scheme C - Tier II
16. List of top ten holders of Commercial paper (Rs. 125 Crore ) of face value Rs. 5 Lacs per instrument, as on
April 30, 2010
S. No Name of holder
1 Kotak Mahindra Trustee
Company Ltd. A/C Kotak Flexi
Debt Scheme
2 UTI-Floating Rate Fund-STP
3 Religare Trustee Company
Private Limited - A/C Religare
Ultra Short Term Fund
Address Number of Aggregate
instrument Amount (Rs. In
lacs)
Deutsche Bank, AGDB House, 2,000 2,000.00
Hazarimal Somani Marg, Post Box No.
1142, Fort, Mumbai - 400001.
30/39, , Free Press House ,3Rd 1,500 1,500.00
Floor,Free Press Journal Marg215 ,
Nariman Point, Mumbai400021
Deutsche Bank AGDB House, 1,500 1,500.00
Hazarimal Somani Marg Post Box No.
1142, Fort Mumbai400001
Deutsche Bank, AGDB House, 1,500 1,500.00
Hazarimal Somani Marg, Post Box No.
1142, Fort, Mumbai – 400001.
C/O Standard Chartered Bank custody 1,000 1,000.00
And Clearing Services23-25 M.G.
Road, Fort Mumbai400001
Deutsche Bank, AGDB House, 1,000 1,000.00
Hazarimal Somani Marg, Post Box No.
1142, Fort, Mumbai – 400001.
C/O SBI Pension Funds Pvt. Ltd.No. 969 969.00
32, 3rd Floor Maker Chambers - Iii,
Nariman Point Mumbai 400021
Deutsche Bank, AGDB House, 500 500.00
Hazarimal Somani Marg, Post Box No.
1142, Fort, Mumbai – 400001.
C/O SBI Pension Funds Pvt. Ltd.No. 30 30.00
32, 3rd Floor Maker Chambers – Iii
Nariman Point, Mumbai 400021
C/O SBI Pension Funds Pvt. Ltd.No. 1 1.00
32, 3rd Floor Maker Chambers – Iii
Nariman Point, Mumbai 400021
Address Number of Aggregate
instrument Amount (Rs. In
lacs)
Deutsche Bank AGDB House, 2,000 10,000.00
Hazarimal Somani Marg Post Box No.
1142, Fort Mumbai400001
UTI Amc Pvt. Ltd.UTI Tower,Gn 300 1,500.00
Blockbandra Kurla Complex, Bandra
(East), Mumbai400051
Deutsche Bank AGDB House, 200 1,000.00
Hazarimal Somani Marg Post Box No.
1142, Fort Mumbai400001
- 88 -
17. List of top ten holders of O-Series non convertible debentures (Rs.150 Crore) of face value Rs. 10 Lacs per debenture, as
on April 30, 2010.

S. No Name of holder Address Number of Aggregate

instrument Amount (Rs. In
lacs)
1 Life Insurance Corporation Of Investment Department 6th Floor, West 1,500.00 15,000.00
India Wing, Central Office, Yogakshema,
Jeevan Bima Marg, Mumbai – 400021.

18. List of top ten holder of short -term unsecured redeemable non convertible debentures (Rs.25 Crore) of face
value 10 Lacs per debenture, as on April 30, 2010.

S. No Name of holder Address Number of Aggregate

instrument Amount (Rs. In
lacs)
1 UTI - Fixed Maturity Plan - UTI Mutual Fund, UTI Asset 250 2500.00
Yearly Series September 09 Management company Limited,
Department Of Fund accounts ,UTI
Tower, ‘GN’ Block, Bandra Kurla
Complex, Bandra (East), Mumbai -
400051

19. Subordinate Debts , F-Series non convertible debentues (Rs.275 Crore) of face value Rs. 10 Lacs per
debentures as on April 30, 2010

Sr Name of holder Address Number of instrument Aggregate

No Amount (Rs.
in lacs)
1 ICICI Bank Ltd Treasury Middle Office 2,000 20,000
Group2Nd Floor, North Tower,
East WingICICI Bank Tower,
Bkc bandra (East) ,
Mumbai400051
2 ICICI Securities Primary Dealership ICICI Centreh T Parekh 250 2,500
Limited Margchurchgatemumbai400020
3 Infrastructure Development Finance C/O Standard Chartered Bank 250 2,500
Company Limited securities Services23-25, M.G.
Road, Fortmumbai400001
4 Trustees Hindustan Steel Limited Sail Rourkelarourkela769001 100 1000
Contributory provident Fund,
Rourkela
5 Board Of Trustees For Bokaro Steel Board Of Trustees For Bokaro 50 500
Employeesprovident Fund Steel Employeesprovident Fund
6 Rasoi Limited Rasoi Court,20, Sir R.N. 50 500
Mukherjee
Road,Kolkata700001
7 United India Insurance Company 24,Whites Roadchennai600014 50 500
Limited

Debt - equity ratio:

- 89 -
The debt-equity ratio prior to this Issue is based on a total outstanding consolidated debt of Rs. 2,255,612.60 lacs and
consolidated shareholder funds amounting to Rs. 306,137.87 lacs as on December 31, 2009. The debt equity ratio post
the Issue, (assuming subscription of NCDs aggregating to Rs.50,000 lacs) would be 7.53 times, is based on a total
outstanding debt of Rs. 2,305,612.60 lacs and shareholders fund of Rs. 306,137.87 lacs as on December 31, 2009.

Rs in Lacs
Particulars# Prior to the Issue Post the Issue*
Secured loans as on December 31, 2009 1,914,975.11 1,964,975.11
Unsecured loans as on December 31, 2009 340,637.49 340,637.49
Total Debt 2,255,612.60 2,305,612.60
Share capital as on December 31, 2009
21,279.86 21,279.86
Stock Option outstanding as on December
31, 2009 1,497.93 1,497.93

Share Application Money pending

allotments as on December 31, 2009 12.97 12.97
Reserves as on December 31, 2009
286,890.32 286,890.32
Less:Misc. expenditure (to the extent not
written off or adjusted) as on December 31, 3,543.21 3,543.21
2009
Total Shareholders Fund
306,137.87 306,137.87
Debt Equity Ratio (Number of times)
7.37 7.53
# On a consolidated basis.

* The debt-equity ratio post the Issue is indicative and is on account of assumed inflow of Rs. 50,000 lacs from the
Issue, as on December 31, 2009 and does not include contingent and off-balance sheet liabilities. The actual debt-equity
ratio post the Issue would depend upon the actual position of debt and equity on the date of allotment.

For details on the total outstanding debt of our Company, please refer to page 143 of this Prospectus.

- 90 -
 OBJECTS OF THE ISSUE

The funds raised through this Issue, after meeting the expenditures of and related to the Issue, will be used for our
various financing activities including lending and investments, subject to the restrictions contained in the Foreign
Exchange Management (Borrowing and Lending in Rupee) Regulations, 2000, and other applicable statutory and/or
regulatory requirements, to repay our existing loans and our business operations including for our capital expenditure and
working capital requirements.

The Unsecured NCDs will be in the nature of subordinated debt and will be eligible for Tier II capital and accordingly
will be utilised in acordnce with statutory and regulatory requirements including requirements of RBI.

The Main Objects clause of the Memorandum of Association of our Company permits our Company to undertake the
activities for which the funds are being raised through the present Issue and also the activities which our Company has
been carrying on till date.

Further, in accordance with the Debt Regulations, our Company will not utilize the proceeds of the Issue for providing
loans to or acquisitions of shares of any person who is a part of the same group as our Company or who is under the
same management as our Company.

The Issue proceeds shall not be utilized towards full or part consideration for the purchase or any other acquisition, inter
alia by way of a lease, of any property.

Interim Use of Proceeds

The management of our Company, in accordance with the policies formulated by it from time to time, will have
flexibility in deploying the proceeds received from the Issue. Pending utilization of the proceeds out of the Issue for the
purposes described above, our Company intends to temporarily invest funds in high quality interest bearing liquid
instruments including money market mutual funds, deposits with banks or temporarily deploy the funds in investment
grade interest bearing securities as may be approved by the Board. Such investment would be in accordance with the
investment policies approved by the Board or any committee thereof from time to time.

Monitoring of Utilization of Funds

There is no requirement for appointment of a monitoring agency in terms of the SEBI (Issue and Listing of Debt
Securities) Regulations, 2008. Our Board shall monitor the utilization of the proceeds of the Issue. For the relevant
Financial Years commencing from FY 2011, our Company will disclose in our financial statements, the utilization of the
net proceeds of the Issue under a separate head along with details, if any, in relation to all such proceeds of the Issue that
have not been utilized thereby also indicating investments, if any, of such unutilized proceeds of the Issue.

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 STATEMENT OF TAX BENEFITS

The information provided below sets out the possible tax benefits available to the debenture holders of an Indian
company in a summary manner only and is not a complete analysis or listing of all potential tax consequences of the
subscription, ownership and disposal of debenture, under the current tax laws presently in force in India. Several of these
benefits are dependent on the debentureholders fulfilling the conditions prescribed under the relevant tax laws. Hence the
ability of the debenture holders to derive the tax benefits is dependent upon fulfilling such conditions, which based on
business imperatives it faces in the future, it may not choose to fulfil. The following overview is not exhaustive or
comprehensive and is not intended to be a substitute for professional advice. Investors are advised to consult their own
tax consultant with respect to the tax implications of an investment in the debentures 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. We are not liable to the Debenture Holder in any manner for placing reliance upon
the contents of this statement of tax benefits.
To our Debenture Holder

A. INCOME-TAX

I To the Resident Debenture Holder

1. Interest on NCD received by Debenture Holders would be subject to tax at the normal rates of tax in accordance with
and subject to the provisions of the I.T. Act. No income tax is deductible at source as per the provisions of section 193 of
the Income Tax Act (IT Act) on interest on debentures in respect of the following:

(a) In case the payment of interest on debentures to resident individual Debenture Holder in the aggregate during the
financial year does not exceed Rs.2,500;

(b) When the Assessing Officer issues a certificate on an application by a Debenture Holder on satisfaction that the total
income of the Debenture holder justifies no/lower deduction of tax at source as per the provisions of Section 197(1) of
the I.T. Act; and that certificate is filed with the Company BEFORE THE PRESCRIBED DATE OF CLOSURE
OF BOOKS FOR PAYMENT OF DEBENTURE INTEREST

(c) When the resident Debenture Holder (not being a company or a firm or a senior citizen) submits a declaration in the
prescribed Form 15G verified in the prescribed manner to the effect that the tax on his estimated total income of the
previous year in which such income is to be included in computing his total income will be nil as per the provisions of
section 197A (1A) of the I.T. Act. HOWEVER Under section 197A (1B) of the I.T. Act, Form 15G cannot be submitted
nor considered for exemption from deduction from tax at source if the aggregate of income of the nature referred to in
the said section, viz. dividend, interest, etc as prescribed therein, credited or paid or likely to be credited or paid during
the Previous year in which such income is to be included exceeds the maximum amount which is not chargeable to tax,
as may be prescribed in each year’s Finance Act. To illustrate, as on 01.04.2009, the maximum amount of income not
chargeable to tax in case of individuals (other than women assessees and senior citizens) and HUFs is Rs.1,60,000, in
case of women assessees is Rs.1,90,000 and senior citizens is Rs. 2,40,000 for Previous Year 2009-10. Senior citizens,
who are 65 or more years of age at any time during the financial year, enjoy the special privilege to submit a self-
declaration in the prescribed Form 15H for non deduction of tax at source in accordance with the provisions of section
197A (1C) of the I.T. Act even if the aggregate income credited or paid or likely to be credited or paid exceeds the
maximum amount not chargeable to tax i.e. Rs. 2,40,000 for FY 2009-10 provided that the tax due on total income of the
person is NIL. In all other situations, tax would be deducted at source as per prevailing provisions of the I.T. Act; Form
No.15G WITH PAN /15H WITH PAN /Certificate issued u/s 197(1) has to be filed with the Company before the
prescribed date of closure of books for payment of debenture interest.

(d) On any securities issued by a company in a dematerialized form and is listed on recognized stock exchange in India.
(w.e.f. 1.06.2008).

2. Under section 2 (29A) of the I.T. Act, read with section 2 (42A) of the I.T. Act, a listed debenture is treated as a long
term capital asset if the same is held for more than 12 months immediately preceding the date of its transfer. Under
- 92 -
section 112 of the I.T. Act, capital gains arising on the transfer of long term capital assets being listed securities are
subject to tax at the rate of 10% of capital gains calculated without indexation of the cost of acquisition The capital gains
will be computed by deducting cost of acquisition of the debenture and expenditure incurred in connection with
such transfer from the full value of consideration.

In case of an individual or HUF, being a resident, where the total income as reduced by the long term capital gains is
below the maximum amount not chargeable to tax as prescribed by the Finance Act of the relevant year (i.e. as on
01.04.2009, such amount is Rs. 1,60,000 in case of all individuals, other than Women and Senior Citizens to Rs.
1,90,000 in case of women and to Rs.2,40,000 in case of senior citizens), the long term capital gains shall be reduced to
the extent of the difference between the maximum amount chargeable to tax and the total income and only the
balance long term capital gains will be subject to the flat rate of taxation in accordance with and the proviso to sub-
section (1) of section 112 of the I.T. Act read with CBDT Circular 721 dated September 13, 1995.

In addition to the aforesaid tax, in the case of domestic companies where the income exceeds Rs. 10,000,000, a surcharge
of 10% of such tax liability is also payable. A 2% EDUCATION CESS AND 1% SECONDARY AND HIGHER
EDUCATION CESS ON THE TOTAL INCOME TAX (INCLUDING SURCHARGE) IS PAYABLE BY ALL
CATEGORIES OF TAXPAYERS.

3. Short-term capital gains on the transfer of listed debentures, where debentures are held for a period of not more than
12 months would be taxed at the normal rates of tax in accordance with and subject to the provisions of the I.T. Act. The
provisions relating to maximum amount not chargeable to tax, surcharge and education cess described at Para 2 above
would also apply to such short-term capital gains.

4. In case the debentures are held as stock in trade, the income on transfer of debentures would be taxed as business
income or loss in accordance with and subject to the provisions of the I.T. Act.

5. HOWEVER, IN CASE WHERE TAX HAS TO BE DEDUCTED @ SOURCE WHILE PAYING

DEBENTURE INTEREST, THE COMPANY IS NOT REQUIRED TO DEDUCT SURCHARGE, EDUCATION
CESS ; AND SECONDARY AND HIGHER EDUCATION CESS REFERRED TO ABOVE.

6. Further, w.e.f April 1, 2010, as per Section 206AA of the Act, every person who is entitled to receive any sum or
income or amount on which tax is deductible at source, is required to furnish his Permanent Account Number
(PAN) to the person responsible for deducting such tax, failing which tax shall be deducted at the rates as per the
Act or 20% whichever is higher.

II. To the Other Eligible Institutions

All mutual funds registered under Securities and Exchange Board of India or set up by public sector banks or public
financial institutions or authorized by the Reserve Bank of India are exempt from tax on all their income, including
income from investment in Debentures under the provisions of Section 10(23D) of the I.T. Act subject to and in
accordance with the provisions contained therein.

B. WEALTH TAX

Wealth-tax is not levied on investment in debentures under section 2(ea) of the Wealth-tax Act, 1957.

C. GIFT TAX

Gift-tax is not levied on gift of debentures in the hands of the donor as well as the done because the provisions of the
Gift-tax Act, 1958 have ceased to apply in respect of gifts made on or after October 1, 1998. HOWEVER, IF ANY
INDIVIDUAL OR HUF, RECEIVES THESE DEBENTURES OF THE AGGREGATE VALUE OVER
RS.50,000 FROM ANY PERSON OR PERSONS WITHOUT CONSIDERATION OR RECEIVES THESE
DEBENTURES FOR A CONSIDERATION WHICH IS LESS THAN AGGREGATE FAIR MARKET VALUE
OF THE DEBENTURES BY AN AMOUNT EXCEEDING FIFTY THOUSAND RUPEES, THERE WILL BE
LIABILITY TO INCOME TAX TO THE EXTENT PROVIDED IN SEC.56(2)(vii) OF THE INCOME TAX
ACT. 1961 TO SUCH RECEIVER.

- 93 -
 SECTION IV : ABOUT THE ISSUER COMPANY AND THE INDUSTRY

INDUSTRY

The information in this section is derived from various government publications and other industry sources.
Neither we, nor any other person connected with the issue has verified this information. Industry sources and
publications generally state that the information contained therein has been obtained from sources generally believed to
be reliable, but their accuracy, completeness and underlying assumptions are not guaranteed and their reliability cannot
be assured and accordingly, investment decisions should not be based on such information.

In connection with the report by CRISIL Research titled "Retail Finance - Auto Annual Review" (January, 2010), CRISIL
Limited has used due care and caution in preparing the aforementioned report. Information has been obtained by
CRISIL from sources it considers reliable. However, CRISIL does not guarantee the accuracy, adequacy or
completeness of any information and is not responsible for any errors or omissions or for the results obtained from the
use of such information. No part of the aforementioned report may be published / reproduced in any form without
CRISIL’s prior written approval. CRISIL is not liable for any investment decisions which may be based on the views
expressed in the aforementioned report. CRISIL Research operates independently of, and does not have access to
information obtained by CRISIL’s Rating Division, which may, in its regular operations, obtain information of a
confidential nature that is not available to CRISIL Research.

Indian Economy

India is the world’s largest democracy by the population size, and one of the fastest growing economies in the world. It
has grown at an average rate of 7.5% per annum during the last three years. According to CIA World Factbook, India’s
estimated population was 1.16 billion people in July 2009. India had an estimated GDP of approximately US$ 3,548.0
billion in 2009, which makes it the fourth largest economy in the world after the United States of America, China and
Japan, in purchasing power parity terms. The following table presents a comparison of India’s real GDP growth rate with
the real GDP growth rate of certain other countries:

Countries* 2007 2008 2009

Australia 4.00% 2.40% 0.80%
Brazil 6.10% 5.10% 0.10%
China 13.00% 9.00% 8.40%
Germany 2.50% 1.30% (5.00)%
India 9.00% 7.40% 6.10%
Japan 2.30% (0.70)% (5.70)%
South Korea 5.10% 2.20% (0.80)%
Malaysia 6.20% 4.60% (2.80)%
Russia 8.10% 5.60% (8.50)%
Thailand 4.90% 2.60% (3.50)%
United Kingdom 2.60% 0.70% (4.30)%
United States 2.10% 0.40% (2.40)%
* Represents calendar year growth rates
(Source: CIA World Factbook, website: www.cia.gov/library/publications/the-world-factbook/index.htm, accessed on
March 23, 2010)

Structure of India’s Financial Services Industry

The RBI is the central regulatory and supervisory authority for the Indian financial system. SEBI and the Insurance
Regulatory and Development Authority (IRDA) regulate the capital markets and insurance sector, respectively. A
variety of financial intermediaries in the public and private sectors participate in India’s financial sector, including the
following:

• Commercial banks;
• NBFCs ;

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 • Specialized financial institutions like the National Bank for Agriculture and Rural Development
(NABARD), the Export-Import Bank of India (EXIM Bank), the Small Industries Development Bank of
India (SIDBI) and the Tourism Finance Corporation of India (TFCI);
• Securities brokers;
• Investment banks;
• Insurance companies;
• Mutual funds; and
• Venture capital funds.

Non-Banking Finance Companies (NBFCs)

Non-Banking Finance Companies (NBFCs) are an integral part of the country’s financial system, catering to a large
market of niche customers, and have emerged as one of the major purveyors of retail and SME credit in India. It is a
heterogeneous group of institutions (other than commercial and co-operative banks) performing financial intermediation
in a variety of ways, such as accepting deposits, making loans and advances, providing leasing/hire purchase services,
among others. There are over 12,000 NBFCs in India, (Source: Reserve Bank of India, Annual Report, August 2009)
mostly in the private sector.

The RBI defines an NBFC as a company registered under the Companies Act, 1956 and engaged in the business of loans
and advances, acquisition of shares, stock, bonds, debentures, and securities issued by the GoI or local government
authorities, or other securities of like marketable nature, leasing, hire-purchase, insurance business, chit business.
However, this excludes institutions whose principal business is in the agricultural or industrial sector, or in the sale,
purchase and construction of immovable property. A non-banking entity that has as its principal line of business the
receipt of deposits, under any scheme or arrangement, or the extension of loans, in any manner, is also considered an
NBFC.

Gradually, NBFCs have become recognized as complementary to the banking sector due to their customer-oriented
services, simplified procedures, attractive rates of return on deposits, flexibility and timeliness in meeting the credit
needs of specified sectors, among other reasons. NBFCs have traditionally extended credit across the country through
their widespread geographical presence, with NBFCs supplying credit in segments such as equipment leasing, hire
purchase, and consumer finance. These are areas which warrant infusion of financing due to the existing demand-supply
gap. NBFCs have provided a more flexible source of financing and have been able to disburse funds to a gamut of
clientele, from local individual customers to a variety of corporate clientele. NBFCs can be divided into deposit taking
NBFCs, i.e., those which accept deposits from the public and non-deposit taking NBFCs being those which do not accept
deposits from the public.

The activities carried out by NBFCs in India can be grouped as follows:

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 NBFC

Fund Based Activities Fee based Activities

• Equipment Leasing • Investment Banking
• Hire Purchase • Portfolio
• Bill Discounting Management
• Loans / Investments • Wealth Management
• Venture Capital • Corporate
• Factoring Consulting
• Equity Participation • Project Consulting
• Short Term Loans • Loan / Lease
• Inter Corporate Syndication
Loans • Advisory Services

Even though NBFCs perform functions similar to those of banks, there are a few differences:

(i) NBFCs cannot accept demand deposits;

(ii) NBFCs are not a part of the payment and settlement system and as such cannot allow their customers to operate
accounts through the issuance of cheques; and
(iii) Deposit insurance facility of Deposit Insurance and Credit Guarantee Corporation is not available for NBFC
depositors.

Initially, the NBFCs registered with the RBI could only operate as equipment leasing companies, hire purchase
companies, loan companies and investment companies. However, effective December 6, 2006, NBFCs registered with
the RBI have been reclassified as (i) asset finance companies (“AFCs”); (ii) investment companies (“IC”); and (iii) loan
companies (“LC”). Efforts have been made to integrate NBFCs into the mainstream financial sector by strengthening
the prudential guidelines relating to income recognition, asset classification and provisioning. A number of measures to
enhance the regulatory and supervisory standards of NBFCs in order to put them on par with commercial banks were
undertaken by the RBI over a period of time including the alignment of interest rates, allowing diversification of
businesses e.g. issuance of co-branded cards and distribution of mutual fund and insurance products, regulation of
systemically important NBFCs and introduction of a fair practices code and corporate governance.

Automotive Industry and Commercial Vehicles Overview

In terms of global scale, the Indian automotive industry is the second largest two-wheeler market in the world, the fourth
largest heavy commercial market in the world, and the eleventh largest passenger vehicle market in the world. As one of
the largest industrial sectors in India, turnover of the automotive industry represents roughly 5.0% of India’s GDP, while
contributing nearly 17.0% to total indirect taxes. Although the automotive industry provides direct and indirect
employment to over 13 million people, the penetration levels for vehicles in India are among the lowest in the world.
[Source: SIAM]

The commercial vehicle industry is segmented into “light commercial vehicles” (for vehicles with gross vehicle weight
of less than 7.5 tons) and “medium and heavy commercial vehicles” (for vehicles weighing more than 7.5 tons). The
performance of the medium and heavy commercial vehicle industry bears a high correlation with industrial growth, and
is driven by economic development, improved road infrastructure (such as the Golden Quadrilateral) for long haulage
transportation, and a favorable regulatory environment (in this regard, demand created in the years 2006-2007 was
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attributable to the strict enforcement of overloading restrictions and age norms). In turn, the performance of the light
commercial vehicle industry tends to be less cyclical in nature, and is driven by GDP growth and demand for last mile
distribution. The market share of light commercial vehicles increased rapidly - the introduction of a sub-one ton carrier
by certain players created a new segment typically occupied by three-wheelers and similar forms of intra-city transport,
resulting in significant growth in the commercial vehicle market as a whole.

Total domestic sales in the commercial vehicle industry reached 490,494 units in 2007-08. From 2003-04 to 2007-08,
domestic sales had grown at a healthy CAGR of 17.8%, dipping to 4.9% in 2007-08 from 33.3% in 2006-07. The
reduction in domestic sales was attributed to the slowdown in economic development, credit availability and costs, an
increase in fuel prices, in addition to the base effect due to the one-time demand created in 2006-07 by the strict
enforcement of overloading restrictions. [Source: SIAM]

Domestic Commercial Vehicle Sales Volumes

4.9%
CAGR 17.8% 33.3%
490,494
467,765
(21.7%)
10.2% 384,122
22.4% 351,041
318,430
260,114

2003-04 2004-05 2005-06 2006-07 2007-08 2008-09

Numbers in italics represent change over previous year

Source: Society of Indian Automobile Manufacturers ("SIAM")

After a stable second quarter in fiscal 2009, the automotive sector in India suffered severe contraction in demand in the
third quarter of fiscal 2009, arising from major financial and other market upheavals. This, along with contraction in
freight movement in many segments of the industry, led to a massive drop in the medium and heavy commercial vehicle
segment demand. High interest rates and peak commodity prices also affected the industry and the supply chain. In the
third quarter of fiscal 2009, industry commercial vehicle sales were down 44.0% and passenger vehicle sales dropped by
as much as 16.5% against the comparable quarter of the previous year. The economy grew 5.3% in the December 2008
quarter from a year earlier, below forecasts of 6.2% and the previous quarter's 7.6% as the global economic crisis cut
demand and exports. As a result, 2008-2009 volumes declined 21.7%.

Commercial Vehicle Domestic Sales 2003 to 2009

Category 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09

Light commercial 161,395 198,561 207,446 275,600 271,045 183,541
vehicles
Medium and heavy 98,719 119,877 143,237 247,040 250,361 200,581
commercial vehicles
Total Sales 260,114 318,438 350,683 522,640 521,406 384,122

Source: Society of Indian Automobile Manufacturers

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Through a series of coordinated and successive measures, the GoI announced an economic stimulus package which
included, inter alia, reductions in interest rates, stepping up of plan expenditure by up to US$5.00 billion by March
2009, easing the flow of credit, among other measures. There have also been announcements directly favoring the
automobile industry, including:

• an across-the-board cut of 4.0% in excise duties, allowing manufacturers to offer price cuts to consumers
thereby stimulating demand. A further 2% cut in excise duties was announced on February 24, 2009;

• accelerated depreciation of 50.0% for commercial vehicles to be purchased on or after January 1, 2009 to March
31, 2009. This was subsequently extended to September, 2009; and

• assistance to states under the GoI scheme (under the the Jawaharlal Nehru National Urban Renewal Mission
(JNNURM) of the Ministry of Urban Development) for the purchase of buses for their urban transport systems
as a one-time measure to June 30, 2009.

The impact of both the monetary and fiscal measures of the GoI has positively impacted volumes and there have been
encouraging signs of revival in demand since January, 2009. The overall commercial vehicle segment registered positive
growth at 5.4% during April-October 2009 as compared to the same period the previous year. While medium and heavy
commercial vehicle registered negative growth at (11.3%), the light commercial vehicle segment climbed to 22.7%.
(Source: Society of Indian Automobile Manufacturers)

Over the long term, the commercial vehicle industry and consequently, commercial vehicle financing, is expected to
continue to show growth in light of the following factors:

Modernization of trucking industry. A replacement boom is likely to be triggered by stricter enforcement of regulations
banning trucks beyond 15 years and overloading, as well as the introduction by transport associations of a voluntary
retirement scheme for old trucks with better financing options. An anticipated replacement demand for 1.1 million new
as well as pre-owned trucks will require financing of Rs.1,078.00 billion.

Structural shift to hub-and-spoke model and improving road infrastructure. All commercial vehicle segments are
expected to experience a boost from the fast-evolving hub- and spoke-structure of the freight industry. Long-distance
haulage between hubs is typically serviced by heavy commercial vehicle on highways which continue to benefit from the
Golden Quadrilateral and road development projects, with freight distribution from the hub to the local warehouse at the
end of the spoke requiring medium commercial vehicles and distribution over the last mile requiring small commercial
vehicles.

Stricter emission norms expected to generate huge demand for 5-12 year old trucks: Currently, Bharat Stage IV norms
(equivalent to Euro IV norms) are in force for four-wheelers in thirteen cities in India, while Bharat Stage III norms
(equivalent to Euro III norms) are in force in rest of India. A revision in emission regulations is expected to be
implemented by fiscal 2010, when the eleven major cities currently subject to Bharat Stage III norms are expected to
move to Bharat Stage IV norms (equivalent to Euro IV norms), with the rest of India to adopting Bharat Stage III norms.

Growing freight capacity. GDP growth rate continues to drive incremental freight capacity, which is estimated to
increase at 1.25 times of GDP growth.

Growth of construction industry. The share of the construction industry in GDP has increased from 6.1% in 2002-03 to
6.9% in 2006-07. This increase has been largely propelled by government spending. Because a substantial portion of
construction investment is spent on equipment, this construction boom heralds a similar expansion in the need for
construction vehicles. The Indian construction industry is dominated by small contractors that perform over 90.0% of
projects. These local players often lack adequate access to institutional finance, creating enormous opportunities in the
area of construction equipment financing. (Source: Government of India Planning Commission Eleventh Five Year Plan)

Government investments in the roads and highways sector

Government investments in the roads and highways sector may also be expected to support growth in the commercial
vehicle industry. According to the NHAI, India has the second largest road network in the world, aggregating
approximately 3.3 million kilometers. Approximately 65.0% of freight and 80.0% of passenger traffic is carried by the
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road network. The national highways, which carry approximately 40.0% of total road traffic, constitute only about 2.0%
of the total road network. Moreover, the number of vehicles has been increasing at an average pace of 10.2% per annum
over the last five years. (Source: NHAI, http://www.nhai.org/roadnetwork.htm)

The table below sets forth information pertaining to India's road network.

Indian Road Network Approximate Length (in km) Percentage of Total

Expressways 200 0.0%
National highways 70,548 2.1%
State highways 131,899 4.0%
Major district roads 467,763 14.1%
Village and other roads 2,650,000 79.8%
Total 3,320,410 100.0%
[Source: http://www.nhai.org/roadnetwork.htm, National Highways Authority of India (NHAI); as of October 29, 2009;
percentage computations added.]

Moreover, the GoI has recently announced plans for the proposed launch by NHAI of six significant projects in the roads
and highways sector, estimated at project costs in excess of U.S.$1.00 billion each. (Source: http://www.nhai.org, NHAI)

Commercial Vehicles Financing Overview

From 1995 to 1997, the commercial vehicle finance market was highly fragmented, with NBFCs dominating the
commercial vehicle finance market. Steady consolidation took place, with larger players like Sundaram Finance, Ashok
Leyland Finance, Citicorp Finance, GE Capital and others increasing their market position and share. In 2000 to 2001,
the new commercial vehicle finance market was estimated at around Rs.52.00 billion. The market became less
fragmented, as weaker NBFCs exited the market due to increasing pressure on margins. Private banks, capitalizing on
market opportunities, made an aggressive entry into the market. (Source: Report of CRISIL Research –“Retail Finance –
Auto – Annual Review”, January, 2010)

From 2003 to 2006, organized players began focusing on the used vehicle and refinance markets, which had traditionally
been serviced by the unorganized sector. NBFCs, such as Tata Finance, Sundaram Finance, Citicorp Finance, and
Cholamandalam Investment and Finance Company, accounted for about 34% of the market. In turn, banks like ICICI
Bank, HDFC Bank and Kotak Mahindra Bank emerged as strong players in the private bank segment, capturing about
57.0% of the market. State Bank of India, which expanded its operations in this market in 2003-2004, and other public-
sector and cooperative banks, accounted for the remaining 9%. To increase their market share, players required a sound
origination and distribution network, due to the market distribution across national and state highways. In 2005 to 2006,
the total organized commercial vehicle finance market was estimated at Rs.303.00 billion, with new commercial vehicle
market contributing Rs.196.00 billion and the used commercial vehicle market contributing Rs.107.00 billion. (Source:
Report of CRISIL Research –“Retail Finance – Auto – Annual Review”, January, 2010)

In the year 2007, two major deals between international truck makers and Indian companies were signed including
agreement to manufacture and sell light commercial vehicles between Nissan Motor Co. Limited and Ashok Leyland and
Eicher Motor’s joint venture with AB Volvo. During 2008-09, commercial vehicle was the worst hit segment in
automobile sector on account of reduction in freight availability and unfavourable credit environment. Rising defaults led
to deterioration in asset quality, with players curtailing their exposure to SFOs and FTUs. Government took several
initiatives to increase demand including reduction in excise duty and service tax by 2 percent and special credit line for
NBFCs. In 2009-10, our Company acquired Rs. 12 billion worth of commercial vehicle and construction equipment
assets from GE Capital’s transport finance business. (Source: Report of CRISIL Research –“Retail Finance – Auto –
Annual Review”, January, 2010)

Slowdown in industrial activity, unfavourable credit scenario and strained profitability for transporters had adversely
affected the commercial vehicle market. Lower growth in industrial production led to a reduction in freight availability
and capacity utilization levels which deteriorated transporters’ repayment capability and eventually, asset quality.
However, in 2009-10 interest rates for commercial vehicle finance fell by around 150 bps resulting into improved
liquidity in the financial system leading to a fall in cost of funds for the financiers and ultimately benefiting the

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customers in the form of lower interest rates. (Source: Report of CRISIL Research –“Retail Finance – Auto – Annual
Review”, January, 2010)

Although yield to financiers increased in 2008-09, gross spreads came down, as the cost of funds increased for a larger
extent. However, in 2009-10, yield to financier is estimated to have declined by 150-200 bps, which is more than the
reduction in cost of funds, due to decline in risk aversion and increase in competition among financiers. (Source: Report
of CRISIL Research –“Retail Finance – Auto – Annual Review”, January, 2010)

The new commercial vehicle financing market is estimated at Rs.232.00 billion in 2009-10 and is projected to grow by
12.4 percent in 2010-11, primarily led by boost in business and consumer confidence levels, revival in commercial
vehicle sales volume and decline in risk aversion among financiers. During 2008-09 to 2013-14, the industry is forecast
to grow at a 5-year CAGR of 13.2 percent, driven by economic growth and infrastructure development in the country.
(Source: Report of CRISIL Research –“Retail Finance – Auto – Annual Review”, January, 2010)

Apart from the Company, HDFC Bank, Kotak Mahindra Bank and Sundaram Finance are some of the key organized
players in the new vehicle financing segment. Some of the large players in the commercial vehicle financing industry,
e.g. Citi Financial, Centuria Bank of Punjab and GE Money, as also numerous small-sized players, have exited the
market, which has eased competitive intensity for other players like the Company.

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 OUR BUSINESS

Overview

We the largest asset financing NBFC, with a primary focus on financing pre-owned commercial vehicles*. We are
among the leading financing institutions in the organized sector for the commercial vehicle industry in India for FTUs
and SRTOs. We also provide financing for passenger commercial vehicles, multi-utility vehicles, three wheelers, tractors
and construction equipment. In addition, we provide ancillary equipment and vehicle parts finance, such as loans for
tyres and engine replacements, and provide working capital facility for FTUs and SRTOs. We also provide ancillary
financial services targeted at commercial vehicle operators such as freight bill discounting and also market co-branded
credit cards targeted at commercial vehicle operators in India, thereby providing comprehensive financing solutions to
the road logistics industry in India. In addition, we also provide personal loans to the existing customers.

* Based on financial and non financial parameters for the financial year 2009 for selected NBFCs as contained in the
D&B Research Report, [Source: Dun & Bradstreet Research Report]

Our Company was established in 1979 and we have a long track record of over three decades in the commercial vehicle
financing industry in India. The Company has been registered as a deposit-taking NBFC with the RBI since September
4, 2000 under Section 45IA of the Reserve Bank of India Act, 1934. We are a part of the Shriram group of companies
which has a strong presence in financial services in India, including commercial vehicle financing, consumer finance,
life and general insurance, stock broking, chit funds and distribution of financial products such as life and general
insurance products and mutual fund products, as well as a growing presence in other businesses such as property
development, engineering projects and information technology.

Our widespread network of branches across India has been a key driver of our growth over the years. As of December
31, 2009 we had 482 branches across India, including at most of the major commercial vehicle hubs along various road
transportation routes in India. We have also strategically expanded our marketing network and operations by entering
into partnership and co-financing arrangements with private financiers in the unorganized sector involved in commercial
vehicle financing. As of December 31, 2009 our total employee strength was approximately 12,823.

We have demonstrated consistent growth in our business and in our profitability. Our Assets Under Management*
includes loan assets in the books of the Company, assets that have been securitized / assigned by us and portfolio
managed by the Company under portfolio management arrangements with banks and other institutions from which we
receive fee income for the provision of client sourcing and collection activities. Our Assets Under Management* has
grown by a compounded annual growth rate, or CAGR*, of 38.87 % from Rs. 1,208,828.79 lacs (comprising Assets
Under Management in the books of the Company of Rs. 842,456.87 lacs, loan assets securitized/assigned of Rs.
314,054.92 lacs and portfolio managed by the Company* of Rs. 52,317.00 lacs) as of March 31, 2007 to Rs.
2,331,303.66 lacs (comprising Assets Under Management in the books of the Company of Rs. 1,795,590.15 lacs, loan
assets securitized/assigned of Rs. 531,092.91 lacs and portfolio managed by the Company* of Rs. 4,620.60lacs) as of
March 31, 2009. Our Assets Under Management as of December 31, 2009*, was Rs. 2,816,909.42 lacs (comprising
Assets Under Management in the books of the Company of Rs. 2,154,258.75 lacs, loan assets securitized /assigned of
Rs. 662,623.83 lacs and portfolio managed by the Company* of Rs. 26.84 lacs). Our capital adequacy ratio as of March
31, 2009 and December, 2009 was 16.35% and 17.07 %, respectively, compared to the RBI stipulated minimum
requirement of 12.00%. Our Tier I capital as of December 31, 2009 was Rs. 285,727.21 lacs. Our Gross NPAs as a
percentage of Total Loan Assets were 2.14% and 2.43 % as of March 31, 2009 and December 31, 2009 respectively. Our
Net NPAs as a percentage of Net Loan Assets was 0.83% and 0.67% as of March 31, 2009 and December 31, 2009,
respectively.

* Please note these figures are based on certificates provided by the management.

Our total income increased from Rs. 142,138.60 lacs in fiscal 2007 to Rs. 373,112.97 lacs in fiscal 2009, at a CAGR of
62.02%. Our net profit after tax increased from Rs. 19,039.71 lacs in fiscal 2007 to Rs. 61,240.21 lacs in fiscal 2009, at a
CAGR of 79.34%. In the nine months ended December 31, 2009, our total income and net profit after tax were Rs.
327,039.34 lacs and Rs. 60,868.68 lacs, respectively. A summary of our assets under management, total income and Net
profit after tax for the corresponding periods specified below are as follows*:

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Particulars As at March 31, 2007 As at March 31, 2008 As at March 31, 2009 As at December 31, 2009
Rs. In Lacs
Assets Under 1,208,828.79 1,954,383.01 2,331,303.66 2,816,909.42
Management
Net Non performing 11,015.70 13,553.78 14,746.53 14,274.45
assets
For the Financial Year For the Financial Year For the Financial Year For the Nine months
ended March 31, 2007 ended March 31, 2008 ended March 31, 2009 ended December 31, 2009
Total Income 142,138.60 250,902.68 373,112.97 327,039.34
Net Profit after Tax 19,039.71 38,982.65 61,240.21 60,868.68

Recent Developments

Allotment of Equity Shares pursuant to our Company’s ESOP scheme

On March 26, 2010 our Company has issued and allotted 1,084,700 Equity Shares at a price of Rs. 35 per Equity Share
pursuant to the exercise of stock options issued under our ESOP scheme. Our Company has made separate applications
all dated April 13, 2010, to MSE, NSE, and BSE in connection with obtaining approval therefrom, for trading of the
aforementioned Equity Shares. We have recevied approvals for the trading of the aforementioned Equity Shares from the
BSE and the MSE vide their letters dated April 19, 2010 and April 30, 2010, respectively. The approval from the NSE in
connection with the trading of the aforementioned Equity Shares is still awaited.

Allotment of Equity Shares pursuant to Chapter VIII of the Securities and Exchange Board of India (Issue of Capital and
Disclosure Requirements) Regulations, 2009

On January 28, 2010, our Company issued and allotted 11,658,552 Equity Shares of at a price of Rs.500.80 per such
Equity Share, aggregating to Rs. 58,386.03 lacs to Qualified Institutional Buyers pursuant to the provisions of Chapter
VIII of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as
amended.

Incorporation of a subsidiary of our Company

Shriram Automall India Limited, a subsidiary of our Company was incorporated pursuant to a certificate of incorporation
dated February 11, 2010 issued by the Registrar of Companies, Chennai, Tamil Nadu and is having its registered office
situated at 123, Angappa Naickan Street, Chennai 600001,Tamil Nadu, India.

Acquisition of Receivables Portfolio

Pursuant to the terms of an Assignment Agreement dated December 22, 2009 (the “Assignment Agreement”) between
the Company, GE Capital Services India and GE Capital Financial Services (collectively, the “GE Entities”), we have
acquired with effect from December 24, 2009 from the GE Entities, on a non-recourse basis, a certain portfolio of
receivables in connection with certain loan facilities relating to commercial vehicle loans and construction equipment
loans (the “GE Receivables”), together with all right, title and interest therein under the relevant underlying loan and
security documents relating to the GE Receivables as of November 28, 2009.

Our Strengths

We believe that the following are our key strengths:

The largest asset financing NBFC in India

We are the largest asset financing NBFC in India, with particular focus on financing pre-owned commercial vehicles*.
We primarily cater to FTUs and SRTOs and we believe we are among the leading financing institutions in the organized
sector in this particular segment. Our widespread network of 482 branches across India as of December 31, 2009 enables
us to access a large customer base including in most major and minor commercial vehicle hubs along various road
transportation routes in India. We believe that our widespread branch network enables us to service and support our
existing customers from proximate locations which provide customers easy access to our services. We have also
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strategically expanded our marketing and customer origination network by entering into partnership and co-financing
arrangements with private financiers involved in commercial vehicle financing. We believe our relationship with these
partners is a critical factor in sourcing new customers and enhancing reach and penetration at low upfront capital cost.
The relationships we have developed with our customers provide us with opportunities for repeat business and to cross
sell our other products as well as derive benefit from customer referrals.

* Based on financial and non financial parameters for the financial year 2009 for selected NBFCs as contained in the
D&B Reseacrch Report, [Source: Dun & Bradstreet Research Report]

Our Assets Under Management as of December 31, 2009*, was Rs. 2,816,909.42 lacs (comprising Assets Under
Management in the books of the Company of Rs. 2,154,258.75 lacs, loan assets securitized /assigned of Rs. 6,62,623.83
lacs and portfolio managed by the Company* of Rs. 26.84 lacs). This is supported by a strong capital base, with share
capital of Rs. 21,279.86 lacs and reserves and surplus of Rs. 286,716.43 lacs as of December 31, 2009. Our capital
adequacy ratio as of December 31, 2009 was 17.07%, compared to the RBI stipulated minimum requirement of 12.00%.
Our Tier I capital as of December 31, 2009 was Rs. 285,727.21 lacs.

* Please note these figures are based on certificates provided by the management.

Our Assets under Management as on May 5, 2010 is Rs. 30,052.63 crore, including assets in the books of our Company
of Rs. 19,253.93 crore and loan assets securitised/assigned of Rs. 10,798.70 crore.

Access to a range of cost effective funding sources

We fund our capital requirements through a variety of sources. Our fund requirements are currently predominantly
sourced through term loans from banks, issue of redeemable non-convertible debentures, and cash credit from banks
including working capital loans. We access funds from a number of credit providers, including nationalized banks,
private Indian banks and foreign banks, and our track record of prompt debt servicing has allowed us to establish and
maintain strong relationships with these financial institutions. We also place commercial paper and access inter-
corporate deposits. As a deposit-taking NBFC, we are also able to mobilize retail fixed deposits at competitive rates. We
have also raised subordinated loans eligible for Tier II capital. We undertake securitization/assignment transactions to
increase our capital adequacy ratio, increase the efficiency of our loan portfolio and as a cost effective source of funds.

In relation to our long-term debt instruments, we currently have ratings of CARE AA+ from Credit Analysis and
Research Ltd. (“CARE”) and AA (Ind) from FITCH. In relation to our short-term debt instruments, we have also
received ratings of F1+ from FITCH and P1+ from CRISIL. The Secured NCDs proposed to be issued under this Issue
have been rated ‘CARE AA+’ by CARE for an amount of upto Rs. 50,000 Lacs and ‘AA/Stable’ by CRISIL for an
amount of upto Rs. 50,000 Lacs vide their letters dated April 19, 2010 and April 27, 2010, respectively and the
Unsecured NCDs proposed to be issued under this Issue have been rated ‘CARE AA’ by CARE for an amount of upto
Rs. 50,000 Lacs and ‘AA/Stable’ by CRISIL for an amount of upto Rs. 50,000 Lacs vide their letters dated April 19,
2010 and April 27, 2010, respectively. We believe that we have been able to achieve a relatively stable cost of funds
despite the difficult conditions in the global and Indian economy in fiscal 2008 and 2009 and the resultant reduced
liquidity and an increase in interest rates, primarily due to our improved credit ratings, effective treasury management
and innovative fund raising programs. We believe we are able to borrow from a range of sources at competitive rates.

The RBI currently mandates domestic commercial banks operating in India to maintain an aggregate of 40.00% (32.00%
for foreign banks) of their advances or credit equivalent amount of off-balance sheet exposure, whichever is higher as
“priority sector advances”. These include advances to agriculture, small enterprises (including SRTOs, which constitute
the largest proportion of our loan portfolio), exports and similar sectors where the Government seeks to encourage flow
of credit for developmental reasons. Banks in India that have traditionally been constrained or unable to meet these
requirements organically, have relied on specialized institutions like us that are better positioned to or exclusively focus
on originating such assets through on-lending or purchase of assets or securitized/assigned pools to comply with these
targets. Our securitized/assigned asset pools are particularly attractive to these banks as such transactions provide them
with an avenue to increase their asset base through low cost investments and limited risk. Majority of our loan portfolio
being classified as priority sector lending also enables us to negotiate competitive interest rates with banks and other
financial institutions. In fiscal 2008 and 2009, the total book value of loan assets securitized/assigned was Rs.
211,822.17 lacs and Rs. 312,498.40 lacs, respectively. In the nine months ended December 31, 2009, the total book value
of loan assets securitized/assigned was Rs. 326,229.88 lacs.
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Unique business model and a track record of strong financial performance

We primarily cater to FTUs and SRTOs and we believe we are the only financing institution in the organized sector
providing finance to FTUs and SRTOs in the pre-owned commercial vehicle finance segment. Most of our customers are
not a focus segment for banks or other NBFCs as these customers lack substantial credit history and other financial
documentation on which many of such financial institutions rely to identify and target new customers. As the market for
commercial vehicle financing, especially the pre-owned commercial vehicle financing, is fragmented, we believe our
credit evaluation techniques, relationship based approach, extensive branch network and strong valuation skills make our
business model unique and sustainable as compared to other financiers. In particular, our internally-developed valuation
methodology requires deep knowledge and practical experience developed over a period of time, and we believe this is a
key strength that is difficult to replicate. We provide finance to pre-owned commercial vehicle operators at favourable
interest rates and repayment terms as compared to private financiers in the unorganized sector.

Our retail focus, stringent credit policies and relationship based model has helped us maintain relatively low NPA levels.
Our Gross NPAs as a percentage of Total Loan Assets were 2.14% and 2.43% as of March 31, 2009 and December 31,
2009 respectively. Our Net NPAs as a percentage of Net Loan Assets was 0.83% and 0.67% as of March 31, 2009 and
December 31, 2009, respectively.

Strong brand name

We believe that the "Shriram" brand is well established in commercial vehicle financing throughout India. We believe
that we are the only organized sector financing company with particular focus on the pre-owned commercial vehicle
financing segment to FTUs and SRTOs in India. Our targeted focus on and the otherwise fragmented nature of this
market segment, our widespread branch network, particularly in commercial vehicle hubs across India, as well as our
large customer base has enabled us to build a strong brand. Our efficient credit approval procedures, credit delivery
process and relationship-based loan administration and monitoring methodology have also aided in increasing customer
loyalty and earn repeat business and customer referrals.

Extensive experience and expertise in credit appraisal and collection processes

We have developed a unique business model that addresses the needs of a specific market segment with increasing
demand. We focus on closely monitoring our assets and borrowers through product executives who develop long-term
relationships with commercial vehicle operators, which enables us to capitalize on local knowledge. We follow stringent
credit policies, including limits on customer exposure, to ensure the asset quality of our loans and the security provided
for such loans. Further, we have nurtured a culture of accountability by making our product executives responsible for
loan administration and monitoring as well as recovery of the loans they originate.

Extensive expertise in asset valuation is a pre-requisite for any NBFC providing loans for pre-owned assets. Over the
years, we have developed expertise in valuing pre-owned vehicles, which enables us to accurately determine a
recoverable loan amount for commercial vehicle purchases. We believe a tested valuation technique for these assets is a
crucial entry barrier for others seeking to enter our market segment. Furthermore, our entire recovery and collection
operation is administered in-house and we do not outsource loan recovery and collection operations. We believe that our
loan recovery procedure is particularly well-suited to our target market in the commercial vehicle financing industry, as
reflected by our high loan recovery ratios compared to others in the financial services industry, and we believe that this
knowledge and relationship based recovery procedure is difficult to replicate in the short to medium term.

Experienced senior management team

Our Board consists of 10 Directors, including representatives of Newbridge India Investments II Ltd (TPG Group) , with
extensive experience in the automotive and/or financial services sectors. Our senior and middle management personnel
have significant experience and in-depth industry knowledge and expertise. Most of our senior management team has
grown with the Company and have more than 15 years of experience with us. Our management promotes a result-
oriented culture that rewards our employees on the basis of merit. In order to strengthen our credit appraisal and risk
management systems, and to develop and implement our credit policies, we have hired a number of senior managers who
have extensive experience in the Indian banking and financial services sector and in specialized lending finance firms

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providing loans to retail customers.. We believe that the in-depth industry knowledge and loyalty of our management and
professionals provide us with a distinct competitive advantage.

Our Strategies

Our key strategic priorities are as follows:

Further expand operations by growing our branch network and increasing partnership and co-financing
arrangements with private financiers

We intend to continue to strategically expand our operations in target markets that are large commercial vehicle hubs by
establishing additional branches. Our marketing and customer origination and servicing efforts strategically focus on
building long term relationships with our customers and address specific issues and local business requirements of
potential customers in a particular region. We also intend to increase our operations in certain regions in India where we
historically had relatively limited operations, such as in eastern and northern parts of India, and to further consolidate our
position and operations in western and southern parts of India.

The pre-owned commercial vehicle financing industry in India is dominated by private financiers in the unorganized
sector. We intend to continue to strategically expand our marketing and customer origination network by entering into
partnership and co-financing arrangements with private financiers across India involved in commercial vehicle financing.
In view of the personnel-intensive requirements of our operations, we continue to focus on growing our business by
increasingly relying on partnership arrangements to effectively leverage the local knowledge, infrastructure and
personnel base of our partners.

Introduce innovative marketing and sales initiatives and build our brand to further grow market share

We continue to develop innovative marketing and customer origination initiatives specifically targeted at FTUs and
SRTOs. For example, we organize "Truck Bazaars" in several commercial vehicle hubs in India every month.
Customarily the sale and purchase of pre-owned commercial vehicles is made through brokers or intermediaries, with
limited transparency and access to information and suitable opportunities. At our Truck Bazaars, we provide a
comprehensive platform for access to information about pre-owned commercial vehicles available for purchase and sale,
a venue for transporters to buy and sell pre-owned commercial vehicles directly without the intervention of brokers, and
a facility for providing advisory services for a fee on such transactions, together with access to our financing products.
This initiative enables us to develop long standing relationships with repeat customers, and provides us with
opportunities to generate new business. These programs provide a platform to increase our brand awareness and enable
us to promote our financing products.

We also intend to develop pre-owned commercial vehicle hubs across India called "Automalls", through a wholly-owned
subsidiary incorporated for this purpose, designed to provide a trading platform for the sale of pre-owned commercial
vehicles, showrooms for branded new and refurbished pre-owned commercial vehicles manufactured by various
manufacturers, as well as commercial vehicles repossessed by financing companies. Through our Automalls, we intend
to set up a one-stop shop catering to the various needs of commercial vehicle owners, including through the provision of
workshop facilities. We intend to provide electronic advertising and trading infrastructure in these Automalls, such as
touch-screen kiosks, through which customers will be able to access real-time information on pre-owned vehicles
available for sale. These electronic touch-screen kiosk facilities, which will also be installed in our branches, will
eventually replace our physical Truck Bazaar events. We intend to utilize our Automall platform for marketing of our
financial products and develop new customers. We intend to commence operation of such "Automalls" during the first
quarter of 2011, and to gradually expand to between 50 and 60 Automalls in the next 12 to 15 months.

Diversify our product portfolio

We intend to further develop our equipment finance business, particularly construction equipment. We believe that
infrastructure development and construction businesses are likely to benefit from the significant investment in
infrastructure by the Government of India and state governments and as well as by the private sector. Many of our
customers have upgraded themselves and have become a sub-contractor and we believe that the construction equipment
business segment will be a logical extention of our product portfolio for our existing customer base and with the global
meltdown many of the existing equipment financiers have stopped funding the construction equipment and vacuum is
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being created in the market so to tap the existing customer base and a new set of customers, we believe that the
construction equipment finance segment provides significant growth opportunity, and intend to increasingly focus on
construction equipment finance as a distinct business segment through our wholly owned subsidiary Shriram Equipment
Finance Company Limited. We are in the process of recruiting senior management and other personnel for this business
segment.

We are focused on leveraging our leadership in truck financing to expand our product portfolio, which now also includes
financing for passenger commercial vehicles, multi-utility vehicles, three-wheelers, tractors, and construction equipment.
We expect this will enable us to offer new products to existing customers and expand our customer base. These products
have strong synergies with the truck financing sector which is our primary business line. Further, by offering additional
downstream products, such as vehicle parts and other ancillary loans, credit cards and freight bill discounting, we
maintain contact with the customer throughout the product lifecycle and increase our revenues. The relationships we
have developed with our customers provide us with opportunities for repeat business and to cross sell our other products
and products of our affiliates.

Continue to implement advanced processes and systems

We have invested in our technology systems and processes to create a stronger organization and ensure good
management of customer credit quality. Our information technology strategy is designed to increase our operational and
managerial efficiency. We aim to increasingly use technology in streamlining our credit approval, administration and
monitoring processes to meet customer requirements on a real-time basis. We continue to implement technology led
processing systems to make our appraisal and collection processes more efficient, facilitate rapid delivery of credit to our
customers and augment the benefits of our relationship based approach. We also believe deploying strong technology
systems that will enable us to respond to market opportunities and challenges swiftly, improve the quality of services to
our customers, and improve our risk management capabilities.

Our Financial Products

Commercial Vehicle Finance

We are principally engaged in the business of providing commercial vehicle financing to FTUs and SRTOs. FTUs are
principally former truck drivers who purchase trucks for use in commercial operations and SRTOs are principally small
truck operators owning between one and four used commercial vehicles. Our financing products are principally targeted
at the financing of pre-owned trucks and other commercial vehicles, although we also provide financing for new
commercial vehicles. Pre-owned commercial vehicles financed by us are typically between five and 12 years old. We
also provide financing for other kinds of pre-owned and new commercial vehicles, including passenger vehicles, multi-
utility vehicles, tractors and three wheelers.

Ancillary Equipment and Vehicle Parts Finance

Our customers also require financing for the purchase of equipment and vehicle parts in connection with the operation of
their trucks and other commercial vehicles. We also offer financing for the acquisition of new and pre-owned vehicle
equipment and accessories, such as tyres, engines, chassis, and other vehicle parts.

Construction Equipment Finance

We provide finance for the purchase of construction equipments that are used in construction projects. Many of our FTU
and SRTO customers are increasingly entering the construction equipment business, and we believe that the construction
equipment business segment will be a logical extension of our product portfolio to our existing customer base. We
believe that this equipment finance segment provides significant growth opportunity and intend to increasingly focus on
construction equipment finance as a distinct business segment through our wholly-owned subsidiary Shriram Equipment
Finance Company Limited. We are in the process of recruiting senior management and other personnel for this business
segment. The majority of such customers will not be from our existing customer base.

Freight Bill Discounting

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As an extension of our product portfolio, we offer freight bill discounting services to our customers, including the
purchase of trucking invoices of our customers at a discount, thereby providing immediate cash relief to small truck
operators. Freight bill discounting provides our customers with their cash flow requirements without creating any debt,
which otherwise may restrict the ability of our customers from obtaining other necessary loans for vehicle or asset
financing. In addition, freight bill discounting frees truck operators from the need to attend to billing, collection and
settlement. With freight bill discounting, our decision to purchase receivables is based on the creditworthiness of the
freight customers and not that of the truck operators. Our industry experience and access to market intelligence enable us
to operate successfully in this business segment.

Credit Cards

We have entered into an agreement with Axis Bank (formerly UTI Bank Limited) to market co-branded Visa credit cards
to commercial vehicle operators for use in India and Nepal. We provide marketing assistance for the sourcing of
prospective customers for such credit cards as well as assist in customer verification procedures. Axis Bank however
retains the right to approve the application by any such customer. Access to such additional credit enables our customers
to meet their short term financial requirements, including working capital requirements.

Our Operations

Customer Origination

Customer Base

Our customer base is predominantly FTUs and SRTOs and other commercial vehicle operators, and smaller construction
equipment operators. We also provide trade finance to commercial vehicle operators. These customers typically have
limited access to bank loans for commercial vehicle financing and limited credit history. Our loans are secured by a
hypothecation of the asset financed.

Branch Network

As of December 31, 2009, we had a wide network of 482 branches across India and approximately 12,823 employees.
We have established branches at most major commercial vehicle hubs along various road transportation routes across
India. A typical branch comprises nine to 10 employees, including the branch manager. As of December 31, 2009, all of
our branch offices were connected to servers at our corporate office to enable real time information with respect to our
loan disbursement and recovery administration. Our customer origination efforts strategically focus on building long
term relationships with our customers, addresses specific issues and local business requirements of potential customers
in a specific region.

Partnership and Co-financing Arrangements with Private Financiers

SRTOs and FTUs generally have limited banking habits and credit history and inadequate legal documentation for
verification of credit worthiness. In addition, because of the mobile nature of the hypothecated assets, SRTOs and FTUs
have limited access to bank financing for pre-owned and new commercial vehicle financing. As a result, the pre-owned
truck financing market in India is dominated by private financiers in the unorganized sector. We have strategically
expanded our marketing and customer origination network by entering into partnership and co-financing arrangements
with private financiers across India involved in commercial vehicle financing.

We enter into strategic partnership agreements with private financiers ranging from individual financiers to small local
private financiers, including other NBFCs. We have established a stable relationship with our partners through our
extensive branch network. In view of the personnel-intensive requirements of our business model, we rely on
partnership arrangements to effectively leverage the local knowledge, infrastructure and personnel base of our partners.

Our partners source applications for pre-owned and new commercial vehicle financing based on certain assessment
criteria specified by us, and is generally responsible for ensuring the authenticity of the customer information and
documentation. The decision to approve a loan is, however, at our discretion. In the event that an application is rejected
by us, our partners are permitted to directly arrange financing for such customer or approach another financier in
connection with such proposed financing.
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Our partner sourcing a customer is responsible for obtaining all necessary documentation in connection with the loan
proposal. The partner is responsible for collection of installments and penalties for all customers originated through him.
The partner is also responsible for any repossession of vehicles and equipment in the event of a default of a loan by a
customer sourced by such partner.

A typical co-financing or partnership agreement stipulates the revenue-sharing ratio, amounts payable as quarterly
advance payments to our partner, and details related to the retention of earnest money. Specifically, we typically
stipulate a certain income-sharing arrangement on the interest on the loan, net of our cost of funding. Since the partner's
share of income is only determined upon settlement of the individual loan contracts, we typically release quarterly
advance payments to our partner. These payments are net of the earnest money deposit, which represents a pre-agreed
percentage of the partner's revenue share. We allocate the earnest money towards a loan loss pool, as well as for
business expansion purposes. Loan loss is typically calculated as our loss on principal and reimbursed expenses on loans
from customers sourced by the partner, with interest at the rate of our cost of funds. The loss is shared between the
parties in the same proportion as income. The parties usually stipulate that the amount available as earnest money deposit
in excess of a certain percentage of future receivables and may be withdrawn by the partner.

Other Marketing Initiatives

We continue to develop innovative marketing and customer origination initiatives specifically targeted at FTUs and
SRTOs. For example, we organize "Truck Bazaars" in several major commercial vehicle hubs in India every month.
Customarily the sale and purchase of pre-owned commercial vehicles is made through brokers or intermediaries, with
limited transparency and access to information and suitable opportunities. At our Truck Bazaars, we provide a
comprehensive platform for access to information about pre-owned commercial vehicles available for purchase and sale,
a venue for transporters to buy and sell pre-owned commercial vehicles directly without the intervention of brokers, as
well as a facility for providing advisory services for a fee on such transactions, together with access to our financing
products. This initiative enables us to develop long standing relationships with repeat customers, and provides us with
opportunities to generate new business. These programs provide us a platform to increase our brand awareness and
enable us to promote our financing products.

We also intend to develop pre-owned commercial vehicle hubs across India called "Automalls", through a wholly-owned
subsidiary which has been incorporated for this purpose, designed to provide a trading platform for the sale of pre-owned
commercial vehicles, showrooms for branded new and refurbished pre-owned commercial vehicles manufactured by
various manufacturers as well as commercial vehicles repossessed by financing companies.

Selling of refurbished repossessed vehicles will be undertaken by our Company under the brand name of ‘SHRIRAM
NEW LOOK’, for which company has made an application for registration. Through our Automalls, we intend to set up
one-stop shop facilities catering to the various needs of commercial vehicle owners, including through the provision of
workshops. We intend to provide electronic advertising and trading infrastructure in these Automalls, such as touch-
screen kiosks, through which customers will be able to access real-time information on pre-owned vehicles available for
sale. These electronic touch-screen kiosk facilities, which will also be installed in our branches, will eventually replace
our physical Truck Bazaar events. We intend to utilize this platform for marketing of our financial products and develop
new customers. We intend to commence operation of such "Automalls" during the first quarter of 2011, and to gradually
expand to between 50 and 60 Automalls in the next 12 to 15 months.

At present, second hand vehicles are being sold through the brokers and market is being controlled by them, our
Company intends to engage in auction of vehicles in an organized manner.

Branding/ advertising

We use the brand name “Shriram Transport Finance” for marketing our products pursuant to a license and user
agreement with Shriram Capital Limited (formerly Shriram Financial Services Holdings Private Limited), an affiliate
company which is valid until March 31, 2011. Our brand is well recognized in India given its association with the brand
of our promoter Shriram and our own efforts of brand promotion. We have launched various publicity campaigns
through print and other media specifically targeted at our target customer profile, FTUs and SRTOs, to create awareness
of our product features, including our speedy loan approval process with the intention of creating and enhancing our

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brand identity. We believe that our emphasis on brand promotion will be a significant contributor to our results of
operations in future.

Customer Evaluation, Credit Appraisal and Disbursement

Due to our customer profile, in addition to a credit evaluation of the borrower, we rely on guarantor arrangements, the
availability of security, referrals from existing relationships and close client relationships in order to manage our asset
quality. All customer origination and evaluation, loan disbursement, loan administration and monitoring as well as loan
recovery processes are carried out by our product executives. We do not utilize or engage direct selling or other
marketing and distribution agents or appraisers to carry out these processes. We follow certain procedures for the
evaluation of the creditworthiness of potential borrowers. The typical credit appraisal process is described below:

Initial Evaluation

When a customer is identified and the requisite information for a financing proposal is received, a branch manager or
product executive meets with such customer to assess the loan requirements and creditworthiness of such customer. The
proposal form requires the customer to provide information on the age, address, employment details and annual income
of the customer, as well as information on outstanding loans and the number of commercial vehicles owned. The
applicant is required to provide proof of identification and residence for verification purposes. In connection with the
loan application, the applicant is also required to furnish a guarantor, typically another commercial vehicle owner, and
preferably an existing or former customer. Detailed information relating to such guarantor is also required to be
provided.

For pre-owned commercial vehicles or equipment, a vehicle inspection and evaluation report is prepared by our
executives to ascertain, among other matters, the registration details of the vehicle, as well as its condition and market
value. A field investigation report is also prepared relating to the place of residence and of various movable and
immovable properties of the applicant and the guarantor. Each application also requires two independent references to
be provided.

Credit policies

We follow stringent credit policies to ensure the asset quality of our loans and the security provided for such loans. Any
deviation from such credit policies in connection with a loan application requires prior approval. Our credit policies
include the following:

• Vehicle type. We only finance vehicles that are used for commercial purposes. As these are income-generating
assets, we believe that this asset type reduces our credit risk.

• Guarantor requirement. Loans must be secured by the personal guarantee of the borrower as well as at least
one third party guarantor. The guarantor must be a commercial vehicle owner, preferably our existing or former
customer, and preferably operating in the same locality as the borrower.

• Loan approval guidelines. From time to time, our management lays down loan approval parameters which are
typically linked to the value of the vehicle/s.

• Age limit for used vehicles. We only extend loans to vehicles that are less than 12 years old.

• Period. In case of pre-owned commercial vehicles, the repayment term ranges between 24 and 48 months. For
new commercial vehicles, the repayment term ranges between 36 and 60 months.

• Prepayment charges. The borrower is charged prepayment charges in the event of termination of the loan by
prepayment.

• Release of documents on full repayment. Security received from the borrower, including unutilized post-dated
cheques, if any, is released on repayment of all dues or on collection of the entire outstanding loan amount,
provided no other existing right or lien for any other claim exists against the borrower.

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 • RTO records. In case of used vehicle financing, Regional Transport Office (“RTO”) records must be inspected
for non-payment of road tax, pending court cases, and other issues, and the records retained as part of the loan
documentation.

• Physical inspection and trade reference. In case of all pre-owned vehicle financing, the branch manager must
physically inspect the vehicle and assess its value. The branch manager’s determination regarding the condition
of the vehicle is recorded in the evaluation report of the vehicle. The branch manager must also conduct contact
point verification as well as a trade reference check of the borrower before an actual disbursement is made, and
such determination is recorded in the proposal evaluation records.

Approval Process

The branch manager evaluates the loan proposal based on supporting documentation and various other factors. The
primary criterion for approval of a loan proposal is based on the guarantee provided by another commercial vehicle
operator, preferably an existing or previous customer, as well as the valuation of the asset to be secured by the loan. In
addition, our branch managers may also consider other factors in the approval process such as length of residence, past
repayment record and income sources.

The branch manager is authorized to approve a loan if the proposal meets the criterion established for the approval of a
loan. The applicant is intimated of the outcome of the approval process, as well as the amount of loan approved, the
terms and conditions of such financing, including the rate of interest (annualized) and the application of such interest
during the tenure of the loan.

Disbursement

Margin money and other charges are collected prior to loan disbursements. The disbursing officer retains evidence of the
applicant’s acceptance of the terms and conditions of the loan as part of the loan documentation. A chassis print of the
vehicle is also obtained and maintained in the loan file. The relevant RTO endorsement forms are also required to be
executed by the borrower prior to the disbursement of the loan. Prior to the loan disbursement, the loan officer ensures
that a Know Your Customer checklist is completed by the applicant. The loan officer verifies such information provided
and includes such records in the relevant loan file. The loan officer is also required to ensure that the contents of the loan
documents are explained in detail to the borrower either in English or in the local language of the borrower, and a
statement to such effect is included as part of the loan documentation. The borrower is provided with a copy of the loan
documents executed by him. Although our customers have the option of making payments by cash or cheque, we may
require the applicant to submit post-dated cheques covering an initial period prior to any loan disbursement. For used
vehicles, an endorsement of the registration certificate as well as the insurance policy must be executed in our favor.

Loan administration and monitoring

The borrower and the relevant guarantor are required to execute a standard form of Loan cum Hypothecation Agreement
setting out the terms of the loan. A loan repayment schedule is attached as a schedule to the Loan cum Hypothecation
Agreement, which generally sets out monthly repayment terms. The Loan cum Hypothecation Agreement also requires a
promissory note to be executed containing an unconditional promise of payment to be signed by both the borrower and
the relevant guarantor. A power of attorney authorizing, among others, the repossession of the hypothecated vehicle
upon loan payment default, is also required to be executed.

We provide three payment options: cash, cheques or demand drafts. Repayments are made in monthly installments.
Loans disbursed are recovered from the customer in accordance with the loan terms and conditions agreed with the
customer. As a service to our customers our product executives offer to visit the customers on the payment date to collect
the installments due. We track loan repayment schedules of our customers, on a monthly basis, based on the outstanding
tenure of the loans, the number of installments due and defaults committed, if any. This data is analyzed based on the
vehicles financed and location of the customer.

Our MIS department and centralized operating team monitors compliance with the terms and conditions for credit
facilities. We monitor the completeness of documentation, creation of security etc. through regular visits to the branches
by our regional as well as head office executives and internal auditors. All borrower accounts are reviewed at least once
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a year, with a higher frequency for the larger exposures and delinquent borrowers. The branch managers review
collections regularly, and personally contact borrowers that have defaulted on their loan payments. Branch managers are
assisted by a set of product executives in the day-to-day operations, who are typically responsible for the collection of
installments from 150 to 200 borrowers each, depending on territorial dispersal. Each branch customarily limits its
commercial vehicle financing loans to approximately 1,000 customers, which enables closer monitoring of receivables.
A new branch is opened to handle additional customers beyond such limit to ensure appropriate risk management. Close
monitoring of debt servicing efficiency enables us to maintain high recovery ratios.

Collection and Recovery

We believe that our loan recovery procedure is particularly well-suited to our target market in the commercial vehicle
financing industry, as reflected by our high loan recovery ratios compared to the average in the financial services
industry. The entire collection operation is administered in-house and we do not outsource loan recovery and collection
operations. In case of default, the reasons for the default are identified by the local product executive and appropriate
action is initiated, such as requiring partial repayment and/or seeking additional guarantees or collateral.

In the event of a default on three loan installments, the branch manager is required to make a personal visit to the
borrower to determine the gravity of the loan recovery problem and in order to exert personal pressure on the borrower.

We may initiate the process for repossession of the vehicle in the event of a default. Branch managers are trained to
repossess vehicles and no external agency is involved in such repossession. Repossessed vehicles are held at designated
secured facilities for eventual sale. The notice to the customer specifies the outstanding amount to be paid within a
specified period, failing which the vehicle may be disposed of through auction. In the event there is a short fall in the
recovery of the outstanding amount from the sale of the vehicle, legal proceedings against the customer may be initiated.
Our loan asset reconstruction department co-ordinates with our legal team and external lawyers to initiate and monitor
legal proceedings wherever appropriate.

The laws governing the registration of motor vehicles in India effectively establish vehicle ownership, as well as the
claims of lenders. As a result, vehicle repossession in the event of default is a relatively uncomplicated procedure, such
that the possibility of repossession provides an effective deterrent against default.

Asset Quality

We maintain our asset quality through the establishment of prudent credit norms, the application of stringent credit
evaluation tools, limiting customer and vehicle exposure, and direct interaction with customers. In addition to our credit
evaluation and recovery mechanism, our asset-backed lending model and adequate asset cover has helped maintain low
gross and net NPA levels. We provide finance to pre-owned commercial vehicle operators at a lower interest rate
compared to that provided by private financiers, making repayment more manageable for FTUs and SRTOs.

Classification of Assets

The Prudential Norms Directions, 2007, read with the NBFC Acceptance of Public Deposits Directions, 1998, as
amended, prescribed by the RBI, among other matters, require us to observe the classification of our asset; treatment of
NPAs; and provisioning against NPAs.

Each deposit-accepting NBFC is required to classify its lease/hire purchase assets, loans, advances and other forms of
credit into the following classes, namely:

Standard assets. An asset in respect of which no default in repayment of principal or payment of interest is perceived and
which does not disclose any problem nor carry more than normal risk attached to the business.

Sub-standard assets. An asset will be classified as an NPA for a period not exceeding 18 months or where the terms of
the agreement regarding interest and / or principal have been renegotiated or rescheduled after commencement of
operations, until the expiry of one year of satisfactory performance under the renegotiated or rescheduled terms.

Doubtful assets. An asset which remains a sub-standard asset for a period exceeding 18 months.

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Loss assets. An asset which has been identified as loss asset by the NBFC or its internal or external auditor or by the RBI
during the inspection of the NBFC, to the extent that it is not written off by the NBFC; and (b) an asset which is
adversely affected by a potential threat of non-recoverability due to either erosion in the value of security or non
availability of security or due to any fraudulent act or omission on the part of the borrower.

For further information on the Prudential Norms Directions, 2007, see “Regulations and Policies”.

Provisioning and Write-offs

The Company is required, after taking into account the time lag between an account becoming non-performing, and its
recognition as such, the realization of the security, and the erosion of over time in value of the security charged, to make
provisions against sub-standard, doubtful and loan assets as per the directions issued by RBI. We also consider field
reports and collection patterns at regular intervals to anticipate the need of higher provisioning. Set out below is a brief
description of applicable RBI Guidelines on provisioning and write-offs for loans, advances and other credit facilities
including bills purchased and discounted:

Loans, advances and other credit facilities

Sub-standard assets: A general provision of 10.0% of the total outstanding assets is required to be made.

Doubtful assets: 100.0% provision to the extent to which the advance is not covered by the realizable value of the
security to which the NBFC has a valid recourse is required to be made. The realizable value is to be estimated on a
realistic basis. In addition to the foregoing, depending upon the period for which the asset has remained doubtful,
provision is required to be made as follows:

• if the asset has been considered doubtful for up to one year, provision to the extent of 20.0% of the secured
portion is required to be made;

• if the asset has been considered doubtful for one to three years, provision to the extent of 30.0% of the secured
portion is required to be made; and

• if the asset has been considered doubtful for more than three years, provision to the extent of 50.0% of the
secured portion is required to be made.

Loss assets: The entire asset is required to be written off. If the assets are permitted to remain in the books for any
reason, 100.0% of the outstanding assets should be provided for.

Lease and hire purchase assets: In respect of hire purchase assets, the total dues (overdue and future installments taken
collectively) as reduced by (i) the finance charges not credited in our profit and loss account and carried forward as
unmatured finance charges, and (ii) the depreciated value of the underlying asset, are required to be provided for.

Our Audit Committee has constituted a policy for making provisions in excess of the amounts prescribed by RBI and we
may make further provisions if we determine that it is prudent for a known and identified risk. Based on our policy our
provisions as of December 31, 2009 stood at Rs. 38,059.42 lacs as compared to the RBI required provision of Rs.
23,011.53 lacs.

The following table sets forth, as of the dates indicated, data regarding our NPAs:
Period Gross NPA (Rs. Net NPA (Rs. in Total Loan Assets Net Loan % of Gross % of Net NPA
in lacs) lacs) (Rs. in lacs) Assets(1) (Rs. NPA to Total to Net Loan
in lacs) Loan Assets Assets

March 31, 2007 17,404.19 11,015.70 841,136.17 834,747.68 2.07% 1.32%

March 31, 2008 23,843.32 13,553.78 1,514,012.86 1,503,723.32 1.57% 0.90%
March 31, 2009 38,411.39 14,746.53 1,795,350.47 1,771,685.61 2.14% 0.83%
December 31, 2009 52,303.87 14,274.45 2,154,250.82 2,116,221.40 2.43% 0.67%
Note: The information above excludes securitized/assigned assets.
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(1) Net Loan Assets means Total Loan Assets as adjusted for provisions made.

Our Gross NPAs as a percentage of Total Loan Assets were 2.14% and 2.43% as of March 31, 2009 and December 31,
2009 respectively. Our Net NPAs as a percentage of Net Loan Assets was 0.83% and 0.67% as of March 31, 2009 and
December 31, 2009, respectively. We believe that our eventual write-offs are relatively low because of our relationship
based customer origination and customer support, prudent loan approval processes, including adequate collateral being
obtained and our ability to repossess and dispose of such collateral in a timely manner.

Funding Sources

We have expanded our sources of funds in order to reduce our funding costs, protect interest margins and maintain a
diverse funding portfolio that will enable us to achieve funding stability and liquidity. Our sources of funding comprise
term loans including term loans from banks and financial institutions, cash credit from banks, redeemable non-
convertible debentures, subordinated bonds, short term commercial paper, public deposits, and inter-corporate deposits,.

Borrowings

The following table sets forth the principal components of our secured loans as of the dates indicated:

As of March 31, As of Dcember 31

Secured loans 2007 2008 2009 2009

(Rupees in lacs)

Redeemable non-convertible debentures 183,799.02 312,255.20 482,679.34 553,229.53

Term loans:
- Term loans from banks 259,825.48 505,329.28 833,363.58 972,557.48
- Term loans from financial institutions, foreign institutions
and corporates 82,272.73 111,263.73 44,792.69 40,277.57

Cash credit from banks including working capital demand 104,118.36 225,646.66 316,623.70 348,910.53
loans

The following table sets forth the principal components of our unsecured loans as of the dates indicated:

As of March 31, As of
December 31,
(Rupees in lacs)
Unsecured loans 2007 2008 2009 2009

(Rupees in lacs)

Fixed deposits 1,105.73 342.00 488.44 8,290.59

Inter-corporate deposits 30.00 120.64 4,657.16 24.95
Subordinated debt 68,443.43 98,959.81 154,776.25 191,682.41
Redeemable non-convertible debentures 13,000.00 3,800.00 2,500.00 2,500.00
Commercial paper 34,000.00 21,695.00 48,250.00 2,500.00
Term loans:
- Term loans from banks 75,750.00 151,890.38 53,000.00 100,639.54
- Term loans from corporates 47,166.10 46,000.00 71,000.00 35,000.00

Increasingly, we have depended on term loans from banks and the issue of redeemable non-convertible debentures as the
primary sources of our funding. We believe that we have developed stable long term relationships with our lenders, and
established a track record of timely servicing of our debts, and have been able to secure fixed rate long term loans of
three to five years tenure to stabilize our cost of borrowings. We have gradually decreased our dependence on public
deposits as a source of funds in order to lower our cost of funds.

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In fiscal 2008 and 2009, proceeds from bank borrowings (net of repayments) was Rs. 443,172.48 lacs and Rs.
320,120.96 lacs, respectively. In the nine months ended December 31, 2009, proceeds from bank borrowings was Rs
219,120.27lacs. As of March 31, 2009, secured loans from banks aggregated Rs. 833,363.58 lacs, as compared to Rs.
505,329.28 lacs as of March 31, 2008, while as of December 31, 2009, total secured loans from banks was Rs.
972,557.48 lacs.

In fiscal 2008 and 2009, proceeds from issuance of redeemable non-convertible debentures (net of redemptions) was Rs.
119,111.61 lacs and Rs. 169,124.14 lacs, respectively. In the nine months ended December 31, 2009, proceeds from
issuance of redeemable non-convertible debentures (net of redemptions) was Rs. 70,550.19 lacs. As of March 31, 2009,
secured redeemable non-convertible debentures was Rs. 482,679.34 lacs as compared to Rs. 312,255.20 lacs as of March
31, 2008, while as of December 31, 2009, secured redeemable non-convertible debentures outstanding was Rs.
553,229.53 lacs.

Our short term fund requirements are primarily funded by cash credit from banks including working capital loans. Cash
credit from banks including working capital loans outstanding as of March 31, 2008 and 2009 was Rs. 2,25,646.66 lacs
and Rs. 3,16,623.70 lacs. As of December 31, 2009, cash credit from banks including working capital loans outstanding
was Rs. 348,910.53 lacs.

As of December 31, 2009, our outstanding subordinated debt amounted to Rs. 191,682.41 lacs, compared to Rs.
98,959.81 lacs and Rs. 154,776.25 lacs as of March 31, 2008 and 2009, respectively. The debt is subordinated to our
present and future senior indebtedness. Based on the balance term to maturity, as of December 31, 2009, Rs. 123,705.81
lacs of the discounted book value of subordinated debt is considered as Tier II under the guidelines issued by the RBI for
the purpose of capital adequacy computation.

As of December 31, 2009, outstanding commercial paper amounted to Rs. 2,500 lacs as compared to Rs. 21695.00 lacs
and Rs. 48,250.00 lacs as of March 31, 2008 and 2009, respectively.

We are registered as a deposit-taking NBFC with the RBI under Section 45IA of the Reserve Bank of India Act, 1934,
which authorizes us to accept deposits from the public. We do not, however, depend on deposits as our primary source
of funding. As of November 30, 2009, our deposits were rated tAA(Ind) by Fitch. As of December 31, 2009, we had
fixed deposits outstanding of Rs. 8290.59 lacs, compared to Rs. 342.00 lacs and Rs. 488.44 lacs as of March 31, 2008
and 2009, respectively.

We also avail inter-corporate deposits from time to time. As of December 31, 2009, outstanding inter-corporate deposits
amounted to Rs. 24.95 lacs as compared to Rs. 120.64 lacs and Rs.4,657.16 lacs as of March 31, 2008 and 2009,
respectively.

Securitization/assignment of Portfolio against financing activities

We also undertake securitization/assignment transactions to increase our capital adequacy ratio, increase the efficiency
of our loan portfolio and as a cost effective source of funds. We sell part of our assets under financing activities from
time to time through securitization/assignment transactions as well as direct assignment. Our securitization/assignment
transactions involve provision of additional collateral and deposits or bank/ corporate guarantee. We carried out our first
securitization/assignment transaction of Rs. 443.12 lacs in February 2000 and since then we have completed 149 more
transactions with an aggregate value of Rs. 1,277,711.75 lacs. In fiscal 2008 and 2009, total book value of loan assets
securitized/assigned was Rs. 211,822.17 lacs and Rs. 312,498.40 lacs, respectively. In the nine months ended December
31, 2009, the total book value of loan assets securitized/assigned was Rs. 326,229.88 lacs.

We continue to provide administration services for the securitized/assigned portfolio, the expenses for which are
provided for, at the outset of each transaction. The gains arising out of securitization/assignment, which vary according
to a number of factors such as the tenor of the securitized/assigned portfolio, the yield on the portfolio
securitized/assigned and the discounting rate applied, are treated as income.

The following tables set forth certain information with respect to our securitization/assignment transactions:

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 For the Year ended March 31, For the Nine months ended
December 31,

2007 2008 2009 2009

(Rupees in lacs)

Total number of loan assets securitized/assigned 68,204 65,020 149,860 140,532

Total book value of loan assets securitized/assigned
285,979.49 211,822.17 312,498.40 326,229.88
Sale consideration received for securitized/assigned
assets 311,095.04 248,140.60 338,334.83 372,295.43
Gain on account of securitization/assignment 29,070.05 36,318.39 41,816.19 79,562.73

As of March 31, As of
December 31,

2007 2008 2009 2009

(Rupees in lacs)

Outstanding credit enhancement 31,095.67 56,687.05 97,459.32 152,736.05

Outstanding liquidity facility 2,236.77 7,127.85 17,137.30 25,976.51
Outstanding subordinate contribution 6,199.80 5,159.40 3,301.71 3,145.49

We are required to provide a credit enhancement for the securitization/assignment transactions by way of either fixed
deposits or corporate guarantees and the aggregate credit enhancement amount outstanding as on December 31, 2009
was Rs. 152,736.05 lacs. In the event a relevant bank or institution does not realize the receivables due under such loan
assets, such bank or institution would have recourse to such credit enhancement.

Treasury Operations

Our treasury operations are mainly focused on meeting our funding requirements and managing short term surpluses.
Our fund requirements are currently predominantly sourced through loans and by issue of debentures to banks, financial
institutions and mutual funds. We also place commercial paper and mobilize retail fixed deposits and inter-corporate
deposits. We have also raised subordinated loans eligible for Tier II capital. We believe that through our treasury
operations, we maintain our ability to repay borrowings as they mature and obtain new loans at competitive rates.

Our treasury department undertakes liquidity management by seeking to maintain an optimum level of liquidity and
complying with the RBI requirement of asset liability management. The objective is to ensure the smooth functioning of
all our branches and at the same time avoid the holding of excessive cash. Our treasury maintains a balance between
interest-earning liquid assets and cash to optimize earnings.

Our treasury department also manages the collection and disbursement activities from our head office in Mumbai. We
actively manage our cash and funds flow using various cash management services provided by banks. As part of our
treasury activities, we also invest our surplus fund in fixed deposits with banks, liquid debt-based mutual funds and
government securities. Our investments are made in accordance with the investment policy approved by the Board.

Our investments are predominantly in government securities and certificates of deposits with banks.

Capital Adequacy

We are subject to the capital adequacy ratio (“CAR”) requirements prescribed by the RBI. We are currently required to
maintain a minimum CAR of 12.00%, as prescribed under the Prudential Norms Directions, 2007, based on our total
capital to risk-weighted assets. As a part of our governance policy, we ordinarily maintain capital adequacy higher than
the statutorily prescribed CAR. As of December 31, 2009, our capital adequacy ratio was 17.07%, compared to the
minimum capital adequacy requirement of 12.00%stipulated by the RBI.

The following table sets out our capital adequacy ratios as of the dates indicated:

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 As of
As of March 31, December 31,

2007 2008 2009 2009

Capital adequacy ratio......................................................................................................................

13.63% 12.71% 16.35% 17.07%
Tier 1 capital………………………………………………………………… 10.25% 9.84% 11.13% 12.15%

Competition

We believe that we do not face any significant competition from organized players in our principal business line, the pre-
owned commercial vehicle financing sector. Most of our customers are not a focus segment for banks or large NBFCs, as
these customers lack substantial credit history and other financial documentation on which many of such financial
institutions rely to identify and target new customers. Our experience-based valuation methodology, our expanding
product portfolio, growing customer base and relationship-based approach are key competitive advantages against new
market entrants. Our primary competition is presented by private unorganized financiers that principally operate in the
local market. These private operators have significant local market expertise, but lack brand image and organizational
structure. The small private financiers also have limited access to funds and may not be able to compete with us on
interest rates extended to borrowers, which we are able to maintain at competitive levels because of our access to a
variety of comparatively lower cost of funding sources and operational efficiencies from our scale of operations.
However, private operators may attract certain clients who are unable to otherwise comply with our loan requirements,
such as the absence of an acceptable guarantor or failure of the commercial vehicle to meet our asset valuation
benchmarks. For new commercial vehicle financing, we compete with more conventional lenders, such as banks and
other NBFCs.

Given the relatively minimal scale of our present operations in our other business lines, we do not directly compete with
others in these segments. However, as our operations in our other business lines expand, we may face significant
competition in these segments in future.

Credit Rating

The following table sets forth certain information with respect to our credit ratings as of April 30, 2010:

Rating Limit in Rs. Lacs

Fitch Fixed Deposit tAA(Ind) 588
Fitch Non-convertible Debenture AA (Ind) 450,000
CARE Non-convertible Debenture AA+ 255,000
Fitch Short term F1+(Ind) 150,000
CRISIL Short term P1+ 200,000
CARE Subordinated Debt AA 160,000
Fitch Subordinated Debt AA (Ind) 120,000
CRISIL Non-Convertible Debenture AA/Stable 50,000
CRISIL Subordinated Debt AA/Stable 50,000
CRISIL Fixed Deposit FAA+/Stable -

The Secured NCDs proposed to be issued under this Issue have been rated ‘CARE AA+’ by CARE for an amount of
upto Rs. 50,000 Lacs and ‘AA/Stable’ by CRISIL for an amount of upto Rs. 50,000 Lacs vide their letters dated April
19, 2010 and April 27, 2010, respectively, and the Unsecured NCDs proposed to be issued under this Issue have been
rated ‘CARE AA’ by CARE for an amount of upto Rs. 50,000 Lacs and ‘AA/Stable’ by CRISIL for an amount of upto
Rs. 50,000 Lacs vide their letters dated April 19, 2010 and April 27, 2010, respectively.

Risk Management

We have developed a strong risk-assessment model in order to maintain healthy asset quality. The key risks and risk-
mitigation principles we apply to address these risks are summarized below:

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Interest Rate Risk

Our results of operations are dependent upon the level of our net interest margins. Net interest income is the difference
between our interest income and interest expense. Since our balance sheet consists of rupee assets and predominantly
rupee liabilities, movements in domestic interest rates constitute the primary source of interest rate risk. We assess and
manage the interest rate risk on our balance sheet through the process of asset liability management. We borrow funds at
fixed and floating rates of interest, while we extend credit at fixed rates. In the absence of proper planning and in a
market where liquidity is limited, our net interest margin may decline, which may impact our revenues and ability to
exploit business opportunities.

We have developed stable long term relationships with our lenders, and established a track record of timely servicing our
debts. This has enabled us to become a preferred customer with most of the major banks and financial institutions with
whom we do business. Moreover, our valuation capabilities enable us to invest in good quality assets with stable,
attractive yields. Significantly, our loans are classified as priority sector assets by the RBI, such that these loans, when
securitized, find a ready market with various financial institutions, including our lenders.

Liquidity Risk

Liquidity risk arises due to non-availability of adequate funds or non-availability of adequate funds at an appropriate
cost, or of appropriate tenure, to meet our business requirements. This risk is minimized through a mix of strategies,
including asset securitization/assignment and temporary asset liability gap.

We monitor liquidity risk through our asset liability management (“ALM”) function with the help of liquidity gap
reports. This involves the categorization of all assets and liabilities into different maturity profiles, and evaluating these
items for any mismatches in any particular maturities, especially in the short-term. The ALM policy has capped the
maximum mismatches in the various maturities in line with RBI guidelines and ALCO guidelines.

To address liquidity risk, we have developed expertise in mobilizing long-term and short-term funds at competitive
interest rates, according to the requirements of the situation. For instance, we structure our indebtedness to adequately
cover the average three-year tenure of loans we extend. As a matter of practice, we generally do not deploy funds raised
from short term borrowing for long term lending.

Credit risk

Credit risk is the risk of loss that may occur from the default by our customers under the loan agreements with us. As
discussed above, borrower defaults and inadequate collateral may lead to higher NPAs.

We minimize credit risk by requiring that each loan must be guaranteed by another commercial vehicle operator in the
same locality as the borrower, preferably by an existing or former borrower. Furthermore, we lend on a relationship-
based model, and our high loan recovery ratios indicates the effectiveness of this approach for our target customer base.
We also employ advanced credit assessment procedures, which include verifying the identity and checking references of
the proposed customer thoroughly at the lead generation stage. Our extensive local presence also enables us to maintain
regular direct contact with our customers. In this regard, we assign personal responsibility to each member of the lead
generation team for the timely recovery of the loans they originate, closely monitoring their performance against our
Company's standards, and maintain client and truck-wise exposure limits.

Cash management risk

Our branches collect and deposit approximately two-thirds of our customers' payments in cash. Lack of proper cash
management practices could lead to losses. To address cash management risks, we have developed advanced cash
management checks that we employ at every level to track and tally accounts. Moreover, we conduct regular audits to
ensure the highest levels of compliance with our cash management systems.

Employees

As of December 31, 2009 our total employee strength was approximately 12,823.

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We have built a highly capable workforce primarily by recruiting and hiring fresh graduates. As our business model
does not require extensive background in banking or the financial services industry, we prefer to hire and train fresh
graduates in the particular operational aspects of our business. Moreover, we prefer to hire our workforce from the
locality in which they will operate, in order to benefit from their knowledge of the local culture, language, preferences
and territory. We emphasize both classroom training and on-the-job skills acquisition. Post recruitment, an employee
undergoes induction training to gain an understanding of the Company and our operations. Our product executives are
responsible for customer origination, loan administration and monitoring as well as loan recovery and this enables them
to develop strong relationships with our customers. We believe our transparent organizational structure ensures efficient
communication and feedback and drives our performance-driven work culture.

In a business where personal relationships are an important driver of growth, product executive attrition may lead to loss
of business. We therefore endeavor to build common values and goals throughout our organization, and strive to ensure
a progressive career path for promising employees and retention of quality intellectual capital in the Company. We
provide a performance-based progressive career path for our employees. For instance, we introduced an employee stock
option plan (“ESOP”) in 2005 for eligible employees at branch manager level and above. We believe our attrition rates
are among the lowest in the industry at managerial levels.

Intellectual Property

Pursuant to a License and User Agreement dated November 28, 2003 between our Company and SCL (formerly Shriram
Financial Services Holdings Private Limited), we are licensed to use the name "Shriram" and the associated mark for
which we pay certain royalties in the amount of 0.25% of the Company's gross income to Shriram Capital Limited, as
well as an annualized fee equivalent to 0.1% of the total gross funds mobilized by SCL for access to the database of
agents and Chit subscribers. The License and User Agreement which was valid until November 27, 2008, has been
extended until March 31, 2011.

We have also applied for registration of the trademark "AUTOMALL", “NEW LOOK” and “ONE STOP”with the
Registrar of Trademarks in India.

Technology

We use information technology as a strategic tool in our business operations to improve our overall productivity. We
believe that our information systems enable us to manage our nationwide operations network well, as well as to
effectively monitor and control risks.

All our branches are online, connected through VPN (Virtual Private Network) with our Central Server located at
Chennai Data Center and our Disaster Recovery Site located at Mumbai.

Property

Our registered office is at 123, Angappa Naicken Street, Chennai 600 001, Tamil Nadu, India. Our corporate office is at
Wockhardt Towers, Level 3, West Wing, C-2, G Block, Bandra - Kurla Complex, Bandra (East) Mumbai 400 051, India.
As of December 31, 2009, we had 482 branches across India. We typically enter into lease agreements for these strategic
business unit and branch locations.

Collaborations

Except as disclosed herein, our Company has not entered into any collaboration, any performance guarantee or assistance
in marketing by any collaborators.

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 HISTORY, MAIN OBJECTS AND KEY AGREEMENTS

Brief background of our Company

Our Company was incorporated as a public limited company under the provisions of the Act, by a certificate of
incorporation dated June 30, 1979, issued by the ROC, Tamil Nadu, Chennai. Our Company commenced its operations,
pursuant to a certificate of commencement of business dated October 9, 1979. Subsequently, our Company has obtained
a certificate of registration dated September 4, 2000 bearing registration no. A-07-00459 issued by the RBI to carry on the
activities of a NBFC under section 45 IA of the RBI Act, 1934, which has been renewed on April 17, 2007, (bearing
registration no. 07-00459). The registered office of our Company is 123, Angappa Naicken Street, Chennai-600 001.

Amalgamation of Shriram Investments Limited and Shriram Overseas Finance Limited with our Company

The Hon’ble High Court of Madras vide its order dated November 25, 2005, approved the scheme of arrangement and
amalgamation of the erstwhile SIL, with our Company, (“SIL Scheme of Merger”). The appointed date for the SIL
Scheme of Merger was April 1, 2005 and the record date for the purposes of re-organisation and issue of shares was
December 21, 2005.

The Hon’ble High Court of Madras vide its order dated December 1, 2006, approved the scheme of arrangement and
amalgamation of the erstwhile SOFL with our Company, (“SOFL Scheme of Merger”). The appointed date for the
SOFL Scheme of Merger was April 1, 2005 and the record date for the purposes of re-organisation and issue of shares
was February 9, 2007.

Main objects of our Company

The main objects of our Company as contained in our Memorandum of Association are:

• To carry on and undertake business as Financiers and Capitalists, to finance operations of all kinds such as
managing, purchasing, selling, hiring, letting on hire and dealing in all kinds of vehicles, motor cars, motor
buses, motor lorries, scooters and all other vehicles;

• To undertake and carry on all operations and transactions in regard to business of any kind in the same way as
an individual capitalist may lawfully undertake and carry out and in particular the financing Hire Purchase
Contracts relating to vehicles of all kinds;

• To carry on and undertake business as Financier and Capitalists to finance operations of all kinds such as
managing, purchasing, selling, hiring, letting on hire and dealing in all kinds of property, movable or
immovable goods, chattels, lands, bullion;

• To undertake and carry on all operations and transactions in regard to business of any kind in the same manner
as an individual capitalist may lawfully undertake and carryout and in particular financing hire purchase
contracts relating to property or assets of any description either immovable or movable such as houses, lands,
stocks, shares, Government Bonds;

• To carry on and become engaged in financial, monetary and other business transactions that are usually and
commonly carried on by Commercial Financing Houses, Shroffs, Credit Corporations, Merchants, Factory,
Trade and General Financiers and Capitalists;

• To lend, with or without security, deposit or advance money, securities and property to, or with, such persons
and on such terms as may seem expedient;

• To purchase or otherwise acquire all forms of immovable and movable property including Machinery,
Equipment, Motor Vehicles, Building, Cinema Houses, Animals and all consumer and Industrial items and to
lease or otherwise deal with them in any manner whatsoever including resale thereof, regardless of whether the
property purchased, and leased be new and/or used;

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• To provide a leasing advisory counselling service to other entities and/or form the leasing arm for other entities;

• The Company shall either singly or in association with other Bodies Corporate act as Asset Management
Company/Manager/Fund Manager in respect of any Scheme of Mutual Fund whether Open-End Scheme or
Closed-end Scheme, floated/ to be floated by any Trust/Mutual Fund (whether offshore or on shore)/ Company
by providing management of Mutual Fund for both offshore and onshore Mutual Funds, Financial Services
Consultancy, exchange of research and analysis on commercial basis;

• Constitute any trust and to subscribe and act as, and to undertake and carry on the office or offices and duties of
trustees, custodian trustees, executors, administrators, liquidators, receivers, treasurers, attorneys, nominees and
agents; and to manage the funds of all kinds of trusts and to render periodic advice on investments, finance,
taxation and to invest these funds from time to time in various forms of investments including shares, term
loans and debentures etc.;

• Carry on and undertake the business of portfolio investment and Management, for both individuals as well as
large Corporate Bodies and/or such other bodies as approved by the Government, in Equity Shares, Preference
Shares, Stock, Debentures (both convertible and non-convertible), Company deposits, bonds, units, loans
obligations and securities issued or guaranteed by Indian or Foreign Governments, States, Dominions,
Sovereigns, Municipalities or Public Authorities and/or any other Financial Instruments, and to provide a
package of Investment/Merchant Banking Services by acting as Managers to Public Issue of securities, to act as
underwriters, issue house and to carry on the business of Registrar to Public issue/various investment schemes
and to act as Brokers to Public Issue;

• Without prejudice to the generality of the foregoing to acquire any share, stocks, debentures, debenture-stock,
bonds, units of any Mutual Fund Scheme or any other statutory body including Unit Trust of India, obligations
or securities by original subscription, and/or through markets both primary, secondary or otherwise participating
in syndicates, tender, purchase, (through any stock exchange, OTC exchange or privately), exchange or
otherwise and to subscribe for the same whether or not fully paid up, either conditionally or otherwise, to
guarantee the subscription thereof and to exercise and to enforce all rights and powers conferred by or
incidental to the ownership thereof and to advance deposit or lend money against securities and properties to or
with any company, body corporate, firms, person or association or without security and on such terms as may
be determined from time to time;

• To engage in Merchant Banking activities, Venture Capital, acquisitions, amalgamations and all related
merchant banking activities including loan syndication;

• To carry on the business as manufacturers, Exporters, Importers, Contractors, Sub-contractors, Sellers, Buyers,
Lessors or Lessees and Agents for Wind Electric Generators and turbines, Hydro turbines, Thermal Turbines,
Solar modules and components and parts including Rotor blades, Braking systems, Tower, Nacelle, Control
unit, Generators, etc. and to set up Wind Farms for the company and/or for others either singly or jointly and
also to generate, acquire by purchase in bulk, accumulate, sell, distribute and supply electricity and other power
(subject to and in accordance with the laws in force from time to time);

• To carry on business of an investment company or an Investment Trust Company, to undertake and transact
trust and agency investment, financial business, financiers and for that purpose to lend or invest money and
negotiate loans in any form or manner, to draw, accept, endorse, discount, buy, sell and deal in bills of
exchange, hundies, promissory notes and other negotiable instruments and securities and also to issue on
commission, to subscribe for, underwrite, take, acquire and hold, sell and exchange and deal in shares, stocks,
bonds or debentures or securities of any Government or Public Authority or Company, gold and silver and
bullion and to form, promote and subsidise and assist companies, syndicates and partnership to promote and
finance industrial enterprises and also to give any guarantees for payment of money or performance of any
obligation or undertaking, to give advances, loans and subscribe to the capital of industrial undertakings and to
undertake any business transaction or operation commonly carried on or undertaken by capitalists, promoters,
financiers and underwriters;

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• To act as investors, guarantors, underwriters and financiers with the object of financing Industrial Enterprises,
to lend or deal with the money either with or without interest or security including in current or deposit account
with any bank or banks, other person or persons upon such terms, conditions and manner as may from time to
time be determined and to receive money on deposit or loan upon such terms and conditions as the Company
may approve provided that the Company shall not do any banking business as defined under the Banking
Regulations Act, 1949;

• To carry on in India or elsewhere the business of consultancy services in various fields, such as, general,
administrative, commercial, financial, legal, economic, labour and industrial relations, public relations,
statistical, accountancy, taxation and other allied services, promoting, enhancing propagating the activity of
investment in securities, tendering necessary services related thereto, advising the potential investors on
investment activities, acting as brokers, sub-brokers, Investment Consultant and to act as marketing agents,
general agents, sub agents for individuals/ bodies corporate/Institutions for marketing of shares, securities,
stocks, bonds, fully convertible debentures, partly convertible debentures, Non-convertible debentures,
debenture stocks, warrants, certificates, premium notes, mortgages, obligations, inter corporate deposits, call
money deposits, public deposits, commercial papers, general insurance products, life insurance products and
other similar instruments whether issued by government, semi government, local authorities, public sector
undertakings, companies corporations, co-operative societies, and other similar organizations at national and
international levels;

• To carry on the business of buying, selling of trucks and other CVs and reconditioning, repairing, remodelling,
redesigning of the vehicles and also acting as dealer for the said vehicles, for all the second hand commercial
and other vehicles and to carry on the business of buying, selling, importing, exporting, distributing,
assembling, repairing and dealing in all types of vehicles including re-conditioned and re-manufactured
automobiles, two and three wheelers, tractors, trucks and other vehicles and automobile spares, replacement
parts, accessories, tools, implements, tyres and tubes, auto lamps, bulbs, tail light and head light bulbs,
assemblies and all other spare parts and accessories as may be required in the automobile industry.

Key terms of our Material Agreements

(1) Share subscription agreement dated February 2, 2006 & Amendment Agreement dated September 12,
2008 with Newbridge India Investments II Limited (“New Bridge”), our Promoter, Sri R. Thyagarajan,
Sri T Jayaraman, Sri AVS Raja and Shriram Financial Services Holdings Private Limited, (collectively
“Founders”), Shriram Recon Trucks Limited, Shriram Holdings (Madras) Private Limited and SOFL

Pursuant to the aforesaid agreement New Bridge has subscribed to 49.00% of the paid-up share capital of our
Promoter, and our Promoter has subscribed to 244,78,681 (two hundred and forty four lac seventy eight
thousand six hundred and eighty one) Equity Shares and 160,00,000 (one hundred and sixty lac) warrants of our
Company. The salient features of the aforesaid agreement are as follows:

(i) Board of Directors: Under the terms of the aforesaid agreement, our Board shall constitute of 12 (twelve)
Directors of which two shall be nominees of New Bridge, two shall be nominees of Founders, two shall be
nominees of UNO Investments and one nominee each of Citicorp and IREDA and the rest shall be independent
directors. As on the date of this Prospectus, UNO Investments, Citicorp and IREDA do not hold any equity
shares in the paid up equity share capital of our Company, and consequently are not entitled to appoint any
nominee on the board of directors of our Company. The Founders shall appoint the Managing Director. New
Bridge and the Founders shall agree on a panel of not more than 10 (ten) independent directors, to be
reconstituted every year. The directors nominated by New Bridge and the Founders shall have equal rights and
privileges. Both New Bridge and Founders shall be entitled to nominate equal number of nominees on each
committee of our Board. In the event that the size of the Board is increased beyond 12 directors, New Bridge
and the Founders will each be entitled to appoint three directors on the Board. In the event that any shareholder
having a right to nominate a director ceases to have such right, then the resulting vacancy shall be filled by the
appointment of independent directors. In addition, New Bridge, on the one hand, and the Founders, on the other
hand, are entitled to nominate an equal number of nominees on any committee of the Board.

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(ii) Quorum: The quorum for any meeting of the committee formed to take decisions on certain reserved matters,
which require the specific consent of the respective nominees of New Bridge and the Founders shall be 2 (two)
Directors, of which, one shall be the nominee of the New Bridge or the Founders, or both, as the case may be.

(iii) Fundamental Issues: Certain reserved matters require the affirmative vote and/or prior consent of the directors
nominated by New Bridge and the Founders on our Board or any committee thereof. These matters include,
among others, any further issuance of any Equity Shares by the Company; acquisition of the assets of any other
business; creation of a joint venture or partnership, or merger, demerger and consolidation or any other business
combination; disinvestment in any subsidiary; appointment, removal and revision of the compensation of key
personnel; capital expenditure in excess of Rs.30 lacs; any amendment to the memorandum or articles of
association of the Company; any amendment in the annual business plan of the Company; commencement of a
new line of business; any changes to material accounting or tax policies; recommendation of or declaration of
dividend or distribution of any kind; removal of the statutory or internal auditor; any bankruptcy, dissolution,
insolvency, recapitalization, reorganization, assignment to creditors, winding up and/or liquidation; an increase
or reorganization in the issued, subscribed or paid up equity or preference share capital; any connected person
transaction; any amendment, modification or cancellation of the trademark license agreement (license and user
agreement) between Shriram Financial Services Holdings Private Limited, as licensor, and the Company for the
use of the "Shriram" brand and associated logos. In the event that the beneficial ownership of New Bridge in
the Company, indirectly through our Promoter or directly, becomes greater than that of the Founders, then the
number of reserved matters requiring the affirmative vote of the directors nominated by the Founders would be
reduced; moreover, in such event, New Bridge shall also be entitled to appoint and remove the managing
director (whether designated as managing director, CEO, COO or otherwise) and other key employees of the
Company and of our Promoter.

(iv) Exit: As an exit mechanism, New Bridge may, at any time after expiry of two years from September 12, 2008,
require our Promoter to distribute the shares held by our Promoter in the Company amongst the Founders and
New Bridge in proportion to their respective holdings in our Promoter; in the alternative, New Bridge may
require the merger of our Promoter with the Company in order to effect such distribution. Moreover, within
two years from September 12, 2008, New Bridge is entitled to acquire controlling interest in our Promoter from
the Founders, subject to the payment of a call option price plus a control premium. The Company, the Founders
and our Promoter Shriram Holdings (Madras) Private Limited have agreed to jointly and severally indemnify
New Bridge in the event of any breach of the terms of such Share Subscription Agreement.

(v) Drag along rights: Drag along rights are also provided for in the Share Subscription Agreement. New Bridge is
entitled, at any time after March 11, 2011 to require the Founders to sell all or part of the latter's shares or
warrants in the Company or in our Promoter. In the event that New Bridge does not accept the purchase offer
of a proposed purchaser as communicated by the Founders, New Bridge may in turn present the Founders with
the terms of another purchase offer, which shall not provide for a lower purchase price.

Certain rights enjoyed by New Bridge and the Founders under the aforesaid agreement shall extinguish upon
sale and/or transfer, (other than to affiliates), of more than 50% of the fully diluted percentage beneficial
ownership held by New Bridge or the Founders, as the case may be, in our Company.

(2) Share Purchase Agreement dated March 28, 2007, with Ashley Transport Services Limited (“ATSL”),
Ashok Leyland Limited and INDUSIND Bank and Shareholders Agreement dated March 28, 2007 with
Ashok Leyland Limited, Ashley Investments Limited Ashley Holdings Limited (“AL Group”) and Ashley
Transport Services Limited (“ATSL”), (collectively “Joint Venture Agreements”)
.

Pursuant to the Joint Venture Agreements, our Company had acquired 4,00,000 (four lac) equity shares of Rs.
100/- each of ATSL (at Rs 45 per share), representing 40% (forty per cent) of the paid-up share capital of ATSL
from the Sellers. However current holding of our Company in ATSL has reduced to 15% on account of transfer
of shares to an associate company. The salient features of the Joint Venture Agreements are as follows:

(i) Board Composition: The board of directors of ATSL shall have 5 (five) members, of which 2 (two) members
shall be the nominees of our Company and 3 (three) members shall be the nominees of the AL Group. AL
Group shall be entitled to appoint the chairman of the board of directors of ATSL.
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(ii) Prior Consent of Sellers: The day to day affairs of ATSL shall be exercised by the chief executive officer to be
appointed by AL Group with the consent of the board of directors of ATSL. No decision on certain fundamental
issues relating to ATSL, as contemplated in the Joint Venture Agreements, shall be taken except with the
affirmative vote of at least one nominee of our Company and/or its affiliates and one nominee of the AL group,
respectively, on the board of directors of ATSL. Such fundamental issues inter-alia relate to change of name,
amendment to memorandum and articles of association, changes in the capital structure, declaration of
dividend, appointment of functional heads, any proposal for merger/ consolidation / reconstruction/ liquidation,
change of auditors, change of accounting principles and policies, and approval of employment policies.

(iii) Transfer of Rights: For a period of 3 (three) years neither party can transfer or assign its shares held in ATSL to
any person other than an affiliate of such party. Thereafter, the party intending to sell shall give the other parties
the right of first refusal with respect to the shares of ATSL proposed to be transferred.

(iv) Non-Compete: Neither our Company nor the AL Group shall compete with the business of ATSL in India,
during the term of the Joint Venture Agreement, and 3 (three) years from the time they cease to be a party
thereto. However, the aforesaid restriction shall not apply to investments upto 24% (twenty four percent) of the
capital of any company.

(3) License and User Agreement, dated November 28, 2003 with Shriram Chits and Investments Private
Limited, (now SCL), (“Brand License Agreement”):

Our Company has entered into the Brand License Agreement with SCL, for the use of the brand name
“Shriram” and the associated logo of a “man carrying a suit carrying a bag in one hand and the index finger of
the other raised hand pointing towards a direction with the name “Shriram” inscribed in it”, (collectively
referred to as the “Shriram Brand”). The salient features of the Brand License Agreement are as follows:

(i) Permitted Uses and Restrictions on use of the Shriram Brand: Our Company is allowed to use the Shriram
Brand for carrying on business in the fields of finance and investment, including (a) hire purchase and leasing
of transport vehicles, (b) hire purchase and leasing of consumer durables, (c) inter-corporate and other means of
lending, and (d) investment in financial assets in the form of shares, debentures and bonds etc, (“Permitted
Businesses”). However, we are not entitled to use the Shriram Brand for any business involving (a) speculation,
(b) lending for film production or distribution, or (c) lending for stock market operations. Further, in the event
our Company decides to carry on any business other than the Permitted Businesses, we must seek prior
permission of SCL for the use of the Shriram Brand in connection therewith.

(ii) Assignment: The Company is not entitled to (a) assign the Brand License Agreement to any third person, or (b)
to authorize or transfer the right to use the Shriram Brand under the Brand License Agreement in favour of any
third party.

(iii) Consideration: In consideration for the rights granted by SCL in connection with the Shriram Brand pursuant to
the Brand License Agreement, our Company must pay royalty equivalent to 0.25% of the total business of the
Company, payable at the end of each quarter.

(iv) Term and termination: The Brand License Agreement is valid for a period of five years from the date thereof,
and may be renewed by the parties on such terms and conditions as may be mutually agreed. During the
subsistence of the Brand License Agreement, if any party commits a breach of any obligation or covenant
contained therein, the other party shall serve a notice of two moths to rectify such breach, and on expiry of the
aforesaid period of two moths, if such breach is not rectified or is incapable of being rectified, the party serving
the notice shall be entitled to terminate the Brand License Agreement. Further, the Brand License Agreement
shall stand terminated in the event (a) our Company is declared insolvent or is in the process of being wound
up, (b) a receiver is appointed for the management of any of the assets of our Company, and (c) there is any
change in control vis-à-vis the management of our Company. The Brand License Agreement is valid till March
31, 2011.

(4) Agreement dated September 8, 2006 and Supplemental Agreement dated July 20, 2007 with UTI Bank
Limited, (now known as Axis Bank Limited), (“Axis Bank”), in connection with Co-branded Credit
Cards, (collectively referred to as “Credit Card Agreement”):

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 Our Company has executed the Credit Card Agreement with Axis Bank, for jointly establishing a co-branded
credit card programme for the issue of co branded credit cards, (“Card”), issued by Axis Bank which would
bear trademarks, service marks and emblems, of (a) Axis Bank, (b) our Company, (c) VISA International, and
(d) any other names, marks and/or logos which the parties may mutually agree upon. The salient features of the
Credit Card Agreement are as follows:

(i) Co-branded Card Programme: The Card shall be in an agreed form which will conform to Axis Bank’s card
design standards and the guidelines issued by VISA International from time to time. The design of the Card
shall be subject to the prior approval of Axis Bank and shall conform to guidelines formulated by VISA
international.

(ii) Issue of the Card: The Cards shall be produced by Axis Bank at its own cost and expenses and shall be issued
and owned by Axis Bank during the pendency of the Credit Card Agreement.

(iii) Marketing and distribution: Our Company shall be primarily responsible for implementing the marketing plan
and for sourcing of the new Card. The marketing plan shall be reviewed once in a year by both parties jointly to
consider such improvements as may be necessary. Our Company shall be liable to bear all costs in connection
with marketing of the Card.

(5) Agreement dated March 25, 2009, as amended by an Amendment Agreement dated September 22, 2009,
with NuPower Renewables Limited, (“NU Power”) for the sale and transfer of our wind power
generation turbines, (“NuPower Slump Sale Agreement”)

Our Company had executed the NuPower Slump Sale Agreement for the sale of our wind power generation
turbines together with all assets and liabilities thereof as a going concern, (“Wind Power Turbines”). The
salient features of the NuPower Slump Sale Agreement are as follows:

(i) Conditions Precedent: Consummation of the NuPower Slump Sale Agreement is subject to certain conditions
precedent, (“CPs”) inter-alia including:

• Our Company shall have received necessary consents to (a) own and operate the Wind Power
Turbines, and (b) transfer the Wind Power Turbines to NU Power on terms and conditions no more
onerous than those granted to our Company and no such consent shall have been revoked;

• Our Company shall have received the permission of the assessing officer as required under Section 281
of the IT Act permitting the sale of Wind Power Turbines to NU Power and shall have delivered the
permission obtained to NU Power;

• Our Company shall have repaid the entire loan and/or financial assistance availed by us from banks
and/or financial institutions with respect to the Wind Power Turbines and shall have provided certified
true copies of the letters of satisfaction procured in this regard with the release letters releasing all the
encumbrances on the Wind Power Turbines to NU Power.

(ii) Part Consideration and refund thereof: Upon execution of the NuPower Slump Sale Agreement, NU Power
has paid a certain amount as part consideration to our Company. In the event the transaction as contemplated by
the NuPower Slump Sale Agreement is not consummated by October 31, 2009 or such other date as may be
extended by NU Power, either due to non fulfilment of the CPs or due to wilful negligence or default by our
Company, our Company shall forthwith refund and pay the entire amount of the aforesaid part consideration to
NU Power along with the specified interest thereon and a certain amount of liquidated damages as detailed in
the NuPower Slump Sale Agreement. Until such time as our Company refunds NU Power, the entire aforesaid
part consideration along with the interest and liquidated damages, NU Power shall have a charge on the assets
relating to the Wind Power Turbines.

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(iii) Direct payments to the Indian Renewable Energy Development Agency Limited, (“IREDA”) and the Bank of
Maharashtra, (“BOM”): As part consideration to our Company, NU Power is required to make direct
payments to IREDA and BOM respectively. However, the payments to IREDA and BOM is subject to certain
CPs, one of which requires our Company to provide NU Power with letters, from all the relevant authorities
with whom power purchase agreements have been entered into in relation to the Wind Power Turbines,
approving in principal the assignment of such power purchase agreements in favour of NU Power on the same
terms and conditions.

(iv) Part Consideration held in escrow: Our Company had entered into an escrow agreement dated
September 22, 2009 with NU Power and the State Bank of Patiala (“SBP”) whereunder monies were deposited
into an escrow account maintained with State Bank of India to be released to our Company, subject to the
fulfilment of certain CPs.

(v) Deposit of income generated from the Wind Power Business in escrow: Our Company had entered into another
escrow agreement dated September 22, 2009 with NU Power and SBP for the deposit of all amounts accrued
and/or received by our Company from operating the Wind Power Turbines on and from an agreed date up to
the date of conclusion of the sale, after deducting the expenses incurred by our Company towards the renewal of
operation and maintenance contracts, insurance contracts for the Wind Power Turbines and such other expenses
as may be approved by NU Power up to the date of the transfer of the power purchase agreements to NU Power
(“Escrow Amount”).

(vi) Register of sale of immoveable property in favour of NU Power: : Our Company had executed and registered
sale of land admeasuring an aggregate of 79 acres 65 cents in Tamil Nadu in favour of NU Power.

(6) Agreement dated September 03, 2009, with Bilahari Enterprises Private Limited, (“Bilahari”) for the sale
and transfer of three wind power generation turbines, (“Bilahari Slump Sale Agreement”)

Our Company had executed the Bilahari Slump Sale Agreement for sale of three wind power generation
turbines together with all assets and liabilities thereof as a going concern, (“Wind Power Turbines”). The
salient features of the Bilahari Slump Sale Agreement are as follows:

(i) Conditions Precedent: Consummation of the Bilahari Slump Sale Agreement was subject to certain CPs inter-
alia including:

• Our Company shall have received necessary consents to (a) own and operate the Wind Power
Turbines, and (b) transfer the Wind Power Turbines to Bilahari on terms and conditions no more
onerous than those granted to our Company and no such consent shall have been revoked;

• Our Company shall have received the permission of the assessing officer as required under Section 281
of the IT Act permitting the sale of Wind Power Turbines to Bilahari and shall have delivered the
permission obtained to Bilahari;

• Our Company shall have received from various purchasers of power and the counterparties to the
insurance contracts and operation and maintenance contracts entered into by it in relation to its wind
power generation business, letters confirming that they have no dues pending against our Company.

(ii) Maintenance of the Wind Power Turbines prior to conclusion of the sale: Our Company had maintained and
operated the three Wind Power Turbines till the conclusion of the sale and received the income generated on
and from the date of the Bilahari Slump Sale Agreement till the date of conclusion of the sale. The income
received was kept in trust for the exclusive benefit of Bilahari. Our Company passed on the income received by
it to Bilahari after deducting necessary expenses incurred by our Company towards the maintenance of the
Wind Power Turbines.

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(7) Agreement dated September 03, 2009, with Hymavathi Enterprises Private Limited, (“Hymavathi”) for
the sale and transfer of four wind power generation turbines, (“Hymavathi Slump Sale Agreement”)

Our Company had executed the Hymavathi Slump Sale Agreement for sale of four Wind Power Turbines. The
salient features of the Hymavathi Slump Sale Agreement are as follows:

(i) Conditions Precedent: Consummation of the Hymavathi Slump Sale Agreement was subject to certain CPs
inter-alia including:

• Our Company shall have received necessary consents to (a) own and operate the Wind Power
Turbines, and (b) transfer the Wind Power Turbines to Hymavathi on terms and conditions no more
onerous than those granted to our Company and no such consent shall have been revoked;

• Our Company shall have received the permission of the assessing officer as required under Section 281
of the IT Act permitting the sale of Wind Power Turbines to Hymavathi and shall have delivered the
permission obtained to Hymavathi;

• Our Company shall have received from various purchasers of power and the counterparties to the
insurance contracts and operation and maintenance contracts entered into by it in relation to its wind
power generation business, letters confirming that they have no dues pending against our Company.

(ii) Maintenance of the Wind Power Turbines prior to conclusion of the sale: Our Company had maintained and
operated the four Wind Power Turbines till the conclusion of the sale and received the income generated on and
from the date of the Hymavathi Slump Sale Agreement till the date of conclusion of the sale. The income
received was kept in trust for the exclusive benefit of Hymavathi. Our Company passed on the income received
to Hymavathi after deducting necessary expenses incurred by our Company towards the maintenance of the four
Wind Power Turbines.

(8) Assignment Agreement dated December 22, 2009 between GE Capital Services India and GE Capital
Financial Services (collectively, the “GE Entities”) and our Company; (“Assignment Agreement”)

Pursuant to the terms of an Assignment Agreement our Company has acquired with effect from December 24,
2009 from the GE Entities, on a non-recourse basis, a certain portfolio of receivables in connection with certain
loan facilities relating to commercial vehicle loans and construction equipment loans (the “GE Receivables”),
together with all right, title and interest therein under the relevant underlying loan and security documents
relating to the GE Receivables as of November 28, 2009

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 OUR MANAGEMENT

Board of Directors

The general superintendence, direction and management of our affairs and business are vested in our Board of Directors.
We have not appointed any ‘manager’ within the meaning thereof under the provisions of the Act. Currently, we have 10
(ten) Directors on our Board.

Details relating to Directors

Name, Designation, Nationality Date of Address Other Directorships

Age and DIN Appointment
Mr. Arun Duggal Indian/U.S. September 9, A-4, 3rd Floor, (i) Zuari Industries Limited
Non Executive citizen 2005 West End, (ii) Patni Computers Systems Limited
Chairman (Dual- New Delhi – 110021. (iii) Manipal Acunova Limited
Age: 63 citizenship (iv) Info Edge (India) Limited
holder) (v) Jubilant Energy N.V, Canada
DIN: 00024262 (vi) Shriram Properties Limited
(vii) Dish TV India Limited
(viii) Shriram City Union Finance
Limited
(ix) Mundra Port and Special Economic
Zone Limited
(x) Shriram EPC Limited
(xi) Motrice Limited, Singapore
(xii) FIL Fund Management Private
Limited
(xiii) Carzonrent (India) Private Limited
(xiv)The Bellwether Microfinance Fund
Private Limited
(xv) International Asset Reconstruction
Company Private Limited
(xvi) Blackstone Investment Company
Private Limited
(xvii) Tanglewood Financial Advisors
Private Limited
(xviii)Bank of Bhutan
(xix) Shriram Capital Limited
(xx) Jubiliant Energy N.V., Netherlands

Mr. R. Sridhar Indian September 14, Bungalow No. 33, (i) Shriram Chits Maharashtra Limited
Managing Director 2000 Atur Park, (ii) Ashley Transport Services Limited
Age: 51 VN Purav Marg, (iii) Shriram Holdings (Madras) Private
Chembur, Limited
DIN: 00136697 Mumbai – 400071.

Mr. S. Indian July 28, 2000 34, Oliver Road, (i) Galada Finance Limited
Venkatakrishnan Mylapore, (ii) Shriram City Union Finance Limited
Non Executive Chennai – 600004, (iii) Shriram Investments Holdings
Director Tamil Nadu. Limited
Age: 80 (iv) Shriram Housing Finance &
Development Company Limited
DIN: 00136608 (v) Novochem Laboratories Limited
(vi) Madras Shoe Fabric Company
Limited
(vii) Shriram Credit Company Limited

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Name, Designation, Nationality Date of Address Other Directorships
Age and DIN Appointment
(viii) Shriram Trade Finance Limited
(ix) Shriram Industrial Holdings Private
Limited
(x) Shriram Exports Private Limited
(xi) Ranjani Enterprises Private Limited
(xii) Charukesi Investments Private
Limited
(xiii) Road Safety Club Private Limited
(xiv) Rambal Properties Private Limited.
(xv) Shriman Overseas Investments
Private Limited (Formerly known as
Dhanashri Investment Private Limited)
Mr. S. M. Bafna Indian September 9, 22, Gobind Mahal, (i) Seva Finance Limited
Non-Executive and 2005 86– B, Marine Drive, (ii) Isuta Electronics (India) Limited
Independent Director Mumbai – 400020. (iii) Bafna Motors (Mumbai) Private
Age: 48 Limited
(iv) Bafna Motors (Ratnagiri) Private
DIN: 00162546 Limited
(v) Bafna Motors Private Limited
(vi) Kishor Transport Sevices Private
Limited
(vii)Rushabh Motors Private Limited
(viii)Bafna Aviation Private Limited
(ix)BNB Containers Private Limited
(x)Urjayant Estate Private Limited
(xi)Bafna Health Care Private Limited
(xii) Toyota Logistics Kishor India
Private Limited
Mr. M. S. Verma Indian October 26, A – 55, Belvedere (i) PTC India Limited
Non-Executive and 2006 Park, DLF City, (ii) Visa Steel Limited
Independent Director Phase III, (iii) Jammu & Kashmir Bank Limited
Age: 71 Gurgaon – 122002, (iv) Visa Power Limited
Haryana. (v) T.K. International Private Limited
DIN: 00115431 (vi) Asian Heart Institute and Research
Centre
(vii) International Asset Reconstruction
Company Private Limited.
Mr. Adit Jain Indian October 26, Kachnar House, (i)International Market Assessment India
Non-Executive and 2006 F – 63, Radhe Mohan Private Limited
Drive, (ii)IMA Corporate Advisory Services
Independent Director
Gadaipur Bund Road, Private Limited;
Age: 49
Chattarpur, Mehrauli, (iii)EIU India Private Limited
New Delhi – 110030. (iv)PR Pundit Public Relations Private
DIN: 00835144
Limited
(v) Mahanagar Telephone Nigam

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Name, Designation, Nationality Date of Address Other Directorships
Age and DIN Appointment
Limited
(vi) Indosolar Limited
Mr. M. M. Chitale Indian October 26, 4/46, Vishnu Prasad (i) Asrec (India) Limited
Non-Executive and 2006 Society, (ii) Larsen & Toubro Limited
Vile Parle (East), (iii) Ram Ratna Wires Limited
Independent Director
Mumbai – 400057. (iv) ITZ Cash Card Limited
Age: 60
(v) ONGC Mangalore Petrochemicals
Limited
DIN: 00101004
(vi) ONGC Petro Additions Limited
(vii) Essel Propack Limited
(viii) Foseco India Limited
(ix) Principal PNB Asset Management
Company Private Limited
Mr. Puneet Bhatia Indian October 26, LGG, 123 Laburnum, (i) TPG Capital India Private Limited
Non-Executive 2006 Shushant Lok – I, (ii) Shriram Holdings (Madras) Private
Director and Gurgaon - 122002 Limited.
Nominee of
Newbridge India
Investments II
Limited
Age: 43

DIN: 00143973
Mr S. Indian September 22, 33 Paschimi Marg (i) SUN Group Enterprises Private
Lakshminarayanan 2009 First Floor, Vasant Limited
Non-Executive and Vihar, New Delhi - (ii) Biopure Health Care Private Limited
Independent Director 110057 (iii) ELCOM Systems Private Limited
Age: 63

DIN: 02808698
Mr. Ranvir Dewan Foreign October 26, 41,Ewe Boon Road, (i) PT Bank Tabunean Pensiunan
Non-Executive 2006 # 11-41, Crystal Nasional (Indonesia)
Director Tower, Singapore-
Age: 56 259335.

DIN: 01254350

Profile of Directors

Mr. Arun Duggal - Chairman

Mr. Arun Duggal is the non-executive Chairman of our Board. Mr. Duggal holds a bachelor’s degree in mechanical
engineering from the Indian Institute of Technology, Delhi and a master’s degree in business administration from the
Indian Institute of Management, Ahmedabad. Mr. Duggal is an experienced international banker and has an experience
of approximately 33 years in the banking and finance industry. He has advised companies on financial strategy, mergers
and acquisitions and on various means of capital raising. He is also a member of the Investment Committee of Axis
Private Equity. He was a member on the Board of Governors of the National Institute of Bank Management. He had a
distinguished career with Bank of America for 26 years and was the Chief Executive of Bank of America in India from
1998 to 2001. He spent ten years with New York corporate office of Bank of America handling multinational
relationships. From 2001 to 2003, he was the Chief Financial Officer of HCL Technologies, India. Currently, he is a
visiting faculty at the Indian Institute of Management, Ahmedabad and teaches banking & finance.

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Mr. R. Sridhar – Managing Director

Mr. R. Sridhar is the Managing Director of our Company. Mr. Sridhar holds a bachelor’s degree in Science and is a
qualified chartered accountant and a fellow member of the Institute of Chartered Accountants of India. Mr. Sridhar has
been associated with the Shriram group since 1985. Mr. Sridhar was appointed as the Managing Director of our
Company for the first time in the year 2000 and was reappointed in the year 2005. Mr. Sridhar has been re-appointed as
Managing Director of our Company for a period of five years, with effect from September 15, 2010 to September 14,
2015 by a resolution in the meeting of Board of Directors held on April 29, 2010, subject to the approval of shareholders
of our Company. Mr. Sridhar has over twenty years of experience in the financial services sector, especially in
commercial vehicle financing. He is also the General Secretary of the Western India Hire Purchase Association and Vice
President of Federation of Indian Hire Purchase Association. He is also a member of the managing committee of the
Finance Industry Development Council.
.
Mr. Puneet Bhatia

Mr. Puneet Bhatia is a non-executive Director on our Board. Mr. Bhatia holds a degree in commerce and masters in
business administration from the Indian Institute of Management, Kolkata. Mr. Bhatia has an experience of
approximately 19 years in the finance and investment sector. Mr. Bhatia represents Newbridge India Investments II
Limited (TPG Group) on our Board. He is currently a partner in TPG Capital, India as well as the Managing Director and
the country head - India for TPG’s Asian business. Prior to joining the TPG group, he was the Chief Executive of GE
Capital India. From 1990 to 1995, he was associated with ICICI Bank in the Project and Corporate Finance group and
thereafter worked as a senior analyst with Crosby Securities from 1995 to 1996.

Mr. S. M. Bafna

Mr. S. M. Bafna is a non-executive Director on our Board. Mr. Bafna is a science graduate from Bombay and began his
career in the year 1984. Mr. Bafna has over 25 years of experience in the automobile industry. He thereafter started
independent dealership of Tata Motors at Ratnagiri, Maharastra in the year 1995 and Mumbai dealership in the year
2001. His company has been one of the leading dealers for Tata Motors Limited. He also holds dealerships of vehicles
manufactured by Honda, Hyundai and Maruti Udyog Limited.
.
Mr. M. S. Verma

Mr. M. S. Verma is a non-executive Director on our Board. A career banker, with over fifty years of experience in
banking and finance, Mr. Verma retired as the Chairman of India’s largest commercial bank, State Bank of India in 1998
and has since then served as advisor to the RBI, non-executive Chairman, IDBI Bank and Chairman of the Country’s
Telecommunication Regulatory Body, the Telecom Regulatory Authority of India (TRAI). Currently, he is on the Board
of Directors of several public and private limited companies and is a member of governing board/council of educational
and research institutions of national and international importance like the National Council of Applied Economic
Research (NCAER), Institute of Economic Growth (IEG) and Jawaharlal Nehru University (JNU).

Mr. M. M. Chitale

Mr. M. M. Chitale is a non-executive Director on our Board. Mr. Chitale holds a bachelor’s degree in Commerce and is a
qualified chartered accountant and a fellow member of the Institute of Chartered Accountants of India. Mr. Chitale has
over 35 years of experience as a practicing chartered accountant. He was the president of the Institute of Chartered
Accountants of India during 1997-98 and a member of “International Auditing Practices Committee” of the International
Federation of Accountants from January 1998 to June 2000. He was nominated by SEBI as a public representative
director on the BSE from October 1998 to July 2000. Currently, Mr. Chitale is a partner in Mukund M. Chitale & Co.

Mr. S. Venkatakrishnan

Mr. S. Venkatakrishnan is a non-executive Director on our Board. Mr. Venkatakrishnan holds a bachelor’s degree in
Mathematics from Madras University and a post graduate degree in Mathematics from Madras University. Mr.
Venkatakrishnan is a member of the Indian Audit and Accounts Service, Government of India, where he has held senior
positions in the Finance, Audit & Accounts department of the Government and other Public Undertakings. He also
functioned as BIFR Director in several companies for a period of five years. He has been an advisor to the Company for
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over ten years.

Mr. Ranvir Dewan

Mr. Ranvir Dewan is a non-executive Director on our Board. Mr. Dewan holds a B.Com (Hons) degree from Shriram
College of Commerce, Delhi University, India. He is a fellow member of the Institute of Chartered Accountants in
England & Wales and a member of the Canadian Institute of Chartered Accountants. Mr. Dewan represents Newbridge
India Investments II Limited on our Board. He has over 30 years of experience in the finance and investment sector. Mr.
Dewan joined TPG-Newbridge Capital in July 2006 and is currently the Head of Financial Institutions Group
Operations. Previously he was Executive Vice President and Chief Financial Officer of Standard Chartered First Bank in
Seoul, Korea. He has also spent over thirteen years at Citibank in various senior positions in its international businesses.
He has also held senior positions with KPMG in Canada and England where he specialized in the audits of financial
institutions.

Mr. Adit Jain

Mr. Adit Jain is the Chairman of IMA India. Previously, Mr. Jain worked with Lazard India, an investment bank as Vice
President and Head of M & A. He has advised several multinational corporations towards the development of their India
strategy and has deposed as an expert witness at commercial litigations in the United States and in Parliamentary
proceedings in India and Australia. He provides briefings to Boards of major international corporations and is a frequent
speaker at emerging market seminars. Mr. Jain has over the years authored over five hundred articles and papers in the
domain of politics, international affairs, foreign policy, the environment and business practices and is a leading
commentator on the economic role of governments. He is the Editor of IMA’s Quarterly India Update, CFO Connect
magazine and the firm’s principal economic commentator. Mr. Jain chairs IMA India’s CEO and CFO forums which
together have over 1,200 corporations on a retainer relationship. He is a non-executive director on the Board of Directors
of Shriram Transport Finance Company Limited, PR Pundit Public Relations and EIU India Private Limited. He is a
member of the Board of Trustees of the Centre for Civil Society and the Adit Jain Foundation. Previously, he worked in
the United Kingdom with Wild Barnsley Engineering and Stag Holdings Plc.

Mr. Jain has a bachelor’s degree in mechanical engineering from the Birla Institute of Technology, India and a master’s
degree in business administration from the Henley Management College, UK. As a keen wildlife photographer, he has
travelled extensively in the Indian Himalayas and spends time in National Parks in India and in East Africa.

Mr. S. Lakshminarayanan

Mr. S. Lakshminarayanan is a non-executive Director on our Board. He holds master’s degree in Science in Chemistry
and post graduate diploma from University of Manchester (U.K.) in Advanced Social & Economic Studies. Mr.
Lakshminarayanan is a member of the Indian Administrative Service (IAS-retired) and as such held several senior
positions in the Ministry of Home Affairs, Ministry of Communications and Information Technology, Ministry of
Information and Broadcasting of the Government of India and in the Department of Tourism, Culture and Public
Relations, Department of Mines, Mineral Resources, Revenue and Relief and Rehabilitation of the Government of
Madhya Pradesh. He has served as the Managing Director of the State Apex Cooperative Bank and Cooperative Oilseed
Growers Federation Limited and has served as Director on the Board of Directors of several Public Sector Undertakings
in the State of Madhya Pradesh. Currently, he is on the Board of Sun Group Enterprises Private Limited and Biopure
Health Care Private Limited.

Remuneration of the Directors

The independent directors are paid sitting fees for attending the various meetings of the Board and of the Committees of
the Board as under:

Meeting Overall limit per director (Rs.per meeting)

Meetings of the Board 20,000/-
Meetings of any committee of the Board 15,000/-

Appointment and Remuneration of the Managing Director

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Mr. Sridhar has been re-appointed as Managing Director of our Company for a period of five years, with effect from
September 15, 2010 to September 14, 2015 by a resolution in the meeting of Board of Directors held on April 29, 2010,
subject to the approval of shareholders of our Company. The current remuneration payable to our managing director, as
authorised by an ordinary resolution passed by the shareholders of our Company at their general meeting held on July 31,
2008, is as follows:

A. Remuneration:

(i) Salary: Subject to the provisions of the Act, our managing director shall be entitled to a salary of Rs. 2,00,000/-
(Rupees two lac only) per month, with an annual increase of 10% (ten per cent);

(ii) Commission: Our managing director is entitled to such percentage of commission (in addition to salary and
perquisites) calculated with reference to the net-profit of the Company, in accordance with section 349 and
section 350 of the Companies Act, 1956 for each Financial Year, as may be fixed by the Board of Directors,
which together with the salary and monetary value of the perquisites shall not exceed the ceiling laid down
under section 309 of the Companies Act, 1956;

B. Perquisites:

(i.) Housing- Rent free accommodation owned/leased/rented by the Company or housing allowance in lieu thereof
as per the rules of the Company.

(ii.) Payment of water, gas, electricity and furnishing charges for residence, to be valued in accordance with Income
Tax Rules, subject to a maximum of 10% of the salary.

(iii.) Medical Reimbursement- Reimbursement of medical, surgical and hospitalisation expenses for the Managing
Director and family subject to a maximum of Rs. 25,000/- per annum.

(iv.) Leave travel concession for the Managing Director and family, subject to a maximum of Rs. 75,000/- per
annum.

(v.) Personal accident/ Group Insurance- The annual premium not to exceed Rs. 4,000/-

(vi.) Club fees- Subscription limited to a maximum of two clubs. No life membership or admission fees shall be paid
by the Company. All official expense in connection with such membership incurred would be reimbursed by the
Company.

(vii.) Expenditure on official entertainment would be on the Company’s account.

(viii.) Contribution to Provident Fund, Superannuation Fund or Annuity Fund- As per the rules of the Company.
These will not be considered or included for the computation of ceiling on perquisites to the extent these either
singly or put together are not taxable under the Income Tax Act, 1961.

(ix.) Gratuity not exceeding half a months’s salary for each completed year of service.

(x.) Encashment of leave at the end of the tenure- As per the rules of the Company.

(xi.) Company’s car with driver for use on Company’s business and maintenance expenses thereon.

(xii.) Free telephone at residence.

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(xiii.) Employees Stock Option- As may be decided by the Remuneration/ Compensation Committee/ Board of
Directors from time to time according to the ESOP Scheme of the Company.

(xiv.) Leave as per the Company’s Rules.

(xv.) Newspaper and periodicals- As per the company’s rules.

(xvi.) Other terms- As per the company’s Rules, and as may be agreed to by the Board from time to time.

Personal long distance calls on telephone and use of car for private purpose shall be charged to the Managing Director.
Those mentioned under ix, x,xi, and xii above will not be considered or included for the purposes of computation of
ceiling on perquisites.

Other Applicable Terms:

1. The Managing Director shall not be paid any sitting fees for attending General Meetings and Meetings of the Board
or Committee thereof.

2. In the event of absence or inadequacy of profits in any financial year, the Managing Director will be paid the above
remuneration (except commission) as minimum remuneration subject to the overall ceilings laid down in Section II
of Part II of Schedule XIII of the Companies Act, 1956.

3. The Board may revise the existing or allow any other facilities/perquisites from time to time, subject to the overall
ceilings laid down in Schedule XIII of the Companies Act, 1956.

For further details refer to the Section titled “Material Contracts and Documents for Inspection” on page 226 this
Prospectus.

Borrowing Powers of the Board

Pursuant to resolution passed by the shareholders of our Company at their AGM held on July 24, 2009 and in
accordance with provisions of Section 293 (1)(d) of the Companies Act, the Board has been authorised to borrow sums
of money as they may deem necessary for the purpose of the business of our Company upon such terms and conditions
and with or without security as the Board of Directors may think fit, provided that money or monies to be borrowed
together with the monies already borrowed by our Company (apart from temporary loans (including working capital
facilities) obtained from our Company’s bankers in the ordinary course of business) shall not exceed Rs.
300,000,000,000 (Rupees Three Hundred Thousand Million only).

Interest of the Directors

All the directors of our Company, including our independent directors, may be deemed to be interested to the extent of
fees, if any, payable to them for attending meetings of the board or a committee thereof as well as to the extent of other
remuneration and reimbursement of expenses payable to them All the non-executive independent directors of our
Company are entitled to sitting fees for every meeting of the board or a committee thereof. The managing director of
our Company is interested to the extent of remuneration paid for services rendered as an officer or employee of our
Company.

All the directors of our Company, including independent directors, may also be deemed to be interested to the extent of
Equity Shares, if any, held by them or by companies, firms and trusts in which they are interested as directors, partners,

- 133 -
members or trustees and also to the extent of any dividend payable to them and other distributions in respect of the said
Equity Shares.

All our directors may be deemed to be interested in the contracts, agreements/arrangements entered into or to be
entered into by our Company with any company in which they hold directorships or any partnership firm in which they
are partners as declared in their respective declarations. Except as otherwise stated in this Prospectus and statutory
registers maintained by our Company in this regard, our Company has not entered into any contract, agreements or
arrangements during the preceding two years from the date of this Prospectus in which the directors are interested
directly or indirectly and no payments have been made to them in respect of these contracts, agreements or
arrangements which are proposed to be made with them.

Our Company’s directors have not taken any loan from our Company.

Changes in the Directors of our Company during the last three years:

The Changes in the Board of Directors of our Company in the three years preceding the date of this Prospectus are as
follows:

Sr. Name of the Director Date of Change Reason

No.
1. Mr. Sanjay Kukreja March 30, 2009 Resigned as Director
2. Mr. Ravindra Bahl November 19, Resigned as Director
2009
3. Dr. T.S. Sethurathnam November 11, Resigned as Director
2009
4. Mr. S. Lakshminarayanan September 22, Appointed as Additional Director
2009

Shareholding of Directors, including details of qualification shares held by Directors

As per the provisions of our MOA and AOA, Directors are not required to hold any qualification shares. Details of the
shares held in our Company by our Directors, as on April 30, 2010 are provided in the table given below:

Sr. Name of Director No. of shares Percentage of the

No. held total paid-up
capital (%)
1 Mr. R. Sridhar 130,176 0.06
2. Mr. S M. Bafna 1,200 0.00
3. Mr. S.Venkatakrishnan 4448 0.00

Corporate Governance

Our Company has been complying with the requirements of the applicable regulations, including the listing agreement
with the Stock Exchanges where our securities are listed and the SEBI Regulations, in respect of corporate governance
including constitution of the Board and Committees thereof. The corporate governance framework is based on an
effective independent Board, separation of the Board’s supervisory role from the executive management team and
constitution of the Board Committees, as required under law.

The Board is constituted in compliance with the Companies Act , the listing agreement with Stock Exchanges where our
securities are listed and in accordance with best practices in corporate governance. The Board functions either as a full
Board or through various committees constituted to oversee specific operational areas. The executive management of our
Company provides the Board detailed reports on its performance periodically.

Details of various committees of the Board

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Our Company has constituted the following committees:

A. Audit Committee

The members of the Audit Committee as on April 30, 2010 are:

1. Mr. M. S. Verma - Chairman

2. Mr. Puneet Bhatia
3. Mr. M. M. Chitale
4. Mr. S. M. Bafna

The terms of reference of the Audit Committee, inter alia, include:

• Overseeing the financial reporting process.

• To ensure proper disclosure in the quarterly, half yearly and Annual Financial Statements.
• To recommend appointment of Auditors and their remuneration.
• Reviewing, with the management, the Financial Statements before submission to the Board.
• Reviewing, with the management, performance of Statutory and Internal Auditors, adequacies of the internal
control systems.
• Reviewing the adequacy of internal audit function including the structure of the internal audit department,
staffing and seniority of the official heading the department, reporting structure, coverage and frequency of
internal audit.
• Discussing with Internal Auditors on any significant findings and follow up there on.
• Reviewing the findings of any internal examinations by the Internal Auditors into matters where there is
suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the
matter to the Board.
• Discussing with Statutory Auditors before the audit commences, about the nature and scope of audit as well as
post-audit discussion to ascertain any area of concern.
• To discuss with management, the senior internal audit executives and the Statutory Auditor/s the Company's
major risk exposures and guidelines and policies to govern the processes by which risk assessment and risk
management is undertaken by the Company, including discussing the Company’s major financial risk
exposures and steps taken by management to monitor and mitigate such exposures and from time to time
conferring with another Committee/s of the Board about risk exposures and policies within the scope of such
other Committee’s oversight.
• To look into the reasons for substantial defaults in the payment to the depositors, debenture holders,
shareholders (in case of non payment of declared dividends) and creditors, if any.
• To review the functioning of the Whistle Blower Mechanism.
• Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.

B. Remuneration/ Compensation Committee

The members of the Remuneration/Compensation Committee as on April 30, 2010 are:

1. Mr. Adit Jain - Chairman

2. Mr. Puneet Bhatia
3. Mr. M. M. Chitale
4. Mr. S. M. Bafna

The terms of reference of the Remuneration/ Compensation Committee, inter alia, include:

The Committee is responsible for assisting the Board of Directors in the Board’s overall responsibilities relating to
determination on their behalf and on behalf of the shareholders with agreed terms of reference, our Company’s policy on
specific remuneration packages and any compensation payment for Managing Director, Whole-time Directors and
Executive Directors. The role of the Committee includes:

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• To provide independent oversight of and to consult with management regarding the Company’s compensation,
bonus, pension, and other benefit plans, policies and practices applicable to the Company’s executive
management.

• To develop guidelines for and annually review and approve (a) the annual basic salary, (b) the annual incentive
and bonus, including the specific goals and amount, and (c) equity compensation for the Managing Director and
the other executive officers of the Company.

• To review and approve (a) employment agreements, severance arrangements and change in control
agreements/provisions, and (b) any other benefits, compensation or arrangements, for the Managing Director
and the other executive officers of the Company.

Further, the Committee is responsible for assisting the Board of Directors in the Board’s overall responsibilities relating
to the ESOP including, administration of our Company’s stock incentive plans, and other similar incentive plans, and
interpret and adopt rules for the operation thereof. The Committee’s responsibility also covers establishment of
guidelines for and approval of the grant of stock options to key employees, officers and directors of our Company,
including determination of the number of shares to be covered by each option, whether the option will be an incentive
stock option or otherwise, and the vesting schedule for such options.

C. Shareholders’ and Investors’ Grievance Committee

The members of the Shareholders’ and Investors’ Grievance Committee as on April 30, 2010 are:

1. Mr. M. M. Chitale - Chairman

2. Mr. R. Sridhar

The Committee is responsible for assisting the Board of Directors in the Board’s overall responsibilities relating to
attending to and redressal of the grievances of the shareholders and the investors of our Company. The Committee in
particular looks in to:

• The listing of securities on stock exchanges.

• The shareholders' and investors' complaints on matters relating to transfer of shares, non-receipt of annual
report, non-receipt of dividends and matters related thereto.

• The matters that can facilitate better investor services and relations.

• Attending to investors' queries and complaints regarding transfer, dividend, annual reports, etc

• Attending to complaints of investors routed by SEBI/Stock Exchanges/RBI.

• The amounts transferable to Investor Education and Protection Fund.

• The profile of investors.

• Taking decisions in connection with issue of global depository receipts, and

• The secretarial audits.

D. Asset liability Management Committee

The members of the Asset liability Management Committee as on April 30, 2010 are:

1. Mr. R. Sridhar - Chairman

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2. Mr. Ranvir Dewan
3. Mr. Parag Sharma

Terms of Reference: The committee is responsible for assisting the Board of Directors in Balance Sheet planning from
risk return perspective including the strategic management of interest and liquidity risk. Its functions include:

• Liquidity risk management

• Management of market risk

• Funding and capital planning

• Profit planning and growth projection

• Forecasting and analysing future business environment and preparation of contingency plans

E. Banking and Finance Committee

The members of the Banking and Finance Committee as on April 30, 2010 are:

1. Mr. R. Sridhar - Chairman

2. Mr. V. N. Kelkar
3. Mr. Parag Sharma

Terms of Reference: The Banking and Finance Committee has been formed to monitor resources mobilisations and to
ensure efficient and timely decisions on the matters relating to banking and finance activities of our Company. The
Committee meets regularly to discharge its functions.

Payment of benefits and profit-share to Employees

Except entitlement to stock options under the ESOP, and payments in accordance with the terms of appointment of our
employees, we have not paid or granted any amounts or benefits to our employees, in the two years preceding the date of
this Prospectus. Our employees are not entitled to any share in the profits of our Company.

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 OUR PROMOTER

Profile of our Promoter

Our Promoter is Shriram Holdings (Madras) Private Limited.

Shriram Holdings (Madras) Private Limited was incorporated as a private limited company under the Act, with the name
Rambal Holdings Private Limited, vide a certificate of incorporation dated April 19, 1993 issued by the ROC, Tamil
Nadu. Subsequently, the name of our Promoter was changed to Shriram Holdings (Madras) Private Limited and a fresh
certificate of incorporation dated February 11, 1994 was issued by the Registrar of Companies, Tamil Nadu. The
registered office of our Promoter is located at Mookambika Complex, No.4, Lady Desika Road, Mylapore, Chennai 600
004. Our Promoter is primarily engaged in the business of holding shares and investments in our Company. Our
Promoter has not been named or set out as a promoter of any other company in any offer document, filing with stock
exchange(s) or with any regulatory and/or statutory authorities. Further, besides holding shares of our Company, our
Promoter does not directly or indirectly hold shares in the share capital of any company. There are no common pursuits
between our Company and our Promoter.

Interest of Promoter in our Company

Except as stated under the section titled “Financial Information” beginning on page 142 of this Prospectus and to the
extent of their shareholding in our Company, the Promoter does not have any other interest in our Company’s business.
Further, our Promoter has no interest in any property acquired by our Company in the last two years from the date of this
Prospectus, or proposed to be acquired by our Company.

Our Promoter does not propose to subscribe to this Issue.

Other than the payment of dividend on the shares held by our Promoter in the share capital of our Company, and issue of
the following Equity Shares and warrants convertible into Equity Shares, interest paid on Inter-corporate Deposit, we
have not paid or granted any amounts or benefits, in the two years preceding the date of this Prospectus.

Details of Shares allotted to our Promoter during the last two FY

Sr. Date of
No. Nature of Transaction allotment No. of Securities Issue Price (Rs.)
Conversion of Warrants issued on December
1. 14, 2007 June 12, 2009 80,00,000 300/-

Shareholding Pattern of our Promoter as on April 30, 2010:

Sr. Name of Shareholder No. of Shares Percentage

No. Shareholding(%)
1. Shriram Capital Limited 1,86,56,419 50.17
2. Newbridge India Investments II Limited 1,82,22,639 49.00
3. Tanglewood Financial Advisors Private 3,10,000 0.83
Limited
Total 3,71,89,058 100.00

Board of directors of our Promoter as on April 30, 2010

1. Mr. D.V. Ravi

- 138 -
2. Mr. G.V. Raman

3. Mr. R. Sridhar

4. Mr. Amol Jain

5. Mr. Daniel A. Carroll

6. Mr. Puneet Bhatia

Changes in the board of directors

There have been no changes in the board of directors of our Promoter in the last three years preceding the date of this
Prospectus.

Financial Performance of our Promoter for the last three financial years
Rs. in Lacs
Particulars FY 2007 FY 2008 FY 2009
Balance Sheet

SOURCES OF FUNDS
Shareholder Funds:
Share Capital 2,969.29 3,138.11 3,138.91

Reserves and Surplus 71,894.22 79,266.66 83,754.73

Total 74,863.51 82,404.77 86,893.64

APPLICATION OF FUNDS
Investments 72,936.01 82,291.21 82,291.21
Deferred Tax Asset (Net) 43.31 44.40 51.79
Current Assets
Cash and Bank Balances 1,850.28 159.49 180.44
Loans & Advances 36.24 43.82 4,387.50
Less: Current Liabilities 2.33 134.15 17.30
Net Current Assets 1,884.19 69.16 4,550.64
Total 74,863.51 82,404.77 86,893.64

Profit and Loss Account

INCOME
Dividend Income 1,808.93 2,561.15 4,355.06
Interest Received 110.46 47.36 150.09
Total 1,919.39 2,608.51 4,505.15

EXPENDITURE
Interest Paid 0.00 131.70 1.70

Administrative Expenses 365.80 1.07 31.02

- 139 -
Particulars FY 2007 FY 2008 FY 2009
Audit Fees 0.07 0.10 0.17
Total 365.87 132.87 32.89
Net Profit Before Tax 1,553.52 2,475.64 4,472.26
Add: Provision for Deferred Tax 53.66 1.08 7.39
Less : Provision for -Taxation - - 14.77
Net Profit After Tax 1,607.18 2,476.72 4,464.88
Balance brought down from Previous Year 75.13 1682.31 4,159.03
Surplus carried over to Balance Sheet 1,682.31 4,159.03 8623.91

- 140 -
 OUR SUBSIDIARIES

As on the date of this Prospectus our Company has the following two subsidiaries:

1. Shriram Equipment Finance Company Limited, (“SEFCL”):

SEFCL was incorporated pursuant to a certificate of incorporation dated December 15, 2009 issued by the
Registrar of Companies, Chennai, Tamil Nadu, and having its registered office situated at 123, Angappa
Naickan Street, Chennai 600001, Tamil Nadu, India.

Shareholding Pattern:

As on the date of this Prospectus our Company holds 100% of the paid-up equity share capital of SEFCL,
comprising of 2,100,000 shares of Rs. 10/- each.

Board of Directors:

The board of directors of SEFCL comprises of the following persons:

1. Mr.Umesh Revankar;
2. Mr. V.N. Kelkar and
3. Mr. Parag Sharma.

2. Shriram Automall India Limited, (“SAIL”):

SAIL was incorporated pursuant to a certificate of incorporation dated February 11, 2010 issued by the
Registrar of Companies, Chennai, Tamil Nadu and having its registered office situated at 123, Angappa
Naickan Street, Chennai 600001,Tamil Nadu, India.

Shareholding Pattern:

As on the date of this Prospectus our Company holds 100% of the paid-up equity share capital of SAIL,
comprising of 50,000 shares of Rs. 10/- each.

Board of Directors:

The board of directors of SAIL comprises of the following persons:

1. Mr. C.V.T Chari;

2. Mr. Raymond Rebello; and
3. Ms. Reena Mehra.

- 141 -
 SECTION V : FINANCIAL INFORMATION

Sl No. Particulars Page No.

1. Joint examination report on Reformatted Unconsolidated Summary F-1
Financial Statements as at and for the financial years ended March 31,
2005, 2006, 2007, 2008, 2009 and 2010, and as at and for the nine month
period between April 1, 2009 to December 31, 2009 of S. R. Batliboi &
Co. and G. D. Apte & Co.
2. Reformatted Unconsolidated Summary Financial Statements as at and for F-4
the years ended for the financial years ended March 31, 2005, 2006, 2007,
2008, 2009 and 2010, and as at and for the nine month period between
April 1, 2009 to December 31, 2009
3. Joint examination report on Reformatted Consolidated Summary Financial F-182
Statements as at and for the nine month period between April 1 2009 to
December 31, 2009, and as at and for the financial year ended March 31,
2010 of S. R. Batliboi & Co. and G. D. Apte & Co.
4. Reformatted Consolidated Summary Financial Statements as of and for the F-185
nine month period between April 1 2009 to December 31, 2009, and as at
and for the financial year ended March 31, 2010

- 142 -
S.R.BATLIBOI & Co. G. D. Apte & Co.
Chartered Accountants Chartered Accountants
6th Floor, Express Tower Dream Presidency
Nariman Point 1202 / 17E Shivajinagar
Mumbai – 400 021 Off Apte Road
Pune - 411 004

Auditors' report

To
The Board of Directors
Shriram Transport Finance Company Limited
3rd Floor, West Wing
Wockhardt Tower
Bandra Kurla Complex
Bandra – East
Mumbai – 400051

Dear Sirs,

1. We S.R.Batliboi & Co. (“SRB”) and G.D.Apte & Co. (“GDA”) have jointly examined the attached reformatted
unconsolidated financial information of Shriram Transport Finance Company Limited (‘Company’) as at and
for the year ended March 31, 2010, as at and for the nine months period ended December 31, 2009 and as at and
for the years ended March 31, 2009, 2008, 2007, 2006 and 2005 approved by an authorized delegate of the
Board of Directors and prepared by the Company in accordance with the requirements of:
a. paragraph B(1) of Part II of Schedule II to the Companies Act, 1956 ('the Act') and
b. the Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 ('the
Regulations') issued by the Securities and Exchange Board of India ('SEBI'), as amended from time to time
in pursuance of the Securities and Exchange Board of India Act, 1992 (the “SEBI Act”).
SRB and GDA are collectively referred to as the "Joint Auditors" and the references to the Joint Auditors as
"we", "us" or "our", in this letter, shall be construed accordingly.
2. We have examined such reformatted unconsolidated financial information taking into consideration:
a. the terms of reference dated March 8, 2010 received from the Company and statement of joint
responsibilities of auditors dated March 8, 2010, requesting us to carry out the assignment, in connection
with the Offer Document (‘OD’) being issued by the Company for its proposed public offer of non-
convertible debentures (‘NCDs’), having a face value and issue price of Rs. 1,000 each (referred to as the
'Offering') and
b. The Guidance Note on Reports in Company Prospectuses (Revised) issued by the Institute of Chartered
Accountants of India.

F-1
Reformatted Unconsolidated Financial information as per audited unconsolidated financial statements:
3. The reformatted unconsolidated financial information of the Company has been extracted by the management
from:

a. the Unconsolidated balance sheet of the Company as at March 31, 2010 and the related
Unconsolidated profit and loss account and Unconsolidated cash flow statement for the year ended
March 31, 2010, the Unconsolidated balance sheet as at December 31, 2009, and the related
Unconsolidated profit and loss account and Unconsolidated cash flow statement for the period April 1,
2009 to December 31, 2009, the Unconsolidated balance sheet as at March 31, 2009, 2008 and 2007
and the related Unconsolidated profit and loss account and Unconsolidated cash flow statement for the
year ended March 31, 2009, 2008 and 2007 (Collectively referred to as the “Audited Unconsolidated
Financial Statements”) jointly audited by us;

b. Unconsolidated balance sheet of the Company as at March 31, 2006 and 2005 and the related
Unconsolidated profit and loss account and Unconsolidated cash flow statement for the years ended
March 31, 2006 and 2005 (the “Audited Prior Year Unconsolidated Financial Statements”) solely
audited by GDA.

These audited unconsolidated financial statements and the audited prior year unconsolidated financial
statements have been approved by an authorized delegate of the Board of Directors. For the year ended March
31, 2006 and March 31, 2005 financial statements has been solely audited by GDA and accordingly reliance has
been placed by SRB on the financial statements for the said years. For the purpose of placing reliance on audit
reports of GDA, SRB has not performed any additional procedures to assess adequacy or otherwise of
procedures carried out by GDA for issuing these audit reports.

4. In accordance with the requirements of Paragraph B of Part II of Schedule II of the Act, the SEBI Regulations,
terms of our engagement agreed with you and statement of joint responsibilities of auditors, we further report
that:
a) The Reformatted Unconsolidated Summary Statement of Assets and Liabilities and the schedules forming
part thereof, Reformatted Unconsolidated Summary Statement of Profit and Loss and the schedules
forming part thereof and the Reformatted Unconsolidated Summary Statement of Cash Flow (‘Reformatted
Unconsolidated Summary Statements’) of the Company, including:
(i) as at and for the years ended March 31, 2006 and March 31, 2005 are solely examined and reported by
GDA on which no audit or procedures are performed by SRB and reliance is placed by SRB;
(ii) and as at and for the year ended March 31, 2010, as at and for the nine months period ended December
31, 2009 and as at and for the years ended March 31, 2009, 2008 and 2007, jointly examined by us;
have been set out in Annexure I to V to this report. These Reformatted Unconsolidated Summary
Statements are after regrouping in our opinion are appropriate and more fully described in Significant
Accounting Policies and Notes (Refer Annexure XIII)
b) Based on the above and also as per the reliance placed by SRB on the audit reports submitted by the GDA
for the respective years we state that:

the Reformatted Unconsolidated Summary Statements have to be read in conjunction with the notes
given in Annexure XIII;

the figures of earlier periods have been regrouped (but not restated retrospectively for change in
accounting policy), wherever necessary, to confirm to the classification adopted for the Reformatted
Unconsolidated Summary Statement as at/for the year ended March 31, 2010;

there are no extraordinary items which need to be disclosed separately in the reformatted
unconsolidated summary statements; and

there are no qualifications in the auditors’ reports, which require any adjustments to the reformatted
unconsolidated summary statements.

F-2
 5. We have not jointly audited any unconsolidated financial statements of the Company as of any date or for
any period subsequent to March 31, 2010. Accordingly, we express no opinion on the financial position,
results of operations or cash flows of the Company as of any date or for any period subsequent to March
31, 2010.

Other unconsolidated Financial Information:

6. At the Company’s request, we have also examined the following unconsolidated financial information
proposed to be included in the OD prepared by the management and approved by an authorized delegate of
the Board of Directors of the Company and annexed to this report relating to the Company as at and for the
year ended March 31, 2010, as at and for the nine months period ended December 31, 2009 and as at and
for the years ended March 31, 2009, 2008, 2007, 2006 and 2005. In respect of the years ended March 31,
2006 and 2005 this information have been included based on the audit reports submitted by the GDA and
relied upon by SRB:

i. Statement of contingent liabilities, enclosed as Annexure VI

ii. Statement of dividend paid/proposed, enclosed as Annexure VII
iii. Statement of accounting ratios relating to earnings per share, net asset value, return on networth,
enclosed as Annexure VIII
iv. Statement of Secured and Unsecured Loans including terms and conditions, enclosed as Annexure IX
&X
v. Capitalization Statement as at March 31, 2010, enclosed as Annexure XI
vi. Statement of tax shelters, enclosed as Annexure XII

7. In our opinion, the reformatted unconsolidated financial information as disclosed in the annexures to this
report, read with the respective significant accounting policies and notes disclosed in Annexure XIII, and
after making re-groupings as considered appropriate and disclosed, has been prepared in accordance with
Paragraph B(1) of Part II of Schedule II of the Act and the Regulations.
8. This report should not be in any way construed as a reissuance or redating of any of the previous audit
reports issued by us or by other firm of Chartered Accountants, nor should this report be construed as a new
opinion on any of the reformatted unconsolidated financial statements referred to herein.
9. We have no responsibility to update our report for events and circumstances occurring after the date of the
report for the financial position, results of operations or cash flows of the Company as of any date or for
any period subsequent to March 31, 2010.
10. This report is intended solely for your information and for inclusion in the OD in connection with the
Offering of the Company, and is not to be used, referred to or distributed for any other purpose without our
prior written consent.

For S.R.BATLIBOI & Co. For G.D.Apte & Co.

Firm registration number: 301003E Firm registration number: 100515W
Chartered Accountants Chartered Accountants

per Shrawan Jalan per U. S. Abhyankar

Partner Partner
Membership No.: 102102 Membership No.: 113053
Mumbai, May 3, 2010 Mumbai, May 3, 2010

F-3
 Annexure I
Shriram Transport Finance Company Limited

Reformatted summary of Assets and Liabilities

(Rs. in lacs)
Sc
As at
he As at
Particulars December As at March 31,
du March 31,
31,
le
2010 2009 2009 2008 2007 2006 2005

Assets

A Fixed and Intangible

Assets (Net) (including
CWIP) 1 4,644.51 4,899.34 13,426.57 14,264.44 16,746.53 15,722.12 4,912.41

B Investments 2 185,601.67 125,493.97 65,476.33 138,512.02 22,457.16 915.42 407.49

C Deferred Tax Asset

(Net) 7,472.13 5,404.50 2,639.48 - - - -

D Current Assets 3 2,255,253.32 2,662,392.95 2,378,100.16 1,654,704.81 1,023,399.87 572,319.69 181,788.15

E Other loans &

Advances 4 240,963.09 66,503.40 40,306.00 19,422.18 20,946.78 17,945.76 9,458.96

F Total (A+B+C+D+E) 2,693,934.72 2,864,694.16 2,499,948.54 1,826,903.45 1,083,550.34 606,902.99 196,567.01

Liabilities

G Secured Loans 5 1,517,248.07 1,914,975.11 1,677,459.31 1,154,494.87 630,015.59 374,201.79 129,998.95

H Unsecured Loans 6 328,742.89 340,637.49 334,671.85 322,807.83 239,495.26 65,279.01 16,115.93

I Deferred Tax Liability

(Net) - - - 3,592.21 8,661.98 13,368.85 5,349.98

J Current Liabilities 7 390,860.61 249,733.73 212,883.25 137,321.90 81,445.50 61,279.78 20,189.65

K Provisions 8 76,553.32 53,383.85 43,270.53 27,050.74 15,304.49 8,924.98 2,611.34

L Total (G+H+I+J+K) 2,313,404.89 2,558,730.18 2,268,284.94 1,645,267.55 974,922.82 523,054.41 174,265.85

M Net Worth (F-L) 380,529.83 305,963.98 231,663.60 181,635.90 108,627.52 83,848.58 22,301.16

Represented By
(i) Share Capital 9 22,554.18 21,279.86 20,353.56 20,315.94 18,418.27 16,921.05 9,073.50
(ii) Share application
money pending
allotment 5.22 12.97 13.80 21.37 - - -
(iii) Stock Option
Outstanding 757.02 1,497.93 2,138.90 1,826.64 1,227.38 353.49 -

F-4
 Shriram Transport Finance Company Limited Annexure I

Reformatted summary of Assets and Liabilities

(Rs. in lacs)
Sc
As at
he As at
Particulars December As at March 31,
du March 31,
31,
le
2010 2009 2009 2008 2007 2006 2005
(iv) Optionally Convertible
warrants - - 2,400.00 2,400.00 772.80 1,992.03 103.81
(v) Reserves and Surplus 10 360,922.10 286,716.43 206,757.34 157,071.95 88,222.80 64,623.18 13,168.28
(vi) Less : Miscellaneous
Expenditure (to
the extent not written
off or adjusted) 11 3,708.69 3,543.21 - - 13.73 41.17 44.43
Total (i+ii+iii+iv+v-vi) 380,529.83 305,963.98 231,663.60 181,635.90 108,627.52 83,848.58 22,301.16

The accompanying statement of Significant Accounting Policies and Notes to Accounts on Summary Financial Statements are integral part of
this statement.

As per our report of even date

For S.R.BATLIBOI & Co. For G. D. Apte & Co. For and on behalf of the Board of Directors of
Firm Registration No. 301003E Firm Registration No.100515W Shriram Transport Finance Company Limited

Chartered Accountants Chartered Accountants

per Shrawan Jalan U. S. Abhyankar R Sridhar S. Venkatakrishnan

Partner Partner Managing Director Director
Membership No. 102102 Membership No. 113053

K. Prakash
Mumbai Vice President (Corporate Affairs) & Company Secretary

F-5
 Annexure II
Shriram Transport Finance Company Limited
Reformatted summary of Profit and Loss Account

(Rs. in lacs)
For the For the
Sc year period
he ended April 01, For the year ended March 31,
Particulars
dul March 2009 to
e 31, 2010 December
31, 2009 2009 2008 2007 2006 2005

A. Income

i Income from Operations 12 440,282.74 320,857.46 365,918.77 245,328.68 140,299.54 88,534.58 33,831.76

ii Other Income 13 9,681.08 6,181.88 7,194.20 5,574.00 1,839.06 2,095.93 737.08

Total Income 449,963.82 327,039.34 373,112.97 250,902.68 142,138.60 90,630.51 34,568.84

B. Expenditure

i Interest & Other Charges 14 224,678.93 167,377.84 197,767.21 129,661.64 73,833.11 41,913.24 16,561.34
ii Raw Material Consumed 15 - - 687.17 258.06 - - -
iii Personnel Expenses 16 22,508.15 16,396.29 20,053.60 12,547.76 7,263.39 4,776.62 1,421.88
iv Operating & Other Expenses 17 27,258.22 19,637.47 27,925.50 19,463.22 13,788.10 13,162.37 6,078.91
v Depreciation and 1,495.84 1,196.22 3,480.59 3,705.97 1,281.85 969.02 352.03
amortisation
vi Impairment loss/(Reversal)
on Fixed assets & stock - - 560.87 - (296.72) 9.97 119.63
viii Share & Debenture Issue
expenses written off 18 498.70 394.28 - 13.74 27.44 39.35 22.85
viii Provisions & Write offs (net) 19 41,064.86 30,842.97 30,574.92 24,668.99 17,319.01 8,143.07 2,225.31

Total Expenditure 317,504.70 235,845.07 281,049.86 190,319.38 113,216.18 69,013.64 26,781.95

C. Net Profit Before Taxation

(A-B) 132,459.12 91,194.27 92,063.11 60,583.30 28,922.42 21,616.87 7,786.89

D. Provision for taxation

Current tax 49,980.03 33,090.61 34,998.86 26,387.42 14,445.62 5,984.29 1,464.23

Deferred tax (4,832.65) (2,765.02) (4,477.15) (5,069.77) (4,706.87) 1,345.26 1,390.28
Fringe Benefit Tax - - 301.19 283.00 143.96 123.22 -

Total Tax 45,147.38 30,325.59 30,822.90 21,600.65 9,882.71 7,452.77 2,854.51

E. Net Profit after Taxation

(C-D) 87,311.74 60,868.68 61,240.21 38,982.65 19,039.71 14,164.10 4,932.38

Balance in Profit & Loss

Account brought forward 58,309.25 58,309.25 27,486.21 12,248.92 5,322.65 3,396.32 1,914.29
on amalgamation of SIL - - - - - 3,387.15 -
on amalgamation of
SOFL - - - - - 106.96 -

F-6
 Annexure II
Shriram Transport Finance Company Limited
Reformatted summary of Profit and Loss Account
(Rs. in lacs)
For the For the
Sc year period
he ended April 01,
Particulars For the year ended March 31,
dul March 2009 to
e 31, 2010 December
31, 2009
2009 2008 2007 2006 2005
Provision for Dividend no
longer required - - - - - - 4.76

F. Balance Available for

Appropriations 145,620.99 119,177.93 88,726.42 51,231.57 24,362.36 21,054.53 6,851.43

G. Appropriations

Dividend - Cumulative
Redeemable Preference
Shares - - - - - 423.67 228.21
Equity Shares - Interim 519.50
dividend 4,254.76 4,254.76 2,035.03 2,031.35 1,749.01 4,271.43
Equity Shares - Final
dividend 325.18 325.18 10.52 138.85 - - -
Equity Shares - Proposed
final dividend 9,020.71 - 8,140.46 8,125.42 3,683.17 559.38 981.43
Tax on dividend 2,276.61 778.36 1,731.16 1,749.74 871.26 736.95 225.97
Short Provision for
Dividend Tax of previous
Year - - - - - 18.09 -
Transfer to statutory reserve 17,500.00 - 12,300.00 7,800.00 3,810.00 2,834.01 1,000.00
Transfer to general reserve 8,800.00 - 6,200.00 3,900.00 2,000.00 1,500.00 500.00
Transfer to Capital
Redemption Reserve - - - - - 5,388.35 -
Transfer to debenture
redemption reserve 10,442.08 6,802.27 - - - - -

Total Appropriations 52,619.34 12,160.57 30,417.17 23,745.36 12,113.44 15,731.88 3,455.11

H. Balance carried to Balance

Sheet (F-G) 93,001.65 107,017.36 58,309.25 27,486.21 12,248.92 5,322.65 3,396.32

The accompanying statement of Significant Accounting Policies and Notes to Accounts on Summary Financial Statements
are integral part of this statement.

F-7
As per our report of even date
For S.R.BATLIBOI & Co. For G. D. Apte & Co. For and on behalf of the Board of Directors of
Firm Registration No. 301003E Firm Registration No.100515W Shriram Transport Finance Company Limited
Chartered Accountants Chartered Accountants

per Shrawan Jalan U. S. Abhyankar R Sridhar S. Venkatakrishnan

Partner Partner Managing Director Director
Membership No. 102102 Membership No. 113053
K. Prakash
Mumbai Vice President (Corporate Affairs) & Company Secretary

F-8
 Annexure III
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED

Reformatted Summary of Cash Flow Statement -

(Rs. in lacs)
For the year For the year ended March 31,
For the period
ended 2009 2008 2007 2006 2005
April 01, 2009
Particulars March 31, to December
2010 31, 2009

A. Cash flow from operating

activities
Net profit before taxation 132,459.12 91,194.27 92,063.11 60,583.30 28,922.42 21,616.87 7,786.89
Depreciation and amortisation 1,495.84 1,215.26 3,480.59 3,705.97 1,281.85 969.02 352.03
Issue expenses for equity
shares 25.28 - - - - - -
Public issue expenses for non
convertible debentures 473.42 394.28 - - - - -
Share and debenture issue
expenses written off - - - 13.74 27.44 39.35 22.85
(Profit) / loss on sale of fixed
assets (net) (62.40) (88.78) 87.77 17.39 231.02 33.00 7.63
(Profit) / loss on sale of current
and long term investments (net) (1,812.65) (822.32) (512.61) (717.70) (11.65) (19.06) (6.84)
Interest income on current and
long term investments and
interest income on fixed (3,178.28) (1,574.91) (2,767.69) (2,967.86) (398.96) (347.78) (121.07)
deposits
Dividend income (874.71) (874.71) (486.91) (519.33) (20.84) (2.13) (0.06)

Employees Stock option

compensation cost 341.30 292.00 580.57 653.95 987.16 353.49 -
Provision for impairment of
windmill - - 560.87 - (248.28) - 70.15
Provision for impairment -
others - - - - (48.44) 9.97 49.48
Provision for hedging contracts - - (705.44) 690.42 15.02 - -
Provision for credit loss on
securitisation 7,971.84 3,317.30 4,464.01 2,009.30 1,640.19 - -
Provisions for non performing
assets and bad debts written off
33,622.02 27,901.02 26,794.90 21,875.36 15,742.63 8,322.05 2,217.12
Provision for gratuity 148.71 119.91 141.16 148.45 22.92 19.67 6.40
Provision for leave encashment 146.44 119.59 227.65 120.73 (0.82) 12.50 5.00
Provision for diminution in
value of investments 20.34 21.67 81.14 60.67 (167.60) 11.79 19.85
Operating profit before
working capital changes 170,776.27 121,214.58 124,009.12 85,674.39 47,974.06 31,018.74 10,409.43
Movements in working
capital:
(Increase) / decrease in
current assets:
(Increase) / decrease in
inventories 126.81 126.81 (60.28) (66.53) - - -
(Increase) / decrease in Assets
under financing activities (19,813.77) (372,426.81) (294,777.86) (692,459.86) (308,228.67) (248,606.35) (68,774.96)
(Increase) / decrease in sundry
debtors 399.24 399.24 (151.13) 100.56 402.91 (556.59) -
(Increase) / decrease in lease
assets - net of sales - - - - 0.56 1.16 5.77

F-9
 Annexure III
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED
Reformatted Summary of Cash Flow Statement
(Rs. in lacs)
For the year
ended For the period
April 01, 2009
Particulars March 31, to December
For the year ended March 31,
2010 31, 2009

2009 2008 2007 2006 2005

Increase) / decrease in other
current assets (1,008.93) (58,380.86) (835.19) (1,686.67) (476.78) - -
(Increase) / decrease in other
loans and advances (201,034.75) (26,199.89) (22,878.25) 1,776.17 (3,384.80) 5,980.88 (64.36)
Increase / (decrease) in current
liabilities 185,950.33 38,542.14 74,207.62 57,180.20 22,326.43 18,306.00 6,437.64
Cash generated from
operations 135,395.20 (296,724.79) (120,485.97) (549,481.74) (241,386.29) (193,856.16) (51,986.48)
Direct taxes paid (net of
refunds) (48,629.16) (33,095.56) (35,067.48) (26,899.61) (14,205.81) (6,480.97) (1,832.63)
Net cash used in operating
activities (A) 86,766.04 (329,820.35) (155,553.45) (576,381.35) (255,592.10) (200,337.13) (53,819.11)

B. Cash flows from investing

activities
Investment in Fixed deposits
(net) (88,988.21) (62,129.42) (47,214.27) (33,178.65) (32,445.92) 9,179.84 (1,331.52)
Purchase of fixed assets and
intangible assets (624.86) (544.02) (3,369.47) (5,252.92) (1,622.25) (1,075.00) (127.29)
Change in capital work in
progress(fixed and intangible
assets) - - - 3,986.91 (1,414.06) (2,244.05) (4.05)
Proceeds from sale of fixed
assets 7,973.48 7,944.77 78.10 24.70 746.91 302.00 2.41
Purchase of Investment (2,501,835.74) (1,418,400.94) (64,790.83) (776,661.44) (21,364.74) - -
Investment in associate
company - - - (30.00) (180.00) - -
Investment in subsidiary
company (220.00) (214.99) - - (4.99) - -
Proceeds from sale of
investment in subsidiary
company 5.00 5.00 - 4.99 - - -
Proceeds from sale of
investment in associate
company - - - 112.50 - - -
Proceeds from sale of
investments 2,383,738.05 1,359,415.61 138,339.14 661,221.69 19.63 78.58 6.84
Interest received on current and
long term investments and 2,896.30 2,025.23 2,825.79 2,548.54 423.01 1,836.35 137.44
interest on fixed deposits
Dividend received 874.71 874.71 486.91 519.33 20.84 2.13 0.06
Net cash used in investing
activities (B) (196,181.27) (111,024.05) 26,355.37 (146,704.35) (55,821.57) 8,079.85 (1,316.11)

C. Cash Flows from

financing activities
Proceeds from issue of equity
share capital including
securities premium & Share
application 80,799.14 22,041.21 124.09 43,003.42 11,028.07 30,687.67 6,107.40
Redemption of preference
shares - - - (5,388.35) -

F-10
 Annexure III
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED

Reformatted Summary of Cash Flow Statement

(Rs. in lacs)
For the year
ended For the period
April 01, 2009
Particulars March 31, to December
For the year ended March 31,
2010 31, 2009

2009 2008 2007 2006 2005

Proceeds from issue of share
warrants - 2,400.00 - 1,792.00 103.81
Increase / (decrease) in bank
borrowings (net) (110,368.28) 219,120.27 320,120.96 443,172.48 278,640.26 116,255.06 18,849.14
Increase / (decrease) in long
term borrowings from others
(net) (68,604.27) (40,515.12) (41,471.04) 27,824.90 85,438.50 18,041.38 12,430.57
Increase / (decrease) in fixed
deposits (net) 10,991.06 7,802.15 146.45 (763.73) (342.36) (1,325.98) (219.51)
Increase / (decrease) in
subordinate debts (net) 51,823.24 36,906.16 55,816.44 30,577.18 29,924.71 13,225.78 9,401.10
Increase / (decrease) in
redeemable non convertible
debentures (net) 408.53 70,550.19 169,124.14 119,111.61 2,368.94 10,126.91 14,433.61
Increase / (decrease) in inter
corporate deposits and
commercial papers (net) (50,390.48) (50,382.21) 31,091.52 (12,214.36) 34,000.00 (331.71) (15.00)
Issue expenses for equity
shares paid (1,415.53) - - - - - -
Public issue expenses for non
convertible debentures paid (2,690.64) (3,937.49) - - - - -
Dividend paid (12,720.40) (12,720.40) (10,170.96) (5,853.38) (5,320.67) (3,575.25) (1,528.17)
Tax on dividend (2,161.83) (2,161.83) (1,728.56) (994.78) (746.23) (519.52) (198.32)
Net cash from financing
activities (C) (104,329.46) 246,702.93 523,053.04 646,263.34 434,991.22 178,987.99 59,364.63
Net increase / (decrease) in
cash and cash equivalents (A
+ B + C) (213,744.69) (194,141.47) 393,854.96 (76,822.36) 123,577.55 (13,269.29) 4,229.41

Cash and Cash Equivalents

at the beginning of the year 461,054.26 461,054.26 67,199.30 144,021.66 20,444.11 33,713.40 * 13,420.96
Cash and Cash Equivalents
at the end of the year 247,309.57 266,912.79 461,054.26 67,199.30 144,021.66 20,444.11 17,650.37

F-11
 Annexure III
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED

Reformatted Summary of Cash Flow Statement

(Rs. in lacs)
Components of Cash and As at March As at
As at March 31,
Cash Equivalents 31, December 31
2010 2009 2009 2008 2007 2006 2005
Cash on hand 7,818.91 2,469.68 7,062.48 5,639.48 2,281.08 1,756.21 563.37
Cheques on hand 2,220.79 2,614.89 1,490.15 856.52 215.76 54.65 80.15
Remittances in transit 9.48 144.00 10.16 193.69 2,375.05 829.39 66.20
With Banks - in Current
Account 166,008.69 163,186.32 95,601.30 45,275.37 26,253.34 15,584.83 16,800.73
- in unpaid dividend accounts
$ 274.83 294.26 165.70 109.36 160.05 125.48 139.92
-in fixed deposits (Original
maturity being three months
or less) 70,976.87 98,203.64 356,724.47 15,124.88 112,736.38 2,093.55 -
247,309.57 266,912.79 461,054.26 67,199.30 144,021.66 20,444.11 17,650.37

Note:
* Cash and Cash Equivalents at the beginning of the year for the year 2006 includes cash and cash equivalents of M/s. Shriram Investments
Limited Rs. 15,792.04 Lacs and of M/s Shriram Overseas Finance Limited Rs. 270.99 Lacs. The same is not included in Cash and cash equivalents
at the end of the year 2005.
$ These balances are not available for use by the Company as they represent corresponding unpaid dividend liability.

As per our report of even date

For S.R.BATLIBOI & Co. For G. D. Apte & Co. For and on behalf of the Board of Directors of
Firm Registration No. 301003E Firm Registration No.100515W Shriram Transport Finance Company Limited
Chartered Accountants Chartered Accountants

per Shrawan Jalan U. S. Abhyankar R Sridhar S. Venkatakrishnan

Partner Partner Managing Director Director
Membership No. 102102 Membership No. 113053

K. Prakash
Mumbai Vice President (Corporate Affairs) & Company Secretary

F-12
 Annexure IV
Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Assets and Liabilities

(Rs. in lacs)
As at As at
Schedule 1 - Fixed and
March December As at March 31,
Intangible Assets (Net)
31, 31,
(including CWIP)
2010 2009 2009 2008 2007 2006 2005

ASSETS FOR OWN USE

Tangible Fixed Assets
Building 392.58 394.38 396.91 193.58 197.65 313.16 164.13
Leasehold Improvements 1,271.41 1,450.25 1,883.74 1,061.60 - - -
Furniture & Fixtures 710.65 712.50 705.39 443.95 1,726.49 1,266.88 390.62
Vehicles 73.41 91.68 143.78 320.12 374.90 357.64 11.02
Land - Freehold 10.18 10.18 153.96 153.96 153.96 222.99 2.05
Land - Leasehold - - - - 452.24 -
Plant and Machinery 1,879.12 1,922.74 *9,869.96 11,602.71 9,917.46 10,102.55 4,166.55

Intangible Assets
Software 69.28 78.85 28.40 243.53 138.90 171.84 -

Capital Work In Progress

(including Capital Advances) - - - 3,986.91 2,572.85 21.53
TOTAL (A) 4,406.63 4,660.58 13,182.14 14,019.45 16,496.27 15,460.15 4,755.90

ASSETS GIVEN ON LEASE

Plant and Machinery - - - - 1.71 9.86 -
Vehicles 1.14
Land 69.75 69.75 69.75 69.75 69.75 69.75 -
Buildings 168.13 169.01 174.68 175.24 178.80 182.36 155.37
TOTAL (B) 237.88 238.76 244.43 244.99 250.26 261.97 156.51
TOTAL (A+B) 4,644.51 4,899.34 13,426.57 14,264.44 16,746.53 15,722.12 4,912.41

*Includes Rs 5,314.67 lacs towards windmills held for sale for which MOU is executed with a buyer and sale will be
subject to satisfactory completion of the technical due diligence.

F-13
 Annexure IV
Shriram Transport Finance Company Limited
Schedules to the Reformatted Statement of Assets and Liabilities
(Rs. in lacs)
As at
As at March
December As at March 31,
Schedule 2 - Investments 31,
31,
2010 2009 2009 2008 2007 2006 2005

LONG TERM (at cost)

Trade
Shares : Fully paid up

Unquoted - Preference Share 10.00 10.00 10.00 - - - -

Other Than Trade

Quoted :
Government Securities 3,497.70 3,053.81 283.00 427.44 592.29 597.34 277.78
Equity Shares (Fully paid up)
- Associates - - - 240.00 240.00 240.00 120.00
- Others - - - - 0.71 3.62
-
Investment in Debentures - - - - - 0.03 -

Unquoted :
Equity Shares (Fully paid up)
- subsidiary 215.00 209.99 - - - - -
- Associates - - - - 180.00 - -
- Others 207.50 207.50 207.50 162.50 74.36 74.36 9.71
Investment in Pass Through Certificates 4,284.55 - 2,322.01 750.00 750.00 - -
Investment in NSC - - - - 0.07 0.07 -

CURRENT INVESTMENTS (at

lower of cost and market value)
Other Than Trade
Quoted :
Equity Shares (Fully paid up)
- Associates 240.00 240.00 240.00 - - - -

Unquoted :
Equity Shares (Fully paid up)
- Subsidiary - - - 4.99 - -
Investment in Units of Mutual Funds - - - 20,614.74 - -
Investment in Certificate of deposits 177,146.92 121,772.67 62,413.82 136,932.08 - - -
with Banks
185,601.67 125,493.97 65,476.33 138,512.02 22,457.16 915.42 407.49

Book value of Quoted investments 3,737.70 3,293.81 523.00 667.44 833.00 840.99 397.78
Market value of Quoted investments 4,030.61 3,573.63 535.42 913.90 937.49 934.08 323.12
Book value of Unquoted investments 181,863.97 122,200.16 64,953.33 137,844.58 21,624.16 74.43 9.71

Details of investments may be referred from the annual report of the respective years

F-14
 Annexure IV
Shriram Transport Finance Company Limited
Schedules to the Reformatted Statement of Assets and Liabilities
(Rs. in lacs)
As at As at March 31,
Schedule 3 - Current As at March
December 31,
Assets 31, 2010 2009 2008 2007 2006 2005
2009

Inventories- Raw
Materials (at lower of
cost and net realisable - - 126.81 66.53 - - -
value)

Assets under financing

activities (considered
good unless stated
otherwise) *
Secured
Stock under Hire Purchase
agreement - - - - 5,721.72 27,473.86 28,703.54
Assets given on Financial
lease - - - 7,042.41 21,691.52 39,086.19 25,425.18
Hypothecation loans 1,773,740.20 2,135,742.85 1,791,200.42 1,500,224.10 793,068.46 464,717.20 100,579.10
Other loans 1,216.58 1,246.77 1,330.35 2,100.27 4,328.29 5,142.99 3,105.38
Unsecured
Unsecured Loans 21,410.26 16,917.57 2,406.89 1,946.23 - 31.07 35.00
Advance - Hypothecation
loans/Hire purchase/ 128.21 343.63 412.81 2,699.85 16,326.18 9,677.97 1,932.18
Lease Assets

1,796,495.25 2,154,250.82 1,795,350.47 1,514,012.86 841,136.17 546,129.28 159,780.38

* includes non
performing assets 51,126.65 52,303.87 38,411.39 23,843.32 17,404.19 6,705.74 2,280.80

Sundry Debtors
(Unsecured, considered
Good)
Debts outstanding for a
period exceeding six - - - - 262.21 367.55 89.51
months
Other debts - - 399.24 248.11 86.46 384.03 105.48
- - 399.24 248.11 348.67 751.58 194.99
Cash & Bank Balances
i) Cash on hand 7,818.91 2,469.68 7,062.48 5,639.48 2,281.08 1,756.21 563.37
ii) Cheques on hand 2220.79 2,614.89 1,490.15 856.52 215.76 54.65 80.15
iii) Remittances in transit 9.48 144.00 10.16 193.69 2,375.05 829.39 66.20
iv) Balances with
scheduled banks in:
Current accounts 166,283.52 163,480.58 95,767.00 45,384.73 26,413.39 15,710.31 16,940.65
Fixed Deposit
Accounts# 277,400.51 277,768.49 474,159.90 85,346.03 149,778.88 6,690.13 4,034.12

453,733.21 446,477.64 578,489.69 137,420.45 181,064.16 25,040.69 21,684.49

Other current assets
Interest accrued on
investments 666.89 93.45 222.00 255.70 46.26 21.38 9.48

F-15
 Annexure IV
Shriram Transport Finance Company Limited
Schedules to the Reformatted Statement of Assets and Liabilities
(Rs. in lacs)
As at
Schedule 3 - Current As at March
December 31, As at March 31,
Assets 31, 2010
2009
2009 2008 2007 2006 2005
Interest accrued on fixed
deposits and other loans
and advances 4,357.97 5,576.00 3,511.95 2,701.16 804.61 376.76 118.81
Lending through
Collateralised Borrowing
and Lending Obligation - 55,995.04 - - - - -

2,255,253.32 2,662,392.95 2,378,100.16 1,654,704.81 1,023,399.87 572,319.69 181,788.15

# Includes Fixed deposits

pledged with Banks as 197,421.41 178,712.56 114,596.62 63,537.58 33,008.45 4,054.25 3,327.09
margin for securitisation
# Includes Fixed deposits
pledged with Banks as as 8,534.94 415.53 775.42 1,252.86 3,629.44 1,974.42 1,092.61
lien against loans taken

As at As at March 31,
Schedule 4 - Other As at March
December
Loans and Advances 31, 2010 2009 2008 2007 2006 2005
31, 2009

Unsecured, Considered
Good

Advances recoverable
from subsidiaries 5.05 2.64 - - - - -
Advances recoverable in
cash or in kind or for
value to be received 229,668.89 56,211.57 24,956.17 13,094.79 12,808.48 9,260.21 2,947.68
Service tax credit (input)
receivable 537.34 863.37 1,099.54 1,489.39 1,651.74 635.24 148.96
Advance income tax (net
of provisions for tax) - 375.17 377.66 2,372.02 2,120.47 2,425.57 646.44
Advance fringe benefit
tax (net of provision for - - - - - 78.68 -
tax)
Prepaid expenses 8,649.99 8,368.94 13,086.96 1,589.87 2,776.53 594.96 182.76
Inter-corporate deposits# 1,379.21 - - 55.00 131.85 247.00 -
Security deposits** 722.61 681.71 785.67 821.11 1,457.71 4,704.10 5,533.12

240,963.09 66,503.40 40,306.00 19,422.18 20,946.78 17,945.76 9,458.96

** includes deposit
pledged as margin on
securitisation Nil Nil Nil 277.32 323.98 Nil Nil
# includes deposit
pledged as lien against
loans taken Nil Nil Nil 55.00 131.85 247.00 Nil

F-16
 Annexure IV
Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Assets and Liabilities

(Rs. in lacs)
As at March 31,
Schedule 5 - Secured As at March As at December
Loans 31, 2010 31, 2009 2009 2008 2007 2006 2005

Redeemable non
convertible debentures 483,087.87 553,229.53 482,679.34 312,255.20 183,799.02 184,430.08 86,558.36
refer note 1(a)(i)(ii)(iii) 1(a)(i)(ii)(iii) 1(a)(i)(ii)(iii) 1(a)(i)(ii)(iii) 1(a)(i)(ii)(iii) A(1)(a)(i)(ii) 1(a)

Term loans
i) From Financial
institutions / Foreign
institutions / Corporates 12,188.42 40,277.57 44,792.69 111,263.73 82,272.73 43,557.74 19,250.29
refer note 1(b)(i)(ii) 1(b)(i) 1(b)(i)(ii) 1(b)(i)(ii) 1(b)(i)(ii) A(1)(b)(i)(ii) 1(b)(i)(ii)

ii) From banks 929,935.14 972,557.48 833,363.58 505,329.28 259,825.48 91,282.84 21,032.39
refer note 1(b)(iii) 1(b)(ii) 1(b)(iii) 1(b)(iii) 1(b)(iii) A(1)(b)(iii) 1(b)(iii)

Cash credit from banks 92,036.64 348,910.53 316,623.70 225,646.66 104,118.36 54,820.74 3,157.91
refer note 1(c ) 1(c ) 1(c ) 1(c ) 1(c ) A(1)(c ) 1(c )

HP refinance loan - - - - - 110.39 -

refer note A(1)(d )

1,517,248.07 1,914,975.11 1,677,459.31 1,154,494.87 630,015.59 374,201.79 129,998.95

F-17
 Annexure IV
Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Assets and Liabilities

(Rs. in lacs)
As at As at As at March 31,
Schedule 6 -
March 31, December 31, 2009 2008 2007 2006 2005
Unsecured Loans
2010 2009

Fixed deposits 11,479.51 8,290.59 488.44 342.00 1,105.73 1,448.09 1,175.15

Inter corporate
deposits 16.68 24.95 4,657.16 120.64 30.00 30.00 15.00

Subordinated debts 206,599.49 191,682.41 154,776.25 98,959.81 68,443.43 38,518.72 12,425.78

Redeemable non-
convertible
debentures 2,500.00 2,500.00 2,500.00 3,800.00 13,000.00 10,000.00 2,500.00

Commercial papers 2,500.00 2,500.00 48,250.00 21,695.00 34,000.00 - -

Term loan :
i) From banks 70,647.21 100,639.54 53,000.00 151,890.38 75,750.00 14,950.00 -

ii) From corporates 35,000.00 35,000.00 71,000.00 46,000.00 47,166.10 332.20 -

328,742.89 340,637.49 334,671.85 322,807.83 239,495.26 65,279.01 16,115.93

F-18
 Annexure IV

Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Assets and Liabilities

(Rs. in lacs)

As at As at As at March 31,
Schedule 7 - Current
March 31, December
Liabilities 2009 2008 2007 2006 2005
2010 31, 2009

Sundry creditors other than

Micro and Small Enterprises
23,288.59 22,194.28 21,876.31 7,129.06 3,028.68 1,912.72 415.91
Caution and lease deposits - - 10.21 365.57 267.98
Interest accrued but not due
on loans 84,941.79 82,446.07 77,718.04 55,751.58 34,759.79 34,691.29 13,954.75
Unclaimed Redeemable
Preference Shares - - - 102.64 149.25 163.58 -
Application money on
Redeemable non convertible
debentures 798.77 1,005.19 1,030.19 895.21 1,039.78 102.10 1.64
Application money on
Subordinated debts 15.79 25.91 2,942.35 437.17 376.37 25.82 -
Investor Education and
Protection Fund shall be
credited by the following
amounts (as and when due)
- Unclaimed Matured
Deposits 60.65 68.30 65.30 52.00 64.36 108.10 92.51
- Unclaimed Matured
Debentures 5,116.68 6,029.85 4,503.36 5,381.81 2,314.19 3,293.18 1,609.45
- Unclaimed Matured
Subordinated Debts 117.13 68.21 816.45
- Interest accrued and due on
above 1,329.00 1,495.70 1,591.38 1,940.80 537.81 599.30 372.96
- Unclaimed dividend 269.67 289.10 166.26 126.11 108.81 126.05 57.98
Temporary credit balance in
bank accounts 29,551.21 31,931.95 41,990.51 12,394.79 5,930.09 10,099.25 723.77
Securitization deferred
income 236,518.83 94,410.58 51,334.24 44,092.11 24,133.29 488.09 -

Other liabilities 8,852.50 9,768.59 8,848.86 9,018.62 8,992.87 9,304.73 2,692.70

390,860.61 249,733.73 212,883.25 137,321.90 81,445.50 61,279.78 20,189.65

F-19
 Annexure IV

Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Assets and Liabilities

(Rs. in lacs)
As at As at As at March 31,
Schedule 8 - Provisions March 31, December
2010 31, 2009 2009 2008 2007 2006 2005

Non-performing assets 38,637.89 38,059.42 23,684.86 10,330.21 6,540.36 4,365.42 1,332.15

Credit loss on securitisation 24,986.49 13,949.42 8,940.46 5,830.18 4,098.52 - -
Income tax (net of advance
tax) 980.65 - - - - - -
Fringe benefit tax (net of
advance tax) 7.67 7.67 15.11 22.36 - - -
Diminution in value of
investments 247.37 248.70 227.03 145.89 100.31 267.91 103.85
Hedging contracts - - 705.44 15.02 - -
Leave encashment and
availment 561.66 534.81 415.22 187.57 66.85 67.67 24.43
Gratuity 612.63 583.83 463.92 322.76 174.31 151.39 41.20
Proposed dividend 9,020.71 - 8,140.46 8,125.42 3,683.17 3,570.19 981.43
Dividend on preference
shares - - - - - 1.47 0.02
Corporate dividend tax 1,498.25 - 1,383.47 1,380.91 625.95 500.93 128.26

76,553.32 53,383.85 43,270.53 27,050.74 15,304.49 8,924.98 2,611.34

F-20
 Annexure IV

Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Assets and Liabilities

(Rs. in lacs)
As at December
Schedule 9 - Share As at March 31, As at March 31,
31,
Capital
2010 2009 2009 2008 2007 2006 2005

Authorised
Equity Share Capital 33,500.00 33,500.00 33,500.00 33,500.00 33,500.00 33,500.00 7,500.00
Preference Share
Capital 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 20,000.00 5,000.00

53,500.00 53,500.00 53,500.00 53,500.00 53,500.00 53,500.00 12,500.00

No. of equity Shares

of Rs.10/- each 335,000,000 335,000,000 335,000,000 335,000,000 335,000,000 335,000,000 75,000,000
No. of preference
Shares of Rs.100/-
each 20,000,000 20,000,000 20,000,000 20,000,000 20,000,000 20,000,000 5,000,000

Issued, Subscribed
& Fully Paid up

Equity Shares 22,551.78 * 21,277.46 * 20,351.16 * 20,313.54 * 18,415.87 * 15,054.06 ** 6,542.85

No. of equity shares

of Rs. 10/- each 225,517,818 212,774,566 203,511,616 203,135,416 184,158,716 169,186,466 65,428,549

Add : Share
Forfeiture 2.40 2.40 2.40 2.40 2.40 2.40 -

Equity Share
Capital Suspense
Account - - - - 1,864.59 *** -

Preference Share
Capital - - - - 2,530.65

22,554.18 21,279.86 20,353.56 20,315.94 18,418.27 16,921.05 9,073.50

*Includes 79,279,236 equity shares of Rs.10/- each allotted for consideration other than cash pursuant to the schemes of amalgamation.
**Includes 60,633,350 equity shares of Rs.10/- each allotted to the equity shareholders of the amalgamating company, Shriram Investments Limited,
for consideration other than cash pursuant to the scheme of amalgamation.

***Represents 1,86,45,886 equity shares of Rs.10/- each to be allotted to the equity shareholders of the amalgamating company , Shriram Overseas
Finance Ltd., pursuant to the scheme of amalgamation sanctioned by the Hon'ble High Court of Madras

F-21
 Annexure IV
Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Assets and Liabilities

(Rs. in lacs)
As at March As at December
Schedule 10 - Reserves and As at March 31,
31, 31,
Surplus
2010 2009 2009 2008 2007 2006 2005

Reserves and Surplus

Capital Reserve
Balance as per last account 17.03 17.03 17.03 17.03 17.03 0.73 0.73
Add: On Amalgamation of
Shriram Overseas Finance
Limited 16.30
17.03 17.03 17.03 17.03 17.03 17.03 0.73

Capital Redemption Reserve 5,388.35 5,388.35 5,388.35 5,388.35 5,388.35 5,388.35 -

Securities Premium Account
Balance as per last account 91,689.29 91,689.29 91,326.94 49,415.08 38,551.73 5,250.62 124.86
Add: On Amalgamation of
Shriram Investments Limited - - - - 4,952.64 -
Add: On Amalgamation of
Shriram Overseas Finance - - - - 3,380.22 -
Limited
Add: Amount received during
the year/period 82,730.28 24,448.71 362.35 41,911.86 10,863.35 24,968.25 5,125.76
174,419.57 116,138.00 91,689.29 91,326.94 49,415.08 38,551.73 5,250.62
Statutory Reserve
Balance as per last account 33,899.79 33,899.79 21,599.79 13,799.79 9,989.79 3,262.00 2,262.00
Add: On Amalgamation of
Shriram Investments Limited - - - - - 3,561.49 -
Add: On Amalgamation of
Shriram Overseas Finance
Limited - - - - - 332.29 -
Add: Transfer from Profit &
Loss Account 17,500.00 12,300.00 7,800.00 3,810.00 2,834.01 1,000.00
51,399.79 33,899.79 33,899.79 21,599.79 13,799.79 9,989.79 3,262.00
Debenture Redemption
Reserve
Balance as per last account - - - - 100.00 50.00 50.00
Add: On Amalgamation of
Shriram Investments Limited - - - - - 50.00 -
Add: Transfer from Profit &
Loss Account 10,442.08 6,802.27 - - - - -
Less: Transfer to General
Reserve - - - - 100.00 - -
10,442.08 6,802.27 - - - 100.00 50.00
General Reserve
Balance as per last account 17,453.63 17,453.63 11,253.63 7,353.63 5,253.63 1,208.61 708.61
Add: On Amalgamation of
Shriram Investments Limited - - - - - 1,301.96 -
Add: On Amalgamation of
Shriram Overseas Finance - - - - - 1,243.06 -
Limited
Add: Transfer from Debenture
Redemption Reserve - - - - 100.00 - -
Add: Transfer from Profit &
Loss Account 8,800.00 - 6,200.00 3,900.00 2,000.00 1,500.00 500.00
26,253.63 17,453.63 17,453.63 11,253.63 7,353.63 5,253.63 1,208.61
Balance in Profit & Loss
Account 93,001.65 107,017.36 58,309.25 27,486.21 12,248.92 5,322.65 3,396.32

360,922.10 286,716.43 206,757.34 157,071.95 88,222.80 64,623.18 13,168.28

F-22
 Annexure IV

Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Assets and Liabilities

(Rs. in lacs)

As at December
Schedule 11 - Miscellaneous As at March 31, As at March 31,
31,
Expenditure (to the extent not
2010 2009 2009 2008 2007 2006 2005
written off or adjusted)

Issue expenses for equity shares 1,491.47 - - - 11.34 20.25 5.56

Public issue expenses for non
convertible debentures 2,217.22 3,543.21 - - 2.39 17.70 38.87
Deferred revenue expenses - - - - - 3.22 -

3,708.69 3,543.21 - - 13.73 41.17 44.43

F-23
 Annexure V
Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Profit and Loss Account

(Rs. in lacs)
For the For the year ended March 31,
period
For the year
Schedule 12 - Income from April 01,
ended March
Operations 2009 to 2009 2008 2007 2006 2005
31, 2010
December
31, 2009

Finance & service charges 361,545.82 278,129.52 324,404.44 224,782.81 136,784.70 80,649.87 28,715.21
Fees from reconditioning/exchange
of trucks - - - - 141.75 463.03 -
Interest on other loans 360.10 261.72 666.99 407.78 709.74 790.18 296.17
Interest on margin money on
securitisation 10,367.78 7,967.54 6,951.61 3,553.78 571.84 326.49 73.30
Income on securitisation 68,009.04 34,498.68 33,895.73 16,584.31 2,091.51 6,305.01 4,747.08

440,282.74 320,857.46 365,918.77 245,328.68 140,299.54 88,534.58 33,831.76

(Rs. in lacs)
For the For the year ended March 31,
period
For the year
April 01,
Schedule 13 - Other Income ended March
2009 to 2009 2008 2007 2006 2005
31, 2010
December
31, 2009

Buyer-seller facilitation fees 3,053.46 2,235.91 - - - - -

Interest on deposits with banks 1,696.77 1,132.64 1,749.56 2,436.50 313.68 286.84 93.73
Income from operating lease 453.91 445.78 31.22 31.74 34.56 34.15 12.83
Sale of electricity - - 3,265.26 1,290.12 1,130.66 1,117.99 491.73
Profit on sale of assets 62.40 88.78 - - - - -
Income from Long Term
Investments (non trade)
- Profit on sale of investments
(net) 66.55 66.55 - 1.74 11.65 19.06 6.84
- Dividend 0.25 0.25 0.25 - 0.42 2.13 0.06
- Interest on government
securities 100.51 40.57 24.20 41.27 60.01 60.94 27.34
- Interest on Pass Through
Certificates 119.18 114.01 146.02 75.21 25.27 - -
Income from Current
Investments (non trade)
- Profit on sale of investments 1,746.10 755.77 514.17 715.96 - - -
- Dividend 874.46 874.46 486.66 519.33 20.42 - -
- Interest on Certificate of
Deposits 1,068.27 287.69 693.09 414.88 - - -
-Discount on CBLO 193.55 - - - - -
- Interest on Commercial
Paper - - 10.49 - - - -
- Interest on Debentures - - 144.33 - - - -
Commission Received - - - - 191.20 542.02 86.80
Miscellaneous Income 245.67 139.47 128.95 47.25 51.19 32.80 17.75
9,681.08 6,181.88 7,194.20 5,574.00 1,839.06 2,095.93 737.08

F-24
 Annexure V
Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Profit and Loss Account

(Rs. in lacs)
For the For the year ended March 31,
period
For the year
Schedule 14 - Interest & Other April 01,
ended March
Charges 2009 to 2009 2008 2007 2006 2005
31, 2010
December
31, 2009

Interest & Other Charges on :

Debentures 65,969.57 49,635.34 50,682.12 34,120.26 26,585.50 26,443.48 12,217.80
Subordinated debts 23,214.26 16,741.25 15,851.15 10,161.50 5,439.59 3,231.78 746.33
Fixed deposits 475.98 228.19 31.05 101.85 150.73 277.49 154.18
Loans from banks 105,813.69 78,276.88 93,513.23 56,804.74 26,613.91 6,645.59 1,089.76
Loans from institutions and others 13,455.67 11,177.26 17,706.49 17,848.72 6,623.57 3,145.87 860.04
Commercial paper 2,199.54 2,149.41 4,281.04 2,225.29 1,653.33 - -
Bank charges 2,350.85 1,851.92 1,816.71 735.44 581.99 341.28 172.11
Professional charges - resource
mobilisation 4,895.23 3,063.13 6,897.31 3,575.02 1,440.91 407.31 281.70
Processing charges on
loans/securitization 3,605.42 2,650.84 4,787.16 2,991.00 4,740.42 1,420.44 1,039.42
Discount on sale of second loss
credit / liquidity facilities 584.00 - - - - -
Fees / Loss on sale of second loss
credit / liquidity facilities 2,114.72 1,603.62 2,200.95 1,097.82 3.16 - -

224,678.93 167,377.84 197,767.21 129,661.64 73,833.11 41,913.24 16,561.34

F-25
 Annexure V

Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Profit and Loss Account

(Rs. in lacs)

For the period For the year ended March 31,

For the year
Schedule 15 - Raw Material April 01, 2009
ended March
Consumed to December 31, 2009 2008 2007 2006 2005
31, 2010
2009

Opening Stock 126.81 126.81 66.53 - - - -

Add : Purchases - - 747.45 324.59 - - -
Less : Transferred to Lessee (126.81) (126.81)
Closing Stock - - 126.81 66.53 - - -

- - 687.17 258.06 - - -

(Rs. in lacs)

For the For the year ended March 31,

For the year period April
Schedule 16 - Personnel
ended March 01, 2009 to
Expenses 2009 2008 2007 2006 2005
31, 2010 December
31, 2009

Salaries & other allowances 21,020.66 15,317.90 18,724.57 11,558.30 6,683.63 4,220.34 1,226.20
Gratuity expenses 197.65 141.06 154.91 212.96 42.61 33.98 21.25
Contribution to provident and
other funds 976.89 710.59 897.40 523.10 254.66 230.95 92.01
Staff welfare expenses 312.95 226.74 276.72 253.40 282.49 291.35 82.42

22,508.15 16,396.29 20,053.60 12,547.76 7,263.39 4,776.62 1,421.88

F-26
 Annexure V
Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Profit and Loss Account

(Rs. in lacs)
For the For the period For the year ended March 31,
Schedule 17 - Operating and year ended April 01, 2009
other Expenses March 31, to December 2009 2008 2007 2006 2005
2010 31, 2009

Rent 3,557.92 2,598.20 2,636.98 1,475.33 987.91 679.77 244.41

Electricity expenses 467.29 369.11 460.22 303.53 244.13 210.32 84.48
Repairs & Maintenance
- Plant & machinery 5.79 13.06 168.89 63.69 148.24 111.97 36.67
- Building 0.70 0.46 0.61 1.58 - - -
- Others 2,273.27 1,736.50 2,337.15 1,264.83 896.47 700.61 257.33
Rates & taxes 230.01 138.11 509.04 170.07 175.05 51.53 68.69
Printing & stationery 1,483.07 973.15 1,618.08 1,191.84 1,038.17 604.73 237.68
Travelling & conveyance 3,329.11 2,416.95 3,162.68 1,939.13 1,390.59 1,128.66 441.06
Advertisement 443.50 93.06 84.36 93.85 747.04 96.89 23.00
Brokerage and discount 5,442.03 4,593.85 8,668.83 6,528.13 4,322.12 6,207.59 3,159.93
Data sourcing & collection
commission paid to others 23.96 20.89 87.35 57.95 44.61 115.96 501.44
Royalty 1,240.78 901.81 1,036.45 623.54 356.35 212.35 81.30
Directors' sitting fees 14.65 10.80 15.70 17.80 9.78 2.31 0.23
Insurance 148.37 106.78 100.70 107.29 54.45 47.44 11.60
Communication expenses 2,571.12 1,877.83 2,617.80 1,583.40 1,140.46 916.36 365.11
Auditor's remuneration
- Audit fees 72.80 39.71 71.36 53.20 45.14 14.47 5.46
- Tax audit fees 2.76 - 2.21 2.55 2.53 3.34 1.44
- Other services 3.31 1.10 8.49 12.75 5.06 3.44 4.17
- Out of pocket 4.82 3.67 7.82 4.36 2.86 2.17 1.52
Legal & professional charges 2,827.61 1,469.77 1,194.13 848.69 581.47 839.07 138.61
Donations 161.81 51.49 106.55 75.26 75.14 85.37 56.39
Loss on sale of assets (net) - - 87.77 17.39 231.02 33.00 7.63
Loss on sale of Long Term
Investments (non trade) - - 1.56 - - - -
Miscellaneous expenses 2,953.54 2,221.17 2,940.77 3,027.06 1,289.51 1,095.02 350.76

27,258.22 19,637.47 27,925.50 19,463.22 13,788.10 13,162.37 6,078.91

F-27
 Annexure V
Shriram Transport Finance Company Limited

Schedules to the Reformatted Statement of Profit and Loss Account

(Rs. in lacs)

For the period

For the year For the year ended March 31,
Schedule 18 - Share & Debenture April 01, 2009
ended March
issue expenses written off to December
31, 2010 2009 2008 2007 2006 2005
31, 2009

Issue expenses for equity shares 25.28 - - 11.35 8.89 10.74 1.68
Public issue expenses for non
convertible debentures 473.42 394.28 - 1.37 15.31 21.17 21.17
Deferred revenue expenses - - - 1.02 3.24 7.44 -

498.70 394.28 - 13.74 27.44 39.35 22.85

(Rs. in lacs)

For the For the year ended March 31,

For the
period April
Schedule 19 - Provisions & Write year ended
offs
01, 2009 to
March 31, 2009 2008 2007 2006 2005
December
2010
31, 2009

Provision for non performing assets 14,953.03 14,374.56 13,354.65 3,789.85 3,142.42 1,357.58 372.42
Provision for credit loss on
securitisation 7,971.84 3,317.30 4,464.01 2,009.30 1,640.19 - -
Provision for diminution in value of
investments 20.34 21.67 82.43 60.67 (167.60) 11.79 19.85
Bad debts written off 18,668.99 13,526.46 13,440.25 19,583.17 13,270.07 6,964.47 1,844.70
Bad debt recovery (549.34) (397.02) (766.42) (774.00) (566.07) (190.77) (11.66)

41,064.86 30,842.97 30,574.92 24,668.99 17,319.01 8,143.07 2,225.31

F-28
 Annexure VI

Shriram Transport Finance Company Limited

Statement of Contingent Liabilities

(Rs in Lacs)

As at As at
March December As at March 31,
Particulars 31, 31,
2010 2009 2009 2008 2007 2006 2005

Disputed Income Tax/Interest Tax demand

contested in appeals not provided for 157.26 164.76 164.76 3,381.70 5,754.90 5,318.72 2,693.26

Guarantees issued by the Company and

outstanding - 700.00 901.97 1,991.58 4,101.12 1,752.68 771.37

Demand in respect of Service tax 315.00 312.00 299.00 284.00 230.24 - -

Income Tax penalty u/s 271(1)(c ) - 349.86 - - - - -

Disputed sales tax demand 412.33 - - - - - -

In respect of Portfolio Management - - - - 356.67 1,123.63 1,846.28

In respect of securitised assets - - - - - 29,742.84 11,994.20

F-29
 Annexure VII

Shriram Transport Finance Company Limited

Statement of Dividend

Statement of Dividend in respect of Preference Shares

(Rs in Lacs)
No. of Shares
For Nine
Year
months
ended As
ended
at 31st
December
March
Rates 31, Year ended As at 31st March
2010 2009 2009 2008 2007 2006 2005

6.00% - - - - - 481,930 3,960

8.00% - - - - - 25,270 260

9.00% - - - - - 4,548,880 2,417,850

10.00% - - - - - 23,590

12.00% - - - - - 15,680 15,530

12.50% - - - - - 41,340 25,940

14.00% - - - - - 81,850 30,600

15.00% - - - - - 169,810 36,510

Total Shares - - - - - 5,388,350 2,530,650

Amount of Dividend - - - 423.67 228.21

Dividend Distribution Tax - - - - 59.43 29.82

Note: The Preference shares outstanding as on 31st March 2005 were redeemed in financial year 2005-06 and were paid pro-rata
dividend at coupon rates prevailing in financial year 2004-05.

F-30
 Annexure VII

Shriram Transport Finance Company Limited

Statement of Dividend in respect of Equity Shares

(Rs. In Lacs)
For Nine
Year ended months
As at 31st ended
Particulars March December
31, Year ended As at 31st March
2010 2009 2009 2008 2007 2006 2005
Interim
Rate of Dividend 20% 20% 10% 10% 10% 10% 10%
Number of Equity Shares on which
Interim Dividend paid 212,737,916 212,737,916 203,502,416 203,135,416 174,901,466 126,061,899 51,949,549

Amount of Interim Dividend 4,254.76 4,254.76 2,035.03 2,031.35 1,749.01 1,260.62 519.50

Dividend Distribution Tax 723.10 723.10 345.85 345.23 245.30 176.80 67.89

Rate of Dividend - - - - - 20% -

Number of Equity Shares on which
Interim Dividend paid - - - - - 150,540,580 -

Amount of Interim Dividend - - - - - 3,010.81 -

Dividend Distribution Tax - - - - - 422.27 -

Final Dividend for the previous

year

Rate of Dividend 40% 40% 40% 20% - - -

Number of Equity Shares on which
Final Dividend paid 8,129,550 8,129,550 263,100 6,942,500 - - -

Amount of Final Dividend 325.18 325.18 10.52 138.85 - - -

Dividend Distribution Tax 55.26 55.26 1.79 23.60 - - -

Proposed Final Dividend for the

current year

Rate of Dividend 40% - 40% 40% 20% 30%** 15%

Number of Equity Shares on which
dividend paid 225,517,818 - 203,511,616 203,135,416 184,158,716 18,645,886 65,428,549

Amount of Final Dividend 9,020.71 - 8,140.46 8,125.42 3,683.17 559.38 981.43

Dividend Distribution Tax 1,498.25 - 1,383.52 1,380.92 625.95 78.45 128.26

** Represents Dividend of 30% for Shareholders of M/s Shriram Overseas Finance Limited pursuant to Amalgamation

F-31
 Annexure-VIII
Shriram Transport Finance Company Limited

Page 1 of 3
Statement of Accounting Ratios
[Calculation of Earnings Per shares (EPS)]

Earnings per share calculations are done in accordance with Accounting Standard - 20 "Earnings Per Share",
notified under Accounting Standards (‘AS’) under Companies Accounting Standard Rules, 2006, as amended

As at
As at
December As at 31st March
March 31,
31,
Particulars
2010 2009 2009 2008 2007 2006 2005

Net profit after tax (Rs. in Lacs) 87,311.74 60,868.68 61,240.21 38,982.65 19,039.71 14,164.10 4,932.38

Less: Preference dividend including

tax on dividend (Rs. in Lacs) - - - - - 483.10 258.03

Net profit attributable to equity

shareholders (Rs. in Lacs) a 87,311.74 60,868.68 61,240.21 38,982.65 19,039.71 13,681.00 4,674.35

Weighted average number of equity

shares outstanding
during the year/period. (for Basic
EPS )(Lacs) b 2,125.01 2,097.17 2,033.80 1,924.01 1,729.59 1,461.41 515.72

(i) Equity shares arising on

conversion of optionally c - - 80.00 23.83 69.00 82.58 3.58
convertible warrants (Lacs)

(ii) Equity shares for no

consideration arising on grant
of stock options under ESOP
(Lacs) d 8.84 18.80 24.49 29.92 13.48 3.39 -

Weighted average number of equity

shares outstanding
during the year/period. (for Diluted
EPS ) (b+c+d) (Lacs) e 2,133.85 2,115.97 2,138.29 1,977.76 1,812.07 1,547.38 519.30

Earnings per share (Basic) (Rs.)

(a/b) 41.09 *29.02 30.11 20.26 11.01 9.36 9.06

Earnings per share (Diluted) (Rs.)

(a/e)
40.92 *28.77 28.64 19.71 10.51 8.84 9.00

*not annualised

F-32
 Annexure-VIII
Shriram Transport Finance Company Limited

Page 2 of 3

Statement of Accounting Ratios

[Calculation of Return on Net Worth (RONW)]
(Rs. in Lacs)

As at March As at
As at 31st March
Particulars 31, December 31,
2010 2009 2009 2008 2007 2006 2005

SHAREHOLDERS FUNDS

Share Capital 22,554.18 21,279.86 20,353.56 20,315.94 18,418.27 16,921.05 9,073.50

Share application money pending
allotment 5.22 12.97 13.80 21.37 - - -
Stock Option Outstanding 757.02 1,497.93 2,138.90 1,826.64 1,227.38 353.49 -
Optionally Convertible warrants - - 2,400.00 2,400.00 772.80 1,992.03 103.81
Reserves and Surplus (Refer
Annexure IV - Schedule 10) 360,922.10 286,716.43 206,757.34 157,071.95 88,222.80 64,623.18 13,168.28

Less: Miscellaneous Expenditure 3,708.69 3,543.21 - - 13.73 41.17 44.43

( not written off)
Net worth as at the end of the
year/ period 380,529.83 305,963.98 231,663.60 181,635.90 108,627.52 83,848.58 22,301.16

Net profit after tax 87,311.74 60,868.68 61,240.21 38,982.65 19,039.71 14,164.10 4,932.38

Return on Net Worth 22.94% 26.53% 26.43% 21.46% 17.53% 16.89% 22.12%
(Annualised) (%)

F-33
 Annexure VIII
Shriram Transport Finance Company Limited

Page 3 of 3

Statement of Accounting Ratios

[Calculation of Net Asset Value (NAV) Per Equity Share]

(Rs. in Lacs)

As at
As at March
December
Particulars 31,
31,
As at 31st March
2010 2009 2009 2008 2007 2006 2005

SHAREHOLDERS
FUNDS
Share Capital 22,554.18 21,279.86 20,353.56 20,315.94 18,418.27 16,921.05 9,073.50
Share application money
pending allotment 5.22 12.97 13.80 21.37 - - -
Stock Option Outstanding 757.02 1,497.93 2,138.90 1,826.64 1,227.38 353.49 -
Optionally Convertible
warrants - - 2,400.00 2,400.00 772.80 1,992.03 103.81
Reserves and Surplus (Refer
Annexure IV - Schedule 10) 360,922.10 286,716.43 206,757.34 157,071.95 88,222.80 64,623.18 13,168.28

Less: Miscellaneous
Expenditure 3,708.69 3,543.21 - - 13.73 41.17 44.43
( not written off)
Net Asset Value 380,529.83 305,963.98 231,663.60 181,635.90 108,627.52 83,848.58 22,301.16

Number of Equity shares

outstanding at the end of
the year/period 225,517,818 212,774,566 203,511,616 203,135,416 184,158,716 169,186,466 * 65,428,549

Net Asset Value per

Equity Share(Rs.) 168.74 143.80 113.83 89.42 58.99 49.56 34.08

Note:
* Number of shares as at 31st March 2006 include 18,645,886 equity shares which were pending to be allotted to the equity shareholders of the
amalgamating company, Shriram Overseas Finance Limited, which have since been allotted.

F-34
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans
A Term Loan from banks Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31, 2010
Allahabad Bank 26-Sep-07 3,000.00 1,499.90 20 quarterly instalments
Andhra Bank 30-Nov-09 20,000.00 1,8750.00 16 quarterly
installments
Andhra Bank 16-Mar-09 10,000.00 7,500.00 16 quarterly
installments
AXIS Bank 18-Feb-08 10,000.00 10,000.00 Bullet-17/02/2011
AXIS Bank 20-Oct-08 20,000.00 20,000.00 Bullet-19/10/2010
AXIS Bank 24-Mar-09 50,000.00 16,666.67 6 quarterly installments
Bank Of Rajasthan 30-Jun-09 2,500.00 1,875.00 12 quarterly
installments
Bank Of Tokyo 24-Dec-09 11,000.00 11,000.00 Bullet-24/12/2010
Barclays Bank 3-Aug-09 3,000.00 3,000.00 Bullet-03/08/2010
Barclays Bank 30-Oct-09 4,500.00 4,500.00 Bullet-30/10/2010
Barclays Bank 29-Sep-09 3,400.00 3,400.00 Bullet -29/09/2010
Calyon Bank 16-Nov-07 5,000.00 5,000.00 Bullet-15/11/2010
Calyon Bank 24-Mar-08 2,000.00 2,000.00 Bullet-24/03/2011
Calyon Bank 28-Apr-08 3,000.00 3,000.00 Bullet-27/04/2011
Canara Bank 26-Jun-09 25,000.00 20,312.50 16 quarterly
installments
Canara Bank 25-Nov-09 50,000.00 46,875.00 16 equal quarterly
installments
Canara Bank 31-Mar-09 25,000.00 18,750.00 16 quarterly
installments
Canara Bank 17-Oct-08 20,000.00 13,750.00 16 quarterly
installments
Canara Bank 5-Nov-08 20,000.00 13,750.00 16 quarterly
installments
Central Bank Of India 30-Jun-09 20,000.00 16,250.00 16 quarterly
installments
China Trust Commercial Bank 18-Nov-09 1,500.00 1,500.00 Bullet 18/11/2011
CITI Bank 23-Jun-09 5,000.00 5,000.00 Bullet-23/06/2010
CITI Bank 7-May-09 10,000.00 10,000.00 Bullet -07/05/2010
CITI Bank 17-Aug-09 10,000.00 10,000.00 Bullet-17/8/2010

Corporation Bank 26-Mar-09 2,500.00 1,875.00 16 quarterly

installments
Development Bank Of Singapore 22-Jun-09 5,000.00 5,000.00 3 installments
Development Bank Of Singapore 23-Sep-09 4,830.00 4,830.00 Bullet- 23/09/2011
Development Bank Of Singapore 5-Mar-09 2,650.00 2,650.00 Bullet-05/09/2010
Development Bank Of Singapore 27-Sep-07 7,500.00 7,500.00 Bullet-27/09/2010
Dena Bank 23-Sep-08 20,000.00 10,000.00 36 monthly installments
Dena Bank 31-Jul-09 20,000.00 17,500.00 16 equal quarterly
installments
Deutsche Bank 22-Sep-09 7,500.00 7,500.00 Bullet 22/09/2011
Deutsche Bank 30-May-08 10,000.00 10,000.00 Bullet-30/05/2011

F-35
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans
A Term Loan from banks Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31, 2010
Deutsche Bank 30-May-08 10,000.00 10,000.00 Bullet-30/05/2010
HDFC Bank 25-Jul-08 7,500.00 5,357.14 14 equal quarterly
installments
HDFC Bank 3-Oct-09 10,000.00 10,000.00 14 quarterly installments
HSBC Bank 29-May-09 4,770.00 4,770.00 Bullet-31/05/2011
HSBC Bank 23-Oct-09 9,332.00 7,387.83 24 Equal Monthly
installments
HSBC Bank 4-Aug-09 10,000.00 10,000.00 Bullet-04/08/2010
HSBC Bank 25-Mar-09 9,250.00 9,250.00 Bullet-26/04/2010
HSBC Bank 18-Sep-09 4,850.00 4,850.00 Bullet-16/09/2011
ICICI Car Loan 10-Feb-06 9.77 1.87 60 equated monthly
installments
ICICI Car Loan 5-Jun-06 4.90 1.32 59 equated monthly
installments
IDBI Bank 28-Apr-08 25,000.00 10,416.67 12 equal quarterly
installments
IDBI Bank 29-Sep-09 20,000.00 19,523.81 42 monthly equal
installments
IDBI Bank 24-Mar-09 15,000.00 10,714.29 14 equal quarterly
installments
IDBI Bank 3-Mar-08 7,500.00 2,678.83 14 equal quarterly
installments
IDBI Bank 24-Oct-08 5,000.00 3,214.29 14 equal quarterly
installments
IDBI Bank 10-Dec-08 10,000.00 6,428.57 14 equal quarterly
installments
Indian Bank 30-Jun-09 10,000.00 7,273.00 33 monthly installments
Indian Bank 28-Sep-07 5,000.00 525.59 33 monthly installments
Indian Bank 5-Mar-09 10,000.00 6,363.64 33 monthly installments

Indian Bank 25-Mar-08 5,000.00 1,515.84 33 monthly installments

ING Vysya Bank 31-Dec-07 6,500.00 1,625.00 36 monthly installments

ING Vysya Bank 2-Dec-08 3,500.00 2,041.67 36 monthly installments

ING Vysya Bank 30-Oct-09 3,800.00 3,272.22 36 equal monthly

installments
Karur Vysya Bank 31-Jul-09 2,000.00 1,750.00 16 equal quarterly
installments
Laxmi Vilas Bank 12-Sep-09 4,500.00 4,500.00 Bullet -12/09/2010

Oriental Bank Of Commerce 24-Aug-09 20,000.00 16,111.11 36 equated monthly

installments
Oriental Bank Of Commerce 28-Feb-08 20,000.00 10,160.69 48 equated monthly
installment
Oriental Bank Of Commerce 22-Nov-07 10,000.00 2,397.51 36 equated monthly
installments
Punjab & Sind Bank 16-Apr-08 5,000.00 5,000.00 Bullet-15/04/2011
Punjab & Sind Bank 19-Nov-09 5,000.00 4,722.22 36 monthly installment

Punjab National Bank 15-Oct-08 20,000.00 10,285.69 35 monthly installment

F-36
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans
A Term Loan from banks Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31, 2010
Punjab National Bank 27-Jul-09 20,000.00 15,294.00 34 equal monthly
installment
Ratnakar Bank 20-Dec-07 2,500.00 1,093.60 48 Monthly installments
State Bank Of Patiala Bank 29-Sep-09 20,000.00 20,000.00 13 quarterly
installments
State Bank Of Travancore 29-Sep-09 10,000.00 8,610.00 36 equal monthly
installment
Society General Bank 14-Aug-09 2,000.00 1,416.67 24 Monthly installments
Society General Bank 24-Dec-09 1,200.00 1,050.00 24 equal Monthly
installments
Society General Bank 29-Oct-07 6,000.00 1,240.00 36 monthly installments
Society General Bank 14-Mar-08 1,180.00 331.87 36 monthly installments
South Indian Bank 17-Dec-09 5,000.00 4,687.50 16 equal quarterly
installments
South Indian Bank 18-Aug-08 5,000.00 3,125.00 16 quarterly
installments
South Indian Bank 20-Mar-09 2,500.00 1,875.00 16 quarterly
installments
Standard Chartedred Bank 4-Mar-09 8,700.00 4,002.00 24 Monthly installments
Standard Chartedred Bank 6-May-08 13,000.00 1,040.00 24 Monthly installments
State Bank Of Bikaner & Jaipur 8-Nov-07 5,000.00 1,256.00 12 quarterly
installments
State Bank Of Bikaner & Jaipur 9-Apr-09 5,000.00 3,121.25 16 quarterly
installments
State Bank Of Bikaner & Jaipur 31-Mar-09 2,500.00 2,500.00 16 quarterly
installments
State Bank Of Hyderabad 5-Nov-09 25,000.00 23,437.50 16 quarterly
installments
State Bank Of Hyderabad 21-Jan-08 15,000.00 7499.40 16 quarterly
installments
State Bank Of Mauritius Bank 19-Jan-09 2,250.00 1,500.00 12 Quarterly
installments
State Bank Of Mysore Bank 29-Sep-06 2,500.00 315.86 48 monthly installments
State Bank Of Mysore Bank 22-Jun-07 10,000.00 2,905.54 48 monthly installments
State Bank Of Mysore Bank 5-Mar-09 10,000.00 7,499.97 48 monthly installments
State Bank Of Mysore Bank 26-Nov-07 10,000.00 4,175.58 48 monthly installments
State Bank Of Mysore Bank 19-Sep-08 15,000.00 9,370.86 48 monthly installments
State Bank Of Patiala Bank 30-Jul-08 20,000.00 14,280.00 14 quarterly
installments
State Bank Of Travancore 28-Jun-07 5,000.00 416.69 12 quarterly
installments
State Bank Of Travancore 29-Jan-09 7,500.00 5,000.00 12 quarterly
installments
Syndicate Bank 29-Sep-09 15,000.00 13,125.00 48 monthly installments
Tamilnad Merchantile Bank Limited 22-Jun-09 5,000.00 4,062.50 48 Monthly installments
UCO Bank 25-Sep-09 15,000.00 13,125.00 16 equal quarterly
installments
Union Bank 31-Dec-09 30,000.00 30,000.00 16 equal quarterly
installments

F-37
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans
A Term Loan from banks Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31, 2010
United Bank 25-Sep-09 10,000.00 8,750.00 16 quarterly
installments
United Bank 3-Jun-08 5,000.00 2,812.50 16 quarterly
installments
United Bank 31-Dec-08 10,000.00 7,500.00 16 quarterly
installments
United Bank 13-Mar-09 15,000.00 11,250.00 16 quarterly
installments

Vijaya Bank 28-Sep-06 5,000.00 625.00 16 quarterly

installments
Vijaya Bank 28-Feb-08 5,000.00 2,500.00 16 quarterly
installments
Barclays Bank 19-Jan-10 4,100.00 4,100.00 Bullet 19/01/2011
Indian Bank 29-Jan-10 20,000.00 19,168.00 48 Monthly installment

State Bank Of India (Wcdl) 28-Jan-10 20,000.00 20,000.00 Bullet 27/07/2010

Standard Charterd Bank 28-Jan-10 30,000.00 30,000.00 5 installment
Calyon Bank 29-Jan-10 10,000.00 10,000.00 Bullet 29/01/2012
State Bank of Indore(Wcdl) 9-Feb-10 7,500.00 7,500.00 Bullet 10/05/2010
State Bank of Patiala(Wcdl) 26-Feb-10 4,000.00 4,000.00 Bullet-27/05/2010
Shinhan Bank 9-Feb-10 2,800.00 2,800.00 Bullet-01/01/2011
Mizuho Bank 5-Mar-10 5,000.00 5,000.00 Bullet-05/03/2011
Dhanlakshmi Bank 12-Mar-10 5,000.00 5,000.00 15 quarterly installment
J P Morgan Chase Bank 22-Mar-10 12,000.00 12,000.00 Bullet - 06/04/2011
HSBC Bank 23-Mar-10 10,000.00 10,000.00 Bullet -23/04/2011
Corporation Bank 25-Mar-10 10,000.00 10,000.00 20 quaterly installment
Punjab National Bank 26-Mar-10 25,000.00 25000.00 34 Monthly installment
Society General Bank 23-Mar-10 1,200.00 1,200.00 24 Monthly installments
Total 1,205,826.67 929,935.14

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 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans
B Term Loan from others Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31, 2010
L&T Finance Limited 2-Mar-05 2,500.00 466.08 72 monthly installments
L&T Finance Limited 29-Jun-05 2,500.00 626.97 72 monthly installments
L&T Finance Limited 2-Jan-06 2,500.00 860.37 72 monthly installments
Life Insurance Corporation 14-Jun-06 7,500.00 3,000.00 5 annual installments
Small Industries Development Bank of 2-Jan-06 2,000.00 335.00 54 monthly installments
India
Small Industries Development Bank of 31-Dec-07 5,000.00 1,400.00 33 monthly installments
India

Small Industries Development Bank of 29-Sep-08 10,000.00 5,500.00 33 monthly installments

India

Total 32,000.00 12,188.42

C Cash Credit from Banks

Particulars Date of Disbursed Balance as on

disbursement Amount March 31, 2010

Abu Dhabi Commercial Bank 3-Feb-09 1,500.00 4.88

Andhra Bank 30-Dec-09 15,000.00 1,012.85
Bahrain & Kuwait 22-Jul-08 1,000.00 899.99
Bank Of Baroda 19-Nov-07 4,000.00 3,006.12
Bank Of Ceylon 21-Nov-08 600.00 0.16
Bank Of India 4-Jun-09 27,500.00 9,998.11
Bank Of India WCDL 28-Aug-09 20,000.00 20,000.00
Bank Of Maharashtra 22-Dec-08 10,000.00 3,699.36
Bank Of Rajasthan 22-Jun-09 2,500.00 6.58
Central Bank Of India 21-Aug-09 30,000.00 15,050.78
City Union Bank 13-Oct-08 5,000.00 1,638.92
Corporation Bank 16-Jan-08 5,000.00 972.01
DCB WCDL 22-Jan-10 2,000.00 2,000.00
DCB WCDL 30-Jan-10 2,000.00 2,000.00
Dena Bank 30-Jan-09 17,500.00 99.06
Federal Bank 19-Sep-07 5,000.00 5.86
ICICI Bank 5-Mar-09 20,000.00 6,988.85
IDBI Bank 3-Oct-08 5,000.00 5.01
IDBI Bank 29-Jan-10 20,000.00 56.75
Indian Bank 29-Jan-10 5,000.00 6.49
Indian Overseas Bank 18-Feb-09 10,000.00 5,012.22
Karnataka Bank 5-Dec-07 10,000.00 4,730.09

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 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
C Cash Credit from Banks Rs in Lacs
Particulars Date of Disbursed Balance as on
disbursement Amount March 31, 2010
Karur Vysya Bank Wcdl 30-Jun-09 1,500.00 1,512.11
Punjab National Bank 24-Dec-07 6,000.00 0.06
Ratnakar Bank 11-Aug-08 1,000.00 5.43
State Bank Of Bikaner & Jaipur 30-Dec-09 5,000.00 4,207.18
State Bank Of Mysore 26-Sep-09 10,000.00 3,012.86
State Bank Of Travancore 29-Sep-08 7,500.00 3,557.73
Syndicate Bank 5-Mar-10 10000.00 2,520.59
The Lakshmi Vilas Bank 17-Mar-09 2,500.00 3.45
UCO Bank 4-Aug-08 15,000.00 23.14
TOTAL 277,100.00 92,036.64

D Privately placed Redeemable Non Convertible Debenture of Rs 1,000,000 each

Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
Allotment Amount March 31, 2010

UTI - Treasury Advantage Fund 5-Jul-07 5,000.00 5,000.00 Bullet -05/07/2010

UTI - Treasury Advantage Fund 9-Jul-07 2,500.00 2,500.00 Bullet -09/07/2010
HDFC Trustee Company Ltd - A/C HDFC 9-Jul-07 1,590.00 1,590.00 Bullet -09/07/2010
Fixed Maturity Plan 36M June 2007
UTI - Fixed Maturity Plan - Yearly Series 9-Jul-07 1,500.00 1,500.00 Bullet -09/07/2010
Sep 09
Reliance General Insurance Company Ltd 9-Jul-07 500.00 500.00 Bullet -09/07/2010
HDFC Trustee Company Limited A/C 9-Jul-07 500.00 500.00 Bullet -09/07/2010
HDFC Fixed Maturity Plan 17Mnovember
2008 (1)
HDFC Trustee Company Limited A/C 9-Jul-07 210.00 210.00 Bullet -09/07/2010
HDFC Cash Management Fund Treasury
Advantage Plan
HDFC Trustee Company Limited A/C 9-Jul-07 200.00 200.00 Bullet -09/07/2010
HDFC Fixed Maturity Plan 22M September
2008
HDFC Standard Life Insurance Company 11-Jul-07 1,000.00 1,000.00 Bullet -09/07/2010
Limited
The Hongkong And Shanghai Banking 25-Jul-07 2,500.00 2,500.00 Bullet -25/07/2010
Corp.Ltd.
ICICI Prudential Flexible Income Plan 25-Jul-07 10,000.00 10,000.00 Bullet -25/07/2010
UTI-Unit Linked Insurance Plan 10-Sep-07 1,000.00 1,000.00 Bullet -10/09/2010
UTI - Ftif Series Vii Plan II 10-Sep-07 1,350.00 1,350.00 Bullet -10/09/2010
UTI - CCP Advantage Fund 10-Sep-07 150.00 150.00 Bullet -10/09/2010
KOTAK Mahindra Trustee Company. Ltd. 15-Oct-07 2,000.00 2,000.00 Bullet -15/10/2010
A/C KOTAK Fixed Maturity Plan 370 Days
Series 1
ICICI Prudential Short Term Plan 19-Oct-07 1,500.00 1,500.00 Bullet -18/10/2010
UTI - Retirement Benefit Pension Fund 19-Oct-07 1,400.00 1,400.00 Bullet -18/10/2010

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 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Rs in Lacs
D Privately placed Redeemable Non Convertible Debenture of Rs 1,000,000 each
Particulars Date of Disbursed Balance as on Repayment Terms
Allotment Amount March 31, 2010
ICICI Prudential Ultra Short Term Fund 19-Oct-07 1,000.00 1,000.00 Bullet -18/10/2010
UTI-Liquid Cash Plan 19-Oct-07 2,500.00 2,500.00 Bullet -19/10/2010
UTI - Treasury Advantage Fund 19-Oct-07 2,360.00 2,360.00 Bullet -19/10/2010
UTI-Money Market Fund 19-Oct-07 140.00 140.00 Bullet -19/10/2010
Life Insurance Corporation Of India 2-May-08 15,000.00 15,000.00 Bullet -02/05/2011
UTI-Unit Linked Insurance Plan 20-Jun-08 3,500.00 3,500.00 Bullet -20/06/2011
UTI-Unit Scheme For Charitable And 20-Jun-08 2,500.00 2,500.00 Bullet -20/06/2011
Religious trusts And Registered Societies
UTI - Childrens Career Balanced Plan 20-Jun-08 2,500.00 2,500.00 Bullet -20/06/2011
UTI - Retirement Benefit Pension Fund 20-Jun-08 1,500.00 1,500.00 Bullet -20/06/2011
Reliance Capital Trustee Company Ltd 4-Sep-08 5,000.00 5,000.00 Bullet -04/09/2010
A/C-Reliance money Manager Fund
HDFC Trustee Company Limited A/C 4-Sep-08 4,300.00 4,300.00 Bullet -04/09/2010
HDFC Cash Management Fund Treasury
Advantage Plan
HDFC Trustee Company Limited A/C 4-Sep-08 600.00 600.00 Bullet -04/09/2010
HDFC Fixed Maturity Plan 22M September
2008
HDFC Trustee Company Ltd-HDFC 4-Sep-08 100.00 100.00 Bullet -04/09/2010
Floating Rate Income Fund A/C Short Term
Plan
Deutsche Trustee Services (India) Pvt 8-Sep-08 2,800.00 2,800.00 Bullet -08/09/2010
Limited A/C Dws Fixed Term Fund
Religare Trustee Company Private Limited 8-Sep-08 110.00 110.00 Bullet -08/09/2010
- A/C Religare Long Term Fixed Maturity
Plan - Series I - Plan A
Religare Trustee Company Private Limited 8-Sep-08 80.00 80.00 Bullet -08/09/2010
- A/C Religare Ultra Short Term Fund
Religare Trustee Company Private Limited 8-Sep-08 10.00 10.00 Bullet -08/09/2010
- A/C Religare Short Term Plan
AXIS Bank Limited 16-Sep-08 2,500.00 2,500.00 Bullet -16/09/2011
KOTAK Mahindra Trustee Company Ltd. 15-Sep-08 1,070.00 1,070.00 Bullet -15/09/2010
A/C KOTAK flexi Debt Scheme
KOTAK Mahindra Trustee Company. Ltd. 15-Sep-08 430.00 430.00 Bullet -15/09/2010
A/C KOTAK Fixed Maturity Plan 19M
Series 01
KOTAK Mahindra Trustee Company Ltd. 15-Sep-08 2,500.00 2,500.00 Bullet -15/09/2010
A/C KOTAK flexi Debt Scheme
AXIS Bank Limited 15-Sep-08 1,500.00 1,500.00 Bullet -15/09/2011
UTI Ftif Sr - V Plan Ii ( 20 Mts ) 15-Sep-08 1,500.00 1,500.00 Bullet -30/04/2010
ICICI Prudential Fixed Maturity Plan 17-Sep-08 8,000.00 8,000.00 Bullet -01/09/2011
Series45 Three Years Plan
HDFC Trustee Company Limited A/C 24-Sep-08 2,500.00 2,500.00 Bullet -24/09/2010
HDFC Fixed Maturity Plan 22M September
2008
HDFC Trustee Company Limited A/C High 26-Sep-08 700.00 700.00 Bullet -26/09/2010
Interest Fund Short Term Plan

F-41
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Rs in Lacs
D Privately placed Redeemable Non Convertible Debenture of Rs 1,000,000 each
Particulars Date of Disbursed Balance as on Repayment Terms
Allotment Amount March 31, 2010
HDFC Trustee Company Limited A/C 26-Sep-08 600.00 600.00 Bullet -26/09/2010
HDFC Fixed Maturity Plan 17Mnovember
2008 (1)
HDFC Trustee Company Ltd HDFC Mf 26-Sep-08 550.00 550.00 Bullet -26/09/2010
Monthly Income Plan Short Term Plan
HDFC Trustee Company Limited A/C 26-Sep-08 350.00 350.00 Bullet -26/09/2010
HDFC Fixed Maturity Plan 22M September
2008
HDFC Trustee Company Ltd A/C - HDFC 26-Sep-08 190.00 190.00 Bullet -26/09/2010
Children'S Gift Fund - Investment Plan
HDFC Trustee Company Limited A/C 26-Sep-08 110.00 110.00 Bullet -26/09/2010
HDFC Cash Management Fund Treasury
Advantage Plan
UTI - Ftif Sr. V Plan Iii (24 Mts) 26-Sep-08 1,300.00 1,300.00 Bullet -10/09/2010
UTI-Unit Linked Insurance Plan 26-Sep-08 200.00 200.00 Bullet -10/09/2010
Sundaram Bnp Paribas Mutual Fund A/C 8-Oct-08 700.00 700.00 Bullet -06/04/2010
Sundaram bnp Paribas Ftp - 18 Months
Series L
Sundaram Bnp Paribas Mutual Fund A/C 8-Oct-08 300.00 300.00 Bullet -06/04/2010
Sundaram bnp Paribas Ultra Short Term
Fund
ICICI Prudential Fixed Maturity Plan - 8-Oct-08 190.00 190.00 Bullet -06/04/2010
Series45 - Twenty Months Plan
ICICI Prudential Liquid Plan 8-Oct-08 10.00 10.00 Bullet -06/04/2010
ICICI Prudential Real Estate Securities 24-Oct-08 4,500.00 4,500.00 Bullet -10/12/2010
Fund
ICICI Prudential Flexible Income Plan 24-Oct-08 500.00 500.00 Bullet -10/12/2010
Life Insurance Corporation Of India 3-Nov-08 30,000.00 30,000.00 Bullet -03/11/2013
General Insurance Corporation Of India 26-Nov-08 1,000.00 1,000.00 Bullet -26/11/2013
United Bank Of India 28-Mar-09 5,000.00 5,000.00 Bullet -28/03/2012
Templeton India Ultra-Short Bond Fund 13-Apr-09 10,000.00 10,000.00 Bullet -13/04/2011
Principal Trustee Company Private Ltd A/C 20-Apr-09 2,000.00 2,000.00 Bullet -20/04/2011
Principal Mutual Fund Principal Income
Fund Short Term Plan
Principal Trustee Company Private Ltd A/C 20-Apr-09 500.00 500.00 Bullet -20/04/2011
Principal Mutual Fund Principal Income
Fund
KOTAK Mahindra Trustee Company Ltd. 17-Jun-09 1,800.00 1,800.00 Bullet -17/06/2011
A/C KOTAK flexi Debt Scheme
KOTAK Mahindra Trustee Co. Ltd. A/C 17-Jun-09 700.00 700.00 Bullet -17/06/2011
KOTAK Fixed Maturity Plan18M
Standard Chartered Bank (Mauritius) 30-Jun-09 25,000.00 25,000.00 Bullet -30/06/2011
Limited -Debt
Tata Trustee Company Ltd A/C Tata 14-Sep-09 1,500.00 1500.00 Bullet -05/04/2011
Mutual Funda/C Tata Fixed Maturity Plan -
Series 25 Scheme A
Morgan Stanley India Capital Private 12-Oct-09 6,500.00 6,,500.00 Bullet -12/04/2011
Limited
KOTAK Mahindra Trustee Company. Ltd. 12-Oct-09 1,400.00 1,400.00 Bullet -12/04/2011
A/C KOTAK Fixed Maturity Plan18M
Series 2

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 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Rs in Lacs
D Privately placed Redeemable Non Convertible Debenture of Rs 1,000,000 each
Particulars Date of Disbursed Balance as on Repayment Terms
Allotment Amount March 31, 2010
KOTAK Mahindra Trustee Company Ltd 12-Oct-09 1,100.00 1,100.00 Bullet -12/04/2011
A/C KOTAK Fixed Maturity Plan 19 M
Series 2
Take Solutions Ltd 24-Mar-10 2,400.00 2,400.00 Bullet -24/03/2011
Take Solutions Ltd 25-Mar-10 200.00 200.00 Bullet -25/03/2011
Cmnk Consultancy & Services Pvt Ltd-B26 25-Mar-10 2,400.00 2,400.00 Bullet -2/03/2011
198,600.00 198,600.00

E Privately placed Redeemable Non Convertible Debenture of Rs 1,000 each

Rs in Lacs
Particulars As at March 31, 2010 Repayment Terms

Retail Debentures 188,703.14 Redeemable at par over a period 12 to 160 months

F Secured Redeemable Non Convertible Debentures -Debt Issue 2009 Rs in Lacs

Particulars
As at March 31, 2010 Repayment Terms

Option -I 3,489.95 26.08.2012

Option -I 3,489.95 26.08.2013

Option -I 1,744.97 26.08.2014

Option -II 2,949.84 26.08.2012

Option -II 2,949.84 26.08.2013

Option -II 1,474.92 26.08.2014

Option -III 10,422.51 26.08.2014

Option -IV 2,274.12 26.08.2014

Option -V 66,988.63 26.08.2012

Total 95,784.73

Total Secured Loas 1,517,248.07

(A+B+C+D+E+F)

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Shriram Transport Finance Company Limited
Annexure IX
Secured Loans

Notes:
1. Securtiy
a. Loans aggregating to Rs. 1,034,157.01 lacs are secured by loan Receivables.
b. Loans aggregating to Rs. 3.19 lacs are secured by Vehicles.
c. Redeemable Non convertible Debentures aggregating to Rs. 284,487.87 lacs are secured by equitable mortgage of title deeds
of immovable property and secured by charge on fixed assets and hypothecation of loan receivables
d. Privately Placed Redeemable Non convertible Debentures aggregating to Rs. 198,600.00 lacs are secured by equitable
mortgage of title deeds of immovable property and hypothecation of loan receivables
2. Terms as regards Interest/Pre-payment:
a. The Fixed Interest bearing Loans/CC/Non-convertible debentures aggregate to Rs. 822,619.63 Lacs and the floating interest
bearing Loans/CC/Non-convertible debentures aggregate to Rs. 694,628.45 Lacs. Out of fixed interest bearing loans Rs.
26,257.83 lacs are hedged.
b. Out of the above, Loans/CC/Non-convertible debentures aggregating to Rs. 300,432.15 Lacs have an interest reset option.
c. Loans/CC/Non-convertible debentures aggregating to Rs. 716,162.45 Lacs have a Pre-payment option upon payment of
stipulated charges.
d. Loans/Non-convertible debentures aggregating to Rs. 55,130.11 Lacs have a Pre-payment option without payment of
charges.
3. Redeemable Non convertible Debentures issued under NCD Public Issue 2009 aggregating to Rs. 12,696.63 lacs have both
Call & Put option.
4. Privately Placed Redeemable Non convertible Debentures aggregating to Rs. 12,500.00 lacs have Put option.
5. Privately Placed Redeemable Non convertible Debentures - retail aggregating to Rs. 11,534.08 lacs have Put option and
Rs. 188,703.14 lacs have Call option
6. Loans aggregating to Rs. 13,125.00 lacs have Put call option.
7. The bankers have a right to appoint a nominee director in case of loans aggregating to Rs. 168,200.95 Lacs.
8. The Redeemable Non Convertible Debentures may be bought back subject to applicable statutory and/or regulatory
requirements, upon the terms and conditions as may be decided by the company.
9. The company may grant loan against the security of NCDs upon the terms and conditions as may be decided by the
company.

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 Shriram Transport Finance Company Limited
Annexure X

Unsecured Loans

( Rs in Lacs )

Particulars Disbursed As at Repayment Terms

Date of Amount March
Allotment 31, 2010
Redeemable non-convertible debentures
A
UTI - Fixed Maturity Plan - Yearly Series Sep 09 25-Sep-07 2,500.00 2,500.00 Bullet-25/09/2010
2,500.00 2,500.00
B Commercial Papers
UTI-Floating Rate Fund-Stp 4-Aug-09 1,500.00 1,500.00 Bullet-03/08/2010
Religare Trustee Company Private Limited-A/Creligare 4-Aug-09 1,000.00 1,000.00 Bullet-03/08/2010
Credit Opportunities Fund
2,500.00 2,500.00
C Subordinated debts
Oriental Bank Of Commerce 30-Nov-07 1,000.00 1,000.00 Bullet-31/05/2013
UTI - Monthly Income Scheme 29-Jan-08 1,500.00 1,500.00 Bullet-29/07/2013
UTI-Unit Linked Insurance Plan 29-Jan-08 1,000.00 1,000.00 Bullet-29/07/2013
Bank Of India 1-Feb-08 1,500.00 1,500.00 Bullet-01/05/2013
Bank Of India 17-Mar-08 1,500.00 1,500.00 Bullet-17/09/2013
LICMF Liquid Fund 24-Mar-08 5,000.00 5,000.00 Bullet-24/06/2013
UCO Bank 27-Mar-08 1,000.00 1,000.00 Bullet-27/06/2013
LIC MF Liquid Fund 2-May-08 1,700.00 1,700.00 Bullet-03/10/2013
LIC MF Income Plus Fund 2-May-08 800.00 800.00 Bullet-03/10/2013
Hvpnl Employees Pension Fund Trust 4-Aug-08 2,250.00 2,250.00 Bullet-04/08/2018
Food Corporation Of India Cpf Trust 4-Aug-08 1,000.00 1,000.00 Bullet-04/08/2018
Hvpnl Employees Provident Fund Trust 4-Aug-08 750.00 750.00 Bullet-04/08/2018
Gas Authority Of India Limited Employees Provident 4-Aug-08 300.00 300.00 Bullet-04/08/2018
Fund Trust
The Jammu And Kashmir Bank Employees Provident 4-Aug-08 200.00 200.00 Bullet-04/08/2018
Fund Trust
C Subordinated debts
Gail Employees Superannuation Benefit Fund 4-Aug-08 100.00 100.00 Bullet-04/08/2018
Gujarat Alkalies And Chemicals Ltd Employees 4-Aug-08 100.00 100.00 Bullet-04/08/2018
provident Fund Trust
Gail (India) Limited Employees Death-Cum- 4-Aug-08 50.00 50.00 Bullet-04/08/2018
Superannuation Gratuity Scheme
Asbestos Cement Limited Staff Provident Fund 4-Aug-08 40.00 40.00 Bullet-04/08/2018
Provident Fund Of Mangalore Refinery And 4-Aug-08 40.00 40.00 Bullet-04/08/2018
Petrochemicals Limited
Mother Dairy Employees Provident Fund Trust 4-Aug-08 30.00 30.00 Bullet-04/08/2018
GSFC Ltd - Fibre Unit Employees Providend fund Trust 4-Aug-08 30.00 30.00 Bullet-04/08/2018
Trustees Provident Fund Of The Employees Of The Ugar 4-Aug-08 30.00 30.00 Bullet-04/08/2018
Sugar Works Ltd
British High Commission India Staff Provident fund 4-Aug-08 20.00 20.00 Bullet-04/08/2018
Asbestos Cement Limited Employees Provident Fund 4-Aug-08 20.00 20.00 Bullet-04/08/2018
L & T Niro Staff Provident Fund 4-Aug-08 10.00 10.00 Bullet-04/08/2018
Alembic Limited Provident Fund Trust 4-Aug-08 10.00 10.00 Bullet-04/08/2018
Atlas Cycle Industries Provident Fund Trust 4-Aug-08 10.00 10.00 Bullet-04/08/2018
Lubrizol India Limited Employees Provident Fund 4-Aug-08 10.00 10.00 Bullet-04/08/2018

F-45
Shriram Transport Finance Company Limited
Annexure X
( Rs in Lacs )
Subordinated debts
Particulars Date of Disbursed As at Repayment Terms
Allotment Amount March
31, 2010
Chhattisgarh State Electricity Board (CSEB) Provident 5-Nov-08 2,000.00 2,000.00 Bullet-05/11/2018
Fund Trust
Delhi Development Authority 5-Nov-08 1,000.00 1,000.00 Bullet-05/11/2018
Chhattisgarh State Electricity Board Gratuity and Pension 7-Nov-08 1,500.00 1,500.00 Bullet-07/11/2018
Fund Trust
UCO Bank 26-Nov-08 5,000.00 5,000.00 Bullet-26/02/2014

Bank Of Maharashtra 11-Dec-08 2,000.00 2,000.00 Bullet-11/03/2014

Bank Of Baroda 11-Dec-08 2,000.00 2,000.00 Bullet-11/03/2014
The Indian Iron And Steel Co Ltd Provident Institution 11-Dec-08 500.00 500.00 Bullet-11/03/2014
Durgapur Steel Plant Provident Fund 11-Dec-08 200.00 200.00 Bullet-11/03/2014
Ashok Leyland Senior Executives Provident Fund 11-Dec-08 100.00 100.00 Bullet-11/03/2014
Rameshwara Jute Mills Workers Provident Fund trust 11-Dec-08 100.00 100.00 Bullet-11/03/2014
Gujarat Alkalies And Chemicals Ltd Employees 11-Dec-08 50.00 50.00 Bullet-11/03/2014
Provident Fund Trust
Shivani Kumar 11-Dec-08 13.00 13.00 Bullet-11/03/2014
Russell Reynolds Associates India Employees Provident 11-Dec-08 5.00 5.00 Bullet-11/03/2014
Fund
Frank Ross Ltd Employees' Provident Fund 11-Dec-08 5.00 5.00 Bullet-11/03/2014
D S Savant And Sons Employees Provident Fund 11-Dec-08 5.00 5.00 Bullet-11/03/2014
Paushak Ltd Provident Fund 11-Dec-08 5.00 5.00 Bullet-11/03/2014
Afco Fincon Private Ltd. 11-Dec-08 4.00 4.00 Bullet-11/03/2014
Rai And Sons Private Limited Employees Provident Fund 11-Dec-08 4.00 4.00 Bullet-11/03/2014
Mehta And Padamsey Private Limited Employees 11-Dec-08 2.00 2.00 Bullet-11/03/2014
provident Fund
Mehta And Padamsey Surveyors Private Limited staff 11-Dec-08 2.00 2.00 Bullet-11/03/2014
Provident Fund
Hirabai Vithaldas Shubh Trust 11-Dec-08 2.00 2.00 Bullet-11/03/2014
The Metal Rolling Works Limited Employees 11-Dec-08 1.00 1.00
Educational Welfare Trust Bullet-11/03/2014
Sarvodaya Welfare Trust 11-Dec-08 1.00 1.00 Bullet-11/03/2014
Hakamchand Vakhatram Philanthropic Trust 11-Dec-08 1.00 1.00 Bullet-11/03/2014
Life Insurance Corporation Of India 23-Dec-08 100.00 100.00 Bullet-23/03/2014
Karnataka Power Corporation Ltd Emp Contributory 23-Dec-08 100.00 100.00
Provident Fund Trust Bullet-23/03/2014
Maihar Cement Employees Provident Fund 29-Dec-08 30.00 30.00 Bullet-29/12/2018
Century Textiles And Industries Ltd. (Cement Divisions) 29-Dec-08 7.00 7.00
Superannuation Fund Bullet-29/12/2018
Manikgarh Cement Employees Superannuation Welfare 29-Dec-08 4.00 4.00
Trust Bullet-29/12/2018
LIC of India - Gratuity Plus 17-Jan-09 500.00 500.00 Bullet-17/04/2014
Bank of India 2-Apr-09 2,000.00 2,000.00 Bullet-02/07/2014
Air- India Employees Provident Fund 2-Apr-09 500.00 500.00 Bullet-02/07/2014
Hero Honda Motors Ltd 18-Apr-09 1,300.00 1,300.00 Bullet-18/07/2014
The Indian Iron And Steel Co Ltd Provident Institution 18-Apr-09 500.00 500.00 Bullet-18/07/2014
Durgapur Steel Plant Provident Fund 18-Apr-09 200.00 200.00 Bullet-18/07/2014
RKM Provident Fund 18-Apr-09 179.00 179.00 Bullet-18/07/2014
Rameshwara Jute Mills Workers Provident Fund trust 18-Apr-09 100.00 100.00 Bullet-18/07/2014
Radha Govind Samiti 18-Apr-09 100.00 100.00 Bullet-18/07/2014

F-46
 Shriram Transport Finance Company Limited
Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of Disbursed As at Repayment Terms
Allotment Amount March
31, 2010
Megna Jute Mills Provident Fund 18-Apr-09 27.00 27.00 Bullet-18/07/2014
L And T (Kansbahal) Staff And Workmen Provident 18-Apr-09 15.00 15.00
Fund Bullet-18/07/2014
Hakamchand Vakhatram Philanthropic Trust 18-Apr-09 10.00 10.00 Bullet-18/07/2014
Snehal Baid 18-Apr-09 10.00 10.00 Bullet-18/07/2014
Bijay Singh Baid 18-Apr-09 10.00 10.00 Bullet-18/07/2014
Sanjay Kumar Baid 18-Apr-09 10.00 10.00 Bullet-18/07/2014
Wander Limited Employees Provident Fund 18-Apr-09 7.00 7.00 Bullet-18/07/2014
Orient Ceramics Provident Fund Institution 18-Apr-09 7.00 7.00 Bullet-18/07/2014
Burns Philp India Private Limited Employees Provident 18-Apr-09 6.00 6.00
Fund Bullet-18/07/2014
L & T (Kansbahal) Officers And Supervisory staff 18-Apr-09 6.00 6.00
Provident Fund Bullet-18/07/2014
Eskaps (India) Private Ltd. Employees Providend fund 18-Apr-09 5.00 5.00 Bullet-18/07/2014
Mehta And Padamsey Private Limited Employees 18-Apr-09 1.00 1.00 Bullet-18/07/2014
provident Fund
ICICI Bank Ltd 15-Jul-09 3,920.00 3,920.00 Bullet-10/10/2014
Chhattisgarh State Electricity Board Gratuity and Pension 15-Jul-09 440.00 440.00 Bullet-10/10/2014
Fund Trust
Abn Amro Bank N V Employees' Provident Fund 15-Jul-09 150.00 150.00 Bullet-10/10/2014
Aradhana Investments Ltd 15-Jul-09 100.00 100.00 Bullet-10/10/2014
Cheviot Agro Industries Ltd 15-Jul-09 30.00 30.00 Bullet-10/10/2014
R S R Mohota Spg And Wvg Mills Ltd Employees 15-Jul-09 20.00 20.00 Bullet-10/10/2014
provident Fund Trust Hinganghat
Sunderdevi Baid 15-Jul-09 20.00 20.00 Bullet-10/10/2014
Bela Anil Dalal 15-Jul-09 15.00 15.00 Bullet-10/10/2014
Meenakshi Baid 15-Jul-09 15.00 15.00 Bullet-10/10/2014
Aditya Share Dealings And Trading Private Limited 15-Jul-09 15.00 15.00 Bullet-10/10/2014
Cheviot Company Limited Employees Gratuity Trust fnd 15-Jul-09 10.00 10.00 Bullet-10/10/2014
Amrish A Dalal 15-Jul-09 10.00 10.00 Bullet-10/10/2014
Bijay Singh Baid 15-Jul-09 10.00 10.00 Bullet-10/10/2014
Ganpati Share Cap Private Limited 15-Jul-09 10.00 10.00 Bullet-10/10/2014
Mikasa Cosmetics Limited 15-Jul-09 30.00 30.00 Bullet-10/10/2014
Anil Vipin Dalal Huf 15-Jul-09 10.00 10.00 Bullet-10/10/2014
Nikhil Anil Dalal 15-Jul-09 15.00 15.00 Bullet-10/10/2014
Jagdish Rani Basur 15-Jul-09 20.00 20.00 Bullet-10/10/2014
Balkash Exim Pvt Ltd 15-Jul-09 140.00 140.00 Bullet-10/10/2014
Desai Amit Sumanlal Huf 15-Jul-09 20.00 20.00 Bullet-10/10/2014
Central Bank Of India 27-Oct-09 4,500.00 4,500.00 Bullet-27/01/2015
NPS Trustees - LIC Pension Fund Scheme 1 27-Oct-09 1,310.00 1,310.00 Bullet-27/01/2015
Trustees Hindustan Steel Limited Contributory provident 27-Oct-09 1,000.00 1,000.00 Bullet-27/01/2015
Fund, Rourkela
Food Corporation Of India Cpf Trust 27-Oct-09 1,000.00 1,000.00 Bullet-27/01/2015
Air- India Employees Provident Fund 27-Oct-09 600.00 600.00 Bullet-27/01/2015
Allahabad Bank 27-Oct-09 500.00 500.00 Bullet-27/01/2015
Dombivli Nagari Sahakari Bank Ltd 27-Oct-09 500.00 500.00 Bullet-27/01/2015
Nps Trust - A/C Lic Pension Fund - Sg Scheme1 27-Oct-09 200.00 200.00 Bullet-27/01/2015
Gujarat Alkalies And Chemicals Ltd Employees 27-Oct-09 160.00 160.00 Bullet-27/01/2015
provident Fund Trust

F-47
 Shriram Transport Finance Company Limited
Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of Disbursed As at Repayment Terms
Allotment Amount March
31, 2010
Sprism Investment Services P Ltd 27-Oct-09 85.00 85.00 Bullet-27/01/2015
Sushilkumar N Trivedi 27-Oct-09 50.00 50.00 Bullet-27/01/2015
Ashok Leyland Employees Hosur Provident Fund trust 27-Oct-09 30.00 30.00 Bullet-27/01/2015
Centre For Development Of Telematics Employees 27-Oct-09 30.00 30.00 Bullet-27/01/2015
Provident Fund Trust
P Anusha 27-Oct-09 15.00 15.00 Bullet-27/01/2015

The Municipal Co-Op Bank Empl Prov Fund 27-Oct-09 10.00 10.00 Bullet-27/01/2015
Humphreys And Glasgow Directors Superannuation Fund 27-Oct-09 3.00 3.00 Bullet-27/01/2015
Orient Ceramics Provident Fund Institution 27-Oct-09 3.00 3.00 Bullet-27/01/2015

R A Nariman And Co Ltd Employees Provident Fund 27-Oct-09 2.00 2.00 Bullet-27/01/2015
Trust
A. K. Capital Services Ltd. 27-Oct-09 2.00 2.00 Bullet-27/01/2015
United India Insurance Company Limited 31-Oct-09 2,000.00 2,000.00 Bullet-31/10/2019
Bank Of India Provident Fund 31-Oct-09 500.00 500.00 Bullet-31/10/2019
Air- India Employees Provident Fund 31-Oct-09 400.00 400.00 Bullet-31/10/2019
The Kalyan Janata Sahakari Bank Ltd 24-Nov-09 500.00 500.00 Bullet-22/11/2019
The Zoroastrian Co-Operative Bank Ltd 24-Nov-09 500.00 500.00 Bullet-22/11/2019
The Jammu And Kashmir Bank Employee Pension Fund 24-Nov-09 400.00 400.00 Bullet-22/11/2019
Trust
Engineers India Limited Employees Provident Fund 24-Nov-09 300.00 300.00 Bullet-22/11/2019
The Jammu And Kashmir Bank Employees Provident 24-Nov-09 200.00 200.00 Bullet-22/11/2019
Fund Trust
Darashaw & Company Pvt Ltd 24-Nov-09 165.00 165.00 Bullet-22/11/2019
Hooghly Docking Works Provident Fund 24-Nov-09 10.00 10.00 Bullet-22/11/2019
Intervet India Pvt Ltd Employees Provident Fund Trust 24-Nov-09 10.00 10.00 Bullet-22/11/2019
A V George Group Employees Provident Fund Trustees 24-Nov-09 10.00 10.00 Bullet-22/11/2019
Swan Silk Ltd Employees Provident Fund Trust 24-Nov-09 5.00 5.00 Bullet-22/11/2019
Allianz Biosciences Pvt Ltd 31-Dec-09 100.00 100.00 Bullet-31/12/2019
Youth Development Co Op Bank Ltd Kolhapur 31-Dec-09 100.00 100.00 Bullet-31/12/2019
Trustees Hind Lamps Employees Provident Fund( 31-Dec-09 100.00 100.00 Bullet-31/12/2019
Exempted Employees )
Caress Beauty Care Products Pvt Ltd 31-Dec-09 50.00 50.00 Bullet-31/12/2019
Cool Cosmetics Private Limited 31-Dec-09 50.00 50.00 Bullet-31/12/2019
Ashish Navin Shah 31-Dec-09 20.00 20.00 Bullet-31/12/2019
Guljit Chaudhri 31-Dec-09 10.00 10.00 Bullet-31/12/2019
Milan A Shah 31-Dec-09 10.00 10.00 Bullet-31/12/2019

East Commercial Private Ltd. 31-Dec-09 10.00 10.00 Bullet-31/12/2019

S Raja 31-Dec-09 5.00 5.00 Bullet-31/12/2019
Orient Ceramics Provident Fund Instit UTI on 31-Dec-09 4.00 4.00 Bullet-31/12/2019
Manju Pande 31-Dec-09 10.00 10.00 Bullet-31/12/2019
Securities Trading Corporation Of India Limited 31-Dec-09 3,950.00 3,950.00 Bullet-30/06/2015
Associated Capsules Private Limited 31-Dec-09 100.00 100.00 Bullet-30/06/2015
All bank Finance Limited 31-Dec-09 100.00 100.00 Bullet-30/06/2015
Keki Minoo Mistry 31-Dec-09 30.00 30.00 Bullet-30/06/2015

F-48
 Shriram Transport Finance Company Limited
Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of Disbursed As at Repayment Terms
Allotment Amount March
31, 2010
Mathrubhumi Employees Superannuation Fund 31-Dec-09 10.00 10.00 Bullet-30/06/2015
Virendra Ratilal Sangharajka 31-Dec-09 5.00 5.00 Bullet-30/06/2015
Ritu Modani 31-Dec-09 3.00 3.00 Bullet-30/06/2015
Usha Modani 31-Dec-09 2.00 2.00 Bullet-30/06/2015
Anu Khattar 31-Dec-09 1.00 1.00 Bullet-30/06/2015
Shriram Life Insurance Company Limited 6-Jan-10 300.00 300.00 Bullet-06/07/2015
Central Bank Of India 18-Jan-10 5,000.00 5,000.00 Bullet-18/04/2015
Bank Of Maharashtra 22-Jan-10 1,000.00 1,000.00 Bullet-22/04/2015
Food Corporation Of India Cpf Trust 22-Jan-10 200.00 200.00 Bullet-22/04/2015
A. K. Capital Services Ltd. 22-Jan-10 132.00 132.00 Bullet-22/04/2015
Gujarat Alkalies And Chemicals Ltd Employees 22-Jan-10 90.00 90.00 Bullet-22/04/2015
provident Fund Trust
Colgate- Palmolive (India) Ltd Provident Fund 22-Jan-10 50.00 50.00 Bullet-22/04/2015

Ashok Leyland Employees Hosur Provident Fund trust 22-Jan-10 24.00 24.00 Bullet-22/04/2015
The Municipal Co-Op Bank Empl Prov Fund 22-Jan-10 4.00 4.00 Bullet-22/04/2015
Air- India Employees Provident Fund 29-Jan-10 700.00 700.00 Bullet-29/01/2020
Arvind Sahakari Bank Ltd 29-Jan-10 100.00 100.00 Bullet-29/01/2020
Loknete Dattaji Patil Sahkari Bank Ltd.,Lasalgaon 29-Jan-10 50.00 50.00 Bullet-29/01/2020
Sulaimani Co Op. Bank Ltd. 29-Jan-10 40.00 40.00 Bullet-29/01/2020
B.M. Financial Services(India) Private limited 29-Jan-10 5.00 5.00 Bullet-29/01/2020
Huntsman Advanced Materials ( India ) Pvt Ltd 29-Jan-10 3.00 3.00 Bullet-29/01/2020
Employees Gratuity Fund
Petro Araldite Private Limited Employees Provident Fund 29-Jan-10 2.00 2.00 Bullet-29/01/2020
Stci Primary Dealer Limited 29-Jan-10 990.00 990.00 Bullet-29/07/2015
Bank Of India Provident Fund 29-Jan-10 500.00 500.00 Bullet-29/07/2015
The Kalyan Janata Sahakari Bank Ltd 29-Jan-10 250.00 250.00 Bullet-29/07/2015
Model Co Op Bank Ltd 29-Jan-10 200.00 200.00 Bullet-29/07/2015
The Jain Sahakari Bank Limited 29-Jan-10 70.00 70.00 Bullet-29/07/2015
Nandlal Pribhdas Tolani 29-Jan-10 50.00 50.00 Bullet-29/07/2015
Icb Ltd Employees Provident Fund 29-Jan-10 10.00 10.00 Bullet-29/07/2015
Hema Parameswaran 29-Jan-10 2.00 2.00 Bullet-29/07/2015
Vijaya R K 29-Jan-10 1.00 1.00 Bullet-29/07/2015
T P Viswanathan 29-Jan-10 1.00 1.00 Bullet-29/07/2015
Avinash Chandra Sangal 29-Jan-10 2.00 2.00 Bullet-29/07/2015
Lotus Beauty Care Products Pvt Ltd 15-Feb-10 100.00 100.00 Bullet-15/02/2020
KOTAK Mahindra Bank Ltd 29-Mar-10 5,000.00 5,000.00 Bullet-29/09/2015
80,097.00 80,097.00
D Term Loan from Banks
Particulars Date of Disbursed As at Repayment Terms
Allotment Amount March
31, 2010
ICICI Bank 11-Sep-09 10,000.00 10,000.00 Bullet-11/03/2011
HSBC Bank 21-Sep-07 22,500.00 8,000.00 3 unequal installment
HSBC Bank 29-Oct-09 52,647.21 52,647.21 Various dt from 26/07/10 to
26/07/12
85,147.21 70,647.21

F-49
 Shriram Transport Finance Company Limited
Annexure X
Unsecured Loans
( Rs in Lacs )

E Term Loan from Instituition

Particulars Date of Disbursed As at Repayment Terms
Allotment Amount March
31, 2010
KOTAK Mahindra Prime Ltd 20-Mar-07 7,500.00 7,500.00 Bullet-22/09/2010
KOTAK Mahindra Prime Ltd 16-Mar-07 11,000.00 11,000.00 Bullet-16/06/2010
KOTAK Mahindra Prime Ltd 30-Mar-07 16,500.00 16,500.00 Bullet-30/06/2010
35,000.00 35,000.00

( Rs in Lacs )
F Inter corporate Deposits
Particulars Date of Disbursed As at March 31, Repayment Terms
Allotment Amount 2010
12 Quarterly
Shakti Finance 13-Feb-08 31.68 4.43 installments
16 Quarterly
Shakti Finance 26-Feb-08 88.97 12.25 installments
120.65 16.68

G Fixed Deposits - Retail Investors 11,479.51 Redeemable at par

over a period 12 to 60
months
H Subordinated Debts - Retail Investors 126,502.49 Redeemable at par
over a period 61 to 88
months
Total Unsecured 328,742.89
Loans(A+B+C+D+E+F+G+H)

Notes:
1 Terms as regards Interest/Pre-payment:
a The Fixed Interest bearing Loans/Commercial Paper/Non-convertible debentures/Subordinated Debt/Fixed
Deposit/Inter corporate Deposits aggregate to Rs. 233,595.68 Lacs and the floating interest bearing
Loans/Subordinated Debts aggregate to Rs. 95,147.21 Lacs.
b Loans aggregating to Rs. 35,000.00 Lacs have an interest reset option.
c Loans aggregating to Rs. 53,000.00 Lacs have a Pre-payment option upon payment of stipulated charges.
2 The Public Deposits may be foreclosed subject to applicable statutory and/or regulatory requirements.

3 The company may, subject to applicable statutory and/or regulatory requirements, grant loan against the security of
Public Deposits upon the terms and conditions as may be decided by the company.

F-50
Shriram Transport Finance Company Limited

Capitalization Statement Annexure XI

(Rs. in lacs)

Pre issue as at March

31, 2010 (Audited)
Particulars As adjusted for issue

Debt

Short Term Debt 122,829.76 122,829.76

Long Term Debt 1,723,161.21 1,773,161.21

Total 1,845,990.97 1,895,990.97

Share holders Fund

Share Capital 22,554.18 22,554.18

Share application money pending allotment 5.22 5.22
Stock Option Outstanding 757.02 757.02
Reserves & Surplus (Refer Annexure IV - Schedule 10) 360,922.10 360,922.10
Less: Miscellaneous Expenditure 3,708.69 3,708.69

Total of Share holders Fund 380,529.83 380,529.83

Long Term Debt /Equity Ratio 4.53 4.66

F-51
 Annexure XII
Shriram Transport Finance Company Limited.

Statement of Tax Shelter

(Rs in Lacs)
For Nine
For the year months
ended March ended
31, December
Particulars 31, For the year ended 31st March
2010 2009 2009 2008 2007 2006 2005

Profit as per accounting books 132,459.12 91,194.27 92,063.11 60,583.30 28,922.42 21,616.87 7,786.89
Tax Rate 33.99% 33.99% 33.99% 33.99% 33.66% 33.66% 36.59%

Tax on Accounting Profit

45,022.85 30,996.93 31,292.25 20,592.26 9,735.29 7,276.24 2,849.42

Permanent Differences

Donation 80.90 25.75 52.80 49.91 49.84 42.68 28.19

Exempt Dividend Income (874.71) (874.71) (486.91) (519.33) (20.84) (2.12) (0.06)
Disallowance u/s 14A 322.39 322.39 50.00 51.54 - - -
Capital gains on sale of fixed assets 5,975.27 5,975.27
Others 2,593.79 296.10 2,981.77 976.23 (60.50) 406.94 18.52
Sub Total (A) 8,097.64 5,744.80 2,597.66 558.35 (31.50) 447.50 46.65

Temporary Differences

Disallowances U/s 43B 146.44 119.59 227.65 120.73 5.66 5.24 -

Depreciation and Lease adjustments 401.95 394.58 7,333.07 13,149.77 10,185.89 (8,982.21) (4,276.08)
Additional finance charges (offered to - - - - - - 87.09
Income tax on cash basis)
Deferred Revenue Expenses (2,217.22) (3,543.21) - 92.88 98.95 193.14 163.73
Service tax write off - 1,303.34 1,777.35 2,721.92 1,756.60 171.91
Delinquency Provision for
Securitisation 7,981.41 3,324.03 4,464.01 511.64 970.33 - -
Others 174.00 119.91 (5,020.77) 838.87 42.61 2,741.49 21.25
Sub Total (B) 6,486.58 414.90 8,307.30 16,491.24 14,025.36 (4,285.74) (3,832.10)

Net Adjustments (A+B) 14,584.22 6,159.70 10,904.96 17,049.59 13,993.86 (3,838.24) (3,785.45)

Tax Impact on Net Adjustments 4,957.18 2,093.68 3,706.60 5,795.16 4,710.33 (1,291.95) (1,385.19)
Total Taxation 49,980.03 33,090.61 34,998.86 26,387.42 14,445.62 5,984.29 1,464.23
Current Tax Provision for the year 49,980.03 33,090.61 34,998.86 26,387.42 14,445.62 5,984.29 1,464.23

Notes:
1. Profits after tax are often affected by the tax shelters which are available.
2. Some of these are of a relatively permanent nature while others may be limited in point of time.
3. Tax provisions are also affected by timing differences which can be reversed in future.

F-52
Schedules forming part of the Reformatted Summary Statement
Annexure XIII
Significant Accounting Policies

(a) Basis of preparation

The financial statements have been prepared in conformity with generally accepted
accounting principles to comply in all material respects with the notified Accounting
Standards (‘AS’) under Companies Accounting Standard Rules, 2006, as amended, the
relevant provisions of the Companies Act, 1956 (‘the Act’) and the guidelines issued by the
Reserve Bank of India (‘RBI’) as applicable to a Non Banking Finance Company (‘NBFC’).
The financial statements have been prepared under the historical cost convention on an
accrual basis. The accounting policies have been consistently applied by the Company and are
consistent with those used in the previous year.
Upto the year ended March 31, 2005
The financial statements have been prepared in conformity with generally accepted
accounting principles to comply in all material respects with mandatory Accounting Standards
(‘AS’) issued by the Institute of Chartered Accountants of India (‘ICAI’), the relevant
provisions of the Companies Act, 1956 (‘the Act’) and the guidelines issued by the Reserve
Bank of India (‘RBI’) as applicable to a Non Banking Finance Company (‘NBFC’). The
financial statements have been prepared under the historical cost convention on an accrual
basis. The accounting policies have been consistently applied by the Company and are
consistent with those used in the previous year.

(b) Use of estimates

The preparation of financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent liabilities at the date of the
financial statements and the results of operations during the reporting period end. Although
these estimates are based upon management’s best knowledge of current events and actions,
actual results could differ from these estimates. Any revisions to the accounting estimates are
recognized prospectively in the current and future periods.

(c) Fixed Assets, Depreciation/Amortisation and Impairment of assets

Fixed Assets
Fixed assets include the assets given on operating lease. Fixed assets are stated at cost less
accumulated depreciation/amortisation and impairment losses, if any. Cost comprises the
purchase price and any attributable cost of bringing the asset to its working condition for its
intended use. Borrowing costs relating to acquisition of fixed assets which takes substantial
period of time to get ready for its intended use are also included to the extent they relate to the
period till such assets are ready to be put to use.
Depreciation/Amortisation
Depreciation/Amortisation is provided on Straight Line Method (‘SLM’), which reflect the
management’s estimate of the useful lives of the respective fixed assets and are greater than or
equal to the corresponding rates prescribed in Schedule XIV of the Act. The assets for which
rates higher used are as follows :

F-53
 Particulars Rates (SLM) Schedule XIV rates (SLM)
Windmills 10% 5.28%
Computer Software 33.33% 16.67%

Windmills are amortised over the remaining life of the asset, the life of windmills are
estimated to be 10 years.

Leasehold improvement is amortised over the primary period of lease subject to a maximum
of 60 months.

All fixed assets individually costing Rs. 5,000 or less are fully depreciated in the year of
installation.

Depreciation on assets sold during the period is recognized on a pro-rata basis to the profit
and loss account till the date of sale.

Impairment of assets
The carrying amount of assets is reviewed at each balance sheet date if there is any indication
of impairment based on internal/external factors. An impairment loss is recognized wherever
the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is
the greater of the assets, net selling price and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value at the weighted average cost
of capital.
After impairment, depreciation is provided on the revised carrying amount of the asset over its
remaining useful life.
A previously recognized impairment loss is increased or reversed depending on changes in
circumstances. However the carrying value after reversal is not increased beyond the carrying
value that would have prevailed by charging usual depreciation if there was no impairment.
Upto the year ended March 31, 2007

Depreciation
Depreciation is provided using the Straight Line Method (‘SLM’) at the rates prescribed
under schedule XIV of the Act, which is management’s estimate of useful lives of the assets.
• On the assets acquired up to December 15, 1993 at the rates applicable to said assets
till that date;

• On the assets acquired on or after December 16, 1993 at revised rates prescribed in the
said Schedule XIV;

• Fixed assets having an original cost less than or equal to Rs.5,000 individually are
fully depreciated in the year of purchase or installation;

• The depreciation for the year includes the difference between the book value of the
leased assets and the value realized in respect of the termination of the leased assets
during the year. In respect of the leased assets, lease equalization / adjustment
accounts are created for the shortfall in capital recovery and adjusted in depreciation /
fixed assets.

F-54
 Intangible Assets
Costs relating to acquisition and development of computer software are capitalized in
accordance with the AS 26 ‘Intangible Assets’ issued by the ICAI and are amortised on a
straight line method basis over a period of six years, which is managements estimate of its
useful life.
The carrying value of computer software is reviewed for impairment annually when the asset
is not yet in use, and otherwise when events or changes in circumstances indicate that the
carrying value may not be recoverable.

(d) Investments
Investments intended to be held for not more than a year are classified as current investments.
All other investments are classified as long-term investments. Current investments are carried
at lower of cost and market value /realizable value determined on an individual investment
basis. Long-term investments are carried at cost. However, provision for diminution in value is
made to recognise a decline, other than temporary, in the value of the investments.
(e) Provisioning / Write-off of assets
Loan and lease receivables are written off / provided for, as per management estimates,
subject to the minimum provision required as per Non- Banking Financial (Deposit Accepting
or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007. Delinquencies on
assets securitized are provided for based on management estimates of the historical data.

Upto the year ended March 31, 2007

Loans, hire purchase and lease receivables are written off / provided for, as per management
estimates, subject to the minimum provision required as per Non- Banking Financial
Companies Prudential Norms (Reserve Bank) Directions, 1998. Delinquencies on assets
securitized are provided for based on management estimates of the historical data.

(f) Hypothecation loans

Hypothecation loans are stated at the amount advanced including finance charges accrued and
expenses recoverable, as reduced by the amounts received up to the balance sheet date and
loans securitized.
(g) Leases
Where the Company is the lessor
Assets given under a finance lease are recognised as a receivable at an amount equal to the net
investment in the lease. Lease rentals are apportioned between principal and interest on the
internal rate of return (‘IRR’). The principal amount received reduces the net investment in
the lease and interest is recognised as revenue. Initial direct costs are recognised immediately
in the Profit and Loss Account.
Assets given on operating lease are included in fixed assets. Lease income is recognised in the
Profit and Loss Account on a straight-line basis over the lease term. Costs, including
depreciation are recognised as an expense in the Profit and Loss Account. Initial direct costs
such as legal costs, brokerage costs, etc. are recognised immediately in the Profit and Loss
Account.
Where the Company is the lessee
Leases where the lessor effectively retains substantially all the risks and benefits of ownership

F-55
 of the leased term, are classified as operating leases. Operating lease payments are recognized
as an expense in the Profit and Loss account on a straight-line basis over the lease term.
(h) Foreign currency translation
Initial recognition
Transactions in foreign currency entered during the period are recorded at the exchange rates
prevailing on the date of the transaction.
Conversion
Monetary assets and liabilities denominated in foreign currency are translated in to rupees at
exchange rate prevailing on the date of the Balance Sheet.
Exchange differences
All exchange differences are dealt with in the profit and loss account.
(i) Inventories
Inventories are valued as follows:
Raw materials, components, stores and spares:
Lower of cost and net realizable value. Cost is determined on a weighted average basis. Net
realizable value is the estimated selling price in the ordinary course of business, less estimated
costs of completion and estimated costs necessary to make the sale.

(j) Revenue recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to
the Company and the revenue can be reliably measured.
i. Finance and service charges on financial lease/ loans is recognised on the basis of
internal rate of return.

ii. Income recognized and remaining unrealized after installments become overdue for six
months or more in case of secured loans and twelve months or more in case of financial
lease transactions are reversed and are accounted as income when these are actually
realized.

iii. Additional finance charges / additional interest are treated to accrue only on realization,
due to uncertainty of realization and are accounted accordingly.

iv. Gains arising on securitization/direct assignment of assets is recognized over the tenure
of agreements as per guideline on securitization of standard assets issued by RBI, loss,
if any is recognised upfront.
Upto the year ended March 31, 2006

Gain or loss arising on securitization/direct assignment up to January 31, 2006 is

recognized upfront on the transfer of such assets.

v. Income from power generation is recognized as per the terms of the Power Purchase
Agreements with State Electricity Boards and on supply of power to the grid.
vi. Income from services is recognized as per the terms of the contract on accrual basis.

vii. Interest income on fixed deposits/margin money, call money(CBLO) certificate of

deposits and pass through certificates is recognized on a time proportion basis taking
into account the amount outstanding and the rate applicable.

F-56
 viii. Dividend is recognized as income when right to receive payment is established by the
date of balance sheet.
ix. Profit/loss on the sale of investments is recognized at the time of actual
sale/redemption.
x. Income from operating lease is recognized as rentals, as accrued on straight line basis
over the period of the lease.
(k) Employee benefits
Provident Fund
All the employees of the Company are entitled to receive benefits under the Provident Fund, a
defined contribution plan in which both the employee and the Company contribute monthly at
a stipulated rate. The Company has no liability for future Provident Fund benefits other than
its annual contribution and recognizes such contributions as an expense in the period it is
incurred.
Gratuity
The Company provides for the gratuity, a defined benefit retirement plan covering all
employees. The plan provides for lump sum payments to employees at retirement, death while
in employment or on termination of employment. The Company accounts for liability of
future gratuity benefits based on an external actuarial valuation on projected unit credit
method carried out for assessing liability as at the reporting date.
Leave Encashment
Short term compensated absences are provided for based on estimates. Long term
compensated absences are provided for based on actuarial valuation. The actuarial valuation
is done as per projected unit credit method as at the reporting date.
Actuarial gains/losses are immediately taken to profit and loss account and are not deferred.

(l) Income tax

Tax expense comprises of current, deferred and fringe benefit tax. Current income tax and
fringe benefit tax is measured at the amount expected to be paid to the tax authorities in
accordance with the Indian Income Tax Act, 1961. Deferred income taxes reflects the impact
of current period timing differences between taxable income and accounting income for the
period and reversal of timing differences of earlier periods.
Deferred tax is measured based on the tax rates and the tax laws enacted or substantively
enacted at the balance sheet date. Deferred tax assets are recognized only to the extent that
there is reasonable certainty that sufficient future taxable income will be available against
which such deferred tax assets can be realized. In situations where the Company has
unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognized
only if there is virtual certainty supported by convincing evidence that they can be realized
against future taxable profits.

The un-recognized deferred tax assets are re-assessed by the Company at each balance sheet
date and are recognized to the extent that it has become reasonably certain or virtually certain,
as the case may be that sufficient future taxable income will be available against which such
deferred tax assets can be realized.

The carrying cost of the deferred tax assets are reviewed at each balance sheet date. The
Company writes down the carrying amount of a deferred tax asset to the extent that it is no
longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable

F-57
 income will be available against which deferred tax asset can be realized. Any such write
down is reversed to the extent that it becomes reasonably certain or virtually certain, as the
case may be, that sufficient future taxable income will be available.
(m) Segment reporting policies

Identification of segments:
The Company’s operating businesses are organized and managed separately according to the
nature of products and services provided, with each segment representing a strategic business
unit that offers different products and serves different markets. The analysis of geographical
segments is based on the areas in which major operating divisions of the Company operate.
Unallocated items:
Unallocated items include income and expenses which are not allocated to any reportable
business segment.
Segment Policies :
The company prepares its segment information in conformity with the accounting policies
adopted for preparing and presenting the financial statements of the company as a whole.
(n) Earnings per share

Basic earnings per share is calculated by dividing the net profit or loss for the period
attributable to equity shareholders (after deducting attributable taxes) by the weighted average
number of equity shares outstanding during the period.
For the purpose of calculating diluted earnings per share, the net profit or loss for the period
attributable to equity shareholders and the weighted average number of shares outstanding
during the period are adjusted for the effects of all dilutive potential equity shares.
(o) Provisions

A provision is recognised when the company has a present obligation as a result of past event;
it is probable that outflow of resources will be required to settle the obligation, in respect of
which a reliable estimate can be made. Provisions are not discounted to its present value and
are determined based on best estimate required to settle the obligation at the balance sheet
date. These are reviewed at each balance sheet date and adjusted to reflect the current best
estimates.

(p) Cash and cash equivalents

Cash and cash equivalents in the cash flow statement comprise cash at bank and in hand,
cheques on hand, remittances in transit and short term investments with an original maturity
of three months or less.

(q) Public issue expenses on issue of Equity shares/Debentures

Public issue expenses incurred on issue of equity shares, preference shares and convertible
debentures are charged on a straight line basis over a period of 10 years.
Public issue expenses incurred on issue of non convertible debentures are charged off on a
straight line basis over the weighted average tenor of underlying debentures.

F-58
(r) Ancillary cost of borrowings

Ancillary cost of borrowings are charged to Profit & Loss account in the period in which they
are incurred.

Upto the year ended March 31,2007

Expenses on mobilization of deposit/debentures have been charged to profit and loss account
in the year in which they are incurred. However, expenses incurred upto March 31, 2003 have
been charged to profit and loss account on the basis of duration of deposit/debenture.

(s) Derivative instruments

The Company uses derivative financial instruments of interest rate swaps to hedge its risks
associated with fluctuations in the interest rate.
As per the Institute of Chartered Accountants of India (ICAI) Announcement, accounting for
derivative contracts, other than those covered under AS-11, are marked to market and the net
loss after considering the offsetting effect on the underlying hedge item is charged to the
income statement. Net gains are ignored.

For the year ended March 31, 2007

Interest rate swap
Swap contracts are initially recognized at fair value on the date on which a derivative contract
is entered into and subsequently remeasured at fair value. Any gain or loss arising from
change in fair value is taken directly to net profit or loss for the year.

(t) Employee stock compensation costs

Measurement and disclosure of the employee share-based payment plans is done in

accordance with SEBI (Employee Stock Option Scheme and Employee Stock Purchase
Scheme) Guidelines, 1999 and the Guidance Note on Accounting for Employee Share-based
Payments, issued by ICAI. The Company measures compensation cost relating to employee
stock options using the intrinsic value method. Compensation expense is amortized over the
vesting period of the option on a straight line basis.

F-59
Notes to Accounts for the year 2009 – 2010
1. Secured Loans

a) (i) Privately placed Redeemable Non-convertible Debentures of Rs.1,000/- each

As at March As at March
31, 2010 31, 2009
Number 1,88,70,314 19,697,934
Amount Rs in lacs 1,88,703.14 196,979.34

Secured by equitable mortgage of title deeds of immovable property. Further secured by charge on plant and
machinery, furniture and other fixed assets of the Company, charge on Company’s hypothecation loans,
other loans, advances and investments of the Company subject to prior charges created or to be created in
favour of the Company’s bankers, financial institutions and others.

Debentures are redeemable at par over a period of 12 months to 160 months from the date of allotment
depending on the terms of the agreement. The earliest date of redemption is 01.04.2010 (March 31, 2009:
01.04.2009)

Debentures may be bought back subject to applicable statutory and/or regulatory requirements, upon the
terms and conditions as may be decided by the Company. The Company may grant loan against the security
of NCDs upon the terms and conditions as may be decided by the Company.

(ii) Privately Placed Redeemable Non-Convertible Debenture of Rs.1,000,000/- each

Amount (Rs. in lacs)

Redeemable at par
Date of As at March 31, As at March 31, on
Allotment/renewal 2010 2009
04.07.2007 - 04.07.2009
5,000.00
05.07.2007
5,000.00 05.07.2010
5,000.00
09.07.2007
- ***05.07.2010
10,000.00

09.07.2007 7,000.00 7,000.00 09.07.2010

11.07.2007 1,000.00 1,000.00 09.07.2010

17.07.2007 - 10,000.00 17.07.2009

25.07.2007 10,000.00 12,500.00 25.07.2010

25.07.2007 2,500.00 2,500.00 25.07.2010

F-60
 Amount (Rs. in lacs)

Date of As at March 31, As at March 31,

Allotment/renewal 2010 2009 Redeemable at par on

30.07.2007 - 2,500.00 30.07.2009

28.08.2007 - 2,500.00 28.04.2009

04.09.2009
07.09.2007 - 4,000.00

10.09.2007 2,500.00 2,500.00 10.09.2010

13.09.2007 - 1,000.00 13.09.2009

21.09.2007 - 2,500.00 ***21.09.2010

05.10.2007 - 2,000.00 05.10.2009

05.10.2007 - 1,500.00 ***05.10.2010

09.10.2007 - 2,500.00 09.10.2009

12.10.2007 - 2,500.00 28.09.2009

15.10.2007 2,000.00 2,000.00 15.10.2010

18.10.2007 3,900.00 12,000.00 18.10.2010

19.10.2007 5,000.00 5,000.00 19.10.2010

19.10.2007 - 8,000.00 18.10.2009

22.10.2007 - 2,500.00 22.10.2009

30.10.2007 - 5,000.00 30.10.2009

02.05.2008 15,000.00 15,000.00 02.05.2011

20.06.2008 10,000.00 10,000.00 20.06.2011

F-61
 Amount (Rs. in lacs)
Date of
Allotment/renewal As at March 31, 2010 As at March 31, 2009 Redeemable at par on

18.08.2008 - 29,000.00 06.03.2010

04.09.2008 - 3,500.00 ***04.04.2010

04.09.2008 - 1,500.00 20.02.2010

04.09.2008 10,000.00 10,000.00 04.09.2010

05.09.2008 - 7,500.00 10.09.2009

08.09.2008 3,000.00 3,000.00 08.09.2010

15.09.2008 1,500.00 1,500.00 15.09.2011

15.09.2008 1,500.00 1,500.00 15.09.2010

15.09.2008 - 2,500.00 15.03.2010

15.09.2008 2,500.00 2,500.00 15.09.2010

15.09.2008 - 2,500.00 15.03.2010

15.09.2008 1,500.00 1,500.00 30.04.2010

16.09.2008 2,500.00 2,500.00 16.09.2011

17.09.2008 8,000.00 8,000.00 01.09.2011

24.09.2008 2,500.00 2,500.00 24.09.2010

26.09.2008 2,500.00 2,500.00 26.09.2010

26.09.2008 1,500.00 1,500.00 10.09.2010

08.10.2008 1,200.00 1,200.00 06.04.2010

24.10.2008 5,000.00 5,000.00 10.12.2010

F-62
 Date of Amount (Rs. in lacs)
Allotment/renewal As at March 31, 2010 As at March 31, 2009 Redeemable at par on

03.11.2008 30,000.00 30,000.00 03.11.2013

26.11.2008 1,000.00 1,000.00 26.11.2013

17.12.2008 - 19,000.00 17.12.2009

24.03.2009 - 2,400.00 24.03.2010

25.03.2009 - 2,600.00 25.03.2010

28.03.2009 5,000.00 5,000.00 28.03.2012

*13.04.2009 10,000.00 - 13.04.2011

**20.04.2009 2,500.00 - 20.04.2011

17.06.2009 2,500.00 - 17.06.2011

30.06.2009 25,000.00 - 30.06.2011

14.09.2009 1,500.00 - 05.04.2011

12.10.2009 9,000.00 - 12.04.2011

24.03.2010 2,400.00 - 24.03.2011

25.03.2010 2,600.00 - 25.03.2011

TOTAL 198,600.00 285,700.00

Secured by specific assets covered under hypothecation loan agreements and by way of exclusive charge and
equitable mortgage of title deeds of immovable property.
*Put/call option on April 13, 2010
**Put/call option on April 20, 2010
*** Early redemption

Debentures may be bought back subject to applicable statutory and/or regulatory requirements, upon the
terms and conditions as may be decided by the Company.

F-63
 (iii) Public issue of Redeemable Non-convertible Debentures of Rs.1,000/- each
Amount (Rs. in lacs)
Date of
Allotment/rene As at March 31, As at March Redeemable at par Put and
wal 2010 31, 2009 on Call option
Option -I 3,489.95 - 26.08.2012 -
Option -I 3,489.95 - 26.08.2013 -
Option -I 1,744.97 - 26.08.2014 -
Option -II 2,949.84 - 26.08.2012 -
Option -II 2,949.84 - 26.08.2013 -
Option -II 1,474.92 - 26.08.2014 -
Option -III 10,422.51 - 26.08.2014 26.08.2013
Option -IV 2,274.12 - 26.08.2014 26.08.2013
Option -V 66,988.63 - 26.08.2012 -

Total 95,784.73 -

a. Secured by specific assets covered under hypothecation loan agreements and by way of exclusive charge and
equitable mortgage of title deeds of immovable property.

b. The proceeds of public issue of Non convertible debentures have been utilised for financing activities.

c. Debentures may be bought back subject to applicable statutory and/or regulatory requirements, upon the
terms and conditions as may be decided by the Company. The Company may grant loan against the security of
NCDs upon the terms and conditions as may be decided by the Company.

b) Term Loans :
(Rs. in lacs)
As at March 31, As at March 31,
2010 2009
i. From Financial Institutions / Corporates :

(a) Secured by an exclusive charge by way

of hypothecation of specific movable
assets being fixed/current assets relating 12,188.42 41,893.90
to hypothecation loans
(b) Secured by an exclusive charge by way of
hypothecation of specific immovable/ -
1,420.12
movable assets pertaining to the wind farm
(c) Secured by an exclusive charge by way of
hypothecation of specific immovable/
movable assets pertaining to the wind farm -
754.40
and guaranteed by a former Director.

F-64
 As at March 31, As at March 31,
2010 2009
ii. From Foreign Institution:
Secured by an exclusive charge by way of
hypothecation of specific hypothecation loan
-
agreements and all amounts owing to and received by 724.27
the Company pursuant to the above Agreements
Total 12,188.42 44,792.69

(Rs. in lacs)
As at March 31, As at March 31,
2010 2009

iii. From Banks :

(a) Secured by hypothecation of vehicles 3.19 6.36
(b) Secured by an exclusive charge by way of
hypothecation of specific movable assets 929,931.95 830,676.33
being fixed / current assets relating to
hypothecation loans*
(c) Secured by an exclusive charge by way of
hypothecation of specific immovable/ - 969.99
movable assets pertaining to the wind
farm
(d) Secured by an exclusive charge by way of
hypothecation of specific immovable/ - 1,710.90
movable assets pertaining to the bio mass
plant.
Total 929,935.14 833,363.58

*includes Rs. 20,000.00 lacs (March 31, 2009 : Rs 7,500.00 lacs) the charge in respect of which has since
been created and Rs.47,000 lacs (March 31, 2009 : Rs Nil lacs) on which charge is yet to be created.

c) Cash Credit from Banks

(Rs. in lacs)
As at March 31, As at March 31,
2010 2009
Cash Credit from banks * 92,036.64 316,623.70
Secured by hypothecation of specific assets covered under hypothecation loan agreements.
*Includes Rs.10,000.00 lacs (March 31, 2009: Nil) the charge in respect of which has since been created.

2. Subordinated Debt
The Company has raised capital by issue of subordinated debt bonds amounting to Rs. 53,196.13
Lacs (March 31, 2009: Rs. 60,553.56 Lacs) with coupon rate of 9.5% to 13% per annum which are
redeemable over a period of 62 months to 122 months.

F-65
 3.
Final dividend (including tax on dividend) includes an amount of Rs. 380.45 lacs in respect of
dividend paid by the Company for the year ended March 31, 2009 on 81,29,550 equity shares as
these have been allotted before the record date for declaration of dividend for the year ended
March 31, 2009, and they rank pari-passu with the existing equity shares for dividend.

4. Gratuity and other post-employment benefit plans:

The Company has an unfunded defined benefit gratuity plan. Every employee who has completed
five years or more of service is eligible for a gratuity on separation at 15 days salary (last drawn
salary) for each completed year of service.
Consequent to the adoption of revised AS 15 ‘Employee Benefits’ issued under Companies
Accounting Standard Rules, 2006, as amended, the following disclosures have been made as
required by the standard:

Profit and Loss account

Net employee benefit expense (recognized in employee cost) (Rs. in lacs)
Gratuity
Particulars March 31, 2010 March 31, 2009
Current service cost 99.69
191.23
Interest cost on benefit obligation 48.79 33.23
Expected return on plan assets NA NA
Net actuarial (gain) / loss recognised in the year (42.37) 22.48
Past service cost Nil Nil
Net benefit expense 197.65 155.40

Balance sheet
Details of Provision for gratuity (Rs. in lacs)
Gratuity
Particulars March 31, 2010 March 31, 2009
Defined benefit obligation 612.63 463.92
Fair value of plan assets NA NA
612.63 463.92
Less: Unrecognised past service cost Nil Nil
Plan asset / (liability) (612.63) (463.92)

F-66
Changes in the present value of the defined benefit obligation are as follows: (Rs. in lacs)
Gratuity
Particulars March 31, 2010 March 31, 2009
Opening defined benefit obligation 463.92 322.76
Interest cost 48.79 33.23
Current service cost 191.23 99.69
Benefits paid (48.93) (14.24)
Actuarial (gains) / losses on obligation (42.38) 22.48
Closing defined benefit obligation 612.63 463.92

The Company would not contribute any amount to gratuity in 2010-11 as the scheme is unfunded.

The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
Gratuity
Particulars March 31, 2010 March 31, 2009
% %
Investments with insurer NA NA

The principal assumptions used in determining gratuity obligations for the Company’s plan are shown below:
Gratuity
Particulars March 31, 2010 March 31, 2009
Discount Rate 7.5% 7.75%
Increase in compensation cost 5% 5%
Employee Turnover* 5% and 10% 5% and 10%

The estimates of future salary increases, considered in actuarial valuation, are on account of inflation, seniority,
promotion and other relevant factors, such as supply and demand in the employment market.

*5% in case of employees with service period of more than 5 years and 10% for all other employees.

Amounts for the year are as follows: (Rs. in lacs)

Particulars March 31, 2010 March 31, 2009 March 31, 2008
Defined benefit obligation 612.63 463.92 322.76
Plan assets NA NA NA
Surplus / (deficit) (612.63) (463.92) (322.76)
Experience adjustments on plan 101.94
55.56 37.57
liabilities
Experience adjustments on plan assets NA NA NA

F-67
5. The Company is primarily engaged in financing activities. It operates in a single business and geographical segment.
The Company owned windmills and biomass which generate income from sale of electricity and also earned certain
fee based income, these income have the same has been classified as ‘Unallocated reconciling item’ as per
requirements of AS – 17 on ‘Segment Reporting’.
(Rs in lacs)
Year ended March 31, 2010 Year ended March 31, 2009
Unallocated Unallocated
Particulars Financing Financing
reconciling Total reconciling Total
Activities Activities
items items
Segment Revenue
446,275.59 3,688.23 449,963.82 369,788.43 3,324.54 373,112.97
Segment Results (Profit before
tax and after interest on
Financing Segment)
129,278.06 3,468.20 132,746.26 92,782.88 (124.33) 92,658.55
Less: Interest on unallocated
reconciling items - 287.14 287.14 NA 595.44 595.44
Net profit before tax 129,278.06 3,181.06 132,459.12 92,782.88 (719.77) 92,063.11
Less: Income taxes 45,147.38 NA NA 30,822.90
Net profit after tax 87,311.74 NA NA 61,240.21
Other Information:
Year ended March 31, 2010 Year ended March 31, 2009
Unallocated Unallocated
Particulars Financing Financing
reconciling Total reconciling Total
Activities Activities
items items
Segment assets 2,690,171.28 - 2,690,171.28 2,487,258.09 9,673.31 2,496,931.40
Unallocated corporate assets - - 7,472.13 3,017.14
Total Assets 2,690,171.28 - 2,697,643.41 2,487,258.09 9,673.31 2,499,948.54
Segment liabilities 2,312,416.58 - 2,312,416.58 2,262,917.42 5,352.41 2,268,269.83
Unallocated corporate liabilities - - 988.31 15.11
Total Liabilities 2,312,416.58 - 2,313,404.89 2,262,917.42 5,352.41 2,268,284.94
Capital expenditure 624.86 - 624.86 3,369.47 Nil 3,369.47
Depreciation 1,287.84 208.00 1,495.84 1,645.69 1,834.90 3,480.59
Other non - cash expenses 49,753.00 0.94 49,753.94 33,145.16 590.85 33,736.01

F-68
6. Related Party Disclosure

Related party where control exists

Subsidiaries : Shriram Asset & Equipment Finance Private Limited

(formerly Shriram Equipment Finance Private
Ltd.(SAEFPL))
(from June 04, 2009 upto December 14, 2009)

Shriram Equipment Finance Company Ltd. (SEFCL)

(from December 15, 2009)

Shriram Automall India Limited (SAIL)

(from February 11, 2010)

Other Related Parties

Enterprises having significant influence Shriram Holdings (Madras) Private Limited

over the Company : Shriram Capital Limited
Newbridge India Investments II Limited

Associates : Shriram Asset Management Company Limited

Key Managerial Personnel : R Sridhar, Managing Director

Relatives of Key Managerial Personnel : Mrs. Padmapriya Sridhar (spouse)

F-69
 (Rs. in lacs)
Enterprises having
significant influence Key Management Relatives of Key
over the Company Subsidiaries Associates Personnel Management Personnel Total
March 31, March March 31, March March March March March March 31, March 31, March 31, March 31,
2010 31, 2009 2010 31, 2009 31, 2010 31, 2009 31, 2010 31, 2009 2010 2009 2010 2009
Payments/Expenses
Employee benefits for key management
personnel - - - - - - 72.61 62.99 - - 72.61 62.99
Royalty 1,240.78* 1,036.45* - - - - - - - - 1,240.78 1,036.45
Data Sourcing fees 23.96* 87.35* - - - - - - - - 23.96 87.35
Service Charges 143.75* 524.10* - - - - - - - - 143.75 524.10
Reimbursement of business promotion expenses 66.18* - - - - - - - - - 66.18 -
Equity dividend
5,602.29# 4,268.58# - - - - 5.58 4.29 2.43 2.03 5,610.30 4,274.90
Interest on subordinate debt
- - - - 54.37 51.19 - - - - 54.37 51.19
Interest on Inter Corporate Deposit 96.66# 149.52# - - - - - - - - 96.66 149.52
Interest on Non Convertible Debentures
- - - - - - 0.27 - 0.01 - 0.28 -
Investments in shares
- - 220.00 +@& - - - - - - - 220.00 -
Rent paid 59.56* 57.60* - - - - - - - 59.56 57.60
Inter Corporate Deposits
4,200# - - - - - - - - - 4,200.00 -
Amount paid to SAEFPL - - 3.54 - - - - - - - 3.54 -

Amount recoverable from SEFCL - - 2.74 - - - - - - - 2.74 -

Amount recoverable from SAIL
- - 2.30 - - - - - - - 2.30 -
Receipts/Income
Inter Corporate Deposit - 4,200# - - - - - - - - - 4,200.00
Sale of investment in shares
- - 5.00+ - - - - - - - 5.00 -
Amount recovered from SAEFPL - - 3.54 - - - - - - - 3.54 -
Non Convertible Debenture
- - - - - - 1.00 - 1.00 - 2.00 -
Issue of equity shares on conversion of warrants
2,400.00# - - - - - - - - - 2,400.00 -
Rent & electricity reimbursed
- - - - 5.25 5.40 - - - - 5.25 5.40
Balance Outstanding at the year end
Share capital 9,337.15# 8,537.15# - - - - 13.02 8.58 4.05 4.05 9,354.22 8,549.78
Share warrants - 2,400.00# - - - - - - - - - 2,400.00

F-70
 Enterprises having
significant influence Key Management Relatives of Key
over the Company Subsidiaries Associates Personnel Management Personnel Total
March 31, March March 31, March March March March March March 31, March 31, March 31, March 31,
2010 31, 2009 2010 31, 2009 31, 2010 31, 2009 31, 2010 31, 2009 2010 2009 2010 2009
Non Convertible Debenture - - - - - - - - - - - -

Investments in shares - - 215.00@& - 240.00 240.00 - - - - 455.00 240.00

Outstanding expenses 185.43* 67.17* - - - - - - - - 185.43 67.17
Inter Corporate Deposits - 4,200.00# - - - - - - - - - 4,200.00
Rent Deposit given 49.00* 49.00* - - - - - - - - 49.00 49.00
Amount recoverable from SEFCL - - 2.74 - - - - - - - 2.74 -
Amount recoverable from SAIL - - 2.30 - - - - - - - 2.30 -
Interest payable on ICD - 149.52# - - - - - - - - - 149.52

Subordinated debts - - - - 413.40 413.40 - - - - 413.40 413.40

Interest payable on subordinate debt - - - - 85.78 29.36 - - - - 85.78 29.36

F-71
* Denotes transactions with Shriram Capital Limited
# Denotes transactions with Shriram Holdings (Madras) Private Limited
+ Denotes transactions with Shriram Asset and Equipment Finance Private Limited (SAEFPL)
& Denotes transactions with Shriram Equipment Finance Company Limited
@ Denotes transactions with Shriram Automall India Limited

7. Leases

In case of assets given on lease

The Company has given land and building on operating lease for period ranging 11 months to 60
months. During the year, the company had also given its biomass plant on operating lease for the
period 1st April, 2009 to 30th September, 2009. The same was sold on October 1, 2009, hence gross
carrying cost of and accumulated depreciation of the asset as on the date of balance sheet is nil.

In case of assets taken on lease

The Company has taken various office premises, furniture and fixtures, computers and plant and
machinery under operating lease. The lease payments recognized in the profit & loss account are
Rs. 3,557.92 lacs (March 31, 2009: Rs. 2,636.98 lacs). Certain agreements provide for
cancellation by either party and certain agreements contains clause for escalation and renewal of
agreements. The non-cancellable operating lease agreements are ranging for a period 22 to 122
months. There are no restrictions imposed by lease arrangements. There are no sub leases.
The future minimum lease payments in respect of non-cancellable operating lease as at the balance
sheet date are summarized below :

(Rs. in lacs)
As at March 31, As at March 31,
2010 2009
Minimum Lease Payments:
Not later than one year 899.73 408.16
Later than one year but not later than five years 324.11 149.80
Later than five years 40.73 Nil

8. In accordance with the Reserve Bank of India circular no.RBI/2006-07/ 225 DNBS (PD) C.C No.
87/03.02.004/2006-07 dated January 4, 2007, the Company has created a floating charge on the
statutory liquid assets comprising of investment in Government Securities to the extent of Rs.
3,497.70 lacs (March 31, 2009: Rs.283.00 lacs) in favour of trustees representing the public deposit
holders of the Company.

F-72
9. Earnings per share

Particulars Year ended Year ended

March 31, 2010 March 31, 2009
Net Profit after tax as per profit and loss account (Rs. in lacs) (A) 87,311.74 61,240.21
Weighted average number of equity shares for calculating Basic
2125.01 2,033.80
EPS (in lacs) (B)
Weighted average number of equity shares for calculating
2133.85 2,138.29
Diluted EPS (in lacs) (C)
Basic earnings per equity share (in Rupees) (Face value of Rs.
41.09 30.11
10/- per share) (A) / (B)
Diluted earnings per equity share (in Rupees) (Face value of Rs.
10/- per share) (A) / (C) 40.92 28.64

Year ended Year ended

Particulars March 31, 2010 March 31, 2009
Weighted average number of equity shares for calculating EPS
2,125.01 2,033.80
(in lacs)
Add : Equity shares arising on conversion of optionally
0.00 80.00
convertible warrants (in lacs)
Add : Equity shares for no consideration arising on grant of stock
8.84 24.49
options under ESOP (in lacs)
Weighted average number of equity shares in calculation diluted
EPS (in lacs) 2,133.85 2,138.29

F-73
10. Deferred Tax Liabilities/(Asset)(Net) (Rs.in lacs)
The break up of deferred tax asset / liabilities is as As at March 31, As at March 31,
under:- 2010 2009
Deferred Tax Liabilities

Timing difference on account of :

Differences in depreciation in block of fixed assets
Nil 2,482.17
as per tax books and financial books
Debenture Issue Expenses 753.63 Nil
Gross Deferred Tax Liabilities (A) 753.63 2,482.17
Deferred Tax Asset
Timing difference on account of :
Differences in depreciation in block of fixed assets
231.78 Nil
as per tax books and financial books
Expenses disallowed under Income Tax Act, 1961 3,259.93 3,100.49
Provision for securitization 4,734.05 2,021.16
Gross Deferred Tax Assets (B) 8,225.76 5,121.65

Deferred Tax Liabilities /(Assets)(Net) (A-B) (7,472.13) (2,639.48)

(Rs in lacs)
As at March 31, As at March 31,
11. Contingent Liabilities not provided for
2010 2009
a. Disputed income tax/interest tax demand contested in 157.26 164.76
appeals not provided for
[Against the above, a sum of Rs. 29.66 lacs (March 31,
2009: Rs. 29.66 lacs) has been paid under protest]
b. Demands in respect of Service tax 315.00 299.00
[Amount of Rs.15.00 lacs (March 31, 2009 : Rs. 15.00
lacs) has been paid under protest ]
c. Disputed sales tax demand 412.33 -
[Amount of Rs. 63.92 lacs (March 31, 2009: Rs. Nil)
has been paid by the Company]
d. Guarantees issued by the Company & outstanding - 901.97

Future cash outflows in respect of (a), (b) and (c) above are determinable only on receipt of
judgements /decisions pending with various forums/authorities.

F-74
 Recovery of Service tax on lease and hire purchase transactions is kept in abeyance in view of the
12.
petition pending before the Supreme Court of India. If any liability arises it will be recovered from
the concerned parties. However, on contracts that have been terminated, pending the decision from
the Supreme Court of India, equivalent service tax is written off. The company has recognized the
deferred tax asset on the amounts so written off, as in either case service tax liability will be
charged off or reversed as income.

13. Employee Stock Option Plan

Series I Series II Series III Series IV Series V Series VI
Date of grant October April 1, October 9, August 17, July 15, May 13,
31, 2005 2006 2006 2007 2008 2009
Date of May 13,
October February 22, September 6, August 17, July 15,
Board/committe 2009
19, 2005 2006 2006 2007 2008
e Approval
Date of October 13,
October October 13, October 13, October 13, October 13,
Shareholder’s 2005
13, 2005 2005 2005 2005 2005
approval
Number of
2,962,500 832,500 910,000 109,000 77,000 50,000
options granted
Method of
Settlement Equity Equity Equity Equity
Equity Equity
(Cash/Equity)
Graded Vesting Period
After 1 year of 10% of 10% of 10% of 10% of 10% of 10% of options
grant date options options options options options granted
granted granted granted granted granted
After 2 years of 20% of 20% of 20% of 20% of 20% of 20% of options
grant date options options options options options granted
granted granted granted granted granted
After 3 years of 30% of 30% of 30% of 30% of 30% of 30% of options
grant date options options options options options granted
granted granted granted granted granted
After 4 years of 40% of 40% of 40% of 40% of 40% of 40% of options
grant date options options options options options granted
granted granted granted granted granted
Exercisable 10 years 10 years 10 years 10 years 10 years 10 years from
period from from from from from vesting date
vesting vesting vesting vesting vesting
date date date date date
Vesting On achievement of predetermined targets.
Conditions

F-75
 The details of Series I have been summarized below:
As at March 31,2010 As at March 31, 2009
Number of Weighted Number of Weighted
Shares Average Shares Average
Exercise Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 1,839,800 Rs. 35.00 2,177,000 Rs. 35.00
Add: Granted during the year - - - -
Less: Forfeited during the year - - - -
Less: Exercised during the year 16,40,750 Rs.35.00 304,500 Rs.35.00
Less: Expired during the year 9,500 - 32,700 -
Outstanding at the end of the year 1,89,550 Rs.35.00 1,839,800 Rs.35.00
Exercisable at the end of the year 1,89,550 860,540
Weighted average remaining contractual life 8.09 9.09
(in years)
Weighted average fair value of options Rs.59.04 Rs.59.04
granted

The details of Series II have been summarized below:

As at March 31,2010 As at March 31, 2009
Number of Weighted Number of Weighted
Shares Average Shares Average
Exercise Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 516,500 Rs.35.00 554,100 Rs.35.00
Add: Granted during the year - - - -
Less: Forfeited during the year - - - -
Less: Exercised during the year 265,200 Rs.35.00 31,300 Rs.35.00
Less: Expired during the year 6,300
Outstanding at the end of the year 251,300 Rs.35.00 516,500 Rs.35.00
Exercisable at the end of the year 24,900 116,520
Weighted average remaining contractual life 8.49 9.49
(in years)
Weighted average fair value of options granted Rs.91.75 Rs.91.75

The details of Series III have been summarized below:

As at March 31,2010 As at March 31, 2009
Number of Weighted Number of Weighted
Shares Average Shares Average
Exercise Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 7,63,600 Rs.35.00 811,000 Rs.35.00
Add: Granted during the year - - - -
Less: Forfeited during the year - - - -
Less: Exercised during the year 4,02,200 Rs.35.00 40,400 Rs.35.00
Less: Expired during the year 3,500 7,000
Outstanding at the end of the year 3,57,900 Rs.35.00 763,600 Rs.35.00
Exercisable at the end of the year 38,300 202,600
Weighted average remaining contractual life 9.01 10.01
(in years)
Weighted average fair value of options granted Rs.74.85 Rs.74.85

F-76
 The details of Series IV have been summarized below:
As at March 31,2010 As at March 31, 2009
Number of Weighted Number of Weighted
Shares Average Shares Average
Exercise Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 106,000 Rs.35.00 109,000 Rs.35.00
Add: Granted during the year - - - -
Less: Forfeited during the year - - - -
Less: Exercised during the year 31,800 Rs.35.00 - -
Less: Expired during the year - 3,000
Outstanding at the end of the year 74,200 Rs.35.00 106,000 Rs.35.00
Exercisable at the end of the year 10,600
Weighted average remaining contractual life 9.88 10.88
(in years)
Weighted average fair value of options granted 136.40 136.40

The details of Series V have been summarized below:

As at March 31,2010 As at March 31, 2009
Number of Weighted Number of Weighted
Shares Average Shares Average
Exercise Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 77,000 Rs.35.00 - -
Add: Granted during the year - - 77,000 Rs.35.00
Less: Forfeited during the year - - - -
Less: Exercised during the year 7,700 Rs.35.00 - -
Less: Expired during the year - - - -
Outstanding at the end of the year 69,300 Rs.35.00 77,000 Rs.35.00
Exercisable at the end of the year - - - -
Weighted average remaining contractual life 10.78 11.78
(in years)
Weighted average fair value of options granted 253.90 253.90

The details of Series VI have been summarized below:

As at March 31,2010 As at March 31, 2009
Number of Weighted Number of Weighted
Shares Average Shares Average
Exercise Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year - - -
Add: Granted during the year 50,000 Rs.35.00 - -
Less: Forfeited during the year - - - -
Less: Exercised during the year - - - -
Less: Expired during the year - - - -
Outstanding at the end of the year 50,000 Rs.35.00 - -
Exercisable at the end of the year - - - -
Weighted average remaining contractual life 11.61 - -
(in years)
Weighted average fair value of options granted 201.45 - -

The weighted average share price for the period over which stock options were exercised was Rs.358.00
(March 31, 2009: Rs.242.00)
F-77
 The details of exercise price for stock options outstanding at the end of the year are:
March 31, 2010

Series Range of Number of Weighted average Weighted

exercise prices options remaining contractual life average
outstanding of options (in years) exercise price
Series I Rs.35/- 189,550 8.09 Rs.35/-
Series II Rs.35/- 251,300 8.49 Rs.35/-
Series III Rs.35/- 357,900 9.01 Rs.35/-
Series IV Rs.35/- 74,200 9.88 Rs.35/-
Series V Rs.35/- 69,300 10.78 Rs.35/-
Series VI Rs.35/- 50,000 11.61 Rs.35/-

The details of exercise price for stock options outstanding at the end of the year are:
March 31, 2009

Series Range of Number of Weighted average Weighted

exercise prices options remaining contractual life average
outstanding of options (in years) exercise price
Series I Rs.35/- 1,839,800 9.09 Rs.35/-
Series II Rs.35/- 516,500 9.49 Rs.35/-
Series III Rs.35/- 763,600 10.01 Rs.35/-
Series IV Rs.35/- 106,000 10.88 Rs.35/-
Series V Rs.35/- 77,000 11.78 Rs.35/-

Stock Options granted

Series I:

The weighted average fair value of stock options granted was Rs.59.04. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 38.44 38.44 38.44 38.44
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 5.98 6.33 6.54 6.73
Expected dividend rate (%) 2.31 2.31 2.31 2.31

F-78
Series II :

The weighted average fair value of stock options granted was Rs.91.75. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 19.89 19.89 19.89 19.89
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.64 6.83 6.93 7.26
Expected dividend rate (%) 2.52 2.52 2.52 2.52

Series III :

The weighted average fair value of stock options granted was Rs.74.85. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 31.85 31.85 31.85 31.85
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.96 7.10 7.26 7.40
Expected dividend rate (%) 2.52 2.52 2.52 2.52

Series IV :

The weighted average fair value of stock options granted was Rs. 136.40. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 41.51 41.51 41.51 41.51
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 7.68 7.76 7.82 7.87
Expected dividend rate (%) 0.89 0.89 0.89 0.89

F-79
Series V :

The weighted average fair value of stock options granted was Rs. 253.90. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 69.22 69.22 69.22 69.22
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 9.41 9.36 9.34 9.36
Expected dividend rate (%) 1.63 1.63 1.63 1.63

Series VI :

The weighted average fair value of stock options granted was Rs. 201.45. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 64.80 64.80 64.80 64.80
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 5.00 5.00 5.00 5.00
Average risk-free interest rate (%) 4.03 4.68 5.20 5.64
Expected dividend rate (%) 1.96 1.96 1.96 1.96

The expected volatility was determined based on historical volatility data equal to the NSE volatility rate of
Bank Nifty which is considered as a comparable peer group of the Company. To allow for the effects of
early exercise, it was assumed that the employees will exercise the options within six months from the date
of vesting in view of the exercise price being significantly lower than the market price.

Effect of the employee share-based payment plans on the profit and loss account and on its financial
position:

(Rs. in lacs)
As at March 31, As at March 31,
2010 2009
Total compensation cost pertaining to employee share-based payment 341.30 580.57
plan (entirely equity settled)
Liability for employee stock options outstanding as at year end 955.97 2584.88
Deferred compensation cost 198.95 445.98

F-80
Since the enterprise used the intrinsic value method the impact on the reported net profit and
earnings per share by applying the fair value based method is as follows:

In March 2005, ICAI has issued a guidance note on “Accounting for Employees Share Based Payments”
applicable to employee based share plan the grant date in respect of which falls on or after April 1, 2005.
The said guidance note requires that the proforma disclosures of the impact of the fair value method of
accounting of employee stock compensation accounting in the financial statements. Applying the fair value
based method defined in the said guidance note, the impact on the reported net profit and earnings per share
would be as follows:

Year ended March Year ended March

31, 2010 31, 2009
Profit as reported (Rs. in lacs) 87,311.74 61,240.21
Add: Employee stock compensation under intrinsic value
341.30 580.57
method (Rs. in lacs)
Less: Employee stock compensation under fair value method 340.91
553.44
(Rs. in lacs)
Proforma profit (Rs. in lacs) 87,312.13 61267.34
Earnings per share
Basic (Rs.)
- As reported 41.09 30.11
- Proforma 41.09 30.12
Diluted (Rs.)
- As reported 40.92 28.64
- Proforma 40.92 28.65
Nominal Value Rs 10.00 Rs. 10.00

During the year, the Company allotted 11,658,552 equity shares of Rs.10/- each at a premium of Rs.
14.
490.80 per share to Qualified Institutional Buyers (QIBs) in terms of Chapter VIII of SEBI (ICDR)
Regulations, 2009. The Company also converted 8,000,000 warrants which were issued by way of
preferential allotment to Shriram Holdings (Madras) Private Limited into equity shares of Rs.10/- each
at a premium of Rs. 290/-per share. The amount received has enhanced the networth and was utilized
for the purpose of business operations.

15. Securitisation/ Direct assignment

The Company sells loans through securitisation and direct assignment. The information on
securitisation / direct assignment activity of the Company as an originator is given below:

Year ended March Year ended March 31,

31, 2010 2009
Total number of loan assets securitized/directly assigned 380,673 1,49,860
Total book value of loan assets securitized/directly
875,681.04 3,12,498.40
assigned (Rs. in lacs)
Sale consideration received for the securitised
921,631.22 338,334.83
assets/directly assigned (Rs. in lacs)
Gain on account of securitization/direct assignment* (Rs.
262,350.21 41,816.19
in lacs)

* Gain on securitization / direct assignment deals done after February 1, 2006 is amortised over the
period of the loan.
F-81
The information on securitisation / direct assignment activity of the Company as an originator as on March
31, 2010 and March 31, 2009 is given in the table below :
(Rs.in lacs)
As at March 31, As at March 31,
2010 2009
Outstanding credit enhancement
-Fixed Deposit 173,588.14 97,459.32
Outstanding liquidity facility
-Fixed Deposit 23,833.27 17,137.30
Outstanding subordinate contribution 2,665.30 3,301.71

16. Supplementary Statutory Information

(Rs. in lacs)
I Managing Director’s Remuneration Year ended March Year ended March
31, 2010 31, 2009
Salaries 45.46 40.00
Perquisites 7.19 8.13
Contribution to Provident fund 0.09 0.09
Employee stock option scheme 19.87 14.77
72.61 62.99

Note: - As the liabilities for gratuity and leave encashment are provided on an actuarial basis for the
Company as a whole, the amounts pertaining to the Managing Director is not included above

The computation of profits under section 349 of the Act has not been given as no commission is
payable to the Managing Director.

(Rs. in lacs)
II Expenditure in foreign currency (On cash basis)
Year ended March Year ended March
31, 2010 31, 2009
Travelling 4.23 236.38
Others 2.62 3,320.21
6.85 3556.59

III Net dividend remitted in foreign exchange Year ended March 31, Year ended March 31,
2010 2009
Period to which it relates Interim Final Interim Final
2009-10 2008-09 2008-09 2007-08
Number of non-resident shareholders - - 6 6
Number of equity shares held on which - - 42,403,023 42,403,023
dividend was due
Amount remitted (state the foreign currency)
American Dollar - - 840,330 3,966,606
Amount in Rs.(Lacs) 424.03 1696.12

17. Additional information pursuant to the provisions of paragraphs 3, 4C and 4D of Part II of

F-82
 schedule VI to the Act
I Licensed Capacity, Installed capacity, Actual production and Sales
Class of Units Licensed Installed Actual Production Sales Value
Goods Capacity as Capacity as at and Sales for the year
(Rs. in lacs)
at March 31, March 31, ended March 31,
(in KW) (in units)
2010 2009 2010 2009 2010 2009 2010 2009
Electricity- 44 NA NA - 22,430 34,546,664 - 2,251.19*
Windmill
Electricity- 1 NA - 7,500 - 32,192,600 - 1,014.07
Biomass
*Includes compensation charges received towards generation loss.

II Consumption of raw materials – indigenous

Raw material Units Quantity for the year Value for the year ended
ended March 31,
March 31, (Rs in lacs)
2010 2009 2010 2009

Biomass Raw Tons - 69,354 - 687.17

material

18. Based on the intimation received by the Company, none of the suppliers have confirmed to be
registered under “The Micro, Small and Medium Enterprises Development (‘MSMED’) Act, 2006”.
Accordingly, no disclosures relating to amounts unpaid as at the year ended together with interest
paid /payable are required to be furnished.

19. During the year, the Company sold its entire investment in the wholly owned subsidiary, Shriram
Asset and Equipment Finance Private Limited (SAEFPL), which was incorporated on June 04, 2009.
Further, the Company incorporated a wholly owned subsidiary, Shriram Equipment Finance
Company Limited (SEFCL) and Shriram Automall India Limited (SAIL). Both the companies have
not commenced operations till March 31, 2010.

20. In addition to the auditors remuneration shown in operating and other expenses, the Company has also
incurred auditors remuneration in connection with other services provided by auditors in connection
with public issue of non convertible debentures and issue expenses of equity shares of Rs. 40.07 lacs
(including out of pocket expenses of Rs. 0.36 lacs) and Rs. 58.96 lacs (including out of pocket
expenses of Rs. 0.51 lacs) respectively and have been amortised as per note 1(q) and shown under
miscellaneous expenditure.

21. Since the company has not given any loans and advances in the nature of loans to its subsidiaries and
associate and the subsidiaries /associates have not acquired any shares of the company, no disclosures
under clause 32 of the Listing Agreeement are required. The receivables on current accounts
consequent to expenditure incurred on behalf of the subsidiaries and the associate are not treated as
loans and advances in the nature of loans.
F-83
22. During the year company sold windmills to Nupower Renewables Ltd. for a consideration of Rs.
4,882.92 lacs out of which a sum of Rs. 324.71 lacs have been kept in escrow account pending
completion of certain formalities.

23. The auditors’ report dated April 29, 2010 on financial statements as of and for year ended March 31,
2010 included, as on Annexure, a statement on certain matters specified in the Companies (Auditors
Report) Order, 2003, which was modified to indicate that there was an instance of fraud on the
Company by its employee.

24. Previous year Comparatives

The figures for the previous year have been regrouped and reclassified, wherever necessary to
conform to current year’s classification.

F-84
Notes to Accounts for the period ended December 31, 2009

1. Secured Loans

a) (i) Privately placed Redeemable Non-convertible Debentures of Rs.1,000/- each

As at December 31, 2009
Number 19,002,957
Amount Rs in lacs 190,029.57

Secured by equitable mortgage of title deeds of immovable property. Further secured by charge on plant and
machinery, furniture and other fixed assets of the Company, charge on Company’s hypothecation loans,
other loans, advances and other investments of the Company subject to prior charges created or to be created
in favour of the Company’s bankers, financial institutions and others.

Debentures are redeemable at par over a period of 12 months to 160 months from the date of
allotment depending on the terms of the agreement. The earliest date of redemption is 01.01.2010.

(ii) Privately Placed Redeemable Non-Convertible Debenture of Rs.1,000,000/- each

Date of Allotment/renewal Amount (Rs. in lacs) Redeemable at par on

As at December 31, 2009

05.07.2007
5,000.00 05.07.2010

09.07.2007 7,000.00 09.07.2010

11.07.2007 1,000.00 09.07.2010

25.07.2007 12,500.00 25.07.2010

25.07.2007 2,500.00 25.07.2010

10.09.2007 2,500.00 10.09.2010

21.09.2007 2,500.00 21.09.2010

15.10.2007 2,000.00 15.10.2010

18.10.2007 7,000.00 18.10.2010

19.10.2007 5,000.00 19.10.2010

02.05.2008 15,000.00 02.05.2011

20.06.2008 10,000.00 20.06.2011

F-85
Date of Allotment/renewal Amount (Rs. in lacs) Redeemable at par on

As at December 31, 2009

18.08.2008 29,000.00 06.03.2010

04.09.2008 3,500.00 04.04.2010

04.09.2008 1,500.00 20.02.2010

04.09.2008 10,000.00 04.09.2010

08.09.2008 3,000.00 08.09.2010

15.09.2008 1,500.00 15.09.2011

15.09.2008 1,500.00 15.09.2010

15.09.2008 2,500.00 15.03.2010

15.09.2008 2,500.00 15.09.2010

15.09.2008 2,500.00 15.03.2010

15.09.2008 1,500.00 30.04.2010

16.09.2008 2,500.00 16.09.2011

17.09.2008 8,000.00 01.09.2011

24.09.2008 2,500.00 24.09.2010

26.09.2008 2,500.00 26.09.2010

26.09.2008 1,500.00 10.09.2010

08.10.2008 1,200.00 06.04.2010

24.10.2008 5,000.00 10.12.2010

03.11.2008 30,000.00 03.11.2013

26.11.2008 1,000.00 26.11.2013

F-86
 Date of Allotment/renewal Amount (Rs. in lacs) Redeemable at par on
As at December 31, 2009

24.03.2009 2,400.00 24.03.2010

25.03.2009 2,600.00 25.03.2010

28.03.2009 5,000.00 28.03.2012
**13.04.2009 10,000.00
13.04.2011

***20.04.2009 10,000.00 20.04.2011

****20.04.2009 2,500.00 20.04.2011

08.06.2009 7,500.00 08.12.2010

17.06.2009 2,500.00 17.06.2011

30.06.2009 25,000.00 30.06.2011

14.09.2009 1,500.00 05.04.2011

12.10.2009 9,000.00 12.04.2011

TOTAL 263,200.00

Secured by specific assets covered under hypothecation loan agreements by way of exclusive charge and
equitable mortgage of title deeds of immovable property.
*Put/call option on July 25, 2009
**Put/call option on Jan 13, 2010
***Put/call option on March 20, 2010
****Put/call option on Jan 20, 2010

(iii) Public issue of Redeemable Non-convertible Debentures of Rs.1,000/- each

Amount (Rs. in lacs)

Date of Redeemable at par

Allotment/renewal As at December 31, 2009 on Put and Calloption
Option -I 4,107.55 26.08.2012 -
Option -I 4,107.55 26.08.2013 -
Option -I 2,053.78 26.08.2014 -
Option -II 3,158.64 26.08.2012 -
Option -II 3,158.64 26.08.2013 -
Option -II 1,579.32 26.08.2014 -
Option -III 11,241.88 26.08.2014 26.08.2013
Option -IV 2,274.12 26.08.2014 26.08.2013
Option -V 26.08.2012 -
68,318.48
Total 99,999.96

F-87
Secured by specific assets covered under hypothecation loan agreements by way of exclusive charge and
equitable mortgage of title deeds of immovable property.

b) Term Loans :
(Rs. in lacs )
As at December 31, 2009
From Financial Institutions / Corporates :
i.
(a) Secured by an exclusive charge by way of
hypothecation of specific movable assets being
40,277.57
fixed/current assets relating to hypothecation loans
Total 40,277.57

(Rs. in lacs)

As at December 31, 2009

ii. From Banks :

(a) Secured by hypothecation of vehicles 4.01
(b) Secured by an exclusive charge by way of hypothecation
of specific movable assets being fixed / current assets 971,309.19
relating to hypothecation loans*
(c) Secured by an exclusive charge by way of
hypothecation of specific immovable/ movable assets 1,244.28
pertaining to the bio mass plant.
Total 972,557.48

*includes Rs. 51,000.00 lacs the charge in respect of which has since been created.
c) Cash Credit from Banks

As at December 31, 2009

Cash Credit from banks *348,910.53

Secured by hypothecation of specific assets covered under hypothecation loan agreements.

*includes Rs. 20,000 lacs the charge in respect of which has since been created.

2. Subordinated Debt
The Company has raised Tier II capital by issue of subordinated debt bonds amounting to Rs.
37,898.14 Lacs with coupon rate of 10.50% to 13% per annum which are redeemable over a period
of 62 months to 120 months.

3. Final dividend (including tax on dividend) includes an amount of Rs. 380.45 lacs in respect of
dividend paid by the Company for the year ended March 31, 2009 on 81,29,550 equity shares as
these have been allotted before the record date for declaration of dividend for the year ended March
31, 2009, and they rank pari-passu with the existing equity shares for dividend.

F-88
 4. Gratuity and other post-employment benefit plans:

The Company has an unfunded defined benefit gratuity plan. Every employee who has
completed five years or more of service is eligible for a gratuity on separation from service at 15
days salary (last drawn salary) for each completed year of service.

Consequent to the adoption of revised AS 15 ‘Employee Benefits’ issued under Companies

Accounting Standard Rules, 2006, as amended, the following disclosures have been made as
required by the standard:

Profit and Loss account

Net employee benefit expense (recognized in employee cost) (Rs. in lacs)
Gratuity
For the period April 01,
Particulars
2009 to December 31, 2009
Current service cost 107.72
Interest cost on benefit obligation 33.00
Expected return on plan assets NA
(13.35)
Net actuarial (gain) / loss recognised in the period/year

Past service cost Nil

Net benefit expense 127.37

Balance sheet
Details of Provision for gratuity (Rs. in lacs)
Gratuity
Particulars December 31, 2009
Defined benefit obligation 583.83
Fair value of plan assets NA
583.83
Less: Unrecognised past service cost Nil
Plan asset / (liability) (583.83)

F-89
Changes in the present value of the defined benefit obligation are as follows:
(Rs. in lacs)
Gratuity
Particulars December 31, 2009
Opening defined benefit obligation 463.92
Interest cost 33.00
Current service cost 107.72
Benefits paid (7.46)
Actuarial (gains) / losses on obligation (13.35)
583.83
Closing defined benefit obligation

The Company would not contribute any amount to gratuity in 2009-10 as the scheme is unfunded.

The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
Gratuity
Particulars December 31, 2009
%
Investments with insurer NA

The principal assumptions used in determining gratuity obligations for the Company’s plan are shown below:
Gratuity
Particulars December 31, 2009
Discount Rate 7.5%
Increase in compensation cost 5%
Employee Turnover* 5% and 10%

The estimates of future salary increases, considered in actuarial valuation, are on account of inflation, seniority,
promotion and other relevant factors, such as supply and demand in the employment market.

*5% in case of employees with service period of more than 5 years and 10% for all other employees.

Amounts for the current period are as follows:

(Rs. in lacs)
Particulars December 31, 2009
Defined benefit obligation 583.80
Plan assets NA
Surplus / (deficit) (583.80)
Experience adjustments on plan liabilities (27.95)
Experience adjustments on plan assets NA

F-90
5.
For the period April 01, 2009 to December 31, 2009
Particulars
Financing Activities Unallocated reconciling items Total
Segment Revenue
326,620.85 418.49 327,039.34
Segment Results (Profit before tax and after
interest on Financing Segment)

91,282.45 198.96 91,481.41

Less: Interest on unallocated reconciling
items NA 287.14 287.14
Net profit before tax 91,282.45 (88.18) 91,194.27
Less: Income taxes NA NA 30,325.59
Net profit NA NA 60,868.68
As at December 31, 2009
Particulars
Financing Activities Unallocated reconciling items Total
Segment assets 2,855,377.66 1,322.44 2,856,700.10
Unallocated corporate assets 5,779.67
Total Assets
2,855,377.66 1,322.44 2,862,479.77
Segment liabilities 2,555,238.17 1,269.95 2,556,508.12
Unallocated corporate liabilities 7.67
Total Liabilities 2,555,238.17 1,269.95 2,556,515.79
For the period April 01, 2009 to December 31, 2009
Particulars
Financing Activities Unallocated reconciling items Total
Capital expenditure 544.02 0.00 544.02
Depreciation 1,007.26 188.96 1,196.22
Other non - cash expenses 38,000.60 0.94 38,001.54

6. Related Party Disclosures

Related party where control exists

Subsidiaries : Shriram Asset & Equipment Finance Private Limited

(formerly Shriram Equipment Finance Private Ltd.
(SAEFPL)) (from June 04, 2009 upto December 14,
2009)
Shriram Equipment Finance Company Ltd. (SEFCL)
(from December 15, 2009)

Other Related Parties

Enterprises having significant influence Shriram Holdings (Madras) Private Limited
over the Company : Shriram Capital Limited
Newbridge India Investments II Limited

Associates : Shriram Asset Management Company Limited

Key Managerial Personnel : R Sridhar, Managing Director

Relatives of Key Managerial Personnel : Mrs. Padmapriya Sridhar (spouse)

F-91

Payments/Expenses
Employee benefits for
management personnel
Royalty
Data Sourcing fees
Service Charges
Equity dividend
Interest on subordinate debt
Interest on Inter Corporate Deposit
Interest on NCD
Investments in shares
Rent paid
Inter Corporate Deposits
Amount recoverable from SAEFPL
Amount recoverable from SEFCL
Receipts/Income
Inter Corporate Deposit
Sale of investment in shares
Non Convertible Debenture
On conversion of warrants
Rent & electricity reimbursed
(Rs. in lacs)
Enterprises having
Key Management Relatives of Key
significant influence Subsidiaries Associates Total
Personnel Management Personnel
over the Company
Apr 01, 2009 to Dec Apr 01, 2009 to Dec Apr 01, 2009 to Dec Apr 01, 2009 to Dec 31, Apr 01, 2009 to Dec 31, 2009 Apr 01, 2009 to Dec 31,
31, 2009 31, 2009 31, 2009 2009 2009
key
- - - 41.36 - 41.36
901.81* - - - - 901.81
20.89* - - - - 20.89
125.34* - - - - 125.34
5,602.29# - - 5.58 2.43 5,610.30
- - 40.27 - - 40.27
96.66 - - - - 96.66
- - - 0.26 - 0.26
- 214.99 +& - - - 214.99 +&
44.67* - - - - 44.67
4,200.00 - - - - 4,200.00
- 3.54 + - - - 3.54 +
- 2.64 & - - - 2.64 &
- - - - - -
5.00 + 5.00 +
- - 26.00 1.00 27.00
2,400.00 - - - - 2,400.00
- - 4.05 - - 4.05
F-92

Balance outstanding at the
period/year end
Share capital
Share warrants
Non Convertible Debenture
Investments in shares
Outstanding expenses
Employee benefits for
management personnel
Inter Corporate Deposits
Rent Deposit given
Amount recoverable from SAEFPL
Amount recoverable from SEFCL
Interest payable on NCD
Interest payable on ICD
Subordinated debts
Interest payable on subordinate debt
(Rs in Lacs)
Enterprises having
Key Management Relatives of Key
significant influence Subsidiaries Associates Total
Personnel Management Personnel
over the Company
Dec 2009 Dec 2009 Dec 2009 Dec 2009 Dec 2009 Dec 2009
9,337.15# - - 11.02 4.05 9,352.22
- - - - - -
- - - - - -
- 209.99 & 240.00 - - 449.99
170.40* - - - - 170.40
key
- - - - - -
- - - - - -
49.00* - - - - 49.00
- 3.54 + - - - 3.54 +
- 2.64 & - - - 2.64 &
- - - - - -
- - - - - -
- - 413.40 - - 413.40
- - 77.10 - - 77.10
F-93
* Denotes transactions with Shriram Capital Limited

# Denotes transactions with Shriram Holdings (Madras) Private Limited

+ Denotes transactions with Shriram Asset and Equipment Finance Private Limited (SAEFPL)

& Denotes transactions with Shriram Equipment Finance Company Limited

7. Leases
In case of assets given on lease
The Company has given land and building on operating lease for period ranging 11 months to 60
months. During the period, the company had also given its biomass plant on operating lease for the
period 1st April, 2009 to 30th September, 2009. The same was sold on October 1, 2009, hence gross
carrying cost of and accumulated depreciation of the asset as on the date of balance sheet is nil.

In case of assets taken on lease

The Company has taken various office premises, furniture and fixtures, computers and plant and
machinery under operating lease. The lease payments recognized in the profit & loss account are
Rs. 2,598.20 lacs). Certain agreements provide for cancellation by either party and certain
agreements contains clause for escalation and renewal of agreements. . The non-cancellable
operating lease agreements are ranging for a period 22 to 120 months. There are no restrictions
imposed by lease arrangements. There are no sub leases.
The future minimum lease payments in respect of non-cancellable operating lease as at the balance
sheet date are summarized below :
(Rs. in lacs)
As at December 31, 2009

Minimum Lease Payments:

Not later than one year 1,040.25
Later than one year but not later than five years 406.05
Later than five years 59.98

8. In accordance with the Reserve Bank of India circular no.RBI/2006-07/ 225 DNBS (PD) C.C No.
87/03.02.004/2006-07 dated January 4, 2007, the Company has created a floating charge on the
statutory liquid assets comprising of investment in Government Securities to the extent of Rs.
3,053.81 lacs in favour of trustees representing the public deposit holders of the Company.

F-94
9. Earnings per share

Particulars For the period April 01, 2009

to December 31, 2009
Net Profit after tax as per profit and loss account (Rs. in lacs) (A) 60,868.68
Weighted average number of equity shares for calculating Basic EPS (in
2,097.17
lacs) (B)
Weighted average number of equity shares for calculating Diluted EPS
2,115.97
(in lacs) (C)
Basic earnings per equity share (in Rupees) (Face value of Rs. 10/- per
29.02
share) (A) / (B)
Diluted earnings per equity share (in Rupees) (Face value of Rs. 10/- per
28.77
share) (A) / (C)

Particulars For the period April 01, 2009

to December 31, 2009
Weighted average number of equity shares for calculating EPS (in lacs) 2,097.17
Add : Equity shares arising on conversion of optionally convertible
0.00
warrants (in lacs)
Add : Equity shares for no consideration arising on grant of stock options 18.80
under ESOP (in lacs)
Weighted average number of equity shares in calculation diluted EPS (in
lacs) 2,115.97

10. Deferred Tax Liabilities/(Asset)(Net)

(Rs.in lacs)

The break up of deferred tax asset / liabilities is as under:-

As at December 31, 2009

Deferred Tax Liabilities

Timing difference on account of :

Differences in depreciation in block of fixed assets as per tax
Nil
books and financial books
Debenture Issue Expenses 1,204.34
Gross Deferred Tax Liabilities (A) 1,204.34
Deferred Tax Asset
Timing difference on account of :
Differences in depreciation in block of fixed assets as per tax
220.31
books and financial books
Expenses disallowed under Income Tax Act, 1961 3,237.53
Provision for securitization 3,151.00
Gross Deferred Tax Assets (B) 6,608.84

Deferred Tax Liabilities /(Assets)(Net) (A-B) (5,404.50)

F-95
 (Rs.in lacs)
As at December 31, 2009
11. Contingent Liabilities not provided for

a. Disputed income tax/interest tax demand contested in appeals 164.76

not provided for
[Against the above, a sum of Rs. 29.66 lacs has been paid under
protest]
b. Demands in respect of Service tax 312.00
[Amount of Rs.15.00 lacs has been paid under protest ]

c. Income Tax penalty u/s 271(1)(c ) 349.86

d. Guarantees issued by the Company and outstanding 700.00

Future cash outflows in respect of (a) and (b) above are determinable only on receipt of
judgements /decisions pending with various forums/authorities.

Recovery of service tax on lease and hire purchase transactions is kept in abeyance in view of the
12.
stay granted by Honourable Madras High Court. If any liability arises it will be recovered from the
concerned parties. However, on contracts that are terminated, pending decision from the
Honourable Madras High Court, equivalent service tax is written off. The company has recognized
the deferred tax asset on the amounts so written off, as in either case service tax liability will be
paid off or reversed as income.

13. Employee Stock Option Plan

Series I Series II Series III Series IV Series V Series VI
Date of grant October April 1, October 9, August 17, July May 13,
31, 2005 2006 2006 2007 15,2008 2009
Date of May 13,
October February September August 17, July
Board/committe 2009
19, 2005 22, 2006 6, 2006 2007 15,2008
e Approval
Date of October 13,
October October October October 13, October
Shareholder’s 2005
13, 2005 13, 2005 13, 2005 2005 13, 2005
approval
Number of 109,000
2,962,500 832,500 910,000 77,000 50,000
options granted
Method of
Equity
Settlement Equity Equity Equity Equity Equity
(Cash/Equity)
Graded Vesting Period
After 1 year of 10% of 10% of 10% of 10% of 10% of 10% of options
grant date options options options options options granted
granted granted granted granted granted
After 2 years of 20% of 20% of 20% of 20% of 20% of 20% of options
grant date options options options options options granted
granted granted granted granted granted
After 3 years of 30% of 30% of 30% of 30% of 30% of 30% of options
grant date options options options options options granted
granted granted granted granted granted

F-96
 After 4 years of 40% of 40% of 40% of 40% of 40% of 40% of options
grant date options options options options options granted
granted granted granted granted granted
Exercisable 10 years 10 years 10 years 10 years 10 years 10 years from
period from from from from from vesting date
vesting vesting vesting vesting vesting
date date date date date
Vesting On achievement of predetermined targets.
Conditions

The details of Series I have been summarized below:

As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period 1,839,800 Rs. 35.00
Add: Granted during the period - -
Less: Forfeited during the period - -
Less: Exercised during the period 797,850 Rs.35.00
Less: Expired during the period 3,500 -
Outstanding at the end of the period 1,038,450 Rs.35.00
Exercisable at the end of the period 130,215
Weighted average remaining contractual life 8.34
(in years)
Weighted average fair value of options granted Rs.59.04

The details of Series II have been summarized below:

As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period 516,500 Rs.35.00
Add: Granted during the period - -
Less: Forfeited during the period - -
Less: Exercised during the period 265,200 Rs.35.00
Less: Expired during the period
Outstanding at the end of the period 251,300 Rs.35.00
Exercisable at the end of the period 25,250
Weighted average remaining contractual life 8.74
(in years)
Weighted average fair value of options granted Rs.91.75

F-97
The details of Series III have been summarized below:
As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period 7,63,600 Rs.35.00
Add: Granted during the period - -
Less: Forfeited during the period - -
Less: Exercised during the period 183,500 Rs.35.00
Less: Expired during the period
Outstanding at the end of the period 580,100 Rs.35.00
Exercisable at the end of the period 18,000
Weighted average remaining contractual life 9.26
(in years)
Weighted average fair value of options granted Rs.74.85

The details of Series IV have been summarized below:

As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period 106,000 Rs.35.00
Add: Granted during the period - -
Less: Forfeited during the period - -
Less: Exercised during the period 8,700 Rs.35.00
Less: Expired during the period -
Outstanding at the end of the period 97,300 Rs.35.00
Exercisable at the end of the period 1,900
Weighted average remaining contractual life 10.13
(in years)
Weighted average fair value of options granted 136.40

The details of Series V have been summarized below:

As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period 77,000 Rs.35.00
Add: Granted during the period -
Less: Forfeited during the period -
Less: Exercised during the period 7,700 Rs.35.00
Less: Expired during the period -
Outstanding at the end of the period 69,300 Rs.35.00
Exercisable at the end of the period -
Weighted average remaining contractual life 11.03
(in years)
Weighted average fair value of options 253.90
granted

F-98
 The details of Series VI have been summarized below:
As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period -
Add: Granted during the period 50,000 Rs.35.00
Less: Forfeited during the period -
Less: Exercised during the period -
Less: Expired during the period -
Outstanding at the end of the period 50,000 Rs.35.00
Exercisable at the end of the period -
Weighted average remaining contractual life 11.85
(in years)
Weighted average fair value of options 201.45
granted

The weighted average share price for the period over which stock options were exercised was Rs.318.67

The details of exercise price for stock options outstanding at the end of the period are:
December 31, 2009

Series Range of Number of Weighted average Weighted

exercise prices options remaining average exercise
outstanding contractual life of price
options (in years)
Series I Rs.35/- 1,043,750 8.34 Rs.35/-
Series II Rs.35/- 251,300 8.74 Rs.35/-
Series III Rs.35/- 580,100 9.26 Rs.35/-
Series IV Rs.35/- 92,000 10.13 Rs.35/-
Series V Rs.35/- 69,300 11.03 Rs.35/-
Series VI Rs.35/- 50,000 11.85 Rs.35/-

Stock Options granted

Series I:

The weighted average fair value of stock options granted was Rs.59.04. The Black Scholes model has
been used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 38.44 38.44 38.44 38.44
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 5.98 6.33 6.54 6.73
Expected dividend rate (%) 2.31 2.31 2.31 2.31

F-99
Series II :

The weighted average fair value of stock options granted was Rs.91.75. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 19.89 19.89 19.89 19.89
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.64 6.83 6.93 7.26
Expected dividend rate (%) 2.52 2.52 2.52 2.52

Series III :

The weighted average fair value of stock options granted was Rs.74.85. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 31.85 31.85 31.85 31.85
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.96 7.10 7.26 7.40
Expected dividend rate (%) 2.52 2.52 2.52 2.52

Series IV :

The weighted average fair value of stock options granted was Rs. 136.40. The Black Scholes model has
been used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 41.51 41.51 41.51 41.51
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 7.68 7.76 7.82 7.87
Expected dividend rate (%) 0.89 0.89 0.89 0.89

F-100
Series V :

The weighted average fair value of stock options granted was Rs. 253.90. The Black Scholes model has
been used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 69.22 69.22 69.22 69.22
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 9.41 9.36 9.34 9.36
Expected dividend rate (%) 1.63 1.63 1.63 1.63

Series VI :

The weighted average fair value of stock options granted was Rs. 201.45. The Black Scholes model has
been used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 64.80 64.80 64.80 64.80
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 5.00 5.00 5.00 5.00
Average risk-free interest rate (%) 4.03 4.68 5.20 5.64
Expected dividend rate (%) 1.96 1.96 1.96 1.96

The expected volatility was determined based on historical volatility data equal to the NSE volatility rate of
Bank Nifty which is considered as a comparable peer group of the Company. To allow for the effects of
early exercise, it was assumed that the employees will exercise the options within six months from the date
of vesting in view of the exercise price being significantly lower than the market price.

Effect of the employee share-based payment plans on the profit and loss account and on its financial
position:

(Rs. in lacs)
As at December 31, 2009
Total compensation cost pertaining to employee share-based payment plan 292.00
(entirely equity settled)
Liability for employee stock options outstanding as at year end 1,754.33
Deferred compensation cost 256.40
*Pertains to the period nine months ending December 31, 2009

Since the enterprise used the intrinsic value method the impact on the reported net profit and
earnings per share by applying the fair value based method is as follows:

F-101
In March 2005, ICAI has issued a guidance note on “Accounting for Employees Share Based Payments”
applicable to employee based share plan the grant date in respect of which falls on or after April 1, 2005.
The said guidance note requires that the proforma disclosures of the impact of the fair value method of
accounting of employee stock compensation accounting in the financial statements. Applying the fair value
based method defined in the said guidance note, the impact on the reported net profit and earnings per
share would be as follows:

For the period April 01,

2009 to December 31, 2009
Profit as reported (Rs. in lacs) 60,868.68
Add: Employee stock compensation under intrinsic value method (Rs. in lacs) 292.00
Less: Employee stock compensation under fair value method (Rs. in lacs) 294.65
Proforma profit (Rs. in lacs) 60,866.03
Earnings per share
Basic (Rs.)
- As reported 29.02
- Proforma 29.02
Diluted (Rs.)
- As reported 28.77
- Proforma 28.77
Nominal Value Rs 10.00

The Company has converted 8,000,000 warrants issued to Shriram Holdings (Madras) Private
14.
Limited into equity shares at a premium of Rs. 290/- during the period.

15. Securitisation / Direct assignment

The Company sells loans through securitisation and direct assignment. The information on
securitization / direct assignment activity of the Company as an originator is given below:

For the period April 01,

2009 to December 31, 2009
Total number of loan assets securitized 140,532
Total book value of loan assets securitised (Rs. in lacs) 326,229.88
Sale consideration received for the securitised assets (Rs. in lacs) 372,295.43
Gain on account of securitization* (Rs. in lacs) 79,562.73
* Gain on securitization / direct assignment deals done after February 1, 2006 is amortised over the
period of the loan.

The information on securitisation / direct assignment activity of the Company as an originator as on

December 31, 2009 is given in the table below :
(Rs.in lacs)
As at December 31, 2009
Outstanding credit enhancement
-Fixed Deposit 152,736.05
Outstanding liquidity facility
-Fixed Deposit 25,976.51
Outstanding subordinate contribution 3,145.49

F-102
16. Supplementary Statutory Information
(Rs. in lacs)
I Managing Director’s Remuneration
For the period April 01,
2009 to December 31,
2009
Salaries 21.16
Perquisites 4.70
Contribution to Provident fund 0.07
Employee stock option scheme 15.43
41.36
Note: - As the liabilities for gratuity and leave encashment are provided on an actuarial basis for the
Company as a whole, the amounts pertaining to the Managing Director is not included above
The computation of profits under section 349 of the Act has not been given as no commission is
payable to the Directors / Managing Director.

(Rs. in lacs)
II Expenditure in foreign currency (On cash basis)
For the period April 01,
2009 to December 31,
2009
Travelling 2.95
Others 2.62
5.57

17 Based on the intimation received by the Company, none of the suppliers have confirmed to be
registered under “The Micro, Small and Medium Enterprises Development (‘MSMED’) Act,
2006”. Accordingly, no disclosures relating to amounts unpaid as at the Nine months ended
together with interest paid /payable are required to be furnished.

18. During the period, the Company sold its entire investment in the wholly owned subsidiary, Shriram
Asset and Equipment Finance Private Limited (SAEFPL), which was incorporated on June 22,
2009. Further, the Company incorporated a wholly owned subsidiary, Shriram Equipment Finance
Company Limited (SEFCL). SEFCL has still not commenced its operation.
19. Previous Period/year Comparatives
The figures for the previous period/year have been regrouped and reclassified, wherever necessary
to conform to current period’s classification.

F-103
Notes to Accounts for the year 2008 – 2009
1. Secured Loans

a) (i) Privately placed Redeemable Non-convertible Debentures of Rs.1,000/- each

As at March 31, As at March

2009 31, 2008
Number 19,697,934 15,165,476
Amount Rs in Lacs 196,979.34 151,654.76

Secured by equitable mortgage of title deeds of immovable property. Further secured by charge on plant
and machinery, furniture and other fixed assets of the Company, charge on Company’s book debts,
leased assets, loans, advances and other investments of the Company subject to prior charges created
or to be created in favour of the Company’s bankers, financial institutions and others.

Debentures are redeemable at par over a period of 12 months to 160 months from the date of
allotment depending on the terms of the agreement.

(ii) Privately Placed Redeemable Non-Convertible Debenture of Rs.1,000,000/- each

Date of Amount (Rs. in lacs) Redeemable at

Allotment/renewal As at March 31, 2009 As at March 31, 2008 par on
14.12.2006 - 5,000.00 18.04.2008
18.01.2007 - 11,000.00 18.07.2008
21.06.2007 - 2,500.00 19.12.2008
27.06.2007 - 2,500.00 27.02.2009
27.06.2007 - 2,500.00 26.12.2008
04.07.2007 5,000.00 5,000.00 04.07.2009
05.07.2007 15,000.00 5000
15,000.00 05.07.2010
09.07.2007 7,000.00 7,000.00 09.07.2010
11.07.2007 1,000.00 1,000.00 09.07.2010
17.07.2007 10,000.00 15,000.00 17.07.2009
25.07.2007 15,000.00 15,000.00 25.07.2010
30.07.2007 2,500.00 2,500.00 30.07.2009
28.08.2007 2,500.00 2,500.00 28.04.2009
07.09.2007 4,000.00 4,000.00 04.09.2009
10.09.2007 2,500.00 2,500.00 10.09.2010
13.09.2007 1,000.00 1,000.00 13.09.2009
13.09.2007 - 3,400.00 19.09.2008

F-104
 Date of Amount (Rs. in lacs) Redeemable at
Allotment/renewal par on
As at March 31, 2009 As at March 31, 2008

17.09.2007 - 3,800.00 17.09.2010

21.09.2007 2,500.00 2,500.00 21.09.2010
05.10.2007 2,000.00 2,000.00 05.10.2009
*05.10.2007 1,500.00 1,500.00 05.10.2010
09.10.2007 2,500.00 2,500.00 09.10.2009
12.10.2007 2,500.00 2,500.00 28.09.2009
15.10.2007 2,000.00 2,000.00 15.10.2010
18.10.2007 12,000.00 12,000.00 18.10.2010
19.10.2007 5,000.00 5,000.00 19.10.2010
19.10.2007 8,000.00 8,000.00 18.10.2009
22.10.2007 2,500.00 2,500.00 22.10.2009
30.10.2007 5,000.00 5,000.00 30.10.2009
02.05.2008 15,000.00 - 02.05.2011
20.06.2008 00.00
10,000.00 - 20.06.2011
18.08.2008 29,000.00 - 06.03.2010
04.09.2008 3,500.00 - 04.04.2010
04.09.2008 1,500.00 - 20.02.2010
04.09.2008 10,000.00 - 04.09.2010
05.09.2008 7,500.00 - 10.09.2010
08.09.2008 3,000.00 - 08.09.2010
15.09.2008 1,500.00 - 15.09.2011
15.09.2008 1,500.00 - 15.09.2010

15.09.2008 2,500.00 - 15.03.2010

15.09.2008 2,500.00 - 15.09.2010
15.09.2008 2,500.00 - 15.03.2010
15.09.2008 1,500.00 - 30.04.2010
16.09.2008 2,500.00 - 16.09.2011
17.09.2008 8,000.00 - 01.09.2011
24.09.2008 2,500.00 - 24.09.2010
26.09.2008 2,500.00 - 26.09.2010
26.09.2008 1,500.00 - 10.09.2010
08.10.2008 1,200.00 - 06.04.2010
24.10.2008 00
5,000.00 - 10.12.2010
27.10.2008 30,000.00 - 27.10.2013
26.11.2008 1,000.00 - 26.11.2013
17.12.2008 19,000.00 - 17.12.2009
24.03.2009 2,400.00 - 24.03.2010

F-105
 Amount (Rs. in lacs)
Date of Redeemable at par on Redeemable at
Allotment/renewal par on
As at March 31, 2009 As at March 31, 2008
25.03.2009 2,600.00 - 25.03.2010
28.03.2009 5,000.00 - 28.03.2012
TOTAL 2,85,700.00 146,700.00

Secured by hypothecation of specific assets covered under loan agreements and equitable mortgage of
title deeds of immovable property.
*Put/call option on April 3, 2009

(iii) Privately Placed Redeemable Non-Convertible Debenture of Rs.1,000/- each

Amount (Rs. in lacs)
Date of Redeemable
Allotment/renewal As at March 31, 2009 As at March 31, 2008 at par on

18.01.2007 - 0.44 18.01.2009

07.06.2007 - 2,500.00 06.05.2008
20.06.2007 - 500.00 18.06.2008
22.06.2007 - 2,500.00 23.06.2008
07.08.2007 - 5,000.00 30.07.2009
21.09.2007 - 3,400.00 19.09.2008
TOTAL - 13,900.44

Secured by equitable mortgage of title deeds of immovable property. Further secured by charge on
plant and machinery, furniture and other fixed assets of the Company, charge on Company’s book
debts, leased assets, loans, advances and other investments of the Company subject to prior charges
created or to be created in favour of the Company’s bankers, financial institutions and others.

b) Term Loans :

(Rs. in lacs)
As at March 31, As at March 31,
2009 2008
i. From Financial Institutions / Corporates :
(a) Secured by an exclusive charge by way of
hypothecation of specific movable assets 41,893.90 106,342.57
being fixed/current assets relating to
hypothecation loans
(b) Secured by an exclusive charge by way of
hypothecation of specific immovable/ 1,420.12 1,785.36
movable assets pertaining to the wind farm
(c) Secured by an exclusive charge by way of
hypothecation of specific immovable/ 754.40 963.00
movable assets pertaining to the wind farm
and guaranteed by a former Director.

F-106
 As at March 31, As at March 31,
2009 2008
ii. From Foreign Institution:
Secured by an exclusive charge by way of Hypothecation
of specific Loan agreements and all amounts owing to and 724.27 2,172.80
received by the Company pursuant to the above
Agreements
Total 44,792.69 111,263.73

(Rs. in lacs)
As at March 31, As at March 31,
2009 2008

iii. From Banks :

(a) Secured by hypothecation of vehicles 6.36 10.07
(b) Secured by an exclusive charge by way of
hypothecation of specific movable assets *830,676.33 *502,000.38
being fixed / current assets relating to
lease, hypothecation loans
(c) Secured by an exclusive charge by way of
hypothecation of specific immovable/ 969.99 1,202.27
movable assets pertaining to the wind farm

(d) Secured by an exclusive charge by way of

hypothecation of specific immovable/ 1,710.90 2,116.56
movable assets pertaining to the bio mass
plant.
Total 833,363.58 505,329.28

*includes Rs.7,500.00 lacs (March 31, 2008 : Rs 17,065.00 lacs) the charge in respect of which has
since been created.

c) Cash Credit from Banks

(Rs. in lacs)
As at March 31, As at March 31,
2009 2008
Cash Credit from Banks *316,623.70 *225,646.66
Secured by hypothecation of specific assets covered under Loan Agreements and Book debts.
* includes Nil (March 31, 2008 : Rs 31,500.00 lacs) the charge in respect of which has since been created.

2. Subordinated Debt
The Company has raised Tier II capital by issue of subordinated debt bonds amounting to Rs.
60,553.56 lacs (March 31, 2008: Rs. 30,516.38 lacs) with coupon rate of 11.50% to 13% per
annum which are redeemable over a period of 62 months to 121 months.

F-107
 3. Cash & Cash Equivalents
(Rs. in lacs)
Particulars Year ended March Year ended March
31, 2009 31, 2008
Cash & Bank balance 578,489.69 137,420.45
Less : Fixed deposits having original maturity
greater than 3 months or pledged with banks or lien 117,435.43 70,221.15
marked deposits
Balance considered as cash & cash equivalents for
461,054.26 67,199.30
cash flow statement

4. Gratuity and other post-employment benefit plans:

The Company has an unfunded defined benefit gratuity plan. Every employee who has
completed five years or more of service is eligible for a gratuity on separation at 15 days salary
(last drawn salary) for each completed year of service.

Consequent to the adoption of revised AS 15 ‘Employee Benefits’ issued under Companies

(Accounting Standards) Amendment Rules, 2008, the following disclosures have been made as
required by the standard:

Profit and Loss account

Net employee benefit expense (recognized in employee cost) (Rs. in lacs)
Gratuity
Particulars March 31, 2009 March 31, 2008
Current service cost 99.69 53.25
Interest cost on benefit obligation 33.23 17.24
Expected return on plan assets NA NA
Net actuarial (gain) / loss recognised in the year 22.48 101.94
Past service cost Nil Nil
Net benefit expense 155.40 172.43
Actual return on plan assets NA NA

Balance sheet
Details of Provision for gratuity (Rs. in lacs)
Gratuity
Particulars March 31, 2009 March 31, 2008
Defined benefit obligation 463.92 322.76
Fair value of plan assets NA NA
463.92 322.76
Less: Unrecognised past service cost Nil Nil
Plan asset / (liability) (463.92) (322.76)

F-108
Changes in the present value of the defined benefit obligation are as follows:
(Rs. in lacs)
Gratuity
Particulars March 31, 2009 March 31, 2008
Opening defined benefit obligation 322.76 174.31
Interest cost 33.23 17.24
Current service cost 99.69 53.25
Benefits paid (14.24) (23.98)
Actuarial (gains) / losses on obligation 22.48 101.94
Closing defined benefit obligation 463.92 322.76

The Company would not contribute any amount to gratuity in 2009-10 as the scheme is unfunded.

The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
Gratuity
Particulars March 31, 2009 March 31, 2008
% %
Investments with insurer NA NA

The principal assumptions used in determining gratuity obligations for the Company’s plan are shown
below :
Gratuity
Particulars March 31, 2009 March 31, 2008
Discount Rate 7.75% 8%
Increase in compensation cost 5% 5%
Employee Turnover* 5% and 10% 5% and 10%

The estimates of future salary increases, considered in actuarial valuation, take account of inflation,
seniority, promotion and other relevant factors, such as supply and demand in the employment market.

*5% in case of employees with service period of more than 5 years and 10% for all other employees.

Amounts for the current period are as follows: (Rs. in lacs)

Particulars March 31, 2009 March 31, 2008
Defined benefit obligation 463.92 322.76
Plan assets NA NA
Surplus / (deficit) (463.92) (322.76)
Experience adjustments on plan liabilities 37.57 101.94
Experience adjustments on plan assets NA NA

F-109
5. The Company is a primarily engaged in financing activities. It operates in a single business and
geographical segment. The Company also owns windmills and biomass which generate income from sale
of electricity and the same has been classified as ‘Unallocated reconciling item’ as per requirements of AS
– 17 on ‘Segment Reporting’ issued by ICAI.
(Rs. in lacs)
Year ended March 31, 2009 Year ended March 31, 2008
Unallocated Unallocated
Particulars Financing Financing
reconciling Total reconciling Total
Activities Activities
items items
Segment Revenue 369,847.71 3,265.26 373,112.97 249,612.56 1,290.12 250,902.68
Segment Results
(Profit before tax
92,842.16 (183.61) 92,658.55 62,225.82 (956.50) 61,269.32
and after interest on
Financing Segment)
Less: Interest on
unallocated N.A. 595.44 595.44 N.A. 686.02 686.02
reconciling items
Net profit before
92,842.16 (779.05) 92,063.11 62,225.82 (1,642.52) 60,583.30
tax
Less: Income taxes N.A. N.A. 30,822.90 N.A. N.A. 21,600.65
Net profit N.A. N.A. 61,240.21 N.A. N.A. 38,982.65
Other Information:
Segment assets 2,486,282.78 9,673.31 2,495,956.09 1,813,703.73 10,785.10 1,824,488.83
Unallocated
3,017.14 2,372.02
corporate assets
Total Assets 2,486,282.78 9,673.31 2,498,973.23 1,813,703.73 10,785.10 1,826,860.85
Segment liabilities 2,261,942.11 5,352.41 2,267,294.52 1,635,520.68 6,089.70 1,641,610.38
Unallocated
15.11 3,614.57
corporate liabilities
Total Liabilities 2,261,942.11 5,352.41 2,267,309.63 1,635,520.68 6,089.70 1,645,224.95
Capital expenditure 3,369.47 Nil 3,369.47 1,266.01 Nil 1,266.01
Depreciation 1,645.69 1,834.90 3,480.59 1,884.86 1,821.11 3,705.97
Other non - cash
33,145.16 590.85 33,736.01 29,713.13 13.73 29,726.86
expenses

F-110
6. Related Party Disclosures

Related party where control exists

Subsidiaries : Shriram Powergen Limited (upto March 27, 2008)

Other Related Parties

Enterprises having significant influence Shriram Holdings (Madras) Private Limited

over the Company : Shriram Capital Limited
Newbridge India Investments II Limited

Associates : Shriram Asset Management Company Limited

Ashley Transport Services Limited (upto July 3, 2007)

Key Managerial Personnel : R Sridhar, Managing Director

Relatives of Key Managerial Personnel : Mrs. Padmapriya Sridhar (spouse)

F-111
 (Rs. In Lacs)
Enterprises having Relatives of Key
Key Management
significant influence over Subsidiaries Associates Management Total
Personnel
the Company Personnel
2009 2008 2009 2008 2009 2008 2009 2008 2009 2008 2009 2008
Payments/Expenses
Employee benefits for key
- - - - - - 62.99 66.53 - - 62.99 66.53
management personnel
Royalty 1,036.45* 623.54* - - - - - - - - 1,036.45 623.54
Data Sourcing fees 87.35* 57.95* - - - - - - - - 87.35 57.95
Service Charges 524.10* 347.70* - - - - - - - - 524.10 347.70
Equity dividend 4,268.58# 2,561.15# - - - - 4.29 2.52 2.03 1.22 4,274.90 2,564.89
Interest on subordinate debt - - - - 51.19^ 101.94^ - - - - 51.19 101.94
Interest on Inter Corporate Deposit 149.52# - - - - - - - - - 149.52 -
Investments in shares - - - - 30.00@ - - - - - 30.00
Rent paid 57.60* 58.80* - - - - - - - - 57.60 58.80
Receipts/Income
Sale of investments - - - 4.99 - 112.50@ - - - - - 117.49
Subscription of equity shares - 6,955.20# - - - - - - - - - 6,955.20
Subscription to optionally
- 2,400.00# - - - - - - - - - 2,400.00
convertible warrants
Inter Corporate Deposit 4,200# - - - - - - - - - 4,200.00 -
Rent & electricity - - - - 5.40^ 5.40^ - - - - 5.40 5.40
Balance outstanding at the year end
Share capital 8,537.15# 8,537.15# - - - - 8.58 8.40 4.05 4.05 8,549.78 8,549.60
Share warrants 2,400.00# 2,400.00# - - - - - - - - 2,400.00 2,400.00
Investments in shares - - - - 240.00^ 240.00^ - - - - 240.00 240.00
Outstanding expenses 67.17* 62.18* - - - - - 30.00 - - 67.17 92.18
Inter Corporate Deposits 4,200.00# - - - - - - - - 4,200.00 -
Rent Deposit given 49.00* 49.00* - - - - - - - - 49.00 49.00
Interest payable on ICD 149.52# - - - - - - - - 149.52 -
Interest payable on subordinate debt - - - - 29.36^ 233.22^ - - - - 29.36 233.22

F-112
* Denotes transactions with Shriram Capital Limited

# Denotes transactions with Shriram Holdings (Madras) Private Limited

^ Denotes transactions with Shriram Asset Management Company Limited

@ Denotes transactions with Ashley Transport Services Limited

7. Leases
In case of assets given on operating lease
The Company has given land and building on operating lease for period ranging 11 months to 60
months.
In case of assets given on financial lease

The Company has given vehicles on finance lease. The lease term is for 3 to 5 years. There is no
escalation clause in the lease agreement. There are no restrictions imposed by lease arrangements.

(Rs. in lacs)
As at March 31, As at March 31,
2009 2008
Total gross investment in the lease - 6,539.13
Less : Unearned finance income - 800.06
Less: Unguaranteed residual value - -
Present value of minimum lease payments - 5,739.07
Gross investment in the lease for the period :
Not later than one year [Present value of minimum - 6,164.18
lease payments receivable Rs. Nil as on March 31,
2009 (March 31, 2008: Rs.5,388.35 lacs)]
Later than one year but not later than five years - 374.95
[Present value of minimum lease payments Rs. Nil
as on March 31, 2009 (March 31, 2008 : Rs. 350.72
lacs)]
Later than five years [Present value of minimum - -
lease payments Nil as on March 31, 2009 (March
31, 2008: Nil)]

In case of assets taken on lease

The Company has taken various office premises, furniture and fixtures, computers and plant and
machinery under operating lease. The lease payments recognized in the profit & loss account are
Rs.2,636.98 lacs (March 31, 2008: Rs.1,475.33 lacs). Certain agreements provide for cancellation
by either party and certain agreements contains clause for escalation and renewal of agreements.
There are no sub leases.

F-113
 The future minimum lease payments in respect of non-cancellable operating lease as at the balance
sheet date are summarized below :
(Rs. in lacs)
Year ended March Year ended
31, 2009 March 31, 2008

Minimum Lease Payments:

Not later than one year 408.16 334.18
Later than one year but not later than five years 149.80 468.61
Later than five years Nil Nil

8. In accordance with the Reserve Bank of India circular no.RBI/2006-07/ 225 DNBS (PD) C.C No.
87/03.02.004/2006-07 dated January 4, 2007, the Company has created a floating charge on the
statutory liquid assets comprising of investment in Government Securities to the extent of
Rs.283.00 lacs (March 31, 2008: Rs. 427.44 lacs) in favour of trustees representing the public
deposit holders of the Company.

9. Earnings per share

Year ended March Year ended March

Particulars
31, 2009 31, 2008
Net Profit after tax as per profit and loss account (Rs. in
61,240.21 38,982.65
lacs) (A)
Weighted average number of equity shares for calculating
2,033.80 1,924.01
Basic EPS (in lacs) (B)
Weighted average number of equity shares for calculating
2,138.29 1,977.76
Diluted EPS (in lacs) (C)
Basic earnings per equity share (in Rupees) (Face value of
30.11 20.26
Rs. 10/- per share) (A) / (B)
Diluted earnings per equity share (in Rupees) (Face value
28.64 19.71
of Rs. 10/- per share) (A) / (C)

Year ended March Year ended March

Particulars 31, 2009 31, 2008
Weighted average number of equity shares for calculating
2,033.80 1,924.01
EPS (in lacs)
Add : Equity shares arising on conversion of optionally
80.00 23.83
convertible warrants (in lacs)
Add : Equity shares for no consideration arising on grant of 24.49
29.92
stock options under ESOP (in lacs)
Weighted average number of equity shares in calculation
2,138.29 1,977.76
diluted EPS (in lacs)

F-114
10. Deferred Tax Liabilities/(Assets) (Net) (Rs in Lacs)

The break up of deferred tax asset / liabilities is as As at March 31, As at March 31,
under:- 2009 2008

Deferred Tax Liabilities

Timing difference on account of :

Differences in depreciation in block of fixed assets as
2,482.17 2,755.33
per tax books and financial books
Effect of lease accounting Nil 1,753.86
Gross Deferred Tax Liabilities (A) 2,482.17 4,509.19
Deferred Tax Asset
Timing difference on account of :
Expenses disallowed under Income Tax Act, 1961 3,100.49 173.47
Provision for securitization 2,021.16 503.73
Provision for hedging contracts Nil 239.78
Gross Deferred Tax Assets (B) 5,121.65 916.98

Deferred Tax Liabilities /(Assets)(Net) (A-B) (2,639.48) 3,592.21

(Rs. in lacs)
As at March 31, As at March 31,
11. Capital Commitments
2009 2008
Estimated amount of contracts remaining to be executed
Nil 100.00
on capital account and not provided for (net of advances)

(Rs. in lacs)
As at March 31, As at March 31,
12. Contingent Liabilities not provided for
2009 2008
a. Disputed income tax/interest tax demand contested in 164.76 3,381.70
appeals not provided for
[Against the above, a sum of Rs. 29.66 lacs (March 31,
2008: Rs. 318.11 lacs) has been paid under protest]
b. Demands in respect of Service tax 299.00 284.00
[Amount of Rs.15 lacs (March 31, 2008 : Rs. 15 lacs) has
been paid under protest ]

c. Guarantees issued by the Company and outstanding 901.97 1,991.58

Future cash outflows in respect of (a) and (b) above are determinable only on receipt of
judgements /decisions pending with various forums/authorities.

F-115
13. Recovery of service tax on lease and hire purchase transactions is kept in abeyance in view of the
stay granted by Honourable Madras High Court. If any liability arises it will be recovered from the
concerned parties. However, on contracts that are terminated, pending decision from the
Honourable Madras High Court, equivalent service tax is written off. The company has recognized
the deferred tax asset on the amounts so written off, as in either case service tax liability will be
paid off or reversed as income.

14. Employee Stock Option Plan

Series I Series II Series III Series IV Series V
Date of grant October 31, August 17, July 15,2008
April 1, 2006 October 9, 2006
2005 2007
Date of Board
October 19, February 22, September 6, August 17,
/Committee July 15,2008
2005 2006 2006 2007
Approval
Date of
October 13, October 13, October 13, October 13, October 13,
Shareholder’s
2005 2005 2005 2005 2005
approval
Number of
options 2,962,500 832,500 910,000 109,000 77,000
granted
Method of
Settlement Equity Equity Equity Equity Equity
(Cash/Equity)
Graded Vesting Period
After 1 year of 10% of options 10% of options 10% of options 10% of options 10% of options
grant date granted granted granted granted granted
After 2 years 20% of options 20% of options 20% of options 20% of options 20% of options
of grant date granted granted granted granted granted
After 3 years 30% of options 30% of options 30% of options 30% of options 30% of options
of grant date granted granted granted granted granted
After 4 years 40% of options 40% of options 40% of options 40% of options 40% of options
of grant date granted granted granted granted granted

Exercisable 10 years from 10 years from 10 years from 10 years from 10 years from
period vesting date vesting date vesting date vesting date vesting date
Vesting On achievement of pre-determined targets
Conditions

F-116
The details of Series I have been summarized below:

As at March 31, 2009 As at March 31, 2008

Number of Weighted Number Weighted
Shares Average of Shares Average
Exercise Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 2,177,000 Rs. 35.00 2,492,750 Rs. 35.00
Add: Granted during the year - - - -
Less: Forfeited during the year - - - -
Less: Exercised during the year 304,500 Rs.35.00 57,800 Rs. 35.00
Less: Expired during the year 32,700 - 257,950 -
Outstanding at the end of the year 1,839,800 Rs.35.00 2,177,000 Rs. 35.00
Exercisable at the end of the year 860,540 528,260 -
Weighted average remaining contractual life (in 9.09 10.09
years)
Weighted average fair value of options granted Rs.59.04 Rs. 59.04

The details of Series II have been summarized below:

As at March 31, 2009 As at March 31, 2008
Number of Weighted Number Weighted
Shares Average of Average
Exercise Shares Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 554,100 Rs.35.00 744,000 Rs.35.00
Add: Granted during the year - - - -
Less: Forfeited during the year - - - -
Less: Exercised during the year 31,300 Rs.35.00 18,900 Rs.35.00
Less: Expired during the year 6,300 171,000 -
Outstanding at the end of the year 516,500 Rs.35.00 554,100 Rs.35.00
Exercisable at the end of the year 116,520 38,400
Weighted average remaining contractual life (in 9.49 10.49
years)
Weighted average fair value of options granted Rs.91.75 Rs. 91.75

The details of Series III have been summarized below:

As at March 31, 2009 As at March 31, 2008
Number of Weighted Number Weighted
Shares Average of Average
Exercise Shares Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 811,000 Rs.35.00 885,000 Rs.35.00
Add: Granted during the year - - - -
Less: Forfeited during the year - - - -
Less: Exercised during the year 40,400 Rs.35.00 - -
Less: Expired during the year 7,000 - 74,000 -
Outstanding at the end of the year 763,600 - 811,000 Rs.35.00
Exercisable at the end of the year 202,600 - 81,100 -
Weighted average remaining contractual life (in - 10.01 - 11.01
years)
Weighted average fair value of options granted - Rs.74.85 - Rs.74.85

F-117
 The details of Series IV have been summarized below:
As at March 31, 2009 As at March 31, 2008
Number of Weighted Number Weighted
Shares Average of Average
Exercise Shares Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 109,000 Rs.35.00 - -
Add: Granted during the year - 109,000 Rs.35.00
Less: Forfeited during the year - - -
Less: Exercised during the year - - -
Less: Expired during the year 3,000 - -
Outstanding at the end of the year 106,000 Rs.35.00 109,000 Rs.35.00
Exercisable at the end of the year 106,000 Nil -
Weighted average remaining contractual life (in 10.88 11.88
years)
Weighted average fair value of options granted 136.40 136.40

The details of Series V have been summarized below:

As at March 31, 2009 As at March 31, 2008
Number of Weighted Number Weighted
Shares Average of Average
Exercise Shares Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year - - - -
Add: Granted during the year 77,000 Rs.35.00 - -
Less: Forfeited during the year - - - -
Less: Exercised during the year - - - -
Less: Expired during the year - - - -
Outstanding at the end of the year 77,000 Rs.35.00 - -
Exercisable at the end of the year - - - -
Weighted average remaining contractual life (in 11.78 - -
years)
Weighted average fair value of options granted 253.90 -
The weighted average share price for the period over which stock options were exercised was Rs.242.00
(March 31, 2008: Rs. 270.76)

The details of exercise price for stock options outstanding at the end of the year are:
March 31, 2009

Series Range of Number of Weighted average Weighted

exercise prices options remaining average exercise
outstanding contractual life of price
options (in years)
Series I Rs.35/- 1,839,800 9.09 Rs.35/-
Series II Rs.35/- 516,500 9.49 Rs.35/-
Series III Rs.35/- 763,600 10.01 Rs.35/-
Series IV Rs.35/- 106,000 10.88 Rs.35/-
Series V Rs.35/- 77,000 11.78 Rs.35/-

F-118
 March 31, 2008

Series Range of Number of Weighted average Weighted average

exercise options remaining exercise price
prices outstanding contractual life of
options (in years)
Series I Rs.35/- 2,177,000 10.09 Rs.35/-
Series II Rs.35/- 554,100 10.49 Rs.35/-
Series III Rs.35/- 811,000 11.01 Rs.35/-
Series IV Rs.35/- 109,000 11.88 Rs.35/-

Stock Options granted

Series I:

The weighted average fair value of stock options granted was Rs.59.04. The Black Scholes model has
been used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 38.44 38.44 38.44 38.44
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 5.98 6.33 6.54 6.73
Expected dividend rate (%) 2.31 2.31 2.31 2.31

Series II :

The weighted average fair value of stock options granted was Rs.91.75. The Black Scholes model has
been used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 19.89 19.89 19.89 19.89
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.64 6.83 6.93 7.26
Expected dividend rate (%) 2.52 2.52 2.52 2.52

F-119
Series III :

The weighted average fair value of stock options granted was Rs.74.85. The Black Scholes model has
been used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 31.85 31.85 31.85 31.85
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.96 7.10 7.26 7.40
Expected dividend rate (%) 2.52 2.52 2.52 2.52

Series IV :

The weighted average fair value of stock options granted was Rs. 136.40. The Black Scholes model has
been used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 41.51 41.51 41.51 41.51
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 7.68 7.76 7.82 7.87
Expected dividend rate (%) 0.89 0.89 0.89 0.89

Series V :

The weighted average fair value of stock options granted was Rs. 253.90. The Black Scholes model has
been used for computing the weighted average fair value of options considering the following inputs:
Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 69.22 69.22 69.22 69.22
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 9.41 9.36 9.34 9.36
Expected dividend rate (%) 1.63 1.63 1.63 1.63

The expected volatility was determined based on historical volatility data equal to the NSE volatility rate
of Bank Nifty which is considered as a comparable peer group of the Company. To allow for the effects
of early exercise, it was assumed that the employees will exercise the options within six months from the
date of vesting in view of the exercise price being significantly lower than the market price.

Effect of the employee share-based payment plans on the profit and loss account and on its financial
position:

F-120
 (Rs. in lacs)
As at March As at March
31, 2009 31, 2008
Total compensation cost pertaining to employee share- 580.57 653.95
based payment plan (entirely equity settled)
Liability for employee stock options outstanding as at year 2,584.88 2,689.69
end
Deferred compensation cost 445.98 863.05

Since the enterprise used the intrinsic value method the impact on the reported net profit and
earnings per share by applying the fair value based method is as follows:

In March 2005, ICAI has issued a guidance note on “Accounting for Employees Share Based Payments”
applicable to employee based share plan the grant date in respect of which falls on or after April 1, 2005.
The said guidance note requires that the proforma disclosures of the impact of the fair value method of
accounting of employee stock compensation accounting in the financial statements. Applying the fair
value based method defined in the said guidance note, the impact on the reported net profit and earnings
per share would be as follows:

Year ended Year ended

March 31, 2009 March 31, 2008
Profit as reported (Rs. in lacs) 61,240.21 38,982.65
Add: Employee stock compensation under intrinsic value
580.57 653.95
method (Rs. in lacs)
Less: Employee stock compensation under fair value
553.44 615.95
method (Rs. in lacs)
Proforma profit (Rs. in lacs) 61,267.34 39,020.65
Earnings per share
Basic (Rs.)
- As reported 30.11 20.26
- Proforma 30.12 20.28
Diluted (Rs.)
- As reported 28.64 19.71
- Proforma 28.65 19.73
Nominal value 10.00 10.00

15. Securitisation/ Direct assignment

The Company sells loans through securitisation and direct assignment. The information on
securitisation / direct assignment activity of the Company as an originator for the year March 31, 2009
and March 31, 2008 is given below:

Year ended Year ended

March 31, 2009 March 31, 2008
Total number of loan assets securitized/directly
1,49,860 65,020
assigned
Total book value of loan assets securitized/directly
3,12,498.40 211,822.17
assigned (Rs. in lacs)
Sale consideration received for the securitized/directly
3,38,334.83 248,140.60
assigned assets (Rs. in lacs)
Gain on account of securitization/direct assignment*
41,816.19 36,318.39
(Rs. in lacs)

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* Gain on securitization / direct assignment deals done after February 1, 2006 is amortised over the
period of the loan.

The information on securitisation & direct assignment activity of the Company as an originator as on
March 31, 2009 and March 31, 2008 is given in the table below :
(Rs. in Lacs)
As at March 31, As at March 31,
2009 2008
Outstanding credit enhancement 97,459.32 56,687.05
Outstanding liquidity facility 17,137.30 7,127.85
Outstanding subordinate contribution 3,301.71 5,159.40

16. Derivative Instruments:

The Notional principal amount of derivative transactions outstanding as on March 31, 2009 for
principal swaps are Rs. NIL (March 31, 2008 – Rs.Nil ) and for interest rate swaps Rs.
Nil(March 31, 2008 – Rs 95,000 lacs). The interest rate swaps is to hedge against exposure to
variable interest outflow on loans. The broad term of the instruments are to receive fixed rate of
interest/variable rate equal to INBMK and to pay a variable rate equal to INBMK/MIBOR.

17. Supplementary Statutory Information

(Rs. in lacs)
i Managing Director’s Remuneration
Year ended Year ended
March 31, 2009 March 31, 2008
Salaries 40.00 46.96
Perquisites 8.13 9.78
Contribution to Provident fund 0.09 0.09
Employee stock option scheme 14.77 9.70
62.99 66.53
Note: - As the future liability for gratuity and leave encashment is provided on an actuarial
basis for the Company as a whole, the amount pertaining to the directors is not ascertainable
and, therefore, not included above.
The computation of profits under section 349 of the Act has not been given as no commission
is payable to the Directors / Managing Director.

(Rs. in lacs)
ii Expenditure in foreign currency (On cash basis)
Year ended Year ended
March 31, 2009 March 31, 2008
Travelling 236.38 13.81
Others 3,320.21 Nil
3,556.59 13.81

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iii Net dividend remitted in foreign Year ended March 31, Year ended March 31,
exchange 2009 2008
Period to which it relates Interim Final Interim Final
2008-09 2007-08 2007-08 2006-07
Number of non-resident shareholders 6 6 6 2
Number of equity shares held on which 42,403,023 42,403,023 45,863,023 35,125,801
dividend was due
Amount remitted (state the foreign
currency)
Euro - - - 2,234
American Dollar 840,330 3,966,606 1,154,077 1,683,294

18. Additional information pursuant to the provisions of paragraphs 3, 4C and 4D of Part II of

schedule VI to the Act

i Licensed Capacity, Installed capacity, Actual production and Sales

Class of Units Licensed Installed Capacity Actual Production and Sales Value
Goods Capacity as as at March 31, (in Sales for the year ended
(Rs. in lacs)
at March 31, KW) March 31, (in units)
2009 2008 2009 2008 2009 2008 2009 2008
Electricity- 44 NA NA 22,430 22,430 34,546,664 30,200,617 2,251.19* 966.44
Windmill
Electricity- 1 NA NA 7,500 7,500 32,192,600 10,275,400 1,014.07 323.68
Biomass
*Includes compensation charges received towards generation loss.

ii Consumption of raw materials - indigenous

Raw material Units Quantity for the year Value for the year ended
ended March 31, March 31, (Rs in lacs)
2009 2008 2009 2008
Biomass Fuel Tons 69,354 25,332 687.17 258.06

19. Based on the intimation received by the Company, none of the suppliers have confirmed to be
registered under “The Micro, Small and Medium Enterprises Development (‘MSMED’) Act,
2006”. Accordingly, no disclosures relating to amounts unpaid as at the year end together
with interest paid /payable are required to be furnished.

20. Final dividend (including tax on dividend) includes an amount of Rs 12.31 lacs in respect of
dividend paid by the Company for the previous year on 2,63,100 equity shares allotted before
the date of book closure as they rank pari-passu with the existing equity shares for dividend.

21. The auditors’ report dated May 13, 2009 on financial statements as of and for year ended
March 31, 2009 included, as an Annexure, a statement on certain matters specified in the
Companies (Auditors Report) Order, 2003, which was modified to indicate that there was an
instance of fraud on the Company by its franchisee.
22. Previous Year Comparatives
The figures for the previous year have been regrouped and reclassified, wherever necessary to
conform to current year’s classification.
F-123
Notes to Accounts for the year 2007-2008
1. Secured Loans

a) (i) Privately placed Redeemable Non-convertible Debentures of Rs.1,000/- each

(Rs. in lacs)
As at March 31, As at March
2008 31, 2007
Number 15,165,476 12,379,858
Amount 151,654.76 123,798.58

Secured by exclusive mortgage of office premises. Further secured by charge on Plant and
Machinery, Furniture and other fixed assets of the Company, charge on Company’s book debts,
leased assets, loans, advances and other investments of the Company subject to prior charges created
or to be created in favour of the Company’s bankers, financial institutions and others.

Debentures are redeemable over a period of 12 months to 160 months from the date of allotment
depending on the terms of the agreement.

(ii) Privately Placed Redeemable Non-Convertible Debenture of Rs.1,000,000/- each

Amount (Rs. in lacs)

Date of
As at March 31, As at March 31, Redemption date
Allotment/renewal
2008 2007
05.05.2006 Nil 5,000.00 04.05.2007
23.10.2006 Nil 10,000.00 24.10.2007
12.12.2006 Nil 5,000.00 17.12.2007
14.12.2006 5,000.00 5,000.00 18.04.2008
18.01.2007 11,000.00 11,000.00 18.07.2008
21.06.2007 2,500.00 0.00 19.12.2008
27.06.2007 2,500.00 0.00 27.02.2009
27.06.2007 2,500.00 0.00 26.12.2008
04.07.2007 5,000.00 0.00 04.07.2009
05.07.2007 5000
15,000.00 0.00 05.07.2010
09.07.2007 7,000.00 0.00 09.07.2010
11.07.2007 1,000.00 0.00 09.07.2010
17.07.2007 15,000.00 0.00 17.07.2009
25.07.2007 15,000.00 0.00 25.07.2010
30.07.2007 2,500.00 0.00 30.07.2009
28.08.2007 2,500.00 0.00 28.04.2009
07.09.2007 4,000.00 0.00 04.09.2009
10.09.2007 2,500.00 0.00 10.09.2010
13.09.2007 1,000.00 0.00 13.09.2009
13.09.2007 3,400.00 0.00 19.09.2008
17.09.2007 3,800.00 0.00 17.09.2010
F-124
 Amount (Rs. in lacs)
Date of Redemption date Redemptio
Allotment/renewal As at March 31, As at March 31, n date
2008 2007
21.09.2007 2,500.00 0.00 21.09.2010
05.10.2007 2,000.00 0.00 05.10.2009
05.10.2007 1,500.00 0.00 05.10.2010
09.10.2007 2,500.00 0.00 09.10.2009
12.10.2007 2,500.00 0.00 28.09.2009
15.10.2007 2,000.00 0.00 15.10.2010
18.10.2007 12,000.00 0.00 18.10.2010
19.10.2007 5,000.00 0.00 19.10.2010
19.10.2007 8,000.00 0.00 18.10.2009
22.10.2007 2,500.00 0.00 22.10.2009
30.10.2007 5,000.00 0.00 30.10.2009
TOTAL 146,700.00 36,000.00

Secured by exclusive charge by way of hypothecation of loan agreements.

(iii) Privately Placed Redeemable Non-Convertible Debenture of Rs.1,000/- each

Amount (Rs. in lacs)

Date of Redemption
Allotment/renewal As at March 31, As at March 31, date
2008 2007
18.07.2006 Nil 10,000.00 18.07.2007
29.08.2006 Nil 1,500.00 29.11.2007
31.08.2006 Nil 10,000.00 29.08.2007
26.09.2006 Nil 1,000.00 24.12.2007
26.09.2006 Nil 1,000.00 25.09.2007
27.09.2006 Nil 500.00 26.09.2007
18.01.2007 0.44 0.44 18.01.2009
07.06.2007 2,500.00 0.00 06.05.2008
20.06.2007 500.00 0.00 18.06.2008
22.06.2007 2,500.00 0.00 23.06.2008
07.08.2007 5,000.00 0.00 30.07.2009
21.09.2007 3,400.00 0.00 19.09.2008
TOTAL 13,900.44 24,000.44

Secured by exclusive charge by way of hypothecation of loan agreements.

F-125
b) Term Loans :
(Rs. in lacs)
As at March 31, As at March
2008 31, 2007
i. From Financial Institutions / Corporates :
(a) Secured by an exclusive charge by way of
hypothecation of specific movable assets 106,342.57 75,471.30
being fixed/current assets relating to
hypothecation loans
(b) Secured by an exclusive charge by way of
hypothecation of specific immovable/ 1,785.36 2,053.72
movable assets pertaining to the wind farm
(c) Secured by an exclusive charge by way of
hypothecation of specific immovable/ 963.00 1,126.38
movable assets pertaining to the wind farm
and guaranteed by a former Director.
ii. From Foreign Institution:
Secured by an exclusive charge by way of Hypothecation
of specific Loan agreements and all amounts owing to and 2,172.80 3,621.33
received by the Company pursuant to the above
Agreements
Total 111,263.73 82,272.73

(Rs. in lacs)
As at March 31, As at March
2008 31, 2007

iii. From Banks :

(a) Secured by hypothecation of vehicles 10.07 13.47
(b) Secured by an exclusive charge by way of
hypothecation of specific movable assets 502,000.38 256,001.64
being fixed / current assets relating to
lease, hypothecation loans
(c) Secured by an exclusive charge by way of
hypothecation of specific immovable/ 1,202.27 1,431.99
movable assets pertaining to the wind farm

(d) Secured by an exclusive charge by way of

hypothecation of specific immovable/ 2,116.56 2,378.38
movable assets pertaining to the bio mass
plant.
Total 505,329.28 259,825.48

F-126
 c) Cash Credit from Banks
(Rs. in lacs)
As at March 31, As at March
2008 31, 2007
Cash Credit from Banks 225,646.66 104,118.36
Secured by hypothecation of specific assets covered under Loan Agreements, Book debts, equitable
mortgage of title deeds of immovable property.

2. Subordinated Debt
The Company has raised Tier II capital by issue of subordinated debt bonds amounting to Rs.
30,516.38 lacs (March 31, 2007: Rs. 29,924.71 lacs) with coupon rate of 10 % to 12% per
annum which are redeemable over a period of 62 months to 80 months.

3. Cash & Cash Equivalents

(Rs. in lacs)
Particulars Year ended March Year ended March
31, 2008 31, 2007
Cash & Bank balance 137,420.45 181,064.16
Less : Fixed deposits having original maturity
greater than 3 months or pledged with banks or lien 70,221.15 37,042.50
marked deposits
Balance considered as cash & cash equivalents for
67,199.30 144,021.66
cash flow statement

4. Gratuity and other post-employment benefit plans:

The Company has an unfunded defined benefit gratuity plan. Every employee who has
completed five years or more of service gets a gratuity on separation at 15 days salary (last
drawn salary) for each completed year of service.

Till March 31, 2007, the Company was providing for leave benefits based on actuarial valuation.
In the current year, the Company has adopted the AS 15 (Revised) which is mandatory from
accounting periods commencing on or after December 7, 2006. Accordingly the Company has
changed method of providing short term leave benefits from actuarial valuation to estimate basis.
Further, in accordance with the transitional provision in the revised AS, no amount has been
adjusted to the General Reserve as the amount is not material. This change is not having material
impact on the profit for the current year.

Consequent to the adoption of revised AS 15 ‘Employee Benefits’ issued by the ICAI, the
following disclosures have been made as required by the standard:

F-127
Profit and Loss account
Net employee benefit expense (recognized in Employee Cost) (Rs. in lacs)
Gratuity
Particulars March 31, 2008
Current service cost 53.25
Interest cost on benefit obligation 17.24
Expected return on plan assets NA
Net actuarial (gain) / loss recognised in the year 101.94
Past service cost Nil
Net benefit expense 172.43
Actual return on plan assets NA

Balance sheet
Details of Provision for gratuity (Rs. in lacs)
Gratuity
Particulars March 31, 2008
Defined benefit obligation 322.76
Fair value of plan assets NA
322.76
Less: Unrecognised past service cost Nil
Plan asset / (liability) (322.76)

Changes in the present value of the defined benefit obligation are as follows:

(Rs. in lacs)
Gratuity
Particulars March 31, 2008
Opening defined benefit obligation 174.31
Interest cost 17.24
Current service cost 53.25
Benefits paid (23.98)
Actuarial (gains) / losses on obligation 101.94
Closing defined benefit obligation 322.76

The Company would not contribute any amount to gratuity in 2008-09 as the scheme is unfunded.

F-128
The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
Gratuity
Particulars March 31, 2008
%
Investments with insurer NA

The principal assumptions used in determining gratuity obligations for the company’s plan are shown below
:
Gratuity
Particulars March 31, 2008
Discount Rate 8%
Increase in compensation cost 5%
Employee Turnover 5% and 10%

The estimates of future salary increases, considered in actuarial valuation, take account of inflation,
seniority, promotion and other relevant factors, such as supply and demand in the employment market.

Amounts for the current period are as follows: (Rs. in lacs)

Particulars March 31, 2008
Defined benefit obligation 322.76
Plan assets NA
Surplus / (deficit) (322.76)
Experience adjustments on plan liabilities 101.94
Experience adjustments on plan assets NA

The current year being the first year of adoption of AS 15 (revised) by the Company, the previous year
comparative information has not been furnished.

F-129
5.
The Company is a primarily engaged in financing activities. It operates in a single business and
geographical segment. The Company also owns windmills and biomass which generate income
from sale of electricity and the same has been classified as ‘Unallocated reconciling item’ as per
requirements of AS – 17 on ‘Segment Reporting’ issued by ICAI.
(Rs. in lacs)
Year ended March 31, 2008 Year ended March 31, 2007
Unallocated Unallocated
Particulars Financing Financing
reconciling Total reconciling Total
Activities Activities
items items
Segment Revenue 249,612.56 1,290.12 250,902.68 141,007.94 1,130.66 142,138.60
Segment Results
(Profit before tax
and after interest on 62,225.82 (956.50) 61,269.32 28,993.09 390.13 29,383.22
Financing Segment)

Less: Interest on
unallocated N.A. 686.02 686.02 N.A. 460.80 460.80
reconciling items
Net profit before
62,225.82 (1,642.52) 60,583.30 28,993.09 (70.67) 28,922.42
tax
Less: Income taxes N.A. N.A. 21,600.65 N.A. N.A. 9,882.71
Net profit N.A. N.A. 38,982.65 N.A. N.A. 19,039.71
Other Information:
Segment assets 1,813,703.73 10,785.10 1,824,488.83 1,069,157.13 12,257.85 1081,414.98
Unallocated
2,372.02 2,120.47
corporate assets
Total Assets 1,813,703.73 10,785.10 1,826,860.85 1,069,157.13 12,257.85 1,083,535.45
Segment liabilities 1,635,520.68 6,089.70 1,641,610.38 959,257.03 6,988.92 966,245.95
Unallocated
3,614.57 8,661.98
corporate liabilities
Total Liabilities 1,635,520.68 6,089.70 1,645,224.95 959,257.03 6,988.92 974,907.93
Capital expenditure 1,266.01 Nil 1,266.01 1,851.87 1,184.44 3,036.31
Depreciation 1,884.86 1,821.11 3,705.97 414.81 570.32 985.13
Other non - cash
29,713.13 13.73 29,726.86 18,991.11 Nil 18,991.11
expenses

6. Related Party Disclosures

Subsidiaries : Shriram Powergen Limited (upto March 27, 2008)

Associates : Shriram Asset Management Company Limited

Ashley Transport Services Limited (upto July 3, 2007)

Enterprises having significant influence Shriram Holdings (Madras) Private Limited

over the Company : Shriram Capital Limited (formerly known as Shriram
Financial Services Holding Private Limited)
Newbridge India Investments II Limited

Key Managerial Personnel : R Sridhar, Managing Director

Relatives of Key Managerial Personnel : Mrs. Padmapriya Sridhar (spouse)

F-130
 (Rs. In Lacs)
Enterprises having Relatives of Key
Key Management
significant influence Subsidiaries Associates Management Total
Personnel
over the Company Personnel
2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007
Payments/Expenses

Employee benefits for key

- - - - - - 66.53 20.32 - - 66.53 20.32
management personnel
Royalty 623.54* 356.35* - - - - - - - - 623.54 356.35
Data Sourcing fees 57.95* 44.61* - - - - - - - - 57.95 44.61
Service Charges 347.70* 266.28* - - - - - - - 347.70 266.28
Equity dividend 2,561.15# 2,263.15# - - - - 2.52 2.37 1.22 1.22 2,564.89 2,266.74
Interest on subordinate debt - - - - 101.94^ 46.50^ - - - - 101.94 46.50
Investments in shares - - - 4.99 30.00@ 180.00@ - - - - 30.00 184.99
Rent paid 58.80* 45.80* - - - - - - - - 58.80 45.80
Rental Deposit - 49.00* - - - - - - - - - 49.00
Receipts/Income
Sale of investments - - 4.99 - 112.50@ - - - - - 117.49 -
Subscription of equity shares 6,955.20# 9,282.00# - - - - - 1.75 - - 6,955.20 9,283.75
Subscription to optionally
2,400.00# - - - - - - - - - 2,400.00 -
convertible warrants
Rent & electricity - - - - 5.40^ 5.40^ - - - - 5.40 5.40
Balance outstanding at the year end
Share capital 8,537.15# 7,847.15# - - - - 8.40 8.12 4.05 4.05 8,549.60 7,859.32
Share warrants 2,400.00# 772.80# - - - - - - - - 2,400.00 772.80
Investments in shares - - - 4.99 240.00+ 420.00+ - - - - 240.00 424.99
Outstanding expenses 62.18* 147.04* - - - - 30.00 - - - 92.18 147.04
Rent Deposit given 49.00* 49.00* - - - - - - - - 49.00 49.00
Interest payable on subordinate
- - - - 233.22^ 131.28^ - - - - 233.22 131.28
debt

F-131
* Denotes transactions with Shriram Capital Limited (formerly known as Shriram Financial Services
Holding Private Limited)
# Denotes transactions with Shriram Holdings (Madras) Private Limited

^ Denotes transactions with Shriram Asset Management Company Limited

@ Denotes transactions with Ashley Transport Services Limited

+ Investments in shares as on March 31, 2008 includes Rs. 240.00 Lacs (March 31, 2007: Rs. 240.00
lacs) invested in Shriram Asset Management Company Limited and Rs. Nil (March 31, 2007: Rs.
180.00 lacs) in Ashley Transport Services Limited

7. Leases
In case of assets given on operating lease
The Company has given land and building on operating lease for period ranging 11 months to 60
months.

In case of assets given on Financial lease including hire purchase

The Company has given vehicles on finance lease. The lease term is for 3 to 5 years. There is no
escalation clause in the lease agreement. There are no restrictions imposed by lease arrangements.

(Rs. in lacs)
As at March 31, As at March 31,
2008 2007
Total gross investment in the lease 6,539.13 22,654.39
Less : Unearned finance income 800.06 5,088.49
Less: Unguaranteed residual value Nil Nil
Present value of minimum lease payments 5,739.07 17,565.90
Gross investment in the lease for the period :
Not later than one year [Present value of minimum 6,164.18 15,373.89
lease payments receivable Rs. 5,388.35 lacs as on
March 31, 2008 (March 31, 2007: Rs.11,693.34
lacs)]
Later than one year but not later than five years 374.95 7,280.50
[Present value of minimum lease payments
Rs.350.72 lacs as on March 31, 2008 (March 31,
2007 : Rs. 5,872.56 lacs)]
Later than five years [Present value of minimum Nil Nil
lease payments Nil as on March 31, 2008 (March
31, 2007: Nil)]

In case of assets taken on lease

The Company has taken various office premises, furniture and fixtures, IT equipments and plant
and machinery under operating lease. The lease payments recognized in the profit & loss account
are Rs.1,475.33 lacs (March 31, 2007: Rs.987.91 lacs). Certain agreements provide for
cancellation by either party and certain agreements contains clause for escalation and renewal of
agreements. There are no sub leases.

F-132
 The future minimum lease payments in respect of non-cancellable operating lease as at the balance
sheet date are summarized below :
(Rs. in lacs)
Year ended March Year ended
31, 2008 March 31, 2007

Minimum Lease Payments:

Not later than one year 334.18 173.99
Later than one year but not later than five years 468.61 167.75
Later than five years Nil Nil

8. In accordance with the Reserve Bank of India circular no.RBI/2006-07/ 225 DNBS (PD) C.C No.
87/03.02.004/2006-07 dated January 4, 2007, the Company has created a floating charge on the
statutory liquid assets comprising of investment in Government Securities to the extent of
Rs.427.44 lacs in favour of trustees representing the public deposit holders of the Company.

9. Earnings per share

Year ended March Year ended March

Particulars
31, 2008 31, 2007
Net Profit after tax as per profit and loss account (Rs. in
38,982.65 19,039.71
lacs) (A)
Weighted average number of equity shares for calculating
1,924.01 1,729.59
Basic EPS (in lacs) (B)
Weighted average number of equity shares for calculating
1,977.76 1,812.07
Diluted EPS (in lacs) (C)
Basic earnings per equity share (in Rupees) (Face value of
20.26 11.01
Rs. 10/- per share) (A) / (B)
Diluted earnings per equity share (in Rupees) (Face value
19.71 10.51
of Rs. 10/- per share) (A) / (C)

Year ended March Year ended March

Particulars 31, 2008 31, 2007
Weighted average number of equity shares for calculating
1,924.01 1,729.59
EPS (in lacs)
Add : Equity shares arising on conversion of optionally
23.83 69.00
convertible warrants (in lacs)
Add : Equity shares for no consideration arising on grant of
29.92 13.48
stock options under ESOP (in lacs)
Weighted average number of equity shares in calculation
1,977.76 1,812.07
diluted EPS (in lacs)

F-133
 (Rs. in lacs)
10. Deferred Tax Liabilities (Net)

The break up of deferred tax asset / liabilities is as As at March 31, As at March 31,
under:- 2008 2007

Deferred Tax Liabilities

Timing difference on account of :

Differences due to accelerated amortisation of
intangibles under Income Tax Act Nil 31.26

Differences in depreciation in block of fixed assets as

2,755.33 3,191.73
per tax books and financial books
Effect of lease accounting 1,753.86 5,705.17

Others Nil 141.60

Gross Deferred Tax Liabilities (A) 4,509.19 9,069.76
Deferred Tax Asset
Timing difference on account of :
Expenses disallowed under Income Tax Act, 1961 173.47 81.17
Provision for securitization 503.73 326.61
Provision for hedging contracts 239.78 Nil
Gross Deferred Tax Assets (B) 916.98 407.78

Deferred Tax Liabilities (Net) (A-B) 3,592.21 8,661.98

(Rs. in lacs)
As at March 31, As at March 31,
11. Capital Commitments
2008 2007
Estimated amount of contracts remaining to be executed
100.00 375.56
on capital account and not provided for (net of advances)

F-134
 (Rs. in lacs)
As at March 31, As at March 31,
12. Contingent Liabilities not provided for
2008 2007
Disputed income tax/interest tax demand contested in 3,381.70 5,754.90
appeals not provided for

[Against the above, a sum of Rs. 318.11 lacs (March 31,

2007: Rs. 318.11 lacs) has been paid under protest]

Demands in respect of Service tax 284.00 230.24

[Amount of Rs.15 lacs (March 31, 2007 : Rs. 15 lacs) has
been paid under protest ]

Guarantees issued by the Company and outstanding 1,991.58 4,101.12

In respect of portfolio management Nil 356.67

13. The Company has converted 6,900,000 warrants issued to Shriram Holdings (Madras) Private
Limited into equity shares at a premium of Rs.102/- during the year. The amount of Rs. 36,000
lacs (including securities premium of Rs. 34,800 lacs) received from preferential allotment of
shares was utilized for the purpose of increasing the networth and working capital of the
Company. The Company has further issued 8,000,000 warrants to Shriram Holdings (Madras)
Private Limited on a preferential basis with an option to convert into equity shares of Rs 300/-
each (including securities premium of Rs 290/-) within 18 months from the date of issue i.e.
December 14, 2007.
14. Recovery of service tax on lease and hire purchase transactions is kept in abeyance in view of
the stay granted by Honourable Madras High Court. If any liability arises it will be recovered
from the concerned parties. However, on contracts that are terminated, pending decision from
the Honourable Madras High Court, equivalent service tax is written off.

15. Borrowing costs aggregating to NIL (March 31, 2007: Rs. 381.05 lacs) being interest on
specific term loan from a bank for Bio Mass Plant have been capitalized during the year.

F-135
 16. Employee Stock Option Plan

Series I Series II Series III Series IV

Date of grant October 31, 2005 April 1, 2006 October 9, 2006 August 17, 2007
Date of Board
October 19, 2005 February 22, 2006 September 6, 2006 August 17, 2007
Approval
Date of
Shareholder’s October 13, 2005 October 13, 2005 October 13, 2005 October 13, 2005
approval
Number of 109,000
2,962,500 832,500 910,000
options granted
Method of
Settlement Equity Equity Equity Equity
(Cash/Equity)
Graded Vesting Period
After 1 year of 10% of options 10% of options 10% of options 10% of options
grant date granted granted granted granted
After 2 years of 20% of options 20% of options 20% of options 20% of options
grant date granted granted granted granted
After 3 years of 30% of options 30% of options 30% of options 30% of options
grant date granted granted granted granted
After 4 years of 40% of options 40% of options 40% of options 40% of options
grant date granted granted granted granted

Exercisable 10 years from 10 years from 10 years from 10 years from

period vesting date vesting date vesting date vesting date
Vesting On achievement of pre-determined targets
Conditions

The details of Series I have been summarized below:

As at March 31, 2008 As at March 31, 2007

Number of Weighted Number Weighted
Shares Average of Shares Average
Exercise Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 2,492,750 Rs. 35.00 2,962,500 Rs. 35.00
Add: Granted during the year Nil - Nil -
Less: Forfeited during the year Nil - Nil -
Less: Exercised during the year 57,800 Rs. 35.00 157,250 Rs.35.00
Less: Expired during the year 257,950 - 312,500 -
Outstanding at the end of the year 2,177,000 Rs. 35.00 2,492,750 Rs.35.00
Exercisable at the end of the year 528,260 - 110,450
Weighted average remaining contractual 10.09 11.09
life (in years)
Weighted average fair value of options Rs. 59.04 Rs.59.04
granted

F-136
The details of Series II have been summarized below:

As at March 31, 2008 As at March 31, 2007

Number of Weighted Number Weighted
Shares Average of Average
Exercise Shares Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 744,000 Rs.35.00 Nil -
Add: Granted during the year Nil - 832,500 Rs.35.00
Less: Forfeited during the year Nil - Nil -
Less: Exercised during the year 18,900 Rs.35.00 Nil -
Less: Expired during the year 171,000 - 88,500 -
Outstanding at the end of the year 554,100 Rs.35.00 744,000 Rs.35.00
Exercisable at the end of the year 38,400 Nil
Weighted average remaining contractual 10.49 11.49
life (in years)
Weighted average fair value of options Rs. 91.75 Rs. 91.75
granted

The details of Series III have been summarized below:

As at March 31, 2008 As at March 31, 2007

Number of Weighted Number Weighted
Shares Average of Average
Exercise Shares Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 885,000 Rs.35.00 Nil -
Add: Granted during the year Nil - 910,000 Rs.35.00
Less: Forfeited during the year Nil - Nil -
Less: Exercised during the year Nil - Nil -
Less: Expired during the year 74,000 - 25,000 -
Outstanding at the end of the year 811,000 Rs.35.00 885,000 Rs.35.00
Exercisable at the end of the year 81,100 - Nil -
Weighted average remaining contractual 11.01 12.01
life (in years)
Weighted average fair value of options Rs.74.85 Rs.74.85
granted

F-137
The details of Series IV have been summarized below:

As at March 31, 2008 As at March 31, 2007

Number of Weighted Number Weighted
Shares Average of Average
Exercise Shares Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year Nil - - -
Add: Granted during the year 109,000 Rs.35.00 - -
Less: Forfeited during the year Nil - - -
Less: Exercised during the year Nil - - -
Less: Expired during the year Nil - - -
Outstanding at the end of the year 109,000 Rs.35.00 - -
Exercisable at the end of the year Nil - - -
Weighted average remaining contractual 11.88 - -
life (in years)
Weighted average fair value of options 136.40 - -
granted

The weighted average share price for the period over which stock options were exercised was Rs.270.76
(March 31, 2007: Rs. 135.53)

The details of exercise price for stock options outstanding at the end of the year are:
March 31, 2008

Series Range of Number of Weighted average Weighted

exercise prices options remaining average exercise
outstanding contractual life of price
options (in years)
Series I Rs.35/- 2,177,000 10.09 Rs.35/-
Series II Rs.35/- 554,100 10.49 Rs.35/-
Series III Rs.35/- 811,000 11.01 Rs.35/-
Series IV Rs.35/- 109,000 11.88 Rs.35/-

March 31, 2007

Series Range of Number of Weighted average Weighted average

exercise options remaining exercise price
prices outstanding contractual life of
options (in years)
Series I Rs.35/- 2,492,750 11.09 Rs.35/-
Series II Rs.35/- 744,000 11.49 Rs.35/-
Series III Rs.35/- 885,000 12.01 Rs.35/-

F-138
Stock Options granted

Series I:

The weighted average fair value of stock options granted was Rs.59.04. The Black Scholes
model has been used for computing the weighted average fair value of options considering the
following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 38.44 38.44 38.44 38.44
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 5.98 6.33 6.54 6.73
Expected dividend rate (%) 2.31 2.31 2.31 2.31

Series II :

The weighted average fair value of stock options granted was Rs.91.75. The Black Scholes
model has been used for computing the weighted average fair value of options considering the
following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 19.89 19.89 19.89 19.89
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.64 6.83 6.93 7.26
Expected dividend rate (%) 2.52 2.52 2.52 2.52

Series III :

The weighted average fair value of stock options granted was Rs.74.85. The Black Scholes
model has been used for computing the weighted average fair value of options considering the
following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 31.85 31.85 31.85 31.85
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.96 7.10 7.26 7.40
Expected dividend rate (%) 2.52 2.52 2.52 2.52

F-139
Series IV :

The weighted average fair value of stock options granted was Rs. 136.40. The Black Scholes
model has been used for computing the weighted average fair value of options considering the
following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 41.51 41.51 41.51 41.51
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 7.68 7.76 7.82 7.87
Expected dividend rate (%) 0.89 0.89 0.89 0.89

The expected volatility was determined based on historical volatility data equal to the NSE
volatility rate of Bank Nifty which is considered as a comparable peer group of the Company.
To allow for the effects of early exercise, it was assumed that the employees will exercise the
options within six months from the date of vesting in view of the exercise price being
significantly lower than the market price.

Effect of the employee share-based payment plans on the profit and loss account and on its
financial position:

(Rs. in lacs)
As at March As at March
31, 2008 31, 2007
Total compensation cost pertaining to employee share- 653.95 987.16
based payment plan (entirely equity settled)
Liability for employee stock options outstanding as at year 2,689.69 2,961.28
end
Deferred compensation cost 863.05 1,733.90

Since the enterprise used the intrinsic value method the impact on the reported net profit
and earnings per share by applying the fair value based method is as follows:

In March 2005, ICAI has issued a guidance note on “Accounting for Employees Share Based
Payments” applicable to employee based share plan the grant date in respect of which falls on or
after April 1, 2005. The said guidance note requires that the proforma disclosures of the impact
of the fair value method of accounting of employee stock compensation accounting in the
financial statements. Applying the fair value based method defined in the said guidance note, the
impact on the reported net profit and earnings per share would be as follows:

F-140
 Year ended Year ended
March 31, 2008 March 31, 2007
Profit as reported (Rs. in lacs) 38,982.65 19,039.71
Add: Employee stock compensation under intrinsic value
653.95 987.16
method (Rs. in lacs)
Less: Employee stock compensation under fair value
615.95 936.26
method (Rs. in lacs)
Proforma profit (Rs. in lacs) 39,020.65 19,090.61
Earnings per share
Basic (Rs.)
- As reported 20.26 11.01
- Proforma 20.28 11.04
Diluted (Rs.)
- As reported 19.71 10.51
- Proforma 19.73 10.54
Nominal value 10.00 10.00

17. Securitisation/ Direct assignment

The Company sells loans through securitisation and direct assignment. The information on
securitisation and direct assignment activity of the Company as an originator for the year March 31,
2008 and March 31, 2007 is given below:

Year ended Year ended

March 31, 2008 March 31, 2007
Total number of loan assets securitized/directly
65,020 68,204
assigned
Total book value of loan assets securitized/directly
211,822.17 285,979.49
assigned (Rs. in lacs)
Sale consideration received for the securitized/directly
248,140.60 311,095.04
assigned assets (Rs. in lacs)
Gain on account of securitization/direct assignment*
36,318.39 29,070.05
(Rs. in lacs)

* Gain on securitisation / direct assignment deals done after February 1, 2006 is amortised over the
period of the loan.

The information on securitisation & direct assignment activity of the Company as an originator as on
March 31, 2008 and March 31, 2007 is given in the table below :
(Rs. in Lacs)
As at March 31, As at March 31,
2008 2007
Outstanding credit enhancement 56,687.05 31,095.67
Outstanding liquidity facility 7,127.85 2,236.77
Outstanding subordinate contribution 5,159.40 6,199.80

F-141
18. Derivative Instruments:
The Notional principal amount of derivative transactions outstanding as on March 31, 2008 for
principal swaps are Rs. NIL (March 31, 2007 – Rs.60,000 lacs) and for interest rate swaps Rs.
95,000 lacs (March 31, 2007 – Nil). The interest rate swaps is to hedge against exposure to
variable interest outflow on loans. The broad term of the instruments are to receive fixed rate of
interest/variable rate equal to INBMK and to pay a variable rate equal to INBMK/MIBOR.
19. During the year ended March 31, 2008, the Company has reassessed the balance useful life of its
Computer Software, Windmills and Leasehold improvement (Furniture & fixtures and Electrical
equipments / fittings). Based on such reassessment, the estimated balance useful life has reduced
from 5 years to 3 years, 6 years to 3 years and 16-21 years to 5 years respectively. Accordingly,
the Company has provided additional depreciation amounting to Rs. 1,492.74 lacs in respect of
these assets during the year.

20. Supplementary Statutory Information

(Rs. in lacs)
i Managing Director’s Remuneration
Year ended Year ended
March 31, 2008 March 31, 2007
Salaries 46.96 6.10
Perquisites 9.78 1.30
Contribution to Provident fund 0.09 0.09
Employee stock option scheme 9.70 12.83
66.53 20.32
Note: - As the future liability for gratuity and leave encashment is provided on an actuarial
basis for the Company as a whole, the amount pertaining to the directors is not ascertainable
and, therefore, not included above.
The computation of profits under section 349 of the Act has not been given as no commission
is payable to the Directors / Managing Director.

(Rs. in lacs)
ii Expenditure in foreign currency (On cash basis)
Year ended Year ended
March 31, 2008 March 31, 2007
Travelling 13.81 3.40
Others Nil Nil
13.81 3.40

F-142
iii Net dividend remitted in foreign Year ended March 31, Year ended March 31,
exchange 2008 2007
Period to which it relates Interim Final Interim Final
2007-08 2006-07 2006-07 2005-06
Number of non-resident shareholders 6 2 3 2
Number of equity shares held on which 45,863,023 35,125,801 28,617,378 37,313,169
dividend was due
Amount remitted (state the foreign
currency)
Euro - 2,234 38,388 75,501
American Dollar 1,154,077 1,683,294 990,400 1,118,940
Yuan - - 13,652 -

21. Additional information pursuant to the provisions of paragraphs 3, 4C and 4D of Part II of

schedule VI to the Act

i Licensed Capacity, Installed capacity, Actual production and Sales

Class of Units Licensed Installed Capacity Actual Production and Sales Value
Goods Capacity as as at March 31, (in Sales for the year ended
(Rs. in lacs)
at March 31, KW) March 31, (in units)
2008 2007 2008 2007 2008 2007 2008 2007
Windmill 44 NA NA 22,430 22,430 30,200,617 36,013,398 966.44 1130.66
Biomass 1 NA NA 7,500 NIL 10,275,400 NIL 323.68 NIL

ii Consumption of raw materials - indigenous

Raw material Units Quantity for the year Value for the year ended
ended March 31, March 31, (Rs in lacs)
2008 2007 2008 2007
Biomass Fuel Tons 25,332 NIL 258.06 NIL

22. The Company has initiated the process of identification of ‘suppliers’ registered under the
“The Micro, Small and Medium Enterprises Development (‘MSMED’) Act, 2006” by
obtaining confirmations from suppliers. Based on the intimation received by the Company,
none of the suppliers have confirmed to be registered under MSMED Act, 2006. Accordingly,
no disclosures relating to amounts unpaid as at the year end together with interest paid
/payable are required to be furnished.

23. Final dividend (including tax on dividend) includes an amount of Rs 162.45 lacs in respect of
dividend paid by the Company for the previous year on 6,942,500 equity shares allotted before
the date of book closure as they rank pari-passu with the existing equity shares for dividend.
24. The auditors’ report dated May 26, 2008 on the financial statements as of and for year ended
March 31, 2008 included, as an Annexure, a statement on certain matters specified in the
Companies (Auditors Report) Order, 2003, which was modified to indicate that there was
undisputed statutory dues remaining unpaid for more than six months.

25. Previous Year Comparatives

The figures for the previous year have been regrouped and reclassified, wherever necessary to
conform to current year’s classification.

F-143
Notes to Accounts for the year 2006-2007

1. SECURED LOANS

a) (i) Privately placed Redeemable Non-convertible Debentures:

(Rs. in lacs)
As at March 31, As at March
2007 31, 2006
Redeemable Non-Convertible Debentures of Rs.1,000/-each
Number 12,379,858 17,443,008
Amount 123,798.58 174,430.08

Secured by mortgage of office premises, charge on Plant and Machinery, Furniture and other fixed
assets of the Company, charge on Company’s book debts, leased assets, lease rentals including
future receivables, loans, advances and other investments of the Company subject to prior charges
created or to be created in favor of the Company’s bankers, financial institutions and others.

Debentures are redeemable over a period of 6 months to 160 months from the date of allotment
depending on the terms of the agreement.

(ii) Redeemable Non-Convertible Debenture of Rs.1,000,000/- each

Date of Amount (Rs. in lacs)

Redemption date
Allotment/renewal 31.03.2007 31.03.2006
26.09.2005 Nil 10,000.00 24.01.2007
05.05.2006 5,000.00 Nil 04.05.2007
23.10.2006 10,000.00 Nil 24.10.2007
12.12.2006 5,000.00 Nil 17.12.2007
14.12.2006 5,000.00 Nil 18.04.2008
18.01.2007 11,000.00 Nil 18.07.2008
TOTAL 36,000.00 10,000.00

Secured by hypothecation of specific assets covered under agreements by way of an exclusive charge.

(iii) Redeemable Non-Convertible Debenture of Rs.1,000/- each

Date of Amount (Rs. in lacs) Redemption

Allotment/renewal 31.03.2007 31.03.2006 date
18.07.2006 10,000.00 Nil 18.07.2007
29.08.2006 1,500.00 Nil 29.11.2007
31.08.2006 10,000.00 Nil 29.08.2007
26.09.2006 1,000.00 Nil 24.12.2007
26.09.2006 1,000.00 Nil 25.09.2007
27.09.2006 500.00 Nil 26.09.2007
18.01.2007 0.44 Nil 30.05.2007
TOTAL 24,000.44 Nil

F-144
Secured by hypothecation of specific assets covered under agreements by way of an exclusive
charge.

b) Term Loans :
(Rs. in lacs)
As at March 31, As at March
2007 31, 2006
i. From Financial Institutions / Corporate :
(a) Secured by an exclusive charge by way of
hypothecation of specific movable assets 75,471.30 34,839.13
being fixed/current assets relating to lease
and hire purchase agreements and
hypothecation loans
(b) Secured by an exclusive charge by way of
hypothecation of specific immovable/ 2,053.72 2,322.08
movable assets pertaining to the wind farm
(c) Secured by an exclusive charge by way of
hypothecation of specific immovable/ 1,126.38 1,326.66
movable assets pertaining to the wind farm
ii. From Foreign Institution:
Secured by an exclusive charge by way of Hypothecation
of specific Hire Purchase agreements and all amounts
owing to and received by the Company pursuant to the 3,621.33 5,069.87
above Hire Purchase Agreements

Total 82,272.73 43,557.74

iii. From Banks :
(a) Secured by hypothecation of vehicle 13.47 11.62
(b) Secured by an exclusive charge by way of
hypothecation of specific movable assets 256,001.64 87,216.72
being fixed / current assets relating to
lease, hypothecation loans and hire-
purchase agreements / loan agreements
(c) Secured by an exclusive charge by way of
hypothecation of specific immovable/ 1,431.99 1,661.71
movable assets pertaining to the windfarm

(d) Secured by an exclusive charge by way of

hypothecation of specific immovable/ 2,378.38 2,392.79
movable assets pertaining to the bio mass
plant.
Total 259,825.48 91,282.84

F-145
 c) Cash Credit from Banks
(Rs. in lacs)
As at March 31, As at March
2007 31, 2006
Cash Credit from Banks 104,118.36 54,820.74
Secured by hypothecation of specific assets covered under Hire-Purchase/Lease/Loan Agreements, Book
debts, equitable mortgage of title deeds of the immovable property.

d) HP Refinance Loan
(Rs. in lacs)
As at March 31, As at March
2007 31, 2006
HP refinance loan (From institutions / corporates) Nil 110.39
Secured by hypothecation of vehicles by hirers guaranteed by associate concerns and also by a
former Director of the Company

2. Subordinated Debt
The Company has raised Tier II capital by issue of subordinated debt bonds amounting to Rs.
29,924.71 lacs (March 31, 2006 : Rs. 13,225.77 lacs) with coupon rate of 8 % to 11.50% per
annum which are redeemable over a period of 61 months to 80 months.

3. The Company operates in a single business and geographical segment; hence no disclosure is
given as per requirements of AS – 17 on Segment Reporting issued by ICAI.

4. Related Party Disclosure

Subsidiaries : Shriram Powergen Limited

Associates : Shriram Asset Management Limited

Ashley Transport Services Limited

Enterprises having significant influence : Shriram Holdings (Madras) Private Limited

over the Company Shriram Financial Services Holding Private Limited
Newbridge India Investments II Limited

Key Managerial Personnel : R Sridhar, Managing Director

F-146
 Key Management
Personnel (Managing
Enterprises having
Director, Whole time
significant influence over Subsidiaries Associates Total
director, manager and
the Company
other managerial
personnel)
2007 2006 2007 2006 2007 2006 2007 2006 2007 2006
Payments/Expenses
Employee benefits for key
- - - - - - 20.32 29.24 20.32 29.24
management personnel
Royalty 356.35 212.35 - - - - - - 356.35 212.35
Data sourcing fees 44.61 114.67 - - - - - - 44.61 114.67
Service charges 266.28 688.02 - - - - - - 266.28 688.02
Equity dividend 2,263.15 1257.82 - - - - 2.37 1.66 2,265.52 1259.48
Preference dividend - 418.39 - - - - - - - 418.39
Interest on subordinate debt - - - - 46.50 42.94 - - 46.50 42.94
Redemption of preference share
- 5,147.93 - - - - - - - 5147.93
capital
Investments in shares - - 4.99 - 180.00 - - - 184.99 -
Rent Paid 45.80 45.80
Rental Deposit 49.00 49.00
Receipts/Income - - - - - - - - - -
Sale of assets - 127.24 - - - - - - - 127.24
Subscription of equity shares 9,282.00 30,687.67 - - - - 1.75 - 9,283.75 30,687.67
Subscription to optionally convertible
- 1,792.00 - - - - - - - 1,792.00
warrants
Rent & electricity - - - - 5.40 5.40 - - 5.40 5.40
Balance outstanding at the year end
Share capital 7,847.15 3,931.24 - - - - 8.12 5.54 7,855.27 3,936.78
Share warrants 772.80 1,792.00 - - - - - - 772.80 1,792.00
Investments in shares - - 4.99 - 420.00 240.00 - - 424.99 240.00
Outstanding expenses 147.04 321.00 - F-147
- - - - - 147.04 321.00
Proposed dividend 1,569.43 786.25 - - - - 1.62 1.11- 1,571.05 787.36
Rent Deposit given 49.00 - 49.00 -
Interest payable on subordinate debt - - - - 131.28 84.78 - - 131.28 84.78
5. Leases
In case of assets given on operating lease
The Company has given land and building on operating lease for period ranging 11 months to
60 months.

In case of assets given on Financial lease including hire purchase

The Company has leased out vehicles on finance lease. The lease term is for 3 to 5 years after
which the legal title is passed to the lessee. There is no escalation clause in the lease agreement.
There are no restrictions imposed by lease arrangements.

(Rs. in lacs)
Finance Lease

2007 2006
Total gross investment in the lease 22,654.39 79,597.53
Less : Unearned finance income 5,088.49 19,583.19
Less: Unguarantee residual value Nil Nil
Present value of minimum lease payments 17,565.90 60,014.34
Gross investment in the lease for the period :
Not later than one year [Present value of minimum 15,373.89 48,597.94
lease payments receivable Rs. 11,693.34 lacs as on
March 31, 2007 (March 31, 2006: Rs. 36,551.99
lacs)]
Later than one year but not later than five years 7,280.50 30,999.59
[Present value of minimum lease payments Rs.
5,872.56 lacs as on March 31, 2007 (March 31, 2006
: Rs. 23,462.35 lacs)]
Later than five years [Present value of minimum Nil Nil
lease payments Rs. Nil as on March 31, 2007 (March
31, 2006: Rs. Nil)]

In case of assets taken on lease

The Company has taken various office premises under operating lease. The lease payments
recognized in the profit & loss account are Rs. 987.91 lacs (March 31, 2006 : Rs. 679.78 lacs).
Certain agreements provide for cancellation by either party and certain agreements contains clause
for escalation and renewal of agreements. There are no sub leases.

The future minimum lease payments in respect of non-cancellable operating lease as at the balance
sheet date are summarized below :
(Rs. in lacs)
For the year ended For the year ended
March 31, 2007 March 31, 2006

Minimum Lease Payments:

Not later than one year 173.99 0.63
Later than one year but not later than five years 167.75 29.38
Later than five years Nil Nil

F-148
6. In accordance with the Reserve Bank of India circular no.RBI/2006-07/ 225 DNBS (PD) C.C No.
87/03.02.004/2006-07 dated Januray 4, 2007, the Company has, during the year, created a floating
charge on the statutory liquid assets comprising of investment in Government Securities to the
extent of Rs.592.29 lacs in favour of trustees representing the public deposit holders of the
Company.

7. Cash & Cash Equivalents

(Rs. in Lacs)
For the year ended For the year ended
Particulars March 31, 2007 March 31, 2006
Cash & Bank balance 181,064.16 25040.69
Less : Fixed deposits having original maturity
37,042.50 4596.58
greater than 3 months
Balance considered as cash & cash equivalents for
144,021.66 20,444.11
cash flow statement

8. Earnings per share

For the year ended For the year ended

Particulars March 31, 2007 March 31, 2006
Net Profit after tax as per profit and loss account (Rs. in
19,039.71 14,164.10
lacs)
Less: Preference dividend and tax thereon (Rs. in lacs) Nil 483.10
Net Profit for calculation of EPS (Rs. in lacs) (A) 19,039.71 13,681.00
Weighted average number of equity shares for calculating
1,729.59 1,461.41
Basic EPS (in lacs) (B)
Weighted average number of equity shares for calculating
1,812.07 1,547.38
Diluted EPS (in lacs) (C)
Basic earnings per equity share (in Rupees) (Face value of
11.01 9.36
Rs. 10/- per share) (A) / (B)
Diluted earnings per equity share (in Rupees) (Face value
10.51 8.84
of Rs. 10/- per share) (A) / (C)

For the year For the year ended

Particulars ended March 31, March 31, 2006
2007
Weighted average number of equity shares for calculating
1,729.59 1,461.41
EPS (in lacs)
Add : Equity shares arising on conversion of optionally
69.00 82.58
convertible warrants (in lacs)
Add : Equity shares for no consideration arising on grant of
13.48 3.39
stock options under ESOP (in lacs)
Weighted average number of equity shares in calculation
1,812.07 1,547.38
diluted EPS (in lacs)

F-149
 (Rs. in lacs)
9. Deferred Tax Liabilities (Net)
As at March As at March 31,
The break up of deferred tax asset / liability is as
31, 2007 2006
under:-

Deferred Tax Liabilities

Timing difference on account of :

Differences due to accelerated amortisation of
intangibles under Income Tax Act 31.26 65.70

Differences in depreciation in block of fixed assets as

per tax books and financial books 3,191.73 635.29
Effect of lease accounting 5,705.17 11,693.51
Others 141.60 1,019.12
Gross Deferred Tax Liabilities (A) 9,069.76 13,413.62
Deferred Tax Asset
Timing difference on account of :
Expenses disallowed under Income Tax Act, 1961 81.17 44.77
Provision for securitization 326.61 Nil
Gross Deferred Tax Assets (B) 407.78 44.77

Deferred Tax Liabilities (Net) (A-B) 8,661.98 13,368.85

(Rs. in lacs)
As at March As at March 31,
10. Capital Commitments
31, 2007 2006
Estimated amount of contracts remaining to be executed 375.56 791.40
on capital account and not provided for (net of advances)

F-150
 (Rs. in lacs)
As at March As at March 31,
11. Contingent Liabilities not provided for
31, 2007 2006
Disputed income tax/interest tax demand contested in 5,754.90 5,318.72
appeals not provided for

[Against the above, a sum of Rs. 318.11 lacs (March

31, 2006 : Rs. 268.79 lacs) has been paid under
protest which appears under advances recoverable in
cash or in kind.]

Demands in respect of Service tax 230.24 Nil

[Amount of Rs.15 lacs has been paid under protest
(March 31, 2006 : Nil)]
Guarantees issued by the Company to banks & others 14,557.54 22,850.78

Out of which amount outstanding 4,101.12 1,752.68

In respect of portfolio management 356.67 1123.63

12. The Company has converted 5,715,000 warrants issued to UNO Investments into equity share at
a premium of Rs.25/- and 9,100,000 warrant issued to Shriram Holding (Madras) Private
Limited at a premium of Rs.102/- during the year. The amount of Rs.10,973.03 lacs (including
securities premium of Rs. 9,491.53 lacs) received from preferential allotment of shares was
utilized for the purpose of increasing the networth and working capital of the Company.

13. In view of the circular number 9/2002 dated April 18, 2002 issued by the
Department of Company Affairs, no debenture redemption reserve is required
to be created in case of privately placed debentures, accordingly, the debenture redemption
reserve of Rs.100 lacs created during the year 2000-2001 is transferred to the General Reserve.

14. Recovery of service tax on lease and hire purchase transactions is kept in abeyance in view of
the stay granted by Honourable Madras High Court. If any liability arises it will be recovered
from the concerned parties. However, on contracts that are terminated, pending decision from
the Madras High Court, equivalent service tax is written off.

15. Borrowing costs aggregating to Rs. 381.05 lacs (March 31, 2006 : Rs. 62.01 lacs) being interest
on specific term loan from a bank for Bio Mass Plant under construction have been capitalized
during the year and are included in ‘Capital Work in Progress’

F-151
16. Employee Stock Option Plan

Series I Series II Series III

Date of grant October 31, 2005 April 1, 2006 October 9, 2006
Date of Board Approval October 19, 2005 February 22, 2006 September 6, 2006
Date of Shareholder’s
October 13, 2005 October 13, 2005 October 13, 2005
approval
Number of options
2,962,500 832,500 910,000
granted
Method of Settlement
Equity Equity Equity
(Cash/Equity)
Graded Vesting Period
After 1 year of grant date 10% of options 10% of options 10% of options
granted granted granted
After 2 years of grant date 20% of options 20% of options 20% of options
granted granted granted
After 3 years of grant date 30% of options 30% of options 30% of options
granted granted granted
After 4 years of grant date 40% of options 40% of options 40% of options
granted granted granted

Exercisable period 10 years from 10 years from 10 years from vesting

vesting date vesting date date
Vesting Conditions On achievement of pre-determined targets

The details of Series I have been summarized below:

March 31, 2007 March 31, 2006

Number of Weighted Number Weighted
Shares Average of Shares Average
Exercise Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year 2,962,500 Rs. 35.00 Nil -
Add: Granted during the year Nil - 2,962,500 Rs. 35.00
Less: Forfeited during the year Nil - Nil -
Less: Exercised during the year 157,250 Rs.35.00 Nil -
Less: Expired during the year 312,500 - Nil -
Outstanding at the end of the year 2,492,750 Rs.35.00 2,962,500 Rs.35.00
Exercisable at the end of the year 110,450 Nil
Weighted average remaining contractual 11.09 yrs 12.09 yrs
life (in years)
Weighted average fair value of options Rs.59.04 Rs.59.04
granted

F-152
The details of Series II have been summarized below:
March 31, 2007 March 31, 2006
Number of Weighted Number Weighted
Shares Average of Average
Exercise Shares Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year Nil - - -
Add: Granted during the year 832,500 Rs.35.00 - -
Less: Forfeited during the year Nil - - -
Less: Exercised during the year Nil - - -
Less: Expired during the year 88,500 - - -
Outstanding at the end of the year 744,000 Rs.35.00 - -
Exercisable at the end of the year Nil - -
Weighted average remaining contractual 11.49 yrs - -
life (in years)
Weighted average fair value of options Rs. 91.75 - -
granted

The details of Series III have been summarized below:

March 31, 2007 March 31, 2006
Number of Weighted Number Weighted
Shares Average of Average
Exercise Shares Exercise
Price(Rs.) Price(Rs.)
Outstanding at the beginning of the year Nil - - -
Add: Granted during the year 910,000 Rs.35.00 - -
Less: Forfeited during the year Nil - - -
Less: Exercised during the year Nil - - -
Less: Expired during the year 25,000 - - -
Outstanding at the end of the year 885,000 Rs.35.00 - -
Exercisable at the end of the year Nil - - -
Weighted average remaining contractual 12.01 yrs - -
life (in years)
Weighted average fair value of options Rs.74.85 - -
granted

The weighted average share price for the period over which stock options were exercised was
Rs.135.53.

The details of exercise price for stock options outstanding at the end of the year are:
March 31, 2007

Series Range of Number of Weighted average Weighted

exercise prices options remaining average exercise
outstanding contractual life of price
options (in years)
Series I Rs.35/- 2,492,750 11.09 years Rs.35/-
Series II Rs.35/- 744,000 11.49 years Rs.35/-
Series III Rs.35/- 885,000 12.01 years Rs.35/-

F-153
March 31, 2006

Series Range of Number of Weighted average Weighted

exercise prices options remaining average exercise
outstanding contractual life of price
options (in years)
Series I Rs.35/- 2,962,500 12.09 years Rs.35/-
Series II Nil Nil Nil Nil
Series III Nil Nil Nil Nil

Stock Options granted

Series I:

The weighted average fair value of stock options granted was Rs.59.04. The Black Scholes
model has been used for computing the weighted average fair value of options considering the
following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility 38.44% 38.44% 38.44% 38.44%
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate 5.98% 6.33% 6.54% 6.73%
Expected dividend rate 2.31% 2.31% 2.31% 2.31%

Series II :

The weighted average fair value of stock options granted was Rs.91.75. The Black Scholes
model has been used for computing the weighted average fair value of options considering the
following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility 19.89% 19.89% 19.89% 19.89%
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate 6.64% 6.83% 6.93% 7.26%
Expected dividend rate 2.52% 2.52% 2.52% 2.52%

F-154
 Series III :

The weighted average fair value of stock options granted was Rs.74.85. The Black Scholes
model has been used for computing the weighted average fair value of options considering the
following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility 31.85% 31.85% 31.85% 31.85%
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and 1.50 2.50 3.50 4.50
exercise period) in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate 6.96% 7.10% 7.26% 7.40%
Expected dividend rate 2.52% 2.52% 2.52% 2.52%

The expected volatility was determined based on historical volatility data equal to the NSE
volatility rate of Bank Nifty which is considered as a comparable peer group of the Company.
To allow for the effects of early exercise, it was assumed that the employees will exercise the
options within six months from the date of vesting in view of the exercise price being
significantly lower than the market price.

Effect of the employee share-based payment plans on the profit and loss account and on its
financial position:

(Rs. in lacs)
2007 2006
Total compensation cost pertaining to employee share- 987.16 353.49
based payment plan (entirely equity settled)
Liability for employee stock options outstanding as at year 2,961.28 2,120.92
end
Deferred compensation cost 1,733.90 1,767.43

Since the enterprise used the intrinsic value method the impact on the reported net profit
and earnings per share by applying the fair value based method is as follows :

In March 2005, ICAI has issued a guidance note on “Accounting for Employees Share Based
Payments” applicable to employee based share plan the grant date in respect of which falls on or
after April 1, 2005. The said guidance note requires that the proforma disclosures of the impact of
the fair value method of accounting of employee stock compensation accounting in the financial
statements. Applying the fair value based method defined in the said guidance note, the impact on
the reported net profit and earnings per share would be as follows:

F-155
 For the year For the year
ended March ended March 31,
31, 2007 2006
Profit as reported (net off preference dividend and tax 19,039.71 13,681.00
thereon)
Add: Employee stock compensation under intrinsic value 987.16 353.49
method
Less: Employee stock compensation under fair value 936.26 291.51
method
Proforma profit (net off preference dividend and tax 19,090.61 13,742.98
thereon)
Earnings per share
Basic
- As reported 11.01 9.36
- Pro forma 11.04 9.40
Diluted
- As reported 10.51 8.84
- Pro forma 10.54 8.88
Nominal value 10.00 10.00

17. Securitisation/ Direct assignment

The Company sells loans through securitisation and direct assignment. The information on
securitisation & direct assignment activity of the Company as an originator for the year March 31, 2007
and March 31, 2006 is given below:

For the year For the year ended

ended March 31, March 31, 2006
2007
Total number of loan assets securitized/directly
68,204 26,886
assigned
Total book value of loan assets securitized/directly
285,979.49 64,886.20
assigned (Rs. in lacs)
Sale consideration received for the securitized/directly
311,095.04 70,020.42
assigned assets (Rs. in lacs)
Gain on account of securitization/direct assignment*
29,070.05 5,664.25
(Rs. in lacs)

The information on securitisation & direct assignment activity of the Company as an originator as on
March 31, 2007 and March 31, 2006 is given in the table below :

As at March As at March
31, 2007 31, 2006
Outstanding credit enhancement 31,095.67 4,054.25
Outstanding liquidity facility 2,236.77 Nil
Outstanding subordinate contribution 6,199.80 Nil

F-156
* Gain on securtisation deals done after February 1, 2006 is amortised over the period of the loan

18. Derivative Instruments :

The Notional principal amount of derivative transactions outstanding as on March 31, 2007 for
principal swaps are Rs. 60,000 lacs (March 31, 2006 - Nil) and for interest rate swaps Rs..Nil
(March 31, 2006 – Rs.18,000 lacs)

19. Accounting for assignment of loan portfolio

Till March 31, 2006, the Company assigned various loan portfolios (on recourse basis) to banks.
The Company, while accounting for such assignment, had transferred out from the books of
account all individual loan accounts assigned and had also accounted for profit / loss on
assignment in the year the portfolio was assigned. However, during the current year, the
Company has reinstated all loan balances in the books of account and has also accounted for the
amounts payable to the banks as Secured Loans including for loans assigned during the prior
years. The Company has also reversed the proportionate profit so accounted at the time of loan
assignment. This has resulted in an increase in hypothecation loans by Rs. 5,855.72 lacs,
increase in Secured loans by Rs. 6,233.49 lacs, reversal of proportionate profit by Rs. 1,131.29
lacs, accounting for interest income on such loan portfolio by Rs. 1,872.11 lacs and accounting
for interest expense on secured loans by Rs. 1,030.62 lacs. As all amounts payable to the banks
have been accounted in the books of account, there is no contingent liability on account of loan
portfolio assigned to the banks as at March 31, 2007.

20. Supplementary Statutory Information

(Rs. in lacs)

20.1 Managing Director’s Remuneration

2007 2006*
Salaries 6.10 18.88
Perquisites 1.30 4.12
Contribution to Provident fund 0.09 0.27
Employee stock option scheme 12.83 5.97
20.32 29.24
Note: - As the future liability for gratuity and leave encashment is provided on an actuarial
basis for the Company as a whole, the amount pertaining to the directors is not ascertainable
and, therefore, not included above.
The computation of profits under section 349 of the Act has not been given as no commission
is payable to the Directors / Managing Director
* Includes remuneration paid to Managing Directors of merged Companies.

(Rs. in lacs)
20.2 Expenditure in foreign currency (On cash basis)
2007 2006
Travelling 3.40 5.25
Others Nil Nil
3.40 5.25

F-157
20.3 Net dividend remitted in foreign exchange

Period to which it relates 1.4.2006 1.4.2005

to to
31.3.2007 31.3.2006

Number of non-resident shareholders 3 2

Number of equity shares held on which dividend was due 65,930,547 60,635,664
Amount remitted (state the foreign currency)
Euro 113,889 182,646
American Dollar 2,109,340 1,478,242
Yuan 13,652 Nil

21. The Company is engaged in generating power out of windmills. The details are as under:
For the year For the
ended year ended
March 31, March 31,
2007 2006
Not Not
Licensed Capacity
Applicable Applicable
Installed Capacity (kwh) 22,430 23,180
Units Generated(net of Captive consumption) 36,013,398 36,242,528
Units Sold 36,013,398 36,242,528
Sale Value (Rs. in lacs) 1,130.66 1,117.99

22. Additional information with regard to other matters specified in paragraph 4A & 4D of Part II
of Schedule VI of the Act are not applicable

23. Based on the information and records available with the Company, there are no amount
outstanding as payable for more than 30 days to any small scale industrial undertakings.
(Previous year: Rs. NIL)

24. During the year the Company incorporated a 100% subsidiary by name Shriram Powergen Limited
to exclusively deal with the windmill and the bio-mass projects of the company. The certificate of
incorporation of the subsidiary was obtained on 08.02.2007 and the certificate of commencement
of business has been applied for.
Consequently, its accounts were not prepared and audited as at 31.03.2007. Hence, the
consolidated accounts were not presented.

25. Previous Year Comparatives

Previous year’s figures have been regrouped and reclassified, wherever necessary to conform
to current year’s classification.

F-158
Notes to Accounts for the year 2005 - 2006

A) Balance Sheet
1) SECURED LOANS

a) (i) Privately placed Redeemable Non-convertible Debentures of Rs.1,000/- each

As at March 31, As at March

2006 31, 2005
Number 17,443,008 8,655,836
Amount Rs in Lacs 174,430.08 86,558.36

Secured by mortgage of office premises, charge on Plant and Machinery, Furniture and other fixed assets
of the Company, charge on Company’s book debts, leased assets, lease rentals including future
receivables, loans, advances and other investments of the company subject to prior charges created or to
be created in favour of the Company’s bankers, Financial institutions and others.

Debentures are redeemable over a period of 6 months to 160 months from the date of allotment
depending on the terms of the agreement.

(ii) Redeemable Non-Convertible Debenture of Rs.10,00,000/- each

As at March 31, As at March

2006 31, 2005
Number 1000 Nil
Amount Rs in Lacs 10,000.00 Nil

Secured by hypothecation of specific assets covered under Loan agreements by way of an exclusive
charge.

Debentures are redeemable on 19th September, 2007 as per the terms of the agreement.

F-159
 (Rs. in lakhs)

As on As on
b) Term Loans: 31.03.2006 31.03.2005

i. From Financial Institutions / Corporate:

a) Secured by an exclusive charge by way of 34,839.13 13,400.65

hypothecation of specific movable assets
being Fixed / Current assets relating to Lease
and Hire Purchase Agreements.

b) Secured by an exclusive charge by way 2,322.08 2,590.44

of Hypothecation of specific immovable/
movable assets pertaining to the wind farm.

c) Secured by an exclusive charge by way of 1,326.66 -

Hypothecation of specific immovable /
movable assets pertaining to the wind farm
and Guaranteed by a former Director

ii. From Foreign Institution : 5,069.87 3,259.20

by way of hypothecation of specific

Hire Purchase agreements and all
amounts owing to and received by the
Company pursuant to the above
Hire Purchase Agreements

iii. From Banks:

a) Secured by hypothecation of vehicle 11.62 1.35

b) Secured by an exclusive charge by 87,216.72 21,031.04

way of hypothecation of specific
movable assets being Fixed / Current
assets relating to Lease, Hypothecation
Loans and Hire -Purchase Agreements/
Loan agreements

c) Secured by an exclusive charge by way 1,661.71 -

of hypothecation of specific immovable/
movable assets pertaining to the windfarm
and Guaranteed by a former Director.

d) Secured by an exclusive charge by way of 2,392.79 -

hypothecation of specific immovable/movable
assets pertaining to the bio mass plant.

F-160
 As on As on

31.03.2006 31.03.2005
c) Cash Credit from Banks: 54,820.74 3,157.91

Secured by hypothecation of specific assets

covered under Hire-Purchase/Lease/Loan
Agreements, Book debts, equitable mortgage
of title deeds of the immovable property and
guaranteed by Former Director of the Company.

d) HP Refinance Loan:

From Institutions / Corporates: 110.39 -

Secured by Hypothecation of Vehicles by
hirers guaranteed by associate concerns
and also by a former Director of the company

2) Subordinated Debt :

The Company has raised Tier II capital by issue of Subordinated Debt bonds amounting to Rs.
13,225.77 lakhs (Previous Year – Rs.9,401.10 lakhs) with coupon rate of 8 % to 11% per annum which
are redeemable over a period of 63 months to 80 months.

3) Details of Deferred Tax Liability :

Rs In lakhs
As on As on
31.03.2006 31.03.2005

Depreciation 12,328.80 5,010.07

Others 1,040.05 339.91

4) Contingent Liabilities in respect of :

Guarantees issued by the Company to Banks 22,035.68 2,628.82

(Out of which amount outstanding) 1,621.55 411.04
Guarantees issued by the Company to Others 815.10 3,779.90
(Out of which amount outstanding) 131.13 360.33
In respect of Securitised assets 29,742.84 11,994.20
In respect of portfolio management 1,123.63 1,846.28

Disputed Income Tax/Interest Tax demand contested in appeals not provided for Rs. 5,318.72 lakhs
(Previous Year Rs.2,693.26 lakhs) against which a sum of Rs.268.79 lakhs (Previous Year
Rs.173.44 lakhs) has been paid under protest which appears under advances recoverable in cash or in
kind. In the opinion of the management there is no contingent liability, for the said disputed tax
demand in view of favourable appellate decisions in the company’s own cases in the earlier years.

F-161
5) Disclosure as per Accounting Standard -19 ‘Leases’ :

In case of assets given on lease

The Company has given land and building on operating lease for period ranging 11 months to 60
months.

Financial Lease ( including Hire Purchase loans after 01/04/2001)

(Rs. in lakhs)
As on 31st March RECEIVABLE IN
2006
Not Later than 1 Year Later than 1 Year Later than
but not later than 5 Years
5 Years

Gross Investment 79,597.53 48,597.94 30,999.59 -

LESS
Unearned Income 19,583.19 12,045.95 7,537.24 -

Net Present Value 60,014.34 36,551.99 23,462.35 -

6) 53,88,350- Cumulative Redeemable Preference Shares (including 28,28,220 preference shares of

amalgamating company SIL and 29,480 preference shares of amalgamating company SOFL) were
redeemed during the year prior to the scheduled redemption date, as per the terms of the issue and
equivalent amount is appropriated towards Capital Redemption Reserve.

B) General:

i. The Company has issued 1,60,00,000 Warrants on Preferential basis with an option to
convert into Equity Shares of Rs.112/- each including Premium of Rs.102/- within 18
months from the date of issue i.e. 02.02.2006.

ii. In the opinion of the Management, Sundry Debtors, Current Assets and Loans and Advances
have a value on realisation in the ordinary course of business at least equal to the amount at
which they are stated.

iii. Recovery of Service Tax on Lease and Hire Purchase Transactions is kept in abeyance in
view of the stay granted by Madras High Court. If any Liability arises it will be recovered
from the concerned parties. However, pending decision from the Madras High Court,
Service Tax is provided for on termination of contracts.

F-162
iv. In view of uncertainty as to measurability and collectability, additional finance charges are
treated to accrue only on realization which were accounted for as per the terms of agreement
till the previous year. Had the earlier accounting policy been continued, the income from
operations for the year would have been higher by Rs.1,941.09 lakhs.

v. Gain or loss arising on securitization / direct assignment up to 31st January 2006 being
difference between book value of securitised assets and consideration for the same has been
recognized in the year of transfer of such assets. In case of securitization / direct assignment
of assets done thereafter, the income is recognized over the tenure of agreements as per the
RBI Guidelines. Had the earlier accounting policy been followed, the income from
operations for the year would have been higher by Rs. 488.09 lakhs.

vi. Employee Stock Option Scheme (ESOS)

In October 2005, pursuant to the approval of shareholders at the Extraordinary General Body
Meeting, the Company approved an Employee Stock Option Scheme (ESOS). Under the
scheme, the Company is authorized to issue up to 63,03,094 (including 30,31,667 shares for
employees of amalgamating company i.e. Shriram Investments Limited) equity shares to
eligible employees. Eligible employees are granted an option to purchase shares subject to
vesting conditions. The options vest in a graded manner over four years. The options can be
exercised within ten years from the date of vesting. 29,62,500 options have been granted
under the scheme till the year ended 31st March 2006.

The Company has adopted intrinsic value method in accounting for employee cost on
account of ESOS. The value of shares Rs.110.10 (for amalgamating company i.e. Shriram
Investments limited it is Rs. 103.84) is worked out based on the market prices at the time of
grant. The difference between the market value and the exercise price of Rs. 35/- is being
amortised as employee compensation cost over the vesting period. Commencing from the
date of grant i.e. 31st October 2005 the total amount to be amortised over the vesting period
is Rs. 2,120.92 lakhs.

Accordingly the charge to Profit & Loss account during the current year is Rs. 353.49 Lakhs
whereas amount to be provided in future is Rs.1,767.43 Lakhs.

Stock option activity under the scheme is set out:

As at 31st March 31st March
2006 2005
Stock Option outstanding at the beginning of the year Nil Nil
Granted during the year 29,62,500 Nil
Forfeited during the year Nil Nil
Exercised during the year Nil Nil
Stock Options outstanding at the end of the year 29,62,500 Nil

Vesting period in years Expected Vesting

1 296,250
2 592,500
3 888,750
4 1,185,000

F-163
vii. Earning Per Share

For the year ended

Particulars Unit March March
2006 2005
Basic
Weighted Average No. of Shares Outstanding Nos.(Lakh) 1,461.41 515.72
Profit after Tax & Preference Div and tax Rs. in Lakh 13,681.00 4674.35
thereon
Earning Per share (Face value of Rs.10/- per (Rs.) 9.36 9.06
share)
Diluted
Optionally Convertible Warrants Nos.(Lakh) 82.58 3.58
Employee Stock Option Scheme Nos.(Lakh) 3.39 Nil
Weighted Average No. of Shares Outstanding Nos.(Lakh) 1,547.38 519.30
Earning Per share (Face value of Rs.10/- per (Rs.) 8.84 9.00
share)
Reconciliation of basic and diluted shares
used in computing EPS
Number of shares considered as basic Nos.(Lakh) 1,461.41 515.72
Weighted Average Shares outstanding
Add: Effect of Optionally Convertible Nos.(Lakh) 82.58 3.58
Warrants
Add: Effect of ESOS Nos.(Lakh) 3.39 Nil
Number of shares considered as diluted Nos.(Lakh) 1,547.38 519.30
Weighted Average Shares and potential
shares outstanding

viii) Related Party Transactions :

i) Items Enterprises having significant influence over the Company
Shriram Financial Services Holding Shriram Holdings (Madras)Pvt Ltd
Pvt Ltd
31st March 2006 31st March 2005 31st March 2006 31st March 2005
Payments/Expenses
Royalty 212.35 81.3 - -
Data Sourcing Fees 114.67 39.01 - -
Services Charges 688.02 156.51 - -
Equity Dividend 0.25 237.77 1,257.57 7.13
Preference Dividend 418.39 216.67 - -
Redemption of 5,147.93 - - -
Preference Share
Capital
Receipts/Income
Sale of Assets 127.24 - - -
Subscription of - - 30,687.67 -
Equity shares
Subscription to
Optionally - - 1,792.00 -
Convertible Warrants

F-164
ii) The Salary & Perquisites paid to the Managing Director for the current year is Rs.29.24 lakhs
(previous year Rs. 6.39 lakhs) includes Rs.5.97 lakhs arising out of ESOS, Rs 4.77 lakhs paid
to the Managing Director of Shriram Investments Limited and Rs. 9.63 lakhs paid to Managing
director of Shriram Overseas Finance Limited.

ix) Segment Reporting:

The Company is engaged primarily in the business of financing and accordingly there are no
separate reportable segments as per Accounting Standard 17 ‘Segment Reporting’ issued by
The Institute of Chartered Accountants of India.

x) The exchange risk on principal and interest amount on foreign currency loan from Foreign
Institution has been hedged with a Banker and the liability has been converted into Indian
Rupees.

xi) The Company is in the process of creating floating charge on its Statutory Liquid Assets in
favour of its depositors as required by Reserve Bank of India.

F-165
 (Rs. in lakhs)
Year ended Year ended
31.03.2006 31.03.2005

xii) Remuneration to Managing Director

(Including Remuneration paid to Managing directors of
Amalgamating companies viz; SIL and SOFL)

Salary(including ESOS) 25.12 5.48

Perquisites/Payments 4.12 0.91

xiii) Expenditure in Foreign Currency 5.25 5.31

xiv) The Company does not have any dues payable to Small Scale Industrial units.

xv) The Company is engaged in generating power out of windmills .The details are as under:

Year ended Year ended

31.03.2006 31.03.2005

Licensed Capacity Not applicable Not applicable

Installed Capacity 23,180 kwh 8,650 kwh
Units Generated
(Net of captive consumption) 36,242,528 1,4635,956

Units Sold 3,6242,528 1,4635,956

Sale Value ( Rs. in lakhs) 1,117.99 491.73

xvi) Other particulars as per clauses 4(c) & (d) of Part II of Schedule VI are not furnished, since the
same are not applicable.

xvii) Expenses in respect of common branches and infrastructure are shared by the Company with
other Companies and are booked under respective expenditure heads.

xviii) Estimated amount of contracts remaining to be executed on capital account and provided for (net
of advances paid) Rs. 791.40 Lakhs (Previous year Rs. 100 lakhs)

xix) Borrowing costs aggregating to Rs. 62.01 lakhs (Previous year Nil) being interest and other costs
on specific term loan from a bank for Bio Mass Plant under construction have been capitalized
during the year and are included in ‘Capital Work in Progress’.

xx) Derivative Transactions:

• There are 6 (Previous Year – Nil ) Derivative instruments for hedging interest rate
risk outstanding as on 31st March 2006.

• The foreign currency exposures that are not hedged by a derivative instrument or
otherwise is Nil. ( Previous Year – Nil )

F-166
xxi) Amalgamation

a) Shriram Investments Limited (SIL) and Shriram Overseas Finance Limited (SOFL) both
Non Banking Financial Companies were amalgamated with the Company with effect from
01.04.2005 in accordance with the Order of the Hon’ble High Court of Judicature of Madras
dated 25.11.2005 and 01.12.2006 respectively.

Shriram Reckon Trucks Ltd. was merged with Shriram Overseas Finance Ltd. with effect
from 1st April 2005 as per the Orders of the Hon’ble High Court of Judicature of Madras
dated 14.07.2006 and the Hon’ble High Court of Judicature of Bombay dated 18.08.2006.

The business of SIL and SOFL primarily comprises financing of Commercial Vehicles.

The amalgamations have been accounted for under the “Pooling of Interests method” in
accordance with Accounting Standard (AS)14 – “Accounting for Amalgamations” issued by
ICAI.

b) The schemes of amalgamation have been given effect to in the accounts. The assets and
liabilities of SIL and SOFL have been transferred to and vest with the company with effect
from 01.04.2005.

c) The equity shareholders of SIL are entitled to 1 Equity share of Rs. 10/- each in the
Company for every Equity share of Rs 10/- each held in SIL. Accordingly 6,06,33,350
Equity Shares of Rs. 10/- each amounting to Rs 6,063.33 lakhs were allotted to the
shareholders of SIL.

d) The shareholders of SOFL are entitled to 6 shares of Rs 10/- each in the Company for every
10 Equity shares of Rs 10/- each held in SOFL. Accordingly 1,86,45,886 Equity Shares of
Rs.10/- each (including fractional entitlements) amounting to Rs.1864.59 lakhs are to be
allotted to shareholders of SOFL and has been reflected in the balance sheet under “Equity
Share Capital Suspense Account”. The dividend payable on these shares @ 30% and tax on
distributed profits has been provided for, pursuant to the scheme of amalgamation.

As per the scheme of amalgamation the transferee company shall allot the new shares to a
Trust/ Director or Officer of transferee company against the fractional entitlements of
transferor company’s (i.e. SOFL ) shareholders. These shares shall be held by such Trust/
Director/ Officer for and on behalf of such shareholders and will be sold at appropriate time
and price. The net sale proceeds shall be distributed among the shareholders in proportionate
to their shareholdings.

e) The amount of Rs 1,243.06 lakhs being the difference between the paid up Equity share
capital of amalgamating company i.e. SOFL and the paid up value of shares issued to SOFL
share holders is shown under “General Reserve” in accordance with the scheme of
amalgamation as approved by the Honourable High Court of Judicature of Madras.

f) The figures of the current year includes figures of amalgamating companies viz; Shriram
Investments Limited and Shriram Overseas Finance Limited. Therefore, the figures of the
current year are not comparable with those of the previous year.

xxii) Figures for the previous year have been regrouped/rearranged wherever necessary to conform
to the classification of the current year.

F-167
Notes to Accounts for the year 2004 - 2005

1) SECURED LOANS

a) Privately placed Redeemable Non-convertible Debentures:

As on
31.03.2005

Redeemable Non-Convertible Debentures (Number) 8,655,836

of Rs.1000/- each (Amount in lakhs) 86,558.36

Secured by mortgage of office premises, charge on Plant and Machinery, Furniture and other fixed assets
of the Company, charge on Company’s book debts, leased assets, lease rentals including future
e receivables, loans, advances and other investments of the company subject to prior charges created or
to be created in favour of the Company’s bankers, Financial institutions and others.

Debentures are redeemable over a period of 6 months to 160 months from the date of allotment
depending on the terms of the agreement.

(Rs. in lakhs )
As on
b) Term Loans: 31.03.2005

i. From Financial Institutions / Corporate:

a) Secured by an exclusive charge by way of 13,400.65

hypothecation of specific movable assets
being Fixed / Current assets relating to
Lease and Hire Purchase Agreements.

b)Secured by an exclusive charge by way 2,590.44

of Hypothecation of specific immovable/
movable assets pertaining to the windfarm.

ii. From Foreign Institution : 3,259.20

Secured by an exclusive charge by way of
hypothecation of specific Hire Purchase
agreements and all amounts owing to and
received by the Company pursuant to the
above Hire Purchase Agreements

iii. From Banks:

a) Secured by hypothecation of vehicle 1.35

b) Secured by an exclusive charge by way 21,031.04

of hypothecation of specific movable
assets being Fixed / Current assets
relating to Lease, Hypothecation Loans
and Hire –Purchase / Loan agreements

F-168
 c) Cash Credit from Banks: 3,157.91

Secured by hypothecation of specific assets covered under Hire-Purchase/Lease/Loan Agreements, Book

debts and guaranteed by Former Director of the Company.

2) Subordinated Debt :

The Company has raised Tier II capital by issue of Subordinated Debt bonds amounting to Rs.9,401.10
lakhs with coupon rate of 8 % to 11% per annum which are redeemable over a period of 63 months to 80
months.

3) Contingent Liabilities in respect of :

(Rs. in lakhs)
as on
31.03.2005

Guarantees issued by the Company to Banks 2,628.82

(Out of which amount outstanding) 411.04
Guarantees issued by the Company to Others 3,779.90
(Out of which amount outstanding) 360.33
Inrespect of Securitised assets 11,994.20
Inrespect of portfolio management 1,846.28

Disputed Income Tax/Interest Tax demand contested in appeals not provided for Rs. 2,693.26
lakhs against which a sum of Rs.173.44 lakhs has been paid under protest which appears under
advances recoverable in cash or in kind. In the opinion of the management there is no contingent
liability, for the said disputed tax demand in view of favourable appellate decisions in the company’s
own cases in the earlier years.

4) Disclosure as per Accounting Standard – 19:

On Financial Lease
(Rs.in lakhs)
As on 31st March RECEIVABLE IN
2005
Not Later than 1 Year Later than 1 Year Later than
but not later than 5 Years
5 Years

GROSS INVESTMENT 36,424.63 15,468.16 20,956.47 -

LESS
UNEARNED INCOME 10,999.45 5,637.11 5,362.34 -

NET PRESENT VALUE 25,425.18 9,831.05 15,594.13 -

F-169
 On Hire Purchase (for Agreement entered from 01/04/2001)

(Rs.in lakhs)
As on 31st March RECEIVABLE IN
2005
Not Later than 1 Year Later than 1 Year Later than
but not later than 5 Years
5 Years
GROSS INVESTMENT 32,745.78 17,243.06 15,502.72 -

LESS
UNEARNED INCOME 9,061.00 4,002.48 5,058.52 -

NET PRESENT VALUE 23,684.78 13,240.58 10,444.20 -

5) General :

i) The Company has issued 29,66,000 Warrants on Preferential basis with an option to convert
into Equity Shares of Rs.35/- each including Premium of Rs.25/- within 18 months from the
date of issue i.e 16.02.2005.

ii) The levy of Sales tax on lease transactions has been challenged in writ proceedings. The
liability, if arises, will be recovered from the concerned lessees. There are no demands
outstanding.

iii) In the opinion of the Board of Directors, the Sundry Debtors, Current Assets and Loans and
Advances have a value on realisation in the ordinary course of business atleast equal to the
amount at which they are stated.

iv) Recovery of Service Tax on Lease and Hire Purchase Transactions is kept in abeyance in
view of the stay granted by Madras High Court. Liability if arises will be recovered from
the concerned parties. However, Service Tax recoverable is written off on termination of a
contract.

F-170
 v) Earning Per Share

For the year

ended
Particulars Unit March
2005
Basic
Opening No. of Shares Nos.(Lakh) 418.99
Total No. of Shares Outstanding Nos.(Lakh) 654.28
Weighted Average No. of Shares Outstanding Nos.(Lakh) 515.72
Profit after Tax Rs. in Lakh 4,674.35
Earning Per share (Face value of Rs.10/- per (Rs.) 9.06
share)
Diluted
Optionally Convertible Warrants Nos.(Lakh) 3.58
Weighted Average No. of Shares Outstanding Nos.(Lakh) 519.30
Earning Per share (Face value of Rs.10/- per (Rs.) 9.00
share)
Reconciliation of basic and diluted shares
used in computing EPS
Number of shares considered as basic Nos.(Lakh) 515.72
Weighted Average Shares outstanding
Add: Effect of Optionally Convertible Nos.(Lakh) 3.58
Warrants
Number of shares considered as diluted Nos.(Lakh) 519.30
Weighted Average Shares and potential
shares outstanding

vi) Related Party Transactions:

Key Personnel :

Managing Director : Mr.R. Sridhar

Remuneration : Rs. 6.39 Lakhs

vii) Segment Reporting:

The Company is engaged primarily in the business of financing and accordingly there are no separate
reportable segments as per Accounting Standard 17 issued by The Institute of Chartered
Accountants of India.

viii) Deferred Tax liability arising on account of timing difference comprising of Depreciation, Lease
Adjustments, Additional Finance Charges, Deferred Revenue Expenses and other items has been
provided in accordance with Accounting Standard 22 issued by The Institute of Chartered
Accountants of India.

ix) Principle amount of foreign currency loan from Foreign Institution and Interest payable thereon has
been hedged with a Banker.

F-171
 x) The Company is in the process of creating floating charge on its Statutory Liquid Assets in favour of
its depositors as required by Reserve Bank of India.

xi) Charge has been created by way of equitable mortgage of title deeds for Rs.100 lakhs on the
immovable property of the Company in favour of a bank in respect of credit facility sanctioned
to an Associate Company.

(Rs. in lakhs)
Year ended
31.03.2005

xii) Remuneration to Managing Director

Salary 5.48
Perquisites/Payments 0.91
xiii) Expenditure in Foreign Currency 5.31

xiv) The Company does not have any dues payable to Small Scale Industrial units.

xv) The Company is engaged in generating power out of windmills .The details
are as under:
Year ended
31.03.2005

Licensed Capacity Not applicable

Installed Capacity 8,650 kwh
Units Generated
(Net of captive consumption) 14,635,956 Units

Units Sold 14,635,956 Units

Sale Value (in Rs.) 491.73 lakhs .

xvi) Other particulars as per clauses 4(c) & (d) of Part II of Schedule VI are not furnished, since the same
are not applicable.

xvii) The expenses in respect of Common offices and infrastructure of various Companies are shared by
the company as certified by the Management of the respective companies.

xviii) Estimated amount of contracts remaining to be executed on capital account not provided for (net of
advances paid) Rs. 100 lakhs

xix) The auditors’ report dated June 28, 2005 on financial statements as of and for year ended March
31,
2005 included, as an Annexure, a statement on certain matters specified in the Companies (Auditors
Report) Order, 2003, which was modified to indicate that there was an instance of fraud on the
Company by its employees and default in repayment of dues to two financial institutions.

F-172
Schedules annexed to and forming part of the accounts
As required in terms of Paragraph 13 of Non-Banking Financial (Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007
(Rs. In Lacs )
Particulars As on 31.03.2010 As on 31.12.2009 As on 31.03.2009 As on 31.03.2008 As on 31.03.2007 As on 31.03.2006 As on 31.03.2005
Liabilities
side :
1 Loans and Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
advances outstanding overdue outstanding overdue outstanding overdue outstanding overdue outstanding overdue outstanding overdue outstanding overdue
availed by
the NBFCs
inclusive of
interest
accrued
thereon but
not paid:
(a)
Debenture :
Secured 532,889.57 6,391.77# 605,122.51 7,500.70 536,055.62 6,073.49# 353,719.95 7,305.65# 213,834.11 2,835.23# 218,762.61 3,861.88# 101,793.72 1,948.62#
Unsecured
(other than
falling
within the
meaning of
public
deposits*) 2,604.10 - 2,541.22 - 2,631.34 - 4,053.71 - 13,184.44 - 10,490.59 - 2,521.66 -
(b) Deferred
Credits - - - - - - - - - - - - - -
(c) Term
Loans 1,019,523.94 - 1,119,624.02 - 939,062.12 - 777,522.88 - 421,006.01 - 150,899.23 - 40,440.53 12.71
(d) Inter-
corporate
loans and
borrowing 16.75 - 25.09 - 4,811.04 - 124.11 - 30.00 - 33.05 - 15.00 -
(e)
Commercial
Paper 2,500.00 - 2,500.00 - 48,250.00 - 21,695.00 - 34,000.00 - - - - -
(f) Public
Deposits* 11,782.22 81.64# 8,506.54 90.40 613.10 85.95# 472.36 68.95 # 1,315.55 81.13# 1,783.97 138.69# 1,388.26 126.30#
(g) Other
Loans -
Subordinate
Debts 241,998.07 150.06# 224,339.82 70.96 177,778.76 817.05# 112,526.59 - 73,948.59 - 41,067.82 - 12,829.10 -
- Cash
Credit 92,056.13 - 349,092.63 - 316,623.70 - 225,646.66 - 104,118.36 - 54,820.74 - 3,157.91 -
- HP
Refinance
Loan - - - - - - - - - - 110.39 - - -
- Corporate
Loan 35,000.00 - 35,000.00 - 71,000.00 - 46,000.00 - 47,166.10 - 332.20 - - -

F-173
*Please see Note 1 below

Particulars As on 31.03.2010 As on 31.12.2009 As on 31.03.2009 As on 31.03.2008 As on 31.03.2007 As on 31.03.2006 As on 31.03.2005

2 Break-up Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount
of (1)(f) outstanding overdue outstanding overdue outstanding overdue outstanding overdue outstandin overdue outstanding overdue outstanding overdue
above g
(Outstandi
ng public
deposits
inclusive of
interest
accrued
thereon but
not paid):

(a) In the
form of
Unsecured
debentures - - - - - - - - - - - - - -
(b) In the
form of
partly
secured
debentures
i.e
debentures
where there
is a shortfall
in the value
of security
- - - - - - - - - - - - - -
(c) Other
public
deposits 11,782.22 81.64# 8,506.54 90.40 613.10 85.95# 472.36 68.95 # 1,315.55 81.13# 1,783.97 138.69# 1,388.26 126.30#
*Please see Note 1 below
# Represent amounts unclaimed

F-174
 Assets side :

Amount outstanding Amount outstanding Amount outstanding Amount outstanding Amount outstanding Amount outstanding Amount outstanding

3 Break-up of
Loans and
Advances
including bills
receivables
(other than
those
included in
(4) below ):
(a) Secured 1,224.47 1,253.67 1,336.80 2,178.12 4,343.55 5,244.18
3,135.44
(b) Unsecured - - - - - - -

Particulars As on 31.03.2010 As on 31.12.2009 As on 31.03.2009 As on 31.03.2008 As on 31.03.2007 As on 31.03.2006 As on 31.03.2005

4 Break up of Amount outstanding Amount outstanding Amount outstanding Amount outstanding Amount outstanding Amount outstanding
Leased Assets
and stock on
hire counting
towards AFC
activities
(i) Lease
assets
including lease
rentals under
sundry debtors
:
(a) Financial
lease - - - 7,042.41 22,040.19 39,493.12 25,621.31
(b) Operating
lease - - - - - - -
(ii) Stock on
Hire including
hire charges
under sundry
debtors :
(a) Assets on
hire - - - - 5,665.49 27,314.38 28,692.92
(b)
Repossessed
Assets - - - - - - 5.78
(iii) Other
loans counting
towards AFC
Activities :

F-175
 (a) Loans
where assets
have been
repossessed - - - - 56.23 159.48 4.86
(b) Loans
other than (a)
above 1,795,150.46 2,152,660.42 1,793,607.31 1,502,170.33 793,068.46 464,748.27 100,614.10
5 Break-up of Amount outstanding Amount outstanding Amount outstanding Amount outstanding Amount outstanding Amount outstanding Amount outstanding
Investments :
Current
Investments :
1. Quoted :
(I) Shares :
(a) Equity 240.00 240.00 240.00 - - - -
(b) Preference
- - - - - - -
(ii) Debenture
and Bonds - - - - - - -
(iii) Units of
mutual funds - - - - - - -
(iv)
Government
Securities - - - - - - -
(v) Others
(Please - - - -
specify)
Particulars As on 31.03.2010 As on 31.12.2009 As on 31.03.2009 As on 31.03.2008 As on 31.03.2007 As on 31.03.2006 As on 31.03.2005
2. Unquoted :
(I) Shares:
(a) Equity - - - - 4.99 - -
(b)
Preference - - - - - - -
(ii) Debentures
and Bonds - - - - - - -
(iii) Units of
mutual funds - - - - 20,614.74 - -
(iv)
Government
Securities - - - - - - -
(v) Others -
Investment in
Certificate of
Deposits 177,146.92 121,772.67 62,413.82 136,932.08 - - -
Long Term
investments :
1. Quoted :

(I) Shares :
(a) Equity - - - 240.00 240.71 243.62 120.00
(b) Preference - - - - - - -

F-176
 (ii) Debentures
and Bonds - - - - - 5.03 5.00
(iii) Units of
mutual funds - - - - - - -
(iv)
Government
Securities 3,497.70 3,053.81 283.00 427.44 592.29 592.34 272.78
(v) Others
(Please
specify) - - - - - - -
2. Unquoted :

(I) Shares:
(a) Equity 422.50 417.49 207.50 162.50 254.36 74.36 9.71
(b) Preference 10.00 10.00 10.00 - - - -
(ii) Debentures
and Bonds - - - - - - -
(iii) Units of
mutual funds - - - - - - -
(iv)
Government - - - - -
Securities - -
(v) Others -
National
Saving
Certificate - - - - 0.07 0.07 -
Others -
Investment in
SOT and
Bharat
Securatisation
Trust -PTC 4,284.55 - 2,322.01 750.00 750.00 - -
6 Borrower As on 31.03.2010 As on 31.12.2009 As on 31.03.09 As on 31.03.08 As on 31.03.07 As on 31.03.06 As on 31.03.05
group-wise
classification
of assets,
financed as in
(3) and (4)
above :
Please see
Note 2 below

F-177
 Category Amount Amount Amount Amount Amount Amount Amount
( Net of provisions ) ( Net of provisions ) ( Net of provisions ) ( Net of provisions ) ( Net of provisions ) ( Net of provisions ) ( Net of provisions )
Secured Unsecured Secured Unsecured Secured Unsecured Secured Unsecured Secured Unsecured Secured Unsecured Secured Unsecur
ed

1. Related
Parties **

(a) -
Subsidiaries - - - - - - - - - - - -
(b) Companies -
in the same - - - - - - - -
group - - - -
( c) Other
related parties -

- - - - - - - - - - -
2. Other than
related parties 1,736,336.24 21,400.80 2,098,960.30 16,917.46 1,768,865.91 2,406.89 1,499,077.24 1,946.23 818,421.50 - 532,054.82 31.07 156,481.05 35.00
7 Investor As on 31.03.2010 As on 31.12.2009 As on 31.03.2009 As on 31.03.2008 As on 31.03.2007 As on 31.03.2006 As on 31.03.2005
group-wise
classification
of all
investments
(current and
long term) in
shares and
securities
(both quoted
and
unquoted):
Please see
note 3 below
Category Market Book Market Book Value Market Book Value Market Book Value Market Book Value Market Book Value (Net of Market Book
Value / Value Value / (Net of Value / (Net of Value / (Net of Value / (Net of Value / Provisions) Value / Value
Break up (Net of Break up Provisions) Break up Provisions) Break up Provisions) Break up Provisions) Break Break up (Net of
or fair Provision or fair or fair or fair or fair up or or fair Provisio
value or s) value or value or value or value or fair value or ns)
NAV* NAV* NAV* NAV* NAV* value NAV*
or
NAV*
1. Related Parties
**
(a) Subsidiaries
213.26 215.00 207.19 209.99 - - - - - 4.99 - - - -

F-178
 (b) Companies in
the same group

- - - - - - - - - - - - - -
( c) Other related
parties 597.60 240.00 612.00 240.00 270.00 240.00 504.00 240.00 360.00 420.00 320.40 58.80 29.40 29.40
2. Other than
related parties
184,915.88 184,899.29 124,784.56 124,795.27 65,051.52 65,009.31 138,151.39 138,126.13 21,192.24 21,931.86 614.40 588.71 301.41 274.24
* Disclosure is made in respect of available information.

** As per Accounting Standard of ICAI (Please see Note 3)

8 Other 31.03.2010 31.12.09 31.03.09 31.03.08 31.03.07 31.03.06 31.03.05

information
Particulars Amount Amount Amount Amount Amount Amount Amount

i Gross Non-
Performing
Assets
(a) Related - - - - - - -
parties
(b) Other than
related parties 51,126.65 52,333.87 38,431.39 23,843.32 17,404.19 6,705.74 2,280.80

ii Net Non-
Performing
Assets
(a) Related - - - - - - -
parties
(b) Other than
related parties 13,908.09 14,274.45 14,746.53 13,553.78 11,015.70 2,340.32 948.65

iii Assets
acquired in - - - - - - -
satisfaction of
debt

Notes :

1. As defined in Paragraph 2(1)(xii) of the Non- Banking Financial (Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007.

2. Provisioning norms shall be applicable as prescribed in the Non- Banking Financial (Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007.

3. All Accounting Standards and Guidance Notes issued by ICAI are applicable including for calculation of investments and other assets as also assets acquired in satisfaction of debt. However, market value in respect of
quoted investments and break up/fair value/NAV in respect of unquoted investments should be disclosed irrespective of whether they are classified as long term or current in (5) above.

F-179
Upto the year ended March 31, 2007

1. As defined in Paragraph 2(1)(xii) of the Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998.

2. Provisioning norms shall be applicable as prescribed in the Non-Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998.

3. All Accounting Standards and Guidance Notes issued by ICAI are applicable including for calculation of investments and other assets as also assets acquired in satisfaction of debt. However, market value in respect of
quoted investments and break up/fair value/NAV in respect of unquoted investments should be disclosed irrespective of whether they are classified as long term or current in (5) above.

F-180
S.R.BATLIBOI & Co. G. D. Apte & Co.
Chartered Accountants Chartered Accountants
6th Floor, Express Tower Dream Presidency
Nariman Point 1202 / 17E Shivajinagar
Mumbai – 400 021 Off Apte Road
Pune - 411 004

Auditors' report

To
The Board of Directors
Shriram Transport Finance Company Limited
3rd Floor, West Wing
Wockhardt Tower
Bandra Kurla Complex
Bandra – East
Mumbai – 400051

Dear Sirs,

1. We S.R.Batliboi & Co. (“SRB”) and G.D.Apte & Co. (“GDA”) have jointly examined the attached Reformatted
Consolidated financial information of Shriram Transport Finance Company Limited (‘Company’), its
subsidiaries and associate (Collectively referred to as “Group”) as at and for the year ended March 31, 2010 and
as at and for the nine months period ended December 31, 2009 approved by an authorized delegate of the Board
of Directors and prepared by the Company in accordance with the requirements of:
a. paragraph B(1) of Part II of Schedule II to the Companies Act, 1956 ('the Act') and
b. the Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 ('the
Regulations') issued by the Securities and Exchange Board of India ('SEBI'), as amended from time to time
in pursuance of the Securities and Exchange Board of India Act, 1992 (the “SEBI Act”).
SRB and GDA are collectively referred to as the "Joint Auditors" and the references to the Joint Auditors as
"we", "us" or "our", in this letter, shall be construed accordingly.
2. We have examined such Reformatted Consolidated financial information taking into consideration:
a. the terms of reference dated March 8, 2010 received from the Company and statement of joint
responsibilities of auditors dated March 8, 2010, requesting us to carry out the assignment, in connection
with the Offer Document (‘OD’) being issued by the Company for its proposed public offer of non-
convertible debentures (‘NCDs’), having a face value and issue price of Rs. 1,000 each (referred to as the
'Offering') and
b. The Guidance Note on Reports in Company Prospectuses (Revised) issued by the Institute of Chartered
Accountants of India.

Reformatted Consolidated financial information as per audited Consolidated financial statements:

3. The Reformatted Consolidated financial information of the Group has been extracted by the management from
the Consolidated balance sheet of the Group as at March 31, 2010 and the related Consolidated profit and loss
account and Consolidated cash flow statement for the year ended March 31, 2010 and the Consolidated balance
sheet as at December 31, 2009, and the related Consolidated profit and loss account and Consolidated cash flow
statement for the period April 1, 2009 to December 31, 2009, (Collectively referred to as the “Audited
Consolidated Financial Statements”) jointly audited by us. We did not audit the financial statements of the
associate company, Shriram Asset Management Company Limited whose financial statements reflect net loss
after tax of Rs. 1,858,829 for the year ended March 31, 2010 and Rs.1,506,443 for the period ended December
31, 2009. These financial statements and other financial information have been audited by other auditors whose
reports have been furnished to us, and our opinion is based solely on the report of other auditors. The financial

F-182
 statements of the subsidiary company, Shriram Asset & Equipment Finance Private Limited that has been
disposed off during the year reflect net loss after tax of Rs. 315,183 for the period June 04, 2009 to December
14, 2009 are unaudited but are duly certified by the management and have been relied upon by us in framing
this report.

4. In accordance with the requirements of Paragraph B of Part II of Schedule II of the Act, the SEBI Regulations,
terms of our engagement agreed with you and statement of joint responsibilities of auditors, we further report
that:
a) The Reformatted Consolidated Summary Statement of Assets and Liabilities and the schedules forming
part thereof, Reformatted Consolidated Summary Statement of Profit and Loss and the schedules forming
part thereof and the Reformatted Consolidated Summary Statement of Cash Flow (‘Reformatted
Consolidated Summary Statements’) of the Group, as at March 31, 2010 and for the nine months period
ended December 31, 2009 jointly examined by us, have been set out in Annexure I to V to this report.
These Reformatted Consolidated Summary Statements in our opinion are appropriate and more fully
described in Significant Accounting Policies and Notes (Refer Annexure XIII)
b) Based on the above we state that:

the Reformatted Consolidated Summary Statements have to be read in conjunction with the notes
given in Annexure XIII;

there are no extraordinary items which need to be disclosed separately in the reformatted consolidated
summary statements; and

there are no qualifications in the auditors’ reports, which require any adjustments to the reformatted
consolidated summary statements.

5. We have not jointly audited any consolidated financial statements of the Group as of any date or for any
period subsequent to March 31, 2010. Accordingly, we express no opinion on the financial position, results
of operations or cash flows of the Group as of any date or for any period subsequent to March 31, 2010.

Other consolidated Financial Information:

6. At the Company’s request, we have also examined the following consolidated financial information
proposed to be included in the OD prepared by the management and approved by an authorized delegate of
the Board of Directors of the Company and annexed to this report relating to the Group as at and for the
year ended March 31, 2010 and as at and for the nine months period ended December 31, 2009:

i. Statement of contingent liabilities, enclosed as Annexure VI

ii. Statement of dividend paid/proposed, enclosed as Annexure VII
iii. Statement of accounting ratios relating to earnings per share, net asset value, return on networth,
enclosed as Annexure VIII
iv. Statement of Secured and Unsecured Loans including terms and conditions, enclosed as Annexure IX
&X
v. Capitalization Statement as at March 31, 2010, enclosed as Annexure XI
vi. Statement of tax shelters, enclosed as Annexure XII

7. In our opinion, the reformatted consolidated financial information as disclosed in the annexures to this
report, read with the respective significant accounting policies and notes disclosed in Annexure XIII, as
considered appropriate and disclosed, has been prepared in accordance with Paragraph B(1) of Part II of
Schedule II of the Act and the Regulations.
8. This report should not be in any way construed as a reissuance or redating of any of the previous audit
reports issued by us or by other firm of Chartered Accountants, nor should this report be construed as a new
opinion on any of the consolidated financial statements referred to herein.
9. We have no responsibility to update our report for events and circumstances occurring after the date of the
report for the financial position, results of operations or cash flows of the Group as of any date or for any
period subsequent to March 31, 2010.

F-183
 10. This report is intended solely for your information and for inclusion in the OD in connection with the
Offering of the Company, and is not to be used, referred to or distributed for any other purpose without our
prior written consent.

For S.R.BATLIBOI & Co. For G.D.Apte & Co.

Firm registration number: 301003E Firm registration number: 100515W
Chartered Accountants Chartered Accountants

per Shrawan Jalan per U. S. Abhyankar

Partner Partner
Membership No.: 102102 Membership No.: 113053
Mumbai, May 3, 2010 Mumbai, May 3, 2010

F-184
 Annexure I

Shriram Transport Finance Company Limited

Reformatted Consolidated Summary of Assets and Liabilities
(Rs. in lacs)

As at March As at December
Particulars Schedule
31, 2010 31, 2009

Assets

A Fixed and Intangible Assets (Net) (including 1 4,649.06 4,899.34

CWIP)

B Investments 2 185,561.94 125,460.67

C Deferred Tax Asset (Net) 7,472.94 5,404.50

D Current Assets 3 2,255,469.18 2,662,603.05

E Other Loans & Advances 4 240,958.07 66,500.77

F Total (A+B+C+D+E) 2,694,111.19 2,864,868.33

Liabilities

G Secured Loans 5 1,517,248.07 1,914,975.11

H Unsecured Loans 6 328,742.89 340,637.49

I Current Liabilities 7 390,863.52 249,734.00

J Provisions 8 76,553.35 53,383.85

K Minority Interest - 0.01

L Total (G+H+I+J+K) 2,313,407.83 2,558,730.46

M Net Worth (F-L) 380,703.36 306,137.87

F-185
 Annexure I
Shriram Transport Finance Company Limited
Reformatted Consolidated Summary of Assets and Liabilities
(Rs. in lacs)
Represented By
(i) Share Capital 9 22,554.18 21,279.86
(ii) Share application money pending allotment 5.22 12.97
(iii) Stock Option Outstanding 757.02 1,497.93
(iv) Reserves and Surplus 10 361,095.63 286,890.32
(v) Less : Miscellaneous Expenditure (to the 11 3,708.69 3,543.21
extent not written off or adjusted)
Total (i+ii+iii+iv-v) 380,703.36 306,137.87

The accompanying statement of Significant Accounting Policies and Notes to Accounts on Summary
Financial Statements are integral part of this statement.

As per our report of even date

For S.R.BATLIBOI & Co.
Firm Registration No. 301003E
Chartered Accountants
For G. D. Apte & Co.
Firm Registration No.100515W
Chartered Accountants
For and on behalf of the Board of
Directors of
Shriram Transport Finance Company
Limited

per Shrawan Jalan U. S. Abhyankar R Sridhar S. Venkatakrishnan

Partner Partner Managing Director Director
Membership No. 102102 Membership No. 113053

Mumbai K. Prakash
Vice President (Corporate Affairs) &
Company Secretary

F-186
 Annexure II
Shriram Transport Finance Company Limited
Reformatted Consolidated Summary of Profit and Loss Account
(Rs. in lacs)

For the year ended For the period April

Sched
Particulars March 31, 2010 01, 2009 to December
ule
31, 2009

A Income

i Income from Operations 12 440,282.74 320,857.46

ii Other Income 13 9,685.90 6,185.46

Total Income (A+B) 449,968.64 327,042.92

B Expenditure

i Interest & Other Charges 14 224,678.93 167,377.84

ii Personnel Expenses 16 22,508.15 16,396.29
iii Operating & Other Expenses 17 27,258.49 19,637.47
iv Depreciation and amortisation 1,495.84 1,196.22
v Share & Debenture Issue expenses written off 18 505.63 400.66
vi Provisions & Write offs (net) 19 41,064.86 30,842.97

Total Expenditure 317,511.90 235,851.45

C. Net Profit Before Taxation (A-B) 132,456.74 91,191.47

D. Provision for taxation

Current tax 49,980.20 33,090.61

Deferred tax (4,833.46) (2,765.02)
Total Tax 45,146.74 30,325.59

E. Net Profit after Taxation (C-D) 87,310.00 60,865.88

Share of Losses of Associate
(7.44) (6.02)
F Profit after taxes, Minority Interest and
Share of LossProfit of Associate 87,302.56 60,859.86

F-187
 Annexure II
Shriram Transport Finance Company Limited
Reformatted Consolidated Summary of Profit and Loss Account
(Rs. in lacs)
Balance in Profit & Loss Account brought
forward 58,309.25 58,309.25

G Balance Available for Appropriations

145,611.81 119,169.11

H Appropriations

Equity Shares - Interim dividend 4,254.76 4,254.76

Equity Shares - Final dividend 325.18 325.18

Equity Shares - Proposed final dividend 9,020.71 -

Tax on dividend 778.36 778.36

Tax on proposed dividend 1,498.25 -

Transfer to statutory reserve 17,500.00 -

Transfer to general reserve 8,800.00 -

Transfer to debenture redemption reserve 10,442.08 6,802.27

Total Appropriations
52,619.34 12,160.57

I Balance carried to Balance Sheet (G-H) 92,992.47 107,008.54

The accompanying statement of Significant Accounting Policies and Notes to Accounts on Summary
Financial Statements are integral part of this statement.

F-188
 As per our report of even date
For S.R.BATLIBOI & Co.
Firm Registration No. 301003E
Chartered Accountants
per Shrawan Jalan
Partner
Membership No. 102102
Mumbai
For G. D. Apte & Co.
Firm Registration No.100515W
Chartered Accountants
U. S. Abhyankar
Partner
Membership No. 113053
F-189
For and on behalf of the Board of
Directors of
Shriram Transport Finance Company
Limited
R Sridhar S. Venkatakrishnan
Managing Director Director
K. Prakash
Vice President (Corporate Affairs) &
Company Secretary
 Annexure III
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED
Reformatted Consolidated Cash Flow Statement
(Rs in lacs)

For the year ended March For the period April 01, 2009 to
Particulars
31, 2010 December 31, 2009

A. Cash flow from operating activities

Net profit before taxation 132,456.74 91,191.47

Depreciation and amortisation 1,495.84 1,215.26

Issue expenses for equity shares 25.28 -

Public issue expenses for non convertible
debentures 473.42 394.28

(Profit) / loss on sale of fixed assets (net) (62.40) (88.78)

(Profit) / loss on sale of current and long term
investments (net) (1,812.65) (822.32)
Interest income on current and long term
investments and interest income on fixed (3,179.95) (1,575.34)
deposits
Dividend income (874.71) (874.71)

Employees Stock option compensation cost 341.30 292.00

Provision for credit loss on securitisation 7,971.84 3,317.30

Provisions for non performing assets and bad
debts written off 33,622.02 27,901.02

Provision for gratuity 148.71 119.91

Provision for leave encashment 146.44 119.59

Provision for diminution in value of
investments 20.34 21.67
Operating profit before working capital 170,772.22 121,211.35
changes
Movements in working capital:
(Increase) / decrease in current assets:
(Increase) / decrease in inventories 126.81 126.81
(Increase) / decrease in assets under financing
activities (19,813.77) (372,426.81)

(Increase) / decrease in sundry debtors 399.24 399.24

(Increase) / decrease in other current assets (1,008.93) (58,380.86)

(Increase) / decrease in other loans and
advances (201,029.73) (26,197.25)
Increase / (decrease) in current liabilities 185,952.24 38,542.41

F-190
 Annexure III
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED
Reformatted Consolidated Cash Flow Statement
(Rs in lacs)
For the year ended March For the period April 01, 2009 to
Particulars
31, 2010 December 31, 2009
Cash generated from operations 135,398.08 (296,725.11)

Direct taxes paid (net of refunds) (48,629.30) (33,095.56)

Net cash used in operating activities (A) 86,768.78 (329,820.67)

B. Cash flows from investing activities

Investment in Fixed deposits (net) (88,988.21) (62,129.42)

Purchase of fixed assets (629.41) (544.02)

Proceeds from sale of fixed assets 7,973.48 7,944.77

Purchase of Investment (2,501,835.74) (1,418,405.94)

Proceeds from sale of investments 2,383,738.05 1,359,420.61

Interest received on current and long term 2,897.87 2,025.66
investments and interest on fixed deposits
Dividend received 874.71 874.71

Net cash used in investing activities (B) (195,969.25) (110,813.63)

C. Cash Flows from financing activities

Proceeds from issue of equity share capital
including securities premium & Share
application 80,799.14 22,041.21

Increase / (decrease) in bank borrowings (net) (110,368.29) 219,120.27

Increase / (decrease) in long term borrowings
from others (net) (68,604.27) (40,515.12)
Increase / (decrease) in fixed deposits (net) 10,991.07 7,802.15

Increase / (decrease) in subordinate debts (net) 51,823.24 36,906.16

Increase / (decrease) in redeemable non
convertible debentures (net) 408.53 70,550.19
Increase / (decrease) in inter corporate deposits
and commercial papers (net) (50,390.48) (50,382.21)

Issue expenses for equity shares paid (1,414.53) -

Public issue expenses for non convertible
debentures paid (2,690.64) (3,937.49)

Dividend paid (12,720.40) (12,720.40)

Tax on dividend (2,161.83) (2,161.83)

F-191
 Annexure III
SHRIRAM TRANSPORT FINANCE COMPANY LIMITED
Reformatted Consolidated Cash Flow Statement
(Rs in lacs)
For the year ended March For the period April 01, 2009 to
Particulars
31, 2010 December 31, 2009

Net cash from financing activities (C) (104,328.46) 246,702.93

Net increase / (decrease) in cash and cash
equivalents (A + B + C) (213,528.93) (193,931.37)
Cash and Cash Equivalents at the beginning
of the year 461,054.26 461,054.26
Cash and Cash Equivalents at the end of the
year 247,525.33 267,122.89

(Rs in lacs)
Components of Cash and Cash Equivalents As at March 31, 2010 As at December 31, 2009
Cash on hand 7,818.91 2,469.68
Cheques on hand 2,220.79 2,614.89
Remittances in transit 9.48 144.00
With Banks - in Current Account 166,023.34 163,196.32
- in unpaid dividend accounts $ 274.83 294.26
- in fixed deposits (Original
maturity being three months or less) 71,177.98 98,403.74

247,525.33 267,122.89

$ These balances are not available for use by the Company as they represent corresponding unpaid dividend
liability.

As per our report of even date

For S.R.BATLIBOI & Co.
Firm Registration No. 301003E
Chartered Accountants
For G. D. Apte & Co.
Firm Registration No.100515W
Chartered Accountants
For and on behalf of the Board of Directors
of
Shriram Transport Finance Company
Limited

per Shrawan Jalan U. S. Abhyankar R Sridhar S. Venkatakrishnan

Partner Partner Managing Director Director
Membership No. 102102 Membership No. 113053

Mumbai K. Prakash
Vice President (Corporate Affairs) &
Company Secretary

F-192
 Annexure IV

Shriram Transport Finance Company Limited

Schedules to the Reformatted Consolidated Statement of Assets and Liabilities

(Rs. in lacs)

Schedule 1 - Fixed and Intangibles Asset (Net) As at March 31,

As at December 31, 2009
(including CWIP) 2010

ASSETS FOR OWN USE

Tangible Fixed Assets

Building 392.58 394.38

Leasehold Improvements 1,271.41 1,450.25

Furniture & Fixtures 710.65 712.50

Vehicles 73.41 91.68

Land - Freehold 10.18 10.18

Plant and Machinery 1,879.12 1,922.74

Intangible Assets

Software 69.28 78.85

TOTAL (A) 4406.63 4660.58

ASSETS GIVEN ON LEASE

Land 69.75 69.75

Buildings 168.13 169.01

TOTAL (B) 237.88 238.76

Capital WIP (C ) 4.55 -

TOTAL (A+B+C) 4,649.06 4,899.34

F-193
 Annexure IV

Shriram Transport Finance Company Limited

Schedules to the Reformatted Consolidated Statement of Assets and Liabilities

(Rs. in lacs)
Schedule 2 - Investments As at March 31, 2010 As at December 31, 2009

LONG TERM (at cost)

Trade
Shares : Fully paid up
Unquoted - Preference Share
10.00 10.00

Other than trade

Quoted :
Government Securities
3,497.70 3,053.81
Equity Shares (Fully paid up)
- Associates
Cost of investment
240.00 240.00
(including Rs. Nil of Goodwill net of Capital Reserve
arising on consolidation)
Add: - Share of post acquisition profit 175.27 176.69
415.27 416.69
Unquoted :
Equity Shares (Fully paid up)
- Others
207.50 207.50
Investment in Pass Through Certificates
4,284.55 -
CURRENT INVESTMENTS (at lower of cost and
market value)
Other than trade
Unquoted :
Investment in Certificate of deposits with Banks
177,146.92 121,772.67
185,561.94 125,460.67

Book value of Quoted investments 3,737.70 3,293.81

Market value of Quoted investments 4,030.61 3,573.63
Book value of Unquoted investments 181,648.97 121,990.17

F-194
 Annexure IV
Shriram Transport Finance Company Limited

Schedules to the Reformatted Consolidated Statement of Assets

and Liabilities
(Rs. in lacs)

As at March 31, As at December 31,

Schedule 3 - Current Assets
2010 2009
Asset under financing activities (considered good unless
stated otherwise)*
Secured
Hypothecation loans 1,773,740.20 2,135,742.85
Other loans 1,216.58 1,246.77
Unsecured
Unsecured Loans 21,410.26 16,917.57
Advance - Hypothecation loans 128.21 343.63
1,796,495.25 2,154,250.82

* includes non performing assets 51,117.19 52,303.87

Cash & Bank Balances

i) Cash on hand 7,818.91 2,469.68

ii) Cheques on hand 2,220.79 2,614.89

iii) Remittances in transit 9.48 144.00

iv) Balances with scheduled banks in:

Current accounts 166,298.17 163,490.58

Fixed Deposit Accounts# 277,601.62 277,968.59

453,948.97 446,687.74

Other current assets

Interest accrued on investments 666.89 93.45

Interest accrued on fixed deposits and other loans and advances 4,358.07 5,576.00
Lending through Collateralised Borrowing and Lending
Obligation - 55,995.04

2,255,469.18 2,662,603.05

# Includes Fixed deposits pledged with Banks as margin for

securitisation 197,421.41 178,712.56
# Includes Fixed deposits pledged with Banks as as lien against
loans taken 8,534.94 415.53

F-195
 Annexure IV
Shriram Transport Finance Company Limited
Schedules to the Reformatted Consolidated Statement of
Assets and Liabilities
(Rs. in lacs)

As at March 31, As at December 31,

Schedule 4 - Other Loans and Advances
2010 2009

Unsecured, Considered Good

Advances recoverable in cash or in kind or for value to be
received 229,668.92 56,211.57

Service tax credit (input) receivable 537.34 863.37

Advance income tax (net of provisions for income tax) - 375.18

Prepaid expenses 8,649.99 8,368.94

Inter-corporate deposits 1,379.21 -

Security deposits 722.61 681.71

240,958.07 66,500.77

F-196
 Annexure IV

Shriram Transport Finance Company Limited

Schedules to the Reformatted Consolidated Statement of Assets and Liabilities

(Rs. in lacs)

Schedule 5 - Secured Loans As at March 31, 2010 As at December 31, 2009

Redeemable non convertible debentures 483,087.87 553,229.53

refer note 1(a)(i)(ii)(iii)

Term loans
i) From Financial institutions / Foreign institutions /
Corporates 12,188.42 40,277.57
refer note 1(b)(i)

ii) From banks 929,935.14 972,557.48

refer note 1(b)(ii)

Cash credit from banks 92,036.64 348,910.53

refer note 1(c )

1,517,248.07 1,914,975.11

Schedule 6 - Unsecured Loans As at March 31, 2010 As at December 31, 2009

Fixed deposits 11,479.51 8,290.59

Inter corporate deposits 16.68 24.95

Subordinated debts 206,599.49 191,682.41

Redeemable non-convertible debentures 2,500.00 2,500.00

Commercial papers 2,500.00 2,500.00

Term loan :
i) From banks 70,647.21 100,639.54

ii) From corporates 35,000.00 35,000.00

328,742.89 340,637.49

F-197
 Annexure IV
Shriram Transport Finance Company Limited
Schedules to the Reformatted Consolidated Statement of Assets and Liabilities
(Rs. in lacs)

As at March As at December 31,

Schedule 7 - Current Liabilities
31, 2010 2009

Sundry creditors other than Micro and Small Enterprises 23,291.23 22,194.52
Interest accrued but not due on loans 84,941.79 82,446.07
Application money on Redeemable non convertible debentures 798.77 1,005.19
Application money on Subordinated debts 15.79 25.91
Investor Education and protection fund shall be credited by following
amounts (as and when due)
- Unclaimed Matured Deposits 60.65 68.30
- Unclaimed Matured Debentures 5,116.68 6,029.85
- Unclaimed Matured Subordinated Debts 117.13 68.21
- Interest accrued and due on above 1,329.00 1,495.70
- Unclaimed dividend 269.67 289.10
Temporary credit balance in bank accounts 29,551.21 31,931.95
Securitization deferred income 236,518.83 94,410.58
Other liabilities 8,852.77 9,768.62

390,863.52 249,734.00

As at March As at December 31,

Schedule 8 - Provisions
31, 2010 2009

Non-performing assets 38,637.89 38,059.42

Credit loss on securitisation 24,986.49 13,949.42

Income tax (net of advance tax ) 980.68 -

Fringe benefit tax (net of advance tax) 7.67 7.67

Diminution in value of investments 247.37 248.70

For leave encashment and availement 561.66 534.81

Gratuity 612.63 583.83

Proposed dividend 9,020.71 -

Corporate dividend tax 1,498.25 -

76,553.35 53,383.85

F-198
 Annexure IV

Shriram Transport Finance Company Limited

Schedules to the Reformatted Consolidated Statement of Assets and Liabilities

(Rs. in lacs)

Schedule 9 - Share Capital As at March 31, 2010 As at December 31, 2009

Authorised
Equity Share Capital 33,500.00 33,500.00
Preference Share Capital 20,000.00 20,000.00
53,500.00 53,500.00

No. of equity Shares of Rs.10/- each 335,000,000 335,000,000

No. of preference Shares of Rs.100/- each 20,000,000 20,000,000

Issued, Subscribed & Fully Paid up

Equity Shares 22,551.78 * 21,277.46 *

No. of equity shares of Rs. 10/- each 225,517,818 212,774,566

Add : Share Forfeiture 2.40 2.40

22,554.18 21,279.86

*Includes 79,279,236 equity shares of Rs.10/- each allotted for consideration other than cash pursuant to the schemes of
amalgamation.

F-199
 Annexure IV
Shriram Transport Finance Company Limited

Schedules to the Reformatted Consolidated Statement of Assets and Liabilities

(Rs. in lacs)

Schedule 10 - Reserves and Surplus As at March 31, 2010 As at December 31, 2009

Reserves and Surplus

Capital Reserve
Balance as per last account 17.03 17.03
17.03 17.03

Capital Redemption Reserve 5,388.35 5,388.35

Securities Premium Account

Balance as per last account 91,689.29 91,689.29

Add: Amount received during the year/period 82,730.28 24,448.71
174,419.57 116,138.00
Statutory Reserve
Balance as per last account 33,899.79 33,899.79
Add: Transfer from Profit & Loss Account 17,500.00 -
51,399.79 33,899.79
Debenture Redemption Reserve
Balance as per last account -
Add: Transfer from Profit & Loss Account 10,442.08 6,802.27
10,442.08 6,802.27
General Reserve
Balance as per last account 17,453.63 17,453.63
Add: Transfer from Profit & Loss Account 8,800.00 -
26,253.63 17,453.63

Balance in Profit & Loss Account 92,992.47 107,008.54

Add: Share of profit in Associate upto March 31, 2009 182.71 182.71
93,175.18 107,191.25

361,095.63 286,890.32

F-200
 Annexure IV

Shriram Transport Finance Company Limited

Schedules to the Reformatted Consolidated Statement of Assets and Liabilities

(Rs. in lacs)

Schedule 11 - Miscellaneous Expenditure (to the As at March 31,

As at December 31, 2009
extent not written off or adjusted) 2010

Issue expenses for equity shares 1,491.47 -

Public issue expenses for non convertible debentures 2,217.22 3,543.21

3,708.69 3,543.21

F-201
 Annexure V
Shriram Transport Finance Company Limited

Schedules to the Reformatted Consolidated Statement of Profits and Losses

(Rs. in lacs)

For the year ended March

For the period April 01, 2009 to
Schedule 12 - Income from Operations 31, 2010
December 31, 2009

Finance & service charges 361,545.82 278,129.52

Interest on other loans 360.10 261.72
Interest on margin money on securitisation 10,367.78 7,967.54
Income on securitisation 68,009.04 34,498.68

440,282.74 320,857.46

For the year ended March For the period April 01, 2009 to
Schedule 13 - Other Income
31, 2010 December 31, 2009

Buyer-seller facilitation fees 3,053.46 2,235.91

Interest on deposits with banks 1,698.44 1,133.07
Income from operating lease 453.91 445.78
Profit on sale of assets 62.40 88.78
Income from Long Term Investments
(non trade)
- Profit on sale of investments (net) 66.55 66.55
- Profit on disposal of subsidiary 3.15 3.15
- Dividend 0.25 0.25
- Interest on government securities 100.51 40.57
- Interest on Pass Through Certificates 119.18 114.01
Income from Current Investments (non
trade)
- Profit on sale of investments 1,746.10 755.77
- Dividend 874.46 874.46
- Interest on Certificate of Deposits 1,068.27 287.69
- Discount on CBLO 193.55 -
Miscellaneous Income 245.67 139.47

9,685.90 6,185.46

F-202
 Annexure V
Shriram Transport Finance Company Limited
Schedules to the Reformatted Consolidated Statement of Profits and Losses
(Rs. in lacs)

For the year ended March

For the period April 01, 2009 to
Schedule 14 - Interest & Other Charges 31, 2010
December 31, 2009

Interest & Other Charges on :

Debentures 65,969.57 49,635.34
Subordinated debts 23,214.26 16,741.25
Fixed deposits 475.98 228.19
Loans from banks 105,813.69 78,276.88
Loans from institutions and others 13,455.67 11,177.26
Commercial paper 2,199.54 2,149.41
Bank charges 2,350.85 1,851.92
Professional charges - resource mobilisation 4,895.23 3,063.13
Processing charges on loans/ securitization 3,605.42 2,650.84
Discount on sale of second loss credit /
liquidity facilities 584.00 -
Fees / Loss on sale of second loss credit /
liquidity facilities 2,114.72 1,603.62

224,678.93 167,377.84

F-203
 Annexure V
Shriram Transport Finance Company Limited

Schedules to the Reformatted Consolidated Statement of Profits and Losses

(Rs. in lacs)

For the year ended For the period April 01,

Schedule 15 - Raw Material Consumed March 31, 2010 2009 to December 31,
2009

Opening Stock 126.81 126.81

Add : Purchases - -

Less : Transferred to Lessee (126.81) (126.81)

Closing Stock - -

- -

For the year ended For the period April 01,

Schedule 16 - Personnel Expenses March 31, 2010 2009 to December 31,
2009

Salaries & other allowances 21,020.66 15,317.90

Gratuity expenses 197.65 141.06

Contribution to provident and other funds 976.89 710.59

Staff welfare expenses 312.95 226.74

22,508.15 16,396.29

F-204
 Annexure V
Shriram Transport Finance Company Limited
Schedules to the Reformatted Consolidated Statement of Profits and Losses
(Rs. in lacs)
For the period April 01,
For the year ended
Schedule 17 - Operating and other Expenses 2009 to December 31,
March 31, 2010
2009

Rent 3,557.92 2,598.20

Electricity expenses 467.29 369.11

Repairs & Maintenance
- Plant & machinery 5.79 13.06

- Building 0.70 0.46

- Others 2,273.27 1,736.50
Rates & taxes 230.01 138.11
Printing & stationery 1,483.07 973.15

Travelling & conveyance 3,329.11 2,416.95

Advertisement 443.50 93.06

Brokerage and discount 5,442.03 4,593.85

Data sourcing & collection commission paid to others 23.96 20.89

Royalty 1,240.78 901.81

Directors' sitting fees 14.65 10.80

Insurance 148.37 106.78
Communication expenses 2,571.12 1,877.83
Auditor's remuneration
- Audit fees 72.97 39.71

- Tax audit fees 2.76 -

- Other services 3.31 1.10

- Out of pocket 4.82 3.67

Legal & professional charges 2,827.61 1,469.77

Donations 161.81 51.49

Miscellaneous expenses 2,953.64 2,221.17

27,258.49 19,637.47

F-205
 Annexure V
Shriram Transport Finance Company Limited
Schedules to the Reformatted Consolidated Statement of
Profits and Losses
(Rs. in lacs)

For the year ended For the period April 01,

Schedule 18 - Share & Debenture issue expenses written
March 31, 2010 2009 to December 31,
off
2009

Issue expenses for equity shares 25.28 -

Public issue expenses for non convertible debentures 473.42 394.28

Preliminary Expenses 6.93 6.38

505.63 400.66

For the year ended For the period April 01,

Schedule 19 - Provisions & Write offs March 31, 2010 2009 to December 31,
2009

Provision for non performing assets 14,953.03 14,374.56

Provision for credit loss on securitisation 7,971.84 3,317.30

Provision for diminution in value of investments 20.34 21.67

Bad debts written off 18,668.99 13,526.46

Bad debt recovery (549.34) (397.02)

41,064.86 30,842.97

F-206
 Annexure VI

Shriram Transport Finance Company Limited

Statement of Contingent Liabilities

(Rs in Lacs)

As at March 31, 2010 As at December 31, 2009

Particulars

Disputed Income Tax/Interest Tax demand contested

in appeals not provided for 157.26 164.76

Guarantees issued by the Company and outstanding - 700.00

Demand in respect of Service tax 315.00 312.00

Income Tax penalty u/s 271(1)(c ) - 349.86

Disputed Sales Tax Demand 412.33 -

F-207
 Annexure VII

Shriram Transport Finance Company Limited

Statement of Dividend

Statement of Dividend in respect of Equity Shares

Year ended As at 31st March, For Nine months ended

Particulars
2010 December 31, 2009
Interim
Rate of Dividend 20% 20%
Number of Equity Shares on which Interim
Dividend paid 212,737,916 212,737,916
Amount of Interim Dividend 4,254.76 4,254.76
Dividend Distribution Tax 723.10 723.10

Final Dividend for the previous year

Rate of Dividend 40% 40%
Number of Equity Shares on which Final
Dividend paid 8,129,550 8,129,550
Amount of Final Dividend 325.18 325.18
Dividend Distribution Tax 55.26 55.26

Proposed Final Dividend for the current year

Rate of Dividend 40% -
Number of Equity Shares on which dividend
paid 225,517,818 -
Amount of Final Dividend 9,020.71 -
Dividend Distribution Tax 1,498.25 -

Annexure-VIII
Shriram Transport Finance Company Limited

Page 1 of 3

F-208
Statement of Accounting Ratios
[Calculation of Earnings Per shares (EPS)]

Earnings per share calculations are done in accordance with Accounting Standard - 20
"Earnings Per Share",
notified under Accounting Standards (‘AS’) under Companies Accounting Standard
Rules, 2006, as amended

As at December 31,
As at March 31, 2010
2009
Particulars

Net Profit after tax, Minority interest and Share of loss of

Associates as per profit and loss accountNet profit after tax
(Rs. in Lacs) 87,302.56 60,859.86

Less: Preference dividend including tax on dividend (Rs.

in Lacs) - -

Net profit attributable to equity shareholders (Rs. in Lacs) a 87,302.56 60,859.86

Weighted average number of equity shares outstanding b 2,125..01 2,097.17

during the year. (for Basic EPS )(Lacs)

(i) Equity shares arising on conversion of optionally

convertible warrants (Lacs) c - -

(ii) Equity shares for no consideration arising on grant d 8.84 18.80

of stock options under ESOP (Lacs)

Weighted average number of equity shares outstanding e 2,133.85 2,115.97

during the year/period. (for Diluted EPS ) (b+c+d) (Lacs)

Earnings per share (Basic) (Annualised) (Rs.) (a/b) 41.08 *29.02

Earnings per share (Diluted) (Annualised) (Rs.) (a/e) 40.91 *28.76

*not annualised

Annexure-VIII
Shriram Transport Finance Company Limited

F-209
 Page 2 of 3

Statement of Accounting Ratios

[Calculation of Return on Net Worth (RONW)]
(Rs. in Lacs)

As at March 31, 2010 As at December 31, 2009

Particulars

SHAREHOLDERS FUNDS

Share Capital 22,554.18 21,279.86

Share application money pending allotment 5.22 12.97
Stock Option Outstanding 757.02 1,497.93
Reserves and Surplus (Refer Annexure IV -
Schedule 10) 361,095.63 286,890.32

Less: Miscellaneous Expenditure 3,708.69 3,543.21

( not written off)

Net worth as at the end of the year/period 380,703.36 306,137.87

Net Profit after tax, Minority interest and 87,302.56 60,859.86

Share of loss of Associates as per profit and
loss accountNet profit after tax

Return on Net Worth (Annualised) (%) 22.93% 26.51%

F-210
 Annexure VIII
Shriram Transport Finance Company Limited

Page 3 of 3

Statement of Accounting Ratios

[Calculation of Net Asset Value (NAV) Per Equity Share]

(Rs. in Lacs)

As at March 31, 2010 As at December 31, 2009

Particulars

SHAREHOLDERS FUNDS

Share Capital 22,554.18 21,279.86

Share application money pending allotment 5.22 12.97
Stock Option Outstanding 757.02 1,497.93

Reserves and Surplus (Refer Annexure IV - Schedule 10) 361,095.63 286,890.32

Less: Miscellaneous Expenditure 3,708.69 3,543.21

( not written off)
Net Asset Value 380,703.36 306,137.87

Number of Equity shares outstanding at the end of

the period 225,517,818 212,774,566

Net Asset Value per Equity Share(Rs.) 168.81 143.88

F-211
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans
A Term Loan from banks Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31,
2010
Allahabad Bank 26-Sep-07 3000.00 1499.90 20 quarterly
instalments
Andhra Bank 30-Nov-09 20000.00 18750.00 16 quarterly
installments
Andhra Bank 16-Mar-09 10000.00 7500.00 16 quarterly
installments
AXIS Bank 18-Feb-08 10000.00 10000.00 Bullet-17/02/2011
AXIS Bank 20-Oct-08 20000.00 20000.00 Bullet-19/10/2010
AXIS Bank 24-Mar-09 50000.00 16666.67 6 quarterly
installments
Bank Of Rajasthan 30-Jun-09 2500.00 1875.00 12 quarterly
installments
Bank Of Tokyo 24-Dec-09 11000.00 11000.00 Bullet-24/12/2010
Barclays Bank 3-Aug-09 3000.00 3000.00 Bullet-03/08/2010
Barclays Bank 30-Oct-09 4500.00 4500.00 Bullet-30/10/2010
Barclays Bank 29-Sep-09 3400.00 3400.00 Bullet -29/09/2010
Calyon Bank 16-Nov-07 5000.00 5000.00 Bullet-15/11/2010
Calyon Bank 24-Mar-08 2000.00 2000.00 Bullet-24/03/2011
Calyon Bank 28-Apr-08 3000.00 3000.00 Bullet-27/04/2011
Canara Bank 26-Jun-09 25000.00 20312.50 16 quarterly
installments
Canara Bank 25-Nov-09 50000.00 46875.00 16 equal quarterly
installments
Canara Bank 31-Mar-09 25000.00 18750.00 16 quarterly
installments
Canara Bank 17-Oct-08 20000.00 13750.00 16 quarterly
installments
Canara Bank 5-Nov-08 20000.00 13750.00 16 quarterly
installments
Central Bank Of India 30-Jun-09 20000.00 16250.00 16 quarterly
installments
China Trust Commercial Bank 18-Nov-09 1500.00 1500.00 Bullet 18/11/2011
CITI Bank 23-Jun-09 5000.00 5000.00 Bullet-23/06/2010
CITI Bank 7-May-09 10000.00 10000.00 Bullet -07/05/2010
CITI Bank 17-Aug-09 10000.00 10000.00 Bullet-17/8/2010
Corporation Bank 26-Mar-09 2500.00 1875.00 16 quarterly
installments
Development Bank Of Singapore 22-Jun-09 5000.00 5000.00 3 installments

F-212
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans
A Term Loan from banks Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31,
2010
Development Bank Of Singapore 23-Sep-09 4,830.00 4,830.00 Bullet- 23/09/2011
Development Bank Of Singapore 5-Mar-09 2,650.00 2,650.00 Bullet-05/09/2010
Development Bank Of Singapore 27-Sep-07 7,500.00 7,500.00 Bullet-27/09/2010
Dena Bank 23-Sep-08 20,000.00 10,000.00 36 monthly
installments
Dena Bank 31-Jul-09 20,000.00 17,500.00 16 equal quarterly
installments
Deutsche Bank 22-Sep-09 7,500.00 7,500.00 Bullet 22/09/2011
Deutsche Bank 30-May-08 10,000.00 10,000.00 Bullet-30/05/2011
Deutsche Bank 30-May-08 10,000.00 10,000.00 Bullet-30/05/2010
HDFC Bank 25-Jul-08 7,500.00 5,357.14 14 equal quarterly
installments
HDFC Bank 3-Oct-09 10,000.00 10,000.00 14 quarterly
installments
HSBC Bank 29-May-09 4,770.00 4,770.00 Bullet-31/05/2011
HSBC Bank 23-Oct-09 9,332.00 7,387.83 24 Equal Monthly
installments
HSBC Bank 4-Aug-09 10,000.00 10,000.00 Bullet-04/08/2010
HSBC Bank 25-Mar-09 9,250.00 9,250.00 Bullet-26/04/2010
HSBC Bank 18-Sep-09 4,850.00 4,850.00 Bullet-16/09/2011
ICICI Car Loan 10-Feb-06 9.77 1.87 60 equated monthly
installments
ICICI Car Loan 5-Jun-06 4.90 1.32 59 equated monthly
installments
IDBI Bank 28-Apr-08 25,000.00 10,416.67 12 equal quarterly
installments
IDBI Bank 29-Sep-09 20,000.00 19,523.81 42 monthly equal
installments
IDBI Bank 24-Mar-09 15,000.00 10,714.29 14 equal quarterly
installments
IDBI Bank 3-Mar-08 7,500.00 2,678.83 14 equal quarterly
installments
IDBI Bank 24-Oct-08 5,000.00 3,214.29 14 equal quarterly
installments
IDBI Bank 10-Dec-08 10,000.00 6,428.57 14 equal quarterly
installments
Indian Bank 30-Jun-09 10,000.00 7,273.00 33 monthly
installments
Indian Bank 28-Sep-07 5,000.00 525.59 33 monthly
installments

F-213
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans
A Term Loan from banks Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31,
2010
Indian Bank 5-Mar-09 10,000.00 6,363.64 33 monthly
installments
Indian Bank 25-Mar-08 5,000.00 1,515.84 33 monthly
installments
ING Vysya Bank 31-Dec-07 6,500.00 1,625.00 36 monthly
installments
ING Vysya Bank 2-Dec-08 3,500.00 2,041.67 36 monthly
installments
ING Vysya Bank 30-Oct-09 3,800.00 3,272.22 36 equal monthly
installments
Karur Vysya Bank 31-Jul-09 2,000.00 1,750.00 16 equal quarterly
installments
Laxmi Vilas Bank 12-Sep-09 4,500.00 4,500.00 Bullet -12/09/2010
Oriental Bank Of Commerce 24-Aug-09 20,000.00 16,111.11 36 equated monthly
installments
Oriental Bank Of Commerce 28-Feb-08 20,000.00 10,160.69 48 equated monthly
installment
Oriental Bank Of Commerce 22-Nov-07 10,000.00 2,397.51 36 equated monthly
installments
Punjab & Sind Bank 16-Apr-08 5,000.00 5,000.00 Bullet-15/04/2011
Punjab & Sind Bank 19-Nov-09 5,000.00 4,722.22 36 monthly
installment
Punjab National Bank 15-Oct-08 20,000.00 10,285.69 35 monthly
installment
Punjab National Bank 27-Jul-09 20,000.00 15,294.00 34 equal monthly
installment
Ratnakar Bank 20-Dec-07 2,500.00 1,093.60 48 Monthly
installments
State Bank Of Patiala Bank 29-Sep-09 20,000.00 20,000.00 13 quarterly
installments
State Bank Of Travancore 29-Sep-09 10,000.00 8,610.00 36 equal monthly
installment
Society General Bank 14-Aug-09 2,000.00 1,416.67 24 Monthly
installments
Society General Bank 24-Dec-09 1,200.00 1,050.00 24 equal Monthly
installments
Society General Bank 29-Oct-07 6,000.00 1,240.00 36 monthly
installments
Society General Bank 14-Mar-08 1,180.00 331.87 36 monthly
installments
South Indian Bank 17-Dec-09 5,000.00 4,687.50 16 equal quarterly
installments

F-214
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans
A Term Loan from banks Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31,
2010
South Indian Bank 18-Aug-08 5,000.00 3,125.00 16 quarterly
installments
South Indian Bank 20-Mar-09 2,500.00 1,875.00 16 quarterly
installments
Standard Chartedred Bank 4-Mar-09 8,700.00 4,002.00 24 Monthly
installments
Standard Chartedred Bank 6-May-08 13,000.00 1,040.00 24 Monthly
installments
State Bank Of Bikaner & Jaipur 8-Nov-07 5,000.00 1,256.00 12 quarterly
installments
State Bank Of Bikaner & Jaipur 9-Apr-09 5,000.00 3,121.25 16 quarterly
installments
State Bank Of Bikaner & Jaipur 31-Mar-09 2,500.00 2,500.00 16 quarterly
installments
State Bank Of Hyderabad 5-Nov-09 25,000.00 23,437.50 16 quarterly
installments
State Bank Of Hyderabad 21-Jan-08 15,000.00 7499.40 16 quarterly
installments
State Bank Of Mauritius Bank 19-Jan-09 2,250.00 1,500.00 12 Quarterly
installments
State Bank Of Mysore Bank 29-Sep-06 2,500.00 315.86 48 monthly
installments
State Bank Of Mysore Bank 22-Jun-07 10,000.00 2,905.54 48 monthly
installments
State Bank Of Mysore Bank 5-Mar-09 10,000.00 7,499.97 48 monthly
installments
State Bank Of Mysore Bank 26-Nov-07 10,000.00 4,175.58 48 monthly
installments
State Bank Of Mysore Bank 19-Sep-08 15,000.00 9,370.86 48 monthly
installments
State Bank Of Patiala Bank 30-Jul-08 20,000.00 14,280.00 14 quarterly
installments
State Bank Of Travancore 28-Jun-07 5,000.00 416.69 12 quarterly
installments
State Bank Of Travancore 29-Jan-09 7,500.00 5,000.00 12 quarterly
installments
Syndicate Bank 29-Sep-09 15,000.00 13,125.00 48 monthly
installments
Tamilnad Merchantile Bank Limited 22-Jun-09 5,000.00 4,062.50 48 Monthly
installments
UCO Bank 25-Sep-09 15,000.00 13,125.00 16 equal quarterly
installments
Union Bank 31-Dec-09 30,000.00 30,000.00 16 equal quarterly
installments
United Bank 25-Sep-09 10,000.00 8,750.00 16 quarterly
installments

F-215
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans

A Term Loan from banks Rs in Lacs

Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31,
2010
United Bank 3-Jun-08 5,000.00 2,812.50 16 quarterly
installments
United Bank 31-Dec-08 10,000.00 7,500.00 16 quarterly
installments
United Bank 13-Mar-09 15,000.00 11,250.00 16 quarterly
installments

Vijaya Bank 28-Sep-06 5,000.00 625.00 16 quarterly

installments
Vijaya Bank 28-Feb-08 5,000.00 2,500.00 16 quarterly
installments
Barclays Bank 19-Jan-10 4,100.00 4,100.00 Bullet 19/01/2011
Indian Bank 29-Jan-10 20,000.00 19,168.00 48 Monthly
installment
State Bank Of India (Wcdl) 28-Jan-10 20,000.00 20,000.00 Bullet 27/07/2010
Standard Charterd Bank 28-Jan-10 30,000.00 30,000.00 5 installment
Calyon Bank 29-Jan-10 10,000.00 10,000.00 Bullet 29/01/2012
State Bank of Indore(Wcdl) 9-Feb-10 7,500.00 7,500.00 Bullet 10/05/2010
State Bank of Patiala(Wcdl) 26-Feb-10 4,000.00 4,000.00 Bullet-27/05/2010
Shinhan Bank 9-Feb-10 2,800.00 2,800.00 Bullet-01/01/2011
Mizuho Bank 5-Mar-10 5,000.00 5,000.00 Bullet-05/03/2011
Dhanlakshmi Bank 12-Mar-10 5,000.00 5,000.00 15 quarterly
installment
J P Morgan Chase Bank 22-Mar-10 12,000.00 12,000.00 Bullet - 06/04/2011
HSBC Bank 23-Mar-10 10,000.00 10,000.00 Bullet -23/04/2011
Corporation Bank 25-Mar-10 10,000.00 10,000.00 20 quaterly
installment
Punjab National Bank 26-Mar-10 25,000.00 25000.00 34 Monthly
installment
Society General Bank 23-Mar-10 1,200.00 1,200.00 24 Monthly
installments
Total 1,205,826.67 929,935.14

F-216
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Term Loans
B Term Loan from others Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
disbursement Amount March 31,
2010
L&T Finance Limited 2-Mar-05 2,500.00 466.08 72 monthly
installments
L&T Finance Limited 29-Jun-05 2,500.00 626.97 72 monthly
installments
L&T Finance Limited 2-Jan-06 2,500.00 860.37 72 monthly
installments
Life Insurance Corporation 14-Jun-06 7,500.00 3,000.00 5 annual installments
Small Industries Development Bank of 2-Jan-06 2,000.00 335.00 54 monthly
India installments
Small Industries Development Bank of 31-Dec-07 5,000.00 1,400.00 33 monthly
India installments

Small Industries Development Bank of 29-Sep-08 10,000.00 5,500.00 33 monthly

India installments

Total 32,000.00 12,188.42

C Cash Credit from Banks

Particulars Date of Disbursed Balance as on

disbursement Amount March 31,
2010
Abu Dhabi Commercial Bank 3-Feb-09 1,500.00 4.88
Andhra Bank 30-Dec-09 15,000.00 1,012.85
Bahrain & Kuwait 22-Jul-08 1,000.00 899.99
Bank Of Baroda 19-Nov-07 4,000.00 3,006.12
Bank Of Ceylon 21-Nov-08 600.00 0.16
Bank Of India 4-Jun-09 27,500.00 9,998.11
Bank Of India WCDL 28-Aug-09 20,000.00 20,000.00
Bank Of Maharashtra 22-Dec-08 10,000.00 3,699.36
Bank Of Rajasthan 22-Jun-09 2,500.00 6.58
Central Bank Of India 21-Aug-09 30,000.00 15,050.78
City Union Bank 13-Oct-08 5,000.00 1,638.92
Corporation Bank 16-Jan-08 5,000.00 972.01
DCB WCDL 22-Jan-10 2,000.00 2,000.00
DCB WCDL 30-Jan-10 2,000.00 2,000.00
Dena Bank 30-Jan-09 17,500.00 99.06
Federal Bank 19-Sep-07 5,000.00 5.86
ICICI Bank 5-Mar-09 20,000.00 6,988.85

F-217
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
C Cash Credit from Banks Rs in Lacs
Particulars Date of Disbursed Balance as on
disbursement Amount March 31,
2010
IDBI Bank 3-Oct-08 5,000.00 5.01
IDBI Bank 29-Jan-10 20,000.00 56.75
Indian Bank 29-Jan-10 5,000.00 6.49
Indian Overseas Bank 18-Feb-09 10,000.00 5,012.22
Karnataka Bank 5-Dec-07 10,000.00 4,730.09
Karur Vysya Bank Wcdl 30-Jun-09 1,500.00 1,512.11
Punjab National Bank 24-Dec-07 6,000.00 0.06
Ratnakar Bank 11-Aug-08 1,000.00 5.43
State Bank Of Bikaner & Jaipur 30-Dec-09 5,000.00 4,207.18
State Bank Of Mysore 26-Sep-09 10,000.00 3,012.86
State Bank Of Travancore 29-Sep-08 7,500.00 3,557.73
Syndicate Bank 5-Mar-10 10000.00 2,520.59
The Lakshmi Vilas Bank 17-Mar-09 2,500.00 3.45
UCO Bank 4-Aug-08 15,000.00 23.14
TOTAL 277,100.00 92,036.64

D Privately placed Redeemable Non Convertible Debenture of Rs 1,000,000 each

Rs in Lacs
Particulars Date of Disbursed Balance as on Repayment Terms
Allotment Amount March 31,
2010
UTI - Treasury Advantage Fund 5-Jul-07 5,000.00 5,000.00 Bullet -05/07/2010
UTI - Treasury Advantage Fund 9-Jul-07 2,500.00 2,500.00 Bullet -09/07/2010
HDFC Trustee Company Ltd - A/C 9-Jul-07 1,590.00 1,590.00 Bullet -09/07/2010
HDFC Fixed Maturity Plan 36M June
2007
UTI - Fixed Maturity Plan - Yearly 9-Jul-07 1,500.00 1,500.00 Bullet -09/07/2010
Series Sep 09
Reliance General Insurance Company 9-Jul-07 500.00 500.00 Bullet -09/07/2010
Ltd
HDFC Trustee Company Limited A/C 9-Jul-07 500.00 500.00 Bullet -09/07/2010
HDFC Fixed Maturity Plan
17Mnovember 2008 (1)
HDFC Trustee Company Limited A/C 9-Jul-07 210.00 210.00 Bullet -09/07/2010
HDFC Cash Management Fund
Treasury Advantage Plan

F-218
 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Rs in Lacs
D Privately placed Redeemable Non Convertible Debenture of Rs 1,000,000 each
Particulars Date of Disbursed Balance as on Repayment Terms
Allotment Amount March 31,
2010
HDFC Trustee Company Limited A/C 9-Jul-07 200.00 200.00 Bullet -09/07/2010
HDFC Fixed Maturity Plan 22M
September 2008
HDFC Standard Life Insurance 11-Jul-07 1,000.00 1,000.00 Bullet -09/07/2010
Company Limited
The Hongkong And Shanghai Banking 25-Jul-07 2,500.00 2,500.00 Bullet -25/07/2010
Corp.Ltd.
ICICI Prudential Flexible Income Plan 25-Jul-07 10,000.00 10,000.00 Bullet -25/07/2010
UTI-Unit Linked Insurance Plan 10-Sep-07 1,000.00 1,000.00 Bullet -10/09/2010
UTI - Ftif Series Vii Plan II 10-Sep-07 1,350.00 1,350.00 Bullet -10/09/2010
UTI - CCP Advantage Fund 10-Sep-07 150.00 150.00 Bullet -10/09/2010
KOTAK Mahindra Trustee Company. 15-Oct-07 2,000.00 2,000.00 Bullet -15/10/2010
Ltd. A/C KOTAK Fixed Maturity Plan
370 Days Series 1
ICICI Prudential Short Term Plan 19-Oct-07 1,500.00 1,500.00 Bullet -18/10/2010
UTI - Retirement Benefit Pension Fund 19-Oct-07 1,400.00 1,400.00 Bullet -18/10/2010
ICICI Prudential Ultra Short Term 19-Oct-07 1,000.00 1,000.00 Bullet -18/10/2010
Fund
UTI-Liquid Cash Plan 19-Oct-07 2,500.00 2,500.00 Bullet -19/10/2010
UTI - Treasury Advantage Fund 19-Oct-07 2,360.00 2,360.00 Bullet -19/10/2010
UTI-Money Market Fund 19-Oct-07 140.00 140.00 Bullet -19/10/2010
Life Insurance Corporation Of India 2-May-08 15,000.00 15,000.00 Bullet -02/05/2011
UTI-Unit Linked Insurance Plan 20-Jun-08 3,500.00 3,500.00 Bullet -20/06/2011
UTI-Unit Scheme For Charitable And 20-Jun-08 2,500.00 2,500.00 Bullet -20/06/2011
Religious trusts And Registered
Societies
UTI - Childrens Career Balanced Plan 20-Jun-08 2,500.00 2,500.00 Bullet -20/06/2011
UTI - Retirement Benefit Pension Fund 20-Jun-08 1,500.00 1,500.00 Bullet -20/06/2011
Reliance Capital Trustee Company Ltd 4-Sep-08 5,000.00 5,000.00 Bullet -04/09/2010
A/C-Reliance money Manager Fund
HDFC Trustee Company Limited A/C 4-Sep-08 4,300.00 4,300.00 Bullet -04/09/2010
HDFC Cash Management Fund
Treasury Advantage Plan
HDFC Trustee Company Limited A/C 4-Sep-08 600.00 600.00 Bullet -04/09/2010
HDFC Fixed Maturity Plan 22M
September 2008
HDFC Trustee Company Ltd-HDFC 4-Sep-08 100.00 100.00 Bullet -04/09/2010
Floating Rate Income Fund A/C Short
Term Plan
Deutsche Trustee Services (India) Pvt 8-Sep-08 2,800.00 2,800.00 Bullet -08/09/2010
Limited A/C Dws Fixed Term Fund

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Secured Loans Annexure IX
Rs in Lacs
D Privately placed Redeemable Non Convertible Debenture of Rs 1,000,000 each
Particulars Date of Disbursed Balance as on Repayment Terms
Allotment Amount March 31,
2010
Religare Trustee Company Private 8-Sep-08 110.00 110.00 Bullet -08/09/2010
Limited - A/C Religare Long Term
Fixed Maturity Plan - Series I - Plan A
Religare Trustee Company Private 8-Sep-08 80.00 80.00 Bullet -08/09/2010
Limited - A/C Religare Ultra Short
Term Fund
Religare Trustee Company Private 8-Sep-08 10.00 10.00 Bullet -08/09/2010
Limited - A/C Religare Short Term
Plan
AXIS Bank Limited 16-Sep-08 2,500.00 2,500.00 Bullet -16/09/2011
KOTAK Mahindra Trustee Company 15-Sep-08 1,070.00 1,070.00 Bullet -15/09/2010
Ltd. A/C KOTAK flexi Debt Scheme
KOTAK Mahindra Trustee Company. 15-Sep-08 430.00 430.00 Bullet -15/09/2010
Ltd. A/C KOTAK Fixed Maturity Plan
19M Series 01
KOTAK Mahindra Trustee Company 15-Sep-08 2,500.00 2,500.00 Bullet -15/09/2010
Ltd. A/C KOTAK flexi Debt Scheme
AXIS Bank Limited 15-Sep-08 1,500.00 1,500.00 Bullet -15/09/2011
UTI Ftif Sr - V Plan Ii ( 20 Mts ) 15-Sep-08 1,500.00 1,500.00 Bullet -30/04/2010
ICICI Prudential Fixed Maturity Plan 17-Sep-08 8,000.00 8,000.00 Bullet -01/09/2011
Series45 Three Years Plan
HDFC Trustee Company Limited A/C 24-Sep-08 2,500.00 2,500.00 Bullet -24/09/2010
HDFC Fixed Maturity Plan 22M
September 2008
HDFC Trustee Company Limited A/C 26-Sep-08 700.00 700.00 Bullet -26/09/2010
High Interest Fund Short Term Plan
HDFC Trustee Company Limited A/C 26-Sep-08 600.00 600.00 Bullet -26/09/2010
HDFC Fixed Maturity Plan
17Mnovember 2008 (1)
HDFC Trustee Company Ltd HDFC 26-Sep-08 550.00 550.00 Bullet -26/09/2010
Mf Monthly Income Plan Short Term
Plan
HDFC Trustee Company Limited A/C 26-Sep-08 350.00 350.00 Bullet -26/09/2010
HDFC Fixed Maturity Plan 22M
September 2008
HDFC Trustee Company Ltd A/C - 26-Sep-08 190.00 190.00 Bullet -26/09/2010
HDFC Children'S Gift Fund -
Investment Plan
HDFC Trustee Company Limited A/C 26-Sep-08 110.00 110.00 Bullet -26/09/2010
HDFC Cash Management Fund
Treasury Advantage Plan
UTI - Ftif Sr. V Plan Iii (24 Mts) 26-Sep-08 1,300.00 1,300.00 Bullet -10/09/2010
UTI-Unit Linked Insurance Plan 26-Sep-08 200.00 200.00 Bullet -10/09/2010

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Secured Loans Annexure IX
Rs in Lacs
D Privately placed Redeemable Non Convertible Debenture of Rs 1,000,000 each
Particulars Date of Disbursed Balance as on Repayment Terms
Allotment Amount March 31,
2010
Sundaram Bnp Paribas Mutual Fund 8-Oct-08 700.00 700.00 Bullet -06/04/2010
A/C Sundaram bnp Paribas Ftp - 18
Months Series L
Sundaram Bnp Paribas Mutual Fund 8-Oct-08 300.00 300.00 Bullet -06/04/2010
A/C Sundaram bnp Paribas Ultra Short
Term Fund
ICICI Prudential Fixed Maturity Plan - 8-Oct-08 190.00 190.00 Bullet -06/04/2010
Series45 - Twenty Months Plan
ICICI Prudential Liquid Plan 8-Oct-08 10.00 10.00 Bullet -06/04/2010
ICICI Prudential Real Estate Securities 24-Oct-08 4,500.00 4,500.00 Bullet -10/12/2010
Fund
ICICI Prudential Flexible Income Plan 24-Oct-08 500.00 500.00 Bullet -10/12/2010
Life Insurance Corporation Of India 3-Nov-08 30,000.00 30,000.00 Bullet -03/11/2013
General Insurance Corporation Of India 26-Nov-08 1,000.00 1,000.00 Bullet -26/11/2013
United Bank Of India 28-Mar-09 5,000.00 5,000.00 Bullet -28/03/2012
Templeton India Ultra-Short Bond Fund 13-Apr-09 10,000.00 10,000.00 Bullet -13/04/2011
Principal Trustee Company Private Ltd 20-Apr-09 2,000.00 2,000.00 Bullet -20/04/2011
A/C Principal Mutual Fund Principal
Income Fund Short Term Plan
Principal Trustee Company Private Ltd 20-Apr-09 500.00 500.00 Bullet -20/04/2011
A/C Principal Mutual Fund Principal
Income Fund
KOTAK Mahindra Trustee Company 17-Jun-09 1,800.00 1,800.00 Bullet -17/06/2011
Ltd. A/C KOTAK flexi Debt Scheme
KOTAK Mahindra Trustee Co. Ltd. A/C 17-Jun-09 700.00 700.00 Bullet -17/06/2011
KOTAK Fixed Maturity Plan18M
Standard Chartered Bank (Mauritius) 30-Jun-09 25,000.00 25,000.00 Bullet -30/06/2011
Limited -Debt
Tata Trustee Company Ltd A/C Tata 14-Sep-09 1,500.00 1500.00 Bullet -05/04/2011
Mutual Funda/C Tata Fixed Maturity
Plan - Series 25 Scheme A
Morgan Stanley India Capital Private 12-Oct-09 6,500.00 6,,500.00 Bullet -12/04/2011
Limited
KOTAK Mahindra Trustee Company. 12-Oct-09 1,400.00 1,400.00 Bullet -12/04/2011
Ltd. A/C KOTAK Fixed Maturity
Plan18M Series 2
KOTAK Mahindra Trustee Company 12-Oct-09 1,100.00 1,100.00 Bullet -12/04/2011
Ltd A/C KOTAK Fixed Maturity Plan
19 M Series 2
Take Solutions Ltd 24-Mar-10 2,400.00 2,400.00 Bullet -24/03/2011
Take Solutions Ltd 25-Mar-10 200.00 200.00 Bullet -25/03/2011
Cmnk Consultancy & Services Pvt Ltd- 25-Mar-10 2,400.00 2,400.00 Bullet -25/03/2011
B26
198,600.00 198,600.00

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 Shriram Transport Finance Company Limited
Secured Loans Annexure IX
Rs in Lacs

E Privately placed Redeemable Non Convertible Debenture of Rs 1,000 each

Rs in Lacs
Particulars As at March 31, 2010 Repayment Terms

Retail Debentures 188,703.14 Redeemable at par over

a period 12 to 160 months

S Secured Redeemable Non Convertible Debentures -Debt Issue 2009

Particulars As at March 31, 2010 Repayment Terms

Option -I
3,489.95 26.08.2012

Option -I 3,489.95
26.08.2013

Option -I 1,744.97
26.08.2014

Option -II 2,949.84

26.08.2012

Option -II 2,949.84

26.08.2013

Option -II 1,474.92

26.08.2014

Option -III 10,422.51 26.08.2014

Option -IV 2,274.12 26.08.2014

Option -V 66,988.63 26.08.2012

Total 95,784.73

Total Secured Loans (A+B+C+D+E+F) 1,517,248.07

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Notes:
1 Security
a. Loans aggregating to Rs. 1,034,157.01 lacs are secured by loan Receivables.
b. Loans aggregating to Rs. 3.19 lacs are secured by Vehicles.
c. Redeemable Non convertible Debentures aggregating to Rs. 284,487.87 lacs are secured by equitable
mortgage of title deeds of immovable property and secured by charge on fixed assets and hypothecation of
loan receivables
d. Privately Placed Redeemable Non convertible Debentures aggregating to Rs. 198,600.00 lacs are secured
by equitable mortgage of title deeds of immovable property and hypothecation of loan receivables

2 Terms as regards Interest/Pre-payment:

a. The Fixed Interest bearing Loans/CC/Non-convertible debentures aggregate to Rs. 822,619.63 Lacs and the
floating interest bearing Loans/CC/Non-convertible debentures aggregate to Rs. 694,628.45 Lacs. Out of
fixed interest bearing loans Rs. 26,257.83 lacs are hedged.
b. Out of the above, Loans/CC/Non-convertible debentures aggregating to Rs. 300,432.15Lacs have an
interest reset option.
c. Loans/CC/Non-convertible debentures aggregating to Rs. 716,162.45 Lacs have a Pre-payment option
upon payment of stipulated charges.
d. Loans/Non-convertible debentures aggregating to Rs. 55,130.11 Lacs have a Pre-payment option without
payment of charges.

3 Redeemable Non convertible Debentures issued under NCD Public Issue 2009 aggregating to Rs.
12,696.63 lacs have both Call & Put option.

4 Privately Placed Redeemable Non convertible Debentures aggregating to Rs. 12,500.00 lacs have both Call
& Put option.

5 Privately Placed Redeemable Non convertible Debentures - retail aggregating to Rs. 11,534.08 lacs have
Put option and Rs. 188,703.14 lacs have Call option

6 Loans aggregating to Rs. 13,125.00 lacs have Put call option.

7 The bankers have a right to appoint a nominee director in case of loans aggregating to Rs. 168,200.95 Lacs.

8 The Redeemable Non Convertible Debentures may be bought back subject to applicable statutory and/or
regulatory requirements, upon the terms and conditions as may be decided by the company.

9 The company may grant loan against the security of NCDs upon the terms and conditions as may be
decided by the company.

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Annexure X

Unsecured Loans

( Rs in Lacs )

Particulars As at Repayment Terms

Date of Disburse March 31,
Allotment d Amount 2010
Redeemable non-convertible
A debentures
UTI - Fixed Maturity Plan - 25-Sep-07 2,500.00 2,500.00 Bullet-25/09/2010
Yearly Series Sep 09
2,500.00 2,500.00
B Commercial Papers
UTI-Floating Rate Fund-Stp 4-Aug-09 1,500.00 1,500.00 Bullet-03/08/2010
Religare Trustee Company 4-Aug-09 1,000.00 1,000.00 Bullet-03/08/2010
Private Limited-A/Creligare
Credit Opportunities Fund
2,500.00 2,500.00
C Subordinated debts
Oriental Bank Of Commerce 30-Nov-07 1,000.00 1,000.00 Bullet-31/05/2013
UTI - Monthly Income Scheme 29-Jan-08 1,500.00 1,500.00 Bullet-29/07/2013
UTI-Unit Linked Insurance 29-Jan-08 1,000.00 1,000.00
Plan Bullet-29/07/2013
Bank Of India 1-Feb-08 1,500.00 1,500.00 Bullet-01/05/2013
Bank Of India 17-Mar-08 1,500.00 1,500.00 Bullet-17/09/2013
LICMF Liquid Fund 24-Mar-08 5,000.00 5,000.00 Bullet-24/06/2013
UCO Bank 27-Mar-08 1,000.00 1,000.00 Bullet-27/06/2013
LIC MF Liquid Fund 2-May-08 1,700.00 1,700.00 Bullet-03/10/2013
LIC MF Income Plus Fund 2-May-08 800.00 800.00 Bullet-03/10/2013
Hvpnl Employees Pension Fund 4-Aug-08 2,250.00 2,250.00 Bullet-04/08/2018
Trust
Food Corporation Of India Cpf 4-Aug-08 1,000.00 1,000.00 Bullet-04/08/2018
Trust
Hvpnl Employees Provident 4-Aug-08 750.00 750.00 Bullet-04/08/2018
Fund Trust
Gas Authority Of India Limited 4-Aug-08 300.00 300.00 Bullet-04/08/2018
Employees Provident Fund
Trust
The Jammu And Kashmir Bank 4-Aug-08 200.00 200.00 Bullet-04/08/2018
Employees Provident Fund
Trust

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Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of Disbursed As at Repayment
Allotment Amount March Terms
31, 2010
Gail Employees Superannuation Benefit Fund 4-Aug-08 100.00 100.00 Bullet-
04/08/2018
Gujarat Alkalies And Chemicals Ltd Employees 4-Aug-08 100.00 100.00 Bullet-
provident Fund Trust 04/08/2018
Gail (India) Limited Employees Death-Cum- 4-Aug-08 50.00 50.00 Bullet-
Superannuation Gratuity Scheme 04/08/2018
Asbestos Cement Limited Staff Provident Fund 4-Aug-08 40.00 40.00 Bullet-
04/08/2018
Provident Fund Of Mangalore Refinery And 4-Aug-08 40.00 40.00 Bullet-
Petrochemicals Limited 04/08/2018
Mother Dairy Employees Provident Fund Trust 4-Aug-08 30.00 30.00 Bullet-
04/08/2018
GSFC Ltd - Fibre Unit Employees Providend 4-Aug-08 30.00 30.00 Bullet-
fund Trust 04/08/2018
Trustees Provident Fund Of The Employees Of 4-Aug-08 30.00 30.00 Bullet-
The Ugar Sugar Works Ltd 04/08/2018
British High Commission India Staff Provident 4-Aug-08 20.00 20.00 Bullet-
fund 04/08/2018
Asbestos Cement Limited Employees Provident 4-Aug-08 20.00 20.00 Bullet-
Fund 04/08/2018
L & T Niro Staff Provident Fund 4-Aug-08 10.00 10.00 Bullet-
04/08/2018
Alembic Limited Provident Fund Trust 4-Aug-08 10.00 10.00 Bullet-
04/08/2018
Atlas Cycle Industries Provident Fund Trust 4-Aug-08 10.00 10.00 Bullet-
04/08/2018
Lubrizol India Limited Employees Provident 4-Aug-08 10.00 10.00 Bullet-
Fund 04/08/2018
Chhattisgarh State Electricity Board (CSEB) 5-Nov-08 2,000.00 2,000.00 Bullet-
Provident Fund Trust 05/11/2018
Delhi Development Authority 5-Nov-08 1,000.00 1,000.00 Bullet-
05/11/2018
Chhattisgarh State Electricity Board Gratuity and 7-Nov-08 1,500.00 1,500.00 Bullet-
Pension Fund Trust 07/11/2018
UCO Bank 26-Nov-08 5,000.00 5,000.00 Bullet-
26/02/2014
Jacobs H & G Pvt. Ltd. Employees Provident 26-Nov-08 10.00 10.00 Bullet-
Fund 26/02/2014
Bank Of Maharashtra 11-Dec-08 2,000.00 2,000.00 Bullet-
11/03/2014
Bank Of Baroda 11-Dec-08 2,000.00 2,000.00 Bullet-
11/03/2014
The Indian Iron And Steel Co Ltd Provident 11-Dec-08 500.00 500.00 Bullet-
Institution 11/03/2014

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Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of Repayment
Allotment Disburs Terms
ed As at
Amoun March
t 31, 2010
Durgapur Steel Plant Provident Fund 11-Dec-08 200.00 200.00 Bullet-
11/03/2014
Ashok Leyland Senior Executives Provident Fund 11-Dec-08 100.00 100.00 Bullet-
11/03/2014
Rameshwara Jute Mills Workers Provident Fund 11-Dec-08 100.00 100.00 Bullet-
trust 11/03/2014
Gujarat Alkalies And Chemicals Ltd Employees 11-Dec-08 50.00 50.00 Bullet-
Provident Fund Trust 11/03/2014
Shivani Kumar 11-Dec-08 13.00 13.00 Bullet-
11/03/2014
Russell Reynolds Associates India Employees 11-Dec-08 5.00 5.00 Bullet-
Provident Fund 11/03/2014
Frank Ross Ltd Employees' Provident Fund 11-Dec-08 5.00 5.00 Bullet-
11/03/2014
D S Savant And Sons Employees Provident Fund 11-Dec-08 5.00 5.00 Bullet-
11/03/2014
Paushak Ltd Provident Fund 11-Dec-08 5.00 5.00 Bullet-
11/03/2014
Afco Fincon Private Ltd. 11-Dec-08 4.00 4.00 Bullet-
11/03/2014
Rai And Sons Private Limited Employees Provident 11-Dec-08 4.00 4.00 Bullet-
Fund 11/03/2014
Mehta And Padamsey Private Limited Employees 11-Dec-08 2.00 2.00 Bullet-
provident Fund 11/03/2014
Mehta And Padamsey Surveyors Private Limited 11-Dec-08 2.00 2.00 Bullet-
staff Provident Fund 11/03/2014
Hirabai Vithaldas Shubh Trust 11-Dec-08 2.00 2.00 Bullet-
11/03/2014
The Metal Rolling Works Limited Employees 11-Dec-08 1.00 1.00 Bullet-
Educational Welfare Trust 11/03/2014
Sarvodaya Welfare Trust 11-Dec-08 1.00 1.00 Bullet-
11/03/2014
Hakamchand Vakhatram Philanthropic Trust 11-Dec-08 1.00 1.00 Bullet-
11/03/2014
Life Insurance Corporation Of India 23-Dec-08 100.00 100.00 Bullet-
23/03/2014
Karnataka Power Corporation Ltd Emp 23-Dec-08 100.00 100.00 Bullet-
Contributory Provident Fund Trust 23/03/2014
Maihar Cement Employees Provident Fund 29-Dec-08 30.00 30.00 Bullet-
29/12/2018

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Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of Disbursed As at Repayment
Allotment Amount March Terms
31, 2010
Century Textiles And Industries Ltd. (Cement 29-Dec-08 7.00 7.00 Bullet-
Divisions) Superannuation Fund 29/12/2018
Manikgarh Cement Employees Superannuation 29-Dec-08 4.00 4.00 Bullet-
Welfare Trust 29/12/2018
LIC of India - Gratuity Plus 17-Jan-09 500.00 500.00 Bullet-
17/04/2014
Bank of India 2-Apr-09 2,000.00 2,000.00 Bullet-
02/07/2014
Air- India Employees Provident Fund 2-Apr-09 500.00 500.00 Bullet-
02/07/2014
Hero Honda Motors Ltd 18-Apr-09 1,300.00 1,300.00 Bullet-
18/07/2014
The Indian Iron And Steel Co Ltd Provident 18-Apr-09 500.00 500.00 Bullet-
Institution 18/07/2014
Durgapur Steel Plant Provident Fund 18-Apr-09 200.00 200.00 Bullet-
18/07/2014
RKM Provident Fund 18-Apr-09 179.00 179.00 Bullet-
18/07/2014
Rameshwara Jute Mills Workers Provident Fund 18-Apr-09 100.00 100.00 Bullet-
trust 18/07/2014
Radha Govind Samiti 18-Apr-09 100.00 100.00 Bullet-
18/07/2014
Megna Jute Mills Provident Fund 18-Apr-09 27.00 27.00 Bullet-
18/07/2014
L And T (Kansbahal) Staff And Workmen 18-Apr-09 15.00 15.00 Bullet-
Provident Fund 18/07/2014
Hakamchand Vakhatram Philanthropic Trust 18-Apr-09 10.00 10.00 Bullet-
18/07/2014
Snehal Baid 18-Apr-09 10.00 10.00 Bullet-
18/07/2014
Bijay Singh Baid 18-Apr-09 10.00 10.00 Bullet-
18/07/2014
Sanjay Kumar Baid 18-Apr-09 10.00 10.00 Bullet-
18/07/2014
Wander Limited Employees Provident Fund 18-Apr-09 7.00 7.00 Bullet-
18/07/2014
Orient Ceramics Provident Fund Institution 18-Apr-09 7.00 7.00 Bullet-
18/07/2014
Burns Philp India Private Limited Employees 18-Apr-09 6.00 6.00 Bullet-
Provident Fund 18/07/2014
L & T (Kansbahal) Officers And Supervisory staff 18-Apr-09 6.00 6.00 Bullet-
Provident Fund 18/07/2014
Eskaps (India) Private Ltd. Employees Providend 18-Apr-09 5.00 5.00 Bullet-
fund 18/07/2014
Mehta And Padamsey Private Limited Employees 18-Apr-09 1.00 1.00 Bullet-
provident Fund 18/07/2014

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Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of Disbursed As at Repayment
Allotment Amount March Terms
31, 2010
ICICI Bank Ltd 15-Jul-09 3,920.00 3,920.00 Bullet-
10/10/2014
Chhattisgarh State Electricity Board Gratuity and 15-Jul-09 440.00 440.00 Bullet-
Pension Fund Trust 10/10/2014
Abn Amro Bank N V Employees' Provident Fund 15-Jul-09 150.00 150.00 Bullet-
10/10/2014
Aradhana Investments Ltd 15-Jul-09 100.00 100.00 Bullet-
10/10/2014
Cheviot Agro Industries Ltd 15-Jul-09 30.00 30.00 Bullet-
10/10/2014
R S R Mohota Spg And Wvg Mills Ltd Employees 15-Jul-09 20.00 20.00 Bullet-
provident Fund Trust Hinganghat 10/10/2014
Sunderdevi Baid 15-Jul-09 20.00 20.00 Bullet-
10/10/2014
Bela Anil Dalal 15-Jul-09 15.00 15.00 Bullet-
10/10/2014
Meenakshi Baid 15-Jul-09 15.00 15.00 Bullet-
10/10/2014
Aditya Share Dealings And Trading Private Limited 15-Jul-09 15.00 15.00 Bullet-
10/10/2014
Cheviot Company Limited Employees Gratuity Trust 15-Jul-09 10.00 10.00 Bullet-
fnd 10/10/2014
Amrish A Dalal 15-Jul-09 10.00 10.00 Bullet-
10/10/2014
Bijay Singh Baid 15-Jul-09 10.00 10.00 Bullet-
10/10/2014
Ganpati Share Cap Private Limited 15-Jul-09 10.00 10.00 Bullet-
10/10/2014
Mikasa Cosmetics Limited 15-Jul-09 30.00 30.00 Bullet-
10/10/2014
Nikhil Anil Dalal 15-Jul-09 15.00 15.00 Bullet-
10/10/2014
Jagdish Rani Basur 15-Jul-09 20.00 20.00 Bullet-
10/10/2014
Balkash Exim Pvt Ltd 15-Jul-09 140.00 140.00 Bullet-
10/10/2014
Desai Amit Sumanlal Huf 15-Jul-09 20.00 20.00 Bullet-
10/10/2014
Central Bank Of India 27-Oct-09 4,500.00 4,500.00 Bullet-
27/01/2015
NPS Trustees - LIC Pension Fund Scheme 1 27-Oct-09 1,310.00 1,310.00 Bullet-
27/01/2015
Trustees Hindustan Steel Limited Contributory 27-Oct-09 1,000.00 1,000.00 Bullet-
provident Fund, Rourkela 27/01/2015

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Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of Disbursed As at Repayment
Allotment Amount March 31, Terms
2010
Food Corporation Of India Cpf Trust 27-Oct-09 1,000.00 1,000.00 Bullet-
27/01/2015
Air- India Employees Provident Fund 27-Oct-09 600.00 600.00 Bullet-
27/01/2015
Allahabad Bank 27-Oct-09 500.00 500.00 Bullet-
27/01/2015
Dombivli Nagari Sahakari Bank Ltd 27-Oct-09 500.00 500.00 Bullet-
27/01/2015
Nps Trust - A/C Lic Pension Fund - Sg 27-Oct-09 200.00 200.00 Bullet-
Scheme1 27/01/2015
Gujarat Alkalies And Chemicals Ltd 27-Oct-09 160.00 160.00 Bullet-
Employees provident Fund Trust 27/01/2015
Sprism Investment Services P Ltd 27-Oct-09 85.00 85.00 Bullet-
27/01/2015
Sushilkumar N Trivedi 27-Oct-09 50.00 50.00 Bullet-
27/01/2015
Ashok Leyland Employees Hosur Provident 27-Oct-09 30.00 30.00 Bullet-
Fund trust 27/01/2015
Centre For Development Of Telematics 27-Oct-09 30.00 30.00 Bullet-
Employees Provident Fund Trust 27/01/2015
P Anusha 27-Oct-09 15.00 15.00 Bullet-
27/01/2015
The Municipal Co-Op Bank Empl Prov Fund 27-Oct-09 10.00 10.00 Bullet-
27/01/2015
Humphreys And Glasgow Directors 27-Oct-09 3.00 3.00 Bullet-
Superannuation Fund 27/01/2015
Orient Ceramics Provident Fund Institution 27-Oct-09 3.00 3.00 Bullet-
27/01/2015
R A Nariman And Co Ltd Employees Provident 27-Oct-09 2.00 2.00 Bullet-
Fund Trust 27/01/2015
A. K. Capital Services Ltd. 27-Oct-09 2.00 2.00 Bullet-
27/01/2015
United India Insurance Company Limited 31-Oct-09 2,000.00 2,000.00 Bullet-
31/10/2019
Bank Of India Provident Fund 31-Oct-09 500.00 500.00 Bullet-
31/10/2019
Air- India Employees Provident Fund 31-Oct-09 400.00 400.00 Bullet-
31/10/2019
The Kalyan Janata Sahakari Bank Ltd 24-Nov-09 500.00 500.00 Bullet-
22/11/2019
The Zoroastrian Co-Operative Bank Ltd 24-Nov-09 500.00 500.00 Bullet-
22/11/2019
The Jammu And Kashmir Bank Employee 24-Nov-09 400.00 400.00 Bullet-
Pension Fund Trust 22/11/2019

F-229
 Shriram Transport Finance Company Limited
Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of Disbursed As at Repayment
Allotment Amount March Terms
31, 2010
Engineers India Limited Employees Provident 24-Nov-09 300.00 300.00 Bullet-
Fund 22/11/2019
The Jammu And Kashmir Bank Employees 24-Nov-09 200.00 200.00 Bullet-
Provident Fund Trust 22/11/2019
Darashaw & Company Pvt Ltd 24-Nov-09 165.00 165.00 Bullet-
22/11/2019
Hooghly Docking Works Provident Fund 24-Nov-09 10.00 10.00 Bullet-
22/11/2019
Intervet India Pvt Ltd Employees Provident 24-Nov-09 10.00 10.00 Bullet-
Fund Trust 22/11/2019
A V George Group Employees Provident Fund 24-Nov-09 10.00 10.00 Bullet-
( Trustees ) 22/11/2019
Swan Silk Ltd Employees Provident Fund Trust 24-Nov-09 5.00 5.00 Bullet-
22/11/2019
Allianz Biosciences Pvt Ltd 31-Dec-09 100.00 100.00 Bullet-
31/12/2019
Youth Development Co Op Bank Ltd Kolhapur 31-Dec-09 100.00 100.00 Bullet-
31/12/2019
Trustees Hind Lamps Employees Provident 31-Dec-09 100.00 100.00 Bullet-
Fund ( Exempted Employees ) 31/12/2019
Caress Beauty Care Products Pvt Ltd 31-Dec-09 50.00 50.00 Bullet-
31/12/2019
Cool Cosmetics Private Limited 31-Dec-09 50.00 50.00 Bullet-
31/12/2019
Ashish Navin Shah 31-Dec-09 20.00 20.00 Bullet-
31/12/2019
Guljit Chaudhri 31-Dec-09 10.00 10.00 Bullet-
31/12/2019
Milan A Shah 31-Dec-09 10.00 10.00 Bullet-
31/12/2019
East Commercial Private Ltd. 31-Dec-09 10.00 10.00 Bullet-
31/12/2019
S Raja 31-Dec-09 5.00 5.00 Bullet-
31/12/2019
Orient Ceramics Provident Fund Institution 31-Dec-09 4.00 4.00 Bullet-
31/12/2019
Manju Pande 31-Dec-09 10.00 10.00 Bullet-
31/12/2019
Securities Trading Corporation Of India Limited 31-Dec-09 3,950.00 3,950.00 Bullet-
30/06/2015
Associated Capsules Private Limited 31-Dec-09 100.00 100.00 Bullet-
30/06/2015
All bank Finance Limited 31-Dec-09 100.00 100.00 Bullet-
30/06/2015
Keki Minoo Mistry 31-Dec-09 30.00 30.00 Bullet-
30/06/2015

F-230
 Shriram Transport Finance Company Limited
Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of Repayment Terms
Allotment Disbu
rsed As at
Amou March
nt 31, 2010
Mathrubhumi Employees Superannuation Fund 31-Dec-09 10.00 10.00 Bullet-30/06/2015
Virendra Ratilal Sangharajka 31-Dec-09 5.00 5.00 Bullet-30/06/2015
Ritu Modani 31-Dec-09 3.00 3.00 Bullet-30/06/2015
Usha Modani 31-Dec-09 2.00 2.00 Bullet-30/06/2015
Anu Khattar 31-Dec-09 1.00 1.00 Bullet-30/06/2015
Shriram Life Insurance Company Limited 6-Jan-10 300.00 300.00 Bullet-06/07/2015
Central Bank Of India 18-Jan-10 5,000. 5,000.00 Bullet-18/04/2015
00
Bank Of Maharashtra 22-Jan-10 1,000. 1,000.00 Bullet-22/04/2015
00
Food Corporation Of India Cpf Trust 22-Jan-10 200.00 200.00 Bullet-22/04/2015
A. K. Capital Services Ltd. 22-Jan-10 132.00 132.00 Bullet-22/04/2015
Gujarat Alkalies And Chemicals Ltd Employees 22-Jan-10 90.00 90.00 Bullet-22/04/2015
provident Fund Trust
Colgate- Palmolive (India) Ltd Provident Fund 22-Jan-10 50.00 50.00 Bullet-22/04/2015

Ashok Leyland Employees Hosur Provident 22-Jan-10 24.00 24.00 Bullet-22/04/2015

Fund trust
The Municipal Co-Op Bank Empl Prov Fund 22-Jan-10 4.00 4.00 Bullet-22/04/2015
Air- India Employees Provident Fund 29-Jan-10 700.00 700.00 Bullet-29/01/2020
Arvind Sahakari Bank Ltd 29-Jan-10 100.00 100.00 Bullet-29/01/2020
Loknete Dattaji Patil Sahkari Bank 29-Jan-10 50.00 50.00 Bullet-29/01/2020
Ltd.,Lasalgaon
Sulaimani Co Op. Bank Ltd. 29-Jan-10 40.00 40.00 Bullet-29/01/2020

B.M. Financial Services(India) Private limited 29-Jan-10 5.00 5.00 Bullet-29/01/2020

Huntsman Advanced Materials ( India ) Pvt Ltd 29-Jan-10 3.00 3.00 Bullet-29/01/2020
Employees Gratuity Fund

Petro Araldite Private Limited Employees 29-Jan-10 2.00 2.00 Bullet-29/01/2020

Provident Fund
Stci Primary Dealer Limited 29-Jan-10 990.00 990.00 Bullet-29/07/2015

F-231
 Shriram Transport Finance Company Limited
Annexure X
Unsecured Loans
( Rs in Lacs )
C Subordinated debts
Particulars Date of As at Repayment Terms
Allotment Disburse March 31,
d Amount 2010
Bank Of India Provident Fund 29-Jan-10 500.00 500.00 Bullet-29/07/2015
The Kalyan Janata Sahakari Bank Ltd 29-Jan-10 250.00 250.00 Bullet-29/07/2015
Model Co Op Bank Ltd 29-Jan-10 200.00 200.00 Bullet-29/07/2015
The Jain Sahakari Bank Limited 29-Jan-10 70.00 70.00 Bullet-29/07/2015
Nandlal Pribhdas Tolani 29-Jan-10 50.00 50.00 Bullet-29/07/2015
Icb Ltd Employees Provident Fund 29-Jan-10 10.00 10.00 Bullet-29/07/2015
Hema Parameswaran 29-Jan-10 2.00 2.00 Bullet-29/07/2015
Vijaya R K 29-Jan-10 1.00 1.00 Bullet-29/07/2015
T P Viswanathan 29-Jan-10 1.00 1.00 Bullet-29/07/2015
Avinash Chandra Sangal 29-Jan-10 2.00 2.00 Bullet-29/07/2015
Lotus Beauty Care Products Pvt Ltd 15-Feb-10 100.00 100.00 Bullet-15/02/2020
KOTAK Mahindra Bank Ltd 29-Mar-10 5,000.00 5,000.00 Bullet-29/09/2015
80,097.00 80,097.00
D Term Loan from Banks
Particulars Date of As at Repayment Terms
Allotment Disburse March 31,
d Amount 2010
ICICI Bank 11-Sep-09 10,000.00 10,000.00 Bullet-11/03/2011
HSBC Bank 21-Sep-07 22,500.00 8,000.00 3 unequal
installment
HSBC Bank 29-Oct-09 52,647.21 52,647.21 Various dt from
26/07/10 to
26/07/12
85,147.21 70,647.21
E Term Loan from Instituition
Particulars Date of As at Repayment Terms
Allotment Disburse March 31,
d Amount 2010
KOTAK Mahindra Prime Ltd 20-Mar-07 7,500.00 7,500.00 Bullet-22/09/2010
KOTAK Mahindra Prime Ltd 16-Mar-07 11,000.00 11,000.00 Bullet-16/06/2010
KOTAK Mahindra Prime Ltd 30-Mar-07 16,500.00 16,500.00 Bullet-30/06/2010
35,000.00 35,000.00

F-232
Shriram Transport Finance Company Limited
Annexure X
Unsecured Loans
( Rs in Lacs )
F Inter corporate Deposits
Particulars Date of Repayment Terms
Allotment Disbursed As at March 31,
Amount 2010
Shakti Finance 13-Feb-08 31.68 4.43 12 Quarterly installments
Shakti Finance 26-Feb-08 88.97 12.25 16 Quarterly installments
120.65 16.68

G Fixed Deposits - Retail 11,479.51 Redeemable at par over a

Investors period 12 to 60 months
H Subordinated Debts - Retail 126,502.49 Redeemable at par over a
Investors period 61 to 88 months
Total Unsecured 328,742.89
Loans(A+B+C+D+E+F+G
+H)

Notes:
1 Terms as regards Interest/Pre-payment:
a The Fixed Interest bearing Loans/Commercial Paper/Non-convertible debentures/Subordinated Debt/Fixed
Deposit/Inter corporate Deposits aggregate to Rs. 233,595.68 Lacs and the floating interest bearing
Loans/Subordinated Debts aggregate to Rs. 95,147.21 Lacs.
b Loans aggregating to Rs. 35,000.00 Lacs have an interest reset option.
c Loans aggregating to Rs. 53,000.00 Lacs have a Pre-payment option upon payment of stipulated charges.
2 The Public Deposits may be foreclosed subject to applicable statutory and/or regulatory requirements.

3 The company may, subject to applicable statutory and/or regulatory requirements, grant loan against the security
of Public Deposits upon the terms and conditions as may be decided by the company.

F-233
Shriram Transport Finance Company Limited

Consolidated Capitalization Statement Annexure XI

(Rs. in Lacs)

Pre issue as at March As adjusted for issue

31, 2010 (Audited)
Particulars

Debt

122,829.76 122,829.76
Short Term Debt

1,723,161.21 1,773,161.21
Long Term Debt

1,845,990.97 1,895,990.97
Total

Share holders Fund

22,554.18 22,554.18
Share Capital
5.22 5.22
Share application money pending allotment
757.02 757.02
Stock Option Outstanding
361,095.63 361,095.63
Reserves & Surplus (Refer Annexure IV - Schedule 10)
3,708.69 3,708.69
Less: Miscellaneous Expenditure

380,703.36 380,703.36
Total of Share holders Fund

Long Term Debt /Equity Ratio 4.53 4.66

F-234
 Annexure XII
Shriram Transport Finance Company Limited.
Consolidated Statement of Tax Shelter
(Rs in Lacs)
For Nine Year ended March For Nine months ended
Particulars 31, 2010 December 31, 2009
Profit as per accounting books 132,456.74 91,191.47
Tax Rate 33.99% 33.99%
Tax on Accounting Profit 45,022.04 30,995.98

Permanent Differences

Donation 80.90 25.75

Exempt Dividend Income (874.71) (874.71)
Disallowance u/s 14A 322.40 322.39
Capital gains on sale of fixed assets 5,975.27 5,975.27
Others 2,584.02 296.10
Sub Total (A) 8,087.88 5,744.80
Temporary Differences

Disallowances U/s 43B 146.44 119.59

Depreciation and Lease adjustments 401.95 394.58
Deferred Revenue Expenses (2,217.22) (3,543.21)
Delinquency Provision for Securitisation 7,981.41 3,324.03
Others 186.64 122.71
Sub Total (B) 6,499.22 417.70

Net Adjustments (A+B) 14,587.10 6,162.50

Tax Impact on Net Adjustments 4,958.15 2,094.63

Total Taxation 49,980.20 33,090.61
Current Tax Provision for the year 49,980.20 33,090.61

Notes:

1. Profits after tax are often affected by the tax shelters which are available.

2. Some of these are of a relatively permanent nature while others may be limited in point of time.

3. Tax provisions are also affected by timing differences which can be reversed in future.

F-235
Schedules forming part of Consolidated Summary Financial Statements

Annexure XIII
Significant Accounting Policies

(a) Basis of preparation

The Consolidated financial statements relates to M/s. Shriram Transport Finance Company Limited (the
Company), its subsidiary companies and associate. The Company, its subsidiary companies and
associate constitute the Group. The financial statements have been prepared in conformity with
generally accepted accounting principles to comply in all material respects with the notified Accounting
Standards (‘AS’) under Companies Accounting Standard Rules, 2006, as amended, the relevant
provisions of the Companies Act, 1956 (‘the Act’) and the guidelines issued by the Reserve Bank of
India (‘RBI’) as applicable to a Non Banking Finance Company (‘NBFC’). The financial statements
have been prepared under the historical cost convention on an accrual basis.

(b) Basis of consolidation

(i) The financial statements of the subsidiary companies used in the consolidation are drawn upto the same
reporting date as of the Company i.e. year ended March 31, 2010 and are prepared based on the
accounting policies consistent with those used by the Company.
(ii) The financial statements of the Group have been prepared in accordance with the Accounting Standard
21- ‘Consolidated Financial Statements’ and Accounting Standard 23 – ‘Accounting for investments in
Associates in Consolidated Financial Statements, notified under the Companies (Accounting Standards)
Rules, 2006, as amended and other generally accepted accounting principles in India.
(iii)
The consolidated financial statements have been prepared on the following basis :

1. The financial statements of the company and its subsidiary companies have been combined on a line-
by-line basis by adding together like items of assets, liabilities, income and expenses. The intra-group
balances and intra-group transactions and unrealized profits or losses have been fully eliminated.
2. The consolidated financial statements include the share of profit / loss of the associate company which
has been accounted as per the ‘Equity method’, and accordingly, the share of profit / loss of the
associate company (the loss being restricted to the cost of investment) has been added to / deducted
from the cost of investments. An Associate is an enterprise in which the investor has significant
influence and which is neither a Subsidiary nor a Joint Venture of the Investor.
3. The excess of cost to the Company of its investments in the subsidiary companies over its share of
equity of the subsidiary companies, at the dates on which the investments in the subsidiary companies
are made, is recognized as ‘Goodwill’ being an asset in the consolidated financial statements.
Alternatively, where the share of equity in the subsidiary companies as on the date of investment is in
excess of cost of investment of the Company, it is recognized as ‘Capital Reserve’ and shown under the
head ‘Reserves and Surplus’, in the consolidated financial statements.
4. Minority interest in the net assets of consolidated subsidiaries consists of the amount of equity
attributable to the minority shareholders at the dates on which investments are made by the Company in
the subsidiary companies and further movements in their share in the equity, subsequent to the dates of
investments as stated above.
(iv) The following subsidiary companies are considered in the consolidated financial statements:
Sr. Name of the Subsidiary Company Country of % of holding either directly as at
No. incorporation
March 31, 2010

1. Shriram Asset and Equipment Finance India -

Private Limited (From June 04, 2009 to
December 14, 2009)
F-236
2. Shriram Equipment Finance Company India 100%
Limited (w.e.f. December 15, 2009)
3. Shriram Automall India Limited (w.e.f. India 100%
February 11, 2010)
(v ) The details of associate company are as follows :
Sr. Name of the Associate Company Country of Share of ownership interest as at
No. incorporation
March 31, 2010

1. Shriram Asset Management Company India 40.00%

Limited
(c) Use of estimates
The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of
operations during the reporting year end. Although these estimates are based upon management’s best
knowledge of current events and actions, actual results could differ from these estimates. Any revisions
to the accounting estimates are recognized prospectively in the current and future years.

(d) Fixed Assets, Depreciation/Amortisation and Impairment of assets

Fixed Assets
Fixed assets include the assets given on operating lease. Fixed assets are stated at cost less accumulated
depreciation/amortisation and impairment losses, if any. Cost comprises the purchase price and any
attributable cost of bringing the asset to its working condition for its intended use. Borrowing costs
relating to acquisition of fixed assets which takes substantial period of time to get ready for its intended
use are also included to the extent they relate to the period till such assets are ready to be put to use.

Depreciation/Amortisation
Depreciation/Amortisation is provided on Straight Line Method (‘SLM’), which reflect the
management’s estimate of the useful lives of the respective fixed assets and are greater than or equal to
the corresponding rates prescribed in Schedule XIV of the Act. The assets for which rates higher used are
as follows :

F-237
 Particulars Rates (SLM) Schedule XIV rates (SLM)
Windmills 10% 5.28%
Computer Software 33.33% 16.67%

Windmills are amortised over the remaining life of the asset, the life of windmills are estimated to be 10
years.

Leasehold improvement is amortised over the primary period of lease subject to a maximum of 60
months.

All fixed assets individually costing Rs. 5,000 or less are fully depreciated in the year of installation.

Depreciation on assets sold during the year is recognized on a pro-rata basis to the profit and loss
account till the date of sale.

Impairment of assets
The carrying amount of assets is reviewed at each balance sheet date if there is any indication of
impairment based on internal/external factors. An impairment loss is recognized wherever the carrying
amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets,
net selling price and value in use. In assessing value in use, the estimated future cash flows are
discounted to their present value at the weighted average cost of capital.
After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining
useful life.
A previously recognized impairment loss is increased or reversed depending on changes in
circumstances. However the carrying value after reversal is not increased beyond the carrying value that
would have prevailed by charging usual depreciation if there was no impairment.
(e) Investments
Investments intended to be held for not more than a year are classified as current investments. All other
investments are classified as long-term investments. Current investments are carried at lower of cost and
market value / realizable value determined on an individual investment basis. Long-term investments are
carried at cost. However, provision for diminution in value is made to recognise a decline, other than
temporary, in the value of the investments.
(f) Provisioning / Write-off of assets
Loans and lease receivables are written off / provided for, as per management estimates, subject to the
minimum provision required as per Non- Banking Financial (Deposit Accepting or Holding) Companies
Prudential Norms (Reserve Bank) Directions, 2007. Delinquencies on assets securitized are provided for
based on management estimates.
(g) Hypothecation loans
Hypothecation loans are stated at the amount advanced including finance charges accrued and expenses
recoverable, as reduced by the amounts received up to the balance sheet date and loans securitized.
(h) Leases
Where the Company is the lessor
Assets given under a finance lease are recognised as a receivable at an amount equal to the net
investment in the lease. Lease rentals are apportioned between principal and interest on the internal rate
of return (‘IRR’). The principal amount received reduces the net investment in the lease and interest is
recognised as revenue. Initial direct costs are recognised immediately in the Profit and Loss Account.
Assets given on operating lease are included in fixed assets. Lease income is recognised in the Profit and
F-238
 Loss Account on a straight-line basis over the lease term. Costs, including depreciation are recognised as
an expense in the Profit and Loss Account. Initial direct costs such as legal costs, brokerage costs, etc.
are recognised immediately in the Profit and Loss Account.
Where the Company is the lessee
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the
leased term, are classified as operating leases. Operating lease payments are recognized as an expense in
the Profit and Loss account on a straight-line basis over the lease term.
(i) Foreign currency translation
Initial recognition
Transactions in foreign currency entered into during the year are recorded at the exchange rates
prevailing on the date of the transaction.
Conversion
Monetary assets and liabilities denominated in foreign currency are translated in to Rupees at exchange
rate prevailing on the date of the Balance Sheet.
Exchange differences
All exchange differences are dealt with in the profit and loss account.
(j) Inventories
Inventories are valued as follows:
Raw materials, components, stores and spares:
Lower of cost and net realizable value. Cost is determined on a weighted average basis. Net realizable
value is the estimated selling price in the ordinary course of business, less estimated costs of completion
and estimated costs necessary to make the sale.

(k) Revenue recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the
Company and the revenue can be reliably measured.
i. Finance and service charges on financial lease/ loans is recognised on the basis of internal rate of return.
ii. Income recognized and remaining unrealized after installments become overdue for six months or more
in case of secured loans and twelve months or more in case of financial lease transactions are reversed
and are accounted as income when these are actually realized.
iii. Additional finance charges / additional interest are treated to accrue only on realization, due to
uncertainty of realization and are accounted accordingly.
iv. Gains arising on securitization/direct assignment of assets is recognized over the tenure of agreements as
per guideline on securitization of standard assets issued by RBI, loss, if any is recognised upfront.
v. Income from power generation is recognized on supply of power to the grid as per the terms of the Power
Purchase Agreements with State Electricity Boards.
vi. Income from services is recognized as per the terms of the contract on accrual basis.
vii. Interest income on fixed deposits/margin money, call money (CBLO), certificate of deposits and pass
through certificates is recognized on a time proportion basis taking into account the amount outstanding
and the rate applicable.
viii. Dividend is recognized as income when right to receive payment is established by the date of balance
sheet.
ix. Profit/loss on the sale of investments is recognized at the time of actual sale/redemption.
x. Income from operating lease is recognized as rentals, as accrued on straight line basis over the period of
the lease.

F-239
(l) Employee benefits
Provident Fund
All the employees of the Company are entitled to receive benefits under the Provident Fund, a defined
contribution plan in which both the employee and the Company contribute monthly at a stipulated rate.
The Company has no liability for future Provident Fund benefits other than its annual contribution and
recognizes such contributions as an expense in the period it is incurred.
Gratuity
The Company provides for the gratuity, a defined benefit retirement plan covering all employees. The
plan provides for lump sum payments to employees at retirement, death while in employment or on
termination of employment. The Company accounts for liability of future gratuity benefits based on an
external actuarial valuation on projected unit credit method carried out annually for assessing liability as
at the reporting date.
Leave Encashment
Short term compensated absences are provided for based on estimates. Long term compensated absences
are provided for based on actuarial valuation. The actuarial valuation is done as per projected unit credit
method as at the reporting date.
Actuarial gains/losses are immediately taken to profit and loss account and are not deferred.

(m) Income tax

Tax expense comprises of current and deferred tax. Current income tax is measured at the amount
expected to be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961. Deferred
income taxes reflects the impact of current year timing differences between taxable income and
accounting income for the year and reversal of timing differences of earlier years.
Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the
balance sheet date. Deferred tax assets are recognized only to the extent that there is reasonable certainty
that sufficient future taxable income will be available against which such deferred tax assets can be
realized. In situations where the Company has unabsorbed depreciation or carry forward tax losses, all
deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that
they can be realized against future taxable profits.

The un-recognized deferred tax assets are re-assessed by the Company at each balance sheet date and are
recognized to the extent that it has become reasonably certain or virtually certain, as the case may be that
sufficient future taxable income will be available against which such deferred tax assets can be realized.

The carrying cost of the deferred tax assets are reviewed at each balance sheet date. The Company writes
down the carrying amount of a deferred tax asset to the extent that it is no longer reasonably certain or
virtually certain, as the case may be, that sufficient future taxable income will be available against which
deferred tax asset can be realized. Any such write down is reversed to the extent that it becomes
reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be
available.

F-240
(n) Segment reporting policies

Identification of segments:
The Company’s operating businesses are organized and managed separately according to the nature of
products and services provided, with each segment representing a strategic business unit that offers
different products and serves different markets. The analysis of geographical segments is based on the
areas in which major operating divisions of the Company operate.
Unallocated items:
Unallocated items include income and expenses which are not allocated to any reportable business
segment.
Segment Policies :
The company prepares its segment information in conformity with the accounting policies adopted
for preparing and presenting the financial statements of the company as a whole.
(o) Earnings per share
Basic earnings per share is calculated by dividing the net profit or loss for the period attributable to
equity shareholders (after deducting attributable taxes) by the weighted average number of equity shares
outstanding during the year.
For the purpose of calculating diluted earnings per share, the net profit or loss for the period attributable
to equity shareholders and the weighted average number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity shares.

(p) Provisions
A provision is recognised when the company has a present obligation as a result of past event; it is
probable that outflow of resources will be required to settle the obligation, in respect of which a reliable
estimate can be made. Provisions are not discounted to its present value and are determined based on best
estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance
sheet date and adjusted to reflect the current best estimates.

(q) Cash and cash equivalents

Cash and cash equivalents in the cash flow statement comprise cash at bank and in hand, cheques on
hand, remittances in transit and short term investments with an original maturity of three months or less.

(r) Equity shares and Debentures issue expenses

Issue expenses incurred on issue of equity shares are charged on a straight line basis over a period of 10
years.
Public issue expenses incurred on issue of debentures are charged off on a straight line basis over the
weighted average tenor of underlying debentures.

(s) Ancillary cost of borrowings

Ancillary cost of borrowings are charged to Profit & Loss account in the year in which they are incurred.

(t) Employee stock compensation costs

Measurement and disclosure of the employee share-based payment plans is done in accordance with
SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and the
Guidance Note on Accounting for Employee Share-based Payments, issued by ICAI. The Company
measures compensation cost relating to employee stock options using the intrinsic value method.
Compensation expense is amortized over the vesting period of the option on a straight line basis.

F-241
Notes to Accounts for the year 2009-2010
1. Secured Loans

a) (i) Privately placed Redeemable Non-convertible Debentures of Rs.1,000/- each

As at March 31, 2010
Number 1,88,70,314
Amount Rs in lacs 1,88,703.14

Secured by equitable mortgage of title deeds of immovable property. Further secured by charge on plant and
machinery, furniture and other fixed assets of the Company, charge on Company’s hypothecation loans, other
loans, advances and investments of the Company subject to prior charges created or to be created in favour of
the Company’s bankers, financial institutions and others.

Debentures are redeemable at par over a period of 12 months to 160 months from the date of allotment
depending on the terms of the agreement. The earliest date of redemption is 01.04.2010

Debentures may be bought back subject to applicable statutory and/or regulatory requirements, upon the terms
and conditions as may be decided by the Company. The Company may grant loan against the security of NCDs
upon the terms and conditions as may be decided by the Company

(ii) Privately Placed Redeemable Non-Convertible Debenture of Rs.1,000,000/- each

Amount (Rs. in lacs) Redeemable at par on

Date of
Allotment/renewal As at March 31, 2010
05.07.2007 5,000.00 05.07.2010

09.07.2007 7,000.00 09.07.2010

11.07.2007 1,000.00 09.07.2010

25.07.2007 10,000.00 25.07.2010

25.07.2007 2,500.00 25.07.2010

10.09.2007 2,500.00 10.09.2010

15.10.2007 2,000.00 15.10.2010

18.10.2007 3,900.00 18.10.2010

19.10.2007 5,000.00 19.10.2010

F-242
 02.05.2008 15,000.00 02.05.2011

Amount (Rs. in lacs) Redeemable at par on

Date of
Allotment/renewal As at March 31, 2010
20.06.2008 10,000.00 20.06.2011

04.09.2008 10,000.00 04.09.2010

08.09.2008 3,000.00 08.09.2010

15.09.2008 1,500.00 15.09.2011

15.09.2008 1,500.00 15.09.2010

15.09.2008 2,500.00 15.09.2010

15.09.2008 1,500.00 30.04.2010

16.09.2008 2,500.00 16.09.2011

17.09.2008 8,000.00 01.09.2011

24.09.2008 2,500.00 24.09.2010

26.09.2008 2,500.00 26.09.2010

26.09.2008 1,500.00 10.09.2010

08.10.2008 1,200.00 06.04.2010

24.10.2008 5,000.00 10.12.2010

03.11.2008 30,000.00 03.11.2013

26.11.2008 1,000.00 26.11.2013

28.03.2009 5,000.00 28.03.2012

*13.04.2009 10,000.00 13.04.2011

**20.04.2009 2,500.00 20.04.2011

17.06.2009 2,500.00 17.06.2011

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 30.06.2009 25,000.00 30.06.2011

Date of Amount (Rs. in lacs)

Allotment/renewal
As at March 31, 2010 Redeemable at par on

14.09.2009 1,500.00 05.04.2011

12.10.2009 9,000.00 12.04.2011

24.03.2010 2,400.00 24.03.2011

25.03.2010 2,600.00 25.03.2011

TOTAL 198,600.00

Secured by specific assets covered under hypothecation loan agreements and by way of exclusive charge and
equitable mortgage of title deeds of immovable property.
*Put/call option on April 13, 2010
**Put/call option on April 20, 2010

Debentures may be bought back subject to applicable statutory and/or regulatory requirements, upon the terms
and conditions as may be decided by the Company.

(iii) Public issue of Redeemable Non-convertible Debentures of Rs.1,000/- each

Redeemable at
Amount (Rs. in lacs) par on Put and Calloption

Date of
Allotment/renewal As at March 31, 2010
Option -I 3,489.95 26.08.2012 -
Option -I 3,489.95 26.08.2013 -
Option -I 1,744.97 26.08.2014 -
Option -II 2,949.84 26.08.2012 -
Option -II 2,949.84 26.08.2013 -
Option -II 1,474.92 26.08.2014 -
Option -III 10,422.51 26.08.2014 26.08.2013
Option -IV 2,274.12 26.08.2014 26.08.2013
Option -V 66,988.63 26.08.2012 -

Total 95,784.73

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a. Secured by specific assets covered under hypothecation loan agreements and by way of exclusive charge
and equitable mortgage of title deeds of immovable property.

b. The proceeds of public issue of Non convertible debentures have been utilised for financing activities.

c. Debentures may be bought back subject to applicable statutory and/or regulatory requirements, upon the
terms and conditions as may be decided by the Company. The Company may grant loan against the
security of NCDs upon the terms and conditions as may be decided by the Company

F-245
b) Term Loans :
(Rs. in lacs)
As at March 31, 2010
i. From Financial Institutions / Corporates :

(a) Secured by an exclusive charge by way of

hypothecation of specific movable assets being
12,188.42
fixed/current assets relating to hypothecation loans
Total 12,188.42

(Rs. in lacs)

ii. From Banks : As at March 31, 2010

(a) Secured by hypothecation of vehicles 3.19

(b) Secured by an exclusive charge by way of
hypothecation of specific movable assets being fixed / 929,931.95
current assets relating to hypothecation loans*
Total 929,935.14

*includes Rs.20,000.00 lacs the charge in respect of which has since been created and Rs.47,000 lacs on
which charges are yet to be created.

c) Cash Credit from Banks

(Rs. in lacs)

As at March 31, 2010

Cash Credit from banks * 92,036.64

Secured by hypothecation of specific assets covered under hypothecation loan agreements.
*Includes Rs.10,000.00 lacs the charge in respect of which has since been created.

2. Subordinated Debt
The Company has raised capital by issue of subordinated debt bonds amounting to Rs.53,196.13 Lacs
with coupon rate of 9.5% to 13% per annum which are redeemable over a period of 62 months to 122
months.

3.
Final dividend (including tax on dividend) includes an amount of Rs 380.45 lacs in respect of
dividend paid by the Company for the year ended March 31, 2009 on 81,29,550 equity shares as these
have been allotted before the record date for declaration of dividend for the year ended March 31,
2009, and they rank pari-passu with the existing equity shares for dividend.

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 4. Gratuity and other post-employment benefit plans:
The Company has an unfunded defined benefit gratuity plan. Every employee who has completed five
years or more of service is eligible for a gratuity on sespartion at 15 days salary (last drawn salary) for
each completed year of service.
Consequent to the adoption of revised AS 15 ‘Employee Benefits’ issued under Companies
Accounting Standard Rules, 2006, as amended, the following disclosures have been made as required
by the standard:

Profit and Loss account

Net employee benefit expense (recognized in employee cost) (Rs. in lacs)
Gratuity
Particulars March 31, 2010
Current service cost
191.23
Interest cost on benefit obligation 48.79
Expected return on plan assets NA
Net actuarial (gain) / loss recognised in the year (42.37)
Past service cost Nil
Net benefit expense 197.65

Balance sheet
Details of Provision for gratuity (Rs. in lacs)
Gratuity
Particulars March 31, 2010
Defined benefit obligation 612.63
Fair value of plan assets NA
612.63
Less: Unrecognised past service cost Nil
Plan asset / (liability) (612.63)

Changes in the present value of the defined benefit obligation are as follows:
(Rs. in lacs)
Gratuity
Particulars March 31, 2010
Opening defined benefit obligation 463.92
Interest cost 48.79
Current service cost 191.23
Benefits paid (48.93)
Actuarial (gains) / losses on obligation (42.38)
Closing defined benefit obligation 612.63

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The Company would not contribute any amount to gratuity in 2010-11 as the scheme is unfunded.
The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
Gratuity
Particulars March 31, 2010
%
Investments with insurer NA
The principal assumptions used in determining gratuity obligations for the Company’s plan are shown below:
Gratuity
Particulars March 31, 2010
Discount Rate 7.5%
Increase in compensation cost 5%
Employee Turnover* 5% and 10%
The estimates of future salary increases, considered in actuarial valuation, are on account of inflation, seniority,
promotion and other relevant factors, such as supply and demand in the employment market.
*5% in case of employees with service period of more than 5 years and 10% for all other employees.

Amounts for the current year are as follows: (Rs. in lacs)

Particulars March 31, 2010
Defined benefit obligation 612.63
Plan assets NA
Surplus / (deficit) (612.63)
Experience adjustments on plan liabilities 55.56
Experience adjustments on plan assets NA

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5. The Company is primarily engaged in financing activities. It operates in a single business and geographical
segment. The Company owned windmills and biomass which generate income from sale of electricity and
also earned certain fee based income, these income have been classified as ‘Unallocated reconciling item’
as per requirements of AS – 17 on ‘Segment Reporting’.
(Rs in lacs)
Year ended March 31, 2010
Particulars Unallocated reconciling
Financing Activities Total
items
Segment Revenue
446,280.41 3,688.23 449,968.64
Segment Results (Profit before
tax and after interest on
Financing Segment)
129,275.69 3,468.20 132,743.89
Less: Interest on unallocated
reconciling items - 287.14 287.14
Net profit before tax 129,275.69 3,181.06 132,456.75
Less: Income taxes 45,146.74
Net profit after tax 87,310.01
Other Information:
Year ended March 31, 2010
Particulars Unallocated reconciling
Financing Activities Total
items
Segment assets 2,690,346.95 - 2,690,346.95
Unallocated corporate assets - - 7,472.94
Total Assets 2,690,346.95 - 2,697,819.89
Segment liabilities 2,312,419.48 - 2,312,419.48
Unallocated corporate
liabilities - - 988.35
Total Liabilities 2,312,419.48 - 2,313,407.83
Capital expenditure 629.41 - 629.41
Depreciation 1,287.84 208.00 1,495.84
Other non - cash expenses 49,753.00 0.94 49,753.94

F-249
6. Related Party Disclosure

Related party where control exists

Other Related Parties

Enterprises having significant influence Shriram Holdings (Madras) Private Limited

over the Company : Shriram Capital Limited
Newbridge India Investments II Limited

Associates : Shriram Asset Management Company Limited

Key Managerial Personnel : R Sridhar, Managing Director

Relatives of Key Managerial Personnel : Mrs. Padmapriya Sridhar (spouse)

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 (Rs. in lacs)
Enterprises having Relatives of Key
significant influence Key Management Management
over the Company Associates Personnel Personnel Total
March 31, 2010 March 31, 2010 March 31, 2010 March 31, 2010 March 31, 2010

Payments/Expenses
Employee benefits for key management - - 72.61 - 72.61
personnel
Royalty 1,240.78* - - - 1,240.78
Data Sourcing fees 23.96* - - - 23.96
Service Charges 143.75* - - - 143.75
Reimbursement of business promotion expenses 66.18* - - - 66.18
Equity dividend 5,602.29# - 5.58 2.43 5,610.30
Interest on subordinate debt - 54.37 - - 54.37
Interest on Inter Corporate Deposit 96.66# - - - 96.66
Interest on Non Convertible Debentures - - 0.27 0.01 0.28
Rent paid 59.56* - - - 59.56
Inter Corporate Deposits 4,200# - - - 4,200.00
Receipts/Income
Non Convertible Debenture - - 1.00 1.00 2.00
Issue of equity shares on conversion of warrants 2,400.00# - - - 2,400.00
Rent & electricity reimbursed - 5.25 - - 5.25
Balance Outstanding at the year end
Share capital 9,337.15# - 13.02 4.05 9,354.22
Investment in shares - 240.00 - - 240.00
Outstanding expenses 185.43 * - - - 185.43
Rent Deposit given 49.00* - - - 49.00
Subordinated debts - 413.40 - - 413.40
Interest payable on subordinate debt - 85.78 - - 85.78

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 * Denotes transactions with Shriram Capital Limited
# Denotes transactions with Shriram Holdings (Madras) Private Limited

7. Leases

In case of assets given on lease

The Company has given land and building on operating lease for period ranging 11 months to 60
months. During the year , the company had also given its biomass plant on operating lease for the
period 1st April, 2009 to 30th September, 2009. The same was sold on October 1, 2009, hence gross
carrying cost of and accumulated depreciation of the asset as on the date of balance sheet is nil.

In case of assets taken on lease

The Company has taken various office premises, furniture and fixtures, computers and plant and
machinery under operating lease. The lease payments recognized in the profit & loss account are
Rs.3,557.92 lacs . Certain agreements provide for cancellation by either party and certain agreements
contains clause for escalation and renewal of agreements. The non-cancellable operating lease
agreements are ranging for a period 22 to 122 months. There are no restrictions imposed by lease
arrangements. There are no sub leases.
The future minimum lease payments in respect of non-cancellable operating lease as at the balance
sheet date are summarized below :

(Rs. in lacs)
As at March 31, 2010
Minimum Lease Payments:
Not later than one year 899.73
Later than one year but not later than five years 324.11
Later than five years 40.73

8.
In accordance with the Reserve Bank of India circular no.RBI/2006-07/ 225 DNBS (PD) C.C No.
87/03.02.004/2006-07 dated January 4, 2007, the Company has created a floating charge on the
statutory liquid assets comprising of investment in Government Securities to the extent of Rs.3,497.70
lacs in favour of trustees representing the public deposit holders of the Company.

F-252
9. Earnings per share

Particulars Year ended March 31,

2010
Net Profit after tax, Minority interest and Share of loss of Associates as
87,302.56
per profit and loss account (Rs. in lacs) (A)
Weighted average number of equity shares for calculating Basic EPS
2125.01
(in lacs) (B)
Weighted average number of equity shares for calculating Diluted EPS
2133.85
(in lacs) (C)
Basic earnings per equity share (in Rupees) (Face value of Rs. 10/- per
41.08
share) (A) / (B)
Diluted earnings per equity share (in Rupees) (Face value of Rs. 10/-
per share) (A) / (C) 40.91

Year ended March 31,

Particulars 2010
Weighted average number of equity shares for calculating EPS (in lacs) 2,125.01
Add : Equity shares arising on conversion of optionally convertible
0.00
warrants (in lacs)
Add : Equity shares for no consideration arising on grant of stock
8.84
options under ESOP (in lacs)
Weighted average number of equity shares in calculation diluted EPS
(in lacs) 2,133.85

10. Deferred Tax Liabilities/(Asset)(Net) (Rs. in lacs)

The break up of deferred tax asset / liabilities is as under:-
As at March 31, 2010

Deferred Tax Liabilities

Timing difference on account of :
Differences in depreciation in block of fixed assets as per
Nil
tax books and financial books
Debenture Issue Expenses 753.63
Gross Deferred Tax Liabilities (A) 753.63
Deferred Tax Asset
Timing difference on account of :
Differences in depreciation in block of fixed assets as per
231.78
tax books and financial books
Expenses disallowed under Income Tax Act, 1961 3,260.74
Provision for securitization 4,734.05
Gross Deferred Tax Assets (B) 8,226.57

F-253
 Deferred Tax Liabilities /(Assets)(Net) (A-B) (7,472.94)
(Rs in lacs)
As at March 31, 2010
11. Contingent Liabilities not provided for

a. Disputed income tax/interest tax demand contested in 157.26

appeals not provided for
[Against the above, a sum of Rs. 29.66 lacs has been paid
under protest]
b. Demands in respect of Service tax 315.00
[Amount of Rs.15.00 lacs has been paid under protest ]

c. Disputed sales tax demand 412.33

[Amount of Rs. 63.92 lacs has been paid by the Company]

Future cash outflows in respect of above are determinable only on receipt of judgements /decisions
pending with various forums/authorities.

12.
Recovery of Service tax on lease and hire purchase transactions is kept in abeyance in view of the
petition pending before the Supreme Court of India. If any liability arises it will be recovered from
the concerned parties. However, on contracts that have been terminated, pending the decision from
the Supreme Court of India, equivalent service tax is written off. The company has recognized the
deferred tax asset on the amounts so written off, as in either case service tax liability will be charged
off or reversed as income.

13. Employee Stock Option Plan

Series I Series II Series III Series IV Series V Series VI
Date of grant October April 1, October 9, August 17, July May 13,
31, 2005 2006 2006 2007 15,2008 2009
Date of May 13,
October February September August 17, July
Board/committee 2009
19, 2005 22, 2006 6, 2006 2007 15,2008
Approval
Date of October
October October October October 13, October
Shareholder’s 13, 2005
13, 2005 13, 2005 13, 2005 2005 13, 2005
approval
Number of
2,962,500 832,500 910,000 109,000 77,000 50,000
options granted
Method of
Settlement Equity Equity Equity Equity
Equity Equity
(Cash/Equity)
Graded Vesting Period
After 1 year of 10% of 10% of 10% of 10% of 10% of 10% of
grant date options options options options options options
granted granted granted granted granted granted
After 2 years of 20% of 20% of 20% of 20% of 20% of 20% of
grant date options options options options options options
granted granted granted granted granted granted
After 3 years of 30% of 30% of 30% of 30% of 30% of 30% of
grant date options options options options options options
granted granted granted granted granted granted
After 4 years of 40% of 40% of 40% of 40% of 40% of 40% of
grant date options options options options options options
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 granted granted granted granted granted granted
Exercisable 10 years 10 years 10 years 10 years 10 years 10 years
period from from from from from from vesting
vesting vesting vesting vesting vesting date
date date date date date
Vesting On achievement of predetermined targets.
Conditions

The details of Series I have been summarized below:

As at March 31,2010
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the year 1,839,800 Rs. 35.00
Add: Granted during the year - -
Less: Forfeited during the year - -
Less: Exercised during the year 16,40,750 Rs.35.00
Less: Expired during the year 9,500 -
Outstanding at the end of the year 1,89,550 Rs.35.00
Exercisable at the end of the year 1,89,550
Weighted average remaining contractual life (in 8.09
years)
Weighted average fair value of options granted Rs.59.04

The details of Series II have been summarized below:

As at March 31,2010
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the year 516,500 Rs.35.00
Add: Granted during the year - -
Less: Forfeited during the year - -
Less: Exercised during the year 265,200 Rs.35.00
Less: Expired during the year
Outstanding at the end of the year 251,300 Rs.35.00
Exercisable at the end of the year 24,900
Weighted average remaining contractual life (in 8.49
years)
Weighted average fair value of options granted Rs.91.75

The details of Series III have been summarized below:

As at March 31,2010
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the year 7,63,600 Rs.35.00
Add: Granted during the year - -
Less: Forfeited during the year - -
Less: Exercised during the year 4,02,200 Rs.35.00
Less: Expired during the year 3,500
Outstanding at the end of the year 3,57,900 Rs.35.00
Exercisable at the end of the year 38,300
Weighted average remaining contractual life (in 9.01
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years)
Weighted average fair value of options granted Rs.74.85

The details of Series IV have been summarized below:

As at March 31,2010
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the year 106,000 Rs.35.00
Add: Granted during the year - -
Less: Forfeited during the year - -
Less: Exercised during the year 31,800 Rs.35.00
Less: Expired during the year -
Outstanding at the end of the year 74,200 Rs.35.00
Exercisable at the end of the year -
Weighted average remaining contractual life (in 9.88
years)
Weighted average fair value of options granted 136.40

The details of Series V have been summarized below:

As at March 31,2010
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the year 77,000 Rs.35.00
Add: Granted during the year - -
Less: Forfeited during the year - -
Less: Exercised during the year 7,700 Rs.35.00
Less: Expired during the year - -
Outstanding at the end of the year 69,300 Rs.35.00
Exercisable at the end of the year - -
Weighted average remaining contractual life (in 10.78
years)
Weighted average fair value of options granted 253.90

The details of Series VI have been summarized below:

As at March 31,2010
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the year -
Add: Granted during the year 50,000 Rs.35.00
Less: Forfeited during the year - -
Less: Exercised during the year - -
Less: Expired during the year - -
Outstanding at the end of the year 50,000 Rs.35.00
Exercisable at the end of the year - -
Weighted average remaining contractual life (in 11.61
years)
Weighted average fair value of options granted 201.45

The weighted average share price for the period over which stock options were exercised was Rs.358.00.

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 The details of exercise price for stock options outstanding at the end of the year are:
March 31, 2010

Series Range of Number of Weighted average Weighted

exercise prices options remaining contractual life average exercise
outstanding of options (in years) price
Series I Rs.35/- 189,550 8.09 Rs.35/-
Series II Rs.35/- 251,300 8.49 Rs.35/-
Series III Rs.35/- 357,900 9.01 Rs.35/-
Series IV Rs.35/- 74,200 9.88 Rs.35/-
Series V Rs.35/- 69,300 10.78 Rs.35/-
Series VI Rs.35/- 50,000 11.61 Rs.35/-

Stock Options granted

Series I:

The weighted average fair value of stock options granted was Rs.59.04. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 38.44 38.44 38.44 38.44
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 5.98 6.33 6.54 6.73
Expected dividend rate (%) 2.31 2.31 2.31 2.31

Series II :

The weighted average fair value of stock options granted was Rs.91.75. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 19.89 19.89 19.89 19.89
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.64 6.83 6.93 7.26
Expected dividend rate (%) 2.52 2.52 2.52 2.52

F-257
Series III :

The weighted average fair value of stock options granted was Rs.74.85. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 31.85 31.85 31.85 31.85
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.96 7.10 7.26 7.40
Expected dividend rate (%) 2.52 2.52 2.52 2.52

Series IV :

The weighted average fair value of stock options granted was Rs. 136.40. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 41.51 41.51 41.51 41.51
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 7.68 7.76 7.82 7.87
Expected dividend rate (%) 0.89 0.89 0.89 0.89

Series V :

The weighted average fair value of stock options granted was Rs. 253.90. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 69.22 69.22 69.22 69.22
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 9.41 9.36 9.34 9.36
Expected dividend rate (%) 1.63 1.63 1.63 1.63

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Series VI :

The weighted average fair value of stock options granted was Rs. 201.45. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 64.80 64.80 64.80 64.80
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) in 1.50 2.50 3.50 4.50
years
Expected dividends per annum (Rs.) 5.00 5.00 5.00 5.00
Average risk-free interest rate (%) 4.03 4.68 5.20 5.64
Expected dividend rate (%) 1.96 1.96 1.96 1.96

The expected volatility was determined based on historical volatility data equal to the NSE volatility rate of
Bank Nifty which is considered as a comparable peer group of the Company. To allow for the effects of early
exercise, it was assumed that the employees will exercise the options within six months from the date of vesting
in view of the exercise price being significantly lower than the market price.
Effect of the employee share-based payment plans on the profit and loss account and on its financial position:
(Rs. in lacs)
As at March 31, 2010
Total compensation cost pertaining to employee share-based payment plan 341.30
(entirely equity settled)
Liability for employee stock options outstanding as at year end 955.97
Deferred compensation cost 198.95

Since the enterprise used the intrinsic value method the impact on the reported net profit and earnings
per share by applying the fair value based method is as follows:

In March 2005, ICAI has issued a guidance note on “Accounting for Employees Share Based Payments”
applicable to employee based share plan the grant date in respect of which falls on or after April 1, 2005. The
said guidance note requires that the proforma disclosures of the impact of the fair value method of accounting
of employee stock compensation accounting in the financial statements. Applying the fair value based method
defined in the said guidance note, the impact on the reported net profit and earnings per share would be as
follows:

Year ended March 31,

2010
Profit as reported (Rs. in lacs) 87,302.56
Add: Employee stock compensation under intrinsic value method (Rs. in lacs) 341.30
340.91
Less: Employee stock compensation under fair value method (Rs. in lacs)
Proforma profit (Rs. in lacs) 87,302.95
Earnings per share
Basic (Rs.)
- As reported 41.08
- Proforma 41.08
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Diluted (Rs.)
- As reported 40.91
- Proforma 40.91
Nominal Value Rs 10.00

During the year, the Company allotted 11,658,552 equity shares of Rs.10/- each at a premium of
14.
Rs.490.80 per share to Qualified Institutional Buyers (QIBs) in terms of Chapter VIII of SEBI
(ICDR) Regulations, 2009. The Company also converted 8,000,000 warrants which were issued by
way of preferential allotment to Shriram Holdings (Madras) Private Limited into equity shares of
Rs.10/- each at a premium of Rs. 290/-per share. The amount received has enhanced the networth
and was utilized for the purpose of business operations.

15. Securitisation/ Direct assignment

The Company sells loans through securitisation and direct assignment. The information on
securitisation / direct assignment activity of the Company as an originator is given below:

Year ended March 31,

2010
Total number of loan assets securitized/directly assigned 380,673
Total book value of loan assets securitized/directly assigned (Rs. in lacs) 875,681.04
Sale consideration received for the securitised assets/directly assigned
9,21,631.22
(Rs. in lacs)
Gain on account of securitization/direct assignment* (Rs. in lacs) 2,62,350.21

* Gain on securitization / direct assignment deals done after February 1, 2006 is amortised over the
period of the loan.

The information on securitisation / direct assignment activity of the Company as an originator as on March
31, 2010 is given in the table below :
(Rs.in lacs)
As at March 31, 2010
Outstanding credit enhancement
-Fixed Deposit 1,73,588.14
Outstanding liquidity facility
-Fixed Deposit 23,833.27
Outstanding subordinate contribution 2,665.30

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 16. Supplementary Statutory Information
(Rs. in lacs)
I Managing Director’s Remuneration Year ended March 31,
2010
Salaries 45.46
Perquisites 7.19
Contribution to Provident fund 0.09
Employee stock option scheme 19.87
72.61

Note: - As the liabilities for gratuity and leave encashment are provided on an actuarial basis for
the Company as a whole, the amounts pertaining to the Managing Director is not included above

The computation of profits under section 349 of the Act has not been given as no commission is
payable to the Directors / Managing Director.

(Rs. in lacs)
II Expenditure in foreign currency (On cash basis)
Year ended March 31,
2010
Travelling 4.23
Others 2.62
6.85

17. Based on the intimation received by the Company, none of the suppliers have confirmed to be
registered under “The Micro, Small and Medium Enterprises Development (‘MSMED’) Act, 2006”.
Accordingly, no disclosures relating to amounts unpaid as at the year ended together with interest paid
/payable are required to be furnished.

18. During the period, the Company sold its entire investment in the wholly owned subsidiary, Shriram
Asset and Equipment Finance Private Limited (SAEFPL), which was incorporated on June 04, 2009.
Further, the Company incorporated wholly owned subsidiaries, Shriram Equipment Finance Company
Limited (SEFCL) and Shriram Automall India Limited (SAIL). Both the companies have not
commenced operations till March 31, 2010.

19. The Company has accounted for its share of reserves and surplus including capital redemption reserve
of the associate company on proportionate basis for the purpose of consolidation.

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20. In addition to the auditors remuneration shown in operating and other expenses, the Company has also
incurred auditors remuneration in connection with other services provided by auditors in connection
with public issue of non convertible debentures and issue expenses of equity shares of Rs. 40.07 lacs
(including out of pocket expenses of Rs. 0.36 lacs) and Rs. 58.96 lacs (including out of pocket
expenses of Rs. 0.51 lacs) respectively and have been amortised as per note 1(q) and shown under
miscellaneous expenditure.

21. Since the company has not given any loans and advances in the nature of loans to its subsidiaries and
associate and the subsidiaries /associates have not acquired any shares of the company, no disclosures
under clause 32 of the Listing Agreeement are required. The receivables on current accounts
consequent to expenditure incurred on behalf of the subsidiaries and the associate are not treated as
loans and advances in the nature of loans.

22. During the year company sold windmills to Nupower Renewables Ltd. for a consideration of Rs.
4,882.92 lacs out of which a sum of Rs. 324.71 lacs have been kept in escrow account pending
completion of certain formalities.

23. This being the first occasion of consolidation, comparative figures for the previous period are not
presented.

F-262
 Notes to Accounts for the period ended on 31st December, 2009
1. Secured Loans

a) (i) Privately placed Redeemable Non-convertible Debentures of Rs.1,000/- each

As at December 31, 2009
Number 19,002,957
Amount Rs in lacs 190,029.57

Secured by equitable mortgage of title deeds of immovable property. Further secured by charge on plant and
machinery, furniture and other fixed assets of the Company, charge on Company’s hypothecation loans,
other loans, advances and other investments of the Company subject to prior charges created or to be created
in favour of the Company’s bankers, financial institutions and others.

Debentures are redeemable at par over a period of 12 months to 160 months from the date of
allotment depending on the terms of the agreement. . The earliest date of redemption is 01.01.2010 .

(ii) Privately Placed Redeemable Non-Convertible Debenture of Rs.1,000,000/- each

Amount (Rs. in lacs)

Date of Allotment/renewal As at December 31, 2009 Redeemable at par on
05.07.2007 5,000.00 05.07.2010
09.07.2007 7,000.00 09.07.2010

11.07.2007 1,000.00 09.07.2010

25.07.2007 12,500.00 25.07.2010

25.07.2007 2,500.00 25.07.2010

10.09.2007 2,500.00 10.09.2010

21.09.2007 2,500.00 21.09.2010

15.10.2007 2,000.00 15.10.2010

18.10.2007 7,000.00 18.10.2010

19.10.2007 5,000.00 19.10.2010

02.05.2008 15,000.00 02.05.2011

20.06.2008 10,000.00 20.06.2011

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 Amount (Rs. in lacs)

Date of Allotment/renewal As at December 31, 2009 Date of Allotment/renewal

18.08.2008 29,000.00 06.03.2010

04.09.2008 3,500.00 04.04.2010

04.09.2008 1,500.00 20.02.2010

04.09.2008 10,000.00 04.09.2010

08.09.2008 3,000.00 08.09.2010

15.09.2008 1,500.00 15.09.2011

15.09.2008 1,500.00 15.09.2010

15.09.2008 2,500.00 15.03.2010

15.09.2008 2,500.00 15.09.2010

15.09.2008 2,500.00 15.03.2010

15.09.2008 1,500.00 30.04.2010

16.09.2008 2,500.00 16.09.2011

17.09.2008 8,000.00 01.09.2011

24.09.2008 2,500.00 24.09.2010

26.09.2008 2,500.00 26.09.2010

26.09.2008 1,500.00 10.09.2010

08.10.2008 1,200.00 06.04.2010

24.10.2008 5,000.00 10.12.2010

03.11.2008 30,000.00 03.11.2013

26.11.2008 1,000.00 26.11.2013

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 24.03.2009 2,400.00 24.03.2010

Amount (Rs. in lacs)

Date of Allotment/renewal As at December 31, 2009 Date of Allotment/renewal

25.03.2009 2,600.00 25.03.2010

5,000.00
28.03.2009 28.03.2012

*13.04.2009 10,000.00 13.04.2011

**20.04.2009 10,000.00 20.04.2011

***20.04.2009 2,500.00 20.04.2011

08.06.2009 7,500.00 08.12.2010
17.06.2009 2,500.00 17.06.2011

30.06.2009 25,000.00 30.06.2011

14.09.2009 1,500.00 05.04.2011

12.10.2009 9,000.00 12.04.2011
TOTAL 263,200.00
Secured by specific assets covered under hypothecation loan agreements by way of exclusive charge and
equitable mortgage of title deeds of immovable property.
*Put/call option on Jan 13, 2010
**Put/call option on March 20, 2010
***Put/call option on Jan 20, 2010
iii) Public issue of Redeemable Non-convertible Debentures of Rs.1,000/- each
Amount (Rs. in
lacs)
As at December 31, Redeemable at par
Date of Allotment/renewal 2009 on Put and Call option
Option -I 4,107.55 26.08.2012 -
Option -I 4,107.55 26.08.2013 -
Option -I 2,053.78 26.08.2014 -
Option -II 3,158.64 26.08.2012 -
Option -II 3,158.64 26.08.2013 -
Option -II 1,579.32 26.08.2014 -
Option -III 26.08.2014 26.08.2013
11,241.88
Option -IV 26.08.2014 26.08.2013
2,274.12
Option -V 26.08.2012 -
68,318.48
Total 99,999.96

F-265
Secured by specific assets covered under hypothecation loan agreements by way of exclusive charge and
equitable mortgage of title deeds of immovable property.

b) Term Loans :
(Rs. in lacs )
As at December 31, 2009

i. From Financial Institutions / Corporates :

Secured by an exclusive charge by way of hypothecation of
specific movable assets being fixed/current assets relating to
40,277.57
hypothecation loans
Total 40,277.57

(Rs. in lacs)

As at December 31, 2009

ii. From Banks :

(a) Secured by hypothecation of vehicles 4.01
(b) Secured by an exclusive charge by way of
hypothecation of specific movable assets being 971,309.19
fixed / current assets relating to hypothecation
loans*
(c) Secured by an exclusive charge by way of
hypothecation of specific immovable/ movable 1,244.28
assets pertaining to the bio mass plant.
Total 972,557.48

*includes Rs. 51,000.00 lacs the charge in respect of which has since been created.

c) Cash Credit from Banks

(Rs. in lacs)
As at December31, 2009
Cash Credit from Banks *348,910.53
Secured by hypothecation of specific assets covered under hypothecation loan agreements.
*includes Rs. 20,000 Lacs the charge in respect of which has since been created.

2. Subordinated Debt

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 The Company has raised Tier II capital by issue of subordinated debt bonds amounting to Rs.
37,898.14 lacs with coupon rate of 9.5% to 13% per annum which are redeemable over a period
of 62 months to 120 months.

3. Final dividend (including tax on dividend) includes an amount of Rs. 380.45 lacs in respect of dividend
paid by the Company for the year ended March 31, 2009 on 81,29,550 equity shares as these have been
allotted before the record date for declaration of dividend for the year ended March 31, 2009, and they
rank pari-passu with the existing equity shares for dividend.

4. Gratuity and other post-employment benefit plans:

The Company has an unfunded defined benefit gratuity plan. Every employee who has completed five years
or more of service is eligible for a gratuity on separation at 15 days salary (last drawn salary) for each
completed year of service.

Consequent to the adoption of revised AS 15 ‘Employee Benefits’ issued under Companies Accounting
Standard Rules, 2006, as amended, the following disclosures have been made as required by the standard:

Profit and Loss account

Net employee benefit expense (recognized in employee cost) (Rs. in lacs)
Gratuity
For the period April 01, 2009
Particulars
to December 31, 2009
Current service cost 107.72
Interest cost on benefit obligation 33.00
Expected return on plan assets NA

Net actuarial (gain) / loss recognised in the period (13.35)

Past service cost Nil

Net benefit expense 127.37

Balance sheet
Details of Provision for gratuity (Rs. in lacs)
Gratuity
Particulars December 31, 2009
Defined benefit obligation 583.83
Fair value of plan assets NA
583.83
Less: Unrecognised past service cost Nil

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 Plan asset / (liability) (583.83)

Changes in the present value of the defined benefit obligation are as follows:
(Rs. in lacs)
Gratuity
Particulars December 31, 2009
Opening defined benefit obligation 463.92
Interest cost 33.00
Current service cost 107.72
Benefits paid (7.46)
Actuarial (gains) / losses on obligation (13.35)
583.83
Closing defined benefit obligation

The Company would not contribute any amount to gratuity in 2009-10 as the scheme is unfunded.
The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
Gratuity
Particulars December 31, 2009
%
Investments with insurer NA
The principal assumptions used in determining gratuity obligations for the Company’s plan are shown below:
Gratuity
Particulars December 31, 2009
Discount Rate 7.5%
Increase in compensation cost 5%
Employee Turnover* 5% and 10%

The estimates of future salary increases, considered in actuarial valuation, are on account of inflation,
seniority, promotion and other relevant factors, such as supply and demand in the employment market.
*5% in case of employees with service period of more than 5 years and 10% for all other employees.
Amounts for the current period are as follows:
(Rs. in lacs)
Particulars December 31, 2009
Defined benefit obligation 583.80
Plan assets NA
Surplus / (deficit) (583.80)
(27.95)
Experience adjustments on plan liabilities

F-268
Experience adjustments on plan assets NA

F-269
5. The Company is a primarily engaged in financing activities. It operates in a single business and geographical segment. The Company also owns
windmills and biomass which generate income from sale of electricity and the same has been classified as ‘Unallocated reconciling item’ as per
requirements of AS – 17 on ‘Segment Reporting’.

(Rs in lacs)
For the Period ended December 31, 2009
Particulars
Financing Activities Unallocated reconciling items Total
Segment Revenue
326,624.43 418.49 327,042.92
Segment Results (Profit before tax and
after interest on Financing Segment)
91,279.65 198.96 91,478.61
Less: Interest on unallocated reconciling
items NA 287.14 287.14
Net profit before tax 91,279.65 (88.18) 91,191.47
Less: Income taxes NA NA 30,325.59
Net profit after tax NA NA 60,865.88
Other Information:
Segment assets 2,855,551.82 1,322.44 2,856,874.26
Unallocated corporate assets 5,779.68
Total Assets 2,855,551.82 1,322.44 2,862,653.94
Segment liabilities 2,555,238.44 1,269.95 2,556,508.39
Unallocated corporate liabilities 7.67
Total Liabilities 2,555,238.44 1,269.95 2,556,516.06
Capital expenditure 544.02 0.00 544.02
Depreciation 1,007.26 188.96 1,196.22
Other non - cash expenses 38,000.60 0.94 38,001.54

6. Related Party Disclosures

Related party where control exists

Other Related Parties

Enterprises having significant influence Shriram Holdings (Madras) Private Limited

over the Company : Shriram Capital Limited
Newbridge India Investments II Limited

Associates : Shriram Asset Management Company Limited (Ownership

Interest: 40%)

Key Managerial Personnel : R Sridhar, Managing Director

Relatives of Key Managerial Personnel : Mrs. Padmapriya Sridhar (spouse)

F-270
 (Rs. in lacs)
Enterprises having
Relatives of Key
significant Key Management
Associates Management Total
influence over the Personnel
Personnel
Company
For period April 01, 2009 to December 31, 2009
Payments/Expenses
Employee benefits for key
- - 41.36 - 41.36
management personnel
Royalty 901.81* - - - 901.81
Data Sourcing fees 20.89* - - - 20.89
Service Charges 125.34* - - - 125.34
Equity dividend 5,602.29# - 5.58 2.43 5,610.30
Interest on subordinate debt - 40.27 - - 40.27
Interest on Inter Corporate Deposit 96.66 - - - 96.66
Interest on NCD - - 0.26 - 0.26
Rent paid 44.67* - - - 44.67
Inter Corporate Deposits 4,200.00 - - - 4,200.00
Receipts/Income
Non Convertible Debenture - 26.00 1.00 27.00
On conversion of warrants 2,400.00 - - - 2,400.00
Rent & electricity reimbursed - 4.05 - - 4.05
Balance outstanding at the period ended on December 31, 2009
Share capital 9,337.15# - 11.02 4.05 9,352.22
Investments in shares - 240.00 - - 240.00
Outstanding expenses 170.40* - - - 170.40
Rent Deposit given 49.00* - - - 49.00
Subordinated debts - 413.40 - - 413.40
Interest payable on subordinate debt - 77.10 - - 77.10
.

F-271
* Denotes transactions with Shriram Capital Limited
# Denotes transactions with Shriram Holdings (Madras) Private Limited

7. Leases
In case of assets given on lease
The Company has given land and building on operating lease for period ranging 11 months
to 60 months. During the period, the company had also given its biomass plant on operating
lease for the period 1st April, 2009 to 30th September, 2009. The same was sold on October 1,
2009, hence gross carrying cost of and accumulated depreciation of the asset as on the date
of balance sheet is nil.

In case of assets taken on lease

The Company has taken various office premises, furniture and fixtures, computers and plant
and machinery under operating lease. The lease payments recognized in the profit & loss
account are Rs.2,598.20 lacs. Certain agreements provide for cancellation by either party and
certain agreements contains clause for escalation and renewal of agreements. . The non-
cancellable operating lease agreements are ranging for a period 22 to 120 months. There are
no restrictions imposed by lease arrangements. There are no sub leases.
The future minimum lease payments in respect of non-cancellable operating lease as at the
balance sheet date are summarized below :
(Rs. in lacs)
As at December 31, 2009

Minimum Lease Payments:

Not later than one year 1,040.25
Later than one year but not later than five years 406.05
Later than five years 59.98

8. In accordance with the Reserve Bank of India circular no.RBI/2006-07/ 225 DNBS (PD) C.C No.
87/03.02.004/2006-07 dated January 4, 2007, the Company has created a floating charge on the
statutory liquid assets comprising of investment in Government Securities to the extent of
Rs.3,053.81 lacs in favour of trustees representing the public deposit holders of the Company.

9. Earnings per share

Particulars For the period April 01, 2009 to

December 31, 2009
Net Profit after tax, Minority interest and Share of Loss of Associate
60,859.86
as per profit and loss account (Rs. in lacs) (A)
Weighted average number of equity shares for calculating Basic EPS
2,097.17
(in lacs) (B)
Weighted average number of equity shares for calculating Diluted
2,115.97
EPS (in lacs) (C)
Basic earnings per equity share (in Rupees) (Face value of Rs. 10/-
29.02
per share) (A) / (B)
Diluted earnings per equity share (in Rupees) (Face value of Rs. 10/-
28.76
per share) (A) / (C)
F-272
Particulars For the period April 01, 2009 to
December 31, 2009
Weighted average number of equity shares for calculating EPS (in
2,097.17
lacs)
Add : Equity shares arising on conversion of optionally convertible
0.00
warrants (in lacs)
Add : Equity shares for no consideration arising on grant of stock 18.80
options under ESOP (in lacs)
Weighted average number of equity shares in calculation diluted EPS
(in lacs) 2,115.97

10.
Deferred Tax Liabilities/(Asset)(Net)
(Rs.in lacs)
The break up of deferred tax asset / liabilities is as under:-
As at December 31, 2009

Deferred Tax Liabilities

Timing difference on account of :
Differences in depreciation in block of fixed assets as per
Nil
tax books and financial books
Debenture Issue Expenses 1,204.34
Gross Deferred Tax Liabilities (A) 1,204.34
Deferred Tax Asset
Timing difference on account of :
Differences in depreciation in block of fixed assets as per
220.31
tax books and financial books
Expenses disallowed under Income Tax Act, 1961 3,237.53
Provision for securitization 3,151.00
Gross Deferred Tax Assets (B) 6,608.84

Deferred Tax Liabilities /(Assets)(Net) (A-B) (5,404.50)

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 (Rs.in lacs)
As at December 31, 2009
11. Contingent Liabilities not provided for

a. Disputed income tax/interest tax demand contested in 164.76

appeals not provided for
[Against the above, a sum of Rs. 29.66 lacs has been paid
under protest]
b. Demands in respect of Service tax 312.00
[Amount of Rs.15.00 lacs has been paid under protest ]

c. Income Tax penalty u/s 271(1)(c ) 349.86

d. Guarantees issued by the Company 700.00

12. Recovery of service tax on lease and hire purchase transactions is kept in abeyance in view of the
stay granted by Honourable Madras High Court. If any liability arises it will be recovered from the
concerned parties. However, on contracts that are terminated, pending decision from the
Honourable Madras High Court, equivalent service tax is written off. The company has recognized
the deferred tax asset on the amounts so written off, as in either case service tax liability will be
paid off or reversed as income.

13. Employee Stock Option Plan

Series I Series II Series III Series IV Series V Series VI
Date of grant October April 1, October 9, August 17, July May 13, 2009
31, 2005 2006 2006 2007 15,2008
Date of May 13, 2009
October February September August 17, July
Board/committee
19, 2005 22, 2006 6, 2006 2007 15,2008
Approval
Date of October 13, 2005
October October October October 13, October
Shareholder’s
13, 2005 13, 2005 13, 2005 2005 13, 2005
approval
Number of 109,000
2,962,500 832,500 910,000 77,000 50,000
options granted
Method of
Equity
Settlement Equity Equity Equity Equity Equity
(Cash/Equity)
Graded Vesting Period
After 1 year of 10% of 10% of 10% of 10% of 10% of 10% of options
grant date options options options options options granted
granted granted granted granted granted
After 2 years of 20% of 20% of 20% of 20% of 20% of 20% of options
grant date options options options options options granted
granted granted granted granted granted
After 3 years of 30% of 30% of 30% of 30% of 30% of 30% of options
grant date options options options options options granted
granted granted granted granted granted
After 4 years of 40% of 40% of 40% of 40% of 40% of 40% of options
grant date options options options options options granted

F-274
 granted granted granted granted granted
Exercisable 10 years 10 years 10 years 10 years 10 years 10 years from
period from from from from from vesting date
vesting vesting vesting vesting vesting
date date date date date
Vesting On achievement of predetermined targets.
Conditions

The details of Series I have been summarized below:

As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period 1,839,800 Rs. 35.00
Add: Granted during the period - -
Less: Forfeited during the period - -
Less: Exercised during the period 797,850 Rs.35.00
Less: Expired during the period 3,500 -
Outstanding at the end of the period 1,038,450 Rs.35.00
Exercisable at the end of the period 130,215
Weighted average remaining contractual life (in 8.34
years)
Weighted average fair value of options granted Rs.59.04

The details of Series II have been summarized below:

As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period 516,500 Rs.35.00
Add: Granted during the period - -
Less: Forfeited during the period - -
Less: Exercised during the period 265,200 Rs.35.00
Less: Expired during the period
Outstanding at the end of the period 251,300 Rs.35.00
Exercisable at the end of the period 25,250
Weighted average remaining contractual life (in 8.74
years)
Weighted average fair value of options granted Rs.91.75

The details of Series III have been summarized below:

As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period 7,63,600 Rs.35.00
Add: Granted during the period - -
Less: Forfeited during the period - -
Less: Exercised during the period 183,500 Rs.35.00
Less: Expired during the period
Outstanding at the end of the period 580,100 Rs.35.00
Exercisable at the end of the period 18,000
Weighted average remaining contractual life (in 9.26
years)
Weighted average fair value of options granted Rs.74.85

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The details of Series IV have been summarized below:
As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period 106,000 Rs.35.00
Add: Granted during the period - -
Less: Forfeited during the period - -
Less: Exercised during the period 8,700 Rs.35.00
Less: Expired during the period -
Outstanding at the end of the period 97,300 Rs.35.00
Exercisable at the end of the period 1,900
Weighted average remaining contractual life (in 10.13
years)
Weighted average fair value of options granted 136.40

The details of Series V have been summarized below:

As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period 77,000 Rs.35.00
Add: Granted during the period -
Less: Forfeited during the period -
Less: Exercised during the period 7,700 Rs.35.00
Less: Expired during the period -
Outstanding at the end of the period 69,300 Rs.35.00
Exercisable at the end of the period -
Weighted average remaining contractual life (in 11.03
years)
Weighted average fair value of options granted 253.90

The details of Series VI have been summarized below:

As at December 31,2009
Number of Shares Weighted Average
Exercise Price(Rs.)
Outstanding at the beginning of the period -
Add: Granted during the period 50,000 Rs.35.00
Less: Forfeited during the period -
Less: Exercised during the period -
Less: Expired during the period -
Outstanding at the end of the period 50,000 Rs.35.00
Exercisable at the end of the period -
Weighted average remaining contractual life (in 11.85
years)
Weighted average fair value of options granted 201.45

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 The weighted average share price for the period over which stock options were exercised was Rs. 318.67

The details of exercise price for stock options outstanding at the end of the period are:
December 31, 2009

Series Range of Number of Weighted average Weighted average

exercise prices options remaining exercise price
outstanding contractual life of
options (in years)
Series I Rs.35/- 1,043,750 8.34 Rs.35/-
Series II Rs.35/- 251,300 8.74 Rs.35/-
Series III Rs.35/- 580,100 9.26 Rs.35/-
Series IV Rs.35/- 92,000 10.13 Rs.35/-
Series V Rs.35/- 69,300 11.03 Rs.35/-
Series VI Rs.35/- 50,000 11.85 Rs.35/-

Stock Options granted

Series I:

The weighted average fair value of stock options granted was Rs.59.04. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 38.44 38.44 38.44 38.44
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 5.98 6.33 6.54 6.73
Expected dividend rate (%) 2.31 2.31 2.31 2.31

Series II :

The weighted average fair value of stock options granted was Rs.91.75. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 19.89 19.89 19.89 19.89
Historical Volatility NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.64 6.83 6.93 7.26
Expected dividend rate (%) 2.52 2.52 2.52 2.52

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Series III :

The weighted average fair value of stock options granted was Rs.74.85. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 31.85 31.85 31.85 31.85
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 6.96 7.10 7.26 7.40
Expected dividend rate (%) 2.52 2.52 2.52 2.52

Series IV :

The weighted average fair value of stock options granted was Rs. 136.40. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 41.51 41.51 41.51 41.51
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 7.68 7.76 7.82 7.87
Expected dividend rate (%) 0.89 0.89 0.89 0.89

Series V :

The weighted average fair value of stock options granted was Rs. 253.90. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 69.22 69.22 69.22 69.22
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 3.00 3.00 3.00 3.00
Average risk-free interest rate (%) 9.41 9.36 9.34 9.36
Expected dividend rate (%) 1.63 1.63 1.63 1.63

F-278
Series VI :

The weighted average fair value of stock options granted was Rs. 201.45. The Black Scholes model has been
used for computing the weighted average fair value of options considering the following inputs:

Yr 1 Yr 2 Yr 3 Yr 4
Exercise Price (Rs.) 35.00 35.00 35.00 35.00
Expected Volatility (%) 64.80 64.80 64.80 64.80
Historical Volatility (%) NA NA NA NA
Life of the options granted (Vesting and exercise period) 1.50 2.50 3.50 4.50
in years
Expected dividends per annum (Rs.) 5.00 5.00 5.00 5.00
Average risk-free interest rate (%) 4.03 4.68 5.20 5.64
Expected dividend rate (%) 1.96 1.96 1.96 1.96
The expected volatility was determined based on historical volatility data equal to the NSE volatility rate of
Bank Nifty which is considered as a comparable peer group of the Company. To allow for the effects of
early exercise, it was assumed that the employees will exercise the options within six months from the date of
vesting in view of the exercise price being significantly lower than the market price.
Effect of the employee share-based payment plans on the profit and loss account and on its financial position:
(Rs. in lacs)
As at December 30,
2009
Total compensation cost pertaining to employee share-based payment plan 292.00
(entirely equity settled)
Liability for employee stock options outstanding as at year end 1,754.33
Deferred compensation cost 256.40
Since the enterprise used the intrinsic value method the impact on the reported net profit and earnings
per share by applying the fair value based method is as follows:

In March 2005, ICAI has issued a guidance note on “Accounting for Employees Share Based Payments”
applicable to employee based share plan the grant date in respect of which falls on or after April 1, 2005. The
said guidance note requires that the proforma disclosures of the impact of the fair value method of accounting
of employee stock compensation accounting in the financial statements. Applying the fair value based
method defined in the said guidance note, the impact on the reported net profit and earnings per share would
be as follows:

For the period April 01, 2009 to

December 31, 2009
Profit as reported (Rs. in lacs) 60,859.86
Add: Employee stock compensation under intrinsic value method (Rs.
292.00
in lacs)
Less: Employee stock compensation under fair value method (Rs. in
294.65
lacs)
Proforma profit (Rs. in lacs) 60,857.21
Earnings per share
Basic (Rs.)
- As reported 29.02
- Proforma 29.02
Diluted (Rs.)
- As reported 28.76

F-279
- Proforma 28.76
Nominal Value Rs 10.00

14. The Company has converted 8,000,000 warrants issued to Shriram Holdings (Madras) Private
Limited into equity shares at a premium of Rs. 290/- during the period.

15. Securitisation / Direct assignment

The Company sells loans through securitisation and direct assignment. The information on securitisation /
direct assignment activity of the Company as an originator is given below:

For the period April 01, 2009 to

December 31, 2009
Total number of loan assets securitized/directly assigned 1,40,532
Total book value of loan assets securitized/directly assigned (Rs.
3,26,229.88
in lacs)
Sale consideration received for the securitized/directly assigned
3,72,295.43
assets (Rs. in lacs)
Gain on account of securitization/direct assignment* (Rs. in lacs) 79,562.73

* Gain on securitisation / direct assignment deals done after February 1, 2006 is amortised over the
period of the loan.

The information on securitisation / direct assignment activity of the Company as an originator as on

December 31, 2009 is given in the table below :
(Rs.in lacs)
As at December 31, 2009
Outstanding credit enhancement
-Fixed Deposit 152,736.05
Outstanding liquidity facility
-Fixed Deposit 25,976.51
Outstanding subordinate contribution 3,145.49
16. Supplementary Statutory Information

(Rs. in lacs)
I Managing Director’s Remuneration
For the period April 01, 2009 to
December 31, 2009
Salaries 21.16
Perquisites 4.70
Contribution to Provident fund 0.07
Employee stock option scheme 15.43
41.36
Note: - As the liabilities for gratuity and leave encashment are provided on an actuarial basis for the
Company as a whole, the amounts pertaining to the Managing Director is not included above
The computation of profits under section 349 of the Act has not been given as no commission is
payable to the Directors / Managing Director.

F-280
 (Rs. in lacs)
II Expenditure in foreign currency (On cash basis)
For the period April 01, 2009 to
December 31, 2009
Travelling 2.95
Others 2.62
5.57

17. Based on the intimation received by the Company, none of the suppliers have confirmed to be
registered under “The Micro, Small and Medium Enterprises Development (‘MSMED’) Act,
2006”. Accordingly, no disclosures relating to amounts unpaid as at the Nine months ended
together with interest paid /payable are required to be furnished.
18. During the period, the Company sold its entire investment in the wholly owned subsidiary, Shriram
Asset and Equipment Finance Private Limited (SAEFPL), which was incorporated on June 22,
2009. Further, the Company incorporated as a wholly owned subsidiary, Shriram Equipment
Finance Company Limited (SEFCL). SEFCL has still not commenced its operation.
19. The Company has accounted for its share of reserves and surplus including capital redemption
reserve of the associate company on proportionate basis for the purpose of consolidation.
20. This being the first occasion of consolidation, comparative figures for the previous period are not
presented.

As per our report of even date

For S.R.BATLIBOI & Co. For G. D. Apte & Co. For and on behalf of the Board of Directors of
Firm Registration No.301003E Firm Registration No.100515W Shriram Transport Finance Company Limited
Chartered Accountants Chartered Accountants

per Shrawan Jalan U. S. Abhyankar R Sridhar S. Venkatakrishnan

Partner Partner Managing Director Director
Membership No. 102102 Membership No.113053

Mumbai K. Prakash
Vice President (Corporate Affairs) &
Company Secretary

F-281
 DISCLOSURES ON EXISTING FINANCIAL INDEBTEDNESS

A. Details of Secured Borrowings:

Our Company’s secured borrowings as on March 31, 2010 amount to Rs. 1,517,248.07 lacs. The details of the individual
borrowings are set out below:
(Rs. In lacs)
TERM LOANS FROM BANKS

Particulars Date of disbursement Amount outstanding Maturity date

as on March 31, 2010

Allahabad Bank 26-Sep-07 1499.90 26-Sep-12

Andhra Bank 16-Mar-09 7500.00 16-Mar-13

AXIS Bank 24-Mar-09 16666.67 24-Sep-10

State Bank Of Bikaner & Jaipur 8-Nov-07 1256.00 8-Nov-10

Calyon Bank 16-Nov-07 5000.00 15-Nov-10

Calyon Bank 24-Mar-08 2000.00 24-Mar-11

Calyon Bank 28-Apr-08 3000.00 27-Apr-11

Canara Bank 31-Mar-09 18750.00 31-Mar-13

Canara Bank 17-Oct-08 13750.00 17-Oct-12

Canara Bank 5-Nov-08 13750.00 5-Nov-12

Corporation Bank 26-Mar-09 1875.00 26-Mar-13

DBS Bank 5-Mar-09 2650.00 5-Sep-10

DBS Bank 27-Sep-07 7500.00 27-Sep-10

Dena Bank 23-Sep-08 10000.00 23-Sep-11

Deutsche Bank 30-May-08 10000.00 30-May-11

Deutsche Bank 30-May-08 10000.00 30-May-10

HDFC Bank 25-Jul-08 5357.14 25-Jul-12

HSBC Bank 25-Mar-09 9250.00 26-Apr-10

ICICI Car Loan 10-Feb-06 1.87 10-Feb-11

ICICI Car Loan 5-Jun-06 1.32 5-May-11

ICICI Bank 28-Apr-08 10416.67 27-Apr-11

- 143 -
 TERM LOANS FROM BANKS

Particulars Date of disbursement Amount outstanding Maturity date

as on March 31, 2010

IDBI Bank 24-Mar-09 10714.29 24-Sep-12

IDBI Bank 3-Mar-08 2678.83 1-Jul-11

IDBI Bank 24-Oct-08 3214.29 1-Jul-12

IDBI Bank 10-Dec-08 6428.57 1-Jul-12

Indian Bank 28-Sep-07 525.59 28-Jun-10

Indian Bank 5-Mar-09 6363.64 5-Dec-11

Indian Bank 25-Mar-08 1515.84 25-Dec-10

ING Vysya Bank 31-Dec-07 1625.00 31-Dec-10

ING Vysya Bank 2-Dec-08 2041.67 28-Dec-11

Oriental Bank Of Commerce 28-Feb-08 10160.69 28-Feb-12

Oriental Bank Of Commerce 22-Nov-07 2397.51 30-Nov-10

Punjab & Sind Bank 16-Apr-08 5000.00 15-Apr-11

Punjab National Bank 15-Oct-08 10285.69 15-Sep-11

Ratnakar Bank 20-Dec-07 1093.60 20-Dec-11

State Bank Of Mysore 29-Sep-06 315.86 28-Sep-10

State Bank Of Mysore 22-Jun-07 2905.54 22-Jun-11

Society General Bank 29-Oct-07 1240.00 20-Nov-10

Society General Bank 14-Mar-08 331.88 20-Dec-10

South Indian Bank 18-Aug-08 3125.00 18-Aug-12

South Indian Bank 20-Mar-09 1875.00 20-Mar-13

Standard Charterd Bank 4-Mar-09 4002.00 4-Mar-11

Standard Charterd Bank 6-May-08 1040.00 6-May-10

State Bank Of Bikaner & Jaipur 31-Mar-09 2500.00 31-Mar-13

State Bank Of Hyderabad 21-Jan-08 7499.40 21-Jan-12

State Bank Of Mauritius 19-Jan-09 1500.00 19-Jan-12

- 144 -
 TERM LOANS FROM BANKS

Particulars Date of disbursement Amount outstanding Maturity date

as on March 31, 2010

State Bank Of Mysore 5-Mar-09 7499.97 5-Mar-13

State Bank Of Mysore 26-Nov-07 4175.58 26-Nov-11

State Bank Of Mysore 19-Sep-08 9370.86 1-Oct-12

State Bank Of Patiala 30-Jul-08 14280.00 30-Jul-12

State Bank Of Travancore 28-Jun-07 416.69 28-Jun-10

State Bank Of Travancore 29-Jan-09 5000.00 29-Jan-12

United Bank Of India 31-Dec-08 7500.00 1-Jan-13

United Bank Of India 3-Jun-08 2812.50 1-Jun-12

United Bank Of India 13-Mar-09 11250.00 1-Apr-13

AXIS Bank 18-Feb-08 10000.00 17-Feb-11

AXIS Bank 20-Oct-08 20000.00 19-Oct-10

Vijaya Bank 28-Sep-06 625.00 28-Sep-10

Vijaya Bank 28-Feb-08 2500.00 28-Feb-12

HSBC Bank 18-Sep-09 4850.00 16-Sep-11

Deutsche Bank 22-Sep-09 7500.00 22-Sep-11

DBS Bank 23-Sep-09 4830.00 23-Sep-11

IDBI Bank 29-Sep-09 19523.81 1-Sep-13

UCO Bank 25-Sep-09 13125.00 25-Sep-13

United Bank 25-Sep-09 8750.00 25-Sep-13

Syndicate Bank 29-Sep-09 13125.00 29-Sep-13

State Bank Of Patiala 29-Sep-09 20000.00 29-Sep-13

State Bank Of Travancore 29-Sep-09 8610.00 29-Sep-12

Barclays Bank 29-Sep-09 3400.00 29-Sep-10

Laxmi Vilas Bank 12-Sep-09 4500.00 12-Sep-10

State Bank Of Bikaner & Jaipur 9-Apr-09 3121.25 31-Mar-13

- 145 -
 TERM LOANS FROM BANKS

Particulars Date of disbursement Amount outstanding Maturity date

as on March 31, 2010

CITI Bank 7-May-09 10000.00 7-May-10

HSBC Bank 29-May-09 4770.00 31-May-11

DBS Bank 22-Jun-09 5000.00 22-Jun-11

Tamilnad Merchantile Bank 22-Jun-09 4062.50 22-Jun-13

CITI Bank 23-Jun-09 5000.00 23-Jun-10

Canara Bank 26-Jun-09 20312.50 26-Jun-13

Central Bank Of India 30-Jun-09 16250.00 30-Jun-13

Indian Bank 30-Jun-09 7273.00 30-Mar-12

Bank Of Rajasthan 30-Jun-09 1875.00 30-Jun-12

Punjab National Bank 27-Jul-09 15294.00 27-May-12

Dena Bank 31-Jul-09 17500.00 31-Jul-13

Karur Vysya Bank 31-Jul-09 1750.00 31-Jul-13

Barclays Bank 3-Aug-09 3000.00 3-Aug-10

HSBC Bank 4-Aug-09 10000.00 4-Aug-10

Society General Bank 14-Aug-09 1416.67 14-Aug-11

CITI Bank 17-Aug-09 10000.00 17-Aug-10

Oriental Bank Of Commerce 24-Aug-09 16111.11 24-Aug-12

HDFC Bank 3-Oct-09 10000.00 3-Oct-13

Barclays Bank 30-Oct-09 4500.00 30-Oct-10

ING Vysya Bank 30-Oct-09 3272.22 30-Oct-12

HSBC Bank 23-Oct-09 7387.83 21-Oct-11

State Bank Of Hyderabad 5-Nov-09 23437.50 5-Nov-13

China Trust Commercial Bank 18-Nov-09 1500.00 18-Nov-11

Punjab & Sind Bank 19-Nov-09 4722.22 19-Feb-13

Canara Bank 25-Nov-09 46875.00 25-Nov-13

- 146 -
 TERM LOANS FROM BANKS

Particulars Date of disbursement Amount outstanding Maturity date

as on March 31, 2010

Andhra Bank 30-Nov-09 18750.00 30-Nov-13

South Indian Bank 17-Dec-09 4687.50 17-Dec-13

Bank Of Tokyo 24-Dec-09 11000.00 24-Dec-10

Society General 24-Dec-09 1050.00 24-Dec-11

Union Bank Of India 31-Dec-09 30000.00 31-Dec-13

Barclays Bank 19-Jan-10 4100.00 19-Jan-11

Indian Bank 29-Jan-10 19168.00 29-Jan-14

State Bank Of India 28-Jan-10 20000.00 27-Jul-10

Standard Chartered Bank 28-Jan-10 30000.00 28-Jan-13

Calyon Bank 29-Jan-10 10000.00 29-Jan-12

State Bank of Indore(Wcdl) 9-Feb-10 7500.00 10-May-10

State Bank of Patiala(Wcdl) 26-Feb-10 4000.00 27-May-10

Shinhan Bank 9-Feb-10 2800.00 1-Jan-11

Mizuho Bank 5-Mar-10 5000.00 5-Mar-11

Dhanlakshmi Bank 12-Mar-10 5000.00 12-Mar-14

J P Morgan Chase Bank 22-Mar-10 12000.00 6-Apr-11

HSBC Bank 23-Mar-10 10000.00 23-Apr-11

Corporation Bank 25-Mar-10 10000.00 25-Mar-15

Punjab National Bank 26-Mar-10 25000.00 26-Jan-13

Society General Bank 23-Mar-10 1200.00 23-Mar-12

Total 929,935.14

(Rs. In lacs)
TERM LOANS FROM OTHERS

Particulars Date of disbursement Amount outstanding Maturity date

on March 31, 2010

L&T Finance Limited 2-Mar-05 466.08 2-Mar-11

L&T Finance Limited 29-Jun-05 626.97 30-Jun-11

- 147 -
 TERM LOANS FROM OTHERS

Particulars Date of disbursement Amount outstanding Maturity date

on March 31, 2010

L&T Finance Limited 2-Jan-06 860.37 2-Jan-12

Life Insurance Corporation 14-Jun-06 3000.00 31-May-11
Small Industries Development 29-Sep-08 5500.00 10-Sep-11
Bank of India
Small Industries Development 2-Jan-06 335.00 10-Dec-10
Bank of India
Small Industries Development 31-Dec-07 1400.00 10-Dec-10
Bank of India
Total 12,188.42

(Rs. In lacs)
CASH CREDIT FROM BANKS
Particulars Date of disbursement Amount
Outstanding as
on March
31,2010
Abu Dhabi Commercial Bank 3-Feb-09 4.88
Andhra Bank 30-Dec-09 1012.85
Bahrain & Kuwait 22-Jul-08 899.99
Bank Of Baroda 19-Nov-07 3006.12
Bank Of Ceylon 21-Nov-08 0.16
Bank Of India 4-Jun-09 9998.11
Bank Of India Wcdl 28-Aug-09 20000.00
Bank Of Maharashtra 22-Dec-08 3699.36
Bank Of Rajasthan 22-Jun-09 6.58
Central Bank Of India 21-Aug-09 15050.78
City Union Bank 13-Oct-08 1638.92
Corporation Bank 16-Jan-08 972.01
DCB WCDL 22-Jan-10 2000.00
DCB WCDL 30-Jan-10 2000.00
Dena Bank 30-Jan-09 99.06
Federal Bank 19-Sep-07 5.86
ICICI Bank Limited 5-Mar-09 6988.86
IDBI Bank Limited 3-Oct-08 5.01
IDBI Bank Limited 29-Jan-10 56.75
Indian Bank 29-Jan-10 6.49
Indian Overseas Bank 18-Feb-09 5012.22
Karnataka Bank 5-Dec-07 4730.09
Karur Vysya Bank Wcdl 30-Jun-09 1512.11
Punjab National Bank 24-Dec-07 0.06

- 148 -
 CASH CREDIT FROM BANKS
Particulars Date of disbursement Amount
Outstanding as
on March
31,2010
Ratnakar Bank 11-Aug-08 5.43
State Bank Of Bikaner & Jaipur 30-Dec-09 4207.18
State Bank Of Mysore 26-Sep-09 3012.86
State Bank Of Travancore 29-Sep-08 3557.73
Syndicate Bank 5-Mar-10 2520.59
The Lakshmi Vilas Bank 17-Mar-09 3.45
UCO Bank 4-Aug-08 23.14

TOTAL 92,036.65

Our Company has issued secured redeemable non convertible debenture of face value of Rs. 10,00,000 each on a private
placement basis of which Rs. 198,600 Lacs is outstanding as on March 31, 2010 the detail of which are set out below

(Rs. In las)
Description Date of Amount Redemption Date
Allotment Outstanding as
on March
31,2010
UTI - Treasury Advantage Fund 5-Jul-07 5000.00 5-Jul-10

UTI - Treasury Advantage Fund 9-Jul-07 2500.00 9-Jul-10

HDFC Trustee Company Ltd - A/C HDFC Fmp 36M June 9-Jul-07 1590.00 9-Jul-10
2007
UTI - Fmp - Yearly Series Sep 09 9-Jul-07 1500.00 9-Jul-10
Reliance General Insurance Co Ltd 9-Jul-07 500.00 9-Jul-10
HDFC Trustee Company Limited A/C HDFC Fmp 9-Jul-07 500.00 9-Jul-10
17Mnovember 2008 (1)
HDFC Trustee Company Limited A/C HDFC Cash 9-Jul-07 210.00 9-Jul-10
Management Fund Treasury Advantage Plan
HDFC Trustee Company Limited A/C HDFC Fmp 22M 9-Jul-07 200.00 9-Jul-10
September 2008
HDFC Standard Life Insurance Company Limited 11-Jul-07 1000.00 9-Jul-10
The Hongkong And Shanghai Banking Corp.Ltd. 25-Jul-07 2500.00 25-Jul-10
ICICI Prudential Flexible Income Plan 25-Jul-07 10000.00 25-Jul-10
UTI-Unit Linked Insurance Plan 10-Sep-07 1000.00 10-Sep-10
UTI - Ftif Series Vii Plan Ii 10-Sep-07 1350.00 10-Sep-10
UTI - Ccp Advantage Fund 10-Sep-07 150.00 10-Sep-10
KOTAK Mahindra Trustee Co. Ltd. A/C KOTAK 15-Oct-07 2000.00 15-Oct-10
Fmp370 Days Series 1
ICICI Prudential Short Term Plan 19-Oct-07 1500.00 18-Oct-10
UTI - Retirement Benefit Pension Fund 19-Oct-07 1400.00 18-Oct-10
ICICI Prudential Ultra Short Term Fund 19-Oct-07 1000.00 18-Oct-10
UTI-Liquid Cash Plan 19-Oct-07 2500.00 19-Oct-10

- 149 -
Description Date of Amount Redemption Date
Allotment Outstanding as
on March
31,2010
UTI - Treasury Advantage Fund 19-Oct-07 2360.00 19-Oct-10
UTI-Money Market Fund 19-Oct-07 140.00 19-Oct-10
Life Insurance Corporation Of India 2-May-08 15000.00 2-May-11
UTI-Unit Linked Insurance Plan 20-Jun-08 3500.00 20-Jun-11
UTI-Unit Scheme For Charitable And Religious trusts 20-Jun-08 2500.00 20-Jun-11
And Registered Societies
UTI - Childrens Career Balanced Plan 20-Jun-08 2500.00 20-Jun-11
UTI - Retirement Benefit Pension Fund 20-Jun-08 1500.00 20-Jun-11
Reliance Capital Trustee Co Ltd A/C-Reliance money 4-Sep-08 5000.00 4-Sep-10
Manager Fund
HDFC Trustee Company Limited A/C HDFC Cash 4-Sep-08 4300.00 4-Sep-10
Management Fund Treasury Advantage Plan
HDFC Trustee Company Limited A/C HDFC Fmp 22M 4-Sep-08 600.00 4-Sep-10
September 2008
HDFC Trustee Company Ltd-HDFC Floating Rate 4-Sep-08 100.00 4-Sep-10
Income Fund A/C Short Term Plan
Deutsche Trustee Services (India) Pvt Limited A/C Dws 8-Sep-08 2800.00 8-Sep-10
Fixed Term Fund-Series 59
Religare Trustee Company Private Limited - A/C Religare 8-Sep-08 110.00 8-Sep-10
Long Term Fixed Maturity Plan - Series I - Plan A
Religare Trustee Company Private Limited - A/C Religare 8-Sep-08 80.00 8-Sep-10
Ultra Short Term Fund
Religare Trustee Company Private Limited - A/C Religare 8-Sep-08 10.00 8-Sep-10
Short Term Plan
AXIS Bank Limited 16-Sep-08 2500.00 16-Sep-11
KOTAK Mahindra Trustee Company Ltd. A/C KOTAK 15-Sep-08 1070.00 15-Sep-10
flexi Debt Scheme
KOTAK Mahindra Trustee Co. Ltd. A/C KOTAK 15-Sep-08 430.00 15-Sep-10
Fmp19M Series 01
KOTAK Mahindra Trustee Company Ltd. A/C 15-Sep-08 2500.00 15-Sep-10
KOTAKflexi Debt Scheme
AXIS Bank Limited 15-Sep-08 1500.00 15-Sep-11
UTI Ftif Sr - V Plan Ii ( 20 Mts ) 15-Sep-08 1500.00 30-Apr-10
ICICI Prudential Fixed Maturity Plan - Series45 - Three 17-Sep-08 8000.00 1-Sep-11
Years Plan
HDFC Trustee Company Limited A/C HDFC Fmp 22M 24-Sep-08 2500.00 24-Sep-10
September 2008
HDFC Trustee Company Limited A/C High Interest Fund 26-Sep-08 700.00 26-Sep-10
Short Term Plan
HDFC Trustee Company Limited A/C HDFC Fmp 26-Sep-08 600.00 26-Sep-10
17Mnovember 2008 (1)
HDFC Trustee Company Ltd HDFC Mf Monthly Income 26-Sep-08 550.00 26-Sep-10
Plan Short Term Plan
HDFC Trustee Company Limited A/C HDFC Fmp 22M 26-Sep-08 350.00 26-Sep-10
September 2008
HDFC Trustee Company Ltd A/C - HDFC Children'S Gift 26-Sep-08 190.00 26-Sep-10
Fund - Investment Plan
HDFC Trustee Company Limited A/C HDFC Cash 26-Sep-08 110.00 26-Sep-10
Management Fund Treasury Advantage Plan
- 150 -
Description Date of Amount Redemption Date
Allotment Outstanding as
on March
31,2010
UTI - Ftif Sr. V Plan Iii (24 Mts) 26-Sep-08 1300.00 10-Sep-10
UTI-Unit Linked Insurance Plan 26-Sep-08 200.00 10-Sep-10
Sundaram Bnp Paribas Mutual Fund A/C Sundarambnp 8-Oct-08 700.00 6-Apr-10
Paribas Ftp - 18 Months Series L
Sundaram Bnp Paribas Mutual Fund A/C Sundarambnp 8-Oct-08 300.00 6-Apr-10
Paribas Ultra Short Term Fund
ICICI Prudential Fixed Maturity Plan - Series45 - Twenty 8-Oct-08 190.00 6-Apr-10
Months Plan
ICICI Prudential Liquid Plan 8-Oct-08 10.00 6-Apr-10
ICICI Prudential Real Estate Securities Fund 24-Oct-08 4500.00 10-Dec-10
ICICI Prudential Flexible Income Plan 24-Oct-08 500.00 10-Dec-10
Life Insurance Corporation Of India 3-Nov-08 30000.00 3-Nov-13
General Insurance Corporation Of India 26-Nov-08 1000.00 26-Nov-13
United Bank Of India 28-Mar-09 5000.00 28-Mar-12
Templeton India Ultra-Short Bond Fund 13-Apr-09 10000.00 13-Apr-11
Principal Trustee Company Pvt Ltd A/C Principal Mutual 20-Apr-09 2000.00 20-Apr-11
Fund Principal Income Fund Short Term Plan
Principal Trustee Company Pvt Ltd A/C Principal Mutual 20-Apr-09 500.00 20-Apr-11
Fund Principal Income Fund
KOTAK Mahindra Trustee Company Ltd. A/C 17-Jun-09 1800.00 17-Jun-11
KOTAKflexi Debt Scheme
KOTAK Mahindra Trustee Co. Ltd. A/C KOTAK 17-Jun-09 700.00 17-Jun-11
Fmp18M Series 3
Standard Chartered Bank (Mauritius) Limited -Debt 30-Jun-09 25000.00 30-Jun-11
Tata Trustee Company Ltd A/C Tata Mutual Funda/C Tata 14-Sep-09 1500.00 5-Apr-11
Fixed Maturity Plan - Series 25 Scheme A
Morgan Stanley India Capital Private Limited 12-Oct-09 6500.00 12-Apr-11
KOTAK Mahindra Trustee Co. Ltd. A/C KOTAK 12-Oct-09 1400.00 12-Apr-11
Fmp18M Series 2
KOTAK Mahindra Trustee Co Ltd A/C KOTAK Fmp 19 12-Oct-09 1100.00 12-Apr-11
M Series 2
Take Solutions Ltd 24-Mar-10 2400.00 24-Mar-11
Take Solutions Ltd 24-Mar-10 200.00 24-Mar-11
CMNK Consultancy & Services Pvt Ltd 25-Mar-10 2,400.00 25-Mar-11
Total 198,600.00

The Company has issued secured redeemable non convertible debentures of face value of Rs.1,000/- each through public
issue of which Rs. 95,784.73 lacs is outstanding as on March 31, 2010, the details of which are set out below:
(Rs in Lacs)

Outstanding amount as
Description Number of NCDs Redemption Month
at March 31, 2010

Option -I
August 2012 –August 2014
8,808 8,724.87

- 151 -
 Outstanding amount as
Description Number of NCDs Redemption Month
at March 31, 2010

Option -II
August 2012 –August 2014
11,173 7,374.6
Option -III
August 2014
11,333 10,422.51
Option -IV
August 2014
1,861 2,274.12
Option -V
August 2012
3,568 66,988.63
Total 95,784.73

The Company has issued secured redeemable non convertible debentures of face value of Rs.1,000/- each on a private
placement basis of which Rs. 188,703.14 lacs is outstanding as on March 31, 2010, the details of which are set out
below:
(Rs.in Lacs)

Outstanding amount as
Description Number of NCDs Redemption Month
at March 31, 2010

Secured Redeemable Non 406,540 188,703.14 April 2010- November

Convertible Debentures to 2017
Retail debenture holders
Total 406,540 188,703.14

B. Details of Unsecured Borrowings:

(Rs. In lacs)
Particulars Date of Amount Redemption Date
Allotment Outstanding as
on March
31,2010

REDEEMABLE NON-CONVERTIBLE
DEBENTURE
UTI - Fmp - Yearly Series Sep 09 25-Sep-07 2,500.00 25-Sep-10
Total 2,500.00

(Rs. In lacs)
COMMERCIAL PAPER Date of Amount Redemption Date
Allotment Outstanding as
on March
31,2010
UTI-Float ING Rate Fund-Stp 4-Aug-09 1,500.00 3-Aug-10
Religare Trustee Company Private Limited-A/Creligare 4-Aug-09 1,000.00 3-Aug-10
Credit Opportunities Fund

Total 2,500.00

- 152 -
 (Rs. In lacs)
SUBORDINATED DEBTS Date of Amount Redemption Date
Allotment Outstanding as
on March
31,2010
Oriental Bank Of Commerce 30-Nov-07 1,000.00 31-May-13
UTI - Monthly Income Scheme 29-Jan-08 1,500.00 29-Jul-13
UTI-Unit Linked Insurance Plan 29-Jan-08 1,000.00 29-Jul-13
Bank Of India 1-Feb-08 1,500.00 1-May-13
Bank Of India 17-Mar-08 1,500.00 17-Sep-13
LIC MF Liquid Fund 24-Mar-08 5,000.00 24-Jun-13
UCO Bank 27-Mar-08 1,000.00 27-Jun-13
LIC MF Liquid Fund 2-May-08 1,700.00 3-Oct-13
LIC MF Income Plus Fund 2-May-08 800.00 3-Oct-13
Hvpnl Employees Pension Fund Trust 4-Aug-08 2,250.00 4-Aug-18
Food Corporation Of India Cpf Trust 4-Aug-08 1,000.00 4-Aug-18
Hvpnl Employees Provident Fund Trust 4-Aug-08 750.00 4-Aug-18
Gas Authority Of India Limited Employees Provident 4-Aug-08 300.00 4-Aug-18
Fund Trust
The Jammu And Kashmir Bank Employees Provident 4-Aug-08 200.00 4-Aug-18
Fund Trust
Gail Employees Superannuation Benefit Fund 4-Aug-08 100.00 4-Aug-18
Gujarat Alkalies And Chemicals Ltd Employees 4-Aug-08 100.00 4-Aug-18
provident Fund Trust
Gail (India) Limited Employees Death-Cum- 4-Aug-08 50.00 4-Aug-18
Superannuation Gratuity Scheme
Asbestos Cement Limited Staff Provident Fund 4-Aug-08 40.00 4-Aug-18
Provident Fund Of Mangalore Refinery And 4-Aug-08 40.00 4-Aug-18
Petrochemicals Limited
Mother Dairy Employees Provident Fund Trust 4-Aug-08 30.00 4-Aug-18
Gsfc Ltd - Fibre Unit Employees P F Trust 4-Aug-08 30.00 4-Aug-18
Trustees Provident Fund Of The Employees Of The 4-Aug-08 30.00 4-Aug-18
Ugar Sugar Works Ltd
British High Commission India Staff Provident fund 4-Aug-08 20.00 4-Aug-18
Asbestos Cement Limited Employees Provident Fund 4-Aug-08 20.00 4-Aug-18
L And T Niro Staff Provident Fund 4-Aug-08 10.00 4-Aug-18
Alembic Limited Provident Fund Trust 4-Aug-08 10.00 4-Aug-18
Atlas Cycle Industries Provident Fund Trust 4-Aug-08 10.00 4-Aug-18
Lubrizol India Limited Employees Provident Fund 4-Aug-08 10.00 4-Aug-18
Chhattisgarh State Electricity Board (Cseb) Provident 5-Nov-08 2,000.00 5-Nov-18
Fund Trust
Delhi Development Authority 5-Nov-08 1,000.00 5-Nov-18
Chhattisgarh State Electricity Board Gratuity and 7-Nov-08 1,500.00 7-Nov-18
Pension Fund Trust
UCO Bank 26-Nov-08 5,000.00 26-Feb-14
Jacobs H And G Private Limited Employees Provident 26-Nov-08 10.00 26-Feb-14
Fund
Bank Of Maharashtra 11-Dec-08 2,000.00 11-Mar-14
Bank Of Baroda 11-Dec-08 2,000.00 11-Mar-14
The Indian Iron And Steel Co Ltd Provident Instit UTI 11-Dec-08 500.00 11-Mar-14
on
Durgapur Steel Plant Provident Fund 11-Dec-08 200.00 11-Mar-14

- 153 -
 SUBORDINATED DEBTS Date of Amount Redemption Date
Allotment Outstanding as
on March
31,2010
Ashok Leyland Senior ExecUTIves Provident Fund 11-Dec-08 100.00 11-Mar-14
Rameshwara Jute Mills Workers Provident Fund trust 11-Dec-08 100.00 11-Mar-14
Gujarat Alkalies And Chemicals Ltd Employees 11-Dec-08 50.00 11-Mar-14
provident Fund Trust
Shivani Kumar 11-Dec-08 13.00 11-Mar-14
Russell Reynolds Associates India Employees 11-Dec-08 5.00 11-Mar-14
Provident Fund
Frank Ross Ltd Employees' Provident Fund 11-Dec-08 5.00 11-Mar-14
D S Savant And Sons Employees Provident Fund 11-Dec-08 5.00 11-Mar-14
Paushak Ltd Provident Fund 11-Dec-08 5.00 11-Mar-14
Afco Fincon Pvt. Ltd. 11-Dec-08 4.00 11-Mar-14
Rai And Sons Private Limited Employees Provident 11-Dec-08 4.00 11-Mar-14
Fund
Mehta And Padamsey Private Limited Employees 11-Dec-08 2.00 11-Mar-14
provident Fund
Mehta And Padamsey Surveyors Private Limited staff 11-Dec-08 2.00 11-Mar-14
Provident Fund
Hirabai Vithaldas Shubh Trust 11-Dec-08 2.00 11-Mar-14
The Metal Roll ING Works Limited Employees 11-Dec-08 1.00 11-Mar-14
Educational Welfare Trust
Sarvodaya Welfare Trust 11-Dec-08 1.00 11-Mar-14
Hakamchand Vakhatram Philanthropic Trust 11-Dec-08 1.00 11-Mar-14
Bangiya Gramin Vikash Bank 15-Dec-08 300.00 15-Mar-14
Life Insurance Corporation Of India 23-Dec-08 100.00 23-Mar-14
Karnataka Power Corporation Ltd Emp Contributory 23-Dec-08 100.00 23-Mar-14
Provident Fund Trust
Maihar Cement Employees Provident Fund 29-Dec-08 30.00 29-Dec-18
Century Textiles And Industries Ltd. (Cement 29-Dec-08 7.00 29-Dec-18
divisions) Superannuation Fund
Manikgarh Cement Employees Superannuation Welfare 29-Dec-08 4.00 29-Dec-18
Trust
LIC Of India - Gratuity Plus 17-Jan-09 500.00 17-Apr-14
Bank Of India 2-Apr-09 2,000.00 2-Jul-14
Air- India Employees Provident Fund 2-Apr-09 500.00 2-Jul-14
Hero Honda Motors Ltd 18-Apr-09 1,300.00 18-Jul-14
The Indian Iron And Steel Co Ltd Provident Instit UTI 18-Apr-09 500.00 18-Jul-14
on
Durgapur Steel Plant Provident Fund 18-Apr-09 200.00 18-Jul-14
Rkm Provident Fund 18-Apr-09 179.00 18-Jul-14
Rameshwara Jute Mills Workers Provident Fund trust 18-Apr-09 100.00 18-Jul-14
Radha Govind Samiti 18-Apr-09 100.00 18-Jul-14
Megna Jute Mills Provident Fund 18-Apr-09 27.00 18-Jul-14
L And T (Kansbahal) Staff And Workmen Provident 18-Apr-09 15.00 18-Jul-14
Fund
Hakamchand Vakhatram Philanthropic Trust 18-Apr-09 10.00 18-Jul-14
Snehal Baid 18-Apr-09 10.00 18-Jul-14
Bijay Singh Baid 18-Apr-09 10.00 18-Jul-14
Sanjay Kumar Baid 18-Apr-09 10.00 18-Jul-14

- 154 -
 SUBORDINATED DEBTS Date of Amount Redemption Date
Allotment Outstanding as
on March
31,2010
Wander Limited Employees Provident Fund 18-Apr-09 7.00 18-Jul-14
Ramprakash Podar Charitable Trust 18-Apr-09 7.00 18-Jul-14
Orient Ceramics Provident Fund InstitUTIon 18-Apr-09 7.00 18-Jul-14
Burns Philp India Private Limited Employees Provident 18-Apr-09 6.00 18-Jul-14
Fund
L And T (Kansbahal) Officers And Supervisory staff 18-Apr-09 6.00 18-Jul-14
Provident Fund
Eskaps (India) Pvt. Ltd. Employees Providend fund 18-Apr-09 5.00 18-Jul-14
Mehta And Padamsey Private Limited 18-Apr-09 1.00 18-Jul-14
Employeesprovident Fund
ICICI Bank Ltd 15-Jul-09 3,920.00 10-Oct-14
Chhattisgarh State Electricity Board Gratuity and 15-Jul-09 440.00 10-Oct-14
Pension Fund Trust
Abn Amro Bank N V Employees' Provident Fund 15-Jul-09 150.00 10-Oct-14
Aradhana Investments Ltd 15-Jul-09 100.00 10-Oct-14
Cheviot Agro Industries Ltd 15-Jul-09 30.00 10-Oct-14
R S R Mohota Spg And Wvg Mills Ltd 15-Jul-09 20.00 10-Oct-14
Employeesprovident Fund Trust HIN Ganghat
Sunderdevi Baid 15-Jul-09 20.00 10-Oct-14
Bela Anil Dalal 15-Jul-09 15.00 10-Oct-14
Meenakshi Baid 15-Jul-09 15.00 10-Oct-14
Aditya Share Deal INGs And Trading Private Limited 15-Jul-09 15.00 10-Oct-14
Cheviot Company Limited Employees Gratuity Trust 15-Jul-09 10.00 10-Oct-14
Fund
Amrish A Dalal 15-Jul-09 10.00 10-Oct-14
Bijay Singh Baid 15-Jul-09 10.00 10-Oct-14
Ganpati Share Cap Private Limited 15-Jul-09 10.00 10-Oct-14
Mikasa Cosmetics Limited 15-Jul-09 30.00 10-Oct-14
Anil Vipin Dalal Huf 15-Jul-09 10.00 10-Oct-14
Nikhil Anil Dalal 15-Jul-09 15.00 10-Oct-14
Jagdish Rani Basur 15-Jul-09 20.00 10-Oct-14
Balkash Exim Pvt Ltd 15-Jul-09 140.00 10-Oct-14
Desai Amit Sumanlal Huf 15-Jul-09 20.00 10-Oct-14
Central Bank Of India 27-Oct-09 4,500.00 27-Jan-15
Nps Trustees - LIC Pension Fund Scheme 1 27-Oct-09 1,310.00 27-Jan-15
Trustees Hindustan Steel Limited Contributory 27-Oct-09 1,000.00 27-Jan-15
provident Fund, Rourkela
Food Corporation Of India Cpf Trust 27-Oct-09 1,000.00 27-Jan-15
Air- India Employees Provident Fund 27-Oct-09 600.00 27-Jan-15
Allahabad Bank 27-Oct-09 500.00 27-Jan-15
Dombivli Nagari Sahakari Bank Ltd 27-Oct-09 500.00 27-Jan-15
Nps Trust - A/C LIC Pension Fund - Sg Scheme1 27-Oct-09 200.00 27-Jan-15
Gujarat Alkalies And Chemicals Ltd 27-Oct-09 160.00 27-Jan-15
Employeesprovident Fund Trust
Sprism Investment Services P Ltd 27-Oct-09 85.00 27-Jan-15
Sushilkumar N Trivedi 27-Oct-09 50.00 27-Jan-15
Ashok Leyland Employees Hosur Provident Fundtrust 27-Oct-09 30.00 27-Jan-15

- 155 -
 SUBORDINATED DEBTS Date of Amount Redemption Date
Allotment Outstanding as
on March
31,2010
Centre For Development Of Telematics Employees 27-Oct-09 30.00 27-Jan-15
Provident Fund Trust
P Anusha 27-Oct-09 15.00 27-Jan-15
The Municipal Co-Op Bank Empl Prov Fund 27-Oct-09 10.00 27-Jan-15
Humphreys And Glasgow Directors Superannuation 27-Oct-09 3.00 27-Jan-15
Fund
Orient Ceramics Provident Fund InstitUTIon 27-Oct-09 3.00 27-Jan-15
R A Nariman And Co Ltd Employees Provident Fund 27-Oct-09 2.00 27-Jan-15
Trust
A. K. Capital Services Ltd. 27-Oct-09 2.00 27-Jan-15
United India Insurance Company Limited 31-Oct-09 2,000.00 31-Oct-19
Bank Of India Provident Fund 31-Oct-09 500.00 31-Oct-19
Air- India Employees Provident Fund 31-Oct-09 400.00 31-Oct-19
The Kalyan Janata Sahakari Bank Ltd 24-Nov-09 500.00 22-Nov-19
The Zoroastrian Co-Operative Bank Ltd 24-Nov-09 500.00 22-Nov-19
The Jammu And Kashmir Bank Employee Pension 24-Nov-09 400.00 22-Nov-19
Fund Trust
Engineers India Limited Employees Provident Fund 24-Nov-09 300.00 22-Nov-19
The Jammu And Kashmir Bank Employees Provident 24-Nov-09 200.00 22-Nov-19
Fund Trust
Darashaw & Company Pvt Ltd 24-Nov-09 165.00 22-Nov-19
Hooghly Docking Works Provident Fund 24-Nov-09 10.00 22-Nov-19
Intervet India Pvt Ltd Employees Provident Fund Trust 24-Nov-09 10.00 22-Nov-19
A V George Group Employees Provident Fund ( 24-Nov-09 10.00 22-Nov-19
Trustees )
Swan Silk Ltd Employees Provident Fund Trust 24-Nov-09 5.00 22-Nov-19
Allianz Biosciences Pvt Ltd 31-Dec-09 100.00 31-Dec-19
Youth Development Co Op Bank Ltd Kolhapur 31-Dec-09 100.00 31-Dec-19
Trustees Hind Lamps Employees Provident Fund( 31-Dec-09 100.00 31-Dec-19
Exempted Employees )
Caress Beauty Care Products Pvt Ltd 31-Dec-09 50.00 31-Dec-19
Cool Cosmetics Private Limited 31-Dec-09 50.00 31-Dec-19
Ashish Navin Shah 31-Dec-09 20.00 31-Dec-19
Guljit Chaudhri 31-Dec-09 10.00 31-Dec-19
Milan A Shah 31-Dec-09 10.00 31-Dec-19
East Commercial Pvt. Ltd. 31-Dec-09 10.00 31-Dec-19
S Raja 31-Dec-09 5.00 31-Dec-19
Orient Ceramics Provident Fund InstitUTIon 31-Dec-09 4.00 31-Dec-19
Manju Pande 31-Dec-09 10.00 31-Dec-19
Securities Trading Corporation Of India Limited 31-Dec-09 3,950.00 30-Jun-15
Associated Capsules Private Limited 31-Dec-09 100.00 30-Jun-15
All bank Finance Limited 31-Dec-09 100.00 30-Jun-15
Keki Minoo Mistry 31-Dec-09 30.00 30-Jun-15
Mathrubhumi Employees Superannuation Fund 31-Dec-09 10.00 30-Jun-15
Virendra Ratilal Sangharajka 31-Dec-09 5.00 30-Jun-15
Ritu Modani 31-Dec-09 3.00 30-Jun-15
Usha Modani 31-Dec-09 2.00 30-Jun-15

- 156 -
 SUBORDINATED DEBTS Date of Amount Redemption Date
Allotment Outstanding as
on March
31,2010
Anu Khattar 31-Dec-09 1.00 30-Jun-15
Shriram Life Insurance Company Limited 6-Jan-10 300.00 6-Jul-15
Central Bank Of India 18-Jan-10 5,000.00 18-Apr-15
Bank Of Maharashtra 22-Jan-10 1,000.00 22-Apr-15
Food Corporation Of India Cpf Trust 22-Jan-10 200.00 22-Apr-15
A. K. Capital Services Ltd. 22-Jan-10 132.00 22-Apr-15
Gujarat Alkalies And Chemicals Ltd 22-Jan-10 90.00 22-Apr-15
Employeesprovident Fund Trust
Colgate- Palmolive (India) Ltd Provident Fund 22-Jan-10 50.00 22-Apr-15
Ashok Leyland Employees Hosur Provident Fundtrust 22-Jan-10 24.00 22-Apr-15
The Municipal Co-Op Bank Empl Prov Fund 22-Jan-10 4.00 22-Apr-15
Air- India Employees Provident Fund 29-Jan-10 700.00 29-Jan-20
Arvind Sahakari Bank Ltd 29-Jan-10 100.00 29-Jan-20
Loknete Dattaji Patil Sahkari Bank Ltd.,Lasalgaon 29-Jan-10 50.00 29-Jan-20
Sulaimani Co Op. Bank Ltd. 29-Jan-10 40.00 29-Jan-20
B. M. Financial Services ( India ) Private limited 29-Jan-10 5.00 29-Jan-20
Huntsman Advanced Materials ( India ) Pvt Ltd 29-Jan-10 3.00 29-Jan-20
employees Gratuity Fund
Petro Araldite Private Limited Employees Provident 29-Jan-10 2.00 29-Jan-20
Fund
STCI Primary Dealer Limited 29-Jan-10 990.00 29-Jul-15
Bank Of India Provident Fund 29-Jan-10 500.00 29-Jul-15
The Kalyan Janata Sahakari Bank Ltd 29-Jan-10 250.00 29-Jul-15
Model Co Op Bank Ltd 29-Jan-10 200.00 29-Jul-15
The Jain Sahakari Bank Limited 29-Jan-10 70.00 29-Jul-15
Nandlal Pribhdas Tolani 29-Jan-10 50.00 29-Jul-15
Icb Ltd Employees Provident Fund 29-Jan-10 10.00 29-Jul-15
Hema Parameswaran 29-Jan-10 2.00 29-Jul-15
Vijaya R K 29-Jan-10 1.00 29-Jul-15
T P Viswanathan 29-Jan-10 1.00 29-Jul-15
Avinash Chandra Sangal 29-Jan-10 2.00 29-Jul-15
Lotus Beauty Care Products Pvt Ltd 15-Feb-10 100.00 15-Feb-20
Kotak Mahindra Bank Ltd 29-Mar-10 5,000.00 29-Sep-15
Total 80,097.00

(Rs. in Lacs)
TERM LOAN FROM BANKS Date Of Amount Date of Maturity
Financing Outstanding as
Document on March 31,
2010

HSBC Bank 21-Sep-07 8,000.00 20-Sep-10

ICICI Bank 11-Sep-09 10,000.00 11-Mar-11
HSBC Bank 29-Oct-09 52,647.21 Various dt from
26/07/10 to 26/07/12
70,647.21

(Rs. in Lacs)
- 157 -
 TERM LOAN FROM INSTITUTIONS Date Of Amount Date of Maturity
Financing Outstanding as
Document on March 31,
2010

Kotak Mahindra Prime Ltd 16-Mar-07 11,000.00 16-Jun-10

Kotak Mahindra Prime Ltd 30-Mar-07 16,500.00 30-Jun-10
Kotak Mahindra Prime Ltd 20-Mar-07 7,500.00 22-Sep-10
Total 35,000.00

(Rs. in Lacs)

INTER CORPORATE DEPOSITS

Particulars Date of Amount Maturity Date
disbursement Outstanding
as on March
31, 2010
4.43 13/02/2011
Shakti Finance 13-Feb-08
Shakti Finance 26-Feb-08 12.25 26/02/2012
16.68

(Rs. in Lacs)

FIXED DEPOSITS

Outstanding
amount as on
Description Redemption Month
March 31,
2010
Fixed deposits 11,479.51 April 2010- March 2015

Total 11,479.51

UNSECURED LOANS – SUBORDINATED DEBTS

The Company has issued Subordinated debts of face value of Rs.1,000/- each on a private placement basis of which Rs.
126,502.49 lacs is outstanding as on March 31, 2010, the details of which are set out below:
(Rs. in lacs)
Outstanding
Number of
Description amount as on Redemption Month
Subordinated Debts
March 31, 2010
Subordinated debts 327,020 126,502.49 April 2010 - July 2015

Total 327,020 126,502.49

C. Asset Liability Mismatch

A portion of our funding requirements is met through short-term funding sources, being, bank loans, working capital
demand loans, cash credit, short term loans and commercial papers. Further, a large portion of our loan assets mature
over a medium term, while comparatively some of our liabilities in connection with the credit facilities obtained by us
- 158 -
are for a relatively shorter periods of time. Consequently, our inability to obtain additional credit facilities or renew our
existing credit facilities, in a timely manner or at all, may lead to mismatches between our assets and liabilities.

Based on the structural liquidity position of our Company as on September 30, 2009 as per the RBI norms, our Company
has positive asset liability mismatch of Rs.456,401 lacs over a period of six months till March 31, 2010 based on our
submission dated October 30, 2009 to RBI.

Restrictive Covenants under our Financing Arrangements:

Some of the corporate actions for which our Company requires the prior written consent of lenders include the following:

1. to declare and/ or pay dividend to any of its shareholders whether equity or preference, during any financial year
unless our Company has paid to the lender the dues payable by our Company in that year;

2. to undertake or permit any merger, amalgamation or compromise with its shareholders, creditors or effect any
scheme of amalgamation or reconstruction;

3. to create or permit any charges or lien on any mortgaged properties;

4. to amend its MOA and AOA or alter its capital structure; and

5. to make any major investments by way of deposits, loans, share capital, etc. in any manner.

Servicing behaviour on existing debt securities, payment of due interest on due dates on term loans and debt
securities.

As on the date of this Prospectus, there has been no default in payment of principal or interest on any existing term loan
and debt security issued by the Issuer in the past.

- 159 -
 MATERIAL DEVELOPMENTS

Save as disclosed hereinafter, there have been no developments since December 31, 2009 which effect the operations, or
financial condition of our Company:

• On January 28, 2010, our Company issued and allotted 11,658,552 Equity Shares of at a price of Rs.500.80 per
such Equity Share, aggregating to Rs. 58,386.03 lacs to qualified institutional buyers pursuant to the provisions
of Chapter VIII of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements)
Regulations, 2009, as amended.

• Shriram Automall India Limited, a subsidiary of our Company was incorporated pursuant to a certificate of
incorporation dated February 11, 2010 issued by the Registrar of Companies, Chennai, Tamil Nadu and having
its registered office situated at 123, Angappa Naickan Street, Chennai 600001, Tamil Nadu, India.

• On March 12, 2010, our Company bought back 421523 non convertible debentures out of the non convertible
debentures issued pursuant to the public issue vide prospectus dated July 16, 2009, from the open market
through a registered broker.

• On March 26, 2010 our Company has issued and allotted 1,084,700 Equity Shares at a price of Rs. 35 per
Equity Share pursuant to the exercise of stock options issued under our ESOP scheme. Our Company has made
separate applications dated April 13, 2010, to MSE, NSE, and BSE in connection with obtaining approval
therefrom, for trading of the aforementioned Equity Shares. We have recevied approvals for the trading of the
aforementioned Equity Shares from the BSE and the MSE vide their letters dated April 19, 2010 and April 30,
2010, respectively. The approval from the NSE in connection with the trading of the aforementioned Equity
Shares is still awaited.

- 160 -
 SECTION VI : ISSUE RELATED INFORMATION

TERMS OF THE ISSUE

The NCDs being offered as part of the Issue are subject to the provisions of the Debt Regulations, the Act, the
Memorandum and Articles of Association of our Company, the terms of this Prospectus, the Application
Forms, the terms and conditions of the Debenture Trust Deed, other applicable statutory and/or regulatory
requirements including those issued from time to time by SEBI/the Government of India/NSE, RBI, and/or
other authorities relating to the issue and listing of securities and any other documents that may be executed in
connection with the NCDs.

Ranking of Secured NCDs

The Secured NCDs would constitute direct and secured obligations of ours and shall rank pari passu inter se, and
subject to any obligations under applicable statutory and/or regulatory requirements, shall also, with regard to
the amount invested, be secured by way of first and exclusive charge on the identified immovable property and the
specified future loan receivables of the company. The claims of the secured NCD holders shall be superior to the
claims of any unsecured creditors, subject to applicable statutory and/or regulatory requirements.

Ranking of Unsecured NCDs

The Unsecured NCDs would constitute direct, unsecured and subordinated obligations of ours and shall rank pari
passu inter se, and subject to any obligations under applicable statutory and/or regulatory requirements. The
claims of the unsecured NCD holders shall be subordinated to those of the other creditors of our Company, subject
to applicable statutory and/or regulatory requirements. Our Company may, subject to applicable RBI
requirements and other applicable statutory and/or regulatory provisions, treat the Unsecured NCDs as Tier
II capital.

Debenture Redemption Reserve

Section 117C of the Act states that any company that intends to issue debentures must create a DRR to which adequate
amounts shall be credited out of the profits of the company until the redemption of the debentures. The Ministry of
Corporate Affairs has, through its circular dated April 18, 2002, (“Circular”), specified that the quantum of DRR to be
created before the redemption liability actually arises in normal circumstances should be ‘adequate’ to pay the value of
the debentures plus accrued interest, (if not already paid), till the debentures are redeemed and cancelled. The Circular
however further specifies that, for NBFCs like our Company, (NBFCs which are registered with the RBI under Section
45-IA of the RBI Act), the adequacy of the DRR will be 50% of the value of debentures issued through the public issue.
Accordingly our Company is required to create a DRR of 50% of the value of debentures issued through the public issue.
As further clarified by the Circular, the amount to be credited as DRR will be carved out of the profits of the company
only if there is profit for the particular year and there is no obligation on the part of the company to create DRR if there
is no profit for the particular year. Our Company shall credit adequate amounts to DRR, from its profits every year until
such NCDs are redeemed. The amounts credited to DRR shall not be utilized by the company except for the redemption
of the NCDs.

Face Value

The face value of each of the Secured NCDs shall be Rs.1,000.

The face value of each of the Unsecured NCDs shall be Rs.1,000.

NCD holder not a Shareholder

The NCD holders will not be entitled to any of the rights and privileges available to the equity and/or preference
shareholders of our Company.

Rights of NCD holders

- 161 -
Some of the significant rights available to the NCD holders are as follows:

1. The NCDs shall not, except as provided in the Act, confer upon the holders thereof any rights or privileges
available to our members including the right to receive notices or annual reports of, or to attend and/or
vote, at our general meeting. However, if any resolution affecting the rights attached to the NCDs is to
be placed before the members, the said resolution will first be placed before the concerned registered NCD
holders for their consideration. In terms of Section 219(2) of the Act, holders of NCDs shall be entitled to a
copy of the balance sheet and copy of trust deed on a specific request made to us.

2. Subject to applicable statutory/regulatory requirements, including requirements of the RBI, the rights, privileges and
conditions attached to the NCDs may be varied, modified and/or abrogated with the consent in writing of the
holders of at least three-fourths of the outstanding amount of the NCDs or with the sanction of a special
resolution passed at a meeting of the concerned NCD holders, provided that nothing in such consent or
resolution shall be operative against us, where such consent or resolution modifies or varies the terms and
conditions governing the NCDs, if the same are not acceptable to us.

3. The registered NCD holder or in case of joint-holders, the one whose name stands first in the register of
debenture holders shall be entitled to vote in respect of such NCDs, either in person or by proxy, at any
meeting of the concerned NCD holders and every such holder shall be entitled to one vote on a show of
hands and on a poll, his/her voting rights shall be in proportion to the outstanding nominal value of NCDs held
by him/her on every resolution placed before such meeting of the NCD holders.

4. The NCDs are subject to the provisions of the Debt Regulations, the Act, the Memorandum and Articles of Association
of our Company, the terms of this Prospectus, the Application Forms, the terms and conditions of the Debenture Trust
Deed, requirements of the RBI, other applicable statutory and/or regulatory requirements relating to the issue and
listing, of securities and any other documents that may be executed in connection with the NCDs.

5. A register of NCD holders will be maintained in accordance with Section 152 of the Act and all interest and
principal sums becoming due and payable in respect of the NCDs will be paid to the registered holder
thereof for the time being or in the case of joint-holders, to the person whose name stands first in the
Register of NCD holders as on the record date.

6. Subject to compliance with RBI requirements, NCDs can be rolled over only with the consent of 75% of the
NCD holders after providing at least 21 days prior notice for such roll over and in accordance with the Debt
Regulations. The Company shall redeem the debt securities of all the debt securities holders, who have not
given their positive consent to the roll-over.

The aforementioned rights of the NCD holders are merely indicative. The final rights of the NCD holders will be
as per the Debenture Trust Deed to be executed between the Company and the Debenture Trustee.

Minimum Subscription

If our Company does not receive the minimum subscription of 75 % of the Base Issue, i.e. Rs. 18,750 lacs, prior to
allotment, the entire subscription shall be refunded to the applicants within 30 days from the date of closure of the Issue.
If there is delay in the refund of subscription by more than 8 days after our Company becomes liable to pay the
subscription amount, our Company will pay interest for the delayed period, at rates prescribed under sub-sections (2) and
(2A) of Section 73 of the Companies Act, 1956.

Market Lot & Trading Lot

Under Section 68B of the Act, the NCDs shall be allotted only in dematerialized form. As per the Debt Regulations,
the trading of the NCDs shall be in dematerialised form only. Since trading of the NCDs is in dematerialised form,
the tradable lot is one NCD.

Allotment in the Issue will be in electronic form in multiples of one NCD. For details of allotment refer to chapter
titled “Issue Procedure” under section titled “Issue Related Information” beginning on page 161 of this Prospectus.
- 162 -
Nomination facility to NCD holder

In accordance with Section 109A of the Act, the sole NCD holder or first NCD holder, along with other joint NCD
holders (being individual(s)) may nominate any one person (being an individual) who, in the event of death of the
sole holder or all the joint-holders, as the case may be, shall become entitled to the NCD. A person, being a
nominee, becoming entitled to the NCD by reason of the death of the NCD holder(s), shall be entitled to the
same rights to which he would be entitled if he were the registered holder of the NCD. Where the nominee is a
minor, the NCD holder(s) may make a nomination to appoint, in the prescribed manner, any person to become
entitled to the NCD(s), in the event of his death, during the minority. A nomination shall stand rescinded upon
sale of a NCD by the person nominating. A buyer will be entitled to make a fresh nomination in the manner
prescribed. When the NCD is held by two or more persons, the nominee shall become entitled to receive the
amount only on the demise of all the holders. Fresh nominations can be made only in the prescribed form available
on request at our Registered/ Corporate Office or at such other addresses as may be notified by us.

NCD holder(s) are advised to provide the specimen signature of the nominee to us to expedite the transmission of the
NCD(s) to the nominee in the event of demise of the NCD holder(s). The signature can be provided in the
Application Form or subsequently at the time of making fresh nominations. This facility of providing the
specimen signature of the nominee is purely optional.

In accordance with Section 109B of the Act, any person who becomes a nominee by virtue of the provisions of
Section 109A of the Act, shall upon the production of such evidence as may be required by our Board, elect
either:

(a) to register himself or herself as the holder of the NCDs; or

(b) to make such transfer of the NCDs, as the deceased holder could have made.

Further, our Board may at any time give notice requiring any nominee to choose either to be registered himself or herself or to
transfer the NCDs, and if the notice is not complied with, within a period of 90 days, our Board may thereafter withhold payment
of all interests or other monies payable in respect of the NCDs, until the requirements of the notice have been complied with.

Notwithstanding anything stated above, since the allotment of NCDs in this Issue will be made only in dematerialised mode,
there is no need to make a separate nomination with our Company. Nominations registered with the respective Depository
Participant of the applicant would prevail. If the investors require changing their nomination, they are requested to inform their
respective Depository Participant.

Jurisdiction

Exclusive jurisdiction for the purpose of the Issue is with the competent courts of jurisdiction in Mumbai, India.

Application in the Issue

NCDs being issued through this Prospectus can be applied for in the dematerialised form only through a valid
Application Form filled in by the applicant along with attachment, as applicable.

Period of Subscription

The subscription list shall remain open for a period as indicated below, with an option for early closure or extension by
such period, upto a period of 30 days from the date of opening of the Issue, as may be decided by the Board of Directors
of our Company, subject to necessary approvals. In the event of an earlier closure of subscription list of the public issue,
our Company shall ensure that notice is given, about the earlier closure of subscription list of the public issue to the
Investors through advertisements atleast 3 days prior to such earlier closure date.

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Issue Opens on May 17, 2010
Closing Date May 31, 2010

Restriction on transfer of NCDs

There are no restrictions on transfers and transmission of NCDs and on their consolidation/ splitting except as may be
required under RBI requirements (in the case of unsecured NCDs) and as provided in our Articles. Please refer to the
section titled “Summary of the Key Provisions of the Articles of Association” beginning on page 224 of this Prospectus.

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 ISSUE STRUCTURE

Public Issue of NCDs aggregating upto Rs. 25,000 lacs with an option to retain over-subscription upto Rs. 25,000 lacs
for issuance of additional Secured NCDs, aggregating to a total of up to Rs. 50,000 lacs including a reservation for
Unsecured NCDs aggregating upto Rs. 20,000 lacs. The Unsecured NCDs will be in the nature of subordinated debt and
will be eligible for Tier II capital.*

* Note:

Our Company shall be entitled to issue and allot Secured NCDs, subject
to demand, aggregating upto the Issue Size i.e. upto Rs. 50,000 lacs, in
case of a shortfall in demand for Unsecured NCDs.
Illustrations:
• In case of NIL demand for Unsecured NCDs, our Company
shall be entitled to issue Secured NCDs aggregating upto Rs.
50,000 lacs, provided that our Company recieves adequate
demand for such Secured NCDs.

• In case our Company receives a demand for Unsecured NCDs

aggregating to Rs. 10,000 lacs, our Company shall be entitled
to issue Secured NCDs aggregating upto Rs. 40,000 lacs,
provided that our Company recieves adequate demand for
such Secured NCDs.

Alternatively, our Company shall be entitled to issue and allot Unsecured
NCDs, subject to demand, aggregating upto the Issue Size i.e. upto Rs.
50,000 lacs, in case of a shortfall in demand for Secured NCDs.
Illustrations:
• In case of NIL demand for Secured NCD, our Company shall
be entitled to issue Unsecured NCDs aggregating upto Rs.
50,000 lacs, provided that our Company recieves adequate
demand for such Unsecured NCDs.

• In case our Company receives a demand for Secured NCDs

aggregating to Rs. 10,000 lacs, our Company shall be entitled
to issue Unsecured NCDs aggregating upto Rs. 40,000 lacs,
provided that our Company recieves adequate demand for
such Unsecured NCDs.

The key common terms and conditions of the Secured NCDs and the Unsecured NCDs are as follows:
Particulars Terms and Conditions

Minimum Application Size The minimum number of NCDs per application form will be calculated
on the basis of the total number of NCDs applied for under each such
Application Form and not on the basis of any specific option

Mode of allotment Compulsorily in dematerialised form

Terms of Payment Full amount on application

Trading Lot 1 (one) NCD

Who can Apply Category I

• Public Financial Institutions, Statutory Corporations, Commercial
Banks, Co-operative Banks and Regional Rural Banks, which are
authorised to invest in the NCDs;
• Provident Funds, Pension Funds, Superannuation Funds and Gratuity
Fund, which are authorised to invest in the NCDs;
• Venture Capital funds registered with SEBI;
• Insurance Companies registered with the IRDA;

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 • National Investment Fund;
• Mutual Funds;
Category II
• Companies; bodies corporate and societies registered under the
applicable laws in India and authorised to invest in the NCDs;
• Public/private charitable/religious trusts which are authorised to invest
in the NCDs;
• Scientific and/or industrial research organisations, which are authorised
to invest in the NCDs;
• Partnership firms in the name of the partners; and
• Limited liability partnerships formed and registered under the
provisions of the Limited Liability Partnership Act, 2008 (No. 6 of
2009)
Category III*
The following persons/entities
• Resident Indian individuals; and
• Hindu Undivided Families through the Karta.

*With respect to applications received from Category III applicants, applications by applicants who apply for
NCDs aggregating to a value not more than Rs. 5 Lac, across all series of NCDs irrespective of whether they are Secured
NCDs or Unsecured NCDs, (Option I, Option II, Option III ,Option IV and/or Option V), shall be grouped together,
(“Reserved Individual Portion”) while applications by applicants who apply for NCDs aggregating to a value
exceeding Rs. 5 Lac, across all series of NCDs, irrespective of whether they are Secured NCDs or Unsecured NCDs,
(Option I, Option II, Option III Option ,IV and/or Option V), shall be separately grouped together, (“Unreserved
Individual Portion”).

Participation by any of the above-mentioned investor classes in this Issue will be subject to applicable statutory and/or
regulatory requirements. Applicants are advised to ensure that applications made by them do not exceed the
investment limits or maximum number of Secured NCDs and/or Unsecured NCDs that can be held by them under
applicable statutory and/or regulatory provisions.

In case of Application Form being submitted in joint names, the applicants should ensure that the de-mat account is also held
in the same joint names, and the names are in the same sequence in which they appear in the Application Form.

Applicants are advised to ensure that they have obtained the necessary statutory and/or regulatory
permissions/consents/approvals in connection with applying for, subscribing to, or seeking allotment of NCDs
pursuant to the Issue.

For further details, please read “Issue Procedure” on page 188.

Principal Terms and Conditions of the Issue

TERMS AND CONDITIONS IN CONNECTION WITH THE SECURED NCDs

Nature of the Secured NCDs

We are offering Secured NCDs which shall have a fixed rate of interest. The Secured NCDs will be issued at a face
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value of Rs. 1,000/- per Secured NCD. Interest on the Secured NCDs shall be payable on semi-annual or on an
annual basis, as the case may be, as set out hereinafter. The terms of the Secured NCDs offered pursuant to the Issue
are as follows:

Options I II III
Frequency of Interest Annual Semi-Annual Annual
Payment
Minimum Application Rs. 10,000 Rs. 10,000 Rs. 10,000
Or
Rs. 10,000/- (10 NCDs) (for all options of Secured NCDs and Unsecured
NCDs, namely Options I, II, III, IV, and V either taken individually or
collectively)
In Multiples of Rs. 1,000 Rs. 1,000 Rs. 1,000
Face Value of NCDs Rs. 1,000 Rs. 1,000 Rs. 1,000
(Rs. / NCD)
Issue Price (Rs. / NCD) Rs. 1,000 Rs. 1,000 Rs. 1,000
Mode of Interest Through Various Through Various Through Various
Payment options available options available options available
Coupon (%) p.a.** 9.00% per annum 9.50% per annum 9.75% per annum

Premium (Rs. per N/A N/A N/A

NCD)
Effective Yield (per For Secured NCD For Secured NCD For Secured NCD
annum) ** holders in the Reserved holders in the Reserved holders in the Reserved
Individual Portion – Individual Portion – Individual Portion –
9.75% 10.51% 10.50%
For Secured NCD For Secured NCD For Secured NCD
holders in the holders in the holders in the
Unreserved Individual Unreserved Individual Unreserved Individual
Portion – 9.50% Portion – 10.25% Portion – 10.25%
For all other Secured For all other Secured For all other Secured
NCD holders – 9.00% NCD holders – 9.73% NCD holders – 9.75%
Put and call option Exercisable at the end of Exercisable at the end of N/A
36 months from the 60 months from the
Deemed Date of Deemed Date of
Allotment Allotment
Tenor 60 months 84 months 60 months
Redemption Date 60 months from the 84 months from the 60 months from the
Deemed Date of Deemed Date of Deemed Date of
Allotment. * Allotment. * Allotment.

Redemption Amount Repayment of the Face Repayment of the Face Re-payment of the Face
(Rs./NCD) Value plus any interest Value plus any interest Value of the NCDs in
that may have accrued at that may have accrued at stages between the
the Redemption Date, or the Redemption Date, or period commencing on
at the date of early at the date of early the expiry of 36 months
redemption if any Put redemption if any Put till Redemption Date,
Option or Call Option is Option or Call Option is with 40% of the Face
exercised, as the case exercised, as the case Value of the NCDs
may be. * may be.* payable at the end of the
36 months from the
Deemed Date of
Allotment, 40% of the
Face Value of the
NCDs, payable at the
end of 48 months from

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Options I II III
the Deemed Date of
Allotment and 20% of
the Face Value of the
NCDs payable at the
end of 60 months from
the Deemed Date of
Allotment. The Face
Value at each stage of
redemption as detailed
above, shall be payable
together with any
interest which may have
accrued on the date of
such redemption.
Nature of Indebtedness Pari Passu with other Pari Passu with other Pari Passu with other
secured creditors and secured creditors and secured creditors and
priority over unsecured priority over unsecured priority over unsecured
creditors creditors creditors
Credit Rating

CARE: CARE AA+ for an CARE AA+ for an CARE AA+ for an
amount of upto Rs. amount of upto Rs. amount of upto Rs.
50,000 Lacs 50,000 Lacs 50,000 Lacs

CRISIL: ‘AA/Stable’ for an ‘AA/Stable’ for an ‘AA/Stable’ for an

amount of upto Rs. amount of upto Rs. amount of upto Rs.
50,000 Lacs 50,000 Lacs 50,000 Lacs
* Subject to exercise of put/call option.
** Option I, II and III Secured NCD holders in the Reserved Individual Portion shall be entitled to an additional interest
rate of 0.75% per annum, (“Reserved Individual Interest Rate”). Option I, II and III Secured NCD holders in the
Unreserved Individual Portion shall be entitled to an additional interest rate of 0.50% per annum, (“Unreserved
Individual Interest Rate”). Subject to the terms of this Prospectus, in addition, Senior Citizens in the Reserved Individual
Portion holding Option I, II and III Secured NCDs shall be entitled to an additional interest rate of 0.25% per annum over
and above the Reserved Individual Interest Rate.

Interest and Payment of Interest

A. Interest

In case of Option I Secured NCDs, interest would be paid annually at the rate of 9.00% per annum* on
the amount outstanding from time to time, commencing from the Deemed Date of Allotment of each
Option I Secured NCD. Option I Secured NCDs shall be redeemed at the Face Value thereof along with the
interest accrued thereon, if any, at the end of 60 months from the deemed date of allotment, or on the date of
early redemption in case of the exercise of any put/call option.

In case of Option II, interest would be paid semi annually at the rate of 9.50% per annum*on the amount
outstanding from time to time, commencing from the Deemed Date of Allotment of each Option II
Secured NCD. Option II Secured NCDs shall be redeemed at the Face Value thereof along with the interest
accrued thereon, if any,at the end of 84 months from the deemed date of allotment, or on the date of early
redemption in case of the exercise of any put/call option.

In case of Option III, interest would be paid annually at the rate of 9.75% per annum* on the amount
outstanding from time to time, commencing from the Deemed Date of Allotment of each Option III
Secured NCD. Option III Secured NCDs shall be redeemed at the Face Value thereof along with the interest
accrued thereon, if any, at the end of 60 months from the deemed date of allotment.

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 If the date of interest payment falls on a Saturday, Sunday or a public holiday in Mumbai or any other
payment centre notified in terms of the Negotiable Instruments Act, 1881, then interest would be paid on
the next working day. Payment of interest would be subject to the deduction as prescribed in the I.T. Act
or any statutory modification or re-enactment thereof for the time being in force.

As per clause (ix) of Section 193 of the I.T. Act, no tax is required to be withheld on any interest payable on any
security issued by a company, where such security is in dematerialized form and is listed on a recognized stock
exchange in India in accordance with the Securities Contracts (Regulation) Act, 1956 (42 of 1956) and the rules
made thereunder. Accordingly, no tax will be deducted at source from the interest on listed Secured NCD held
in dematerialised form.

*Option I, II and III Secured NCD holders in the Reserved Individual Portion shall be entitled to an additional
interest rate of 0.75% per annum, (“Reserved Individual Interest Rate”). Option I, II and III Secured NCD
holders in the Unreserved Individual Portion shall be entitled to an additional interest rate of 0.50% per annum,
(“Unreserved Individual Interest Rate”). Subject to the terms of this Prospectus, in addition, Senior Citizens in
the Reserved Individual Portion holding Option I, II and III Secured NCDs shall be entitled to an additional
interest rate of 0.25% per annum over and above the Reserved Individual Interest Rate. Such additional interest
to Senior Citizen, shall be applicable only to the first allottees of such Secured NCDs. If Secured NCDs allotted
to any Senior Citizen are transferred or transmitted, subsequent to the allotment thereof, the subsequent holder
of such Secured NCDs (irrespective of such subsequent holder being a Senior Citizen) shall not be entitled to
the aforesaid additional interest. Please note that in case the Secured NCDs are transferred and/or
transmitted in accordance with the provisions of this Prospectus read with the provisions of the Articles
of Association of our Company, the transferee of such Secured NCDs or the deceased holder of Secured
NCDs, as the case may be, shall be entitled to any interest which may have accrued on the Secured
NCDs.

However in case of Secured NCDs held in physical form, as per the current provisions of the IT Act, tax
will not be deducted at source from interest payable on Secured NCDs held by the investor (in case of
resident individual Secured NCD holders), if such interest does not exceed Rs.2,500 in any financial year.
If interest exceeds the prescribed limit of Rs.2,500 on account of interest on Secured NCDs, then the tax
will be deducted at applicable rate. However in case of Secured NCD holders claiming non-deduction or
lower deduction of tax at source, as the case may be, the Secured NCD holder should furnish either (a) a
declaration (in duplicate) in the prescribed form i.e. (i) Form 15H which can be given by individuals who
are of the age of 65 years or more (ii) Form 15G which can be given by all applicants (other than
companies, and firms ), or (b) a certificate, from the Assessing Officer which can be obtained by all
applicants (including companies and firms) by making an application in the prescribed form i.e. Form
No.13. The aforesaid documents, as may be applicable, should be submitted to the Company quoting the
name of the sole/ first Secured NCD holder, Secured NCD folio number and the distinctive number(s) of
the Secured NCD held, prior to the record date to ensure non-deduction/lower deduction of tax at source
from interest on Secured NCD. The investors need to submit Form 15H/ 15G/certificate in original from
Assessing Officer for each financial year during the currency of Secured NCD to ensure non-deduction or
lower deduction of tax at source from interest on Secured NCD.

B. Payment of Interest

Semi-Annual Payment of Interest

For Secured NCDs subscribed under Option II, interest of 9.50%* per annum will be paid on the first
day of April and October every year, respectively (subject to the exercise of the put option by a holder of the
Option II Secured NCDs or the call option by our Company, as the case may be, in accordance with the
provisions of this Prospectus), except for the first interest payment. The first interest payment for the
period commencing from Deemed Date of Allotment till September 30, 2010 shall be made on October 1,
2010. The last interest payment will be made at the time of redemption of the Option II Secured NCD
on a pro rata basis.

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 Annual Payment of Interest

For Secured NCDs subscribed under Option I, interest of 9.00%* per annum will be paid on the first day
of April every year for the amount of remaining outstanding. The first interest payment will be made on
April 1, 2011 for the period commencing from the Deemed Date of Allotment till March 31, 2011. The last
interest payment will be made at the time of redemption of the Option I Secured NCD on a pro rata
basis.

For Secured NCDs subscribed under Option III, interest of 9.75%* per annum will be paid on the first
day of April every year for the amount of remaining outstanding towards the principal, from time to time. The
first interest payment will be made on April 1, 2011 for the period commencing from the Deemed Date of
Allotment till March 31, 2011. The last interest payment will be made at the time of redemption of the
Option III Secured NCD on a pro rata basis.

* Option I, II and III Secured NCD holders in the Reserved Individual Portion shall be entitled to an additional
interest rate of 0.75% per annum, (“Reserved Individual Interest Rate”). Option I, II and III Secured NCD
holders in the Unreserved Individual Portion shall be entitled to an additional interest rate of 0.50% per annum,
(“Unreserved Individual Interest Rate”). Subject to the terms of this Prospectus, in addition, Senior Citizens in
the Reserved Individual Portion holding Option I, II and III Secured NCDs shall be entitled to an additional
interest rate of 0.25% per annum over and above the Reserved Individual Interest Rate.

C. Payment of Interest to Secured NCD Holders

Payment of Interest will be made to those Secured NCD holders whose names appear in the register of
Secured NCD holders (or to first holder in case of joint-holders) as on record date.

We may enter into an arrangement with one or more banks in one or more cities for direct credit of interest
to the account of the investors. In such cases, interest, on the interest payment date, would be directly
credited to the account of those investors who have given their bank mandate.

We may offer the facility of NECS, NEFT, RTGS, Direct Credit and any other method permitted by RBI
and SEBI from time to time to help Secured NCD holders. The terms of this facility (including towns
where this facility would be available) would be as prescribed by RBI. Refer to the paragraph on “Manner
of Payment of Interest/Refund/Redemption” appearing in this Prospectus.

Tax exemption certificate/document, if any, must be lodged at the office of the Registrar at least 7(seven)
days prior to the record date or as specifically required, failing which tax applicable on interest will be
deducted at source on accrual thereof in our Company’s books and/or on payment thereof, in accordance
with the provisions of the IT Act and/or any other statutory modification, enactment or notification as the
case may be. A tax deduction certificate will be issued for the amount of tax so deducted.

Maturity and Redemption

The Secured NCDs issued pursuant to the Prospectus have a fixed maturity date. The date of maturity for Secured
NCDs subscribed under Option I, Option II and Option III is 60 months, 84 months and 60 months, respectively,
from the Deemed Date of Allotment. The redemption of Secured NCDs is subject to the exercise of any put / call
option with respect to Option I and Option II which can be exercised by any Secured NCD holder/ Company.

Options If put / call option is exercised At the end of maturity period

I 36 months from the Deemed date of 60 months from the Deemed Date of Allotment
Allotment
II 60 months from the Deemed Date of 84 months from the Deemed Date of Allotment
Allotment
III Not Applicable 60 months from the Deemed Date of Allotment*
* For further details please refer to “Redemption of Option III Secured NCDs”
Deemed Date of Allotment

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Deemed date of allotment shall be the date of issue of the Allotment Advice / regret.

Application Size

Each application should be for a minimum of 10 NCDs and multiples of 1 NCD thereof. The minimum application size
for each application for NCDs would be Rs. 10,000/- (for all options of Secured NCDs and Unsecured NCDS, namely,
Option I, Option II, Option III, Option IV and Option V NCDs either taken individually or collectively) and in multiples
of Rs. 1,000/- thereafter.

Applicants can apply for any or all options of Secured NCDs and/or Unsecured NCDs offered hereunder (any/all
options) using the same Application Form.

Applicants are advised to ensure that applications made by them do not exceed the investment limits or maximum
number of Secured NCDs that can be held by them under applicable statutory and or regulatory provisions.

Terms of Payment

The entire issue price of Rs. 1,000 per Secured NCD is payable on application itself. In case of allotment of lesser
number of Secured NCDs than the number of Secured NCDs applied for, our Company shall refund the excess
amount paid on application to the applicant in accordance with the terms of this Prospectus. For further details
please refer to the paragraph on “Interest on Application Money” beginning on page 186 of this Prospectus.

Record Date

The record date for payment of interest in connection with the Secured NCDs or repayment of principal in
connection therewith shall be 15 (fifteen) days prior to the date on which interest is due and payable, or the date of
redemption or early redemption or as prescribed by the NSE.

Manner of Payment of Interest / Refund / Redemption

The manner of payment of interest / refund / redemption in connection with Secured NCDs is set out below:

For Secured NCDs applied / held in electronic form:

The bank details will be obtained from the Depositories for payment of Interest / refund / redemption as the case
may be. Applicants who have applied for or are holding the Secured NCDs in electronic form, 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 the applicant at the applicant’s sole risk, and
neither the Lead Managers, the Co-Lead Manager, nor our Company or the Registrars shall have any responsibility
and undertake any liability for the same.

For Secured NCDs held in physical form:

The bank details will be obtained from the Registrar to the Issue for payment of interest / refund / redemption as
the case may be.

The mode of interest / refund / redemption payments shall be undertaken in the following order of preference:

1. Direct Credit

Investors having their bank account with the Refund Banks, shall be eligible to receive refunds, if any, through direct
credit. The refund amount, if any, would be credited directly to their bank account with the Refund Banker.

2. NECS

Payment of interest / refund / redemption shall be undertaken through NECS for applicants having an account at
the centers mentioned in NECS MICR list which has over 36,600 branches.
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This mode of payment of refunds would be subject to availability of complete bank account details including the
MICR code, IFSC code, bank account number, bank name and branch name as appearing on a cheque leaf, from
the Depositories. One of the methods for payment of interest payment / refund / redemption is through NECS for
applicants having a bank account at any of the abovementioned centers.

3. RTGS

Applicants having a bank account with a participating bank and whose interest payment / refund / redemption
amount exceeds Rs.1 lac, or such amount as may be fixed by RBI from time to time, have the option to receive
refund through RTGS. Such eligible applicants who indicate their preference to receive interest payment / refund
/ redemption through RTGS are required to provide the IFSC code in the Application Form or intimate our
Company and the Registrars to the Issue at least 7 (seven) days before the record date. Charges, if any, levied by the
applicant’s bank receiving the credit would be borne by the applicant. In the event the same is not provided,
interest payment / refund / redemption shall be made through NECS subject to availability of complete bank
account details for the same as stated above.

3. NEFT

Payment of interest / refund / redemption shall be undertaken through NEFT wherever the applicants’ bank has
been assigned the Indian Financial System Code (“IFSC”), which can be linked to a Magnetic Ink Character
Recognition (“MICR”), if any, available to that particular bank branch. IFSC Code will be obtained from the
website of RBI as on a date immediately prior to the date of payment of refund, duly mapped with MICR
numbers. Wherever the applicants have registered their nine digit MICR number and their bank account number
while opening and operating the de-mat account, the same will be duly mapped with the IFSC Code of that
particular bank branch and the payment of interest/refund/redemption will be made to the applicants through this
method.

4. Registered Post/Speed Post

For all other applicants, including those who have not updated their bank particulars with the MICR code, the interest
payment / refund / redemption orders shall be dispatched under certificate of posting for value up to Rs. 1,500/- and
through Speed Post/ Registered Post for refund orders /interest payment/redemption orders of Rs. 1,500/- and
above.

Please note that applicants are eligible to receive payments through the modes detailed in (1), (2) (3), and (4) herein
above provided they provide necessary information for the above modes and where such payment facilities are allowed
/ available.

Please note that our Company shall not be responsible to the holder of Secured NCD, for any delay in receiving credit
of interest / refund / redemption so long as our Company has initiated the process of such request in time.

Printing of Bank Particulars on Interest Warrants

As a matter of precaution against possible fraudulent encashment of refund orders and interest/redemption warrants
due to loss or misplacement, the particulars of the applicant’s bank account are mandatorily required to be given
for printing on the orders/ warrants. In relation to Secured NCDs applied and held in dematerialized form, these
particulars would be taken directly from the depositories. In case of Secured NCDs held in physical form either on
account of rematerialisation or transfer, the investors are advised to submit their bank account details with our
Company / Registrar at least 7 (seven) days prior to the record date failing which the orders / warrants will be
dispatched to the postal address of the holder of the Secured NCD as available in the records of our Company.

Bank account particulars will be printed on the orders/ warrants which can then be deposited only in the account
specified.

Loan against Secured NCDs

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Our Company, at its sole discretion, subject to applicable statutory and/or regulatory requirements, may consider
granting of a loan facility to the holders of Secured NCDs against the security of such Secured NCDs. Such loans
shall be subject to the terms and conditions as may be decided by our Company from time to time.

Buy Back of Secured NCDs

Our Company may, at its sole discretion, from time to time, consider, subject to applicable statutory and/or regulatory
requirements, buyback of Secured NCDs, upon such terms and conditions as may be decided by our Company.

Form and Denomination

In case of Secured NCDs held in physical form, a single certificate will be issued to the Secured NCD holder for the
aggregate amount (“Consolidated Certificate”) for each type of Secured NCDs. The applicant can also request for
the issue of Secured NCD certificates in denomination of one Secured NCD (“Market Lot”).

In respect of Consolidated Certificates, we will, only upon receipt of a request from the Secured NCD holder,
split such Consolidated Certificates into smaller denominations subject to the minimum of Market Lot. No fees
would be charged for splitting of Secured NCD certificates in Market Lots, but stamp duty payable, if any,
would be borne by the Secured NCD holder. The request for splitting should be accompanied by the original
Secured NCD certificate which would then be treated as cancelled by us.

Redemption of Option III Secured NCDs

We will redeem Option III Secured NCDs in stages between the period commencing on the expiry of 36 months and till
the expiry of 60 months from the Deemed Date of Allotment in the following manner:

1. 40% of the Face Value of the Option III Secured NCDs shall be redeemable at the end of 36 months from the
Deemed Date of Allotment;

2. 40% of the Face Value of the Option III Secured NCDs, shall be redeemable at the end of 48 months from the
Deemed Date of Allotment; and

3. 20% of the Face Value of the Option III Secured NCDs, shall be redeemable at the end of 60 months from the
Deemed Date of Allotment.

Upon the part redemption of the Option III Secured NCDs at the end of 36 months and 48 months from the Deemed Date
of Allotment, respectively, in accordance with the aforementioned provisions of this Prospectus, trading in such Option
III Secured NCDs, will be suspended till the required approval(s) and/or permission(s) for trading in the Option III
Secured NCDs (with respect to the outstanding value of Option III Secured NCDs) is obtained from the stock exchanges
and/or other regulatory authorities, in accordance with the applicable statutory and/or regulatory requirements.

Procedure for Redemption by Secured NCD holders

Subject to the exercise of the put option by the Secured NCD holder / call option by our Company, the
procedure for redemption is set out below:

Secured NCDs held in physical form:

No action would ordinarily be required on the part of the Secured NCD holder at the time of redemption and
the redemption proceeds would be paid to those Secured NCD holders whose names stand in the register of
Secured NCD holders maintained by us on the record date fixed for the purpose of Redemption. However, our
Company may require that the Secured NCD certificate(s), duly discharged by the sole holder/all the joint-
holders (signed on the reverse of the Secured NCD certificate(s)) be surrendered for redemption on maturity and
should be sent by the Secured NCD holder(s) by Registered Post with acknowledgment due or by hand delivery to
our office or to such persons at such addresses as may be notified by us from time to time. Secured NCD
holder(s) may be requested to surrender the Secured NCD certificate(s) in the manner as stated above, not more
than three months and not less than one month prior to the redemption date so as to facilitate timely payment.
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We may at our discretion redeem the Secured NCDs without the requirement of surrendering of the NCD certificates
by the holder(s) thereof. In case we decide to do so, the holders of Secured NCDs need not submit the Secured NCD
certificates to us and the redemption proceeds would be paid to those NCD holders whose names stand in the register
of Secured NCD holders maintained by us on the record date fixed for the purpose of redemption of Secured NCDs.
In such case, the Secured NCD certificates would be deemed to have been cancelled. Also see the para “Payment
on Redemption” given below.

NCDs held in electronic form:

No action is required on the part of Secured NCD holder(s) at the time of redemption of Secured NCDs.

Upon the part redemption of the Option III Secured NCDs at the end of 36 months and 48 months from the Deemed
Date of Allotment, respectively, in accordance with the aforementioned provisions of this Prospectus, trading in such
Option III Secured NCDs, will be suspended till the required approval(s) and/or permission(s) for trading of the Option
III Secured NCDs (with respect to the outstanding value of Option III Secured NCDs) is obtained from the stock
exchange(s) and/or other regulatory authorities, in accordance with the applicable statutory and/or regulatory
requirements.

Payment on Redemption

The manner of payment of redemption is set out below:

Secured NCDs held in physical form:

The payment on redemption of the Secured NCDs will be made by way of cheque/pay order/ electronic modes.
However, if our Company so requires, the aforementioned payment would only be made on the surrender of
Secured NCD certificate(s), duly discharged by the sole holder / all the joint-holders (signed on the reverse of the
Secured NCD certificate(s)). Despatch of cheques/pay order, etc. in respect of such payment will be made on the
Redemption Date or (if so requested by our Company in this regard) within a period of 30 days from the date of
receipt of the duly discharged NCD certificate.

In case we decide to do so, the redemption proceeds in the manner stated above would be paid on the Redemption
Date to those NCD holders whose names stand in the register of Secured NCD holders maintained by us on the
record date fixed for the purpose of Redemption. Hence the transferees, if any, should ensure lodgement of the
transfer documents with us at least 7 (seven) days prior to the record date. In case the transfer documents are not
lodged with us at least 7 (seven) days prior to the record date and we despatch the redemption proceeds to the
transferor, claims in respect of the redemption proceeds should be settled amongst the parties inter se and no
claim or action shall lie against us or the Registrars.

With respect to Option III Secured NCDs, our liability to Option III Secured NCD holder(s) to the extent of the
value of the Option III Secured NCDs redeemed, towards his/their rights including for payment or otherwise shall
stand extinguished from the date of payment of the redemption amount. The certificate(s) for all Option III
Secured NCDs shall stand extinguished upon redemption of the corresponding value of the Option III Secured
NCD(s), at the end of 36 months, 48 months or 60 months, as the case may be.

Our liability to Secured NCD holder(s) towards his/their rights including for payment or otherwise shall stand
extinguished from the date of early redemption (in case of an exercise of the put/call option)/ redemption in all
events and when we despatch the redemption amounts to the Secured NCD holder(s).

Further, we will not be liable to pay any interest, income or compensation of any kind from the date of redemption
of the Secured NCD(s).

Secured NCDs held in electronic form:

On the redemption date, or the date of early redemption (in case of an exercise of the put/call option), redemption
proceeds would be paid by cheque /pay order / electronic mode to those Secured NCD holders whose names
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appear on the list of beneficial owners given by the Depositories to us. These names would be as per the
Depositories’ records on the record date fixed for the purpose of redemption. These Secured NCDs will be
simultaneously extinguished to the extent of the amount redeemed through appropriate debit corporate action upon
redemption of the corresponding value of the Secured NCDs. It may be noted that in the entire process mentioned
above, no action is required on the part of Secured NCD holders.

Our liability to Secured NCD holder(s) towards his/their rights including for payment or otherwise shall stand
extinguished from the date of early redemption (in case of an exercise of the put/call option)/ redemption in all
events and when we despatch the redemption amounts to the Secured NCD holder(s).

Further, we will not be liable to pay any interest, income or compensation of any kind from the date of redemption
of the Secured NCD(s).

Redemption Date

Option III Secured NCDs will be redeemed in stages between the period commencing on the expiry of 36 months and till
the expiry of 60 months from the Deemed Date of Allotment, 40% of the Face Value of the Option III Secured NCDs is
payable at the end of the 36 months from the Deemed Date of Allotment, 40% of the Face Value of the Option III
Secured NCDs payable at the end of 48 months from the Deemed Date of Allotment and the balance 20% of the Face
Value of the Option III Secured NCDs is payable at the end of 60 months from the Deemed Date of Allotment.

Option I Secured NCDs will be redeemed at the expiry of 60 months from the Deemed Date of Allotment, subject to the
exercise of any put option/call option, by the Option I Secured NCD holders or our Company, as the case may be.

Option II Secured NCDs will be redeemed at the expiry of 84 months from the Deemed Date of Allotment, subject to the
exercise of any put option/call option, by the Option II Secured NCD holders or our Company, as the case may be.

Put / Call Option

With respect to Option I Secured NCDs and/or Option II Secured NCDs, the holders thereof shall at the expiry of 36
months and 60 months, from the Deemed Date of Allotment, respectively, have the right to seek redemption of such Option
I Secured NCDs and/or Option II Secured NCDs held by them, as the case may be, (“Put Option”). A Secured NCD holder
of Option I Secured NCDs and/or Option II Secured NCDs, may at his discretion, redeem any number of Option I Secured
NCDs and/or Option II Secured NCDs held by him, while exercising such Put Option.

With respect to Option I Secured NCDs and Option II Secured NCDs, our Company shall at the expiry of 36 months and 60
months, respectively have the right to redeem Option I Secured NCDs and/or Option II Secured NCDs, (“Call Option”)
respectively.

The holders of Option III Secured NCDs shall not be entitled to exercise any Put Option in connection with such Option III
Secured NCDs held by them. Our Company shall not be entitled to exercise any Call Option in connection with any Option
III Secured NCDs.

Procedure for Exercise of Put Option

At the expiry of 36 months with respect to Option I Secured NCDs and at the expiry of 60 months in connection with
Option II Secured NCDs, from the Deemed Date of Allotment, (“Early Redemption (Put) Date”), a holder of Option I
and/or Option II Secured NCDs has the right to exercise his Put Option with respect to the Option I Secured NCDs and/or
Option II Secured NCDs held by him within 30 days from the Early Redemption (Put) Date (“Early Redemption (Put)
Period”).

During the Early Redemption (Put) Period, a Secured NCD holder seeking to exercise his Put Option can approach our
Company in writing of his intention to redeem any or all of the Option I and/or Option II Secured NCDs held by him, (a
separate letter will be required for redemption under each series, (either Option I or Option II), of Secured NCDs held by
him).

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The Option I and/or Option II Secured NCDs with respect to which an Secured NCD holder exercises his Put Option will be
redeemed within 30 (thirty) days from the expiry of the Early Redemption (Put) period.

Procedure for Exercise of Call Option

At the expiry of 36 months with respect to Option I Secured NCDs and at the expiry of 60 months in connection with
Option II Secured NCDs, from the Deemed Date of Allotment, (“Early Redemption (Call) Date”), our Company has the
right to exercise its Call Option with respect to Option I Secured NCDs and/or Option II Secured NCDs within 30 days
from the Early Redemption (Call) Date (“Early Redemption (Call) Period”).

During the Early Redemption (Call) Period, our Company can send a notice in writing to the holder of any Option I or
Option II Secured NCDs, (as on record on the Early Redemption (Call) Date), calling for redemption of all Option I and/or
Option II Secured NCDs that are outstanding. The Call can be exercised for NCDs outstanding Option I and/or outstanding
Option II Secured NCDs.

The Option I and/or Option II Secured NCDs with respect to which our Company exercises its Call Option will be
redeemed within 30 (thirty) days from the expiry of the Early Redemption (Call) Period.

Method for calculation for Early Redemption

On exercise of the Put Option by the holders of Option I and/or Option II Secured NCDs and/or the Call Option by our
Company, in connection with Option I and/or Option II Secured NCDs, as the case may be, the Secured NCDs will be
redeemed at their respective face value along with interest accrued thereon, if any.

Right to Reissue Secured NCD(s)

Subject to the provisions of the Act, where we have fully redeemed or repurchased any Secured NCD(s), we shall
have and shall be deemed always to have had the right to keep such Secured NCDs in effect without extinguishment
thereof, for the purpose of resale or reissue and in exercising such right, we shall have and be deemed always to
have had the power to resell or reissue such Secured NCDs either by reselling or reissuing the same Secured
NCDs or by issuing other Secured NCDs in their place. The aforementioned right includes the right to reissue
original Secured NCDs.

Transfer/Transmission of Secured NCD (s)

The Secured NCDs shall be transferred or transmitted freely in accordance with the applicable provisions of the
Act. The provisions relating to transfer and transmission and other related matters in respect of our shares
contained in the Articles and the Act shall apply, mutatis mutandis (to the extent applicable to debentures) to the
Secured NCD(s) as well. In respect of the Secured NCDs held in physical form, a suitable instrument of transfer
as may be prescribed by the Issuer may be used for the same. The Secured NCDs held in dematerialised form
shall be transferred subject to and in accordance with the rules/procedures as prescribed by NSDL/CDSL and
the relevant DPs of the transfer or transferee and any other applicable laws and rules notified in respect thereof.
The transferee(s) should ensure that the transfer formalities are completed prior to the record date. In the
absence of the same, interest will be paid/redemption will be made to the person, whose name appears in the
register of debenture holders maintained by the Depositories. In such cases, claims, if any, by the transferees
would need to be settled with the transferor(s) and not with the Issuer or Registrar.

For Secured NCDs held in electronic form:

The normal procedure followed for transfer of securities held in dematerialised form shall be followed for transfer
of these Secured NCDs held in electronic form. The seller should give delivery instructions containing details of
the buyer’s DP account to his depository participant.

In case the transferee does not have a DP account, the seller can re-materialise the Secured NCDs and thereby
convert his dematerialised holding into physical holding. Thereafter the Secured NCDs can be transferred in the
manner as stated above.

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In case the buyer of the Secured NCDs in physical form wants to hold the Secured NCDs in dematerialised form,
he can choose to dematerialise the securities through his DP.

Joint-holders

Where two or more persons are holders of any Secured NCD(s), they shall be deemed to hold the same as joint
holders with benefits of survivorship subject to other provisions contained in the Articles.

Sharing of Information

We may, at our option, use on our own, as well as exchange, share or part with any financial or other
information about the Secured NCD holders available with us, with our subsidiaries, if any and affiliates and
other banks, financial institutions, credit bureaus, agencies, statutory bodies, as may be required and neither we or
our affiliates nor their agents shall be liable for use of the aforesaid information.

Notices

All notices to the Secured NCD holder(s) required to be given by us or the Debenture Trustee will be sent by post/
courier to the Registered Holders of the Secured NCD(s) from time to time.

Issue of Duplicate Secured NCD Certificate(s)

If any Secured NCD certificate(s) is/are mutilated or defaced or the cages for recording transfers of Secured
NCDs are fully utilised, the same may be replaced by us against the surrender of such certificate(s). Provided,
where the Secured NCD certificate(s) are mutilated or defaced, the same will be replaced as aforesaid only if the
certificate numbers and the distinctive numbers are legible.

If any Secured NCD certificate is destroyed, stolen or lost then upon production of proof thereof to our satisfaction
and upon furnishing such indemnity/security and/or documents as we may deem adequate, duplicate Secured NCD
certificate(s) shall be issued.

Security

The principal amount of the Secured NCDs to be issued in terms of this Prospectus together with all interest due on the
Secured NCDs, as well as all costs, charges, all fees, remuneration of Debenture Trustee and expenses payable in respect
thereof shall be secured by way of first charge in favour of the Debenture Trustee on an identified immovable property and
specified future receivables of our Company as may be decided mutually by our Company and the Debenture Trustee.

Our Company will create appropriate security in favour of the Debenture Trustee for the Secured NCD holders on the
assets adequate to ensure 100% asset cover for the Secured NCDs, which shall be free from any encumbrances.

Our Company intends to enter into an agreement with the Debenture Trustee, (‘Debenture Trust Deed’), the
terms of which will govern the appointment of the Debenture Trustee. Our Company proposes to complete the
execution of the Debenture Trust Deed during the subscription period after the minimum subscription for the
Issue has been achieved and utilize the funds after the stipulated security has been created.

Under the terms of the Debenture Trust Deed, our Company will covenant with the Debenture Trustee that it
will pay the Secured NCD holders the principal amount on the Secured NCDs on the relevant redemption date
and also that it will pay the interest due on Secured NCDs on the rate specified in this Prospectus and in the
Debenture Trust Deed

Trustees for the Secured NCD holders

We have appointed IDBI Trusteeship Services Limited to act as the Debenture Trustees for the Secured NCD
holders. We and the Debenture Trustee will execute a Debenture Trust Deed, inter alia, specifying the powers,
authorities and obligations of the Debenture Trustee and us. The Secured NCD holder(s) shall, without further act or
deed, be deemed to have irrevocably given their consent to the Debenture Trustee or any of its agents or authorised
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officials to do all such acts, deeds, matters and things in respect of or relating to the Secured NCDs as the Debenture
Trustee may in its absolute discretion deem necessary or require to be done in the interest of the Secured NCD
holder(s). Any payment made by us to the Debenture Trustee on behalf of the Secured NCD holder(s) shall
discharge us pro tanto to the Secured NCD holder(s).

The Debenture Trustee will protect the interest of the Secured NCD holders in the event of default by us in regard
to timely payment of interest and repayment of principal and they will take necessary action at our cost.

Future Borrowings

We will be entitled to borrow/raise loans or avail of financial assistance in whatever form as also to issue
debentures/Secured NCDs/other securities in any manner having such ranking in priority, pari passu or otherwise,
subject to applicable consents, approvals or permissions that may be required under any
statutory/regulatory/contractual requirement, and change the capital structure including the issue of shares of any
class, on such terms and conditions as we may think appropriate, without the consent of, or intimation to, the
Secured NCD holders or the Debenture Trustee in this connection.

Nature of Unsecured NCDs

We are offering Unsecured NCDs which will be issued at a face value of Rs. 1,000/- per Unsecured NCD. Interest
on the Option V Unsecured NCDs shall be payable on an annual basis, and there shall be no interest payable on the
Option IV Unsecured NCDs, as set out hereinafter. The Option IV Unsecured NCDs, however shall be redeemable
at a premium of Rs. 1,000 at the end of its tenor. The terms of the Unsecured NCDs offered pursuant to the Issue are
as follows:

Options IV V
Name Double Bond
Frequency of Interest Payment Not Applicable Annual
Minimum Application Rs. 10,000 Rs. 10,000
Or
Rs. 10,000/- (10 NCDs) (for all options of Secured NCDs and
Unsecured NCDs, namely Options I, II, III, IV, and V either taken
individually or collectively)
In Multiples of Rs. 1,000 Rs. 1,000
Face Value of NCDs Rs. 1,000 Rs. 1,000
(Rs. / NCD)
Issue Price (Rs. / NCD) Rs. 1,000 Rs. 1,000
Mode of Interest Payment Not Applicable Through Various options
available
Coupon (%) p.a. Not Applicable 10.25% per annum**

Premium (Rs. per NCD) Rs. 1,000 N/A

Yield (per annum) For Unsecured NCD holders in
the Reserved Individual Portion –
11.25%
For Unsecured NCD holders in
the Unreserved Individual Portion
– 10.81%
For all other Unsecured NCD
holders – 10.41%
Put and call option N/A
Tenor For Unsecured NCD holders in
the Reserved Individual Portion –
78 months
For Unsecured NCD holders in
the Unreserved Individual Portion
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For Unsecured NCD holders in
the Reserved Individual Portion –
11.00%
For Unsecured NCD holders in
the Unreserved Individual Portion
– 10.75%
For all other Unsecured NCD
holders – 10.25%**
N/A
84 months
Options IV V
Name Double Bond
– 81 months
For all other Unsecured NCD
holders – 84 months
Redemption Date For Unsecured NCD holders in 84 months from the Deemed Date
the Reserved Individual Portion – of Allotment
78 months from the Deemed Date
of Allotment
For Unsecured NCD holders in
the Unreserved Individual Portion
– 81 months from the Deemed
Date of Allotment
For all other Unsecured NCD
holders – 84 months from the
Deemed Date of Allotment
Redemption Amount Repayment of the Face Value Repayment of the Face Value
(Rs./NCD) plus a premium of Rs. 1,000 plus any interest that may have
accrued
Nature of Indebtedness Subordinated debt and will be Subordinated debt and will be
eligible for Tier II capital. eligible for Tier II capital.
Credit Rating

CARE: CARE AA for an amount of upto CARE AA for an amount of upto

Rs. 50,000 Lacs Rs. 50,000 Lacs
CRISIL: AA/Stable for an amount of upto AA/Stable for an amount of upto
Rs. 50,000 Lacs Rs. 50,000 Lacs
** Option V Unsecured NCD holders in the Reserved Individual Portion shall be entitled to an additional interest rate of
0.75% per annum. Option V Unsecured NCD holders in the Unreserved Individual Portion shall be entitled to an
additional interest rate of 0.50% per annum.

Interest and Payment of Interest / Premium on Redemption

A. Interest / Premium

In case of Option IV Unsecured NCDs, no interest shall be payable. However, Option IV Unsecured
NCDs shall be redeemed at the Face Value thereof plus a premium of Rs. 1,000 per Option IV Unsecured
NCD, at the end of 78 months from the Deemed Date of Allotment in connection with Unsecured NCD holders
in the Reserved Individual Portion, at the end of 81 months from the Deemed Date of Allotment in connection
with Unsecured NCD holders in the Unreserved Individual Portion, and at the end of 84 months from the
Deemed Date of Allotment in connection with all other Unsecured NCD holders.

In case of Option V Unsecured NCDs, interest would be paid annually at the rate of 10.25% per annum
on the amount outstanding from time to time, commencing from the Deemed Date of Allotment of each
Option V Unsecured NCD. Option V Unsecured NCD holders in the Reserved Individual Portion shall be
entitled to an additional interest rate of 0.75% per annum. Option V Unsecured NCD holders in the Unreserved
Individual Portion shall be entitled to an additional interest rate of 0.50% per annum.

If the date of interest payment falls on a Saturday, Sunday or a public holiday in Mumbai or any other
payment centre notified in terms of the Negotiable Instruments Act, 1881, then interest would be paid on
the next working day. Payment of interest would be subject to the deduction as prescribed in the I.T. Act
or any statutory modification or re-enactment thereof for the time being in force.

As per clause (ix) of Section 193 of the IT. Act, no tax is required to be withheld on any interest payable on any
security issued by a company, where such security is in dematerialized form and is listed on a recognized stock
exchange in India in accordance with the Securities Contracts (Regulation) Act, 1956 (42 of 1956) and the rules

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 made thereunder. Accordingly, no tax will be deducted at source from the interest on listed Unsecured NCD
held in dematerialised form.

However in case of Unsecured NCDs held in physical form, as per the current provisions of the IT Act,
tax will not be deducted at source from interest payable on Unsecured NCDs held by the investor (in case
of resident individual Unsecured NCD holders), if such interest does not exceed Rs.2,500 in any financial
year. If interest exceeds the prescribed limit of Rs.2,500 on account of interest on Unsecured NCDs, then
the tax will be deducted at applicable rate. However in case of Unsecured NCD holders claiming non-
deduction or lower deduction of tax at source, as the case may be, the Unsecured NCD holder should
furnish either (a) a declaration (in duplicate) in the prescribed form i.e. (i) Form 15H which can be given
by individuals who are of the age of 65 years or more (ii) Form 15G which can be given by all applicants
(other than companies, firms and NR), or (b) a certificate, from the Assessing Officer which can be
obtained by all applicants (including companies and firms) by making an application in the prescribed
form i.e. Form No.13. The aforesaid documents, as may be applicable, should be submitted to the
Company quoting the name of the sole/ first Unsecured NCD holder, Unsecured NCD folio number and
the distinctive number(s) of the Unsecured NCD held, prior to the record date to ensure non-
deduction/lower deduction of tax at source from interest on Unsecured NCD. The investors need to
submit Form 15H/ 15G/certificate in original from Assessing Officer for each financial year during the
currency of Unsecured NCD to ensure non-deduction or lower deduction of tax at source from interest on
Unsecured NCD.

B. Payment of Interest

Annual Payment of Interest

For Unsecured NCDs subscribed under Option V, interest of 10.25%* per annum will be paid on the first
day of April every year. The first interest payment will be made on April 1, 2011 for the period
commencing from the Deemed Date of Allotment till March 31, 2011. The last interest payment will be
made at the time of redemption of the Option V Unsecured NCD on a pro rata basis.

* Option V Unsecured NCD holders in the Reserved Individual Portion shall be entitled to an additional interest
rate of 0.75% per annum. Option V Unsecured NCD holders in the Unreserved Individual Portion shall be
entitled to an additional interest rate of 0.50% per annum.

C. Payment of Interest to Option V Unsecured NCD Holders

Payment of Interest will be made to those Option V Unsecured NCD holders whose names appear in the
register of NCD holders (or to first holder in case of joint-holders) as on record date.

We may enter into an arrangement with one or more banks in one or more cities for direct credit of interest
to the account of the investors. In such cases, interest, on the interest payment date, would be directly
credited to the account of those investors who have given their bank mandate.

We may offer the facility of NECS, NEFT, RTGS, Direct Credit and any other method permitted by RBI
and SEBI from time to time to help Unsecured NCD holders. The terms of this facility (including towns
where this facility would be available) would be as prescribed by RBI. Refer to the paragraph on “Manner
of Payment of Interest/Refund/Redemption” appearing in this Prospectus.

Tax exemption certificate/document, if any, must be lodged at the office of the Registrar at least 7(seven)
days prior to the record date or as specifically required, failing which tax applicable on interest will be
deducted at source on accrual thereof in our Company’s books and/or on payment thereof, in accordance
with the provisions of the IT Act and/or any other statutory modification, enactment or notification as the
case may be. A tax deduction certificate will be issued for the amount of tax so deducted.

Maturity and Redemption

The Unsecured NCDs issued pursuant to the Prospectus have a fixed maturity date. The date of maturity for
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Unsecured NCDs subscribed under Option IV is 78 months from the Deemed Date of Allotment in connection with
Unsecured NCD holders in the Reserved Individual Portion, 81 months from the Deemed Date of Allotment in
connection with Unsecured NCD holders in the Unreserved Individual Portion, and 84 months from the Deemed Date of
Allotment in connection with all other Unsecured NCD holders, respectively, and the date of maturity for Unsecured
NCDs subscribed under Option V is 84 months from the Deemed Date of Allotment.

Deemed Date of Allotment

Deemed date of allotment shall be the date of issue of the Allotment Advice / regret.

Application Size

Each application should be for a minimum of 10 NCDs and multiples of 1 NCD thereof. The minimum application size
for each application for NCDs would be Rs. 10,000/- (for all options of Secured NCDs and Unsecured NCDS, namely,
Option I, Option II, Option III, Option IV and Option V NCDs either taken individually or collectively) and in multiples
of Rs. 1,000/- thereafter.

Applicants can apply for any or all options of Secured NCDs and/or Unsecured NCDs offered hereunder (any/all
options) using the same Application Form.

Applicants are advised to ensure that applications made by them do not exceed the investment limits or maximum
number of Unsecured NCDs that can be held by them under applicable statutory and or regulatory provisions.

Terms of Payment

The entire issue price of Rs. 1,000 per Unsecured NCD is payable on application itself. In case of allotment of
lesser number of Unsecured NCDs than the number of Unsecured NCDs applied for, our Company shall refund the
excess amount paid on application to the applicant in accordance with the terms of this Prospectus. For further
details please refer to the paragraph on “Interest on Application Money” beginning on page 186 of this Prospectus.

Record Date

The record date for payment of interest in connection with the Unsecured NCDs or repayment of principal in
connection therewith shall be 15 (fifteen) days prior to the date on which interest is due and payable, or the date of
redemption or early redemption or as prescribed by the NSE.

Manner of Payment of Interest / Refund / Redemption

The manner of payment of interest / refund / redemption in connection with Unsecured NCDs is set out below:

For Unsecured NCDs applied / held in electronic form:

The bank details will be obtained from the Depositories for payment of Interest / refund / redemption as the case
may be. Applicants who have applied for or are holding the Unsecured NCDs in electronic form, 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 the applicant at the applicant’s sole risk, and
neither the Lead Managers, Co-Lead Manager, nor our Company or the Registrars shall have any responsibility and
undertake any liability for the same.

For Unsecured NCDs held in physical form:

The bank details will be obtained from the Registrar to the Issue for payment of interest / refund / redemption as
the case may be.

The mode of interest / refund / redemption payments shall be undertaken in the following order of preference:

1. Direct Credit
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Investors having their bank account with the Refund Banks, shall be eligible to receive refunds, if any, through direct
credit. The refund amount, if any, would be credited directly to their bank account with the Refund Banker.

2. NECS

Payment of interest / refund / redemption shall be undertaken through NECS for applicants having an account at
the centers mentioned in NECS MICR list which has over 36,600 branches.

This mode of payment of refunds would be subject to availability of complete bank account details including the
MICR code as appearing on a cheque leaf, from the Depositories. One of the methods for payment of interest
payment / refund / redemption is through NECS for applicants having a bank account at any of the abovementioned
centers.

3. RTGS

Applicants having a bank account with a participating bank and whose interest payment / refund / redemption
amount exceeds Rs.1 lacs, or such amount as may be fixed by RBI from time to time, have the option to receive
refund through RTGS. Such eligible applicants who indicate their preference to receive interest payment / refund
/ redemption through RTGS are required to provide the IFSC code in the Application Form or intimate our
Company and the Registrars to the Issue at least 7 (seven) days before the record date. Charges, if any, levied by the
applicant’s bank receiving the credit would be borne by the applicant. In the event the same is not provided,
interest payment / refund / redemption shall be made through NECS subject to availability of complete bank
account details for the same as stated above.

3. NEFT

Payment of interest / refund / redemption shall be undertaken through NEFT wherever the applicants’ bank has
been assigned the Indian Financial System Code (“IFSC”), which can be linked to a Magnetic Ink Character
Recognition (“MICR”), if any, available to that particular bank branch. IFSC Code will be obtained from the
website of RBI as on a date immediately prior to the date of payment of refund, duly mapped with MICR
numbers. Wherever the applicants have registered their nine digit MICR number and their bank account number
while opening and operating the de-mat account, the same will be duly mapped with the IFSC Code of that
particular bank branch and the payment of interest/refund/redemption will be made to the applicants through this
method.

4. Registered Post/Speed Post

For all other applicants, including those who have not updated their bank particulars with the MICR code, the interest
payment / refund / redemption orders shall be dispatched under certificate of posting for value up to Rs. 1,500/- and
through Speed Post/ Registered Post for refund orders /interest payment/redemption orders of Rs. 1,500/- and
above.

Please note that applicants are eligible to receive payments through the modes detailed in (1), (2) (3), and (4) herein
above provided they provide necessary information for the above modes and where such payment facilities are allowed
/ available.

Please note that our Company shall not be responsible to the holder of Unsecured NCD, for any delay in receiving
credit of interest / refund / redemption so long as our Company has initiated the process of such request in time.

Printing of Bank Particulars on Interest Warrants

As a matter of precaution against possible fraudulent encashment of refund orders and interest/redemption warrants
due to loss or misplacement, the particulars of the applicant’s bank account are mandatorily required to be given
for printing on the orders/ warrants. In relation to Unsecured NCDs applied and held in dematerialized form, these
particulars would be taken directly from the depositories. In case of Unsecured NCDs held in physical form either
on account of rematerialisation or transfer, the investors are advised to submit their bank account details with our
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Company / Registrar at least 7 (seven) days prior to the record date failing which the orders / warrants will be
dispatched to the postal address of the holder of the Unsecured NCD as available in the records of our Company.

Bank account particulars will be printed on the orders/ warrants which can then be deposited only in the account
specified.

Loan against Unsecured NCDs

Our Company, at its sole discretion, subject to other applicable statutory and/or regulatory requirements, may
consider granting of a loan facility to the holders of Unsecured NCDs against the security of such Unsecured
NCDs. Such loans shall be subject to the terms and conditions as may be decided by our Company from time to
time.

Form and Denomination

In case of Unsecured NCDs held in physical form, a single certificate will be issued to the Unsecured NCD holder
for the aggregate amount (“Consolidated Certificate”) for each type of Unsecured NCDs. The applicant can also
request for the issue of Unsecured NCD certificates in denomination of one Unsecured NCD (“Market Lot”).

In respect of Consolidated Certificates, we will, only upon receipt of a request from the Unsecured NCD
holder, split such Consolidated Certificates into smaller denominations subject to the minimum of Market Lot.
No fees would be charged for splitting of Unsecured NCD certificates in Market Lots, but stamp duty
payable, if any, would be borne by the Unsecured NCD holder. The request for splitting should be
accompanied by the original Unsecured NCD certificate which would then be treated as cancelled by us.

Procedure for Redemption by Unsecured NCD holders

The procedure for redemption is set out below:

Unsecured NCDs held in physical form:

No action would ordinarily be required on the part of the Unsecured NCD holder at the time of redemption and
the redemption proceeds would be paid to those Unsecured NCD holders whose names stand in the register of
Unsecured NCD holders maintained by us on the record date fixed for the purpose of Redemption. However, our
Company may require that the Unsecured NCD certificate(s), duly discharged by the sole holder/all the joint-
holders (signed on the reverse of the Unsecured NCD certificate(s)) be surrendered for redemption on maturity and
should be sent by the Unsecured NCD holder(s) by Registered Post with acknowledgment due or by hand delivery
to our office or to such persons at such addresses as may be notified by us from time to time. Unsecured NCD
holder(s) may be requested to surrender the Unsecured NCD certificate(s) in the manner as stated above, not more
than three months and not less than one month prior to the redemption date so as to facilitate timely payment.

We may at our discretion redeem the Unsecured NCDs without the requirement of surrendering of the Unsecured
NCD certificates by the holder(s) thereof. In case we decide to do so, the holders of Unsecured NCDs need not
submit the Unsecured NCD certificates to us and the redemption proceeds would be paid to those Unsecured NCD
holders whose names stand in the register of Unsecured NCD holders maintained by us on the record date fixed for
the purpose of redemption of Unsecured NCDs. In such case, the Unsecured NCD certificates would be deemed to
have been cancelled. Also see the para “Payment on Redemption” given below.

NCDs held in electronic form:

No action is required on the part of Unsecured NCD holder(s) at the time of redemption of Unsecured NCDs.

Payment on Redemption

The manner of payment of redemption is set out below:

Unsecured NCDs held in physical form:

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The payment on redemption of the Unsecured NCDs will be made by way of cheque/pay order/ electronic modes.
However, if our Company so requires, the aforementioned payment would only be made on the surrender of
Unsecured NCD certificate(s), duly discharged by the sole holder / all the joint-holders (signed on the reverse of
the Unsecured Unsecured NCD certificate(s)). Despatch of cheques/pay order, etc. in respect of such payment will
be made on the Redemption Date or (if so requested by our Company in this regard) within a period of 30 days
from the date of receipt of the duly discharged Unsecured NCD certificate.

In case we decide to do so, the redemption proceeds in the manner stated above would be paid on the Redemption
Date to those Unsecured NCD holders whose names stand in the register of Unsecured NCD holders maintained by
us on the record date fixed for the purpose of Redemption. Hence the transferees, if any, should ensure lodgement of
the transfer documents with us at least 7 (seven) days prior to the record date. In case the transfer documents are not
lodged with us at least 7 (seven) days prior to the record date and we despatch the redemption proceeds to the
transferor, claims in respect of the redemption proceeds should be settled amongst the parties inter se and no
claim or action shall lie against us or the Registrars.

Our liability to Unsecured NCD holder(s) towards his/their rights including for payment or otherwise shall stand
extinguished from the date of early redemption (in case of an exercise of the put/call option)/ redemption in all
events and when we despatch the redemption amounts to the Unsecured NCD holder(s).

Further, we will not be liable to pay any interest, income or compensation of any kind from the date of redemption
of the Unsecured NCD(s).

Unsecured NCDs held in electronic form:

On the redemption date, or the date of early redemption (in case of an exercise of the put/call option), redemption
proceeds would be paid by cheque /pay order / electronic mode to those Unsecured NCD holders whose names
appear on the list of beneficial owners given by the Depositories to us. These names would be as per the
Depositories’ records on the record date fixed for the purpose of redemption. These Unsecured NCDs will be
simultaneously extinguished to the extent of the amount redeemed through appropriate debit corporate action upon
redemption of the corresponding value of the Unsecured NCDs. It may be noted that in the entire process
mentioned above, no action is required on the part of Unsecured NCD holders.

Our liability to Unsecured NCD holder(s) towards his/their rights including for payment or otherwise shall stand
extinguished from the date of early redemption (in case of an exercise of the put/call option)/ redemption in all
events and when we despatch the redemption amounts to the Unsecured NCD holder(s).

Further, we will not be liable to pay any interest, income or compensation of any kind from the date of redemption
of the Unsecured NCD(s).

Redemption Date

Option IV Unsecured NCDs will be redeemed at the expiry of 78 months from the Deemed Date of Allotment in
connection with Unsecured NCD holders in the Reserved Individual Portion, at the expiry of 81 months from the
Deemed Date of Allotment in connection with Unsecured NCD holders in the Unreserved Individual Portion, and at the
expiry of 84 months from the Deemed Date of Allotment in connection with all other Unsecured NCD holders, from the
Deemed Date of Allotment.

Option V Unsecured NCDs will be redeemed at the expiry of 84 months from the Deemed Date of Allotment.

Put / Call Option

The holders of Unsecured NCDs shall not be entitled to exercise any Put Option in connection with such Unsecured
NCDs held by them. Our Company shall not be entitled to exercise any Call Option in connection with any Unsecured
NCDs.

Right to Reissue Unsecured NCD(s)

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Subject to the provisions of the Act, where we have fully redeemed any Unsecured NCD(s), we shall have and shall
be deemed always to have had the right to keep such Unsecured NCDs in effect without extinguishment thereof, for
the purpose of resale or reissue and in exercising such right, we shall have and be deemed always to have had the
power to resell or reissue such Unsecured NCDs either by reselling or reissuing the same Unsecured NCDs or by
issuing other Unsecured NCDs in their place. The aforementioned right includes the right to reissue original
Unsecured NCDs.

Transfer/Transmission of Unsecured NCD (s)

The Unsecured NCDs shall be transferred or transmitted freely in accordance with the applicable provisions of
the Act. The provisions relating to transfer and transmission and other related matters in respect of our shares
contained in the Articles and the Act shall apply, mutatis mutandis (to the extent applicable to debentures) to the
Unsecured NCD(s) as well. In respect of the Unsecured NCDs held in physical form, a suitable instrument of
transfer as may be prescribed by the Issuer may be used for the same. The Unsecured NCDs held in
dematerialised form shall be transferred subject to and in accordance with the rules/procedures as prescribed by
NSDL/CDSL and the relevant DPs of the transfer or transferee and any other applicable laws and rules notified
in respect thereof. The transferee(s) should ensure that the transfer formalities are completed prior to the record
date. In the absence of the same, interest will be paid/redemption will be made to the person, whose name
appears in the register of debenture holders maintained by the Depositories. In such cases, claims, if any, by the
transferees would need to be settled with the transferor(s) and not with the Issuer or Registrar.

For Unsecured NCDs held in electronic form:

The normal procedure followed for transfer of securities held in dematerialised form shall be followed for transfer
of these Unsecured NCDs held in electronic form. The seller should give delivery instructions containing details of
the buyer’s DP account to his depository participant.

In case the transferee does not have a DP account, the seller can re-materialise the Unsecured NCDs and thereby
convert his dematerialised holding into physical holding. Thereafter the Unsecured NCDs can be transferred in the
manner as stated above.

In case the buyer of the Unsecured NCDs in physical form wants to hold the Unsecured NCDs in dematerialised
form, he can choose to dematerialise the securities through his DP.

Joint-holders

Where two or more persons are holders of any Unsecured NCD(s), they shall be deemed to hold the same as joint
holders with benefits of survivorship subject to other provisions contained in the Articles.

Sharing of Information

We may, at our option, use on our own, as well as exchange, share or part with any financial or other
information about the Unsecured NCD holders available with us, with our subsidiaries, if any and affiliates and
other banks, financial institutions, credit bureaus, agencies, statutory bodies, as may be required and neither we or
our affiliates nor their agents shall be liable for use of the aforesaid information.

Notices

All notices to the Unsecured NCD holder(s) required to be given by us or the Debenture Trustee will be sent by
post/ courier to the Registered Holders of the Unsecured NCD(s) from time to time.

Issue of Duplicate Unsecured NCD Certificate(s)

If any Unsecured Unsecured NCD certificate(s) is/are mutilated or defaced or the cages for recording transfers of
Unsecured NCDs are fully utilised, the same may be replaced by us against the surrender of such certificate(s).
Provided, where the Unsecured NCD certificate(s) are mutilated or defaced, the same will be replaced as
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aforesaid only if the certificate numbers and the distinctive numbers are legible.

If any Unsecured NCD certificate is destroyed, stolen or lost then upon production of proof thereof to our satisfaction
and upon furnishing such indemnity/security and/or documents as we may deem adequate, duplicate Unsecured NCD
certificate(s) shall be issued.
Security
The Unsecured NCDs shall not be secured, and accordingly our Company will not be required to create security in favour
of the Debenture Trustee for the Unsecured NCD holders on any assets.

Trustees for the Unsecured NCD holders

We have appointed IDBI Trusteeship Services Limited to act as the Debenture Trustees for the Unsecured NCD
holders. We and the Debenture Trustee will execute a Debenture Trust Deed, inter alia, specifying the powers,
authorities and obligations of the Debenture Trustee and us. The Unsecured NCD holder(s) shall, without further act
or deed, be deemed to have irrevocably given their consent to the Debenture Trustee or any of its agents or authorised
officials to do all such acts, deeds, matters and things in respect of or relating to the Unsecured NCDs as the
Debenture Trustee may in its absolute discretion deem necessary or require to be done in the interest of the
Unsecured NCD holder(s). Any payment made by us to the Debenture Trustee on behalf of the Unsecured NCD
holder(s) shall discharge us pro tanto to the Unsecured NCD holder(s).

The Debenture Trustee will protect the interest of the Unsecured NCD holders in the event of default by us in
regard to timely payment of interest and repayment of principal and they will take necessary action at our cost.

Future Borrowings

We will be entitled to borrow/raise loans or avail of financial assistance in whatever form as also to issue
debentures/ Unsecured NCDs/other securities in any manner having such ranking in priority, pari passu or
otherwise, subject to applicable consents, approvals or permissions that may be required under any
statutory/regulatory/contractual requirement, and change the capital structure including the issue of shares of any
class, on such terms and conditions as we may think appropriate, without the consent of, or intimation to, the
Unsecured NCD holders or the Debenture Trustee in this connection.

Interest on Application Money

Interest on application monies received which are used towards allotment of NCDs

Our Company shall pay interest on application money on the amount allotted, subject to deduction of income tax under
the provisions of the Income Tax Act, 1961, as amended, as applicable, to any applicants to whom NCDs are allotted
pursuant to the Issue from the date of realization of the cheque(s)/demand draft(s) or 3 (three) days from the date of
receipt of the application (being the date of presentation of each application as acknowledged by the Bankers to the
Issue) whichever is later upto one day prior to the Deemed Date of Allotment, at the rate of 7.00% per annum.

Our Company has a right to withdraw the Issue at anytime 2 (two) days prior to Issue closing date for receiving subscription
in the Issue. Our Company shall in the event of such withdrwal, subject to receipt of a minimum subscription of 75 % of the
Base Issue, i.e. Rs. 18,750 lacs, allot NCDs to all applicants who have applied for NCDs upto one day prior to the date by
which Company gives notice for withdrawal of Issue. Further our Company shall pay interest on application money
on the amount allotted, subject to deduction of income tax under the provisions of the Income Tax Act, 1961, as
amended, as applicable, to any applicants to whom NCDs are allotted pursuant to the Issue from the date of
realization of the cheque(s)/demand draft(s) or 3 (three) days from the date of receipt of the application (being the
date of presentation of each application as acknowledged by the Bankers to the Issue) whichever is later upto one
day prior to the Deemed Date of Allotment, at the rate of 7.00% per annum. However, it is clarified that in the event
that our Company does not receive a minimum subscription of 75 % of the Base Issue, i.e. Rs. 18,750 lacs our Company
will not allot any NCDs to applicants.

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Our Company may enter into an arrangement with one or more banks in one or more cities for direct credit of
interest to the account of the applicants. Alternatively, the interest warrant will be dispatched along with the
Letter(s) of Allotment at the sole risk of the applicant, to the sole/first applicant.
Interest on application monies received which are liable to be refunded

Our Company shall pay interest on application money which is liable to be refunded to the applicants in accordance
with the provisions of the Debt Regulations and/or the Companies Act, or other applicable statutory and/or
regulatory requirements, subject to deduction of income tax under the provisions of the Income Tax Act, 1961, as
amended, as applicable, from the date of realization of the cheque(s)/demand draft(s) or 3 (three) days from the date
of receipt of the application (being the date of presentation of each application as acknowledged by the Bankers to
the Issue) whichever is later upto one day prior to the Deemed Date of Allotment, at the rate of 2.50% per annum.
Such interest shall be paid along with the monies liable to be refunded. Interest warrant will be dispatched / credited
(in case of electronic payment) along with the Letter(s) of Refund at the sole risk of the applicant, to the sole/first
applicant.

In the event our Company does not receive a minimum subscription of 75 % of the Base Issue, i.e. Rs. 18,750 lacs on the
date of closure of the Issue, our Company shall pay interest on application money which is liable to be refunded to the
applicants in accordance with the provisions of the Debt Regulations and/or the Companies Act, or other applicable
statutory and/or regulatory requirements, subject to deduction of income tax under the provisions of the Income Tax
Act, 1961, as amended, as applicable, from the date of realization of the cheque(s)/demand draft(s) or 3 (three) days
from the date of receipt of the application (being the date of presentation of each application to the Bankers to the
Issue as acknowledged) whichever is later upto one day prior to the date of closure of the Issue or one day prior to
the date on which Company gives notice for withdrawal of Issue, as the case may beat the rate of 2.50% per
annum. Such interest shall be paid along with the monies liable to be refunded.

Provided that, notwithstanding anything contained hereinabove, our Company shall not be liable to pay any interest on
monies liable to be refunded in case of (a) invalid applications or applications liable to be rejected, and/or (b)
applications which are withdrawn by the applicant.

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 ISSUE PROCEDURE

1. How to Apply?

i. Availability of Prospectus and Application Forms

The abridged Prospectus containing the salient features of this Prospectus together with Application Forms and copies of
this Prospectus may be obtained from our Registered Office, Lead Manager(s) to the Issue, the Co-Lead Manager
,Registrar to the Issue and at branches/collection centres of the Bankers to the Issue, as mentioned on the Application
Form.

In addition, Application Forms would also be made available to the stock exchanges where listing of the NCDs are sought
and to brokers, on their request.

We may provide Application Forms for being downloaded at such websites as we may deem fit.

ii. Who can Apply

The following categories of persons are eligible to apply in the Issue:

Category I

• Public Financial Institutions, Statutory Corporations, Commercial Banks, Co-operative Banks and Regional
Rural Banks, which are authorised to invest in the NCDs;
• Provident Funds, Pension Funds, Superannuation Funds and Gratuity Funds, which are authorised to invest in the
NCDs
• Venture Capital funds registered with SEBI;
• Insurance Companies registered with the IRDA
• National Investment Fund; and
• Mutual Funds.

Category II

• Companies, Bodies Corporate and Societies registered under the applicable laws in India and authorised to invest
in NCDs;
• Public/Private Charitable/Religious Trusts which are authorised to invest in the NCDs;
• Scientific and/or Industrial Research Organisations, which are authorised to invest in the NCDs;
• Partnership Firms in the name of the partner; and
• Limited liability partnerships formed and registered under the provisions of the Limited Liability Partnership Act,
2008 (No. 6 of 2009)

Category III*

• Resident Indian individuals; and

• Hindu Undivided Families through the Karta.

* With respect to applications received from Category III applicants, applications by applicants who apply for
NCDs aggregating to a value not more than Rs. 5 Lac, across all series of NCDs irrespective of whether they are Secured
NCDs or Unsecured NCDs, (Option I, Option II, Option III ,Option IV and/or Option V), shall be grouped together,
(“Reserved Individual Portion”) while applications by applicants who apply for NCDs aggregating to a value
exceeding Rs. 5 Lac, across all series of NCDs, irrespective of whether they are Secured NCDs or Unsecured NCDs,
(Option I, Option II, Option III ,Option IV and/or Option V), shall be separately grouped together, (“Unreserved
Individual Portion”)

Note: Participation of any of the aforementioned categories of persons or entities is subject to the applicable statutory
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and/or regulatory requirements in connection with the subscription to Indian securities by such categories of persons or
entities.

Applicants are advised to ensure that applications made by them do not exceed the investment limits or maximum
number of NCDs that can be held by them under applicable statutory and or regulatory provisions.

Applicants are advised to ensure that they have obtained the necessary statutory and/or regulatory
permissions/consents/approvals in connection with applying for, subscribing to, or seeking allotment of NCDs
pursuant to the Issue.

The Lead Managers, the Co-Lead Manager and their respective associates and affiliates are permitted to subscribe in the
Issue.

The information below is given for the benefit of the investors. Our Company, the Lead Managers and the Co-Lead
Manager are not liable for any amendment or modification or changes in applicable laws or regulations, which may occur
after the date of this Prospectus. Investors are advised to ensure that the aggregate number of NCDs applied for does not
exceed the investment limits or maximum number of NCDs that can be held by them under applicable law.

Grouping of Applications and Allocation Ratio

For the purposes of the basis of allotment:

i) Applications received from Category I applicants: Applications received from Category I, shall be
grouped together, (“Institutional Portion”);

ii) Applications received from Category II applicants: Applications received from Category II, shall be
grouped together, (“Non-Institutional Portion”);

iii) Applications received from Category III applicants: Further with respect to applications received from
Category III applicants, applications by applicants who apply for NCDs aggregating to a value not more than
Rs. 5 Lac, across all series of NCDs irrespective of whether they are Secured NCDs or Unsecured NCDs, (Option
I, Option II, Option III ,Option IV and/or Option V), shall be grouped together, (“Reserved Individual
Portion”) while applications by applicants who apply for NCDs aggregating to a value exceeding Rs. 5 Lac,
across all series of NCDs, irrespective of whether they are Secured NCDs or Unsecured NCDs, (Option I, Option
II, Option III Option IV and/or Option V), shall be separately grouped together, (“Unreserved Individual
Portion”). For further details please refer to “Additional Applications” beginning on page 194 of this Prospectus.

For removal of doubt, “Institutional Portion”, Non-Institutional Portion” “Reserved Individual Portion” and
“Unreserved Individual Portion” are individually referred to as “Portion” and collectively referred to as
“Portions”

Applications by Mutual Funds

No mutual fund scheme shall invest more than 15% of its NAV in debt instruments issued by a single Company which
are rated not below investment grade by a credit rating agency authorised to carry out such activity. Such investment
limit may be extended to 20% of the NAV of the scheme with the prior approval of the Board of Trustees and the Board
of Asset Management Company

A separate application can be made in respect of each scheme of an Indian mutual fund registered with SEBI and such
applications shall not be treated as multiple applications. Applications made by the AMCs or custodians of a Mutual
Fund shall clearly indicate the name of the concerned scheme for which application is being made. In case of
Applications made by Mutual Fund registered with SEBI, a certified copy of their SEBI registration certificate must be
submitted with the Application Form. The applications must be also accompanied by certified true copies of (i) SEBI
Registration Certificate and trust deed (ii) resolution authorising investment and containing operating instructions and
(iii) specimen signatures of authorized signatories. Failing this, our Company reserves the right to accept or reject any
Application in whole or in part, in either case, without assigning any reason therefor.

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Application by Scheduled Banks, Co-operative Banks and Regional Rural Banks

Scheduled Banks, Co-operative banks and Regional Rural Banks can apply in this public issue based upon their own
investment limits and approvals. The application must be accompanied by certified true copies of (i) Board Resolution
authorising investments; (ii) Letter of Authorisation. Failing this, our Company reserves the right to accept or reject
any Application in whole or in part, in either case, without assigning any reason therefor.

Application by Insurance Companies

In case of Applications 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 Application Form. The applications must be accompanied by certified copies of (i)
Memorandum and Articles of Association (ii) Power of Attorney (iii) Resolution authorising investment and
containing operating instructions (iv) Specimen signatures of authorized signatories. Failing this, our Company
reserves the right to accept or reject any Application in whole or in part, in either case, without assigning any
reason therefor.

Applications by Trusts

In case of Applications made by trusts, settled under the Indian Trusts Act, 1882, as amended, or any other
statutory and/or regulatory provision governing the settlement of trusts in India, must submit a (i) certified copy of
the registered instrument for creation of such trust, (ii) Power of Attorney, if any, in favour of one or more trustees
thereof, (iii) such other documents evidencing registration thereof under applicable statutory/regulatory
requirements. Further, any trusts applying for NCDs pursuant to the Issue must ensure that (a) they are authorised
under applicable statutory/regulatory requirements and their constitution instrument to hold and invest in
debentures, (b) they have obtained all necessary approvals, consents or other authorisations, which may be required
under applicable statutory and/or regulatory requirements to invest in debentures, and (c) applications made by
them do not exceed the investment limits or maximum number of NCDs that can be held by them under applicable
statutory and or regulatory provisions. Failing this, our Company reserves the right to accept or reject any
Applications in whole or in part, in either case, without assigning any reason therefor.

iii. Applications cannot be made by:

a) Minors without a guardian name;

b) Foreign nationals;
c) Persons resident outside India;
d) Foreign Institutional Investors;
e) Non Resident Indians; and
f) Overseas Corporate Bodies

2. Escrow Mechanism

We shall open Escrow Accounts with one or more Escrow Collection Bank(s) in whose favour the applicants shall make
out the cheque or demand draft in respect of their application. Cheques or demand drafts for the application amount
received from applicants would be deposited in the respective Escrow Account.

Upon creation of security as disclosed in this Prospectus, the Escrow Collection Bank(s) shall transfer the monies from the
Escrow Accounts to a separate bank account as per the terms of the Escrow Agreement, (“Public Issue Account”).
Payments of refund to the applicants shall also be made from the Escrow Accounts/refund account(s) as per the terms of
the Escrow Agreement and this Prospectus.

The Escrow Collection Bank(s) will act in terms of this Prospectus, the Prospectus and the Escrow Agreement. The
Escrow Collection Bank(s) shall not exercise any lien whatsoever over the monies deposited therein. In terms of Debt
Regulations, it is mandatory for the Company to keep the proceeds of the Issue in an escrow account until the documents
for creation of security as stated in this Prospectus are executed.
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3. Filing of the Prospectus with ROC

A copy of this Prospectus shall be filed with the Registrar of Companies, Chennai, Tamil Nadu, in terms of section 56 and
section 60 of the Act.

4. Pre-Issue Advertisement

Our Company will issue a statutory advertisement after filing of this Prospectus with ROC. This advertisement will
contain the information as prescribed under Debt Regulations. Material updates, if any, between the date of filing of this
Prospectus with ROC and the date of release of this statutory advertisement will be included in the statutory
advertisement.

5. General Instructions

Do’s

Check if you are eligible to apply;

Read all the instructions carefully and complete the Application Form;

Ensure that the details about Depository Participant and Beneficiary Account are correct as allotment of
NCDs will be in the dematerialized form only;

Ensure that you mention your PAN allotted under the IT Act

Ensure that the Demographic Details (as defined herein below) are updated, true and correct in all respects.

Ensure that you have obtained all necessary approvals from the relevant statutory and/or regulatory
authorities to apply for, subscribe to and/or seek allotment of NCDs pursuant to the Issue.

Don’ts:

Do not apply for lower than the minimum application size;

Do not pay the application amount in cash;

Do not fill up the Application Form such that the NCDs applied for exceeds the issue size and/or investment
limit or maximum number of NCDs that can be held under the applicable laws or regulations or maximum
amount permissible under the applicable regulations;

Do not submit application accompanied with Stockinvest.

6. Instructions for completing the Application Form

A. Submission of Application Form

Applications to be made in prescribed form only

The forms to be completed in block letters in English

Applications should be in single or joint names and should be applied by Karta in case of HUF

Thumb impressions and signatures other than in English/Hindi/Gujarati/Marathi or any other languages
specified in the 8th Schedule of the Constitution needs to be attested by a Magistrate or Notary Public or a
Special Executive Magistrate under his/her seal.

All Application Forms duly completed together with cheque/bank draft for the amount payable on
application must be delivered before the closing of the subscription list to any of the Bankers to the Public
Issue or collection centre(s)/ agent(s) as may be specified before the closure of the Issue. Applicants at
centres not covered by the branches of collecting banks can send their forms together with a cheque/draft
drawn on/payable at a local bank in Chennai to the Registrar to the Issue by registered post.

No receipt will be issued for the application money. However, Bankers to the Issue and/or their branches
receiving the applications will acknowledge the same.

Every applicant should hold valid Permanent Account Number (PAN) and mention the same in the
Application Form.

All applicants are required to tick the relevant column “Category of Investor” in the Application Form.

ALL APPLICATIONS BY QIBs SHALL BE RECEIVED ONLY BY THE LEAD MANAGERS AND

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 ITS AFFILIATES.

All applicants should apply for one or more type of NCDs and/or one or more option of NCDs in a single Application
Form only.

Our Company would allot Option III NCDs to all valid applications, wherein the applicants have not indicated their
choice of NCDs.

B. Applicant’s Bank Account Details

It is mandatory for all the applicants to have their NCDs allotted in dematerialised form. The Registrars to the
Issue will obtain the applicant’s bank account details from the Depository. The applicant should note that on the
basis of the name of the applicant, Depository Participant’s (DP) name, Depository Participants identification
number and beneficiary account number provided by them in the Application Form, the Registrar to the Issue
will obtain from the applicant’s DP A/c, the applicant’s bank account details. The investors are advised to
ensure that bank account details are updated in their respective DP A/cs as these bank account details would be
printed on the refund order(s), if any. Please note that failure to do so could result in delays in credit of refunds
to applicants at the applicant’s sole risk and neither the LM nor our Company nor the Refund Banker nor the
Registrar shall have any responsibility and undertake any liability for the same.

C. Applicant’s Depository Account Details

IT IS MANDATORY FOR ALL THE APPLICANTS TO HAVE THEIR NCDs IN DEMATERIALISED

FORM. ALL APPLICANTS SHOULD MENTION THEIR DEPOSITORY PARTICIPANT’S NAME,
DEPOSITORY PARTICIPANT IDENTIFICATION NUMBER AND BENEFICIARY ACCOUNT
NUMBER IN THE APPLICATION FORM. INVESTORS MUST ENSURE THAT THE NAME GIVEN
IN THE APPLICATION FORM IS EXACTLY THE SAME AS THE NAME IN WHICH THE
DEPOSITORY ACCOUNT IS HELD. IN CASE THE 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 APPLICATION FORM.

Applicant should note that on the basis of name of the applicant, Depository Participant’s name, Depository
Participant-Identification number and Beneficiary Account Number provided by them in the Application Form,
the Registrar to the Issue will obtain from the Depository, demographic details of the investor such as address,
bank account details for printing on refund orders and occupation (“Demographic Details”). Hence, applicants
should carefully fill in their Depository Account details in the Application Form.

These Demographic Details would be used for all correspondence with the applicants including mailing of the
refund orders/ Allotment Advice and printing of bank particulars on the refund/interest order and the
Demographic Details given by applicant in the Application Form would not be used for these purposes by the
Registrar.

Hence, applicants are advised to update their Demographic Details as provided to their Depository Participants
and ensure that they are true and correct.

By signing the Application Form, the applicant would have deemed to have authorised the depositories to
provide, upon request, to the Registrar to the Issue, the required Demographic Details as available on its
records. Refund Orders/Allotment Advice would be mailed at the address of the applicant as per the
Demographic Details received from the Depositories. Applicant may note that delivery of Refund
Orders/Allotment Advice may get delayed if the same once sent to the address obtained from the Depositories
are returned undelivered. In such an event, the address and other details given by the applicant in the
Application Form would be used only to ensure dispatch of refund orders. Please note that any such delay shall
be at the applicant’s sole risk and neither we nor the LMs or the Registrars shall be liable to compensate the
applicant for any losses caused to the applicant due to any such delay or liable to pay any interest for such delay.

However in case of applications made under power of attorney, our Company in its absolute discretion,
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 reserves the right to permit the holder of Power of Attorney to request the Registrar that for the purpose of
printing particulars on the refund order and mailing of Refund Orders /Allotment Advice, the demographic
details obtained from the Depository of the applicant shall be used.

In case no corresponding record is available with the Depositories that matches all three parameters, namely,
names of the applicants (including the order of names of joint holders), the Depository Participant’s identity
(DP ID) and the beneficiary’s identity, then such applications are liable to be rejected.

D. Applications under Power of Attorney by limited companies, corporate bodies, registered societies etc.

In case of Applications made pursuant to a power of attorney or by limited companies, corporate bodies,
registered societies etc, a certified copy of the power of attorney or the relevant resolution or authority, as the
case may be, along with a certified copy of the Memorandum of Association and Articles of Association
and/or bye laws must be lodged along with the Application Form, failing this, our Company reserves the right
to accept or reject any Application in whole or in part, in either case, without assigning any reason therefor.

E. Permanent Account Number

The applicant or in the case of applications made in joint names, each of the applicant, should mention
his or her Permanent Account Number (PAN) allotted under the IT Act. In accordance with the SEBI
Guidelines, the PAN would be the sole identification number for the participants transacting in the
securities market, irrespective of the amount of transaction. Any Application Form, without the PAN is
liable to be rejected, irrespective of the amount of transaction. It is to be specifically noted that the
applicants should not submit the GIR number instead of the PAN as the Application is liable to be rejected on
this ground.

F. Terms of Payment

The entire issue price for the NCDs is payable on application only. In case of allotment of lesser number of
NCDs than the number applied, our Company shall refund the excess amount paid on application to the
applicant.

G. Payment Instructions for Applicants

In pursuance of Debt Regulations, we shall open Escrow Account with the Escrow Collection Banks(s)
for the collection of the application amount payable upon submission of the Application Form.

Payment may be made by way of cheque/bank draft drawn on any bank, including a co-operative bank
which is situated at and is member or sub-member of the Bankers’ clearing-house located at the place
where the Application Form is submitted, i.e. at designated collection centres. 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. Payment though
stockinvest would also not be allowed as the same has been discontinued by the RBI vide notification No.
DBOD.NO.FSC.BC. 42/24.47.001/2003-04 dated November 5, 2003. Cash/Stockinvest/Money
Orders/Postal Orders will not be accepted. In case payment is effected in contravention of conditions
mentioned herein, the application is liable to be rejected and application money will be refunded and
no interest will be paid thereon. A separate cheque / bank draft must accompany each Application
Form.

All Application Forms received with outstation cheques, post dated cheques, cheques / bank drafts drawn
on banks not participating in the clearing process, Money orders/postal orders,cash, stockinvest shall be
rejected and the collecting bank shall not be responsible for such rejections.

All cheques / bank drafts accompanying the application should be crossed “A/c Payee only” and (a) all
cheques / bank drafts accompanying the applications made by applicants who are must be made payable to
“Escrow Account STFC NCD Public Issue”.

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The Escrow Collection Bank(s) shall transfer the funds from the Escrow Account, as per the terms of the
Escrow Agreement, into a separate bank account after the creation of security as disclosed in this Draft
Prospectus.

8. Submission of Completed Application Forms

All applications duly completed and accompanied by account payee cheques / drafts shall be submitted at the
branches of the Bankers to the Issue (listed in the Application Form) or our Collection Centre(s)/ agent(s) as
may be specified by us before the closure of the Issue. Our collection centre/ agent however, will not accept
payments made in cash. However, Application Forms duly completed together with cheque/bank draft drawn
on/payable at a local bank in Chennai for the amount payable on application may also be sent by Registered
Post to the Registrar to the Issue, so as to reach the Registrar prior to closure of the Issue. Applicants at
centres not covered by the branches of collecting banks can send their Application Forms together with
cheque / draft drawn on / payable at a local bank in Chennai to the Registrar to the Issue by registered post.

No separate receipts shall be issued for the application money. However, Bankers to the Issue at their
designated branches/our Collection Centre(s)/ agent(s) receiving the duly completed Application Forms will
acknowledge the receipt of the applications by stamping and returning the acknowledgment slip to the
applicant.

Applications shall be deemed to have been received by us only when submitted to Bankers to the Issue at
their designated branches or at our Collection Centre/ agent or on receipt by the Registrar as detailed above
and not otherwise.

All applications by persons or entities belonging to Category I should be made in the form prescribed
for Category I applicants and shall be received only by the Lead Managers, the Co-Lead Manager and
their respective affiliates.

9. On-line Applications

We may decide to offer online application facility for NCDs, as and when it is permitted by law subject to
terms and conditions as may be prescribed.

10. Other Instructions

A. Joint Applications

Applications may be made in single or joint names (not exceeding three). In the case of joint applications, all
payments will be made out in favour of the first applicant. All communications will be addressed to the
first named applicant whose name appears in the Application Form and at the address mentioned
therein.

B. Additional Applications

An applicant is allowed to make one or more applications for the NCDs for the same or other series of NCDs,
subject to a minimum application size of Rs. 10,000/- and in multiples of Rs. 1,000/- thereafter, for each
application. Any application for an amount below the aforesaid minimum application size will be deemed as an
invalid application and shall be rejected. However, multiple applications by the same applicant belonging to
Category III aggregating to a value exceeding Rs. 5 Lac shall be grouped in the Unreserved Individual Portion, for
the purpose of determining the basis of allotment to such applicant. However, any application made by any person in
his individual capacity and an application made by such person in his capacity as a karta of a Hindu Undivided family
and/or as joint applicant, shall not be deemed to be a multiple application.

Two or more applications will be deemed to be multiple applications if the sole or first applicant is one and the same.
For the sake of clarity, two or more applications shall be deemed to be a multiple application for the aforesaid purpose
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 if the PAN number of the sole or the first applicant is one and the same.

C. Depository Arrangements

As per the provisions of Section 68B of the Act, the allotment of NCDs of our Company can be madein a
dematerialised form, (i.e. not in the form of physical certificates but be fungible and be represented by the
Statement issued through electronic mode).

We have made depository arrangements with NSDL and CDSL for issue and holding of the NCDs in
dematerialised form. Please note that tripartite agreements have been executed between the Company, the
Registrar and both the depositories.

As per the provisions of the Depositories Act, 1996, the NCDs issued by us can be held in a dematerialised. In
this context:

i Tripartite Agreement dated March 29, 2000 and April 30, 1999 between us, the Registrar to the Issue and
CDSL and NSDL, respectively for offering depository option to the investors.
ii. An applicant who wishes to apply for NCDs in the electronic form must have at least one beneficiary
account with any of the Depository Participants (DPs) of NSDL or CDSL prior to making the application.
iii. The applicant seeking allotment of NCDs in the Electronic Form must necessarily fill in the details
(including the beneficiary account number and DP’s ID) appearing in the Application Form under the
heading ‘Request for NCDs in Electronic Form’.
iv. NCDs allotted to an applicant in the Electronic Account Form will be credited directly to the applicant’s
respective beneficiary account(s) with the DP.
v. For subscription in electronic form, names in the Application 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.
vi. Non-transferable Allotment Advice/refund orders will be directly sent to the applicant by the Registrars to
this Issue.
vii. If incomplete/incorrect details are given under the heading ‘Request for NCDs in electronic form’ in the
Application Form, it will be deemed to be an application for NCDs in physical form and thus will be
rejected.
viii. For allotment of NCDs in electronic form, the address, nomination details and other details of the applicant
as registered with his/her DP shall be used for all correspondence with the applicant. The applicant is therefore
responsible for the correctness of his/her demographic details given in the Application Form vis-à-vis those
with his/her DP. In case the information is incorrect or insufficient, the Company would not be liable for
losses, if any.
ix. It may be noted that NCDs in electronic form can be traded only on the Stock Exchanges having electronic
connectivity with NSDL or CDSL. NSE has connectivity with NSDL and CDSL.
x. Interest or other benefits with respect to the NCDs held in dematerialised form would be paid to those
NCD holders whose names appear on the list of beneficial owners given by the Depositories to us as on
record date. In case of those NCDs for which the beneficial owner is not identified by the Depository as on
the record date/ book closure date, we would keep in abeyance the payment of interest or other benefits, till
such time that the beneficial owner is identified by the Depository and conveyed to us, whereupon the
interest or benefits will be paid to the beneficiaries, as identified, within a period of 30 days.
xi. The trading of the NCDs shall be in dematerialized form only.

D. Communications

• All future Communications in connection with Applications made in the Issue should be addressed to the
Registrar to the Issue quoting all relevant details as regards the applicant and its application.

• Applicants can contact the Compliance Officer of the Company/Lead Managers/ Co-Lead Manager or the
Registrar to the Issue in case of any Pre-Issue related problems. In case of Post-Issue related problems such as
non-receipt of Allotment Advice / credit of NCDs in depository’s beneficiary account / refund orders, etc.,
applicants may contact the Compliance Officer of the Company/Lead Manager/ Co-Lead Manager or Registrar
to the Issue.
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11. Rejection of Application

The Board of Directors and/or any committee of our Company reserves its full, unqualified and absolute right to
accept or reject any application in whole or in part and in either case without assigning any reason thereof.

Application may be rejected on one or more technical grounds, including but not restricted to:

Applications not duly signed by the sole/joint applicants;

Amount paid doesn’t tally with the amount payable for the NCDs applied for;

Age of First applicant not given;

Application by persons not competent to contract under the Indian Contract Act, 1872 including minors (without
the name of guardian) and insane persons;

PAN not mentioned in the Application Form;

GIR number furnished instead of PAN;

Applications for amounts greater than the maximum permissible amounts prescribed by applicable regulations;

Applications by any persons outside India;

Any application for an amount below the minimum application size;

Application for number of NCDs, which are not in multiples of one;

Category not ticked;

Application under power of attorney or by limited companies, corporate, trust etc., where relevant documents are
not submitted;

Application Form does not have applicant’s depository account details;

Applications accompanied by Stockinvest/money order/postal order;

Signature of sole and/ or joint applicant(s) missing;

Application Forms not delivered by the applicant within the time prescribed as per the Application Form and the
Prospectus and as per the instructions in the Prospectus and the Application Form; or

In case the subscription amount is paid in cash.

In case no corresponding record is available with the Depositories that matches three parameters namely, names
of the applicant, the Depository Participant’s Identity and the beneficiary’s account number.

Application Form accompanied with more than one cheque.

Institutional Investor Applications not procured by the Lead Managers, the Co-Lead Manager or their respective
affiliates.

For further instructions regarding application for the NCDs, investors are requested to read the Application Form

12. Allotment Advice / Refund Orders

The unutilised portion of the application money will be refunded to the applicant by an A/c Payee cheque/demand
draft. In case the at par facility is not available, the Company reserves the right to adopt any other suitable mode of
payment.

The Company shall credit the allotted NCDs to the respective beneficiary accounts/despatch the Letter(s) of
Allotment or Letter(s) of Regret/Refund Orders in excess of Rs.1,500/-, as the case may be, by Registered Post/Speed
Post at the applicant’s sole risk, within 30 days from the date of closure of the Issue. Refund Orders up to Rs. 1,500/-
will be sent under certificate of posting. We may enter into an arrangement with one or more banks in one or more
cities for refund to the account of the applicants through Direct Credit/RTGS/NEFT.

Further,

a) Allotment of NCDs offered to the public shall be made within a time period of 30 days from the date of
closure of the Issue;
b) Credit to de-mat account will be given within 2 working days from the date of allotment
c) Interest @15 per cent per annum will be paid if the allotment has not been made and/or the Refund Orders
have not been dispatched to the applicants within 30 days from the date of the closure of the Issue, for the
delay beyond 30 days.

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

13. Retention of oversubscription

The Company is making a public Issue of secured NCDs aggregating upto Rs. 25,000 lacs with an option to
retain oversubscription of NCDs up to Rs 25,000 lacs, including a reservation for Unsecured NCDs
aggregating upto Rs. 20,000 lacs. The Unsecured NCDs will be in the nature of subordinated debt and will be
eligible for Tier II capital.

Our Company shall be entitled to issue and allot Unsecured NCDs, subject to demand, aggregating upto the Issue
Size i.e. upto Rs. 50,000 lacs, in case of a shortfall in demand for Secured NCDs.

Alternatively, our Company shall be entitled to issue and allot Secured NCDs, subject to demand, aggregating upto
the Issue Size i.e. upto Rs. 50,000 lacs, in case of a shortfall in demand for Unsecured NCDs.

14. Basis of Allotment

Grouping of Applications and Allocation Ratio: Applications received from various applicants shall be grouped
together on the following basis:

i) Applications received from Category I applicants: Applications received from Category I, shall be
grouped together, (“Institutional Portion”);

ii) Applications received from Category II applicants: Applications received from Category II, shall be
grouped together, (“Non-Institutional Portion”);

iii) Applications received from Category III applicants: Further with respect to applications received from
Category III applicants, applications by applicants who apply for NCDs aggregating to a value not more than
Rs. 5 Lac, across all series of NCDs irrespective of whether they are Secured NCDs or Unsecured NCDs, (Option
I, Option II, Option III , Option IV and Option V), shall be grouped together, (“Reserved Individual Portion”)
while applications by applicants who apply for NCDs aggregating to a value exceeding Rs. 5 Lac, across all
series of NCDs, irrespective of whether they are Secured NCDs or Unsecured NCDs, (Option I, Option II, Option
III , Option IV and Option V), shall be separately grouped together, (“Unreserved Individual Portion”). For
further details please refer to “Additional Applications” beginning on page 194 of this Prospectus.

For removal of doubt, “Institutional Portion”, Non-Institutional Portion” “Reserved Individual Portion”
and “Unreserved Individual Portion” are individually referred to as “Portion” and collectively referred to
as “Portions”

Basis of Allotment for NCDs

(a) Allotments in the first instance:

(i) Applicants belonging to the Institutional Portion, in the first instance, will be allocated NCDs
upto 10% of aggregate face value of all NCDs available for allotment on first come first serve
basis (determined on the basis of date of receipt of each application duly acknowledged by the
Bankers to the Issue);

(ii) Applicants belonging to the Non-Institutional Portion, in the first instance, will be allocated
NCDs upto 10% of aggregate face value of all NCDs available for allotment on first come first
serve basis (determined on the basis of date of receipt of each application duly acknowledged by
the Bankers to the Issue);

(iii) Applicants belonging to the Reserved Individual portion shall be given preferential allotment of
NCDs upto 40% of aggregate face value of all NCDs available for allotment on first come first
serve basis (determined on the basis of date of receipt of each application duly acknowledged by
the Bankers to the Issue);
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 (iv) Thereafter the remaining 40% of the aggregate face value of all NCDs shall in the first instance
be available for allotment on first come first serve basis (determined on the basis of date of
receipt of each application duly acknowledged by the Bankers to the Issue) to applicants
belonging to the Reserved Individual Portion and the Unreserved Individual Portion, out of
which the allotments shall be made in connection with all other applications by applicants
belonging to Category III (including applicants belonging to the Reserved Individual Portion),
who have not received allotments under (iii) above.

Our Company shall be entitled to issue and allot Unsecured NCDs, subject to demand,
aggregating upto the Issue Size i.e. upto Rs. 50,000 lacs, in case of a shortfall in demand for
Secured NCDs.

Illustrations:

• In case of NIL demand for Unsecured NCD, our Company shall be entitled to issue Secured NCDs
aggregating upto Rs. 50,000 lacs, provided that our Company recieves adequate demand for such
Secured NCDs.

• In case our Company receives a demand for Unsecured NCDs aggregating to Rs. 10,000 lacs, our
Company shall be entitled to issue Secured NCDs aggregating upto Rs. 40,000 lacs, provided that our
Company recieves adequate demand for such Secured NCDs.

Our Company shall be entitled to issue and allot Secured NCDs, subject to demand, aggregating
upto the Issue Size i.e. upto Rs. 50,000 lacs, in case of a shortfall in demand for Unsecured NCDs.

Illustrations:

• In case of NIL demand for Secured NCDs, our Company shall be entitled to issue Unsecured NCDs
aggregating upto Rs. 50,000 lacs, provided that our Company recieves adequate demand for such
Unsecured NCDs.

• In case our Company receives a demand for Secured NCDs aggregating to Rs. 10,000 lacs, our
Company shall be entitled to issue Unsecured NCDs aggregating upto Rs. 40,000 lacs, provided that
our Company recieves adequate demand for such Unsecured NCDs.

Allotments, in consultation with the Designated Stock Exchange, shall be made on a first-come first-serve
basis, based on the date of presentation of each application to the Bankers to the Issue, in each Portion
subject to the Allocation Ratio.

(b) Under Subscription: Under subscription, if any, in Reserved Individual Portion or Unreserved Individual
Portion shall first be met by inter-se adjustment between these two sub-categories. Thereafter, if there is
any under subscription in any Portion, priority in allotments will be given to the Category III applicants
and balance, if any, shall be first made to applicants of the Non-Institutional Portion (Category II), and
thereafter to Institutional Portion (Category I) on a first come first serve basis, on proportionate basis.

(c) All applications received on the same day by the Bankers to the Issue would be treated at par with each
other. Allotment within a day would be on proportionate basis, where NCDs applied for exceeds NCDs to
be allotted.

(d) Minimum allotments of 1NCD and in multiples of 1 NCD thereafter would be made in case of each valid
application.

(e) Proportionate Allotments: In all proportionate allotments that are less then 1 NCD per application,
successful applicants shall be determined by draw of lots in such manner that allotment to each
application is not less then 1 NCD and in multiple of 1 NCD thereafter.

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(f) Allotments in case of oversubscription: In case of an oversubscription, allotments to the maximum extent,
as possible, will be made on a first-come first-serve basis and thereafter on proportionate basis.

(g) Applicant applying for more than one series of NCDs: If an applicant has applied for more than one series
of NCDs, (Option I, Option II, Option III, Option IV and/or Option V, individually referred to as “Series”),
and in case such applicant is entitled to allocation of only a part of the aggregate number of NCDs applied
for, the Series-wise allocation of NCDs to such applicants shall be in proportion to the number of NCDs
with respect to each Series, applied for by such applicant, subject to rounding off to the nearest integer, as
appropriate in consultation with Lead Managers, the Co-Lead Manager and Designated Stock Exchange.

The aforementioned basis of allotment shall be followed separately for the Secured NCDs and Unsecured
NCDs.

All decisions pertaining to the basis of allotment of NCDs pursuant to the Issue shall be taken by our
Company in consultation with the Lead Managers, the Co-Lead Manager and the Designated Stock Exchange
and in compliance with the aforementioned provisions of this Prospectus.

Our Company would allot Option III Secured NCDs to all valid applications, wherein the applicants have
selected only Secured NCDs, but have not indicated their choice of the relevant Series of Secured NCDs
(Option I, Option II or Option III).

Our Company would allot Option IV Unsecured NCDs to all valid applications, wherein the applicants have
selected only Unsecured NCDs, but have not indicated their choice of the relevant Series of Unsecured NCDs
(Option IVor Option V).

Our Company would allot Option III Secured NCDs to all valid applications, wherein the applicants have
neither selected Secured NCDs nor Unsecured NCDs.

15. Investor Withdrawals and Pre-closure

Investor Withdrawal: Applicants are allowed to withdraw their applications at any time prior to the closure of the
Issue.

Pre-closure: Our Company, in consultation with the Lead Managers and Co-Lead Manager reserve the right to close
the Issue at any time prior to the Closing Date, subject to receipt of minimum subscription for NCDs aggregating to
75% of the Base Issue. Our Company shall allot NCDs with respect to the applications received at the time of such
pre-closure in accordance with the Basis of Allotment as described hereinabove and subject to applicable statutory
and/or regulatory requirements.

16. Utilisation of Application Money

The sum received in respect of the Issue will be kept in separate bank accounts and we will have access to such
funds as per applicable provisions of law(s), regulations and approvals.

17. Utilisation of Issue Proceeds

a) All monies received pursuant to the Issue of NCDs to public shall be transferred to a separate bank
account other than the bank account referred to in sub-section (3) of section 73 of the Act.

b) Details of all monies utilised out of Issue referred to in sub-item (a) shall be disclosed under an
appropriate separate head in our Balance Sheet indicating the purpose for which such monies had been
utilised; and

c) Details of all unutilised monies out of issue of NCDs, if any, referred to in sub-item (a) shall be
disclosed under an appropriate separate head in our Balance Sheet indicating the form in which such
unutilised monies have been invested.

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d) We shall utilize the Issue proceeds only upon creation of security as stated in this Prospectus and on receipt of
the minimum subscription of 75% of the Base Issue.

e) The Issue proceeds shall not be utilized towards full or part consideration for the purchase or any other
acquisition, inter alia by way of a lease, of any property.

Listing

Application has been made to the NSE for permission to deal in and for an official quotation of our NCDs. NSE has been
appointed as the Designated Stock Exchange.

If permissions to deal in and for an official quotation of our NCDs are not granted by NSE, our Company will forthwith
repay, without interest, all moneys received from the applicants in pursuance of this Prospectus.

Our Company shall ensure that all steps for the completion of the necessary formalities for listing and commencement of
trading at NSE are taken within 7 working days from the date of allotment.

For the avoidance of doubt, it is hereby clarified that in the event of non subscription to any one or more of the Options,
such NCDs with Option(s) shall not be listed.

Upon the part redemption of the Option III Secured NCDs at the end of 36 months and 48 months from the Deemed Date
of Allotment, respectively, in accordance with the aforementioned provisions of this Prospectus, trading in such Option
III Secured NCDs, will be suspended till the required approval(s) and/or permission(s) for trading in the Option III
Secured NCDs (with respect to the outstanding value of Option III Secured NCDs) is obtained from the stock exchanges
and/or other regulatory authorities, in accordance with the applicable statutory and/or regulatory requirements.

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 SECTION VII : LEGAL AND OTHER INFORMATION

PENDING PROCEEDINGS AND STATUTORY DEFAULTS

As on the date of this Prospectus, there are no defaults in meeting statutory dues, institutional dues, and towards holders
of instrument like debentures, fixed deposits and arrears on cumulative preference shares, etc, by our Company or by
public companies promoted by the same promoter and listed on stock exchange.

Save as disclosed hereinbelow, there are no pending proceedings pertaining to:

a. matters likely to affect operation and finances of our Company including disputed tax liabilities of any nature; and

b. criminal prosecution launched against our Company and the Directors for alleged offences under the enactments
specified in Paragraph 1 of Part I of Schedule XIII to the Act.

1. The State of Gujarat and the Inspector of Money Lenders, Gujarat have initiated criminal proceedings against
our Company and our Managing Director, Mr. R. Sridhar, in connection with alleged contraventions of the
Bombay Money Lenders Act, 1946, (“Money Lenders Act”), (Criminal Case No. 289 of 2008), before the
Metropolitan Magistrate, Ahmedabad. The complainants have inter alia alleged in their pleadings that we have
conducted the business of money lending without obtaining a license under the Money Lenders Act, and have
allegedly violated other related provisions thereof. Accordingly, the complainants have sought to prosecute and
penalize our Company and our managing director under Section 34 of the Money Lenders Act.

We filed an application under Section 482 of the Code of Criminal Procedure, 1973 against the State of Gujarat
and the Inspector of Money Lenders, Gujarat, before the High Court of Gujarat at Ahmedabad, (“Quashing
Application”), seeking to quash the Criminal Proceedings, and to stay the Criminal Proceedings during the
pendency of the Quashing Application.

These proceedings initiated against our Company and our managing director, and the application filed by our
Company are pending hearing and final disposal.

2. Our Company has filed an appeal before the Hon’ble Supreme Court of India (Special Leave Petition (Civil)
35142 of 2009) against an order dated November 18, 2009 passed by the Hon’ble High Court of Kerala in
connection with a writ petiton filed by our Company challenging the action of Commissioner of Commercial
Taxes, Kerela directing our Company to register under the provisions of the Kerala Money Lenders Act, 1946,
(“KMLA”). The Hon’ble High Court of Kerela, pursuant to the impugned order, had dismissed an appeal in
connection with the aforesaid writ petition, thereby inter-alia confirming the aforesaid impugned order passed
by the Commissioner of Commercial Taxes, Kerela. The Hon’ble Supreme Court of India has admitted the
aforesaid appeal and pursuant to an order dated December 16, 2009 stayed the operation of the impugned order.
The aforesaid proceedings is pending hearing and final disposal.

3. Our Company has filed a writ petition before the Hon’ble High Court of Andhra Pradesh against the orders
dated March 20, 2009 passed by the Commercial Tax Officer, Tirupati, wherein it has been alleged that our
Company is liable to be assessed to tax under the Andhra Pradesh Value Added Tax Act, 2005 and the Andhra
Pradesh General Sales Tax Act, 1957. Pursuant to the writ petition our Company has also challenged the notices
dated March 21, 2009 issued by the Commercial Tax Officer, Andhra Pradesh proposing to levy interest and
penalty. The Hon’ble High Court of Andhra Pradesh has vide an order dated April 15, 2009 stayed the operation
of the orders passed by the Commercial Tax Officer, Tirupati subject to our Company depositing 1/3rd of the
disputed tax amount within 4 weeks from the date of aforesaid order, which our Company has deposited with
the Hon’ble High Court. The aforesaid petiton is pending hearing and final disposal.

4. Our Company has filed a writ petition vide writ petition no. 7450 of 2010 before the Hon’ble High Court of
Madras dated April 5, 2010 against Union of India represented by its secretary and the Chairman of Central

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Board of Direct Taxes seeking an order for the stay on the operation of the section 206AA of the Income Tax
Act, 1961 (‘IT Act’) introduced by the Finance Act 02/2009 which inter alia provides that any person entitled
to receive any sum or income or amount, on which income tax is deductible under Chapter XVIIB of the IT Act
shall furnish his permanent account number to the person responsible for deducting such tax with effect from
April 01, 2010 till the disposal of the aforesaid writ petition. Since our Company is a non banking financial
institution, most of its constituents are depositors or debenture holders of small amounts and hence may not be
assessable to income tax. The consequence and effect of the aforesaid provision is that even persons who
hitherto are not subjected to the difficulties of securing the permanent account number when they do not have
any assessable income are now compelled to obtain a permanent account number and produce the same before
tax deductors which may cause inconvenience to the depositors or debenture holders of small amounts and in
turn affects the business of our Company.

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 OTHER REGULATORY AND STATUTORY DISCLOSURES

Authority for the Issue

At the meeting of the committee duly authorised by the Board of Directors of the Company, held on April 16, 2010 the
said committee approved the issue of NCDs to the public upto an amount not exceeding Rs. 50,000 lac.

Prohibition by SEBI

Our Company, persons in control of our Company and/or our Promoter have not been restrained, prohibited or debarred
by SEBI from accessing the securities market or dealing in securities and no such order or direction is in force. Further,
no member of our promoter group has been prohibited or debarred by SEBI from accessing the securities market or
dealing in securities due to fraud.

Disclaimer Clause of the NSE

AS REQUIRED, A COPY OF THIS OFFER DOCUMENT HAS BEEN SUBMITTED TO

NATIONAL STOCK EXCHANGE OF INDIA LIMITED (HEREINAFTER REFERRED TO
AS NSE). NSE HAS GIVEN VIDE ITS LETTER REF.:NSE/LIST/136668-T DATED APRIL
30, 2010 PERMISSION TO THE ISSUER TO USE THE EXCHANGE’S NAME IN THIS
OFFER DOCUMENT AS ONE OF THE STOCK EXCHANGES ON WHICH THIS
ISSUER’S SECURITIES ARE PROPOSED TO BE LISTED. THE EXCHANGE HAS
SCRUTINIZED THIS DRAFT OFFER DOCUMENT FOR ITS LIMITED INTERNAL
PURPOSE OF DECIDING ON THE MATTER OF GRANTING THE AFORESAID
PERMISSION TO THIS ISSUER. IT IS TO BE DISTINCTLY UNDERSTOOD THAT THE
AFORESAID PERMISSION GIVEN BY NSE SHOULD NOT IN ANY WAY BE DEEMED
OR CONSTRUED THAT THE OFFER DOCUMENT 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 OFFER DOCUMENT; NOR DOES IT WARRANT THAT THIS ISSUER’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 THIS ISSUER, ITS PROMOTERS, ITS MANAGEMENT OR
ANY SCHEME OF PROJECT OF THIS ISSUER.

EVERY PERSON WHO DESIRES TO APPLY FOR OR OTHERWISE ACQUIRE ANY

SECURITIES OF THIS ISSUER MAY DO SO PURSUANT TO INDEPENDENT INQUIRY,
INVESTIGATION AND ANALYSIS AND SHALL NOT HAVE ANY CLAIM AGAINST
THE EXCHANGE WHATSOEVER BY REASON OF ANY LOSS WHICH MAY BE
SUFFERED BY SUCH PERSON CONSEQUENT TO OR IN CONNECTION WITH SUCH
SUBSCRIPTION/ ACQUISITION WHETHER BY REASON OF ANYTHING STATED OR
OMITTED TO BE STATED HEREIN OR ANY OTHER REASON WHATSOEVER.”
Disclaimer Clause of the RBI

THE COMPANY IS HAVING A VALID CERTIFICATE OF REGISTRATION DATED APRIL 17, 2007
ISSUED BY THE RESERVE BANK OF INDIA UNDER SECTION 45 IA OF THE RESERVE BANK OF
INDIA ACT, 1934. HOWEVER, THE RBI DOES NOT ACCEPT ANY RESPONSIBILITY OR GUARANTEE
ABOUT THE PRESENT POSITION AS TO THE FINANCIAL SOUNDNESS OF THE COMPANY OR FOR
THE CORRECTNESS OF ANY OF THE STATEMENTS OR REPRESENTATIONS MADE OR OPINIONS
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EXPRESSED BY THE COMPANY AND FOR REPAYMENT OF DEPOSITS/ DISCHARGE OF LIABILITY
BY THE COMPANY.

Listing

An application has been made to the NSE for permission to deal in and for an official quotation of our NCDs. NSE has
been appointed as the Designated Stock Exchange.

If permissions to deal in and for an official quotation of our NCDs are not granted by NSE, our Company will forthwith
repay, without interest, all moneys received from the applicants in pursuance of this Prospectus.

Our Company shall ensure that all steps for the completion of the necessary formalities for listing and commencement of
trading at all the Stock Exchanges mentioned above are taken within 7 working days from the date of allotment.

For the avoidance of doubt, it is hereby clarified that in the event of non subscription to any one or more of the Options,
such NCDs with Option(s) shall not be listed.

Consents

Consents in writing of: (a) the Directors, (b) the Company Secretary and Compliance Officer (c) Bankers to the
Company and Bankers to the Issue; (d) Lead Managers and the Co-Lead Manager, (e) the Registrar to the Issue, (f) Lead
Brokers to the Issue, (g) Legal Advisors to the Issue, (h) Credit Rating Agencies, (i) the Debenture Trustee, and (j) the
Lead Brokers to act in their respective capacities, have been obtained and the same will be filed along with a copy of the
Prospectus with the ROC.

Consents of S.R. Batliboi & Co. and G. D. Apte & Co. the Statutory Auditors/ Joint Auditors of our Company for
inclusion of their names, contact details and examination reports on reformatted unconsolidated and consolidated
summary statements and the statements of tax benefits in the form and context in which they appear in the Prospectus,
have been obtained and the same will be filed along with a copy of the Prospectus with the ROC.

Expert Opinion

Except the reports issued by CARE dated April 19, 2010 and by CRISIL dated April 27, 2010, in respect of the credit
ratings issued thereby for this Issue which furnishes the rationale for its rating, our Company has not obtained any expert
opinions.

Common form of Transfer

The Issuer undertakes that there shall be a common form of transfer for the NCDs and the provisions of the Companies
Act, 1956 and all applicable laws shall be duly complied with in respect of all transfer of debentures and registration
thereof.

Minimum Subscription

If the Company does not receive the minimum subscription of 75% of the Base Issue aggregating to Rs. 25,000 lacs, i.e.
Rs. 18,750 lac, the entire subscription shall be refunded to the applicants within 30 days from the date of closure of the
Issue. If there is delay in the refund of subscription by more than 8 days after the Company becomes liable to pay the
subscription amount, the Company will pay interest for the delayed period, at rates prescribed under sub-sections (2) and
(2A) of Section 73 of the Companies Act, 1956.

Filing of the Draft Prospectus

The Draft Prospectus has been filed with NSE on April 21, 2010, in terms of Regulation 7 of the Debt Regulations for
dissemination on their website(s).

Debenture Redemption Reserve

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Section 117C of the Act states that any company that intends to issue debentures must create a DRR to which adequate
amounts shall be credited out of the profits of the company until the redemption of the debentures. The Ministry of
Corporate Affairs has, through its circular dated April 18, 2002, (“Circular”), specified that the quantum of DRR to be
created before the redemption liability actually arises in normal circumstances should be ‘adequate’ to pay the value of
the debentures plus accrued interest, (if not already paid), till the debentures are redeemed and cancelled. The Circular
however further specifies that, for NBFCs like our Company, (NBFCs which are registered with the RBI under Section
45-IA of the RBI Act), the adequacy of the DRR will be 50% of the value of debentures issued through the public issue.
Accordingly, our Company is required to create a DRR of 50% of the value of debentures issued through the public
issue. As further clarified by the Circular, the amount to be credited as DRR will be carved out of the profits of the
company only and there is no obligation on the part of the company to create DRR if there is no profit for the particular
year. Our Company shall credit adequate amounts of DRR, from its profits every year until such NCDs are redeemed.
The amounts credited to DRR shall not be utilized by the company except for the redemption of the NCDs.

Issue Related Expenses

The expenses of this Issue include, among others, Fees for the Lead Managers and the Co-Lead Manager, printing and
distribution expenses, legal fees, advertisement expenses and listing fees. The estimated Issue expenses to be incurred for
the Issue size of upto Rs. 50,000 lacs (assuming the full subscription including the retention of over subscription of upto
Rs. 25,000 lacs) are as follows:
(Rs. in lacs)
Activity Expenses
Lead Management Fee/ Underwriting Commission 750
Advertising and Marketing Expenses 1,000
Printing and Stationery 75
Fees payable legal advisors to the Issue 22.5
Fess payable to the Registrars to the Issue 10
Fees payable to the Debenture Trustee 12
Others (Brokerage, Credit Rating Fee, Etc.) 150
Total 2,019.50

The above expenses are indicative and are subject to change depending on the actual level of subscription to the Issue
and the number of Allottees, market conditions and other relevant factors.

Underwriting

The Issue has not been underwritten.

Details regarding the public issue during the last three years by the Company and other listed companies under
the same management within the meaning of section 370(1B):

Our Company has not made any public or rights or composite issue of capital during the last three years. There are no
listed companies under the same management within the meaning of Section 370(1)(B) of the Companies Act, 1956.

Public / Rights Issues

Our Company has not made any public or rights issuances in the last five years.

Previous Issue

Pursuant to a prospectus dated July 16, 2009 our Company made a public issue of 99,99,996 secured non convertible
debentures Rs. 1,000.00 lacs.

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Other than as specifically disclosed in this Prospectus, the Company has not issued any securities for consideration other
than cash.

Commissions and Brokerage on previous issue

Rs 1,237.49 lacs was incurred towards commission and brokerage in connection with the public issue of 99,99,996
secured non convertible debentures Rs. 1,000.00 lacs pursuant to the prospectus dated July 16, 2009.

Stock Market Data

A. Our Equity Shares

Our Equity Shares are listed on the NSE, BSE and MSE. However our Equity Shares have not been traded on the MSE
since February 2000.

The high, low and average market prices of the Equity Shares of our Company during the preceding three years:

BSE
Year Date of High Volume on date Date of Low Low Volume on Date Average
High (Rs.) of High (Rs.) of low (Rs.)
(No. of Shares) (No. of Shares)
2007 December 416.05 37,322 April 02, 115.95 6,438 266.00
24, 2007 2007
2008 January 16, 408.45 23,018 December 190.25 27,142 299.35
2008 12, 2008
2009 December 484.90 72,914 March 12, 181.80 1,233 333.35
31, 2009 2009
(Source: www.bseindia.com)

NSE
Year Date of HighVolume on date Date of Low Low Volume on Date Average
High (Rs.) of High (Rs.) of low (Rs.)
(No. of Shares) (No. of Shares)
2007 December 416.95 118,807 April 02, 116.15 28,110 266.55
27, 2007 2007
2008 January 16, 408.05 52,132 December 189.70 137,507 298.88
2008 12, 2008
2009 December 487.9 245,151 April 06, 182.85 102,272 335.38
31, 2009 2009
(Source: www.nseindia.com)

Notes
• High, low and average prices are of the daily closing prices.
• In case of two days with the same closing price, the date with higher volume has been considered.

Monthly high and low prices and trading volumes on the Stock Exchanges for the six months preceding the date of filing
of this Prospectus:

BSE
High Volume (No. Low Volume (No. Average
Month Date Date
(Rs.) of Shares) (Rs.) of Shares) (Rs.)
April 2010 April 30, 2010 564.80 14,71,152 April 1, 2010 524.00 9,188 544.40
March 2010 March 540.70 1,11,865 March 462.30 24,687 501.50
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 BSE
High Volume (No. Low Volume (No. Average
Month Date Date
(Rs.) of Shares) (Rs.) of Shares) (Rs.)
April 2010 April 30, 2010 564.80 14,71,152 April 1, 2010 524.00 9,188 544.40
29,2010 5,2010
February February 34,801
February 2010 517.05 1,04,842 430.95 474.00
3,2010 25,2010
January January
January 2010 515.85 77471 474.15 12,35,964 495.00
18,2010 6.2010
December 31, December1,
December 2009 484.90 72,914 419.00 29,942 451.95
2009 2009
November 25, November4,
November 2009 444.20 37,432 378.55 22,887 411.38
2009 2009

(Source: www.bseindia.com)

NSE
High Volume (No. of Low Volume (No. of Average
Month Date Date
(Rs.) Shares) (Rs.) Shares) (Rs.)
April 2010 April 30, 2010 567.50 723,933 April 1, 2010 524.45 72019 545.98
March 29 March 3
March 2010 540.90 1,186,302 461.6 247,403 501.25
2010 2010
February 3 February 25
February 2010 518.20 302,393 431.00 243,753 474.60
2010 2010
January 18 January 6
January 2010 518.70 213,017 472.95 15,33,860 495.83
2010 2010
December 31, 487.90 245,151 December 1, 419.20 65,818
December 2009 453.55
2009 2009
November 25, November 4,
November 2009 442.15 39,374 379.15 536,885 410.65
2009 2009
(Source: www.nseindia.com)

Notes
• High, low and average prices are of the daily closing prices.
• In case of two days with the same closing price, the date with higher volume has been considered.

Details of the volume of business transacted during the last six months on the Stock Exchanges where our securities are
listed:
(Rs. in lacs)
Period BSE NSE
April 2010 13,210.09 30,719.97
March 2010 8,875.77 41,388.46
February 2010 3,504.85 17,961.32
January 2010 11,346.88 33,451.09
December 2009 5,831.02 17,093.48
November 2009 2,548.43 8,504.36
(Source: www.bseindia.com, www.nseindia.com)

B. Trading of Debentures

The following privately placed debentures issued by the Company have been traded on the WDM segment of NSE in the

- 207 -
last 3 years preceding the date of this Prospectus:

Last
Trade Last Trade Total Trade Last Trade Weighted
Date of Price( Rs. Value( Rs in Value( Rs in Yield(%) Average
ISIN No. Trade In Lacs) lacs) lacs) per annum Price(Rs.)
ISIN
INE721A 04-Jul-
07226 07 99.9979 2500 2500 10.902 99.9979
ISIN
INE721A 09-Aug-
07226 07 100.8337 2500 2500 9.983 100.8337
ISIN
INE721A 21-Jul-
07242 09 103.6359 2500 5000 7.2111 103.6126
ISIN
INE721A 09-Aug-
07259 07 101.3586 1000 2000 10.944 100.6793
ISIN
INE721A 06-Sep-
07259 07 101.1736 1500 1500 11.019 101.1736
ISIN
INE721A 09-Apr-
07259 09 101.9489 1500 1500 9.6806 101.9489
ISIN
INE721A 21-Jul-
07259 09 103.8162 1500 1500 7.2584 103.8162
ISIN
INE721A 06-Oct-
07259 09 102.2086 200 200 8.25 102.2086
ISIN
INE721A 07-Aug-
07317 09 101.3 1000 1000 0 101.3
ISIN
INE721A 20-Apr-
07333 09 100.6438 2500 2500 8.2545 100.6438
ISIN
INE721A 13-May-
07333 09 100.8642 1500 1500 7.1704 100.8642
ISIN
INE721A 08-Oct-
07424 09 102.4877 2500 2500 7.4103 102.4877
ISIN
INE721A 29-Oct-
07424 09 102.8835 2500 2500 6.7715 102.8835
ISIN
INE721A 03-Nov-
07424 09 102.8486 2500 2500 6.7688 102.8486
ISIN
INE721A 23-Oct-
07531 09 102.8302 2061.14 2061.14 7.2318 102.8302
ISIN
INE721A 02-Apr-
07549 09 98.7184 2500 2500 11.1 98.7184
ISIN
INE721A 08-Apr-
07549 09 98.7289 1500 1500 11.1 98.7289
- 208 -
 Last
Trade Last Trade Total Trade Last Trade Weighted
Date of Price( Rs. Value( Rs in Value( Rs in Yield(%) Average
ISIN No. Trade In Lacs) lacs) lacs) per annum Price(Rs.)
ISIN
INE721A 24-Apr-
07549 09 98.7476 1500 1500 11.1127 98.7476
ISIN
INE721A 01-Sep-
07549 09 101.7763 4000 4000 8.4852 101.7763
ISIN
INE721A 02-Sep-
07549 09 101.7573 4000 4000 8.5 101.7573
ISIN
INE721A 08-Sep-
07549 09 102.1541 2500 2500 8.1 102.1541
ISIN
INE721A 16-Sep-
07549 09 102.4794 2500 2500 7.75 102.4794
ISIN
INE721A 23-Oct-
07549 09 102.106 2044.36 2044.36 7.9392 102.106
ISIN
INE721A 03-Nov-
07549 09 103.1823 3000 3000 6.6802 103.1823
ISIN
INE721A 21-Apr-
07598 09 96.3 500 500 14.174 96.3
ISIN
INE721A 23-Apr-
07598 09 96.31 500 500 14.163 96.31
ISIN
INE721A 21-Apr-
07655 09 92.1479 2500 2500 0 92.1479
ISIN
INE721A 26-Aug-
07663 09 100.3213 5613.46 5613.46 3.45 100.3213
ISIN
INE721A 06-Oct-
07689 09 103.1998 700 700 8.7175 103.1998
ISIN
INE721A 18-Nov-
07929 09 102.5428 2666.84 2666.84 7.4024 102.5428
ISIN
INE721A 19-Nov-
07AB8 09 101.3878 715.9 715.9 7.3622 101.3878
ISIN
INE721A 24-Nov-
07AB8 09 101.5003 717.51 717.51 7.2656 101.5003
(Source: www.nseindia.com)

The following debentures issued by the Company have been traded on the WDM segment of NSE and BSE in the last 6
months preceding the date of this Prospectus:

NSE

SCRIP CODE: N 1
- 209 -
 ISIN -INE721A07952

Volume on
date of High Volume on date
Date of ( No of Date of of Low ( No of Average
Month High High ( Rs) Debentures ) Low Low (Rs) Debentures ) (Rs )
09-Nov-
Nov-09 16-Nov-09 1,103.80 83 09 1,065.77 350 1084.79
01-Dec-
Dec-09 16-Dec-09 1,115.66 213 09 1,097.78 137 1106.72
29-Jan-
Jan-10 19-Jan-10 1,121.90 108 10 1,061.01 2 1091.46
06-Feb-
Feb-10 01-Feb-10 1,106.73 97 10 1,076.22 1,486 1091.48
25-Mar-
Mar-10 09-Mar-10 1101.73 179 10 1047.23 432 1074.48
01-Apr-
Apr- 10 21-Apr-10 1080.45 260 10 1055.00 60 1067.73

SCRIP CODE: N 2
ISIN -INE721A07960

Volume on date Volume on date

Date of High ( of High ( No of Date of Low of Low ( No of Average (Rs
Month High Rs) Debentures ) Low (Rs) Debentures ) )
27-Nov-
Nov-09 09 1,105.25 317 03-Nov-09 1,082.50 535 1093.88
30-Dec-
Dec-09 09 1,110.00 170 04-Dec-09 1,093.71 775 1101.86
11-Jan-
Jan-10 10 1,129.80 560 29-Jan-10 1,095.00 32 1112.40
05-Feb-
Feb-10 10 1,105.55 304 02-Feb-10 1,092.95 525 1099.25
10-Mar-
Mar-10 10 1114.25 2430 22-Mar-10 1054.00 311 1084.13
26-Apr-
Apr-10 10 1095.55 541 01-Apr-10 1063.00 656 1079.28

SCRIP CODE: N 3
ISIN: INE721A07978

Volume on
Volume on date of Low
date of High ( ( No of
Date of High ( No of Date of Debentures
Month High Rs) Debentures ) Low Low (Rs) ) Average (Rs )
06-Nov-
Nov-09 20-Nov-09 1,131.00 906 09 1,094.48 385 1112.74
07-Dec-
Dec-09 21-Dec-09 1,132.82 1,666 09 1,105.69 480 1119.26
06-Jan-
Jan-10 19-Jan-10 1,137.57 595 10 1,126.50 1,022 1132.04
26-Feb-
Feb-10 17-Feb-10 1,136.11 684 10 1,116.91 732 1126.51
Mar-10 08-Mar-10 1124.68 1205 22-Mar- 1,106.00 100 1115.34
- 210 -
 Volume on
Volume on date of Low
date of High ( ( No of
Date of High ( No of Date of Debentures
Month High Rs) Debentures ) Low Low (Rs) ) Average (Rs )
10
01-Apr-
Apr-10 29-Apr-10 1149.10 501 10 1,114.55 279 1131.83

SCRIP CODE: N 4
ISIN - INE721A07986

Volume on Volume on
date of High date of Low
( No of ( No of
Date of Debentures Date of Low Debentures Average (Rs
Month High High ( Rs) ) Low (Rs) ) )
Nov-09 24-Nov-09 1,099.00 80 03-Nov-09 1,052.00 198 1075.50
Dec-09 30-Dec-09 1,095.00 215 17-Dec-09 1,080.21 4 1087.61

Jan-10 20-Jan-10 1,108.58 540 11-Jan-10 1,083.95 202 1096.27

Feb-10 03-Feb-10 1,100.94 20 05-Feb-10 1,090.00 60 1095.47
22-Mar-
Mar-10 03-Mar-10 1188.00 1 10 1044.00 470 1116.00
Apr-10 13-Apr-10 1120.96 104 01-Apr-10 1045.40 342 1083.18

SCRIP CODE: N 5
ISIN- INE721A07994

Volume on Volume on
date of date of
High ( No Low ( No
of of
Date of High ( Debentures Date of Low Debentures
Month High Rs) ) Low (Rs) ) Average (Rs )
Nov-09 25-Nov-09 1,079.99 72 05-Nov-09 1,053.00 1,407 1066.50
Dec-09 04-Dec-09 1,087.00 2 30-Dec-09 1,073.94 21 1080.47
Jan-10 13-Jan-10 1,097.90 11 29-Jan-10 1,073.00 26 1085.45
Feb-10 01-Feb-10 1099.99 1 22-Feb-10 1,075.00 10 1087.50
Mar-10 12-Mar-10 1093.79 350 15-Mar-10 1037.00 20 1065.40
Apr-10 30-Apr-10 1057.76 2626 13-Apr-10 1034.01 26 1045.89
(Source: www.nseindia.com)

BSE

SCRIP CODE-934785
ISIN: INE721A07952

Volume on Volume on
High ( date of Date of Low date of Low
Month Date of High Rs) High ( No Low (Rs) ( No of Average (Rs )

- 211 -
 of Debentures
Debentures )
)
Feb-10 25/02/2010 1093.79 395 26/02/2010 1082.05 10 1087.92
Mar-10 12/03/2010 1100.00 106 25/03/2010 1040.55 10 1070.28
Apr-10 16/04/2010 1095.00 1 06/04/2010 1044.02 60 1069.51
(Source: www.bseindia.com)

SCRIP CODE -934786

ISIN: INE721A07960

Volume on Volume on
date of date of
High ( No Low ( No
of of
Date of High ( Debentures Date of Low Debentures
Month High Rs) ) Low (Rs) ) Average (Rs )
Feb-10 0 0 0 0 0 0 0.00
Mar-10 22/03/2010 1125.00 100 16/03/2010 1045.00 70 1085.00
Apr-10 30/04/2010 1097.20 5 13/04/2010 1062.15 3 1079.68
(Source: www.bseindia.com)

SCRIP CODE -934787

ISIN: INE721A07978

Volume on Volume on
date of date of
High ( No Low ( No
of of
Date of High ( Debentures Date of Low Debentures
Month High Rs) ) Low (Rs) ) Average (Rs )
Feb-10 26/02/2010 1111.05 10 25/02/2010 1130.00 10 1120.53
Mar-10 31/03/2010 1119.20 75 08/03/2010 1091.71 30 1105.46
Apr-10 22/04/2010 1140.00 145 01/04/2010 1111.05 23 1125.52

SCRIP CODE -934788

ISIN: INE721A07986

Volume on Volume on
date of date of
High ( No Low ( No
of of
Date of High ( Debentures Date of Low Debentures
Month High Rs) ) Low (Rs) ) Average (Rs )
Feb-10 0 0 0 0 0 0 0.00
Mar-10 09/03/2010 1135.00 115 25/03/2010 1070.00 125 1102.50
Apr-10 20/04/2010 1090.00 22 23/04/2010 1070.00 3 1080.00
(Source: www.bseindia.com)

- 212 -
 SCRIP CODE -934789
ISIN: INE721A07994

Volume on Volume on
date of date of
High ( No Low ( No
of of
Date of High ( Debentures Date of Low Debentures
Month High Rs) ) Low (Rs) ) Average (Rs )
Feb-10 0 0 0 0 0 0 0.00
Mar-10 12/03/2010 1100.00 40 25/03/2010 1030.00 35 1065.00
Apr-10 20/04/2010 1072.20 31 07/04/2010 1042.20 20 1057.20
(Source: www.bseindia.com)

Save as disclosed hereinabove, other privately placed debentures issued by our Company which are listed on the WDM
segment of NSE and BSE have not been traded in the last three years.

Debentures or bonds and redeemable preference shares and other instruments issued by our Company and
outstanding

As on December 31, 2009 our Company has listed rated/ unrated, secured/ unsecured, non-convertible redeemable
debentures aggregating to an outstanding amount of Rs. 360,699.96 lacs. Apart from the above, there are no outstanding
debenture bonds, redeemable preference shares or other instruments issued by our Company that are outstanding.
Redeemable non-convertible debentures for an aggregate of Rs.1,000 crore publically issued by our Company in July
2009 are listed on NSE.

Dividend

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

The Board of Directors, at the meeting held on April 29, 2010 has recommended a final dividend of Rs.4/- per Equity
Share at the rate of 40%, for the Financial Year 2009-2010, subject to the shareholders approval. The following table
details the dividend declared/recommended by our Company on the Equity Shares for the Financial Years ended March
31,2005, 2006, 2007, 2008 ,2009 and for nine months ended December 31, 2009:

Statement of Dividend in respect of Equity Shares (Rs. In Lacs)

For Nine
months ended
Particulars
December 31, Year ended As at 31st March
2009 2009 2008 2007 2006 2005
Interim
Rate of Dividend 20% 10% 10% 10% 10% 10%
Number of Equity
Shares on which
Interim Dividend paid 212,737,916 203,502,416 203,135,416 174,901,466 126,061,899 51,949,549
Amount of Interim
Dividend 4,254.76 2,035.03 2,031.35 1,749.01 1,260.62 519.50
Dividend Distribution

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 Statement of Dividend in respect of Equity Shares (Rs. In Lacs)

For Nine
months ended
Particulars
December 31, Year ended As at 31st March
2009 2009 2008 2007 2006 2005
Tax 723.10 345.85 345.23 245.30 176.80 67.89

Rate of Dividend - - - - 20% -

Number of Equity
Shares on which
Interim Dividend paid - - - - 150,540,580 -
Amount of Interim
Dividend - - - - 3,010.81 -
Dividend Distribution
Tax - - - - 422.27 -

Final Dividend for the

previous year

Rate of Dividend 40% 40% 20% - - -

Number of Equity
Shares on which Final
Dividend paid 8,129,550 263,100 6,942,500 - - -
Amount of Final
Dividend 325.18 10.52 138.85 - - -
Dividend Distribution
Tax 55.26 1.79 23.60 - - -

Proposed Final
Dividend for the
current year

Rate of Dividend - 40% 40% 20% 30%** 15%

Number of Equity
Shares on which
dividend paid - 203,511,616 203,135,416 184,158,716 18,645,886 65,428,549
Amount of Final
Dividend - 8,140.46 8,125.42 3,683.17 559.38 981.43
Dividend Distribution
Tax - 1,383.52 1,380.92 625.95 78.45 128.26
**Represents Dividend of 30% for Shareholders of Shriram Overseas Finance Limited pursuant to Amalgamation.

Pursuant to a resolution passed by our Board of Directors at their meeting held on April 29, 2010, our Board of Directors
recommended a final dividend at a rate of Rs. 4 per Equity Share (i.e. 40%) for payment to the shareholders of our
Company for the financial year ended March 31, 2010 aggregating to an amount of Rs. 9,020.71 lacs. The aforesaid final
dividend is subject to the approval of the shareholders of our Company.

The following table details the dividend declared/recommended by our Company on the preference shares of our
Comapny for the Financial Years ended March 31,2005, 2006, 2007, 2008 and 2009:

No. of Shares

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 Rates For Nine months Year ended As at 31st March
ended December
31,
2009 2009 2008 2007 2006 2005
6.00%
- - - - 481,930 3,960
8.00%
- - - - 25,270 260
9.00%
- - - - 4,548,880 2,417,850
10.00%
- - - - 23,590
12.00%
- - - - 15,680 15,530
12.50%
- - - - 41,340 25,940
14.00%
- - - - 81,850 30,600
15.00%
- - - - 169,810 36,510
Total Shares
- - - - 5,388,350 2,530,650
Amount of Dividend
- - - 423.67 228.21
Dividend Distribution Tax
- - - - 59.43 29.82

Note: The Preference shares outstanding as on March 31, 2005 were redeemed in the financial year 2005-06 and were
paid pro-rata dividend at coupon rates prevailing in financial year 2004-05.

Revaluation of assets

The Company has not revalued its assets in the last five years.

Mechanism for redressal of investor grievances

The MoU between the Registrar to the Issue and the Company will provide for retention of records with the Registrar to
the Issue for a period of at least three years from the last date of despatch of the Allotment Advice, demat credit and
refund orders to enable the investors to approach the Registrar to the Issue for redressal of their grievances.

All grievances relating to the Issue may be addressed to the Registrar to the Issue, giving full details such as name,
address of the applicant, number of NCDs applied for, amount paid on application and the bank branch or collection
centre where the application was submitted. The contact details of Registrar to the Issue are as follows:

Integrated Enterprises (India) Limited

2nd Floor,
Kences Towers,
No1, Ramakrishna Street,
North Usman Road, T. Nagar,
Chennai - 600 017
Tel:+91 44 2814 0801/03
Fax: +91 44 2814 2479
Email: stfcipo@iepindia.com
Investor Grievance Email:
sureshbabu@iepindia.com
Website: www.iepindia.com
Contact Person: Ms. Anusha N.
Compliance Officer: Mr. Suresh Babu K.

We estimate that the average time required by us or the Registrar to the Issue for the redressal of routine investor
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grievances will be 7 (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.
Mr. K. Prakash has been appointed as the Compliance Officer of our Company for this issue.

The contact details of Compliance officer of our Company are as follows:

Mr. K. Prakash,
Wockhardt Towers, Level-3
West Wing, C–2, G Block, Bandra – Kurla Complex
Bandra (East)
Mumbai – 400 051
Tel. No. 91-22-4095 9595
Fax: 91-22-4095 9597/96
E-mail: stfcncd2@stfc.in

Change in Auditors of the Company during the last three years

There has been no change(s) in the Statutory Auditors of our Company in the last 3 (three) financial years preceding the
date of this Prospectus.

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 REGULATIONS AND POLICIES

The regulations summarised below are not exhaustive and are only intended to provide general information to Investors
and is neither designed nor intended to be a substitute for any professional legal advice. Taxation statutes such as the IT
Act, Central Sales Tax Act, 1956 and applicable local sales tax statutes, labour regulations such as the Employees State
Insurance Act, 1948 and the Employees Provident Fund and Miscellaneous Act, 1952, and other miscellaneous
regulations such as the Trade and Merchandise Marks Act, 1958 and applicable Shops and Establishments statutes
apply to us as they do to any other Indian company and therefore have not been detailed below. The following
information is based on the current provisions of applicable Indian law, which are subject to change or modification by
subsequent legislative, regulatory, administrative or judicial decisions.

As per the RBI Act, a financial institution has been defined as a company which includes a non-banking institution
carrying on as its business or part of its business the financing activities, whether by way of making loans or advances or
otherwise, of any activity, other than its own and it is engaged in the activities of loans and advances, acquisition of
shares/stock/bonds/debentures/securities issued by the Government of India or other local authorities or other marketable
securities of like nature, leasing, hire-purchase, insurance business, chit business but does not include any institution
whose principal business is that of carrying out any agricultural or industrial activities or the sale/purchase/construction
of immovable property.

Any company which carries on the business of a non-banking financial institution as its principal business is to be treated
as an NBFC. Since the term 'principal business' has not been defined in law, the RBI has clarified through a press release
(Ref. No. 1998-99/ 1269) in 1999, that in order to identify a particular company as an NBFC, it will consider both the
assets and the income pattern as evidenced from the last audited balance sheet of the company to decide its principal
business. The company will be treated as an NBFC if its financial assets are more than 50 per cent of its total assets
(netted off by intangible assets) and income from financial assets should be more than 50 per cent of the gross income.
Both these tests are required to be satisfied as the determinant factor for principal business of a company.

With effect from 1997, NBFCs were not permitted to commence or carry on the business of a non banking financial
institution without obtaining a Certificate of Registration (CoR). Further, with a view to imparting greater financial
soundness and achieving the economies of scale in terms of efficiency of operations and higher managerial skills, the
RBI has raised the requirement of minimum net owned fund from Rs. 2.5 million to Rs. 20 million for the NBFC which
commences business on or after April 21, 1999. Further, every NBFC is required to submit to the RBI a certificate,
from its statutory auditor within one month from the date of finalization of the balance sheet and in any case not later
than December 30th of that year, stating that it is engaged in the business of non-banking financial institution requiring it
to hold a CoR.

1. Regulation of NBFCs registered with the RBI

NBFCs are primarily governed by the RBI Act, 1934 (“RBI Act”), the Non-Banking Financial (Deposit
Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007, (“APD Directions”),
the Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998,
(“Public Deposit Directions”), the Non-Banking Financial (Non-Deposit Accepting or Holding) Companies
Prudential Norms (Reserve Bank) Directions, 2007 (“Non- Deposit Accepting NBFC Directions”), and the
provisions of the Non- Banking Financial Companies Prudential Norms (Reserve Bank) Directions, 1998. In
addition to these regulations, NBFCs are also governed by various circulars, notifications, guidelines and
directions issued by the RBI from time to time.

2. Types of Activities that NBFCs are permitted to carry out

Although by definition, NBFCs are permitted to operate in similar sphere of activities as banks, there are a few
important, key differences. The most important distinctions are:

(i) an NBFC cannot accept deposits repayable on demand – in other words, NBFCs can only accept fixed
term deposits. Thus, NBFCs are not permitted to issue negotiable instruments, such as cheques which
are payable on demand; and

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 (ii) NBFCs are not allowed to deal in foreign exchange, even if they specifically apply to the RBI for
approval in this regard.

3. Types of NBFCs:

Section 45-IA of the RBI Act makes it mandatory for every NBFC to get itself registered with the Reserve Bank
in order to be able to commence any of the aforementioned activities.

Further, an NBFC may be registered as a deposit accepting NBFC (“NBFC-D”) or as a non-deposit accepting
NBFC (“NBFC-ND”).

NBFCs registered with RBI are further classified as:

(i) asset finance companies;

(ii) investment companies; and/or

(iii) loan companies and/or

(iv) infrastructure finance companies

Our Company has been classified as an NBFC-D and is further classified as an “asset finance company”. An
asset finance company is an NBFC whose principal business is to finance physical assets supporting productive
/ economic activity, such as automobiles, tractors, lathe machines, generator sets, earth moving and material
handling equipments, moving on own power and general purpose industrial machines.

4. Regulatory Requiresments of an NBFC under the RBI Act

Net Owned Fund

Section 45-IA of the RBI Act provides that to carry on the business of a NBFC, an entity would have to register
as an NBFC with the RBI and would be required to have a minimum net owned fund of Rs. 2,00,00,000
(Rupees two crore only). For this purpose, the RBI Act has defined “net owned fund” to mean:

(a) the aggregate of the paid-up equity capital and free reserves as disclosed in the latest balance sheet of the
company, after deducting (i) accumulated balance of losses, (ii) deferred revenue expenditure, and (iii) other
intangible assets; and

(b) further reduced by the amounts representing,

(1) investment by such companies in shares of (i) its subsidiaries, (ii) companies in the same group, (iii)
other NBFCs, and

(2) the book value of debentures, bonds, outstanding loans and advances (including hire purchase and
lease finance) made to, and deposits with (i) subsidiaries of such companies; and (ii) companies in the
same group,

to the extent such amount exceeds 10% of (a) above.

Reserve Fund

In addition to the above, Section 45-IC of the RBI Act requires NBFCs to create a reserve fund and transfer
therein a sum of not less than 20% of its net profits earned annually before declaration of dividend. Such sum
cannot be appropriated by the NBFC except for the purpose as may be specified by the RBI from time to time
and every such appropriation is required to be reported to the RBI within 21 days from the date of such
withdrawal.

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 Maintenance of liquid assets

The RBI through notification dated January 31, 1998, as amended has prescribed that every NBFC shall invest
and continue to invest in unencumbered approved securities valued at a price not exceeding the current market
price of such securities an amount which shall, at the close of business on any day be not less than 10% in
approved securities and the remaining in unencumbered term deposits in any scheduled commercial bank; the
aggregate of which shall not be less than 15% of the public deposit outstanding at the last working day of the
second preceding quarter.

5. Obligations of NBFC-D under the Public Deposit Directions

The RBI’s Public Deposit Directions governs the manner in which NBFCs may accept and/or hold public
deposits. The Public Deposit Directions places the following restrictions on NBFCs in connection with
accepting public deposits:

1. Prohibition from accepting any demand deposits: NBFCs are prohibited from accepting any public deposit
which is repayable on demand.

2. Ceiling on quantum of deposits: A NBFC which is classified as an asset finance company, (a) having net owned
funds of Rs. 25,00,000/- (Rupees twenty five lac only) or more, and, (b) having complied with all prudential
norms relating to the capital adequacy ratio of not less than fifteen percent as per last audited balance-sheet,
may, accept or renew public deposits not exceeding one and one-half times of its net owned funds or public
deposit up to Rs. 10,00,00,000/- (Rupees ten crore), whichever is less. Further, an asset finance company, (a)
having net owned funds Rs. 25,00,000/- (Rupees twenty five lac only) or more, (b) having complied with all the
prudential norms, and (c) having obtained minimum investment grade credit rating from a notified credit rating
agency, may, accept or renew public deposits not exceeding four times of its net owned funds.

3. Downgrading of credit-rating: In the event that the credit rating issued by a credit rating agency recognised by
RBI, for an asset finance company is downgraded below the minimum specified investment grade, with respect
to the relevant credit rating agency, the NBFC must (a) forthwith stop accepting public deposit, (b) report the
position of the credit rating within fifteen working days to the RBI, and, (c) reduce, within three years from the
date of such downgrading of credit rating, the amount of excess public deposit to nil or the appropriate extent as
permitted under the Public Deposit Directions, by repayment as and when such deposit falls due or otherwise.

4. Ceiling on rate of interest: An NBFC cannot invite or accept or renew public deposit at a rate of interest
exceeding twelve and half per cent per annum. Such interest may be paid or compounded at rests which shall
not be shorter than monthly rests.

5. Minimum lock-in period: An NBFC is prohibited from granting any loan against a public deposit or make
premature repayment of a public deposit within a period of three months from the date of acceptance of such
public deposit.

6. Obligations of NBFC-D under the APD Directions

NBFC-Ds are required to comply with prescribed capital adequacy ratios, single and group exposure norms, and
other specified prudential requirements prescribed under the APD Directions. Some of the important obligations
are as follows:

i) Income Recognition: NBFC-Ds are required to follow recognised accounting principles in connection
with recognition of income. Income including interest/discount or any other charges on NPA is
recognised only when it is actually realised. Any such income recognised before the asset became non-
performing and remaining unrealised must be reversed. With respect to hire purchase assets, where
instalments are overdue for more than 12 months, income shall be recognised only when hire charges
are actually received. Any such income taken to the credit of profit and loss account before the asset
became non-performing and remaining unrealised, must be reversed.

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ii) Asset Classification and provisioning of assets: Every NBFC-D is required to, after taking into account
the degree of well defined credit weaknesses and extent of dependence on collateral security for
realisation, classify its lease/hire purchase assets, loans and advances and any other forms of credit into
the following classes, namely:

• Standard assets;
• Sub-standard assets;
• Doubtful assets; and
• Loss assets.

Further, an NBFC-D must, after taking into account the time lag between an account becoming non-
performing, its recognition as such, the realisation of the security and the erosion over time in the value
of security charged, make provision against sub-standard assets, doubtful assets and loss assets in the
manner prescribed by RBI.

iii) Loans against NBFC’s own shares prohibited: No NBFC-D can lend against its own shares, as of July
1, 2008. Any outstanding loan granted by a NBFC-D against its own shares on the date of
commencement of these Directions shall be recovered by the NBFC as per the repayment schedule.

iv) NBFC failing to repay public deposit prohibited from making loans and investments: A NBFC-D
which has failed to repay any public deposit or part thereof in accordance with the terms and
conditions of such deposit, cannot grant any loan or other credit facility by whatever name called or
make any investment or create any other asset as long as such default exists.

v) Exposure to capital-markets: Every NBFC-D with total assets of Rs. 100 crore and above according to
the previous audited balance sheet, must submit a monthly return within a period of 7 days of the
expiry of the month to which it pertains in the prescribed form to the Regional Office of the
Department of Non-Banking Supervision of the RBI.

vi) Capital Adequacy: Every NBFC-D shall maintain a minimum CAR consisting of Tier I and Tier II
capital which must not be less than twelve per cent of its aggregate risk weighted assets on balance
sheet and of risk adjusted value of off-balance sheet items. The total of Tier II capital of any NBFC-D,
at any point of time, must not exceed one hundred per cent of Tier I capital.

vii) Disclosure Requirements: Every NBFC-D is required to separately disclose in its balance sheet the
provisions made in accordance with the applicable prudential norms prescribed by the RBI without
netting them from the income or against the value of assets. Further, the provisions must be distinctly
indicated under separate heads of account as under:

• provisions for bad and doubtful debts; and

• provisions for depreciation in investments.

Such provisions shall not be appropriated from the general provisions and loss reserves held, if any, by
the NBFC-D and for each year shall be debited to the profit and loss account. The excess of provisions,
if any, held under the heads general provisions and loss reserves may be written back without making
adjustment against them.

viii) Monthly Return: Every NBFC with total assets of Rs. 100 crore and above according to the previous
21 days audited balance sheet, is required to submit a monthly return within a period of 7 days of the
expiry of the month to which it pertains in the prescribed format to the Regional Office of the
Department of Non-Banking Supervision of the RBI.

ix) Fair Practices Code: The RBI has framed the fair practice guidelines, to promote good and fair
practices by setting minimum standards to be adhered to by NBFCs in dealing with customers. These
guidelines require NBFCs to ensure that they meet the commitments and standards specified therein

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 for the products and services they offer and in the procedures and practices their staff follows, their
products and services meet relevant laws and regulations in letter and spirit, and their dealings with
customers rest on ethical principles of integrity and transparency. Further, the said guidelines prescribe
the requirements in connection with information to be provided and disclosures to be made by NBFCs
to their customers. Accordingly, the guidelines require NBFCs to provide information on interest rates,
common fees and charges, provide clear information explaining the key features of their services and
products that customers are interested in, provide information on any type of product and service
offered, that may suit the customer’s needs, tell the customers about the various means through which
products and services are offered, and provide more information on the key features of the products,
including applicable interest rates / fees and charges.

x) KYC Guidelines: NBFCs have been advised to follow certain customer identification procedure for
opening of accounts and monitoring transactions of suspicious nature for the purpose of reporting it to
appropriate authority, (“KYC Norms”). Accordingly, NBFCs have been advised to ensure that a
proper policy framework on ‘know your customer’ and anti-money laundering measures is formulated
and put in place with the approval of the RBI. The KYC Norms also require that while preparing
operational guidelines NBFCs may keep in mind to treat the information collected from the customer
for the purpose of opening of account as confidential and not divulge any details thereof for cross
selling or any other purposes. NBFCs may, therefore, ensure that information sought from the
customer is relevant to the perceived risk, is not intrusive, and is in conformity with the guidelines
issued in this regard. Any other information from the customer should be sought separately with his
/her consent and after opening the account.

Rating of Financial Product

As per RBI Circular dated February 4, 2009 all NBFCs with assets size of Rs. 10,000 lacs and above is required to
furnish at the regional office of the RBI under whose jurisdiction the registered office of the NBFC is functioning,
information relating to the downgrading and upgrading of assigned rating of any financial products issued by them
within 15 days of such change.

Norms for excessive interest rates

RBI through its circular dated May 24, 2007 directed all NBFCs to put in place appropriate internal principles and
procedures in determining interest rates and processing and other charges. In addition to the aforesaid instruction RBI
has issued a circular dated January 2, 2009 and a master circular on Fair Practices Code dated July 1, 2009 for regulating
the excessive rates of interest charged by the NBFCs. The aforementioned circular and the master circular stipulate that
the board of each NBFC shall adopt an interest rate model taking into account the various relevant factors such as cost of
funds, margin and risk premium etc. The rate of interest and the approach for gradation of risk and the rationale for
charging different rates of interest for different categories of borrowers shall be required to be disclosed to the borrowers
in the application form and communicated explicitly in the sanction letter. Further, the same is also required to be made
available on the company’s website or be published in the relevant newspapers and is required to be updated in the event
of any change therein. Further, the rate of interest would have to be annualized rates so that that the borrower is aware of
the exact rates that would be charged to the account.

7. Corporate Governance

Pursuant to RBI circular (DNBS.PD/CC 94/03.10.042/2006-07) dated May 8, 2007, the RBI has proposed
certain corporate governance guidelines for the consideration of all NBFC–D with an asset size of Rs. 20 crore
or more. The guidelines recommend that such NBFCs constitute an Audit Committee, a Nomination Committee
(to ensure that fit and proper persons are nominated as directors on their respective boards) and a Risk
Management Committee to institute risk management systems. The guidelines have also issued instructions
relating to credit facilities to directors, loans and advances to relatives of the directors of the said NBFCs or to
the directors of other companies and their relatives and other entities, timeframe for recovery of such loans, etc.
Such NBFCs are also required to frame internal corporate governance guidelines based on the guidelines issued
by the RBI on May 8, 2007.

8. Accounting Standards & Accounting policies

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 Subject to the changes in Indian Accounting Standards and regulatory environment applicable to a NBFC we
may change our accounting policies in the future and it might not always be possible to determine the effect on
the Profit and Loss account of these changes in each of the accounting years preceding the change.

In such cases our profit/ loss for the preceding years might not be strictly comparable with the profit/ loss for
the period for which such accounting policy changes are being made.

9. Reporting by Statutory Auditor

The statutory auditor of the NBFC-D is required to submit to the Board of Directors of the company a report
inter-alia certifying that the Directors have passed the requisite resolution(s), has complied with the prudential
norms relating to income recognition, accounting standards, asset classification and provisioning for bad and
doubtful debts as applicable to it. In the event of non-compliance, the statutory auditors are required to directly
report the same to the RBI.

10. Other Regulations

Applicable Foreign Investment Regime

FEMA Regulations

Foreign investment in India is governed primarily by the provisions of the FEMA which relates to regulation primarily
by the RBI and the rules, regulations and notifications thereunder, and the policy prescribed by the Department of
Industrial Policy and Promotion (DIPP), GoI which is regulated by the FIPB.

The RBI, in exercise of its power under the FEMA, has notified the Foreign Exchange Management (Transfer or Issue of
Security by a Person Resident Outside India) Regulations, 2000 (“FEMA Regulations”) to prohibit, restrict or regulate,
transfer by or issue of security to a person resident outside India. As laid down by the FEMA Regulations, no prior
consent and approval is required from the RBI, for FDI under the “automatic route” within the specified sectoral caps. In
respect of all industries not specified as FDI under the automatic route, and in respect of investment in excess of the
specified sectoral limits under the automatic route, approval may be required from the FIPB and/or the RBI.

Foreign Direct Investment

FDI in an Indian company is governed by the provisions of the FEMA read with the FEMA Regulations and the Foreign
Direct Investment Policy (“FDI Policy”) by the DIPP. FDI is permitted (except in the prohibited sectors) in Indian
companies either through the automatic route or the approval route, depending upon the sector in which FDI is sought to
be made. Under the automatic route, no prior Government approval is required for the issue of securities by Indian
companies/ acquisition of securities of Indian companies, subject to the sectoral caps and other prescribed conditions.
Investors are required to file the required documentation with the RBI within 30 days of such issue/ acquisition of
securities.

Under the approval route, prior approval from the FIPB or RBI is required. FDI for the items/ activities that cannot be
brought in under the automatic route (other than in prohibited sectors) may be brought in through the approval route.
Further:

(a) As per the sector specific guidelines of the Government of India, 100% FDI/ NRI investments are allowed
under the automatic route in certain NBFC activities subject to compliance with guidelines of the RBI in this
regard.

(b) Minimum Capitalisation Norms for fund based NBFCs:

(i) For FDI up to 51% - US$ 0.5 million to be brought upfront

(ii) For FDI above 51% and up to 75% - US $ 5 million to be brought upfront
(iii) For FDI above 75% and up to 100% - US $ 50 million out of which US $ 7.5 million to be brought
upfront and the balance in 24 months
- 222 -
(c) Minimum capitalization norm of US $0.5 million is applicable in respect of all permitted non fund based
NBFCs with foreign investment

(d) Foreign investors can set up 100% operating subsidiaries without the condition to disinvest a minimum of 25%
of its equity to Indian entities, subject to bringing in US$ 50 million as at (b) (iii) above(without any restriction
on number of operating subsidiaries without bringing in additional capital)

(e) Joint ventures operating NBFC’s that have 75% or less than 75% foreign investment will also be allowed to set
up subsidiaries for undertaking other NBFC activities, subject to the subsidiaries also complying with the
applicable minimum capital inflow i.e. (b) (i) and (b)(ii) above.

Where FDI is allowed on an automatic basis without FIPB approval, the RBI would continue to be the primary agency
for the purposes of monitoring and regulating foreign investment. In cases where FIPB approval is obtained, no approval
of the RBI is required except with respect to fixing the issuance price, although a declaration in the prescribed form,
detailing the foreign investment, must be filed with the RBI once the foreign investment is made in the Indian company.
The foregoing description applies only to an issuance of shares by, and not to a transfer of shares of, Indian companies.
Every Indian company issuing shares or convertible debentures in accordance with the RBI regulations is required to
submit a report to the RBI within 30 days of receipt of the consideration and another report within 30 days from the date
of issue of the shares to the non resident purchaser.

Laws relating to Employment

Shops and Establishments legislations in various states

The provisions of various Shops and Establishments legislations, as applicable, regulate the conditions of work and
employment in shops and commercial establishments and generally prescribe obligations in respect of inter alia
registration, opening and closing hours, daily and weekly working hours, holidays, leave, health and safety measures and
wages for overtime work.

Labour Laws

The Company is required to comply with various labour laws, including the Minimum Wages Act, 1948, the Payment of
Bonus Act, 1965, the Payment of Wages Act, 1936, the Payment of Gratuity Act, 1972 and the Employees’ Provident
Funds and Miscellaneous Provisions Act, 1952.

Laws relating to Intellectual Property

The Trade Marks Act, 1999 and the Copyright Act, 1957 inter alia govern the law in relation to intellectual property,
including brand names, trade names and service marks and research works.

In addition to the above, the Company is required to comply with the provisions of the Companies Act, 1956, the
Foreign Exchange Management Act, 1999, various tax related legislations and other applicable statutes.

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 SUMMARY OF KEY PROVISIONS OF ARTICLES OF ASSOCIATION

Pursuant to Schedule II of the Act the main provisions of the AOA relating to the issue and allotment of debentures and
matters incidental thereto. Please note that the each provision herein below is numbered as per the corresponding article
number in the AOA. All defined terms used in this section have the meaning given to them in the AOA. Any reference to
the term “Article” hereunder means the corresponding article contained in the AoA.

Clause (ii) of Article 8 A provides that the Company shall within three months after the allotment or within one month
after the application for registration of the transfer of any Share or Debenture is completed and have ready for delivery
the certificates of all the Shares and Debentures so allotted or transferred unless the conditions of issue of the said Shares
otherwise provide.

Article 8 B provides that if a certificate be worn out, defaced or if there is no further space on the back thereof for
endorsement of transfer, it shall, if required, be replaced by a new certificate free of charge provided/however that such
new certificate shall not be issued except upon delivery of the said worn out or defaced or used up certificate for the
purpose of cancellation. Further, if a certificate is lost or destroyed the Company may, upon such evidence and proof of
such loss or destruction and such Indemnity as the Board may require and on payment of such a fee not exceeding Rupee
one issue a renewed certificate. Any renewed certificate shall be marked as such.

Clause A of Article 9 provides that the Board of Directors may, if they think fit, receive from any member willing to
advance the same, all or any part of the money uncalled and unpaid upon any Share/Debenture held by him and upon all
or any part of the money so advanced may (until the same would but for such advance become presently payable) pay
interest at such rate not exceeding, without sanction of the Company in General Meeting, 14% (fourteen percent per
annum) or such other percentage as may be fixed in this regard as the maximum percentage as may be agreed upon
between the member paying the sum in advance and the Board of Directors, provided that the amount of advance calls so
received shall not be entitled to rank for dividend or participate in the profits of the Company.

Clause (g) of Article 10 provides that notwithstanding anything contained in these Articles, the Board of Directors
of the Company may in their absolute discretion refuse splitting of any Share certificate or Debenture certificate into
denominations less than Marketable lots i.e. the minimum number of Shares or Debentures as required for the purpose of
trading on the stock exchange in which the Company’s Shares and/or Debentures are/will be listed, except where
subdivision is required to be made to comply with a statutory provision or order of a competent Authority of law.

Article 30 provides that in furtherance of and without prejudice to the general powers conferred on the Board of
Directors by or implied in Articles 29 and the other powers conferred by these articles and subject to the provision of
Sec.292 of the Act, it is hereby expressly declared that it shall be lawful, for the Directors to carry out all or any of the
objects set forth in the Memorandum of Association and to do the following things:

Clause (3) of Article 30 At their discretion to pay for any property rights, or privileges acquired by, or services
rendered to the Company, either wholly or partially in cash or in Shares, bonds, Debentures or other securities
of the company and any such Shares may be issued either as fully paid-up or with such amount credited as paid
up thereon as may be agreed upon and any such bonds, Debentures, or other securities may be either
specifically charged upon all or any of the property of the company and its uncalled Shares, or not so charged.

Clause (4) of Article 30 To secure the fulfilment of any contracts or agreement entered into by the Company by
mortgage or charge of all or any of the properties of the Company and its uncalled capital for the time being or
in such other manner as they think fit.

Clause (16) of Article 30 To borrow on mortgage of the whole or any part of the property of the Company or on
the Bonds, Debentures either unsecured or secured by a charge or mortgage or other securities of the Company, or
otherwise as they may deem expedient, such sums as they may think necessary for the purpose of the Company,
subject to provisions contained in Sec.292 and Sec.293 of the Act. Provided that Debentures with the rights to
allotment or conversion into Shares shall not be issued except with the sanction of the Company in General
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 Meeting.

Article 32 provides that he Board of Directors may from time to time but with such consent of the Company in general
meetings as may be required under Sec.293 of the Act, raise any money or any moneys or sum of money for the purpose
of the Company, provided that the moneys to be borrowed together with moneys already borrowed by the company apart
from temporary loans obtained from the Company’s bankers in the ordinary course of business shall not without the
sanction of the Company at a General Meeting exceed the aggregate of the paid-up captial of the company and its free
reserves that is to say reserves not set apart for any specific purpose and in particular but subject to the provision of
Section 292 of the Act, the Board may from time to time at their discretion may raise or borrow or secure the payment of
any such sum or sums of money for the purpose of the Company, by the issue of Debentures to members, raised or
received, to mortgage, pledge or change, the whole or any part of the property, assets, or revenue of the Company,
present or future, including its uncalled capital by special assignment or otherwise or to transfer or convey the same
absolutely or in trust and to give the lenders powers of sale and others as may be expedient and to purchase, redeem or
pay off any such securities. “Debentures, Debenture Stocks, Bonds or other securities with a right to allotment of or
conversion into Shares shall not be issued except with the sanction of the Company in General Meeting”.

Article 43 provides that

Clause (1) of Article 43 Every shareholder or debenture holder or depositor of the Company, may at any time, nominate
a person to whom his shares or debentures or deposits shall vest in the event of his death in such manner as may be
prescribed under the Act.

Clause (2) of Article 43 Where the shares or debentures or deposits of the Company are held by more than one person
jointly, joint holders may together nominate a person to whom all the rights in the shares or debentures or deposits, as the
case may be shall vest in the event of death of all the joint holders in such manner as may be prescribed under the Act.

Clause (2) of Article 43 Notwithstanding anything contained in any other law for the time being in force or in any
disposition, whether testamentary or otherwise, where a nomination made in the manner aforesaid purports to confer on
any person the right to vest the shares of debentures or deposits, the nominee shall, on the death of the shareholder or
debenture holder or depositor or, as the case may be on the death of the joint holders become entitled to all the rights in
such shares or debentures or deposits or, as the case may be, all the joint holders, in relation to such shares or debentures
or deposits, to the exclusion of all other person, unless the nomination is varied or cancelled in the manner as may be
prescribed under the Act.

Article 45 provides that the Company shall be entitled to dematerialise its existing shares, debentures and other
securities, rematerialise its shares, debentures and other securities held in the Depositories and/or offer its fresh shares
and debentures and other securities in a dematerialised form pursuant to the Depositories Act, and the Rules framed
thereunder, if any. Every person subscribing to or holding securities offered by the Company shall have the option to
receive security certificates or to hold the securities with a Depository. Such a person who is the beneficial owner of the
securities can at any time opt out of a depository, if permitted by law, in respect of any security in the manner provided
by the Depositories Act, and the Company shall, in the manner and within the time prescribed, issue to the beneficial
owner the required Certificates of Securities. If a person opts to hold his security with a Depository, the Company shall
intimate such Depository the details of allotment of the security, and on receipt of the information, the Depository shall
enter in its record the name of the allottee as the beneficial owner of the security. The Company shall cause to be kept a
Register and Index of Members and a Register and Index of Debenture holders in accordance with all applicable
provisions of the Companies Act, 1956 and the Depositories Act, with details of shares and Debentures held in material
and dematerial forms in any media as may be permitted by law, including in any form of electronic media. The Register
and Index of Beneficial Owners maintained by Depository under the Depositories Act, shall be deemed to be Register
and Index of Members and Security holders for the purposes of these Articles. The Company shall be entitled to keep in
any State or Country outside India a Branch Register of Members Resident in that State or Country.

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 MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION

The following contracts which are or may be deemed material have been entered or are to be entered into by the
Company. These contracts and also the documents for inspection referred to hereunder, may be inspected at the
Registered Office of the Company situated at 123, Angappa Naicken Street, Chennai – 600 001 from 10.00 AM to 5
P.M on any business days from the date of this Prospectus until the date of closure of the Issue.

A. Material Contracts

1. Engagement Letter dated April 20, 2010 received from the Company appointing J.M. Financial
Consultants Private Limited and ICICI Securities Limited to act as Lead Manager to the Issue, and RR
Investors Capital Services Private Limited to act as the Co-Lead Manager to the Issue.
2. Memorandum of Understanding dated April 20, 2010 between the Company, the Lead Managers and
the Co-Lead Manager
3. Memorandum of Understanding dated April 16, 2010 with the Registrar to the Issue
4. Debenture Trust Agreement dated April 20, 2010 executed between the Company and the Debenture
Trustee
5. The agreed form of the Debenture Trust Deed to be executed between the Company and the Debenture
Trustee
6. Escrow agreement dated May 5, 2010 executed by the Company, the Registrar, the Escrow Collection
Bank(s), the Lead Managers and the Co-Lead Manager

B. Material Documents

1. Certificate of Incorporation of the Company dated June 30, 1979, issued by Registrar of Companies,
Tamil Nadu, Chennai
2. Memorandum and Articles of Association of the Company.
3. The certificate of registration No. 07-00459 dated April 17, 2007 issued by Reserve Bank of India u/s
45 IA of the Reserve Bank of India, 1934.
4. Credit rating letter dated April 19, 2010 from CARE and Credit rating letter dated April 27, 2010 from
CRISIL, granting credit rating to the NCDs to be issued in pursuance of the Prospectus.
5. Copy of the Board Resolution dated January 18, 2010, approving the Issue.
6. Resolution passed by the shareholders of the Company at the Annual General Meeting held on July 24,
2009 approving the overall borrowing limit of Company.
7. Consents of the Directors, Lead Managers to the Issue, the Co-Lead Manager, Debenture Trustee, Lead
Brokers, Credit Rating Agencies, Legal Advisor to the Issue, Bankers to the Issue, Bankers to the
Company and the Registrar to the Issue, to include their names in this Prospectus.
8. Consents of S.R. Batliboi & Co. and G. D. Apte & Co. the Statutory Auditors/ Joint Auditors of our
Company for inclusion of their names, contact details and examination reports on reformatted
unconsolidated and consolidated summary statements and the statements of tax benefits in the form
and context in which they appear in the Prospectus.
9. Appointment of Company Secretary as Compliance Officer for the issue and consent dated April 20,
2010 thereto.
10. The joint examination report of the Auditors as set out herein dated May 3, 2010 in relation to the
Reformatted Summary Financial Statements included herein.
11. Annual Reports of the Company for the last five Financial Years 2004 – 05 to 2008 – 09.
12. Due Diligence certificates all dated May 6, 2010 filed by the Lead Managers, the Co-Lead Manager
and the Debenture Trustee respectively.
13. Tripartite agreement between the Company, Registrar to the Issue and CDSL and the Company,
Registrar to the issue and NSDL dated March 29, 2000 and April 30, 1999, respectively.
14. Copy of the shareholders’ resolution appointing the Managing Director of the Company dated
September 9, 2005 and copy of the shareholders’ resolution revising the remuneration payable to
Managing Director dated July 31, 2008.
15. Share Subscription Agreement dated February 2, 2006 and amendment agreement dated September 12,
2008 with Newbridge India Investments II Limited, Sri R. Thyagarajan, Sri T Jayaraman, Sri AVS
Raja and Shriram Financial Services Holdings Private Limited, Shriram Recon Trucks Limited and
SOFL.
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16. Share Purchase Agreement dated March 28, 2007, with Ashley Transport Services Limited, Ashok
Leyland Limited and INDUSIND Bank.
17. Shareholders Agreement dated March 28, 2007 with Ashok Leyland Limited, Ashley Investments
Limited Ashley Holdings Limited and Ashley Transport Services Limited
18. Agreement dated September 8, 2006 and Supplemental Agreement dated July 20, 2007 with Axis Bank
Limited, (formerly UTI Bank Limited), in connection with co-branded Credit Cards.
19. Employee Stock Option Scheme of 2005 of the Company.
20. In-principle approval, dated April 30, 2010 for the Issue issued by NSE.

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 DECLARATION

We, the Directors of the Shriram Transport Finance Company Limited, certify that all the relevant provisions of the
Companies Act, 1956 and the guidelines issued by the Government of India or the guidelines issued by the Securities
and Exchange Board of India established under Section 3 of the Securities and Exchange Board of India Act, 1992, as
the case may be, have been complied with and no statement made in this Prospectus is contrary to the provisions of the
Companies Act, 1956, the Securities and Exchange Board of India Act, 1992 or the rules made or guidelines issued
thereunder, as the case may be.

Yours faithfully

On behalf of the Board of Directors of SHRIRAM TRANSPORT FINANCE COMPANY LIMITED:

_________________________
MR. ARUN DUGGAL

____________________________
MR. R SRIDHAR

_______________________
MR. M S VERMA

_________________________
MR. S M BAFNA

_______________________
MR. M M CHITALE

____________________
MR. ADIT JAIN

________________________
MR. PUNEET BHATIA

______________________
MR. RANVIR DEWAN

_________________________________
MR. S VENKATAKRISHNAN

_________________________________
MR. S. LAKSHMINARAYANAN

Place: MUMBAI
Date: May 6, 2010

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