KAMDHENU ISPAT LIMITED - Securities and Exchange Board of India

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Strengths · Kamdhenu is using most advanced technology “Tempcore Process” for manufacturing of TMT Bars. · Company’s products meet IS 1786-1985 and ISO 9001:2000 specifications · Kamdhenu is regularly spending reasonable amounts on Brand promotion to create consumer awareness · Professional and experienced manpower material management · We have a stronge net work of 1750 dealers across India. At present company is marketing steel bars, cement, POP, SS Pipes under “Kamdhenu” brand. Weaknesses · Increase in raw material prices and other inputs can affect the business operations adversely · Government intervention through fiscal measures like increase in duties and levies can affect the business operations Opportunities · The concept of appointing Franchise manufacturing units is likely to boost Company’s market share without making investment in setting up of new units Threats · Growth in domestic steel prices is boosted by the users group like builders etc. and the same can prompt the Govt. to take unfavourable action indirectly affecting us. · Market competition from existing similar product manufacturers and new ventures which may be established in future BUSINESS STRATEGY Kamdhenu products have over the years created a niche market in the northern region of India and demand for its products has been growing at rapid pace due to its focus on producing Quality products, thereby satisfying the customers’ need. Company’s brand Kamdhenu has become major brand among the various other Brands available in the country for Steel Bars. Indian economy grew by 6.9% during FY 2005 compared to 8.5% in the previous year. The industrial sector remained buoyant, with output growing at 8.3% as compared to 6.5% in the previous year. Govt. of India is giving priority to infrastructure as well housing sector by making increased budgetary allocation for Roads, Bridges, Power plants, dams, rural housing, etc. All this has resulted in a steady growth in steel consumption in the country. The apparent steel consumption in India grew at the rate of about 5-6% over last decade to a level of about 33 million tonnes in FY 2005. The growth rate is likely to accelerate in future with further increased expenditure on infrastructure and consequent demand effect on steel for both fixed asset investment and consumption. The consumption of steel is expected to increase by about 3 to 4 million tones p.a. for next few years, possibly exceeding 50 million tones by 2010. Keeping the above in view and to take advantage of this scenario, Kamdhenu has taken a conscious decision to develop and enlarge its business operations by adopting Franchise route. Kamdhenu has plans to establish its Stock Yard/marketing offices at various strategic locations and materials required for these yards will be sourced from its Franchisees, who are existing manufacturers of Steel TMT/ CTD Bars. The said Franchise units would be manufacturing the products under Kamdhenu’s strict quality control and would be marketed under brand name of Kamdhenu. Company will derive following benefits of this strategy: 1. Market share of Kamdhenu will go up without investing in manufacturing plants, 2. It would be able to increase its profitability by increased turn-around cycle of available resources. 3. It would be able to derive benefits of handling large volumes. 4. It would be also be entitled to Royalty payments from the Franchisees for use of Kamdhenu’s brand. The Company has ventured into other building materials like Cement, Plaster of Paris, SS Pipes etc. and has established franchisee units for manufacture of these products under “Kamdhenu” brand. CAPACITY UTILIZATION Installed Capacity Bars (M.T./P.A.) 48,000.000 Actual Production Bars (M.T./P.A.) 38634.810 Installed Capacity Ingot (M.T./P.A.) 22,500.000 Actual Production Ingots (M.T./P.A.) 14804.335 INSURANCE The Company has taken various insurance policies. The insurance policies cover Standard Fire and Special Perils Policy, Machinery Break Down Insurance, Money Insurance Electronic Equipment Insurance, Burglary Policy. The Sum Total of the insurance cover is Rs. 10,09,61,500/- (Rupees Ten Crores Nine Lacs Sixty One Thousand & Five Hundred Only). We have also taken key man insurance for some of our whole time directors. We believe that our insurance coverage is adequate as per present requirements of the Company. 52
PROPERTY A. Properties owned by the Company The Company owns Flat No. B- 202, Second Floor, Bhagat Singh Colony, Bhiwadi vide Sale deed dated June 09, 2000 executed by Prism Electronic in favour of the Company Details of Property: Flat No. B- 202, Second Floor, Bhagat Singh Colony, Bhiwadi. Area of the flat- 1600Sq. feet. Seller- Prism Electronics, B- 56/1, Okhla Industrial Area, Phase II, New Delhi B. Intellectual Property Rights We own “Kamdhenu” trade mark in respect of Steel Bars and Cement under class 6 and class 19 respectively of Trade Mark Act 1999. We have also moved application for registration of the Trade mark in respect of various other products mentioned under Class 1 to 42 covering items of Schedule IV of the Trade Mark Act,1999 . The registration is pending with the Registering Authority. The Company is adhering to policy of using the “kamdhenu” brand not only in respect of Steel bars and Cement but also in respect of other Building materials and other products which the Company may deal in the future. C. Properties on Lease. S No. 1. 2. Date & Tenure Lease deed dated February 25, 2000 The term of the lease is ninety nine years beginning from March 31, 1999 The possession of the land has been handed over to the lessee on July 02, 1999 Lease deed dated January 04, 1995 The term of the lease is ninety nine years beginning from Nov 09, 1994 Name & Details of Property Leased Plot No. A-1112, Bhiwadi Industrial Estate, Bhiwadi, Rajasthan. It is a Leasehold property measuring 7338.14 Sq. meters. Plot No. A-1114, Bhiwadi Industrial Estate, Bhiwadi, Rajasthan. It is a Leasehold property measuring. 10,140 sq. m LEASE AGREEMENTS Rent/ amount payable Rent: Rs. 760 p.a. Service charges: Rs. 22,800 Rent: Rs. 450 p.a. Service Charges: Rs. 7500 53 Parties L e s s o r - Rajasthan State Industrial Development and InvestmentCorporation Ltd., Jaipur L e s s e e - Kamdhenu Ispat L i m i t e d , Bhiwadi. L e s s o r - Rajasthan State Industrial Development and InvestmentCorporation Ltd., Jaipur Important Terms and conditions of lease (a) Land shall be used for Construction of an industrial unit for manufacturing purposes (b) Right to lay water drains, sewers and electrical wires is reserved by the lessor (c) The lessor reserves all the rights and title to all mines and minerals in and under the demised premises or any part thereof. (d)The Lessor reserves the right to revise the rate of rent every 5 years (not exceeding 25%) (e) The Lessee is to construct and complete the buildings and put them to use before the expiry of 3 years from the date of possession. (f) The Lessee cannot without prior written permission assign, relinquish, mortgage the premises. And the land cannot be sublet, assigned relinquished in part. (g) Stamp and registration charges shall be paid by the lessee (a) Land shall be used for Construction of an industrial unit for manufacturing purposes (b) Right to lay water drains, conditions regarding payment of rent, payment of
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KAMDHENU ISPAT LIMITED DRAFT PROSPE
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DEFINITIONS AND ABBREVIATIONS Gener
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Abbreviations Abbreviation Full For
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RISK FACTORS An investment in equit
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mentioned under Class 1 to 42 cover
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(b) Any disruption/ discontinuance
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affect our operating results. We ar
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The central and state tax scheme in
Page 17 and 18: SUMMARY The following summary is qu
Page 19 and 20: THE ISSUE Equity Shares offered by
Page 21 and 22: of the Stabilisation Period allot,
Page 23 and 24: For the year ended August March Mar
Page 25 and 26: LEGAL ADVISOR TO THE ISSUE Luthra &
Page 27 and 28: 2. Capital Buildup: The existing sh
Page 29 and 30: B. Promoter Group 1. Saurabh Agarwa
Page 31 and 32: Sl. Name of Date of Consid- No. of
Page 33 and 34: Sl. Name of Date of Consid- No. of
Page 35 and 36: 7. The Pre-issue and Post-issue sha
Page 37 and 38: (b) Our top ten shareholders and sh
Page 39 and 40: OBJECTS OF THE ISSUE The proceeds f
Page 41 and 42: BASIS FOR ISSUE PRICE QUALITATIVE F
Page 43 and 44: STATEMENT OF TAX BENEFITS The Compa
Page 45 and 46: loss, such long -term capital loss
Page 47 and 48: Benefit available to Mutual Funds I
Page 49 and 50: Restrictions in external trade, bot
Page 51 and 52: to compete with the likes of China,
Page 53 and 54: III. Flat Products Flat products in
Page 55 and 56: · In China and other Asian countri
Page 57 and 58: BUSINESS OVERVIEW Kamdhenu Ispat Li
Page 59 and 60: PROCESS PROCESS FLOW CHART FOR PROD
Page 61 and 62: POWER The Company sources Power fro
Page 63 and 64: The sponge iron is one of the raw m
Page 65 and 66: We help them to get right people to
Page 67: 23. A.S. CEMENT INDUSTRIES, Patiala
Page 71 and 72: S No. 6. 7. 8. Date & Tenure Name &
Page 73 and 74: OUR INDEBTEDNESS Sr. No 1 Lender &
Page 75 and 76: Main Objects The main objects of th
Page 77 and 78: OUR MANAGEMENT As per the Articles
Page 79 and 80: C. MR. SUNIL KUMAR AGARWAL Designat
Page 81 and 82: Company Secretary Secretarial & Leg
Page 83 and 84: PROMOTERS OUR PROMOTERS MR. SATISH
Page 85 and 86: 2. and accessories, automobile part
Page 87 and 88: The Board of Directors Kamdhenu Isp
Page 89 and 90: Annexure - II Statement of Assets a
Page 91 and 92: 7 The company is manufacturing CTD/
Page 93 and 94: Annexure - VII Performance Ratios:
Page 95 and 96: Principal Terms of Sanctioned Loans
Page 97 and 98: Financial Statements of Group Compa
Page 99 and 100: The Board of Directors of the Compa
Page 101 and 102: List of Shareholders as on 30.9.200
Page 103 and 104: MANAGEMENT’S DISCUSSION AND ANALY
Page 105 and 106: DEPRECIATION Depreciation on fixed
Page 107 and 108: of excise duty was 8% thereafter up
Page 109 and 110: Administrative and Other Expenses W
Page 111 and 112: Cost Of Goods Traded In The company
Page 113 and 114: Information required as per clause
Page 115 and 116: SL. NO. 5 6 7 8 9 10 11 12 ASSESSME
Page 117 and 118: 3.2 CENTRAL EXCISE Commissioner of
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4.2 M/s. Kamdhenu Ispat Limited vs.
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II Outstanding litigations involvin
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Sales Tax ASSESSMENT YEAR PARTICULA
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11. The Company has obtained consen
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BEHALF AND TOWARDS THIS PURPOSE, TH
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Public Issue expenses are estimated
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ISSUE INFORMATION Terms of the Issu
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Applications by Hindu Undivided Fam
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Payment Instructions 1. Payments sh
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5. Investors can contact the Compli
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for public subscription and the bal
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POWER TO MODIFY RIGHT 11. (i) If at
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without any deduction or allowance
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there be no such Chairman or if at
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69. The Director shall not be requi
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fit and any such appointment may (i
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present and entitled to vote there
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MATERIAL CONTRACTS AND DOCUMENTS FO
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DECLARATION All the relevant provis
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KAMDHENU ISPAT LIMITED - Securities and Exchange Board of India

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