APPLICANT'S UNDERTAKING SHRIRAM TRANSPORT FINANCE COMPANY LIMITED

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in the nature of FORM2A - MEMORANDUM CONTAINING SALIENT FEATURES OF THE PROSPECTUScum Application Form for processing the Bid cum ApplicationForms procured by the Syndicate or Registered Brokers andsubmitted to SCSB.UnderwritingThe Issue has not been underwritten.Details regarding the public issue during the last three yearsby our Company and other listed companies under the samemanagement within the meaning of section 370(1B):Our Company has not made any public or rights or compositeissue of capital during the last three years. There are no listedcompanies under the same management within the meaning ofSection 370(1) (B) of the Companies Act, 1956.Public / Rights IssuesOur Company has not made any public or rights issuances in thelast five years except as follows:Previous Issue: Please refer page 315 to the Prospectus.Commissions and Brokerage on previous issue1. ` 1,237.49 lacs was incurred in the financial year ended March31, 2010 towards commission and brokerage in connection withthe public issue of 9,999,996 secured non convertible debenturesof face value ` 1,000.00 each pursuant to the prospectus datedJuly 16, 2009;2. ` 532.77 lacs was incurred in the financial year ended March31, 2011 towards commission and brokerage in connectionwith the public issue of 4,168,968 secured non convertibledebentures and 8,31,031 unsecured non convertible debenturesof face value ` 1,000.00 each pursuant to the prospectus datedMay 6, 2010; and3. ` 1,335.24 lacs were incurred in the financial year ended March31, 2012 towards commission and brokerage in connection withthe public issue of 9,999,993 secured non convertible debenturesof face value ` 1,000.00 each pursuant to the prospectus datedJune 16, 2011.4. ` 739. 65 lacs was incurred in the financial year ended March31, 2013 towards commission and brokerage in connection withthe public issue of 6,000,000 secured non convertible debenturesof face value ` 1,000.00 each pursuant to the prospectus datedJune 16, 2012.Stock Market Data: Please refer to page 316 of the ProsepctusRevaluation of assets: The Company has not revalued its assetsin the last five years.Mechanism for redressal of investor grievances: The RegistrarAgreement dated June 24, 2013 between the Registrar to theIssue and our Company will provide for retention of recordswith the Registrar to the Issue for a period of at least three yearsfrom the last date of despatch of the Allotment Advice, dematcredit and refund orders to enable the investors to approach theRegistrar to the Issue for redressal of their grievances.All grievances relating to the Issue may be addressed to theRegistrar to the Issue, giving full details such as name, addressof the Applicant, number of NCDs applied for, amount paid onapplication and the bank branch or collection centre where theapplication was submitted. The contact details of Registrar tothe Issue are as follows:Integrated Enterprises (India) Limited2nd Floor, Kences Towers,No1, Ramakrishna Street,North Usman Road, T. Nagar,Chennai - 600 017Tel: + 91 44 2814 0801, +91 44 2814 0802, +91 44 2814 0803Fax: +91 44 2814 2479Email: stfcipo@integratedindia.inInvestor Grievance Email: sureshbabu@integratedindia.inWebsite: www.integratedindia.inContact Person: Ms. Anusha N and Mr. Sriram SCompliance Officer: Mr. Suresh Babu. KSEBI Registration No.: INR000000544We estimate that the average time required by us or the Registrarto the Issue for the redressal of routine investor grievanceswill be 7 (seven) business days from the date of receipt of thecomplaint. In case of non-routine complaints and complaintswhere external agencies are involved, we will seek to redressthese complaints as expeditiously as possible.Mr. Vivek M. Achwal has been appointed as the ComplianceOfficer of our Company for this issue.The contact details of Compliance Officer of our Company areas follows:Mr. Vivek M. Achwal,Wockhardt Towers, Level-3West Wing, C–2, G Block, Bandra – Kurla ComplexBandra (East)Mumbai – 400 051Tel. No. +91 22 4095 9595Fax No.: +91 22 4095 9596/97Email: stfcncd5comp@stfc.inChange in Auditors of our Company during the last threeyears: There has been no change(s) in the Joint StatutoryAuditors of our Company in the last 3 (three) financial yearspreceding the date of the Prospectus.RISK FACTORSAn investment in NCDs involves a certain degree of risk.Prospective investors should carefully consider the risksand uncertainties described below, in addition to the otherinformation contained in the Prospectus before making anyinvestment decision relating to the NCDs. The risk factors setforth below do not purport to be complete or comprehensive interms of all the risk factors that may arise in connection withour business or any decision to purchase, own or dispose of theNCDs. If any of the following risks or other risks that are notcurrently known or are now deemed immaterial, actually occur,our business, financial condition and result of operation couldsuffer, the trading price of the NCDs could decline and youmay lose your all or part of your interest and / or redemptionamounts. Unless otherwise stated in the relevant risk factorsset forth below, we are not in a position to specify or quantifythe financial or other implications of any of the risks mentionedherein. The ordering of the risk factors is intended to facilitateease of reading and reference and does not in any mannerindicate the importance of one risk factor over another.The Prospectus contains forward looking statements thatinvolve risk and uncertainties. Our Company’s actual resultscould differ materially from those anticipated in these forwardlooking statements as a result of several factors, including the40 Shriram Transport Finance Company Limited
in the nature of FORM2A - MEMORANDUM CONTAINING SALIENT FEATURES OF THE PROSPECTUSconsiderations described below and elsewhere in the Prospectus.Unless the context otherwise requires, the financial informationused in this section is derived from and should be read inconjunction with the Reformatted Unconsolidated SummaryFinancial Statements and the Reformatted ConsolidatedSummary Financial Statements of our Company.Investors are advised to read the following risk factors carefullybefore making an investment in the NCDs offered in this Issue.You must rely on your own examination of our Company andthis Issue, including the risks and uncertainties involved.INTERNAL RISK FACTORSRisks relating to our Company and its Business1. Our financial performance is highly sensitive to interest ratevolatility.2. Our business requires raising substantial capital by the wayof borrowing, and any disruption in funding sources wouldhave a material adverse effect on our liquidity, financialcondition and/or cash flows.3. If we are unable to manage the level of NPAs in our loanassets, our financial position, results of operations and cashflows may suffer.4. Our business is focused on commercial vehicle financefor new and pre-owned commercial vehicles and any adversedevelopments in this sector would adversely affect our resultsof operations.5. High levels of customer defaults could adversely affect ourbusiness, financial condition, results of operations and/orcash flows.6. We may not be able to recover, on a timely basis or at all,the full value of collateral or amounts which are sufficient tocover the outstanding amounts due under defaulted loans.7. The Company is involved in certain legal proceedings foralleged contravention of certain State legislations in Indiarelating to “money lending” activities. Any unfavourableoutcome in such proceedings and the imposition of anyadditional restrictive statutory and/or regulatory requirementsmay adversely affect our goodwill, business prospects andresults of operations.8. A large part of our collections are in cash and consequentlywe face the risk of misappropriation or fraud by our employees.9. Our significant indebtedness and the conditions andrestrictions imposed by our financing arrangements couldrestrict our ability to conduct our business and operations inthe manner we desire.10. We have in the past acquired, and may continue to acquirein the future, portfolios relating to various credit and financingfacilities from banks and other institutions on a non-recoursebasis. If the performance of such portfolios deteriorates, ourbusiness, financial condition, results of operations and/orcash flows may be adversely affected11. We face increasing competition in our business whichmay result in declining margins if we are unable to competeeffectively.12. We may not be able to successfully sustain our growthstrategy.13. We may not be able to successfully diversify our productportfolio.14. Our loan portfolio may no longer continue to be classifiedas priority sector advances by the RBI.15. We may experience difficulties in expanding our businessinto new regions and markets in India.16. Any downgrade of our credit ratings would increaseborrowing costs and constrain our access to capital andlending markets and, as a result, would negatively affect ournet interest margin and our business.17. If we are unable to successfully expand, maintain orleverage our partnership arrangements with private financiersinvolved in commercial vehicle financing, our businessprospects, results of operations, financial conditions and/orcash flows may be adversely affected.18. A decline in our capital adequacy ratio could restrict ourfuture business growth.19. As part of our business strategy we assign or securitizea substantial portion of our loan assets to banks andother institutions. Any deterioration in the performance of anypool of receivables assigned or securitized to banks and otherinstitutions may adversely impact our financial performanceand/or cash flows.20. System failures or inadequacy and security breaches incomputer systems may adversely affect our business.21. We may not be able to maintain our current levels ofprofitability due to increased costs or reduced spreads.22. We face asset-liability mismatches which could affect ourliquidity and consequently may adversely affect our operations,profitability and/or cash flows.23. The trade mark/service mark and logo in connectionwith the “Shriram” brand which we use is licensed to usand consequently, any termination or non-renewal of suchlicense may adversely affect our goodwill, operations andprofitability. Further, our current logo which we are usingfor our corporate publicity campaigns and as included in theProspectus is not registered. Our inability to register such logoand/or to adequately protect the same may adversely affect ourgoodwill, operations and profitability.24. We have certain contingent liabilities which may adverselyaffect our financial condition.25. We are involved in various legal and other proceedingsthat if determined against us could have a material adverseeffect on our financial condition and results of operations.26. Inaccurate appraisal of credit may adversely impact ourbusiness.27. We may have to comply with strict regulations andguidelines issued by regulatory authorities in India.28. Our ability to assess, monitor and manage risks inherentin our business differs from the standards of some of ourcounterparts in India and in some developed countries.29. Our Promoter beneficially owns more than 25% of ourequity share capital and accordingly has the ability to exercisesignificant influence over the outcome of matters submitted toshareholders for approval, and their interests may differ fromthose of other holders of Equity Shares.30. We have entered into certain related party transactions.31. Any failure by us to identify, manage, complete andintegrate acquisitions, divestitures and other significantShriram Transport Finance Company Limited41
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APPLICANT'S UNDERTAKING SHRIRAM TRANSPORT FINANCE COMPANY LIMITED

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