private & confidential for private circulation only) & confidential (for private circulation...
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Private & Confidential (For Private Circulation Only)
Applicant Name ICICI Prudential Mutual Fund
Application form Sr. No.
AXIS FINANCE LIMITED Tranche Disclosure Document dated March 04, 2015
Axis Finance Limited (the “Company or “Issuer” or “AFL”) (was incorporated as M/s Kalpataru Hire Purchase & Leasing Private Limited on 27-04-1995. The Company was later renamed as M/s Enam Finance Private Limited and later to M/s Axis Finance Private Limited vide certificate of incorporation dated 24-June-2008 & 26-03-2013 respectively. The Company was later converted into Public company and to its present name vide a fresh Certificate of Incorporation issued on 10-05-2013.The Corporate Identification Number of the Company is U65921MH1995PLC212675f incorporated in the Republic of India with limited liability under the Companies Act, 1956, as amended (the “Companies Act”)
Registered Office: Ground Floor, Axis House, Wadia International Centre, Pandurang Budhkar Marg, Worli, Mumbai – 400025, Email ID: [email protected]; Website:www.axisfinance.co.in, Tel: 022-24255717 Fax: 022-24255732
Corporate Office: Seventh Floor, Axis House, Wadia International Centre, Pandurang Budhkar Marg, Worli, Mumbai – 400025, Email ID: [email protected]; Website:www.axisfinance.co.in, Tel: 022-24255717 Fax: 022-24255732
Contact Person: Mr. Amith Iyer
Tranche Disclosure Document for issuance of debentures in the nature of secured, redeemable, non-convertible debentures on private placement basis (the “Debentures”), in terms of SEBI (Issue and Listing of Debt Securities) Regulations 2008 as amended from time to time for an amount not exceeding Rs. 15 crores (Rupees Fifteen crores) to be issued in one or more tranches from time to time (the “Issue”) (hereinafter referred to as “the Document”). This Information Memorandum or Tranche Disclosure Document should be read together with the Shelf Disclosure Document dated November 18, 2014.
GENERAL RISK Investors are advised to read the Risk Factors carefully before taking an investment decision in this offering. For taking an investment decision, the Investors must rely on their own examination of the Issuer and the offer/Issue including the risks involved. The offer/Issue being made on private placement basis, this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer has not been filed with the Securities & Exchange Board of India (SEBI). The Debentures have not been recommended or approved by SEBI nor does SEBI guarantee the accuracy or adequacy of this document. Specific attention of the Investors is invited to the summarized and detailed Risk Factors mentioned elsewhere in this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer. The submission of this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer to the stock exchange should not in any way be deemed or construed to mean that this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer has been reviewed, cleared or approved by the stock exchange; nor does the stock exchange in any manner warrant, certify, or endorse the correctness or completeness of any of the contents of this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer.
ISSUER’S ABSOLUTE RESPONSIBILITYThe Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer 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 Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer 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 document as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.
TRANCHE INFORMATION MEMORANDUM TRANCHE INFORMATION MEMORANDUM / TRANCHE DISCLOSURE DOCUMENT/ TRANCHE LETTER OF OFFER FOR ISSUE BY WAY OF PRIVATE PLACEMENT OF SECURED UNLISTED FULLY REDEEMABLE NON-CONVERTIBLE DEBT IN THE NATURE OF DEBENTURES FOR CASH AGGREGATING UPTO RS. 150,000,000 (RUPEES FIFTEEN CRORES ONLY).
CREDIT RATINGThe NCDs are rated by M/s India Ratings & Research Private Limited. The NCDs are rated “IND AAA”. Instruments with this
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rating are considered to have the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk.
Please note that the rating is not a recommendation to buy, sell or hold securities and investors should take their own decision. The rating may be subject to revision or withdrawal at any time by the assigning rating agency and each rating should be evaluated independently of any other rating. The rating obtained is subject to revision at any point of time in the future. The rating agencies have a right to suspend, withdraw the rating at any time on the basis of new information.
LISTING Secured Fully Redeemable Non-Convertible Debentures offered for subscription through this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer and to be issued under a debenture trust agreement. The Debentures shall be listed subsequently and the relevant compliances in relation to listing of the debentures shall be complied with at the time of listing of the Debentures.
ISSUE PROGRAMME Issue Opens on: 5th March 2015 Issue Closes on: 5th March 2015 Pay-in Date: 5th March 2015 Deemed Date of Allotment: 5th March 2015
ISSUER DEBENTURE TRUSTEE
Axis Finance Limited GDA Trusteeship LimitedRegd Office: Ground Floor, Axis House, Wadia International Centre, Pandurang Budhkar Marg, Worli, Mumbai – 400025
Office: GDA Trusteeship Limited Office No. 1,2 & 3, 4th Floor, Rahimtoola House, 7, Homji Street, Fort, Mumbai- 400 001
Tel: 022-24255717 Tel : 022-49220555 Fax: 022-24255732 Fax : 022-49220505 Email: [email protected] Contact Person: Mr. Rajneesh Kumar
Email: [email protected] Contact Person: Ms. Sarita Iyer
NOTE: This Tranche Information Memorandum / Tranche Disclosure Document of private placement is neither a prospectus nor a statement in lieu of a prospectus. This is only an information brochure intended for private use and should not be construed to be a prospectus and/or an invitation to the public for subscription to Debentures under any law for the time being in force. The Company can, at its sole and absolute discretion change the terms of the offer. The Company reserves the right to close, recall, extend or modify the terms of the Issue at its absolute discretion at any time prior to Allotment. This Tranche Information Memorandum or Tranche Disclosure Document should be read together with the Shelf Disclosure Document dated November 18, 2014.
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TABLE OF CONTENTS
DEFINITIONS AND ABBREVIATIONS ............................................................................................................ 1
DISCLAIMER .......................................................................................................................................................... 5
CONFIDENTIALITY ............................................................................................................................................. 8
RISK FACTORS ...................................................................................................................................................... 9
GENERAL INFORMATION ............................................................................................................................... 14
MATERIAL DOCUMENTS ................................................................................................................................ 51
GENERAL DISCLAIMER ................................................................................................................................... 52
DECLARATION: .................................................................................................................................................. 54
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DEFINITIONS AND ABBREVIATIONS This Tranche Disclosure Document uses certain definitions and abbreviations which, unless the context indicates or implies otherwise, have the meaning as provided below. References to any legislation, act or regulation shall be to such term as amended from time to time. Definitions
Term Description
Company/Issuer Axis Finance Limited, a company with its registered office at Ground Floor, Axis House, Wadia International Centre, Pandurang Budhkar Marg, Worli, Mumbai – 400025.
“we”, “us”, “our” Unless the context otherwise requires, the Company. Account Bank account number 913020023692270 of the Issuer opened and maintained
with the Axis Bank Limited. Affiliate A Person that controls, is controlled by or is under the common control with
such part in relation to any party. Application Form The form in which an investor can apply for subscription to the Debentures. Applicable Law Any statute, law, regulation, ordinance, rule, judgment, rule of law, order,
decree, clearance, authorization, approval, directive, guideline, policy, requirement, or governmental restriction having the force of law, or any determination by, or any interpretation or administration of any of the foregoing by, any statutory or judicial or regulatory authority, in any relevant jurisdiction, whether in effect as of the date of this Agreement or thereafter and in each case as amended.
Allotment Advice An advice informing the allottee of the number of Debenture(s) allotted in Electronic (dematerialised) Form.
Allot/Allotment/Allotted Unless the context otherwise requires or implies, the allotment of the Debentures pursuant to the Issue.
Articles Articles of Association of the Company. Board Board of Directors of the Company or a Committee thereof. CDSL Central Depository Services (India) Limited. Companies Act The applicable provisions of Companies Act, 1956 and Companies Act, 2013
as the case may be. Credit Rating Agency India Ratings & Research Private LimitedDebentures/NCDs As the subject or context may require, Debentures having an aggregate
nominal value of up to Rs. 150,000,000 (Rupees Fifteen Crores only). Debenture Documents All the documents, deeds, undertakings executed, to be executed by the
Company or any other Person in connection with the bonds, debentures issued, to be issued to the Investors including but not limited to the Debenture Trust Deed, Debenture Trustee Agreement and this Information Memorandum/ Disclosure Letter etc.
Debenture Trustee Trustee for the Debenture Holders, in this case for the time being GDA Trusteeship Limited.
Debenture Trustee Agreement The document titled 'Debenture Trustee Agreement' dated November 17, 2014 entered into/ to be entered into inter alia between the Issuer and the Debenture Trustee for the appointment of the Debenture Trustee.
Debenture Trust Deed The document titled 'Debenture Trust Deed' to be executed between the Debenture Trustee and the Issuer for inter alia settling a trust, creation of mortgage and describing the powers of the Debenture Trustee, read with any amendments or supplements thereto.
Deterioration of Creditworthiness
The occurrence of any one or more of the following events: (a) inclusion of the Company and/or any of its Directors in Reserve Bank of India's wilful defaulters list and the same is not cured within period of 30 (thirty) days from the date of such inclusion in the Reserve Bank of India's wilful defaulters list ; (b) any materially adverse comment from the statutory auditor of the Company in its report; (c) downgrade in the credit rating of the Company below the investment grade as determined by the external credit rating agency; and (d) failure of the Company to comply with the material terms and conditions of
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Term Description
the Debenture Documents. Depository A depository registered with SEBI under the SEBI (Depositories and
Participants) Regulations, 1996, as amended from time to time. Depository Participant A participant as defined under the Depositories Act, 1996, as amended from
time to time. Finance Parties Debenture Holders and the Debenture Trustee including their agents and other
Persons as notified by them from time to time. A Finance Party shall mean any of them as the context may permit or require.
Fiscal Quarter In any fiscal year i.e., the accounting period commencing from April 1st of each year till March 31st of next year, any of the following three month periods of a fiscal year: (a) April 1 to June 30; (b) July 1 to September 30; (c) October 1 to December 31; and (d) January 1 to March 31.
Government Entity
Government of India, or the government of any other State of India or any ministry, department, local authority, board, statutory or regulatory authority, instrumentality, agency, corporation (to the extent acting in a legislative, judicial or administrative capacity and not as a contracting party with the Company) or commission under the direct or indirect control of the Government of India or any subdivision of any of them or owned or controlled by the Government of India, or the government of any other State of India or any of their subdivisions, or any court, tribunal or judicial body within India.
Indebtedness Any indebtedness whatsoever of the Company at any time for or in respect of monies borrowed, contracted or raised (whether or not for cash consideration) or liabilities contracted by whatever means (including under guarantees, indemnities, acceptance, credits, deposits, hire-purchase and leasing).
Investors / Debenture Holders Persons who are specifically requested by the Issuer to subscribe to the Debentures in terms of the Debenture Documents and are accordingly allotted the Debentures and shall include the transferees of such Debentures.
IT Act The Income Tax Act, 1961 as amended from time to time. Tranche Information Memorandum / Tranche Disclosure Document/ Tranche Letter of Offer
This Tranche Information Memorandum or Tranche Disclosure Document dated March 04, 2015 through which the Debentures are being offered on a private placement basis. This Tranche Information Memorandum or Tranche Disclosure Document should be read together with the Shelf Disclosure Document dated November 18, 2014.
Issue Issue of the Debentures on a private placement basis. Liquidated Damages Interest payable at the rate of two percent (2%) per annum over and above the
Applicable Interest Rate on the defaulted amounts payable by the Company under the Debenture Documents.
Majority Debenture Holders Such of the Investors / Debenture Holders who represent not less than three fourths of the aggregate of the Principal Amounts outstanding from time to time.
Memorandum / MoA Memorandum of Association of the Company. NBFC ‘Non Banking Financial Company’ as defined under the Reserve Bank of
India Act, 1934 NEFT National Electronic Fund Transfer system, a nation-wide payment system
facilitating one-to-one funds transfer. Outstanding Amounts or Outstandings
All amounts payable by the Obligors to such Debenture Holders pursuant to the terms contained herein and the other Debenture Documents; including without limitation: (a) all amounts payable by the Company to the Debenture Holders including all interest, all fees, commissions, charges, and amounts arising out of indemnities, incurred under, arising out of or in connection with any Debenture Document; (b) any and all sums advanced by such Debenture Holder in order to preserve the Security or preserve its Security Interest in the Security; and (c) in the event of any proceeding for the collection or enforcement of the Outstandings, after an event of default shall have occurred
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Term Description
and be continuing, the expenses of retaking, holding, preparing for sale or lease, selling or otherwise disposing of or realising the Security, or of any exercise by the Debenture Holders of its/their right(s) under the Security Documents and/or the other Debenture Documents, together with legal fees and court costs.
Person An individual, corporation, partnership, joint venture, association of persons, trust, unincorporated organisation, government (central, state or otherwise), sovereign state, or any agency, department, authority or political subdivision thereof, international organisation, agency or authority (in each case, whether or not having separate legal personality) and shall include their respective successors and assigns and in case of an individual shall include his legal representatives, administrators, executors and heirs and in case of a trust shall include the trustee or the trustees for the time being.
Principal Amount In relation to the Debentures, on any particular date, the principal amount of the outstandings of Debentures on such date.
RBI The Reserve Bank of India. Record Date (Fifteen) calendar days prior to each Interest Payment Date, or the Redemption
Date for determining the beneficiaries of the Debentures for the interest payment and/or principal repayment.
Redemption Date/Repayment Date
In relation to the Debentures, the respective dates specified in the terms of issue on which the said Debentures are redeemed in accordance with the terms of the Debenture Documents.
ROC/Registrar of Companies The Registrar of Companies, Maharashtra, Mumbai. Rs./Rupees/INR Indian Rupees.
RTGS Real Time Gross Settlement, an electronic funds transfer facility provided by
RBI.SEBI Securities and Exchange Board of India constituted under the Securities and
Exchange Board of India Act, 1992, as amended from time to time. Secured Assets The assets forming a part of the security for the Debentures under the Security
Documents, from time to time. Security Documents The documents entered into/ to be entered into in relation to the creation of the
Security Interest for securing the amounts payable in relation to the Debentures to be issued in tranches pursuant to the Tranche Information Memorandum/ Tranche Disclosure Document of the respective tranches.
Security Interest Any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), preference, priority or other security agreement of any kind or nature whatsoever including, without limitation, (i) any conditional sale or other title retention agreement, any financing or similar statement or notice filed under any recording or notice statute, and any lease having substantially the same effect as any of the foregoing, and (ii) any designation of loss payees or beneficiaries or any similar arrangement under any insurance contract, policy etc.
Tranche Issue Shall mean Debentures will be issued in one or more tranches subject to the overall Issue limit as covered under this Document and will be offered in by way of subsequent Tranche Documents prescribing the respective conditions applicable to such Tranche Issue.
Tranche Document(s) Tranche Document shall mean the respective disclosure document that shall prescribe the terms and conditions as may be applicable to a particular Tranche Issue
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Abbreviations
Term Description
“Issuer”, “AFL”, “our Company” or “the Company”
Axis Finance Limited
“We” or “us”, “our” or the “Group”
Axis Finance Limited and its subsidiaries, joint ventures and associates
AMC Asset Management CompanyCC Cash CreditCDSL Central Depository Services (India) LimitedCFO Chief Financial OfficerDIN Director Identification NumberDP Depository Participant as defined under the Depositories Act, 1996 DRR Debenture Redemption ReserveESOP Employees Stock OptionFCNR Foreign Currency Non ResidentFY Period of 12 months ended March 31 of that particular year HUF Hindu Undivided FamilyIndia Ratings India Ratings and Research Private LimitedNCD Non Convertible DebenturesNEFT National Electronic Fund TransferNRI Non Resident IndianNPA Non Performing AssetNSDL National Securities Depositories LimitedRBI Reserve Bank of IndiaRTGS Real Time Gross SettlementSEBI Securities and Exchange Board of IndiaWCDL Working Capital Demand LoanWDM Wholesale Debt Market
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DISCLAIMER This Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document is strictly for private placement and is only an information brochure intended for private use. Nothing in this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document shall constitute and/or deem to constitute an offer or an invitation to an offer to the Indian public or any section thereof to subscribe for or otherwise acquire the Debentures in general. This Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document should not be construed to be a prospectus or a statement in lieu of prospectus under the Companies Act. This Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document and the contents hereof are restricted for only the intended recipient(s) who have been addressed directly and specifically through a communication by the Company and only such recipients are eligible to apply for the Debentures. All investors are required to comply with the relevant regulations/guidelines applicable to them for investing in this Issue. Further, since the Issue is being made on a private placement basis, a copy of this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document has not been filed with the SEBI or any stock exchanges. Therefore, as per the applicable provisions of law, copy of this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document has not been filed or submitted to the SEBI or any stock exchanges for its review and/or approval. The document is for the exclusive use of the investors to whom it is delivered and it should not be circulated or distributed to third party(ies). The Company certifies that the disclosures made in this document are adequate and are true and correct and are adequate to facilitate investors to take an informed decision for making investment in this Issue. This Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document and the contents hereof are restricted for only the intended recipient(s) who have been addressed directly and specifically through a communication by the Company and only such recipients are eligible to apply for the Debentures. Disclaimer of the Debenture Trustee The role of the Debenture Trustee in the assignment is confined to acting as a trustee for holding security and various other rights of the investors. The Debenture Trustee has neither scrutinized nor vetted nor has it done any due-diligence for verification of the contents of this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document. It is to be distinctly understood that the use of this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document by the Debenture Trustee should not in any way be deemed or construed to mean that this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document has been prepared, cleared, approved or vetted by it; nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document. Disclaimer in respect of Jurisdiction This Issue is made in India to investors to who this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document has been specifically provided. This Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document does not constitute an offer to sell or an invitation to subscribe to Debentures offered hereby to any person to whom it is not specifically addressed. Any disputes arising out of this Issue will be subject to the exclusive jurisdiction of the courts of Mumbai, at the discretion of the Debenture Holders. This Issue is made in India to persons resident in India. This Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document does not constitute an offer to sell or an invitation to subscribe to the Debentures herein, in any other jurisdiction to any person to whom it is unlawful to make an offer or invitation in such jurisdiction.
Disclaimer of the Arranger The Company reserves the right to appoint arranger(s) in the Tranche Issue(s) or may choose to launch a Tranche Issue(s) directly.
It is advised that the Issuer has exercised self due diligence to ensure complete compliance of prescribed disclosure norms etc. in this Tranche Information Memorandum/ Tranche Disclosure Document. The role of the Arranger in the assignment is confined to marketing and placement of the Debentures on the basis of this
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Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer as prepared by the Issuer. The Arranger has neither scrutinized/vetted nor have they done any due-diligence for verification of the contents of this Tranche Information Memorandum/ Tranche Disclosure Document. Accordingly, no representation, warranty or undertaking (express or implied) is made and no responsibility is accepted by the Arranger or any of their officers as to the adequacy, completeness or reasonableness of the information contained herein or of any further information, statement, notice, opinion, memorandum, expression or forecast made or supplied at any time in relation thereto. The Arranger shall use this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer for the purpose of soliciting subscription from eligible investors for the Debentures to be issued by the Issuer on a private placement basis. It is to be distinctly understood that the aforesaid use of this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer by the Arranger should not in any way be deemed or construed that the Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer has been prepared, cleared, approved or vetted by the Arranger; nor do they in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this Tranche Information Memorandum/ Tranche Disclosure Document; nor do they take responsibility for the financial or other soundness of this Issuer, its Affiliates, its management or any scheme or project of the Issuer. The Arranger or any of their directors, employees, Affiliates or representatives do not accept any responsibility and/or liability for any loss or damage arising of whatever nature and extent in connection with the use of any of the information contained in this Tranche Information Memorandum/ Tranche Disclosure Document.
Please note that:
(A) The Arranger and/or their Affiliates may, now and/or in the future, have other investment and
commercial banking, trust and other relationships with the Issuer and with other persons ("Other Persons");
(B) As a result of those other relationships, the Arranger and/or their Affiliates may get information about
Other Persons, the Issuer and/or the Issue or that may be relevant to any of them. Despite this, the Arranger and/or their Affiliates will not be required to disclose such information, or the fact that it is in possession of such information, to any recipient of this Tranche Information Memorandum/ Tranche Disclosure Document;
(C) The Arranger and/or their Affiliates may, now and in the future, have fiduciary or other relationships
under which it, or they, may exercise voting power over securities of various persons. Those securities may, from time to time, include Debentures of the Issuer; and
(D) Each of the Arranger and/or their Affiliates may exercise such voting powers, and otherwise perform
its functions in connection with such fiduciary or other relationships, without regard to its relationship to the Issuer and/or the Debentures.
Disclaimer of the Reserve Bank of India
The Debentures have not been recommended or approved by the RBI nor does RBI guarantee the accuracy or adequacy of this document. It is to be distinctly understood that this document should not, in any way, be deemed or construed that the Debentures have been recommended for investment by the RBI. RBI does not take any responsibility either for the financial soundness of the Issuer, or the Debentures being issued by the Issuer or for the correctness of the statements made or opinions expressed in this document. Potential investors may make investment decision in the Debentures offered in terms of this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer solely on the basis of their own analysis and RBI does not accept any responsibility about servicing/repayment of such investment. 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 expressed by the Company and for discharge of liability by the Company.
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Neither is there any provision in law to keep, nor does the Company keep any part of the deposits with the RBI and by issuing the Certificate of Registration to the Company, the Reserve Bank nether accepts any responsibility nor guarantee for the payment of the deposit amount to any depositor.
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CONFIDENTIALITY THE INFORMATION AND DATA CONTAINED HEREIN IS SUBMITTED TO EACH RECIPIENT OF THIS TRANCHE INFORMATION MEMORANDUM/ TRANCHE DISCLOSURE DOCUMENT/ TRANCHE LETTER OF OFFER ON A STRICTLY PRIVATE AND CONFIDENTIAL BASIS. BY ACCEPTING A COPY OF THIS TRANCHE INFORMATION MEMORANDUM/ TRANCHE DISCLOSURE DOCUMENT, EACH RECIPIENT AGREES THAT NEITHER IT NOR ANY OF ITS EMPLOYEES OR ADVISORS WILL USE THE INFORMATION CONTAINED HEREIN FOR ANY PURPOSE OTHER THAN EVALUATING THE SPECIFIC TRANSACTION DESCRIBED HEREIN OR WILL DIVULGE TO ANY OTHER PARTY ANY SUCH INFORMATION. THIS TRANCHE INFORMATION MEMORANDUM/ TRANCHE DISCLOSURE DOCUMENT/ TRANCHE LETTER OF OFFER MUST NOT BE PHOTOCOPIED, REPRODUCED, EXTRACTED OR DISTRIBUTED IN FULL OR IN PART TO ANY PERSON OTHER THAN THE RECIPIENT WITHOUT THE PRIOR WRITTEN CONSENT OF THE ISSUER.
LIMITS ON DISTRIBUTION
THE DISTRIBUTION OF THE TRANCHE INFORMATION MEMORANDUM/ TRANCHE DISCLOSURE DOCUMENT/ TRANCHE LETTER OF OFFER IN CERTAIN JURISDICTIONS MAY BE PROHIBITED BY LAW. RECIPIENTS ARE REQUIRED TO OBSERVE SUCH RESTRICTIONS AND THE COMPANY OR ITS RESPECTIVE AFFILLIATES ACCEPT NO LIABILITY TO ANY PERSON IN RELATION TO THE DISTRIBUTION OF INFORMATION IN ANY JURISDICTION.
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RISK FACTORS Every business carries inherent risks and uncertainties that can affect financial conditions, results of operations and prospects. Investors should carefully consider all the information in this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document, including the risks and uncertainties described below, as well as the financial statements contained in this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document, before making an investment in the Debentures. The Company believes that the following risk factors may affect its ability to fulfil its obligations under the Debentures issued under the Debenture Documents. All of these factors are contingencies which may or may not occur and the Company is not in a position to express a view on the likelihood of any such contingency occurring.
The financial and other related implications of risks concerned, wherever quantifiable, have been disclosed in the risk factors mentioned below. However, there are certain risk factors where such implications are not quantifiable and hence any quantification of the underlying risks has not been disclosed in such risk factors. You should not invest in the Issue unless you are prepared to accept the risk of losing all or part of your investment, and you should consult your own tax, financial and legal advisors about the particular consequences of an investment in the Debentures. Unless otherwise stated, our financial information used in this section is derived from our audited unconsolidated financial information, prepared in accordance with accounting standards generally accepted in India.
Risks relating to the Issue:
The following are some of the risks envisaged by the Issuer’s management. Investors should consider the same carefully for evaluating the Issuer and its business before making any investment decision. Unless the context requires otherwise, the risk factors described below apply to the Issuer only. If any one of the risks occur, the Company’s business, financial conditions and results of operations could suffer and therefore the value of the Issuer’s securities could decline.
The Company believes that the factors described below represent the principal risks inherent in investing in the Debentures issued under this Tranche Letter of Offer/ Tranche Information Memorandum/ Tranche Disclosure Document, but the inability of the Issuer, as the case may be, to pay necessary amounts, on or in connection with any Debentures may occur for other reasons and the Issuer does not represent that the statements below regarding the risks of holding any Debentures are exhaustive. Investors should also read the detailed information set out elsewhere in this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer and reach their own views prior to making any investment decision.
Risks relating to the Company
1. Interest Rate Risk
The Company’s business is largely dependent on interest income from its operations. The Company is exposed to interest rate risk principally as a result of lending to customers at interest rates and in amounts and for periods, which may differ from its funding sources (institutional / bank borrowings and debt offerings). The Company seeks to match its interest rate positions to minimize interest rate risk. Despite these efforts, there can be no assurance that significant interest rate movements will not have an effect on its results of operations. Interest rates are highly sensitive to many factors beyond its control, including the monetary policies of the RBI, deregulation of the financial sector in India, domestic and international economic and political conditions, inflation and other factors. Due to these factors interest rates in India have historically experienced a relatively high degree of volatility. Nevertheless the endeavor of the Company will be to keep the interest rate risk at minimum levels by proactively synchronizing resource securing and lending activities on an ongoing basis.
2. Access to Capital Markets and Commercial Borrowings
The Company’s growth will depend on its continued ability to access funds at competitive rates. With the growth of its business, the Company is increasingly reliant on funding from the debt capital markets and commercial borrowings. The market for such funds is competitive and its ability to obtain funds at competitive rates will depend on various factors, including its ability to maintain its credit ratings. While its borrowing costs have been competitive in the past due to its credit rating and the quality of its asset portfolio, if the Company is unable to access funds at an effective cost that is comparable to or
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lower than its competitors, the Company may not be able to offer competitive interest rates for its loans. This may adversely impact its business and its future financial performance. The value of its collateral may decrease or the Company may experience delays in enforcing its collateral when its customers default on their obligations, which may result in failure to recover the expected value of collateral and adversely affect its financial performance.
The developments in the international markets affect the Indian economy including the financial liquidity position. Our Company is exposed to the risk of liquidity in the financial markets. Changes in economic and financial conditions could make it difficult for the Company to access funds at competitive rates. Being an NBFC, we also face certain restrictions to raise money from international markets which are relatively cheaper sources of money and this further constrains our ability to raise cheaper funds.
3. Failure to recover the expected value of collateral when borrowers default on their obligations to
Company may adversely affect its financial performance.
The Company cannot guarantee that it will be able to realize the full value of its collateral, due to, among other things, defects in the perfection of collateral, delays on its part in taking immediate action in bankruptcy foreclosure proceedings, stock market downturns, claims of other lenders, legal or judicial restraint and fraudulent transfers by borrowers. In the event a specialized regulatory agency gains jurisdiction over the borrower, creditor actions can be further delayed. In addition, to put in place an institutional mechanism for the timely and transparent restructuring of corporate debt, the RBI has devised a corporate debt restructuring system. Any failure to recover the expected value of collateral security could expose the Company to a potential loss. Apart from the RBI guidelines, the Company may be a part of a syndicate of lenders, the majority of whom elect to pursue a different course of action than the Company would have chosen. Any such unexpected loss could adversely affect business, prospects, results of operations and financial condition.
4. Asset-Liability mismatches in the short term, which could affect company’s liquidity position.
The difference between the value of assets and liabilities maturing in any time period category provides the measure to which we are exposed to the liquidity risk. As is typical for several NBFCs, a portion of our funding requirements is met through short-term funding sources, i.e. working capital demand loans, cash credit, short term loans and commercial papers. However, some portion of our assets has medium or long-term maturities. As the Company grows its business, the proportion of medium and long-term assets in the portfolio is expected to grow. In the event that the existing and committed credit facilities are withdrawn or are not available to the Company, funding mismatches may be created and it could have an adverse effect on our business and our future financial performance.
5. Our inability to control the number and value of NPAs in our portfolio could adversely affect our
business and results of operations.
The Company’s inability to control or reduce the number and value of its NPAs may lead to deterioration of the quality of its loan portfolio and may severely impact its business. While the Company’s total provisioning against the NPAs at present may be adequate to cover all the identified losses in our loan portfolio, there may not be any assurance that in future the provisioning, though compliant with regulatory requirements, will be sufficient to cover all anticipated losses. Further, the Company may not be able to meet its recovery targets set for the particular financial year due to the intense competition witnessed at both global and domestic levels. In such circumstances, there could be an increase in the number and value of NPAs which can impact the Company.
6. System failures, infrastructure bottlenecks and security breaches in computer systems may adversely
affect our business.
Our businesses are highly dependent on our ability to process, on a daily basis, a large number of increasingly complex 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. 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,
11
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.
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.
7. Our indebtedness and restrictive covenants imposed by our financing agreements could restrict our
ability to conduct our business and operations.
Our financing agreements require us to maintain certain security margins. Should we breach any financial or other covenants contained in any of our financing agreements, we may be required to immediately repay our borrowings either in whole or in part, together with any related costs. Under the terms of some of the credit lines, the Company is required to obtain the prior written consent of the concerned lender prior to the Company entering into any scheme of expansion, merger, amalgamation, compromise or reconstruction or selling, leasing, transferring all or a substantial portion of its fixed and other assets; making any change in ownership or control or constitution of our Company, or in the shareholding or management or majority of directors, or in the nature of business of our Company; or making amendments in the Company‟s Memorandum and Articles of Association. This may restrict/ delay some of the actions / initiatives that our Company may like to take from time to time.
8. We may not get the benefits of being Axis Group Company in case of any change of control.
In case of any change of control due to any event such as transfer of shares by our Promoter, preferential allotment to any investor, our ability to leverage the “AXIS” brand may get affected and the benefits of being an AXIS company including leveraging of business from other AXIS companies may not be available to us and consequently, could adversely impact our business operations and profitability.
9. We are exposed to various operational risks including the risk of fraud and other misconduct by
employees or outsiders.
Like other financial intermediaries, we are also exposed to various operational risks which include the risk of fraud or misconduct by our employees or even an outsider, unauthorized transactions by employees or third parties, misreporting and non-compliance of various statutory and legal requirements and operational errors. It may not be always possible to deter employees from the misconduct or the precautions we take to detect and prevent these activities may not be effective in all cases. Any such instances of employee misconduct or fraud, the improper use or disclosure of confidential information, could result in regulatory and legal proceedings and may harm our reputation and also our operations.
10. We may not be able to attract or retain talented professionals required for our business.
The complexity of our business operations requires highly skilled and experienced manpower. Such highly skilled personnel give us a competitive edge. Further the successful implementation of our growth plans would largely depend on the availability of such skilled manpower and our ability to attract such qualified manpower. We may lose many business opportunities and our business would suffer if such required manpower is not available on time. Though we have appropriate human resource policies in place, we may face the risk of losing our key management personnel due to reasons beyond our control and we may not be able to replace them in a satisfactory and timely manner which may adversely affect our business and our future financial performance.
11. The Company faces increasing competition from established banks and NBFCs. The successful
implementation of our growth plans depends on our ability to face the competition.
The Company’s main competitors are established commercial banks and NBFCs. Over the past few years, the financing area has seen the entry of banks, both nationalized as well as foreign. Banks have access to low cost funds which enables them to enjoy higher margins and / or offer finance at lower
12
rates. NBFCs do not have access to large quantities of low cost deposits, a factor which can render them less competitive. The Company also faces increased competition from new NBFC‟s foraying into this space and some of which have been quite aggressive in their pricing to garner market share.
12. We may have a high concentration of loans to certain customers or group of customers. If a substantial
portion of these loans becomes non-performing, our business and financial performance could be affected.
Our business of lending with or without securities exposes us to the risk of third parties that owe us money. Our loan portfolio and non-performing asset portfolio has, or may in the future, have a high concentration in certain customers or groups of customers. These parties may default on their obligations to us due to bankruptcy, lack of liquidity, operational failure, breach of contract, government or other regulatory intervention and other reasons including inability to adapt to changes in the macro business environment. Historically, borrowers or borrower groups have been adversely affected by economic conditions in varying degrees. Credit losses due to financial difficulties of these borrowers / borrower groups in the future could adversely affect our business and our financial performance.
Risks Relating to the Utilization of Issue Proceeds
13. Our management will have significant flexibility in applying proceeds 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 activities, including but not restricted to, lending and investments, to repay our existing loans, our business operations including capital expenditure and working capital requirements.
The Main Objects clause of the Memorandum of Association of the Company permits the Company to undertake the activities for which the funds are being raised through the present Issue and also the activities which the Company has been carrying on till date.
The management of the 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, the 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.
Further as per the provisions of the SEBI (Issue and Listing of Debt Securities) Regulations, 2008, we are not required to appoint a monitoring agency and therefore no monitoring agency has been appointed for this Issue.
Risks Relating to the Debentures
14. Changes in general interest rates in the economy may affect the price of our Debentures.
All securities where a fixed rate of interest is offered, such as our Debentures, 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 Debentures.
15. We are not required to maintain any Debenture Redemption Reserve (DRR) for the Debentures issued
under this Tranche Disclosure Document.
No Debenture Redemption Reserve is being created for the issue of NCDs in pursuance of this Document since creation of Debenture Redemption Reserve is not required for the proposed issue of Debentures by the Issuer as per Rule 18(7) of the Companies (Share Capital & Debentures) Rules 2014, as they are privately placed debentures issued by a non banking financial company .
13
16. Any downgrading in credit rating of our Debentures may affect the value of Debentures and thus our
ability to raise further debts.
The NCDs are rated by M/s India Ratings & Research Private Limited. The NCDs are rated “IND AAA”. Instruments with this rating are considered to have the highest degree of safety regarding timely servicing of financial obligations. The Issuer cannot guarantee that the rating will not be downgraded. Such a downgrade in the above credit rating may lower the value of the NCDs and may also affect the Issuer’s ability to raise further debt.
EXTERNAL RISK FACTORS
17. 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 / swine flu. The extent and severity of these natural disasters and pandemics determines their impact on these economies and in turn affects the financial services sector of which our Company is a part. Prolonged spells of abnormal rainfall and other natural calamities could have an adverse impact on the economies in which we have operations, which could adversely affect our business and the price of our Debentures.
18. We are subject to regulatory and legal risk which may adversely affect our business.
The operations of an NBFC are subject to regulations framed by the RBI and other authorities including regulations relating to foreign investment in India. The Company is required to maintain a CRAR of 15% from March 31, 2011, besides complying with other prudential norms.
We are also subject to changes in Indian laws, regulations and accounting principles. 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 affect our business and future financial performance.
19. 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 financing and the interest rates and other commercial terms at which such additional financing is available. This could have an adverse effect on our financial performance and our ability to obtain financing to fund our growth on favourable terms, or at all.
20. Civil unrest, terrorist attacks and war could 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 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 market for securities including the Debentures. The consequences of any armed conflicts are unpredictable, and we may not be able to foresee events that could have an adverse effect on our business and the price and yield of the Debentures.
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GENERAL INFORMATION
A. Issuer Information
(a) Name and address of the following: (i) Registered office of the Company:
Ground Floor, Axis House, Wadia International Centre, Pandurang Budhkar Marg, Worli, Mumbai – 400025
(ii) Corporate office of the Company:
Seventh Floor, Axis House, Wadia International Centre, Pandurang Budhkar Marg, Worli, Mumbai – 400025
(b) Company Registration No.: U65921MH1995PLC212675
(i) Compliance officer of the Company:
Rajneesh Kumar, Deputy Vice President and Company Secretary Tel: +91-22-2425 5726 Fax: +91-22-2425 5732 Email: [email protected]
(ii) Chief Finance Officer of the Company: Mr. Amith Iyer,Vice President and Chief Financial Officer Tel: +91-22-2425 5730, Fax: +91-22-2425 5732 Email: [email protected]
(iii) Arranger, if any, of the Issue:
ICAP India Private Limited Laxmi Towers C Wing, 3rd Floor BKC,Mumbai 400051 Tel No : +91 22 61179105
(iv) Trustee of the Issue:
GDA Trusteeship Limited, Office No 1,2 and 3, 4th Floor, Rahimtoola House, 7, Homji Street, Fort, Mumbai- 400 001
(v) Registrar of the issue:
Link Intime India Private Limited C-13, Pannalal Silk Mills Compound, LBS Marg, Bhandup –West Mumbai-400 078
(vi) Credit Rating Agency of the Issue:
India Ratings and Research Private Limited Wockhardt Towers, 4th Floor, BandraKurla Complex, Bandra (East), Mumbai – 400 051
(vii) Auditors of the Company:
S.R.Batliboi & Co. LLP 14th Floor, The Ruby,29 Senapati Bapat Marg, Dadar (west), Mumbai – 400028
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B. Brief summary of the business/activities of the Issuer and its line of business: Business Overview and Corporate Structure Axis Finance Limited was incorporated as M/s Kalpataru Hire Purchase & Leasing Private Limited on 27-04-1995. The Company was later renamed as M/s Enam Finance Private Limited and later to M/s Axis Finance Private Limited vide certificate of incorporation dated 24-June-2008 & 26-03-2013 respectively. The company was later converted into Public company and to its present name vide a fresh Certificate of Incorporation issued on 10-05-2013. Axis Finance Limited is a Non Banking Financial Company (NBFC) registered with the Reserve Bank of India. With effect from 20th October 2012, Enam Securities Private Limited has merged into Axis Sales and Securities Limited (a Wholly owned subsidiary of Axis Bank Limted). The name of the merged entity has since been changed to Axis Capital Limited. Further, giving legal effect to the scheme of demerger, the Board of Directors of the Enam Finance Private Limited (“the Company”) in their meeting held on October 20, 2012 has passed the resolution to permit transfer of shares of the Company from Axis Capital Limited to Axis Bank. To reflect the change in ownership and control it is also proposed to change the name of the company from Enam Finance (Pvt) Limited to Axis Finance Limited (AFL). As of now AFL is a 100% subsidiary of Axis Bank Limited As on 31stMarch 2014, the networth of the Company was Rs.412.10 Crores. In May 2013, Axis Bank Limited has infused fresh equity of Rs.250 crores into the Company. As on 30 September 2014, Axis Finance Limited has no subsidiaries. Parent Overview: Axis Bank Limited is the third largest private sector bank in India. Axis Bank offers the entire spectrum of financial services to customer segments covering Large and Mid-Corporates, MSME, Agriculture and Retail Businesses. Axis Bank has a large footprint of 2,402 domestic branches (including extension counters) and 12922ATMs spread across the country as on 31st March 2014. Axis Bank also has overseas offices in Singapore, Hong Kong, Shanghai, Colombo, Dubai and Abu Dhabi. Axis Bank is one of the first new generation private sector banks to have begun operations in 1994. Axis Bank was promoted in 1993, jointly by Specified Undertaking of Unit Trust of India (SUUTI) (then known as Unit Trust of India), Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC), National Insurance Company Limited, The New India Assurance Company Limited, The Oriental Insurance Company Limited and United India Insurance Company Limited. The shareholding of Unit Trust of India was subsequently transferred to SUUTI, an entity established in 2003. With a balance sheet size of Rs. 3,83,245 crores as on 31st March 2014, Axis Bank has achieved consistent growth and stable asset quality with a 5 year CAGR (2010-14) of 21% in Total Assets, 19% in Total Deposits, 23% in Total Advances and 28% in Net Profit. The Bank has set up seven wholly-owned subsidiaries: Axis Capital Limited, Axis Private Equity Limited, Axis Trustee Services Limited, Axis Asset Management Company Limited, Axis Mutual Fund Trustee Limited, Axis Bank UK Limited and Axis Finance Limited. Product Profile: The Company as a Non-Banking Finance Company is positioned to offer products in the Retail as well as Corporate Banking segments, some of the key product offerings are:
Corporate Lending Retail Lending Advisory & Arranging
Services Promoter Funding& Real Estate Funding
Margin Funding
Advisory and arranging services for Corporate
Clients
Loan against Marketable securities IPO Funding Structured Funding ESOP Financing Acquisition Funding Loan against Shares(LAS) &
Loan against Property(LAP)$ A brief on the products is as below:
16
Corporate Financial Products Loan against Securities (LAS): Loans against securities are short tenor loans (1-2 years) and secured
against 1.5-2.5 times pledge of shares. Structured Products: Structured products share characteristics of both equity and debt and include
secured products such as term loans, convertible/non-convertible debentures.
Acquisition funding: Since banks can’t fund acquisition, the Company can play a vital role in funding acquisition cost, secured against Share collateral and Target company assets.
Real estate funding: Providing financing through variety of products including debt and structured
debt, bridge or last mile funding, loans with no end-use restriction.
Retail Financial Products Margin Funding: Individual can avail finance against listed securities (BSE & NSE) from the
Company at predefined margin ranging from 25%-60% depending on scrip category.
IPO Funding: Retail customers can avail finance by paying upfront margin of around 2- 20%of application in IPO & can get the benefit of applying for larger ticket size with minimum investment.
ESOP Funding: Retail customers can avail finance to exercise ESOP options. Corporate level
engagement for providing the facility to eligible employees.
Key Operational and Financial Parameters for the last three Audited year Financial Information A summary of our key operational and financial parameters for the last three completed financial years, as specified below, on a consolidated basis are as follows:
(Rs. in Crs)
For Financial Entities FY14 FY13 FY12
(Audited) (Audited)
(Audited)
Networth
412.10 130.52 120.27
Total Debt
800.84 - -
of which –
- Non Current Maturities of Long Term Borrowing
- - -
- Short Term Borrowings
800.84 - -
- Current Maturities of long Term Borrowings
- - -
Net Fixed Assets
0.04 - -
Non Current Assets
653.19
0.06 14.16
Cash and Cash Equivalents
17.36 106.35
7.19
Current Investments
- - 60.50
Current Assets
565.22 130.82 106.68
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Current Liabilities
804.91
0.36
0.56
Assets Under Management
1,104.42 24.18 37.08
Off Balance Sheet Assets
- - -
Interest Income
68.27
9.02
7.67
Interest Expense
15.36
0.04
0.22
Provisioning & Write-offs
2.84 - -
Profit before tax
50.51 15.46 14.36
Provision for tax
17.04
5.21
4.75
Profit after tax (PAT)
33.47 10.25
9.61
Gross NPA (%)
- - -
Net NPA (%)
- - -
Tier I Capital Adequacy Ratio (%)
34.59 534.68 105.84
Tier II Capital Adequacy Ratio (%)
- - -
Gross Debt: Equity Ratio of the Company:-
Before the Issue ( As of 28-02-2015)
After the Issue
Short Term Debt 1032.07 1032.07
Long Term Debt 185.00 200.00
Total Debt 1,217.07 1,232.07
Share Capital 318.25 318.25
Reserve and Surplus 260.28 260.28
Unamortized debenture issue expenses - -
Total 578.53 578.53
Debt Equity Ratio 2.10 2.13 Dividends declared by the company for the previous three (3) years since its incorporation;
NIL
Project cost and means of financing, in case of funding of new projects:
18
Not Applicable
A BRIEF HISTORY OF THE ISSUER SINCE ITS INCORPORATION GIVING DETAILS OF ITS ACTIVITIES INCLUDING ANY REORGANIZATION, RECONSTRUCTION OR AMALGAMATION, CHANGES IN ITS CAPITAL STRUCTURE, (AUTHORIZED, ISSUED AND SUBSCRIBED) AND BORROWINGS, IF ANY.
(a) Major Events in the Company's history
Year Event 1995-96 Company was incorporated with the name " Kalpataru Hire Purchase & Leasing Private
Limited" at Madras, Tamil Nadu 2008-09 Company's name changed to "Enam Finance Private Limited" 2010-11 Company’s registered office transferred from Chennai, Tamil Nadu to Mumbai,
Maharashtra 2012-13 Company's name changed to Axis Finance Private Limited 2013-14 Company's name changed to Axis Finance Limited on conversion to Public Limited
Company 2013-14
Equity capital infusion of Rs.250 crores by Axis Bank Limited
(b) Share Capital as on 31-December-2014:-
Share Capital Rs. 2,557,500,000 Authorized Share Capital Rs. 3,300,000,000 Issued, Subscribed and Paid-up ShareCapital Rs. 2,557,500,000 Paid- up capital after the Issue This being an issuance of Debentures
the paid-up does not change Paid- up capital after conversion of convertible instruments (if applicable)
Not Applicable
Share Premium Account before the Issue Rs. 823,750,000 Share Premium Account after the Issue Rs. 823,750,000
(c) Change in Capital Structure as on the last quarter end, for the last 5 years:-
Date of Change(AGM/EGM) Rs. Particulars
08.06.2009 (EGM) 50,000,000 Increase in Authorised Share Capital from Rs. 2,500,000 to Rs. 50,000,000 by creation of 4,750,000 Equity shares of Rs.10/- each
31.07.2010 (AGM) 450,000,000 Increase in Authorised Share Capital from Rs. 50,000,000 to Rs. 450,000,000 by creation of 4,000,000 5% Redeemable Non Cumulative Preference Shares of Rs.100/- each
14.10.2010 (EGM) 500,000,000 4,000,000, 5% Redeemable Non Cumulative Preference Shares of Rs.100/- each reclassified as 4,000,000, Preference Shares of Rs.100/- each and Increase in Authorised Share Capital from Rs. 450,000,000 to Rs. 500,000,000 by creation of 5,000,000 Equity shares of Rs.10/- each
25.04.2013 (EGM) 3,000,000,000 Increase in Authorised Share Capital from Rs. 500,000,000 to Rs. 3,000,000,000 by creation of 250,000,000 Equity shares Rs.10/- each
28.07.2014(AGM) 3,300,000,000 Increase in the Authorised Share Capital from Rs. 3,000,000,000 to Rs. 33,000,000,000 by creation of 30,000,000 Equity shares Rs.10/- each and reclassification of preference shares.
19
(d) Equity Share Capital History of the Company as on last quarter end, for the last five years:-
Date of Allotment
No of Equity Shares
Face Value (Rs)
Issue Price (Rs)
Consideration (Cash, other than
cash etc)
Nature of Allotment
Cumulative Remarks No of equity
shares Equity Share Capital (Rs)
Equity Share Premium (in Rs)
27.05.2013 250,000,000 10 10 Cash Preferential Allotment
255,750,000 2,557,50,0,000 Nil
08.02.2013 2,000,000 10 200 Cash Conversion of Preference Shares into Equity Shares
5,750,000 57,500,000 190
19.01.2010 1,500,000 10 10 Cash Preferential Allotment
3,750,000 37,500,000 Nil
20.07.2009 2,000,000 10 10 Cash Preferential Allotment
2,250,000 22,500,000 Nil
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(e) Details of any Acquisition or Amalgamation in the last 1 year.
Nil
(f) Details of any Reorganization or Reconstruction in the last 1 year:-
Type of Event Date of Announcement Date of Completion Details Nil Nil Nil Nil
(g) Details of the shareholding of the Company as on the latest quarter end:-
Sr. No Particulars Total no of
Equity Shares No of shares in
demat form Total Shareholding as % of
total no of equity shares 1. Axis Bank
Limited* 25,57,50,000 25,57,49,950 100%
Notes- (1) *Includes 60 shares held by the nominees of Axis Bank Limited. (2) None of the Shares are pledged or encumbered by the promoters.
(h) List of top 10 holders of equity shares of the Company as on the latest quarter end:-
Sr No
Name of the shareholders
Total Number of Equity Shares
No of shares in demat
form
Total Shareholding as % of total no of equity shares
1. Axis Bank Limited 255750000 (includes 60 shares
held by the nominees of Axis Bank Limited
255749950 100%
(i) Following details regarding the directors of the Company:
Details of the current directors of the Company as on January 31, 2015:
Name, Designation and DIN
Age Address Director of
the Company since
Details of other directorship
Mr. Srinivasan Varadrajan Din No. 00033882
48 years
1301-B, Chaitanya Towers, Appa Saheb Marathe Marg, Prabha Devi, Mumbai- 400025
October 20, 2012
Axis Bank Limited
Axis Trustee Services Limited
Axis UK Limited
Axis Capital Limited
Mr. Bapi Munshi Din No. 02470242
57 years
2101 Vision Crest, D.S Babrekar Marg, Dadar (W), Mumbai -400028
October 20, 2012
Axis Mutual Fund Trustee Limited
Axis Bank Foundation
Mr. Bipin Saraf Managing Director & CEO Din No. 06416744
41 years
– Flat No. 42, 4th Floor, Meherdad Building, 64 Cuffe Parade, Mumbai - 400005
October 20, 2012
NIL
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None of the current directors of the company is appearing in the RBI defaulter list and/or ECGC default list.
(a) The brief profile of the Board of Directors is as under:
Shri V. Srinivasan is a qualified engineer from the College of Engineering, Anna University, Chennai and completed his PGDBM from the Indian Institute of Management, Calcutta in 1990. He began his career in the financial services industry with ICICI Limited, in its Merchant Banking Division, in 1990. He was a part of the start-up team of ICICI Securities and Finance Co. Limited (I-Sec), the joint venture between ICICI and J.P. Morgan and headed the Fixed Income business there. Since 1999, Shri V. Srinivasan was working with J.P. Morgan, India and in his last assignment he was their Managing Director and Head of Markets. He was CEO of J.P. Morgan Chase Bank, Mumbai Branch as well as Chairman, J.P. Morgan Securities (I) Private Limited at the time he left J.P. Morgan. He has served on various RBI Committees such
as the Technical Advisory Committee of RBI, Committee of Repos, STRIPS etc. He has also served as a Chairman of FIMMDA, the key self regulatory body for bond and money markets and PDAI, the self-regulatory organization for Primary Dealers. He joined the Axis Bank Limited in September, 2009 as the Executive Director (Corporate Banking). Shri Bipin Kumar Saraf (CEO & MD) is a Chartered Accountant and Cost Accountant and B. Com. from Calcutta University in 1992. Before joining Axis Bank Limited, Mr. Bipin Kumar Saraf was with IFCI Limited between 1995 till 2003. He started his career with IFCI Limited and before leaving he was responsible for portfolio of 25 large and medium corporates belonging to various sector including Steel, Power, Textile, Petrochemical etc. He joined the Capital Market Department of Axis Bank Limited in 2003 and was in-charge of the Corporate & Financial Advisory Portfolio in Eastern Zone with primary responsibility of undertaking project advisory & appraisal assignments, corporate restructuring and syndication of funds for various corporate clients. Subsequent to that he was responsible for Structured Products business under the erstwhile Capital Markets Department of Axis Bank Limited. Following that he was the Head of Debt Syndication business. Shri Bapi Munshi has completed his Master of Science from IIT Kharagpur. He Joined State Bank of Bikaner and Jaipur as Probationary Officer in November ’79. Worked there for nearly 15 years in various business areas with later part of the tenure in corporate relationship roles. In November ’94 joined Axis Bank Limited (then UTI Bank) at Ahmedabad with the assignment of developing the corporate banking business of the branch. In July ’99 moved to Vadodara as Branch Head. In June ’02 moved to the Axis Bank’s Risk Management function at the Central Office, Mumbai and from May ’05 became the head the Risk function of the Bank. In November '08 moved to head the Treasury function of the Axis Bank Limited. Presently he is acting as the President & Chief Risk Officer of the Axis Bank Limited.
(b) Details of Change in Directors over the last 3 years
Name, Designation and DIN
Date of Appointment / Resignation
Director of the Company since (in case of resignation)
Remarks
Mr. Srinivasan varadrajan Din No. 00033882
20.10.2012 Appointed as Add. Director
Mr. Bapi Munshi Din No. 06416744
20.10.2012 Appointed as Add. Director
Mr. Bipin Saraf Din No. 06416744
20.10.2012 Appointed as Add. Director
Mr. Nilesh Shah Din No. 01711720
20.10.2012 Appointed as Add. Director
Mr. Mukul Mohandas Ceased to be Director 17.04.2008 Resigned as Director
22
Goyal Din No. 00113724
from 25.03.2013
Mr. Mayur Rajnikant Kakadia Din No. 00234560
Ceased to be Director from 25.03.2013
17.04.2008 Resigned as Director
Mr. Manish Desai Din No.01090769
Ceased to be Director from 20.10.2012
25.01.2011 Resigned as Director
Mr. Nilesh Shah Din No. 01711720
Ceased to be Director from 05.01.2015
Resigned as Director
Following details regarding the auditors of the Company:-
(i) Details of the auditor of the Company:
S.R.Batliboi & Co. LLP 14th Floor, The Ruby,29 Senapati Bapat Marg, Dadar (west), Mumbai - 400028
(ii) Details of change in auditor since last three years:
Name Address Date of
Appointment / Resignation
Auditor of the Company since ( in case of resignation)
Remarks
S.R.Batliboi & Co. LLP
14th Floor, The Ruby,29 Senapati Bapat Marg, Dadar (west), Mumbai - 400028
16.07.2013 Appointed as Auditor of the Company at the AGM held on 16.07.2013
Khimji Kunverji & Co.
Sunshine Tower, Level 19, Senapati Bapat Marg, Elphinstone Road, Mumbai - 400013
Ceased to Auditor from 16.07.2013
25.07.2009 Resigned
Details of borrowings of the Company, as on the latest quarter end(31 December 2014):-
(a) Details of Secured Loan Facilities :-
(Rs. Crs)
Lender’s Name
Type of Facility
Amount Sanctioned
Principal Amount
outstanding
Repayment Date /Schedule
Security
Punjab & Sind Bank
Line of Credit 300 130.14 On Demand Charge over receivables
Bank of Baroda
Line of Credit
200 30.07 On Demand Charge over receivables
(b) Details of Unsecured Loan Facilities:- Rs. Crs
Lender’s Name
Type of Facility Amount
Sanctioned Principal Amount
outstanding Repayment
Date/Schedule Axis Bank Limited
Line of Credit 225 170.01 1 year
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(c) Details of NCDs(as on 31 December 2014:-
Debent
ure Series
Tenor / Period of Maturity
Coupon Amount Date of
Allotment
Redemption Date / Schedule
Credit Rating
Secured /unsecure
d
Security
01/2014-15
14 months 8.7535% 50.00 21-Nov-14
21-Jan-16 AAA Secured Mortgage and charge over receivables.
02/2014-15
1092 days Zero 50.00 24-Nov-14
20-Nov-17
AAA Secured Mortgage and charge over receivables.
(d) List of Top 10 Debenture Holders (as on 31 December, 2014):-
Sr. No. Name of Debenture Holders Amount( in Crs)
1 INDIA CREDIT HORIZONS FUND LIMITED 50.00 2 ICICI Prudential Fixed Maturity Plan Series 75 - 1103 Days - Plan P 30.00 3 UTI – FTIF Series XX-VIII (1105 Days) 13.00 4 HDFC Trustee Co. Ltd AC HDFC FMP 1107D October 2014(I) 7.00
(e) The amount of corporate guarantee issued by the Issuer along with name of the
Counterparty (like name of the subsidiary, JV, entity, group company, etc) on behalf of whom it has been issued:
NIL
(f) Details of Commercial Papers as on 31 December 2014 :-
Sr.No Face Value Maturity Date
1 80,000,000.00 23‐Jan‐15
2 610,000,000.00 23‐Jan‐15
3 330,000,000.00 15‐Apr‐15
4 100,000,000.00 3‐Apr‐15
5 500,000,000.00 23‐Jun‐15
6 50,000,000.00 23‐Jun‐15
7 750,000,000.00 26‐Jun‐15
8 550,000,000.00 9‐Jul‐15
9 3‐Mar‐15
24
600,000,000.00
10 750,000,000.00 25‐Feb‐15
11 600,000,000.00 3‐Mar‐15
12 500,000,000.00 25‐Feb‐15
13 1,250,000,000.00 28‐Oct‐15
14 500,000,000.00 29‐Jan‐15
15 750,000,000.00 6‐Nov‐15
16 500,000,000.00 5‐Feb‐15
17 500,000,000.00 27‐Mar‐15
18 750,000,000.00 5‐Jun‐15
19 500,000,000.00 24‐Feb‐15
10,170,000,000.00
(g) Details of rest of borrowing ( if any including hybrid debt like FCCB, Optionally
Convertible Debentures / Preference Shares ) as on March 31, 2014:-
NIL
(h) Details of all default/s and/or delay in payments of interest and principal of any kind of term loans, debt securities and other financial indebtedness including corporate guarantee issued by the Company, in the past 5 years:
As of March 31, 2014, there was no default /s and/or delay in payments of interest and principal of any kind of term loans, debt securities.
(i) Details of any outstanding borrowings taken/ debt securities issued where taken / issued
(i) for consideration other than cash, whether in whole or part, (ii) at a premium or discount, or (iii) in pursuance of an option:
NIL
(j) Details of Promoters Holding in the Company as on the latest quarter end:
Sr. No
Particulars Total no of
Equity Shares
No of shares in
demat form
Total Shareholding as % of total no of equity
shares
No of shares
pledged
% of shares pledged
with respect to
shares owned
1. Axis Bank Limited*
25,57,50,000 25,57,49,950 100% NIL NIL
Notes- (1) *Includes 60 shares held by the nominees of Axis Bank Limited. (2) None of the Shares are pledged or encumbered by the promoters.
25
(k) Abridged version of Audited Consolidated (wherever available) and Standalone Financial Information ( like Profit & Loss statement, Balance Sheet and Cash Flow statement) for at least last three years and auditor qualifications , if any:
A summary of the financial position of the company as represented in the audited balance sheets/cash flow statements immediately preceding the date of circulation of Information Memorandum/ Disclosure Letter/ Letter of Offer for each of the last three (3) years;
Balance Sheet
Axis Finance Limited
(Formerly Axis Finance Private Limited)
(Rs. In Crs) (Rs. In Crs)
As at As at As at
31 March 2014 31 March 2013 31 March2012
Equity and liabilities
Shareholders' fund
Share capital 255.75
5.75
43.75
Reserves and surplus 156.35
124.78
76.52
412.10
130.53
120.27
Non current liabilities
Long term provision 1.40
-
0.00
1.40
-
0.00
Current liabilities
Short term borrowings 800.84
-
-
Trade Payable -
-
0.13
Other current liabilities 1.09
0.06
0.07
Short-term provisions 2.97
0.30
0.36
804.91
0.36
0.56
Total 1,218.41
130.89
120.83
Assets
Non-current assets
Fixed assets
26
0.05 - -
Deferred tax asset 1.03
0.06
Non current investments 89.80
-
14.16
Long term loans and advances
a. Loans 559.62
-
-
b. Others 2.69
-
653.19
0.06
14.16
Current assets
Trade receivables 0.01
0.01
0.58
Cash and bank balances 17.37
106.35
7.19
Current investments -
-
60.50
Short-term loans and advances
a. Loans 544.80
24.18
37.08
b. Others 0.16
0.07
-
Other current assets 2.89
0.21
1.32
565.22
130.82
106.67
-
-
Total 1,218.41
130.89
120.83
Cash flow statement
(Amount in Indian Rupees)
For the year
ended 31.03.2014 For the year
ended 31.03.2013 For the year ended
31.03.2012 A. Cash flow from operating activities Profit before tax 50,51,19,995 15,46,49,244 14,36,89,269 Adjustments For: Depreciation 57,549 6,720 4,480 Loss / (profit) on sale of investment (6,49,32,616) (6,69,61,620) (5,97,93,083) Amortization of debenture redemption premium
(59,55,461) - -
Provision against standard assets 2,84,75,000 6,25,000 -Interest income on bonds (1,02,36,878) - - Interest income on commercial paper (1,45,94,432) - Provision for employee benefits 71,75,131 64,515 76,753 Sundry balance written off - 1,133 - Interest on fixed deposit and NCD (4,54,40,409) (1,34,70,048) (1,44,76,903)Operating Profit before working capital changes
39,96,67,879 7,49,14,944 6,95,00,516
Movement in working capital: Decrease / (increase) in long term loan & advances
(5,60,27,00,000) 1,000 -
Decrease / (increase) in short term loan & advances
(5,20,70,88,629) 12,95,76,606 4,42,47,456
27
For the year
ended 31.03.2014 For the year
ended 31.03.2013 For the year ended
31.03.2012 Decrease / (increase) in trade receivables
88,301 56,43,516 -
Decrease / (increase) in other current assets
(98,47,602) (4,99,334) -
Increase/ (decrease) in short term provisions
9,41,962 (6,25,000) -
Increase/ (decrease) in trade payables - (13,64,233) (20,15,684)Increase/ (decrease) in other current liabilities
1,60,71,502 5,41,658 -
Cash generated From operations (10,40,28,66,587) 20,81,89,157 11,17,32,288 Income tax paid (20,20,06,915) (5,46,99,689) (4,69,18,367) Net cash flow from operating activities (A)
(10,60,48,73,502)
15,34,89,468 6,48,13,921
B. Cash flow from investing activities Interest received on fixed deposit and NCD
3,72,97,077 2,44,19,171 30,08,003
Purchase of fixed assets (5,33,752) - - Investment in fixed deposit matured / (placed) (net)
(having original maturity more than 3 months)
(17,00,00,000) - -
Interest received on bonds 14,23,865 - - Proceeds from Sale of investment 14,08,36,55,433 3,61,50,28,261 3,73,36,24,197 Purchase of investment
(14,89,62,05,385) (2,80,14,28,732) (3,67,88,87,104)
Net cash flow from investing activities (B)
(94,43,62,762) 83,80,18,700 5,77,45,096
C. Cash flow from financing activities Proceeds from borrowings (net of repayment)
8,00,84,34,591 - -
Proceeds from issue of shares (net of issue expenses)
2,48,10,00,000 - -
Inter corporate Deposit - - (7,00,00,000) Net cash flow from financing activities (C)
10,48,94,34,591 - (7,00,00,000)
Net increase/(decrease) in cash and equivalents (A+B+C)
(1,05,98,01,673) 99,15,08,168 5,25,59,017
Cash and cash equivalents at the beginning of the year
1,06,34,87,046 7,19,78,878 1,94,19,861
Cash and cash equivalents at the end of the year
36,85,373 1,06,34,87,046 7,19,78,878
Note: (1) Cash and cash equivalent includes: 31.03.2014 31.03.2013 31.03.2013 Cash 1,954 3,942 6,428 Balance with banks 36,83,419 1,06,34,83,104 7,19,72,450 36,85,373 1,06,34,87,046 7,19,78,878
Profit and Loss statement Statement of profit and loss for the year ended31 March 2014
(Rs. In Crs) (Rs. In Crs) (Rs. In Crs)
For the yearended
For the yearended
For the yearended
31 March 2014 31 March 2013 31 March2012
28
Income
Revenue from operation 68.27
9.03
7.67
Other income 7.76
7.24
7.42
Total income (A) 76.03
16.27
15.09
Expenses
Employee benefit expense 4.91
0.24
0.22
Financial costs 15.36
0.04
0.23
Provisions and write off 2.85
-
-
Other expenses 2.39
0.52
0.29
Depreciation and amortization expense 0.01
0.00
-
Total expenses (B) 25.52
0.80
0.74
Profit before tax (C) =(A)-(B)
50.51
15.46
14.35
Tax expenses:
Current tax pertaining to profit/(loss) forthe current year
18.00
5.20
4.75
Current tax pertaining to profit/(loss) forearlier years
-
0.08
-
Deferred tax (0.97)
(0.06)
-
Profit for the year/period 33.48
10.25
9.60
(l) Abridged version of Latest Audited / Limited Review Half Yearly Consolidated
(wherever available) and Standalone Financial Information (like Profit & Loss statement, and Balance Sheet) and auditors qualifications, if any: Not Applicable
(m) Any material event/ development or change having implications on the financials/credit
quality (e.g. any material regulatory proceedings against the Issuer/promoters, tax litigations resulting in material liabilities, corporate restructuring event etc) at the time of issue which may affect the issue or the investor’s decision to invest / continue to invest in the debt securities.
NIL
(n) The names of the debenture trustee(s) shall be mentioned with statement to the effect
that debenture trustee(s) has given his consent to the Issuer for his appointment under regulation 4 (4) and in all the subsequent periodical communications sent to the holders of debt securities:
The Company has appointed GDA Trusteeship Limited as ‘Debenture Trustee’ registered with SEBI, for the holders of the Debentures. The Company has entered into a Debenture Trustee Agreement/Debenture Trust Agreement, inter-alia, specifying the powers, authorities
29
and obligations of the Company and the Debenture Trustee in respect of the Debentures.
The Debenture holders shall, without any further act or deed, be deemed to have irrevocably given their consent to and authorized the Debenture Trustee or any of their agents or authorized officials to do, inter alia, all such acts, deeds and things necessary in respect of or relating to the security to be created for securing the Debentures being offered in terms of this Information Memorandum. All rights and remedies under the Debenture Trust Agreement and/or Debenture Trustee Agreement and/or other security documents shall rest in and be exercised by the Debenture Trustee without having it referred to the Debenture holders. Any payment made by the Company to the Debenture Trustee on behalf of the Debenture holder(s) shall discharge the Company pro tanto to the Debenture holder(s).
The Debenture Trustee will protect the interest of the Debenture holders in the event of default by the Company in regard to timely payment of interest and repayment of principal and they will take necessary action at the cost of the Company.
(o) Details of any litigation or legal action pending or taken by any Ministry or Department
of the Government or a statutory authority against promoters or Issuer during the last three years immediately preceding the year of the circulation of the offer letter and any direction issued by such Ministry or Department or statutory authority upon conclusion of such litigation or legal action shall be disclosed:
Pune Municipal Corporation
Pune-37 This complaint is filed in Judicial Magistrate First Class (JMFC)r Pune by the Pune Municipal Corporation (PMC) against our Pune Branch. Our MD and CEO, the then DMD Shri. M.M.Agarwal}, the then Director Shri. ISI.C.Singal have been made a party to the case alongwith Shri. Nandkishore Rane and the then Operations Head, Pune Branch. The case stems from the fact that in the month of October, 2009 various Municipal Corporations in Maharashtra had issued notices claiming payment of octroi duty and penalty alleging non-payment of octroi duty on gold coins. As there was immediate threat of seizure of the gold coins, in addition to octroi duty, the Bank was constrained to pay penalty "under protests Since the demand of penalty was illegal and unjust and imposed without following procedure of issuing notices and conducting inquiry, we had filed Writ Petition before Bombay High Court, challenging the demand notice and for refund of the penalty amount paid by us. The Writ Petition was allowed by the Hon'ble High Court vide order dated 13.03.2009 requiring the Pune Municipal Corporation to refund a sum of Rs.57,40,260/- to our Bank. Against the said order, the PMC had filed appeal in Supreme Court of India. We are contesting the same. Though the matter is sub judice and pending in Supreme Court, PMC has filed a complaint as stated above in 2009 a copy of the same has been served/referred to Law Dept. only on 22.0S.2013. We have appointed Adv. Aagashe and filed application for exemption from appearance of our MD and other officials, and to contest the complaint before trial court. We are also exploring the possibility of filing quashing petition before High Court.
The State of Maharashtra
Parbhani-1042 The Jintur Nagar Palika filed a complaint against some of its employees, Branch Head and two officials of AXIS Bank, Parbhani Branch alleging encashment from their account maintained in the name of Jinthur Municipal Council Nagri Dalitettaryojna. It is alleged that Bank paid cash to the bearer of the cheque one Mr.
30
Jafar khan Mujaffar Khan, which was claimed to be forged. The bank has submitted the required document to the police and the statement of the employees has been recorded by them. We have approached the Bombay High Court, Aurangabad Bench. The High Court has granted anticipatory bail to Branch Head but declined bail to two other officials. Case is under investigation by the Police.
Zila Samaj Kalyan Adhikari, Moradabad
Moradabad Uttar Pradesh- 232
Zila Samaj Kalyan Adhikari, Moradabad has filled an FIR against Axis Bank, Moradabad alleging that the Bank has received 3 Cheques for lodgement in outward clearing totalling to Rs. 11,25,9 00/- in the a/c of Swami Dayanand Samaj Uthaan Samiti. It is alleged by the complainant that the said three Cheques are fraudulently encashed in the said a/c by forging the signatures. We have approached High Court for stay of the proceedings. The proceedings in Moradabad CJM has been stayed by the High Court.
(p) Remuneration of Directors (during the current year and last three financial years)
From April 1, 2014 to 31 December 2014 Rs. 43,13,700/- FY 2013-14 Rs. 1,023,3725/- FY 2012-13 NIL FY 2011-12 NIL
(q) Related party transactions entered during the last three financial years immediately
preceding the year of circulation of offer letter including with regard to loans made or, guarantees given or securities provided
As Detailed in Attachment 3 hereof
(r) Summary of reservations or qualifications or adverse remarks of auditors in the last five
financial years immediately preceding the year of circulation of offer letter and of their impact on the financial statements and financial position of the Issuer and the corrective steps taken and proposed to be taken by the company for each of the said reservations or qualifications or adverse remark.
NIL
(s) Details of any inquiry, inspections or investigations initiated or conducted under the
Companies Act or any previous company law in the last three years immediately preceding the year of circulation of offer letter in the case of Issuer and all of its subsidiaries. Also if there were any prosecutions filed (whether pending or not) fines imposed, compounding of offences in the last three years immediately preceding the year of the offer letter and if so, section-wise details thereof for Issuer and all of its subsidiaries – NIL
(t) Details of acts of material frauds committed against Issuer in the last three years, if any,
and if so, the action taken by the company
Nil
(u) Any financial or other material interest of the directors, promoters or key managerial personnel in the issue and the effect of such interest in so far as it is different from the interest of other persons
31
Nil
(v) Particulars of any change in accounting policies during the last three years and their effect on the profits and reserves of the company.
There is no change in accounting policy for the financial year 2011-2012 and 2013-2014. In the financial year 2012-2013, the Company changed (with retrospective effect) its method of providing depreciation on fixed assets, from the Written Down Value (“WDV”) method at the rates prescribed in Schedule XIV to the Companies Act, 1956 to the Straight Line Method (SLM) at the rates based on technical estimates of useful life. The management believes that such change will result in a more appropriate presentation of these assets and will give a systematic basis of depreciation charge more representative of the time pattern in which the economic benefits will be derived from the use of such asset.
Had the company continue to use the earlier basis of providing depreciation, the charge to the Statement of Profit and Loss after taxation for the current period would have been lower by Rs 4,032 and the net block of fixed assets would correspondingly have been higher by Rs 4,032. The net expense of Rs. 2,169 (after adjusting deferred tax credit of Rs 1,863) arising out of retrospective re-computation has been recognised in the current years Statement of Profit and Loss.
(w) Details of default, if any, including therein the amount involved, duration of default and
present status in repayment of any – (a) statutory dues; - NIL (b) debentures and interest thereon; - NIL (c) deposits and interest thereon; - NIL and (d) loan from any bank or financial institution and interest thereon - NIL.
32
(x) The detailed rating rationale (s) adopted (not older than one year on the date of opening of the issue)/ credit rating letter issued (not older than one month on the date of opening of the issue) by the rating agencies shall be disclosed:
The Company has obtained credit rating from the following agency, of which the proposed issue forms a part:
India Ratings has assigned a rating (for an amount of Rs. 800 crores) of “IND AAA” which denotes the highest rating assigned in its national rating scale. (Annexed herewith). Please note that the rating is not a recommendation to buy, sell or hold securities and investors should take their own decision. The rating may be subject to revision or withdrawal at any time by the assigning rating agency and each rating should be evaluated independently of any other rating. The rating obtained is subject to revision at any point of time in the future. The rating agencies have a right to suspend, withdraw the rating at any time on the basis of new information.
(y) If the security is backed by a guarantee or letter of comfort or any other document / letter
with similar intent, a copy of the same shall be disclosed. In case such document does not contain detailed payment structure( procedure of invocation of guarantee and receipt of payment by the investor along with timelines), the same shall be disclosed in the offer document:
Not Applicable. There is no guarantee/letter of comfort stipulated as security.
(z) Copy of consent letter from the Debenture Trustee shall be disclosed:
GDA Trusteeship Limited has given its consent for the issue; vide its letter dated 14 November 2014.
(aa) Names of all the recognised stock exchanges where the debt securities are proposed to be
listed clearly indicating the designated stock exchange:
The Debentures are proposed to be listed on the Wholesale Debt Market segment of BSE Limited.
(bb) Date of passing of board resolution in respect of the Issue: 28 October 2014
(cc) Date of passing of resolution in general meeting authorizing the issue of Debentures: 28 July 2014
(dd) Kind of Securities Offered (i.e. whether share or debentures) and class of security
Secured listed fully redeemable non-convertible debentures of for cash at par aggregating upto Rs. 150,000,000.
(ee) Price at which the security is being offered including premium, if any, alongwith
justification of the price
Face value
(ff) Name and address of the valuer, if any who performed valuation of the security offered – Not Applicable
(gg) Amount which the company intends to raise by way of securities – Rs. 150,000,000.
(hh) Terms of raising of securities – duration, if applicable, rate of dividend or rate of
interest, mode of payment and repayment
33
Refer Issue Details/Summary Term Sheet
(ii) Proposed time schedule for which the offer is valid
Issue Opening Date: March 05, 2015 Issue Closing Date: March 05, 2015
The special resolution of the shareholders of the Issuer approving the proposed Issue will be valid for one year as per Rule 14(2)(a) of Companies (Prospectus and Allotment of Securities) Rules, 2014.
(jj) Particulars of any contribution being made by the directors or shareholders of the Issuer as part of the offer or separately in furtherance of the objects of the Issue –
NIL
(kk) Any financial or other material interest of the directors, or key managerial personnel in
the offer and the effect of such interest in so far as it is different from the interests of other persons –
NIL
(ll) Other details
(i) DRR creation - relevant regulations and applicability:
In terms of Rule 18(7)(b)(ii) of The Companies (Share Capital and Debentures) Rules 2014, NBFC registered with RBI is not required to maintain DRR in case of privately placed debentures.
(ii) Issue/instrument specific regulations - relevant details (Companies Act, RBI guidelines, etc):
The Board of Directors, at its meeting held on 28 October 2014 approved borrowing moneys for an amount upto Rs. 400 crores in aggregate (“Limit”). The Issue under made under this Document shall be well within the Limit stipulated herein. Further, the Board of Directors, at its meeting held on 16 July 2014 approved the resources raising plan of the company.
The Company proposes to issue Debentures in one or more tranches subject to the aggregate amount of all such tranches not exceeding the limit specified in this Tranche Disclosure Document. The Debentures being offered are being issued on private placement basis and shall be subject, inter alia, to the terms of the Disclosure Document, the Disclosure Document for each tranche, the Application Form, the Memorandum and Articles of Association of the Company and the provisions of the Companies Act as applicable to issuance on private placement basis. The Debentures are proposed to be listed on the WDM segment of BSE and issuance shall comply with SEBI (Issue and Listing of Debt Securities) Regulations, 2008 as applicable and as may be amended by SEBI from time to time in respect of listing of debt securities issued on private placement basis on recognized stock exchanges and listing agreement applicable thereto. In addition, the Debentures shall be subject to such other terms and conditions to be incorporated in the Debenture Trust Deed / Debenture Certificates / Letter of Allotment, if issued in physical form and to the extent applicable, the provisions of the Depositories Act 1996, the relevant statutory guidelines and regulations for allotment and listing of securities issued from time to time by the Government of India, SEBI, BSE and the listing agreement (for debt securities) with BSE. Also, the Company may, without being obliged to, purchase Debentures, which may or may not be cancelled and reissued or resold. This Tranche Disclosure Document is neither a prospectus nor a statement in lieu of a prospectus. This is only an information brochure intended for private use and should not be construed to be a prospectus and/or an invitation, to the public or any person other than the addressee, for subscription to the Debentures under any law for the time being in force. The Company can, at its sole and absolute discretion change the terms of the Issue.
(iii) Application process and Information relating to the terms of offer or purchase: Nature
of Instrument
34
The instruments are to be issued in form of Secured Redeemable Non-Convertible Debentures. The Debentures will constitute direct obligation of the Company and rank paripassu inter se amongst the Debenture holders. The Debentures shall be issued in terms of a registered Debenture Trust Deed executed by the Company in favour of the Trustee for the benefit of the Debenture holder(s).
(iv) Deemed Date of Allotment
All the benefits under the Debentures, including the payment of interest, will accrue to the Investor(s) from the Deemed Date of Allotment. (v) Issue of Allotment Letter and Debenture Certificate in Demat Form
The Company shall issue Debentures in dematerialised form and has made necessary arrangements with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) for the same. Debenture holders shall hold the Debentures in demat form and deal with the same as per the provisions of Depositories Act, 1996 /rules as notified by NSDL/CDSL from time to time. Debenture holders should, therefore mention their Depository Participants name, DP-ID and Beneficiary Account Number in the appropriate place in the Application Form. The Company shall take necessary steps to credit the Depository Account of the Investor with the amount of Debentures issued.
Mode of Transfer/Transmission of Debentures
The Debenture(s) shall be transferred and / or transmitted in accordance with the applicable provisions of the Companies Act (“Act”). The provisions relating to transfer and transmission and other related matters in respect of shares of the Company contained in the Articles and the Act shall apply, mutatis mutandis (to the extent applicable to Debentures) to the Debentures as well. The Debentures held in dematerialized form shall be transferred subject to and in accordance with the rules/procedures as prescribed by NSDL/CDSL/Depository Participant of the transferor/transferee and any other applicable laws and rules notified in respect thereof.
Transfer of Debentures to and from NRIs / OCBs in case they seek to hold the Debentures and are eligible to do so, will be governed by then prevailing guidelines of RBI. 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 Debentureholders / Record of the Depository. In such cases, claims, if any, by the transferee(s) would need to be settled with the transferor(s) and not with the Company.
Interest on Application Money
Interest on Application Money at the rate specified in the Disclosure Document for each Tranche (subject to deduction of income tax under the provisions of the Income Tax Act, 1961 (Refer section “Deduction of Tax at Source” below), or any other statutory modification or re-enactment thereof, as applicable) will be paid to all the applicants on the application money for the Debentures. Such interest shall be paid from the date of realization of Cheque(s) / Demand Draft(s) upto one day prior to the Deemed Date of Allotment. Such interest would be paid on all the valid applications, including the refunds. Where the entire subscription amount has been refunded, the Interest on Application money will be paid along with the Refund Orders (if applicable). Where an applicant is allotted lesser number of Debentures than applied for, the excess amount paid on application will be refunded to the applicant along with the interest on refunded money.
The Interest Cheque(s)/ Demand Draft(s) for Interest on Application Money shall be dispatched by the Company within 15 days from the Deemed Date of Allotment by registered post to the sole/ first applicant, at the sole risk of the applicant. The Company may also choose to pay the Interest on Application Money electronically by using the RTGS or NEFT mode of transfers as per the details received from the Investor on the Application Form.
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Interest Rate The Debenture holders will receive interest at the rate specified in the Term Sheet. The Debentures shall carry an implicit yield at the rate as mentioned in the Term Sheet. Payment will be made by way of Cheque(s)/Demand Draft(s)/Interest Warrant(s), which will be dispatched to the Debenture holder(s) by registered post/ speed post/ courier or hand delivery on or before the Interest Payment Dates. The Company may also choose to pay the Interest electronically by using the RTGS or NEFT mode of transfers as per the details received from the Investor on the Application Form. Computation of Interest Interest for each interest periods, including Interest on Application Money shall be computed on a 365 days-a-year basis on the principal outstanding on the Debentures. However, where the Interest Period (start date to end date) includes 29th February interest shall be computed on 366 days-a-year basis, on the principal outstanding on the Debentures. Payment of Interest Payment of interest on the Debenture(s) will be made to those holder(s) of the Debenture(s) (“Debenture holders”), whose name(s) appear in the Register of Debenture holder(s) (or to the first holder in case of joint holders) as on the Record Date fixed by the Company for this purpose and /or as per the list provided by NSDL/CDSL to the Company of the beneficiaries who hold Debentures in demat form on such Record Date, and are eligible to receive interest. Payment will be made by way of cheque(s), which will be dispatched to the Debenture holder(s) by registered post/ speed post/ courier or hand delivery on or before the Interest Payment Dates. The Company may also choose to pay the Interest electronically by using the RTGS or NEFT mode of transfers as per the details received from the Investor on the Application Form. Record Date The Record Date will be 15 days prior to each Interest Payment Date or the date of Redemption or put/call option date as the case may be. Deduction of Tax at Source Tax applicable on Interest payment and/or Interest on Application money payments under the Income-Tax Act, 1961, or under any other statutory modification or re-enactment thereof will be deducted at source. Tax exemption certificate/ document, under Income Tax Act, 1961, if any, must be lodged in duplicate at the office of the Issuer, at least 15 days prior to the Interest Payment Date. Tax exemption certificate in respect of non-deduction of tax on Interest on Application Money, must be submitted along with the Application Form to the satisfaction of the Issuer. Regarding deduction of Tax at Source and the requisite declaration forms to be submitted, prospective investor is advised to consult his tax advisor before investing in the Debentures to be issued by Axis Finance Limited. Fictitious applications In terms of the Section 38 of the Companies Act, 2013, any person who—
(a) makes or abets making of an application in a fictitious name to a company for acquiring, or
subscribing for, its securities; or
(b) makes or abets making of multiple applications to a company in different names or in different combinations of his name or surname for acquiring or subscribing for its securities;
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or (c) otherwise induces directly or indirectly a company to allot, or register any transfer of,
securities to him, or to any other person in a fictitious name, shall be liable for action under Section 447 of the Companies Act, 2013.
Section 447 of the Companies Act, 2013 reads as follows – Without prejudice to any liability including repayment of any debt under the Companies Act, 2013 or any other law for the time being in force, any person who is found to be guilty of fraud, shall be punishable with imprisonment for a term which shall not be less than six months but which may extend to ten years and shall also be liable to fine which shall not be less than the amount involved in the fraud, but which may extend to three times the amount involved in the fraud.
For the purpose of Section 447 of the Companies Act, 2013 –
“fraud” in relation to affairs of a company or any body corporate, includes any act, omission, concealment of any fact or abuse of position committed by any person or any other person with the connivance in any manner, with intent to deceive, to gain undue advantage from, or to injure the interests of, the company or its shareholders or its creditors or any other person, whether or not there is any wrongful gain or wrongful loss.
“wrongful gain” means the gain by unlawful means of property to which the person gaining is not legally entitled. “wrongful loss” means the loss by unlawful means of property to which the person losing is legally entitled.
Market Lot The market lot and trading of bonds will be one Bond (“Market Lot”). Right to Accept or Reject Applications The Company reserves its full, unqualified and absolute right to accept or reject any application, in part or in full, without assigning any reason thereof. The rejected applicants will be intimated along with the refund warrant, if applicable, to be sent.
PAN/GIR Number All applicants should mention their Permanent Account Number or the GIR Number allotted under Income Tax Act, 1961 and the Income Tax Circle/ Ward/ District. In case where neither the PAN nor the GIR Number has been allotted, the fact of such a non-allotment should be mentioned in the Application Form in the space provided. Signatures Signatures should be made in English or in any of the Indian Languages. Thumb impressions must be attested by a Magistrate/ Notary Public under his/her official seal.
Tax Benefits Debenture holders are advised to consider the tax implications of their respective investment in the Debentures. Security The outstanding principal amount of the Debentures to be issued upon the terms contained herein together with all interest, costs, charges, fees, and expenses payable in respect thereof (the “Secured Obligations”) shall be secured in favour of the Debenture Trustee in the following manner:
(i) By way of a first pari passu mortgage and charge over the Immovable Property of the Company being a commercial space in the ground floor admeasuring on layout bearing number 29 of 2009,
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comprised in Survey No. 1313/2 part of Sriperumbudur Village, Sriperumbudur Taluk, Kancheepuram District, Lake View Garden Layout in the State of Tamil Nadu; and (ii) By way of a first pari passu charge over the Receivables (both present and future) as appearing in the Company’s balance sheet from time to time to the extent of 1.0 times of the outstanding Secured Obligations (the “Secured Assets”) The charge to be created on the Secured Assets shall rank pari passu with the present and future lenders and debenture holders of the Company. The Company agrees to maintain an asset cover of at least 1.0 times of the Secured Obligations, at all times, till the Debentures are completely redeemed. In case of reduction of security cover below 1.0 times for any reason whatsoever, the Company agrees to make-up the deficiency with equivalent amount of receivables, (free from any charge of whatsoever nature), so as to maintain the minimum asset cover of 1.0 times. The Company reserves the right to create further pari passu charge or encumbrances on the Secured Assets without seeking the consent of the Debenture Trustee or the Debenture Holders so long as the security cover of 1.00 times of the Secured Obligations is maintained.
Redemption The Debentures shall be redeemed at such price, at the expiry of the respective tenor or at the exercise of put/call option, if any as mentioned in the Term Sheet. Procedure for Redemption No action is required on the part of the Debentureholder(s) at the time of Redemption of the Debentures and on the Redemption date, the redemption proceeds would be paid to those Debentureholder(s) whose name(s) appear on the list of beneficial owners given by the Depositories to the Company. The name(s) would be as per the Depositories' records on the Record Date fixed for the purpose of Redemption. All such Debentures will be simultaneously redeemed through appropriate debit corporate action. The cheque for redemption proceeds will be dispatched by courier or hand delivery or registered post at the address provided in the Application / at the address as notified by Debenture holder(s) or at the address with Depositories' record. The Company may also use credit through RTGS/NEFT as a mode of transfer of redemption proceeds. Once the cheque for redemption proceeds is dispatched to the Debenture holder(s) at the addresses provided or available from the Depositories record or the credit through RTGS/NEFT mode of transfer is done, the Company’s liability to redeem the Debentures on the date of Redemption shall stand extinguished and the Company will not be liable to pay any interest, income or compensation of any kind from the date of redemption of the Debenture(s). Depository Arrangement The Company has appointed Link Intime India Private Limited as Registrars and Transfer Agents for Debenture Issuance. The Company has entered into depository arrangements with National Securities Depository Limited (NSDL) and Central Depository Services Ltd. (CDSL). The Company reserves the right to appoint any other Registrar for a certain Issue.
Effect of Holidays (i) If any due date for coupon payment on the Debentures, falls on a Saturday, Sunday or a
holiday, the next Business Day shall be considered as the effective payment date.
(ii) If any due date for payment of redemption proceeds falls on a Saturday,Sunday or a holiday, the previous Business Day shall be considered as the effective payment date and on such
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date, the redemption proceeds shall be paid along with the interest amount on the outstanding value of debentures computed as per the section on “Computation of Interest”.
The Company will not liable to pay any amount from the date of Redemption of the Debenture(s). In case of any delay in surrendering the Debenture Certificate(s) for Redemption, the Company will not be liable to pay any interest, income or compensation of any kind for the late redemption due to such delay.”
Succession
Where Debentures are held in joint names and one of the joint holders dies, the survivor(s) will be recognised as the holder(s) of the said Debentures. It would be sufficient for the Company to delete the name of the deceased Debenture holder after obtaining satisfactory evidence of his death. Provided, a third person may call on the Company to register his name as successor of the deceased holder after obtaining evidence such as probate of a will for the purpose of proving his title to the Debentures.
In the event of demise of the sole/first holder of the Debenture(s), the Company will recognise the Executors or Administrator of the deceased Debenture holder, or the holder of the Succession Certificate or other legal representative as having title to the Debentures only if such executor or administrator obtains and produces probate or letter of Administration or is the holder of the Succession Certificate or other legal representation, as the case may be, from an appropriate Court in India. The Directors of the Company in their absolute discretion may, in any case, dispense with production of Probate or Letter of Administration or Succession Certificate or other legal representation.
Where a Non-Resident Indian becomes entitled to the Debenture by way of succession, the following steps have to be complied with:
1. Documentary evidence to be submitted to the Legacy Cell of the RBI to the effect that the
Debenture was acquired by the NRI as part of the legacy left by the deceased holder.
2. Proof that the NRI is an Indian national or is of Indian origin. Such holding by the NRI will be on a non-repatriation basis.
Register of Debenture holders
The Register of Debenture holders containing necessary particulars will be maintained by AFL, at such a place, as it may decide.
Amendment of the Terms of the Debentures The rights, privileges, terms and conditions attached to the respective Tranche Issue may be varied, modified or abrogated with the consent in writing of the holder(s) who hold(s) at least three-fourth of the outstanding amount of the Debenture(s) or with the sanction accorded pursuant to a Special Resolution, passed at a meeting of the Debentureholder(s), (by not less than 3/4th of the Debentureholder(s) present and voting at the meeting); provided that nothing in such consent or resolution shall be operative against the Company where such consent or resolution modifies or varies the terms and conditions of the Debenture(s), if the same are not acceptable to the Company.
Future Borrowings
The Company shall be free to borrow / raise loans or avail financial assistance in whatever form, as also issue Promissory Notes / Debentures / other securities in any manner having such ranking, paripassu or otherwise and change the capital structure including the issue of shares of any class, on such terms and conditions as the Company may deem appropriate, without the consent of, or intimation to the Debentureholder(s)/ Trustee in this connection.
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Purchase
The Company may, at any time and from time to time purchase Debenture(s) at a discount, at par, or at a premium, in the open market or otherwise. Such Debenture(s) may, at the option of the Company, be cancelled, held or resold at such a price and such terms and conditions as the Company may deem fit and as permitted by law.
Re-issue of Debentures
Where the Company has redeemed any such Debentures, subject to the provisions of the Companies Act, 2013 and other laws & rules and regulations as may be applicable in this regard,, the Company shall have and shall be deemed always to have had the right to keep such Debentures alive for the purpose of re-issue and in exercising such right, the Company shall have and shall be deemed always to have had the power to re-issue such Debentures either by re-issuing the same Debentures or by issuing other Debentures in their place.
Trustee to the Debentureholder(s)
The Company has appointed GDA Trusteeship Limited to act as Trustee for the Debentureholder(s) (hereinafter referred to as “The Trustees”). AFL and the Trustees have entered into a Debenture Trust Deed and Debenture Trust Agreement on November 18, 2014 and November 17, 2014 respectively, specifying inter alia, the powers, authorities and obligations of the Trustee and AFL.
By applying for the Debentures, the Debentureholder(s) shall without further action or deed, be deemed to have irrevocably given their consent to and authorised the Trustee or any of their agents or authorised officials to do inter alia all acts, deeds, matters and things in respect of or relating to the debentures. All the rights and remedies of the Debentureholder(s) shall vest in and shall be exercised by the Trustee without reference to the Debentureholder(s). No Debentureholder shall be entitled to proceed directly against AFL unless the Trustee, having become so bound to proceed, failed to do so. The Trustee will endeavour to protect the interest of the Debentureholder(s) in the event of default in regard to timely payment of principal by AFL. Main Events of defaults under the Debenture Trust Deed would be as follows:
Events of Default
If default has occurred (a) in the payment of principal sums of the Debentures on the due dates and such default has
continued for a period of thirty days:
(b) in payment of any installment of interest on the Debenture(s) and such default has continued for a period of thirty days: and
(c) in the performance of any other material covenants, conditions or agreement on the part of the Company under the Debenture Trust Deed or any other deed between the Company and the Debenture holder(s) / Trustee and any other agreement and such default has continued for a period of thirty days after notice in writing thereof has been given to the Company at its registered office by the Debenture holder(s)/Trustee.
Powers of the Trustee under the Debenture Trust Deed to be executed shall include: Inspection The Trustee or its authorized representatives shall be entitled to carry out inspections of the Company’s offices records, registers and accounts upon giving a reasonable notice in writing to the Company at its registered office, to the extent such inspection is necessary for exercising any of the powers or discharging any of its duties of the Trustee hereunder. Any representative of the Trustee shall have free access at all reasonable times to the Company’s premises, records, registers and accounts and shall receive full co-operation and assistance from the Company. The cost of inspection, including traveling and other related expenses shall be borne and paid by the Company.
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Authority to Delegate
The Trustee may, in the execution or exercise of all or any of the trusts, powers, authorities and discretions vested in it by the Debenture Trust Deed act by any officer or officers for the time being of the Trustee and the Trustee may also, whenever it thinks it expedient, delegate to any such officer (with power to sub delegate) all or any of the Trustees, powers, authorities and discretions vested in it by the Debenture Trust Deed and any such delegation may be made upon such terms and conditions as the Trustee may think fit. Such delegation notwithstanding, the Trustee shall not in the absence of fraud or other gross misconduct or willful neglect be in any way responsible for any loss incurred by reason of any misconduct or default or any mistake, oversight, error of judgement, forgetfulness or want of prudence on the part of any such delegate or sub-delegate.
Authority to Employ Agents
The Trustee may, in carrying out the trust hereof, employ and pay any person to transact or concur in transacting any business and do or concur in doing all acts required to be done by the Trustee, including the receipt and payment of monies and shall be entitled to charge and be paid by the Company all professional and other charges incurred in connection therewith.
Trustee may Contract with the Company
Nothing contained in the Debenture Trust Deed shall preclude the Trustee or any agent of the Trustee from making any contract or entering into any arrangement or transaction with the Company in the ordinary course of business of the Trustee or from availing or providing any banking, financial or other services from or to the Company or from underwriting or guaranteeing the subscription of or placing or subscribing to or otherwise acquiring, holding or dealing with any of the stocks, shares, debentures, debenture stocks or any other securities whatsoever of the Company/or other entities / persons in which the Company may be interested.
Limitation on Liability of Trustee 1. The Trustee shall not be bound to give notice to any person of the execution of the Debenture
Trust Deed or to seek the performance or the observance of any of the obligations hereby imposed on the Company or in any way to interfere with the conduct of the Company’s business, unless and until an event of default has occurred;
2. The Trustee shall not be bound to take any steps to ascertain occurrence of any Event of Default.
3. Notwithstanding anything contained in the Debenture Trust Deed, the Trustee shall not be bound to risk its own funds in carrying out or performing any of its duties and obligations hereunder and further the Trustee shall not be bound to act at the request or direction of the Debentureholder(s) under any of the provisions hereof, unless where necessary, the Trustee is put in funds or provision thereof to the satisfaction of the Trustee is made and the Trustee is indemnified to its satisfaction against all costs, charges, expenses and liability which may be incurred in complying with such request or direction.
4. With a view to facilitating any dealing under any provision of the Debenture Trust Deed, the Trustee shall have full power to consent (where such consent is required) to a specified transaction or class of transactions generally or conditionally.
5. The Trustee shall not be responsible for the monies paid by the Debenture holder(s) towards subscription to the debentures or be bound to see the application thereof.
6. The Company shall indemnify and keep indemnified the Trustee and every receiver, attorney, manager, agent or other person appointed by them hereunder in respect of all liabilities, damages, costs, actions, charges and expenses incurred, suffered or sustained by them in execution or purported execution of any powers, authorities or discretion vested in them pursuant to the Debenture Trust Deed.
7. The Trustee shall not be liable for anything done pursuant to the Debenture Trust Deed
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except a breach of trust knowingly and intentionally committed by it.
8. The Trustee may but shall not be obliged to, incur where appropriate or necessary cost of preservation/ protection of the Scheduled Property and all costs so incurred shall be reimbursed by the Company forthwith or on demand.
9. The Trustee shall not be liable for any default, omission or delay in performing or exercising any of the powers or trusts under the Debenture Trust Deed unless the Trustees shall have been previously requested by notice in writing to perform, exercise or do any of such steps as aforesaid by the holders, representing not less than 3/4th of the normal amount of Debentures for the time being outstanding or by a special resolution duly passed at a meeting of the Debenture holder(s) and the Trustee shall not be bound to perform, exercise or do any of such acts, powers or tings or to take any such steps unless and until sufficient monies shall have been provided or provision to the satisfaction of the Trustee made for providing the same by or on behalf of the Debenture holder(s) or some of them in order to provide for any costs, charges and expenses and liabilities which may be incurred in complying with such requests.
Removal of Trustee Removal
75% of the Debentureholder(s) may, for sufficient cause but, after giving not less than two months notice in writing, remove the Trustee by passing a Special Resolution to that effect, and by the same resolution nominate an entity competent to act as their Trustee and require the Company to appoint such entity as the Successor Trustee, in terms of Applicable Law The Company shall within 15 days of receipt of such resolution passed by the Debentureholders take all necessary steps to appoint the entity named in the resolution as the Successor Trustee and complete all necessary formalities to give effect to such appointment.
Who can apply? This Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer and the contents hereof are restricted to only the intended recipient(s) who have been addressed directly through a communication by or on behalf of the Company, and only such recipients are eligible to apply for the Debentures. The categories of Investors eligible to invest in the Debentures, when addressed directly, include infrastructure debt fund, commercial banks, co-operative banks, financial institutions including development financial institutions, companies and bodies corporate, insurance companies, mutual funds, FIIs, , provident funds/ pension funds/ gratuity funds/ superannuation funds and such other categories of investors, as expressly authorized to invest in the Debentures. All Investors are required to comply with the relevant regulations/guidelines applicable to them for investing in this Issue. How to Apply Applications for the Debentures must be made by Investors in the Application Form, and must be completed in block letters in English.. The full amount of the face value of the Debentures applied for has to be paid through electronic mode only (RTGS/NEFT) or transfer cheques (cheques drawn only on Axis Bank Limited) along with the delivery of the fully completed and executed Application Form. The applications not completed in the said manner are liable to be rejected. The Application Forms duly completed accompanied by /application money/transfer instructions from the respective investor’s account to the account of the Issuer, shall be submitted at the registered office. Transfer Cheques/ /electronic transfers may be drawn on any scheduled bank and payable at Mumbai. Returned cheques are not liable to be presented again for collection, and the accompanying Application Forms are liable to be rejected. In case the returned cheques are presented again the necessary charges, if any, are liable to be debited to the Investor. The Company assumes no responsibility for any applications/cheques/demand drafts lost in mail or in transit. Investors are required to submit certified true copies of the following documents, along with the subscription form, as applicable: Memorandum and articles of association/constitutional documents/bye-laws/trust deed Government notification/ Certificate of incorporation/Certificate of registration under the RBI Act; Board resolution / letter authorizing the investment along with operating instructions; Certified true copy of the power of attorney, wherever applicable;
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Specimen signature of the authorised signatories, duly certified by an appropriate authority Copy of the PAN card; Form 15AA granting exemption from tax deductable at source on interest;
Form 15H for claiming exemption from tax deductable at source on interest on application money, if
any; Order under Section197 of the IT Act; Order under Section 10 of the IT Act.
SEBI / IRDA / PFRDA registration certificate, if applicable
The officials should sign the Application Form under their official designations. The payment to be made for subscription of the Debentures shall be made from the bank account of the person subscribing to such Debentures and in case the Debentures are to be held/subscribed by joint holders then the payment shall be made from the bank account of the person whose name first appears in the Application Form. Over and above the aforesaid Terms and Conditions, the said Debenture(s) shall be subject to the Terms and Conditions incorporated in the Tranche Document for an individual tranche, Terms and Conditions to be incorporated in the Debenture Certificate to be issued to the allottees (if held in physical form) and/or the Debenture Trust Agreement / Debenture Trust Deed and all other applicable laws / guidelines. Applications under Power of Attorney A certified true copy of the power of attorney or the relevant authority, as the case may be, along with the names and specimen signature(s) of all the authorized signatories and the tax exemption certificate/ document, if any, must be lodged along with the submission of the completed Application Form. Further modifications/ additions in the power of attorney or authority should be notified to the Issuer or to such other person(s) at such other address(es) as may be specified by the Issuer from time to time through a suitable communication. Right to Accept or Reject Applications The Company is entitled at its sole and absolute discretion to accept or reject any application, in part or in full, without assigning any reason. Application Forms that are not complete in all respects shall be rejected at the sole and absolute discretion of the Company, and would not be paid any interest on the application money. The rejected applicants will be intimated along with the refund warrant, if applicable, to be sent. Interest on application money will be paid from the date of realisation of the cheque(s)/ demand drafts(s) till one day prior to the date of refund. Application would be liable to be rejected on one or more technical grounds, including but not restricted to: (i) Number of Debentures applied for is less than the minimum application size; (ii) Bank account details not given; (iii) Details for issue of Debentures in electronic/ dematerialised form not given; (iv) PAN/GIR and IT Circle/Ward/District not given; (v) In case of applications under Power of Attorney by limited companies, corporate bodies, etc. relevant
documents not submitted; In the event, if any Debentures applied for is not allotted in full, the excess application monies of such Debentures will be refunded, as may be permitted. Issue Program ISSUE OPENING DATE March 05, 2015
ISSUE CLOSING DATE March 05, 2015
The Company reserves the right to change the Issue time table, at its sole discretion, without giving any reasons or prior notice. Debentures will be open for subscription at the commencement of banking hours and close at the close of banking hours on the dates specified in this Tranche Information Memorandum/ Tranche Disclosure
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Document/ Tranche Letter of Offer. Procedure and time of schedule for Allotment On the Debentures being subscribed under this Issue, the Debentures would be Allotted by the Board. The Company will credit the Depository Participant account of the allottee, in favour of the allottees or send a refund letter along with refund amount, in accordance with the provisions hereunder and the Debenture Documents. Basis of Allotment The Company has the sole and absolute right to Allot the Debentures to any applicant. Issue of Debentures After completion of all legal formalities the Company shall credit the depository account of the allottee within 2 (two) days from the date of Allotment. Dispatch of Refund Orders The Company shall ensure dispatch of refund orders, if any, by registered post. Loss of Interest Cheques / Refund Cheques Loss of interest cheques/refund cheques should be intimated to the Company along with request for issue of duplicate instrument. The issue of duplicate in this regard shall be governed by Applicable Law and any other conditions as may be prescribed by the Company. Mode of payment and Interest on subscription amounts The subscription amounts for Debentures shall be deposited/credited only through electronic mode (RTGS/NEFT)in the bank account number 913020023692270 of the Issuer opened and maintained with the Axis Bank Limited (the “Account”). The details of the Account are as follows: Bank Name Axis Bank Limited Account No 913020023692270
IFSC Code UTIB0000004
Bank Address Universal Insurance Building, Fort, Mumbai- 400 001
Beneficiary Axis Finance Limited
Where the entire subscription amount has been refunded, the Interest on application money will be paid along with the refund orders. Where an applicant is allotted a lesser number of Debentures than applied for, the excess amount paid on application will be refunded to the applicant along with the Interest on application money.
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Computation of interest Interest for each of the relevant Interest Periods shall be computed on the basis of actual number of days elapsed in a year of 365 (three hundred and sixty five) days or 366 days (three hundred and sixty six days) in case of a leap year. Interest at the Applicable Interest Rate will be paid only to the beneficiaries as per the beneficiary list provided by the Depository as on the Record Date. Interest on the Debentures shall be payable on the relevant Interest Payment Date for the Debentures, and if such day is not a Business Day, then the Business Day immediately after such day provided that the Interest shall be calculated till the last day of the relevant Interest Period. In the case of joint holders of Debentures, Interest shall be payable to the first named Debenture Holder. The provisions of the Depositories would be compiled by the Issuer for facilitating Interest payment by the Company on the relevant Interest Payment Date. In the case of redemption of any of the Debentures on a day other than an Interest Payment Date, accrued Interest on the Debentures for such broken period shall be paid on a pro-rata basis. All payments made by the Issuer to any Debenture Holder are exclusive of all taxes, other than any taxes on income which income taxes may be deducted at source as per the IT Act or any other statutory modification or re-enactment thereof, and such sums shall be credited / deposited as per the provisions of IT Act. Redemption Each principal amount of Debentures shall be redeemed on the respective Redemption Date. Payment on redemption Payment of the redemption amount of the Debentures will be made by the Company to the beneficiaries as per the beneficiary list provided by the Depositories as on the Record Date. The Debentures shall be taken as discharged on payment of the outstanding amounts of the Debentures by the Company to the beneficiaries as per the beneficiary list. Such payment will be a legal discharge of the liability of the Company towards the Debenture Holders. On such payment being made, the Company will inform the Depository and accordingly the account of the Debenture Holders with Depositories will be adjusted. The Company’s liability to the Debenture Holder for Debentures in respect of all their rights including for payment or otherwise shall cease and stand extinguished after the respective Final Maturity Date. Upon dispatching the payment instrument towards payment of the outstanding amounts of the Debentures as specified above in respect of the Debentures, the liability of the Company shall stand extinguished. Further, the Issuer will not be liable to pay any interest or compensation from such date of redemption. Interest Rate in case of default The Issuer shall pay to the Debenture Holders all amounts payable under the Debenture Documents on the respective interest payment date and the principal payment date. Without prejudice to the other obligations of the Issuer under the Debenture Documents, in the event of default by the Issuer in repayment / redemption of Interest, principal amount and other amounts payable in accordance with the terms of the Debenture Documents in respect of the Debentures, the Issuer shall pay liquidated damages at the rate of two percent (2%) per annum over and above the Applicable Interest Rate on the defaulted amounts. Splitting and Consolidation Splitting and consolidation of the Debentures is not applicable in the demat mode form since the saleable lot is one Debenture. Mode of Transfer The Debentures shall be freely transferable to all classes of eligible investors subject to compliance with Applicable Laws. The Debentures shall be transferred and/or transmitted in accordance with applicable provisions of the Companies Act and other Applicable Laws.
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Transfer of Debentures (being in dematerialised form) would be in accordance to the rules/ procedures as prescribed by the Depositories. Rights of Debenture Holders The Debenture Holder(s) shall not be entitled to any right and privileges of shareholders other than those available to them under any Applicable Law including the Companies Act and the Debenture Documents. The Debentures shall not confer upon the Debenture Holders the right to receive notice(s) or to attend and to vote at any general meeting(s) of the shareholders of the Company. Modification of Rights The rights, privileges, terms and conditions attached to all Debentures may be varied, modified or abrogated with the consent, in writing, of the Majority Debenture Holders or with the sanction accorded pursuant to a resolution passed at a meeting of the Debenture Holders, carried by the Majority Debenture Holders voting there upon a show of hands or, upon poll if such poll is demanded by the Majority Debenture Holders, provided that nothing in such consent or resolution shall be operative against the Company if the same are not accepted in writing by the Company. The Company has received all consents for undertaking this issue or creating security Permitted indebtedness and Permitted Security Interest The Issuer shall not be entitled to issue further secured debentures or undertake further secured borrowings or incur further Indebtedness in any manner as deemed fit by it in its discretion, without consent of or notice of the Debenture Trustee. The Issuer shall not be entitled to create further security on the Security Interest without consent of or notice of the Debenture Trustee. The Debenture Holders agree and undertake that the Debenture Trustee shall be empowered to and entitled to issue such releases, no-objections or charge sharing and/or ceding letters, as demanded by or required by the Issuer from time to time, without further recourse to or approval from the Debenture Holders or any of them.
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Tax Deduction at Source Tax as applicable under the IT Act or under any other statutory modification or re-enactment thereof will be deducted at source on coupon payment. Requisite certificate for tax deducted at source, as contemplated and/or required under the provisions of IT Act from time to time, will be issued to the registered holders of the Debentures as per the records on the Record Date as applicable. Interest payable subsequent to the Deemed Date of Allotment of Debentures will be treated as ‘Interest on Securities’ as per the relevant Income Tax Rules. Debenture Holders desirous of claiming exemption from deduction of income tax at source on the interest payable on Debentures should submit tax exemption certificate/ document, under Section 193 of the IT Act, if any, at the office of the Issuer, at least 30 (thirty) days before the payment becoming due. Tax exemption certificate/declaration of non-deduction of tax at source on interest on application money, should be submitted along with the Application Form. Terms of Debenture Documents The provisions of this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer and the covenants, undertakings, representations and disclosures made by the Issuer under this Tranche Information Memorandum/ Tranche Disclosure Document/ Tranche Letter of Offer shall be supplemental / in addition to the obligations, undertakings, covenants, representations etc. of the Issuer incorporated under the other Debenture Documents. Depository Arrangements The Issuer has made necessary depository arrangements with NSDL and CDSL for issue and holding of Debentures in dematerialized form. Investors can hold the debentures only in dematerialised form and deal with the same as per the provisions of Depositories Act, 1996 as amended from time to time. The Depository Participant’s name, DP-ID and beneficiary account number must be mentioned at the appropriate place in the Application Form. The Issuer shall take necessary steps to credit the Debentures allotted to the depository account of the Debenture Holder. Other Consents GDA Trusteeship Limited has given its written consent dated November 14, 2014 for its appointment as Debenture Trustee to the Issue and inclusion of its name in the form and context in which it appears in this Tranche Information Memorandum/ Tranche Disclosure Document as per the provisions contained in the Companies Act, 2013 and the Companies (Share Capital and Debentures) Rules, 2014. Force Majeure The Issuer reserves the right to withdraw the issue prior to the Deemed Date of Allotment in the event of any unforeseen development adversely affecting the economic and regulatory environment. The Issuer reserves the right to change the issue schedule.
Notices
All notices to the Debentureholder(s) required to be given by the Company or the Trustee shall have and shall be deemed to have been given if published in one English and one Hindi language daily National newspaper in Mumbai and may, at the sole discretion of the Company or the Trustee, but without any obligation, be sent by ordinary post to the original sole/first allottees of the Debenture(s) or if notification and mandate has been received by the Company, pursuant to the provisions contained herein above, to the sole/first transferees.
All notices to be given by the Debentureholder(s), including notices referred to under “Payment of Interest” and “Payment on Redemption” shall be sent by Registered Post/Courier or by hand delivery to the Registrars to the Issue or to such persons at such address as may be notified by the Company from time to time.
Additional Covenants
1. Default of Payment In case of default in payment of Interest and/or principal redemption on the due
dates, an additional interest of at least @ 2% p.a. over the coupon rate will be paid for the defaulting
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period by the Issuer.
2. Delay in Listing In case of delay in listing of the Debentures beyond 20 days from the deemed date of allotment, the Issuer will pay penal interest of atleast @ 1% p.a. over the coupon rate from the expiry of 30 days from the deemed date of allotment till the listing of such Debentures to the investor.
3. Security Creation In case of delay in execution of Debenture Trust Deed and security documents, the Issuer would refund the subscription with agreed rate of interest or will pay penal interest of at least @ 2% p.a. over the coupon rate till these conditions are complied with at the option of the investor.
The interest rates mentioned in the above three cases are the minimum interest rates payable by the Issuer and are independent of each other.
Issue Details/Summary Term Sheet
(a) Summary term sheet containing brief information pertaining to the Secured Non Convertible debt securities (or a series thereof) as follows (where relevant): The following is a summary term sheet containing information that shall be applicable to the Issue.
Issuer Axis Finance Ltd. (“AFL” or the “Issuer”)
Series 05/2014-15
Security Name Zero% AFL, 12th April 2018
Type of Instrument Secured Redeemable Non-Convertible Debentures
Nature of Instrument Secured Redeemable Non-Convertible Debentures
Seniority Senior
Mode of Issue Private Placement
Eligible Investors
Only the persons who are specifically addressed through a communication are eligible to apply for the Debentures. No other person can apply. Please refer page 42 of this Tranche Disclosure Document.
Listing The NCDs would be listed on the Wholesale Debt Market Segment (WDM) of the BSE Ltd (BSE)
Rating “IND AAA” from India Ratings
Issue Amount ( at Face Value) and Issue Size Rs. 15 crores
Option to retain oversubscriptions Not Applicable
Objects of the Issue/ Details of Utilisation of Issue
Proceeds
The object of the Issue is to augment long-term resources of the Company in its line of business, to repay our existing loans and business operations including for capital expenditure and working capital requirements.
The expenses of the present issue would also be met from the proceeds of the Issue. The Main Object Clause of the Memorandum of Association of the Company enables it to undertake the activities for which the funds are being raised through the present issue and also the activities, which the Company has been carrying on till date.
Interim Use of Proceeds The management of the 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, the Company intends to temporarily
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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.
The proceeds of the issue will be utilized for general corporate purposes including augmenting long-term financing requirements of the company in its business and also for other purposes as may be decided by our Board and as permissible under applicable laws and government policies
Coupon Rate Zero%
YTM 8.84% XIRR
Step Up/Step Down Coupon Rate Not Applicable
Coupon Payment Frequency Not Applicable
Coupon payment date(s) Not Applicable
Coupon Type Not Applicable
Coupon Reset Process (including rates, spread, effective date, interest rate cap and floor etc). Not Applicable
Day Count Basis Actual/Actual
Interest on Application Money Not Applicable
Default Interest Rate 2% p.a over the coupon rate for the default amount for the duration of default
Tenor 1134 days
Redemption Date 12th April 2018
Redemption Amount Rs. 10,00,000 each
RedemptionPremium Rs. 3,01,057 each
Issue Price Rs. 10,00,000 each
Discount at which security is issued and the effective yield as a result of such discount.
Not Applicable
Put option Date Not ApplicablePut option Price Not Applicable Call option Date Not Applicable Call option Price Not Applicable Put Notification Time Not Applicable Call Notification Time Not Applicable
Face Value Rs. 10 lakhs each
Minimum Application and in multiples of __Debt securities thereafter
10 debentures and in multiples of 1 debenture thereafter
Issue Opening Date
5th March 2015
Issue Closing Date
5th March 2015
Pay in Date 5th March 2015
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Deemed Date of Allotment 5th March 2015
Issuance mode of the Instrument
Demat only
Trading mode of the Instrument
Demat only
Settlement mode of the Instrument
RTGS/NEFT
Depository NSDL/CDSL
Business Day
Convention
If any interest payment date is not a Business Day in Mumbai, interest will be payable on the next Business Day in Mumbai which shall be the interest payment date. If any principal payment date is not a Business Day in Mumbai. principal will be payable on the previous Business Day in Mumbai which shall be the principal payment date.
Business Day means a day which is not a Saturday, Sunday or a public holiday and on a day when there is RTGS/ NEFT/ ECS clearing facility in Mumbai.
Record Date The record date will be 15 days prior to each interest payment / principal repayment date
Security Please refer page 37 and 38 of this Tranche Disclosure Document.
Transaction Documents Shelf Disclosure Document dated November18, 2014
Disclosure Document dated February 2, 2015
Term Sheet
Rating Letter
Trustee Consent
Application Form
Debenture Trust Deed
Other Terms (If any) Not Applicable
Conditions Precedent to Disbursement
Not Applicable
Condition Subsequent to Disbursement
Not Applicable
Events of Default As per the Debenture Trust Deed
Provisions related to Cross Default Clause Not Applicable
Role and Responsibilities of Debenture Trustee As defined in the debenture trust deed
Governing Law and Jurisdiction Laws of India subject to jurisdiction of Mumbai courts
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Cash Flow in respect of Debenture of face value Rs.10 lakhs: Issue Schedule # Company Axis Finance LimitedFace Value (per security) Rs. 10,00,000.00Issue Opens on March 05, 2015Issue Closure March 05, 2015Allotment/Deemed Date of Allotment March 05, 2015Redemption Date April 12, 2018Coupon Rate Zero%Frequency of Interest payment with specified date N.ADay count Convention Actual/Actual# The Issuer reserves the right to change the issue closing date and in such an event, the Date of Allotment for the Debentures may also be revised by the Issuer at its sole and absolute discretion. In the event of any change in the above issue programme, the Issuer will intimate the investors about the revised issue Programme.
Cash Flow Date No of days in coupon
period Amount (in Rs.)
Premium 12th April 2018, Thursday 1134 3,01,057.00 Principal 12th April 2018, Thursday 1,000,000.00
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MATERIAL DOCUMENTS Copies of the following documents may be inspected at the registered office of the Company from 11:00 am to 1:00 pm on any working day (Monday to Friday) until the date of closing of this Issue: 1. Certified copies of last 3 Financial Years’ Annual Report containing the audited Balance Sheet and
Profit & Loss Account.
2. Certified true copy of the Certificate of Incorporation of the Company. 3. Certified copy of Board Resolution authorizing Issue of Debentures offered under terms of this
Tranche Information Memorandum/ Tranche Disclosure Document and the list of authorized signatories.
4. Certified true copy of the Memorandum and Articles of the Company. 5. Certified true copy of the resolution of the shareholders of the Company.
6. Copy of the consent letter dated November 14, 2014 Debenture Trustee for and on behalf of the
holder(s) of the Debentures. 7. Copy of the letter from credit rating agency conveying the credit rating for the Debentures of the
Company and the rating rationale pertaining thereto. 8. Copy of the draft Debenture Trustee Agreement.
9. Copy of the draft Debenture Trust Deed.
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GENERAL DISCLAIMER
This Tranche Disclosure Document is neither a prospectus nor a statement in lieu of prospectus. The issue of rated secured redeemable non-convertible debentures are proposed to be listed on the WDM segment of the BSE and is being made strictly on a private placement basis. Multiple copies hereof given to the same entity shall be deemed to be given to the same person and shall be treated as such. It does not constitute and shall not be deemed to constitute an offer or an invitation to subscribe to the debentures to the public in general. Apart from the Disclosure Document and the Disclosure Document in relation to each tranche, no offer document or prospectus has been prepared in connection with the offering of this Issue; nor is such a Disclosure Document and the Disclosure Document in relation to each tranche, required to be registered under the applicable laws. Accordingly, the Disclosure Document has neither been delivered for registration nor is it intended to be registered. The contents of the Disclosure Document are intended to be used only by those Debenture holders to whom it is distributed. It is not intended for distribution to any other person and should not be reproduced by the recipient. The person to whom a copy of the Disclosure Document is provided would be alone entitled to apply for the debentures. No invitation is being made to any persons other than those to whom application forms along with the Disclosure Document and the Disclosure Document in relation to each tranche, has been addressed. Any application by a person to whom the Disclosure Document and the Disclosure Document in relation to each tranche, and/or the application form has not been addressed by the issuer shall be rejected without assigning any reason. The person who is in receipt of the Disclosure Document and the Disclosure Document in relation to each tranche, shall maintain utmost confidentiality regarding the contents of the Disclosure Document and shall not reproduce or distribute in whole or part or make any announcement in public or to a third party regarding its contents, without the prior written consent of the issuer.
The Tranche Disclosure Document has been prepared to provide general information about the issuer to potential Debenture holders to whom it is addressed and who are willing and eligible to subscribe to the debentures. This Tranche Disclosure Document does not purport to contain all the information that any potential investor may require. Neither the Disclosure Document and the Disclosure Document in relation to each tranche nor any other information supplied in connection with the debentures should be considered as such receipt a recommendation to purchase any debentures. Each investor contemplating the purchase of any debentures should make its own independent investigation of the financial condition and affairs of the issuer, and its own appraisal of the creditworthiness of the issuer. Potential Debenture holders should consult their own financial, legal, tax and other professional advisors as to the risks and investment considerations arising from an investment in the debentures and should possess the appropriate resources to analyse such investment and the suitability of such investment to such investor's particular circumstances. It is the responsibility of potential Debenture holders to also ensure that they will sell these debentures in strict accordance with the Disclosure Document and the Disclosure Document in relation to each tranche and other applicable laws, so that the sale does not constitute an offer to the public within the meaning of the Companies Act. Disclaimer Clause for Stock Exchanges and SEBI
Issuance of Debentures on private placement basis under the Disclosure Document and the Disclosure Document in relation to each tranche is proposed to be listed on the WDM segment of BSE and copy of the Disclosure Document and the Disclosure Document in relation to each tranche will be filed with the WDM segment of the BSE in terms of SEBI (Issue and Listing of Debt Securities) Regulations, 2008, as amended from time to time. It is to be distinctly understood that submission of the Disclosure Document and the Disclosure Document in relation to each tranche to the BSE should not in any way be deemed or construed to mean that the Disclosure Document and the Disclosure Document in relation to each tranche has been cleared or approved by BSE and / or SEBI; nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of the Disclosure Document and the Disclosure Document in relation to each tranche, nor does it warrant that this issuer's securities will be listed or will continue to be listed on the BSE; nor does it take any responsibility for the financial or other soundness of the issuer, its promoters, its management.
Disclaimer clause of RBI
The issuer is having a valid certificate of registration dated April 25, 2002, 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 issuer or of the
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correctness of any of the statements or representations made or opinions expressed by the issuer and for repayment of deposits / discharge of liabilities by the issuer.
Confidentiality
The information and data contained herein is submitted to each recipient of the Disclosure Document and the Disclosure Document in relation to each tranche on a strictly private and confidential basis. By accepting a copy of the Disclosure Document and the Disclosure Document in relation to each tranche, each recipient agrees that neither it nor any of its employees, agents or advisors will use the information contained herein for any purpose other than evaluating the specific transactions described herein or will divulge to any other party any such information. The Disclosure Document and the Disclosure Document in relation to each tranche must not be photocopied, reproduced, extracted or distributed in full or in part to any person other than the recipient without the prior written consent of the Company. If at any time any such reproduction or disclosure is made and the Company suffers any loss, damage or incurs liability of any kind whatsoever arising out of or in connection with any such reproduction or disclosure, the recipient of the Disclosure Document and the Disclosure Document in relation to each tranche breaching the restriction on reproduction or disclosure agrees to hold harmless and indemnify the Company from and against any such loss, damage or liability.
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DECLARATION:
It is hereby declared that this Disclosure Document contains full disclosures in accordance with the Companies Act, 2013 read with the Companies (Prospectus and Allotment of Securities) Rules, 2014 and the Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 as amended from time to time, relevant RBI regulations and other regulatory requirements.
The Company also confirms that this Disclosure Document does not omit disclosure of any material fact which may make the statements made therein, in light of the circumstances under which they are made, misleading. This Disclosure Document also does not contain any false or misleading statement. It is hereby declared that the Company has exercised due-diligence to ensure complete compliance of prescribed disclosure norms and practices in this Disclosure Document.
The Company accepts no responsibility for any statements made otherwise than in the Disclosure Document or in any other material issued by or at the instance of the Company and that anyone placing reliance on any other source of information would be doing so at his own risk.
The Directors of the Issuer hereby certify and declare that:
(i) the Issuer has complied with the provisions of the Companies Act and the rules made thereunder;
(ii) the compliance with the Companies Act and the rules does not imply that payment of dividend or interest or repayment of debentures, if applicable, is guaranteed by the Central Government;
(iii) the monies received under the offer shall be used only for the purposes and objects indicated in the Offer letter/ disclosure document and the Disclosure Document in relation to each tranche.
I am authorized by the Board of Directors of the Company by resolution dated 28 October 2014 to sign this form and declare that all the requirements of Companies Act, 2013 and the rules made thereunder in respect of the subject matter of this form and matters incidental thereto have been complied with. Whatever is stated in this form and in the attachments thereto is true, correct and complete and no information material to the subject matter of this form has been suppressed or concealed and is as per the original records maintained by the Sponsors subscribing to the Memorandum of Association and Articles of Association. It is further declared and verified that all the required attachments have been completely, correctly and legibly attached to the Tranche Disclosure Document.
It is further declared and verified that all the required attachments have been completely, correctly and legibly attached to this form.
For Axis Finance Limited
Authorised Signatory
Place: Mumbai Date: March 04, 2015
Enclosures: Attachment 1: Copy of credit rating letter dated March 03,2015 from India Ratings Attachment 2 : Copy of GDA Trusteeship Limited Consent Letter Attachment 3: List of Related Party Transactions
