RELIANCE MEDIAWORKS LIMITEDOur Company was incorporated as Adlabs Films Private Limited on November 30, 1987, as a private limited company in Mumbai under the Companies Act, 1956. Pursuant to conversion into a public company, our Company’s name was changed to Adlabs Films Limited. Subsequently, our Company’s name was further changed to Reliance MediaWorks Limited. For details of changes in the name and the registered offi ce of our Company, please see the chapter entitled “History and Certain Corporate Matters” at page 132.

Registered Offi ce: Film City Complex, Goregaon (East), Mumbai 400 065, Maharashtra

Contact Person: Ashish Agarwal, Company Secretary and Compliance Offi cer

Tel: +91 22 3980 8900 Facsimile: +91 22 3980 8985 Email: investor.complaints@relianceada.com Website: www.reliancemediaworks.com

FOR PRIVATE CIRCULATION TO THE EQUITY SHAREHOLDERS OF OUR COMPANY ONLY

MediaWorks

ISSUE OF [•] EQUITY SHARES WITH A FACE VALUE OF ` 5 EACH (“EQUITY SHARES”) FOR CASH AT A PREMIUM OF ` [•] PER EQUITY SHARE FOR AN AMOUNT NOT EXCEEDING ` 60,000 LAKHS ON A RIGHTS BASIS TO THE EXISTING EQUITY SHAREHOLDERS OF OUR COMPANY IN THE RATIO OF [•] EQUITY SHARES FOR EVERY [•] FULLY PAID-UP EQUITY SHARES HELD BY THE EXISTING EQUITY SHAREHOLDERS ON THE RECORD DATE, THAT IS ON [•] (“ISSUE”). THE ISSUE PRICE IS [•] TIMES THE FACE VALUE OF THE EQUITY SHARES. FOR FURTHER DETAILS, PLEASE SEE THE CHAPTER ENTITLED “TERMS OF THE ISSUE” AT PAGE 566.

GENERAL RISKS

Investments in equity and equity related securities involve a degree of risk and Investors should not invest any funds in the Issue unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in the Issue. In order to make an investment decision, Investors must rely on their own examination of our Company and the Issue including the risks involved. The securities being offered in the Issue have not been recommended or approved by the Securities and Exchange Board of India (“SEBI”) nor does SEBI guarantee the accuracy or adequacy of this Draft Letter of Offer. Investors are advised to refer to the chapter entitled “Risk Factors” at page 11 before making an investment in this Issue.

ISSUER’S ABSOLUTE RESPONSIBILITY

Our Company, having made all reasonable inquiries, accepts responsibility for and confi rms that this Draft Letter of Offer contains all information with regard to our Company and the Issue, which is material in the context of the Issue, that the information contained in this Draft Letter of Offer is true and correct in all material aspects 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 Draft Letter of Offer as a whole or any such information or the expression of any such opinions or intentions misleading in any material respect.

LISTING

The existing Equity Shares are listed on the BSE Limited (“BSE”) and the National Stock Exchange of India Limited (“NSE”) (collectively, “Stock Exchanges”). Our Company received “in-principle” approvals from the BSE and the NSE for listing the Equity Shares to be Allotted in the Issue vide their letters dated [•] and [•], respectively. For the purpose of the Issue, the Designated Stock Exchange is [•].

THE PROMOTERS OF OUR COMPANY ARE RELIANCE LAND PRIVATE LIMITED AND RELIANCE CAPITAL LIMITED

LEAD MANAGER REGISTRAR TO THE ISSUE

LINK INTIMEINDIA PVT LTD

YES Bank LimitedIndiabulls Finance Centre Tower II, 27th Floor, Senapati Bapat Marg Elphinstone (West), Mumbai - 400 013Telephone: +91 22 3347 9612Facsimile: +91 22 2421 4508Email: dlrmwlrights@yesbank.inInvestor Grievance Email: merchantbanking@yesbank.inWebsite: www.yesbank.inContact Person: Gautam BadaliaSEBI Registration No.: INM 0000 10874

Link Intime India Private Limited C 13, Pannalal Silk Mills Compound LBS Marg, Bhandup (West), Mumbai 400 078Telephone: +91 22 2596 7878Toll-free: 1-800-22-0878Facsimile: +91 22 2596 0329E-mail: rml.rights@linkintime.co.inInvestor Grievance Email: rml.rights@linkintime.co.inWebsite: www.linkintime.co.inContact Person: Pravin Kasare SEBI Registration No.: INR 0000 04058

Draft Letter of OfferDated July 28, 2012

For Equity Shareholders of the Company only

ISSUE PROGRAMME

ISSUE OPENS ON LAST DATE TO REQUEST FOR SPLITAPPLICATION FORMS

ISSUE CLOSES ON

[●] [●] [●]

TABLE OF CONTENTS

SECTION I: GENERAL ............................................................................................................................................... 1 DEFINITIONS AND ABBREVIATIONS .................................................................................................................... 1 NOTICE TO OVERSEAS SHAREHOLDERS ............................................................................................................. 6 PRESENTATION OF FINANCIAL INFORMATION AND USE OF MARKET DATA ............................................ 8 FORWARD LOOKING STATEMENTS .................................................................................................................... 10 SECTION II: RISK FACTORS ................................................................................................................................... 11 SECTION III: INTRODUCTION ............................................................................................................................... 37 SUMMARY OF INDUSTRY ...................................................................................................................................... 37 SUMMARY OF BUSINESS ....................................................................................................................................... 39 SUMMARY FINANCIAL INFORMATION .............................................................................................................. 45 THE ISSUE ................................................................................................................................................................. 63 GENERAL INFORMATION ...................................................................................................................................... 64 CAPITAL STRUCTURE ............................................................................................................................................ 69 OBJECTS OF THE ISSUE .......................................................................................................................................... 82 BASIS FOR ISSUE PRICE ......................................................................................................................................... 88 STATEMENT OF TAX BENEFITS ........................................................................................................................... 91 SECTION IV: ABOUT THE COMPANY .................................................................................................................. 99 INDUSTRY OVERVIEW ........................................................................................................................................... 99 BUSINESS ................................................................................................................................................................ 111 REGULATIONS AND POLICIES ............................................................................................................................ 128 HISTORY AND CERTAIN CORPORATE MATTERS ........................................................................................... 132 OUR SUBSIDIARIES AND JOINT VENTURES .................................................................................................... 143 OUR MANAGEMENT ............................................................................................................................................. 154 OUR PROMOTER AND PROMOTER GROUP ...................................................................................................... 165 OUR GROUP COMPANIES ..................................................................................................................................... 172 DIVIDEND POLICY ................................................................................................................................................ 187 SECTION V: FINANCIAL INFORMATION .......................................................................................................... 188 FINANCIAL STATEMENTS ................................................................................................................................... 188 FINANCIAL INDEBTEDNESS ............................................................................................................................... 475 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION ............................................................................................................................................................ 487 MATERIAL DEVELOPMENTS .............................................................................................................................. 523 SECTION VI: LEGAL AND OTHER INFORMATION ......................................................................................... 524 OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS ................................................................ 524 GOVERNMENT AND OTHER APPROVALS ........................................................................................................ 552 OTHER REGULATORY AND STATUTORY DISCLOSURES ............................................................................. 554 SECTION VII: ISSUE INFORMATION .................................................................................................................. 566 TERMS OF THE ISSUE............................................................................................................................................ 566 SECTION VIII: MAIN PROVISIONS OF ARTICLES OF ASSOCIATION .......................................................... 594 SECTION IX: OTHER INFORMATION ................................................................................................................. 624 MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION ................................................................... 624 DECLARATION ....................................................................................................................................................... 626

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SECTION I: GENERAL

DEFINITIONS AND ABBREVIATIONS Definitions This Draft Letter of Offer uses certain definitions and abbreviations which, unless the context indicates or implies otherwise, have the meanings as provided below. Reference to any legislation, act or regulation shall be to such legislation, act or regulation as amended from time to time. Issuer Related Terms

Term Description “RMWL”, “our Company”, “the Company” or “the Issuer” Reliance MediaWorks Limited

“We” or “us” or “our” or “our Group”

Reliance MediaWorks Limited and its subsidiaries, joint ventures and associates on a consolidated basis, unless the context indicates or implies otherwise

ADAV Anil Dhirubhai Ambani Ventures Limited Articles / Articles of Association Articles of Association of our Company

Auditors B S R & Co., Chartered Accountants and Chaturvedi & Shah, Chartered Accountants

Board/Board of Directors Board of Directors of our Company or a duly constituted committee thereof Director A director of our Company Eligible Equity Shareholders Existing Equity Shareholders on the Record Date i.e. [●] Equity Shares Equity Shares of our Company at face value of ` 5 each Equity Shareholder / Shareholder A holder of the Equity Shares of our Company

Group Companies

Companies, firms, ventures etc. promoted by our Promoters, irrespective of whether such entities are covered under section 370(1)(B) of the Companies Act or not and disclosed in the chapter entitled “Our Group Companies” at page 172

iLab Our facility for digital image correction, film restoration and film processing in the UK

Joint Ventures Joint ventures of our Company set out in the chapter entitled “Our Subsidiaries and Joint Ventures” at page 143

Lowry Digital Reliance Lowry Digital Imaging Services Inc. Memorandum / Memorandum of Association Memorandum of Association of our Company

Promoter Group

Unless the context otherwise requires, refers to such persons and entities constituting the promoter group of our Company in terms of Regulation 2(1)(zb) of the ICDR Regulations and which are disclosed by our Company to the Stock Exchanges from time to time. Various confirmations and disclosures in this Draft Letter of Offer pertaining to the Promoter Group do not include disclosures and confirmations from the entities that are not part of the Reliance Group

Promoters The promoters of our Company viz. Reliance Land Private Limited and Reliance Capital Limited

Registered Office The registered office of our Company situated at Film City Complex, Goregaon (East), Mumbai 400 065, Maharashtra

Reliance Group In context of this Draft Letter of Offer, Reliance Group shall mean the group of companies headed / promoted by Anil Dhirubhai Ambani

RoC Registrar of Companies, Maharashtra, situated at Everest, 5th Floor, 100, Marine Drive, Mumbai - 400 002, Maharashtra

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Term Description

Subsidiaries Subsidiaries of our Company set out in the chapter entitled “Our Subsidiaries and Joint Ventures” at page 143

Issue Related Terms

Term Description

Abridged Letter of Offer The abridged letter of offer to be sent to the Equity Shareholders of our Company with respect to the Issue in accordance with the ICDR Regulations

Allot / Allotted / Allotment The allotment of Equity Shares pursuant to the Issue Allottees Persons to whom Equity Shares of our Company are Allotted pursuant to the Issue

Application Supported by Blocked Amount / ASBA

The application (whether physical or electronic) used by an ASBA Investor to make an application authorizing the SCSB to block the application amount in his / her specified bank account maintained with the SCSB

ASBA Account An account maintained with an SCSB and specified in the CAF for blocking the amount mentioned in the CAF

ASBA Investor

Equity Shareholders proposing to subscribe to the Issue through ASBA process and who:

1. are holding the Equity Shares of our Company in dematerialized form as on the Record Date and have applied for their Rights Entitlements and / or additional Equity Shares in dematerialized form;

2. have not renounced their Rights Entitlements in full or in part; 3. are not Renouncees; and 4. are applying through blocking of funds in a bank account maintained

with the SCSBs Bankers to the Issue [●] Composite Application Form / CAF

The form used by an Investor to make an application for the Allotment of Equity Shares in the Issue

Consolidated Certificate In case of holding of Equity Shares in physical form, the certificate that our Company would issue for the Equity Shares Allotted to one folio

Controlling Branches of the SCSBs

Such branches of the SCSBs which coordinate with the Lead Manager, the Registrar to the Issue and the Stock Exchanges, a list of which is available at http://www.sebi.gov.in/pmd/scsb.html

Designated Branches Such branches of the SCSBs which shall collect application forms used by ASBA Investors and a list of which is available at http://www.sebi.gov.in/pmd/scsb.html

Designated Stock Exchange [●] Draft Letter of Offer This draft letter of offer dated July 28, 2012 filed with SEBI for its observations

Investor(s) The Equity Shareholders of our Company on the Record Date, i.e. [●] and the Renouncees

Issue

Issue of [●] Equity Shares each for cash at a premium of ` [●] per Equity Share for an amount not exceeding `60,000 lakhs on a rights basis to the existing Equity Shareholders of our Company in the ratio of [●] Equity Shares for every [●] fully paid-up Equity Shares held on the Record Date (i.e. [●])

Issue Closing Date [●] Issue Opening Date [●] Issue Price ` [●] Issue Proceeds The proceeds of the Issue that are available to our CompanyIssue Size The issue of [●] Equity Shares for an amount not exceeding `60,000 lakhs Lead Manager/LM Yes Bank Limited

Letter of Offer The final letter of offer to be filed with the Stock Exchanges after incorporating the observations received from the SEBI on this Draft Letter of Offer

Listing Agreement The listing agreements entered into between our Company and the Stock Exchanges

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Term Description

Monitoring Agency The Monitoring Agency appointed in accordance with Regulation 16 of the ICDR Regulations

Net Proceeds The Issue Proceeds less the Issue related expenses. For further details, please see the chapter entitled “Objects of the Issue” at page 82

Non Institutional Investors

All Investors including sub-accounts of FIIs registered with SEBI, which are foreign corporate or foreign individuals, that are not QIBs or Retail Individual Investors and who have applied for Rights Issue Equity Shares for an cumulative amount more than ` 2 lakhs.

QIB(s) or Qualified Institutional Buyer

Applicants in the Issue who are qualified institutional buyers, as defined under Regulation 2(1)(zd) of the ICDR Regulations

Record Date [●] Registrar to the Issue Link Intime India Private Limited

Renouncee(s) Any person(s) who has/have acquired Rights Entitlements from Equity Shareholders

Rights Entitlement The number of Equity Shares that an Investor is entitled to in proportion to the number of Equity Shares held by the Investor on the Record Date

SAF(s) Split Application Form(s)

SCSB(s) A Self Certified Syndicate Bank registered with SEBI, which acts as a banker to the Issue, and which offers the facility of ASBA. A list of all SCSBs is available at http://www.sebi.gov.in/pmd/scsb.html

Stock Exchanges The BSE and the NSE where the Equity Shares of our Company are presently listed

YES Bank Limited Yes Bank Ltd. Conventional and General Terms or Abbreviations

Term/Abbreviation Description/ Full Form ` or Rupees or INR or Rs. Indian Rupee AGM Annual General Meeting

AS Accounting Standards issued by the ICAI in accordance with the Companies (Accounting Standards) Rules, 2006 as amended

BPLR Benchmark Prime Lending Rate BSE BSE Limited CDSL Central Depository Services (India) Limited Central Government The Central Government of India CIN Corporate Identification Number Companies Act Companies Act, 1956 Depositories Act Depositories Act, 1996

Depository A depository registered with the SEBI under the Securities and Exchange Board of India (Depositories and Participants) Regulations, 1996

DIN Director Identification Number DP ID Depository Participant Identity DP / Depository Participant Depository Participant as defined under the Depositories Act EBITDA Earnings Before Interest, Tax, Depreciation and Amortisation ECS Electronic Clearing Service EGM Extra-Ordinary General Meeting EPS Earnings Per Share FDI Foreign Direct Investment FEMA Foreign Exchange Management Act, 1999

FII Foreign Institutional Investor (as defined under the SEBI (Foreign Institutional Investors) Regulations, 1995), registered with the SEBI

Financial Year / Fiscal / FY 12 months ended March 31 of that particular year. In relation to our Company, Fiscal

4

Term/Abbreviation Description/ Full Form 2007 represents the fifteen months ended June 30, 2007, Fiscal 2008 represents the nine months ended March 31, 2008, Fiscal 2012 represents eighteen months ended September 30, 2012 and Fiscal 2013 represents six months ended March 31, 2013

GAAP Generally Accepted Accounting Principles GDP Gross Domestic Product GoI Government of India ICAI Institute of Chartered Accountants of India

ICDR Regulations Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended from time to time

IFRS International Financial Reporting Standards India Republic of India Indian GAAP Generally accepted accounting principles followed in India IT Act Income Tax Act, 1961 LLC Limited Liability Company LIBOR London Inter Bank Offer Rate MCA Ministry of Corporate Affairs, Government of India

Mutual Fund Mutual fund registered with the SEBI under the SEBI (Mutual Funds) Regulations, 1996

NECS National Electronic Clearing Service NR Non-Resident NRE Account Non-Resident External Account NRI Non-Resident Indian NRO Account Non-Resident Ordinary Account NSDL National Securities Depository Limited NSE National Stock Exchange of India Limited p.a. Per annum PAN Permanent Account Number PAT Profit After Tax PBT Profit Before Tax PLR Prime Lending Rate QIP or Qualified Institutions Placement

Qualified Institutions Placement in accordance with the provisions of Chapter VIII of the ICDR Regulations

RBI Reserve Bank of India Regulation S Regulation S under the Securities Act SBI PLR Prime lending rate of State Bank of India SEBI Securities and Exchange Board of India SEBI Act Securities and Exchange Board of India Act, 1992, as amended from time to time

Securities Act U.S. Securities Act, 1933, as amended from time to time, as amended from time to time

STT Securities Transaction Tax

Takeover Code The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended from time to time

Tier 1 Cities Fairly well-established market, with potential of higher consumer pattern Tier 2 Cities Growing market, experiencing growing demand and investments Tier 3 Cities Market yet to be established, where customers are relatively more price sensitive UK United Kingdom US / USA / United States United States of America

5

Technical and Industry Related Terms

Term/Abbreviation Description/ Full Form 2D 2 dimensional 3D 3 dimensional 6D 6 dimensional ATPs Average ticket prices C&S Cable and satellite CGI Computer-generated imagery DCI Digital Cinema Initiative DI Digital intermediate DTS Digital Theatre Surround E&M Entertainment and media IMAX Image Maximum SPH Spend per head on food and beverages TVC Television commercials VFX Visual effects services

6

NOTICE TO OVERSEAS SHAREHOLDERS No action has been or will be taken to permit the Issue in any jurisdiction where action would be required for that purpose, except that this Draft Letter of Offer has been filed with the SEBI for its observations. Accordingly, the Equity Shares may not be offered or sold, directly or indirectly, and this Draft Letter of Offer may not be distributed, in any jurisdiction, except in accordance with legal requirements applicable in such jurisdiction. Receipt of this Draft Letter of Offer will not constitute an offer in those jurisdictions in which it would be illegal to make such an offer and, in those circumstances, this Draft Letter of Offer must be treated as sent for information only and should not be copied or redistributed. Accordingly, persons receiving a copy of this Draft Letter of Offer should not, in connection with the issue of the Equity Shares or the Rights Entitlements, distribute or send this Draft Letter of Offer in or into the United States or any other jurisdiction where to do so would or might contravene local securities laws or regulations. If this Draft Letter of Offer is received by any person in any such territory, or by their agent or nominee, they must not seek to subscribe to the Equity Shares or the Rights Entitlements referred to in this Draft Letter of Offer. Neither the delivery of this Draft Letter of Offer nor any sale hereunder shall, under any circumstances, create any implication that there has been no change in our Company's affairs from the date hereof or that the information contained herein is correct as at any time subsequent to the date of this Draft Letter of Offer.

NO OFFER IN THE UNITED STATES The rights and the Equity Shares have not been and will not be registered under the United States Securities Act, 1933, as amended (“Securities Act ), or any U.S. state securities laws and may not be offered, sold, resold or otherwise transferred within the United States of America or the territories or possessions thereof (“United States” or “U.S.”) or to, or for the account or benefit of, “U.S. persons (as defined in Regulation S under the Securities Act (“Regulation S”)), except in a transaction exempt from the registration requirements of the Securities Act. The rights referred to in this Draft Letter of Offer are being offered in India, but not in the United States. The offering to which this Draft Letter of Offer relates is not, and under no circumstances is to be construed as, an offering of any securities or rights for sale in the United States or as a solicitation therein of an offer to buy any of the said securities or rights. Accordingly, this Draft Letter of Offer / Letter of Offer / Abridged Letter of Offer and the enclosed CAF should not be forwarded to or transmitted in or into the United States at any time. Neither our Company nor any person acting on behalf of our Company will accept subscriptions or renunciation from any person, or the agent of any person, who appears to be, or who our Company or any person acting on behalf of our Company has reason to believe is, either a “U.S. person” (as defined in Regulation S) or otherwise in the United States when the buy order is made. Envelopes containing CAF should not be postmarked in the United States or otherwise dispatched from the United States or any other jurisdiction where it would be illegal to make an offer under the Letter of Offer, and all persons subscribing for the Equity Shares and wishing to hold such Equity Shares in registered form must provide an address for registration of the Equity Shares in India. Our Company is making this issue of Equity Shares on a rights basis to the Equity Shareholders of our Company and the Letter of Offer / Abridged Letter of Offer and CAF will be dispatched to Equity Shareholders who have an Indian address. Any person who acquires rights and the Equity Shares will be deemed to have declared, represented, warranted and agreed, (i) that it is not and that, at the time of subscribing for the Equity Shares or the rights entitlements, it will not be, in the United States when the buy order is made, (ii) it is not a “U.S. person (as defined in Regulation S), and does not have a registered address (and is not otherwise located) in the United States, and (iii) is authorised to acquire the rights and the Equity Shares in compliance with all applicable laws and regulations. Our Company reserves the right to treat as invalid any CAF which: (i) does not include the certification set out in the CAF to the effect that the subscriber is not a “U.S. person (as defined in Regulation S), and does not have a registered address (and is not otherwise located) in the United States and is authorised to acquire the rights and the Equity Shares in compliance with all applicable laws and regulations; (ii) appears to our Company or its agents to have been executed in or dispatched from the United States; (iii) where a registered Indian address is not provided; or (iv) where our Company believes that CAF is incomplete or acceptance of such CAF may infringe applicable legal or regulatory requirements; and our Company shall not be bound to allot or issue any Equity Shares or Rights

7

Entitlement in respect of any such CAF. Our Company is informed that there is no objection to a United States shareholder selling its rights in India. Rights Entitlement may not be transferred or sold to any U.S. Person. European Economic Area Restrictions In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, “Relevant Member State”), an offer of the Equity Shares to the public may not be made in that Relevant Member State prior to the publication of a prospectus in relation to the Rights Entitlement or the Equity Shares which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except that an offer of Equity Shares or Rights Entitlement to the public in that Relevant Member State from and including the Relevant Implementation Date may be made: (a) to legal entities which are authorised or regulated to operate in the financial markets or, if not so authorised

or regulated, whose corporate purpose is solely to invest in securities;

(b) to any legal entity which has two or more of (1) an average of at least 250 employees during the last Fiscal; (2) a total balance sheet of more than Euro 430.00 lakhs and (3) an annual net turnover of more than Euro 500.00 lakhs, as shown in its last annual or consolidated accounts; or

(c) in any other circumstances falling within Article 3(2) of the Prospectus Directive; provided that no such offer of Equity Shares shall result in the requirement for the publication by our Company or the Lead Manager pursuant to Article 3 of the Prospectus Directive. For the purposes of this provision, the expression an “offer to the public” in relation to any Equity Shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Equity Shares to be offered so as to enable an investor to decide to purchase or subscribe the Equity Shares, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression “Prospectus Directive” means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State. In the case of any Rights Entitlement or Equity Shares being offered to a financial intermediary as that term is used in Article 3(2) of the Prospectus Directive, such financial intermediary will be deemed to have represented, acknowledged and agreed that the Rights Entitlement or Equity Shares acquired by them in the Issue have not been acquired on a nondiscretionary basis on behalf of, nor have they been acquired with a view to their offer or resale to, persons in circumstances which may give rise to an offer of any Rights Entitlement or Equity Shares acquired by them in the Issue to the public other than their offer or resale in a Relevant Member State to qualified investors as so defined who are not financial intermediaries or in circumstances in which the prior consent of the Lead Manager has been obtained to each such proposed offer or resale. United Kingdom Restrictions This Draft Letter of Offer is only being distributed to, and is only directed at (i) persons who are outside the UK , or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (“Order”) or (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). The Equity Shares are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such Equity Shares will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.

8

PRESENTATION OF FINANCIAL INFORMATION AND USE OF MARKET DATA Certain Conventions References in this Draft Letter of Offer to “India” are to the Republic of India. All references to the “US”, or the “U.S.A.” or the “United States” are to the United States of America and all references to “UK” or the “U.K.” are to the United Kingdom. Financial data Unless stated otherwise, the financial data in this Draft Letter of Offer is derived from our Company's audited and restated consolidated financial statements. Our Company's Financial Year commences on April 1 and ends on March 31 of the following calendar year except for:

Fiscal 2007 which commenced on April 1, 2006 and ended on June 30, 2007; Fiscal 2008, which commenced on July 1, 2007 and ended on March 31, 2008; and Fiscal 2012, which commenced on April 1, 2011 and will end on September 30, 2012.

Our Company prepares its financial statements in accordance with the generally accepted accounting principles in India, which differ, in certain respects, from generally accepted accounting principles in other countries. Indian GAAP differs, in certain significant respects, from the International Financial Reporting Standards. Our Company publishes its financial statements in Indian Rupees. Any reliance by persons not familiar with Indian accounting practices on the financial disclosures presented in this Draft Letter of Offer should accordingly be limited. We have not attempted to explain those differences or quantify their impact on the financial data included herein, and we urge you to consult your own advisors regarding such differences and their impact on our financial data. In this Draft Letter of Offer, any discrepancies in any table between the total and the sums of the amounts listed are due to rounding off and, unless otherwise specified, all financial numbers in parenthesis represent negative figures. For definitions, please see the chapter entitled “Definitions and Abbreviations” at page 1. Market and Industry data Unless stated otherwise, market, industry and demographic data used in this Draft Letter of Offer has been obtained from market research, publicly available information, industry publications and government sources. Industry publications generally state that the information that they contain has been obtained from sources believed to be reliable but that the accuracy and completeness of that information is not guaranteed. Similarly, internal surveys, industry forecasts and market research, while believed to be reliable, have not been independently verified and neither our Company nor the Lead Manager makes any representation as to the accuracy of that information. Accordingly, Investors should not place undue reliance on this information. Currency of presentation All references in this Draft Letter of Offer to “Rupees”, “`”, “Rs.”, “Indian Rupees” and “INR” are to Indian Rupees, the official currency of India. All references to “U.S. $”, “U.S. Dollar”, ‘USD” or “$” are to United States Dollars, the official currency of the United States of America. All references to “EUR”, “€” or “Euro” are to Euro, the official currency of the European Union. All references to “MUR” are to Mauritian rupee, the official currency of Mauritius. All references to “MYR” or “RM” are to Malaysian Ringgit, the official currency of Malaysia. All references to “NPR” are to Nepalese Rupee, the official currency of Nepal. All references to “GBP” or “£” are to Pound Sterling, the official currency of the UK.

9

Please Note: One lakh is equal to 100,000/100 thousand One million is equal to 10,00,000/10 lakhs One billion is equal to 1,000 million/100 crores One crore is equal to 10 million/100 lakhs Exchange rates Fluctuations in the exchange rate between the Rupee and the U.S. Dollar will affect the U.S. Dollar equivalent of the Rupee price of the Equity Shares on the Stock Exchanges. These fluctuations will also affect the conversion into U.S. Dollars of any cash dividends paid in Rupees on the Equity Shares. The following table sets forth, for the periods indicated, information with respect to the exchange rate between the Rupee and the U.S. Dollar (in Rupees per U.S. Dollar) based on the reference rates obtained from www.oanda.com. No representation is made that the Rupee amounts actually represent such amounts in U.S. Dollars or could have been or could be converted into U.S. Dollars at the rates indicated, at any other rates or at all.

12 months ended March 31 Period End Average* High* Low* 2009 52.17 46.47 53.97 24.17 2010 45.03 47.74 51.67 44.79 2011 45.40 45.90 47.74 42.21 2012 52.08 48.53 55.55 43.81

Month ended Period End Average* High* Low*

January 2012 50.31 52.36 54.80 50.19 February 2012 49.47 49.78 50.60 49.35

March 2012 52.08 51.13 52.63 49.32 April 2012 53.58 52.63 53.58 51.56 May 2012 56.44 54.86 56.45 53.25 June 2012 56.23 56.24 57.35 54.62

Source: website at www.oanda.com *Note: High, low and average have been obtained from www.oanda.com. The reference rate on July 25, 2012 was U.S. $1.00 = ` 56.05.

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FORWARD LOOKING STATEMENTS

Certain statements in this Draft Letter of Offer are not historical facts but are “forward-looking” in nature. Forward looking statements appear throughout this Draft Letter of Offer, including, without limitation, under the chapters entitled “Risk Factors”, “Management's Discussion and Analysis of Financial Condition and Results of Operations”, “Industry” and “Business”. Our Company may, from time to time, make written or oral forward-looking statements in reports to Equity Shareholders and in other communications. Forward-looking statements include statements concerning our Company’s plans, objectives, goals, strategies, future events, future revenues or financial performance, capital expenditures, financing needs, plans or intentions relating to acquisitions, our Company’s competitive strengths and weaknesses, our Company’s business strategy and the trends our Company anticipates in the industries and the political and legal environment, and geographical locations, in which our Company operates, and other information that is not historical information. Words such as “believe”, “anticipate”, “estimate”, “seek”, “expect”, “continue”, “intend”, “predict”, “project”, “should”, “goal”, “future”, “could”, “may”, “will”, “would”, “targets”, “aims”, “is likely to”, “plan” and similar expressions, or variations of such expressions, are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. By their nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that the predictions, forecasts, projections and other forward-looking statements will not be achieved. These risks, uncertainties and other factors include, among other things, those listed under the chapter entitled “Risk Factors”, as well as those included elsewhere in this Draft Letter of Offer. Prospective investors should be aware that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These factors include, but are not limited, to: Our inability to effectively implement our business and growth strategies; Our ability to effectively respond to competition and changes in technology; Prevention of piracy; Reduction in our advertising/sponsorship revenue; Reduction or termination of our tax incentives; Success of the films that we exhibit; and Competition from other entertainment avenues.

For a further discussion of factors that could cause our Company’s actual results to differ, see the chapters entitled “Risk Factors” and “Business” at pages 11 and 111, respectively. By their nature, certain market risk disclosures are only estimates and could be materially different from what actually occurs in the future. As a result, actual future gains or losses could materially differ from those that have been estimated. Neither our Company nor the Lead Manager make any representation, warranty or prediction that the results anticipated by such forward-looking statements will be achieved, and such forward-looking statements represent, in each case, only one of many possible scenarios and should not be viewed as the most likely or standard scenario. Neither our Company nor the Lead Manager nor any of their respective affiliates or advisors have any obligation to update or otherwise revise any statements reflecting circumstances arising after the date hereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not come to fruition. In accordance with SEBI / Stock Exchanges requirements, our Company and Lead Manager will ensure that Investors in India are informed of material developments until the time of the grant of listing and trading permissions by the Stock Exchanges.

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SECTION II: RISK FACTORS

An investment in Equity Shares involves a high degree of risk. You should carefully consider all the information in this Draft Letter of Offer, including the risks and uncertainties described below, before making an investment in our Equity Shares. The risks and uncertainties described in this section are not the only risks that we currently face. Additional risks and uncertainties not known to us or that we currently believe to be immaterial may also have an adverse effect on our business, results of operations and financial condition. If any of the following risks, or other risks that are not currently known or are now deemed immaterial, actually occur, our business, results of operations and financial condition could suffer, the price of our Equity Shares could decline, and you may lose all or part of your investment. The financial and other related implications of risks concerned, wherever quantifiable, have been disclosed in the risk factors mentioned below. However, there are risk factors where the effect is not quantifiable and hence the same has not been disclosed in such risk factors. To obtain a complete understanding, you should read this section in conjunction with the chapters entitled “Business” and “Management's Discussion and Analysis of Financial Condition and Results of Operations” as well as the other financial and statistical information contained in this Draft Letter of Offer. Unless otherwise stated, the financial information of our Company used in this section is derived from our restated consolidated financial statements. Internal Risks 1. There are certain criminal cases pending against us, our Directors, our Promoters and our Group

Companies. There are 47 criminal proceedings pending against us, our Directors, our Promoters and our Group Companies before various fora and are at various stages of adjudication. The impact of these litigations cannot be quantified. For details of all the pending criminal actions and cases against us, the Promoters and Group Companies please see the chapter entitled “Outstanding Litigations and other Material Developments” at page 524. 2. Gautam Doshi, one of our non-executive Directors, is currently being investigated by the Central Bureau of

Investigation.

The Central Bureau of Investigation (CBI) has registered a first information report dated October 21, 2009 (FIR) pertaining to allegations of criminal conspiracy and criminal misconduct, in respect of telecommunications licences and spectrum allotted by the Government of India inter alia to SwanTelecom Limited in 2008. Pursuant to the FIR, the CBI filed a charge sheet dated April 2, 2011 in the Court of Special Judge (CBI), New Delhi, against various persons, including one of our non-executive Directors, Gautam Doshi. The Special Judge (CBI) has framed charges against all the persons specified in the charge sheet. Proceedings in the matter, including a writ petition that Gautam Doshi has preferred to the High Court at Delhi, are ongoing. For further details, please see the chapter entitled “Outstanding Litigation and Material Developments” at page 524. 3. We have incurred losses in the past and, at present, we have a negative net worth. We incurred net losses of `32,796.95 lakhs and `12,803.08 lakhs in Fiscal 2011 and Fiscal 2010, respectively. Further, for the 12 months ended March 31, 2012, we incurred a net loss of `57,216.63 lakhs and our net worth as at March 31, 2012 reduced to `(23,958.07) lakhs. For further details, please see the chapter entitled “Financial Statements” at page 188. In addition, our ability to pay dividends will depend upon a number of factors, including, amongst others, our profitability, our results of operations, earnings, capital requirements and surplus, general financial conditions, contractual restrictions and applicable Indian and foreign legal restrictions. Our financial

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position may accordingly be perceived adversely by external parties such as customers and bankers, which may affect our reputation and business operations. 4. Our net worth has decreased substantially over the last three years which restricts our ability to invest in our

overseas subsidiaries and joint ventures and may hamper our growth plans. Our Company’s net worth on a standalone basis has decreased from `66,641.07 lakhs as on March 31, 2008 to `3,781.16 lakhs as on March 31, 2012. In terms of the applicable FEMA regulations, we may not invest in our joint ventures or wholly owned subsidiaries situated outside India in excess of 400% of our Company’s net worth as on the last audited balance sheet. This limit includes contribution to the capital of, loans granted to, and guarantees issued to or on behalf of, the overseas joint ventures or wholly owned subsidiaries. As on June 30, 2012 we have invested `50,285.32 lakhs in our overseas subsidiaries and joint ventures. Accordingly, we will not be able invest in our overseas joint ventures or wholly owned subsidiaries till our networth increases significantly, which may have an adverse impact on our future growth plan. 5. If we are unable to effectively implement our business and growth strategies, our results of operations may

be adversely affected. Our success will depend, in large part, on our ability to effectively implement our business and growth strategies. We cannot assure you that we will be able to execute our strategies in a timely manner or within budget estimates or that we will meet the expectations of targeted customers. We believe that our business and growth strategies will place significant demands on our management and other resources and will require us to develop and improve operational, financial and other internal controls. Our business and growth strategies may require us to incur further indebtedness. Any inability to manage our business and growth strategies could adversely affect our business, financial condition and results of operations. As part of our growth strategy, we propose to increase the number of cinema theatres we operate in India and other countries with Indian diaspora. When establishing new cinema theatres, we may encounter cost overruns or delays in implementation due to, among other causes, delays in construction, receipt of government approvals or delivery of equipment by suppliers. For instance, the Image Maximum (IMAX) Dome theatre scheduled to be established in Mumbai in December 2000 was not established until March 2001. In addition, the four screen multiplex project scheduled to be established in Mumbai in September 2001 was not fully established until November 2001. In the future, if any cinema theatres are not established in a timely manner, or at all, our business and results of operations may be adversely affected. Further, we were scheduled to complete construction of all three stages of our studio by December 2011. However, while we completed one stage by January 2011, we are yet to complete construction of the other stages. New cinema theatres we establish may not achieve anticipated levels of patronage and as a result may not perform as expected. The occurrence of any of these risks could adversely affect our business, financial condition, and results of operations. 6. If we cannot respond effectively to competition, our financial condition and results of operations may be

adversely affected. We face competition in the various segments of the entertainment and media industry in which we operate. During the 12 months ended March 31, 2012, and during Fiscal 2011 and Fiscal 2010, our theatrical exhibition business constituted 66.54%, 64.31% and 62.50%, respectively of our total consolidated revenues. We cannot assure you that this business segment will continue to contribute to our consolidated revenue at similar levels. Increased competition resulting from the growth of other theatrical exhibitors’ operations may reduce attendance in our cinema theatres, which could adversely affect our financial condition and results of operations. In addition, our theatrical exhibition business competes with alternative film delivery methods, including cable television, Internet, digital video disc, satellite and pay-per-view services. Film distributors, while licensing a film to the domestic theatrical exhibition industry, have traditionally refrained from making the same film available through other film delivery methods for a certain period of time, a practice commonly referred to as the “theatrical release

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window”. If film distributors significantly reduce the duration of the theatrical release window, the appeal of viewing films in cinema theaters may be reduced, which may adversely affect our business, financial condition and results of operations. We are also engaged in the business of television content production, an area which has witnessed increasing levels of competition. Our costs related to marketing and human resources may increase due to such increased competition. Further, our competitors may expand their financial and other resources in an attempt to increase their market share. If we are unable to adequately address such competitive pressures, our business and financial condition may be adversely affected. 7. Piracy may reduce attendance at our cinema theatres, which may adversely affect our business and financial

condition. Piracy, i.e., making available unauthorised copies of media content, software or other digital content at highly reduced prices or without charge, is prevalent throughout the world, including India. Anti-piracy laws may not be adequate or may be inadequately enforced in the jurisdictions in which we operate. The availability of pirated copies of films may cause some of our potential customers to be less inclined or completely disinclined to visit cinema theatres, which may adversely affect our business and results of operations. Our business is highly dependent on the maintenance of intellectual property rights in the entertainment products and services we create and exhibit. Piracy of media products, including digital and Internet piracy and the sale of counterfeit consumer products, may decrease revenues received from the exploitation of our products. The move to digital formats has facilitated high-quality piracy, particularly through the Internet and cable television. We may face difficulties in monitoring infringement of our intellectual property rights. The Indian film industry experiences significant amounts of losses due to piracy. Existing copyright and trademark laws in India afford only limited practical protection and the lack of Internet-specific legislation relating to trademark and copyright protection creates a further challenge for us to protect our content delivered through such media. Notwithstanding the anti-piracy measures we take, we cannot assure you that we will be able to prevent piracy of our products. 8. Our Auditors have qualified their audit report.

Our auditors have qualified their audit report in respect of our standalone and consolidated financial statements for the 12 months ended March 31, 2012.

In the audit report on standalone financial results for the 12 months ended March 31, 2012, our Auditors have noted that our Company has not accounted for loss on cancellation of derivative contract, post period end, aggregating 2,435.27 lakhs. Our Auditors have noted that our Company has not accounted for this loss as required by the principles of prudence as enunciated in AS – 1. Further, our Auditors have drawn attention to the recognition of Deferred Revenue Expenditure aggregating `1,387.20 lakhs pertaining to start up and stabilization costs of the business of Reliance MediaWorks Entertainment Services Limited, one of our subsidiaries. If our Company had recognised these losses in the 12 months ended March 31, 2012, the loss for the said period would have been higher by `3,822.47 lakhs.

Further, our Auditors have in the report on restated standalone financial information drawn attention to the fact that the networth of our Company has eroded on account of loss of ` 45,850.80 lakhs (as restated) for the 12 months ended March 31, 2012. In addition, our Auditors have in the report on restated consolidated financial information drawn attention to the fact that the networth of our Company has fully eroded on account of loss of ` 57,216.63 lakhs (as restated) for the 12 months ended March 31, 2012.

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The erosion of networth, in their view, indicates an uncertainty that may cast a doubt about our Company’s ability to continue as a going concern. We cannot assure you that our net worth will not decrease further. For further details, please see the chapter entitled “Financial Statements” at page 188.

9. We have not received consents for transferring our film and media services and theatrical exhibition

business to our subsidiaries from some of our lenders.

We are in the process of transferring our film and media services and theatrical exhibition business to certain of our wholly owned subsidiaries which we will identify in due course. The shareholders of our Company have approved the transfer through a resolution dated February 21, 2012.

In terms of the financing agreements with our lenders we are required to obtain their prior consent for, amongst other, transferring our business. While we have received consents from certain lenders we have not received consent from all. Further, the consents received are also subject to certain conditions including:

that there should be no material change to the security offered to the lenders and the assets transferred

should continue to secure the exposure;

the relevant subsidiaries or our Company, as the case may be, should ensure sufficient cash flows to meet the repayment obligations;

that our Company has received necessary approval from all lenders; and

that we would continue to comply with the terms and conditions of the financing documents.

10. Changes in technology may render our current technologies obsolete or require us to undertake substantial capital investments, which could adversely affect our results of operations.

Technologies currently under development or that may be developed in the future, if employed by our existing competitors or new entrants, may adversely affect our competitiveness. The development and application of new technologies involve time, substantial cost and risk. Our competitors may be able to deploy new technologies before us and we cannot predict how emerging and future technological changes will affect our operations or the competitiveness of our services. If we fail to successfully implement new technologies in a timely manner or at all, our business, financial condition and results of operations may be adversely affected. We are engaged in the business of film production services and currently have production laboratories in Mumbai, Chennai, Kolkata and London and a post-production services facility in Burbank, USA. Our film production services business generated `19,997.90 lakhs, `22,849.20 lakhs and `15,354.50 lakhs for the 12 months ended March 31, 2012 and Fiscals 2011 and 2010, respectively, which constituted 23.96%, 26.87% and 20.54%, respectively, of our total consolidated revenues for the said periods. However, new technologies may replace traditional film production methods which may adversely affect our business and results of operations. In relation to our theatrical exhibition business, digital projection technology may replace traditional analogue film projection technology in cinema theatres. Digital projection technology is more expensive to implement and operate than analogue film projection technology. While 257 of our screens were equipped with digital projection technology as of June 30, 2012, to remain competitive in the future, we may be required to implement and operate digital projection technology in more of our cinema theatres, which would require significant investments of time, financial resources and personnel attention that may adversely affect our financial condition. Further, if we are unable to implement digital projection technology in our cinema theatres in a timely manner, or at all, we may lose patronage which could adversely affect our business and financial condition. 11. If the exhibition of films through megaplexes becomes more popular in India, our business and results of

operations may be adversely affected.

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Changes in technology and the availability of real estate have significantly altered the global theatrical exhibition industry. Multiplexes, a cinema theatre format that typically comprises four to five screens may, in the future, be substantially replaced by megaplexes, a cinema theatre format that typically comprises 14 to 15 screens. The megaplex format has achieved popularity in many developed markets, including the United States. In these markets, the industry-wide strategy of aggressively building megaplexes has generated significant competition and has rendered many multiplexes obsolete. If the exhibition of films through megaplexes becomes more popular in India, we may be required to make significant investments to shift our theatrical exhibition business towards the establishment and operation of megaplexes, which could adversely affect our business, financial condition and results of operations. 12. Reduction in our advertisement/ sponsorship revenues could have an adverse effect on our results of

operations. During the 12 months ended March 31, 2012 and each of the Fiscals 2011 and 2010, we had `2,290.80 lakhs, `3,684.20 lakhs and `4,651.70 lakhs of advertisement/ sponsorship revenue, respectively. This constituted 2.74%, 4.33% and 6.22%, respectively, of our total consolidated revenue for the same periods. We generally utilise our existing cinema infrastructure to display advertisements for our advertising customers. Our gross margin on advertisement revenue is high as we do not incur significant additional cost for each additional amount of advertisement revenue we earn. Consequently, changes in our advertisement revenue will have a larger percentage impact on our profit before tax than changes in some of our other sources of revenue. 13. The cost of exhibition of a film varies across films and cinemas and if we are unable to obtain films on

competitive terms, our results of operations may be adversely affected. We rely on distributors to obtain films for exhibition. In order to obtain a film for exhibition, we enter into agreements in which the distributor’s share is typically calculated as a percentage of ticket receipts (net of entertainment taxes and other applicable taxes). The applicable percentage is negotiated on a film-to-film basis in respect of films produced in India and periodically for film releases by international studios. Distributors work on a non-exclusive basis and there is competition between exhibitors to acquire films. Competitive pressures may result in increasing the cost at which we acquire the rights to exhibit films. If we are unable to recover such increased costs through higher box office collections or other forms of revenue generation, our results of operations would be adversely affected. 14. In the event of any reduction or termination of any of our tax incentives or, specifically, if a state

Government refuses to grant, withdraws or reduces its entertainment tax incentive, our business and results of operations may be adversely affected.

We benefit from certain tax regulations and incentives. Specifically, we are subject to entertainment taxes in various states in India in which we operate our cinema theatres. The applicable entertainment tax is determined by the relevant state as a percentage of our gross box office collections in that state. The rates vary substantially and, currently, the highest leviable rate is 40.00% of our gross box office collections, in Uttar Pradesh. We are eligible for entertainment tax exemption for certain of our cinema theatres, which is typically staggered over a period of time. In addition, we also enjoy full entertainment tax exemption in respect of certain of our cinema theatres in Punjab and Rajasthan. When deciding whether to open a new cinema theatre, we consider the availability of entertainment tax holidays and incentives given by various state Governments. Typically, the developer, from whom we propose to acquire a new property, files an application for the grant of an entertainment tax exemption with respect to the relevant property. In respect of its Multiplexes at Ghaziabad, Chinchwad and Kolkata, our Company has made applications to the entertainment tax authorities under the Entertainment Tax Act for availing exemption from payment of Entertainment Tax retrospectively from the date of commencement of operations by our Company from the aforesaid multiplexes. The applications are pending and the amount involved in these matters is `300.60 lakhs. If a state Government refuses to grant, withdraws, or reduces its entertainment tax incentive, our business, financial condition and results of operations may be adversely affected.

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Further, in certain instances, we are required to operate a cinema theatre for a certain period of time in order to avail of certain tax incentives. If we fail to operate a cinema theatre for the required period of time, we will not be eligible for the tax incentive and will have to pay taxes in arrears, which may adversely affect our financial condition and results of operations. 15. Certain equipment for the construction of some of our film studios and cinema theatres may not be received

in a timely manner, or at all, which could adversely affect our business and results of operations. We are currently in the process of constructing a film studio in Film City, Mumbai. As part of the construction process, we have placed orders for certain equipment. However, based on our estimates, we are yet to place orders for large number of equipment. Similarly, we are yet to place orders for certain equipment for new cinema theatres that we are constructing. If we do not receive any such equipment in a timely manner, on favourable terms, or at all, the construction of our film studio and cinema theatres may be delayed or prevented, which could adversely affect our business, financial condition and results of operations. 16. Our business and growth strategies involve the pursuit of strategic acquisitions, and any difficulties

encountered in identifying or integrating other entities may adversely affect our financial condition and results of operations.

Our growth strategy involves the acquisition of new businesses. For example, we have acquired Rave Entertainment Private Limited, Synergy Communications Private Limited (now, “Big Synergy Media Limited”), iLab and Reliance Lowry Digital Imaging Services Inc. (“Lowry Digital”) between the financial years 2007 and 2009. Although as of the date of this Draft Letter of Offer, we have not entered into any letters of intent, memoranda of understanding or agreements regarding contemplated acquisitions, we intend to continue to evaluate options for acquisitions that may improve our businesses and service offerings. We may be unable to complete future acquisitions on terms acceptable to us, in a timely manner, or at all. Our acquisitions may require that our management develop new expertise, manage new business relationships, attract new customers and operate in new geographic markets. Furthermore, acquisitions require the devotion of significant attention and resources from our management, and the diversion of our management, attention and resources could adversely affect our ability to manage our business. In addition, we cannot assure you that the integration of any future acquisitions will be successful or that the expected strategic benefits or synergies of any future acquisitions will be realised. We may experience difficulties in integrating acquisitions into our existing business and operations. Future acquisitions may expose us to potential risks including risks associated with the integration of new operations, services or personnel, unforeseen or unaccounted liabilities, the diversion of resources from our existing businesses and technologies, our inability to generate sufficient revenue to offset the costs of acquisitions, and potential loss of, or harm to, relationships with employees or customers, any of which could significantly disrupt our ability to manage our business and in turn adversely affect our business, financial condition and results of operations. 17. If we are unable to obtain or renew approvals in a timely manner, or at all, our business and results of

operations may be adversely affected. As of June 30, 2012 we operated 133 cinema theatres with 492 screens across India, Malaysia, Nepal and the United States. In order to operate each of these cinema theatres, we must obtain certain approvals, many of which we must renew from time to time. In addition, as we expand our business and open new cinema theatres, we will require additional approvals for these new locations. If we fail to obtain or renew any applicable licences, registration or permits in a timely manner, or at all, our ability to operate our cinema theatres may be adversely affected, which could in turn adversely affect our business, financial condition and results of operations. The approvals and licences obtained by us may contain conditions, some of which could be onerous. We cannot assure you that the approvals, licences, registrations or permits issued to us would not be suspended or revoked in the event of non-compliance or alleged non-compliance with any terms or conditions thereof, or pursuant to any regulatory action. Any suspension or revocation of any of the approvals, licences, registrations or permits that have been or may be issued to us may adversely affect our business and results of operations.

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18. Failure to complete contracts, which have a fixed-time frame, as scheduled may negatively affect our

profitability and may result in increased expenses due to repetition of work. We derive a significant portion of our earnings from our post-production services on a fixed-time frame basis. In respect of such fixed-time post-production services, we bear the risk of penalty provisions, cost overruns, completion delays and wage inflation in connection with these projects. Our failure to estimate the resources and time required for a project, including as a result of uncertainties due to creativity issues, may adversely affect our reputation, business, financial condition and results of operations. In addition, our post-production agreements require that we redo the production of content that is rejected by clients on grounds of such content not complying with specifications. Such agreements also provide for penalty clauses where we are liable to pay penalties for any delay in the completion and handover of the material being produced under the agreement. We cannot assure you that we will always complete the production of material under our post-production arrangements on time or that such material will be accepted by our clients. Any inability to complete these post-productions in a timely manner or in accordance with client specifications could adversely affect our business, financial condition and results of operations. 19. Procurement of new contracts for our post-production business is subject to negotiations, financial closure

and initial quality tests. Our inability to procure new contracts could affect our future results of operations and cash flows.

The growth of our business depends on our ability to win new contracts. Generally, it is difficult to predict whether and when we will be awarded a new contract since many potential contracts involve negotiations with our clients and also financial closure prior to signing definitive agreements. The process also involves initial quality tests which are normally done by way of pilot productions and subject to approval by the clients. As the growth of our business will be derived primarily from these contracts, our future results of operations and cash flows can fluctuate materially from period to period depending on the timing of contract awards. 20. If the number of unsuccessful films in the film industry increases, our business, financial condition and

results of operations may be adversely affected. Our business relies heavily on the success of the films we exhibit. Our potential cinema theatre patrons may be inclined to visit our theatres in significant part based on the appeal of the films we exhibit, irrespective of the services, technologies and amenities we offer. Typically, we are also able to raise the profile of our film production services business through association with successful films. A film’s success cannot be predicted through the use of any definite formula or study of prior successful films. Consequently, the success of a new film may be difficult to predict. We cannot assure you that box office collections of films with well-known casts or previously successful content will be successful. If the number of unsuccessful films in the film industry increases, our business, financial condition and results of operations may be adversely affected. 21. We operate most of our cinema theatres through agreements with the owners and / or developers of the

relevant properties, which entail certain risks. As of June 30, 2012 we operated 133 cinema theatres with 492 screens across India, Malaysia, Nepal and the United States. We operate each of our cinema theatres through a lease on the relevant property, a business conducting agreement or a management agreement to operate the relevant property as a cinema theatre. We cannot assure you that we will be able to enter into or renew business conducting agreements for our cinema theatres that are of the same duration as the relevant property leases on favourable terms, or at all. In the event that a business conducting agreement or lease is not renewed, we will be required to expend time and financial resources to relocate the cinema theatre, which may adversely affect our financial condition. We cannot assure you that we will be able to relocate a cinema theatre to an appropriate location in a timely manner, or at all. There can be no assurance that a relocated cinema theatre will generate revenues at levels equal to those generated at the previous location. Further, if any lease or business conducting agreement is terminated, revoked subsequent to the lock-in period and prior to tenure, not renewed or if we are required to cease business operations at a property for any reason whatsoever, our business, financial condition and results of operations may be adversely affected. After such termination, if the relevant

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property is leased or sold to another theatrical exhibition company, we may face increased competition in that geographic area. We operate some of our cinema theatres inside shopping malls and if the operator of a shopping mall has not obtained certain approvals, our ability to operate such cinema theatres may be adversely affected. While we pay stamp duty on our business conducting agreements, these agreements may be treated as lease under relevant stamp legislation. In such event, we would be required to pay a higher stamp duty and might also be required to pay penalties in accordance with the relevant stamp duty legislation. If any of our business conducting agreements is treated under relevant stamp duty legislation as a lease, our business and financial condition may be adversely affected. 22. We are dependent on the services of key management personnel and our ability to recruit and retain highly

skilled and experienced employees. In order to successfully manage and expand our business, we are dependent on the services of key management personnel and our ability to attract, train, motivate and retain highly skilled employees, including artists, technicians and other professionals. If we are unable to hire additional personnel or retain existing qualified personnel, our ability to expand our business may be impaired and our revenues may decline. We may be unable to hire and retain enough highly skilled and experienced employees to replace those who leave or may not be able to re-deploy. In addition, we do not maintain key man insurance. We also may be unable to retain the proper mix of employees to follow industry trends and changing customer preferences. Any failure to hire or retain key management personnel and highly skilled and experienced employees could adversely affect our business and results of operations. 23. Conditions and restrictions imposed on us by the agreements governing our indebtedness could adversely

affect our ability to operate our businesses. Certain of our financing agreements include conditions and restrictive covenants that require us to obtain consents from the respective lenders prior to carrying out certain activities and entering into certain transactions. Our lenders have certain rights to determine how we operate our businesses, which, among other things, restrict our ability to raise additional equity, pay dividends, make investments, effect a change in ownership, amend our Memorandum and Articles of Association, undertake a merger, amalgamation or reconstruction, make changes in our management, incur additional long-term indebtedness, sell assets or acquire other businesses. We cannot assure you that we will be able to obtain approvals to undertake any of the activities restricted under these financial covenants as and when required in respect of such restrictions or comply with such covenants or other covenants in the future. Further, these debt obligations are typically secured by a combination of security interests over our assets and hypothecation of movables and future receivables. The security allows our lenders to sell the relevant assets in the event of our default, convert outstanding debt into equity, nominate directors to our Board or exercise other such related rights. Under such financing agreements, we are also required to comply with certain financial covenants, such as the maintenance of certain specified financial ratios, including a ratio of gross borrowings to tangible net worth, which may limit our ability to obtain additional funds. We currently are not in compliance with some of these financial ratios; however the relevant lenders have not yet recalled any of these loans. If we are unable to maintain these ratios, the lenders are entitled to declare the loans due immediately. In addition, certain of the loan agreements contain cross-default provisions, whereby a default of any of the covenants under any one of financing agreements may result in an event of default under other financing agreements or respective concession or licence agreements. If we do not repay the outstanding loan amounts in a timely manner or at all, our business, reputation and financial condition may be adversely affected. Further, our Company has used short term borrowings for long term investments during Fiscals 2010 and 2011 and during the 12 months ended March 31, 2012. For further details, please see the chapter entitled “Financial Statements” at page 188. If we incur more debt or there is an increase in the applicable interest rates for our existing debt, our interest payment obligations will increase and we may become subject to additional conditions from lenders, including additional restrictions on the operation of our businesses. The financing agreements that we are party to or which we may enter into in the future may be unilaterally terminated by our lenders or the lenders could decline to lend to us

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under such agreements. Further, we cannot assure you that we will be able to raise additional financing on favourable terms, or at all. Any failure in the future to obtain sufficient financing could result in a lack of cash flow to meet our operating requirements and, therefore, could have an adverse effect on our business, financial condition and results of operations. 24. Our Company, Subsidiaries, Promoters, Group Companies and associate companies of our Company have

availed of unsecured loans that may be recalled by lenders at any time. Our Company, Subsidiaries, Promoters, Group Companies and associate companies of our Company have availed of unsecured loans which may be recalled by the lenders at any time. Any accelerated repayment of such loans may adversely affect the cash flow and results of operations of such entities. We may also require alternative sources of financing, which may not be available on commercially reasonable terms or at all. For further details in relation to the unsecured loans obtained by our Company, please see the chapter entitled “Financial Indebtedness” at page 475. 25. If we are unable to recover certain amounts outstanding in relation to our film production services business,

our financial condition and results of operations may be adversely affected. Certain risks are involved in relation to the film production services industry practice of extending credit for long periods of time and the uncertainty regarding the receipt of certain outstanding amounts due. Due to these industry conditions, we have and will continue to have high levels of outstanding receivables. As of March 31, 2012, we had `9,235.38 lakhs of trade receivables in relation to our film production services business. Given the nature of the film production services industry and our clients, billings are generally subject to negotiation at the time of settlement. This often results in high levels of rebates, discounts and write-offs. Any increase in the levels of rebates, discounts or write-offs given could increase our working capital requirements and could adversely affect our business, financial condition and results of operations. 26. If a third party files an intellectual property infringement case against us, our business, reputation and

financial condition may be adversely affected. A significant portion of our business involves intellectual property. The films exhibited at our cinema theatres and television content we produce involve intellectual property rights of various entities. While we attempt to ensure that necessary consents are obtained from third parties to acquire intellectual property rights for the distribution and exhibition of films and the production of television content, third parties may file infringement cases against us or may make us party to claims filed against third parties, such as producers. Such cases may not be decided in our favour, which may result in the payment of damages and/or injunctive action. Further, the defense of any infringement claim may consume significant time and financial resources. If a third party files an intellectual property infringement action against us, our business, reputation and financial condition may be adversely affected. 27. If the strength of the “Reliance Group” brand name is diluted, our business and financial condition may be

adversely affected. We believe that the “Reliance Group” brand name commands strong brand recall and interest among the Indian population due to its long presence in the Indian market and the diversified businesses in which the Reliance Group operates. Our success depends in part on our ability to leverage the strength of the “Reliance Group” brand name. Any adverse change in the strength of the “Reliance Group” brand name, due to, among other reasons, an adverse change among customers with regard to the perceived service quality of other companies in the Reliance Group, could tarnish the “Reliance Group” brand and cause consumers be less interested in our products and services. If the strength of the “Reliance Group” brand name is diluted for any reason, our business and financial condition may be adversely affected. 28. We do not own several trademarks and a logo related to our business and if we are unable to enter into or

renew licence agreements for the use of these trademarks and logo, our business and financial condition may be adversely affected.

20

We do not own the trademarks “Reliance MediaWorks” and “BIG Cinemas”. Reliance Big Entertainment Private Limited has entered into an agreement for the use of the “BIG Cinemas” trademark. We also do not own the “Reliance” trademark, the logo or the logo. We have entered into a brand licence agreement with Anil Dhirubhai Ambani Ventures Limited for the use of the “Reliance” trademark and the logo. Under the terms of the brand licence agreement, Anil Dhirubhai Ambani Ventures Limited may terminate the agreement on various grounds, including, among others, our failure to pay our debt upon maturity, our undergoing a change of control or any attempt by us to claim any right of ownership in relation to the “Reliance” trademark or the logo. Brand recognition is critical to the successful operation and growth of our business. If we are unable to use the trademarks or logo related to our business, we may be required to change our name and/or logo. Any such change may lead to additional costs or dilute or eliminate the strength of our brand, which would have an adverse effect on our business, financial condition and results of operations. For details, please see the chapter entitled “Business” at page 111. 29. We may acquire new businesses, enter into strategic partnerships or undertake internal restructuring. If

such undertakings / activities do not yield the expected results, it may adversely affect our business, results of operations and financial condition.

We may acquire or partner with companies that we believe will enhance our business, revenues and profitability, in India or overseas, where suitable opportunities arise. We may also evaluate restructuring some of our business divisions and subsidiaries including by transferring certain of our business divisions to our subsidiaries. We may also evaluate various options to raise further capital, including through investments in our subsidiaries which may have an impact on our shareholding in such subsidiaries. These activities, in general, involve numerous risks, including: diversion of our management’s attention and diversion of resources from our existing business;

inability to control or loss of control over the business divisions or subsidiaries as a result of restructuring;

inability to coordinate product, development, sales and marketing functions of the acquired business;

inability to control the activities of the entities with whom we partner, including preventing such partner

from entering into similar arrangements with our competitors; transition of operations, users and advertisers of the acquired business onto our existing platforms;

inability to retain the management, key personnel and other employees of the acquired business and

integrate them into our core workforce successfully and smoothly; inability to assimilate the operations, administrative systems, product, technologies and information

systems of the acquired business with our core businesses; and increase in investment of capital, which may increase our funding requirements as a result of acquisition or

restructuring.

In the event that any of the above risks materialises, we may not be able to manage such risks successfully or in a timely manner or at all, which could have, our business, results of operations and financial condition may be adversely affected. Further, acquired assets or business may not generate the financial results that we expect and we may not be able to achieve the objective of any internal restricting that we may undertake. These activities involved incurring substantial expenditure and employing significant time and other resources. In the event that these activities fail to provide the expected results, our business, results of operations and financial condition may be adversely affected.

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30. Our Company does not own the premises where our Company’s Registered Office is situated and its

operations may be interrupted in case of inability to renew the lease agreement. Our Company does not own the premises where our Company’s Registered Office is situated. In terms of the lease agreement with the Maharashtra Film Stage & Cultural Development Corporation Limited, our Company pays an annual rent for the premises on which our registered office is situated. The rent is subject to an escalation every five years. Additionally, our Company is liable to pay a consideration linked to the activities carried out by our Company from the said premises. The lease has been granted for a term of 33 years (“Initial Term”) from October 21, 1996. The term of the lease shall be renewed for a further period of 33 years on an application made by our Company, six months prior to the expiration of the Initial Term, on the same terms and conditions. In event our Company fails to renew the lease agreement or if our Company is required to vacate the premises for any reason whatsoever, our Company will have to search for alternative office space. There can be no assurance that our Company will be able to obtain the same on similar terms or at all.

31. Contingent liabilities that have not been provided for could adversely affect our financial condition.

As of March 31, 2011 and March 31, 2012, we had certain contingent liabilities that had not been provided for, as disclosed in our restated consolidated financial statements. The details of such contingent liabilities are as follows:

(` in lakhs) Particulars As of March 31, 2011 As of March 31, 2012

Central excise 1,918.40 2,121.50 Service tax Nil 137.20 Income tax 2,418.30 4,205.50 Entertainment tax 12,016.60 12,316.00 Value Added Tax Cannot be quantified Cannot be quantified Claims against our Company not acknowledged as debts 198.60 6,297.10

Contingent liabilities of Subsidiary Companies 2,330.50 3,194.90

Share of contingent liabilities in the Joint Ventures 116.20 98.00

If any of these liabilities materialises, our financial condition could be adversely affected. For further details, please see the chapter entitled “Financial Statements” at page 188. 32. The financial statements of our Company for the previous years may not be comparable to each other. The financial statements of our Company for the Fiscal 2007 is for 15 months ended June 30, 2007 and the financial statements of our Company for the Fiscal 2008 is for nine months ended March 31, 2008. The financial statements of our Company for the Fiscals 2009, 2010 and 2011 are for the 12 months ended March 31, 2009, 2010 and 2011, respectively. Further, our financial year for 2012 has been extended to September 30, 2012. Consequently, our financial statements for these Fiscal Years are not comparable due to different accounting periods and also because of the various schemes of arrangements and acquisitions undertaken by our Company. For further details, please see the chapter entitled “History and Certain Corporate Matters” at page 132. Further, our financial statements for Fiscals 2007, 2008 and 2009 reflect the accounting treatments prescribed in the schemes of arrangements given effect to by our Company as approved by the respective High Courts. For further details of the accounting treatments pursuant to the schemes of arrangements, please see the chapters entitled “History and Certain Corporate Matters – Scheme of Arrangements” and “Financial Statements” at pages 132 and 188, respectively.

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33. We are subject to the risk of theft and fraud / embezzlement by our employees, contractors and customers. We are exposed to the risk of theft and embezzlement by employees, contractors and customers. While we carefully recruit all of our employees and develop and revise appropriate procedures for the handling and transportation of cash, equipment and intellectual property materials, we cannot assure you that our employees and customers will not commit any acts of theft or embezzlement against us. The occurrence of any such acts could adversely affect our reputation, business and financial condition. Further, in the recent past, one of our contractors Laurent & Benton from whom we sourced human resources committed a fraud on the contract labour employees aggregating approximately `294.20 lakhs. We have issued a legal notice to the said contractor but we have not received a response from it. Should the contractor not be traced we may be required to make compensate Laurent & Benton’s employees, which we may not be able to recover from Laurent & Benton. 34. If our information technology systems are disrupted, our business and financial condition may be adversely

affected. The day-to-day operations of our cinema theatres involve the use of information technology systems, including the processing of advance bookings, ticket sales and billing processes. We also rely on our information technology systems for the carrying out of routine corporate activities, such as the processing of financial information and the management of our accounts. Any disruption of our information technology systems may adversely affect our business, financial condition and results of operations. 35. If there is a dispute or a strike within the Hindi or United States film industry, our business may be adversely

affected. In India, the Hindi film industry was significantly affected by a dispute between multiplex operators and film distributors that led to a strike by multiplex operators between April 2009 and June 2009. The said strike adversely impacted our ability to exhibit any Hindi films in our multiplexes. Although the strike was eventually resolved, our domestic theatrical exhibition revenues suffered. Our theatrical exhibition revenue, on a standalone basis, was significantly lower during the quarter ended June 2009 as compared to the corresponding period in year 2008. We cannot assure you that a strike will not occur in the future or that it will be resolved on terms favourable to us. If such a strike occurs, our business, financial condition and results of operations could be adversely affected. In the United States, the film industry was significantly affected by a strike conducted by the United States’ two major writers’ guilds between November 2007 and February 2008 as a result of the guilds’ dispute with the Alliance of Motion Picture and Television Producers. During and after this period, the production of certain films was significantly disrupted or completely halted. As a result, the release dates of certain films were delayed, the production of certain films and their final content were adversely affected and the financing arrangements regarding certain films were disrupted or terminated. Such a strike could adversely affect the operations of our subsidiary located in the United States, Lowry Digital, which provides various film production services to American film productions. We cannot assure you that a strike related to the American film industry will not occur in the future or that such a strike will be resolved in a manner that does not adversely affect the operations of Lowry Digital. If such a strike occurs, our business, financial condition and results of operations could be adversely affected. 36. If film distributors delay in providing us films or do not enter into agreements with us for the distribution of

their films, our business and results of operations could be adversely affected. We rely on film distributors to supply the films that we exhibit at our cinema theatres. We cannot assure you that we will be able to enter into agreements with all film distributors from whom we wish to source films or that film distributors will supply us films under our agreements in a timely manner. As a result, we may be unable to exhibit films in our cinema theatres as desired or expected. If film distributors delay in providing us their films or do not enter into agreements with us for the distribution of their films, our business and results of operations could be adversely affected.

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37. We have no prior experience in establishing or operating film studios. We are in the process of establishing an approximately 200,000 square feet film studio in Film City, Mumbai. A part of this studio was completed in January 2011 and we expect to complete the remaining portion of the film studio by March, 2013. While we have been operating one studio since January, 2011, we have not in the past established or operated film studios. Our film studios may be subject to various operational risks, such as unexpected maintenance or technical problems, accidents, power interruptions or equipment failures. Due to our lack of experience in operating film studios, we may be unable to prevent or address such risks appropriately. Further, any film studio that we establish and operate may not perform as expected. Any failure to successfully operate film studios may adversely affect our business, financial condition and results of operations. 38. We operate our theatrical exhibition and film productions services businesses in India and overseas, which

entails certain risks. We operate our theatrical exhibition and film productions services businesses in several foreign jurisdictions in addition to India. As of June 30, 2012, we operated our theatrical exhibition business in India, Malaysia, Nepal and the United States, with 262 screens in India and an additional 230 screens overseas. In addition we operate our film post production services through production laboratories in Mumbai, Chennai, Kolkata and London and our creative services through facilities in Burbank (United States), London (U.K) and Navi Mumbai (India). As we operate in various jurisdictions around the world, we are subject to laws, rules and regulations in the jurisdictions in which we operate our theatrical exhibition and film productions services businesses. The laws, rules and regulations applicable in these jurisdictions generally vary from each other and we may be required to obtain additional certifications or approval in certain jurisdictions. We may also be required to make changes to the manner in which we conduct our operations to comply with the applicable laws in these jurisdictions. In the event that we are unable to comply with the requirements under the applicable laws, rules or regulations of the jurisdictions in which we operate, we may face actions and claims against us. This may have adverse effect our business, results of operations and financial conditions. Further, any failure to manage our overseas business operations effectively or balance our management’s attention and resources between our Indian and overseas business operations may adversely affect our business, financial condition and results of operations. 39. We face certain risks related to our handling of inflammable materials, including film rolls. We work with certain inflammable materials in the course of our business, including film rolls. Despite compliance with requisite industry safety standards, our operations are subject to hazards associated with the handling of these inflammable materials. If improperly handled or subjected to unsuitable conditions, these materials could be destroyed and may also cause damage to our properties. The loss of such materials due to fire could cause us to fail to deliver certain film materials in a timely manner, or at all, which could adversely affect our business, financial condition and results of operations. 40. Some viewers or civil society organisations may find the film or television content we exhibit or produce to be

objectionable. It is possible that some viewers in India or overseas may object to certain film or television content exhibited or produced by us based on religious, political, ideological or any other positions held by such viewers. This is particularly possible with regard to content that is graphic in nature, including violent or romantic scenes and films that are politically oriented or targeted at a particular segment of the public. Viewers or civil society organisations, including interest groups, political parties, religious or other organisations may assert legal claims, seek to ban the exhibition of film at our cinema theatres or television content, protest against us or films in our cinema theatres or television programs, damage our facilities, disrupt our operations or object in a variety of other ways. The occurrence of any of these risks could damage our reputation and have an adverse effect on our business, prospects, financial condition and results of operations. The films exhibited by us and television content that we produce could result in claims being asserted, prosecuted or threatened against us based on a variety of grounds, including, among others, defamation, hurting religious sentiments, invasion of privacy, negligence, obscenity or facilitating illegal activities, any of which could have an adverse effect on our business, financial condition and results of operations.

24

41. Our liabilities may not be fully covered by insurance policies, which may expose us to substantial costs that could adversely affect our business, financial condition and results of operations.

We maintain insurance for each of our properties which we believe is typical in our industry and in amounts which we believe are commercially appropriate for a variety of risks, including for losses incurred due to terrorism, fire, flood, earthquake allied perils and burglary and loss of profit due to fire in our cinema theatres. Additionally, we maintain insurance related to commercial general liability, cash and equipment in transit as well as coverage for various items of equipment. However, such insurance may not be adequate to cover all losses or liabilities that may arise from our operations, particularly when the loss suffered is not easily quantifiable. Even if we have availed of adequate insurance cover, we may not be able to successfully assert our claims for any liability or loss under the relevant insurance policies. Additionally, there may be various other risks or losses for which we are not insured either because such risks are uninsurable or not insurable on commercially acceptable terms. For example, we do not carry insurance for certain types of losses, such as those due to war. We also do not maintain a key man or directors’ liability insurance. Should an uninsured loss occur, we could incur substantial losses. In addition, even if any such loss is insured, we may be required to pay a significant deductible on any claim for recovery of such a loss prior to our insurer being obligated to reimburse us for the loss, or the amount of the loss may exceed the limit of our coverage. Further, if an accident resulting in personal injury to a patron or other third party at one of our cinema theatres occurs, even if we hold sufficient insurance cover for the liability, our reputation may be adversely affected. If an uninsured loss or a loss in excess of an insured limit occurs, our business, financial condition and results of operations may be adversely affected. Furthermore, we cannot assure you that in the future we will be able maintain insurance of the types or at levels which we deem necessary or adequate. 42. Restrictions on ticket prices imposed in certain states of India may adversely affect our results of operations. Cinema theatres in the states of Delhi, Punjab, Haryana Tamil Nadu and Andhra Pradesh are subject to regulations under which the ticket prices are required to be approved by the licensing authority, and such prices may be increased only with the prior sanction of the licensing authority. In Tamil Nadu and Andhra Pradesh, the minimum and maximum ticket prices are determined based on facilities in the respective cinema theatres. Further, in Tamil Nadu, we are required to reserve 10.00% of the total approved seating capacity of the cinema theatres for the lowest class depending on the location of the cinema theatres. For the Fiscal 2011 and for the 12 months ended March 31, 2012, cinema theatres in the states of Delhi, Punjab, Haryana, Tamil Nadu and Andhra Pradesh accounted for 26% and 24% of our total theatrical exhibition revenues. As of June 30, 2012, 25 of the 100 cinema theatres operated by us in India are located in these states, representing 57 out of a total of 262 screens in India (including food courts). In the event these restrictions prevent us from increasing the ticket prices as may be required by us, it may affect the results of our operations. 43. We face competition from other forms of media and entertainment. We compete for the public's leisure time and disposable income with other forms of entertainment, including, among others, sporting events, concerts, live theatre and restaurants. The theatrical exhibition industry also faces competition from other forms of out-of-home entertainment, such as concerts, amusement parks and from other forms of in-home entertainment. We also face competition from other forms of media such as radio, cable television, newspapers, and magazines. These alternate forms of entertainment compete with the theatrical exhibition of films to capture the discretionary spending of the patrons and advertisement revenues. 44. We have not entered into definitive agreements to use the Net Proceeds of the Issue. We intend to use the Net Proceeds of the Issue for (i) prepayment/ repayment of our loans availed from our various entities including our Promoters and (ii) general corporate purposes, as described in the chapter entitled “Objects of the Issue” at page 82. Pending utilization of the Issue Proceeds as described in this Draft Letter of Offer, we intend to temporarily invest the funds in high quality interest bearing liquid instruments, including deposits with banks and investments in money market mutual funds and other financial products and investment grade interest bearing securities. Such investments would be in accordance with the investment policies or investment limits approved by our Board of

25

Directors from time to time. Our management will have the discretion to revise our business plan from time to time and consequently our funding requirement and deployment of funds may also change. Further, as the Issue size is more than `50,000 lakhs, a monitoring agency must be appointed. We will appoint a monitoring agency prior to filing of the Letter of Offer. 45. The objects of the Issue include the utilization of the proceeds of the Issue to repay existing loans from one

of our Company’s Promoter.

Our Company intends to use a portion of the Net Proceeds to discharge some of the existing loans availed by our Company from Reliance Capital Limited, one of our Company’s Promoter. To the extent that portion of the existing loans are adjusted as share application money, our Company will not receive fresh funds.

Additionally, if the Company’s other Equity Shareholders do not subscribe to the Issue the proportionate share of equity held by the Company’s Promoters will increase. This will dilute the relative interest of the Company’s other Equity Shareholders. For further details, please see the chapter entitled “Objects of the Issue” at page 82.

46. There are outstanding litigations involving our Company, our Subsidiaries, our Joint ventures, our Directors, one of our Promoters and the Group Companies.

There are various litigations outstanding involving our Company, our Subsidiaries, our Joint Ventures, our Directors, one of our Promoters and our Group Companies. These legal proceedings are pending at different levels of adjudication before various courts, enquiry officers and tribunals. The amounts claimed in these proceedings have been disclosed to the extent ascertainable and quantifiable and include amounts claimed jointly and severally from our Company and other parties. Should any new developments arise, such as any change in applicable Indian law or any rulings against our Company by appellate courts or tribunals, our Company may need to make provisions in its financial statements that could increase expenses and current liabilities. Any adverse decision may have an adverse effect on our Company’s business, results of operations and financial condition. The brief details of such outstanding litigation as of the date of this Draft Letter of Offer are as follows: Litigation against our Company Sr. No.

Nature of litigation Number of outstanding cases

Aggregate approximate amount involved (`̀ in lakhs)*

1. Criminal 1 NA 2. Civil 18 474.18 3. Arbitration 2 6,044.00 4. Tax 24 7,018.82 5. Labour 6 14.53 6. Consumer 3 0.90 7. Stamp duty 1 7.34 8. Notices 4 28.58

*Litigation that is not quantifiable is represented as NA Litigation against our Subsidiaries and Joint Ventures

Sr. No.

Name of Subsidiary/Joint

Venture

Nature of litigation Number of outstanding

cases

Aggregate approximate

amount involved (in lakhs)*

` equivalent of the amount involved calculated as on June 30, 2012

(in lakhs) 1. Reliance

MediaWorks Entertainment Services Limited

Tax 1 `536.88 `536.88

2. Reliance Civil 2 `1.50 `1.50

26

Sr. No.

Name of Subsidiary/Joint

Venture

Nature of litigation Number of outstanding

cases

Aggregate approximate

amount involved (in lakhs)*

` equivalent of the amount involved calculated as on June 30, 2012

(in lakhs) MediaWorks Theatres Limited

3. Reliance MediaWorks (UK)

Civil (Winding-up) 1 £0.63 `55.142

4. Reliance MediaWorks (USA) Inc

Civil 1 US$ 48.70 `2,738.401

5. Reliance MediaWorks (Netherlands) B.V.

Civil 1 €0.54 `38.073

6. Swanston Multiplex Cinemas Private Limited

Criminal 4 `0.20 `0.20

7. Swanston Multiplex Cinemas Private Limited

Labour 1 NA NA

*Litigation that is not quantifiable is represented as NA 1 The exchange rate used for conversion is 1$ = ` 56.23 as at June 30, 2012 2 The exchange rate used for conversion is 1£ = ` 87.53 as at June 30, 2012 3 The exchange rate used for conversion is 1€ = ` 70.50 as at June 30, 2012 Litigation against our Directors

Sr. No.

Name of Director Nature of litigation Number of outstanding cases

Aggregate approximate amount involved*

1. Gautam Doshi Criminal 3 NA 2. Anil Sekhri Criminal 1 NA

*Litigation that is not quantifiable is represented as NA Litigation against our Promoter

Sr. No.

Name of Promoter Nature of litigation Number of outstanding cases

Aggregate approximate amount involved

(`̀ in lakhs)* 1. Reliance Capital Limited Criminal 31 NA 2. Reliance Capital Limited Civil 2 921.00 3. Reliance Capital Limited Investor Related

Disputes (monetary) 218 9.42

4. Reliance Capital Limited Consumer 266 1,120.54 *Litigation that is not quantifiable is represented as NA Litigation against our Group Companies

Sr. No.

Name of Group Company

Nature of litigation Number of outstanding cases

Aggregate approximate amount involved

(`̀ in lakhs)* 1. Reliance Broadcast

Network Limited Civil 15 758.67

2. Reliance Broadcast Network Limited

Tax 1 2.57

27

Sr. No.

Name of Group Company

Nature of litigation Number of outstanding cases

Aggregate approximate amount involved

(`̀ in lakhs)* 3. Reliance Broadcast

Network Limited Labour 5 31.29

4. Reliance Broadcast Network Limited

Stamp Duty 1 8.19

5. Reliance Broadcast Network Limited

Notices 7 1,414.00

6. Reliance Capital Asset Management Limited

Civil 19 150.38

7. Reliance Capital Asset Management Limited

Consumer 27 227

8. Reliance General Insurance Company Limited

Insurance claims 24,080 20,993.87

9. Reliance Securities Limited

Civil 1 1,900.00

10. Reliance Securities Limited

Arbitration 1 26.18

11. Reliance Securities Limited

Consumer 10 60.93

12. Reliance Securities Limited

Tax 2 15.00

13. Reliance Money Express Limited

Civil 1 1.03

14. Reliance Life Insurance Company Limited

Criminal 7 NA

15. Reliance Life Insurance Company Limited

Civil 80 322.74

16. Reliance Life Insurance Company Limited

Arbitration 1 2,109.42

17. Reliance Life Insurance Company Limited

Tax 3 60.33

18. Reliance Life Insurance Company Limited

Labour 7 NA

19. Reliance Life Insurance Company Limited

Consumer 548 1,682.00

20. Reliance Life Insurance Company Limited

Insurance claims 3,330 NA

21. Reliance Life Insurance Company Limited

Notices 580 377.00

22. Reliance Home Finance Limited

Consumer 6 205.38

*Litigation that is not quantifiable is represented as NA For details, please see the chapter entitled “Outstanding Litigation and Material Developments” at page 524. 47. Some of our Group Companies have incurred losses during the last three financial years.

As set forth below, some of our Group Companies have incurred losses during the last three financial years (as per their unconsolidated financial statements).

28

(` in lakhs) Sr. No. Name of the Group Company Profit / Loss

after tax for the financial year 2010

Profit / Loss after tax for the financial year 2011

Profit / Loss after tax for the financial year 2012

1. Adhar Project Management & Consultancy Private Limited 0.13 10.84 (0.54)

2. QOPPA Trading Private Limited NA (2.20) (3.39)

3. Quant Investment Services Private Limited NA (2.20) 5.17

4. QCAP Trade Private Limited (formerly Valankulam Investments and Trading Private Limited)

NA (2.20) 31.31

5. Reliance Alternative Investments Services Private Limited 1.11 4.19 (2.84)

6. Reliance Asset Management (Malaysia) Sdn. Bhd. a (558.04) (1,065.88) (1,124.53)

7. Reliance Asset Management (Mauritius) Limited b (79.33) (297.62) 165.92

8. Reliance Asset Management (Singapore) Pte Limited 70.11 (35.63) (63.86)

9. Reliance Capital (Singapore) Pte. Limited c (0.52) (6.22) (10.37)

10. Reliance Capital Asset Management (UK) Plc. d 490.77 (728.69) (653.25)

11. Reliance Capital Partners (103.85) 3,958.37 3,052.26

12. Reliance Composite Insurance Broking Limited 96.63 605.79 (226.36)

13. Reliance Consultants (Mauritius) Ltd. e (6,66,220.65) (6,00,682.25) 13,24,508.25

14. Reliance Equities International Private Limited (2.18) (2.01) 30.76

15. Reliance Equity Advisors (India) Limited (817.41) 226.44 79.58

16. Reliance Exchangenext Limited (20.57) (108.58) (146.94)

17. Reliance General Insurance Company Limited (5,042.67) (31,160.18) (34,319.96)

18. Reliance Gilts Limited (355.41) 24.31 26.10

19. Reliance Investment Banking Services Limited 4.21 (4.03) (0.45)

20. Reliance Life Insurance Company Limited (28,378.84) (12,929.10) 37,257.13

21. Reliance Money Express Limited (1,677.63) 647.06 714.36

22. Reliance Money Precious Metals Private Limited (formerly Reliance Capital Research Private Limited)

(2.12) (0.16) (0.16)

23. Reliance Share & Stock Brokers Private Limited (164.57) (133.13) (119.13)

24. Reliance Spot Exchange Infrastructure Limited (442.41) (648.47) (550.98)

29

Sr. No. Name of the Group Company Profit / Loss after tax for the financial year 2010

Profit / Loss after tax for the financial year 2011

Profit / Loss after tax for the financial year 2012

25. Reliance Venture Asset Management Private Limited 111.90 (215.00) (36.89)

26. Reliance Wealth Management Limited (2.88) (93.77) (286.59)

27. Viscount Management Services (Alpha) Limited 9,754.92 9,332.57 NA(7)

28. Viscount Management Services Limited (7,400.29) (7,144.15) (7,996.32)

29. Indian Agri Services Private Limited NA NA (5.56)

(1) N.A. indicates profit during that financial year. (2) QOPPA Trading Private Limited was incorporated on February 28, 2011. (3) Quant Investment Services Private Limited was incorporated on March 18, 2011. (4) Reliance Asset Management (Malaysia) Sdn. Bhd. was incorporated on February 20, 2009. (5) Reliance Wealth Management Limited was incorporated on January 1, 2009. (6) Valankulam Investments & Trading Private Limited was incorporated on March 1, 2011. (7) Viscount Management Services (Alpha) Limited have been amalgamated with Reliance Capital Limited.

a Losses in RM. The exchange rate as on March 31, 2012, used for conversion is RM1= `16.90. b,c,e Losses in USD. The exchange rate as on March 31, 2012, used for conversion is $1= `51.85. d Losses in Pound. The exchange rate as on March 31, 2012, used for conversion is £1=`82.90.

(` in lakhs) Name of the Group Company Loss After Tax

for the financial year 2010(1)

Loss After Tax for six months ended September 30, 2010(1)

Loss After Tax for six months ended March 31, 2011(2)

Loss After Tax for 12 months ended March 31, 2012

Reliance Broadcast Network Limited

(7,612.67) (2,491.73) (1,149.68) (1,952.53)

(1) Pursuant to the board resolution dated October 21, 2010, Reliance Broadcast Network Limited closed its books of accounts as of September 30, 2010 and accordingly the financial year was of six months ending September 30, 2010. (2) Pursuant to the board resolution dated May 5, 2011, Reliance Broadcast Network Limited closed its books of accounts as of March 31, 2011 and accordingly the financial year was of six months ending March 31, 2011.

For details, please see the chapter entitled “Our Group Companies” at page 172 of this Draft Letter of Offer. 48. We have experienced negative cash flows during previous fiscals and any negative cash flows in the future

could adversely affect our financial condition and the trading price of our Equity Shares.

We experienced negative cash flows during previous fiscals as set forth in the tables below:

Standalone: (` in lakhs)

For the 12 months ended

March 31, 2012

Fiscal 2011 Fiscal 2010 Fiscal 2009 Fiscal 2008 Fiscal 2007

Net cash generated from/(used in)

NA NA NA (13,864.35) (2,979.64) (37,902.18)

30

For the 12 months ended

March 31, 2012

Fiscal 2011 Fiscal 2010 Fiscal 2009 Fiscal 2008 Fiscal 2007

Operating Activities Net cash generated from / (used in) investing activities

NA (7,987.20) (51,893.66) (2,062.80) (62,182.09) NA

Net cash flow (used in) / generated from financing activities

(17,604.60) NA NA NA NA NA

Only negative cash flows have been disclosed. Positive cash flow during any fiscal has been indicated as “NA”. Consolidated:

(` in lakhs) For the 12

months ended March 31, 2012

Fiscal 2011 Fiscal 2010 Fiscal 2009 Fiscal 2008 Fiscal 2007

Net cash generated from/(used in) Operating Activities

(1,245.52) (5,276.62) NA NA NA (16,701.84)

Net cash generated from / (used in) investing activities

NA NA (46,562.73) (23,791.91) (65,782.53) NA

Net cash flow (used in) / generated from financing activities

(17,874.71) NA NA NA NA NA

Only negative cash flows have been disclosed. Positive cash flow during any fiscal has been indicated as “NA”. Any negative cash flows in the future could adversely affect our financial condition and the trading price of the Equity Shares. 49. We have entered into, and may, in future, enter into, related party transactions. We have entered into, and may in the future enter into, certain transactions with our Promoters and Group Companies, including companies engaged in our line of business or in related areas. These transactions were primarily made in the ordinary course of business at arm’s length. It is likely that we will continue to enter into further related party transactions in the future. For details of the related party transactions, please see the chapter entitled “Financial Statements” at page 188. 50. We may raise additional equity capital which may dilute your existing shareholding. Our growth and business strategies may require us to raise additional capital. We may raise such additional capital through a further issue of securities. Any issuance of Equity Shares to persons other than the Equity Shareholders will dilute your existing equity shareholding. Further, we may obtain a funding from our Promoters through an equity infusion. This will also dilute your shareholding.

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External Risk Factors 51. The Indian film exhibition sector is highly regulated and changes in regulations may have an adverse effect

on our business.

The Indian film exhibition sector is highly regulated by both the central and the state governments. These regulations and policies are exhaustive and apply to all aspects of building and safety requirements, specify preconditions to be met for licensing requirements, show tax and entertainment tax registrations and the pre-conditions for grant of exemptions from the payment of entertainment tax. These regulations and policies have an impact on our ability to operate cinemas and the viability of our cinemas in different states. Changes in these regulations may have an adverse effect on our business and may render our business unviable by increasing compliance requirements and compliance costs. 52. The transition to IFRS converged Indian Accounting Standards in India is still unclear and we may be

negatively impacted by such transition.

The Ministry of Corporate Affairs, Government of India, has recently notified that the IFRS converged Indian Accounting Standards (“IND AS”) will be implemented in a phased manner. It was also mentioned that the date of implementation of IND AS will be notified by the MCA at a later date and such date is yet to be notified. Additionally, IND AS has fundamental differences with IFRS and hence financial statements prepared under IND AS may be substantially different from financial statements prepared under IFRS. There can be no assurance that the financial condition, results of operations, cash flow or changes in shareholder’s equity of our Company will not appear materially worse under IND AS than under Indian GAAP. As our Company adopts IND AS reporting, it may encounter difficulties in the ongoing process of implementing and enhancing its management information systems. Moreover, there is increasing competition for the small number of IFRS experienced accounting personnel available once Indian companies begin to prepare IND AS financial statements. There can be no assurance that the adoption of IND AS by our Company will not adversely affect its reported results of operations or financial condition and any failure to successfully adopt IND AS in accordance with the prescribed timelines could have a material adverse effect on our financial position and results of operations. 53. Fluctuation of the Rupee against foreign currencies may have an adverse effect on our results of

operations. While we report our financial results in Indian rupees, portions of our total income, expenses and investments are denominated, generated or incurred in currencies other than Indian rupees. Such foreign currencies include the USD, GBP, MYR and EUR. To the extent that our income, expenditures and investments are not denominated in Indian rupees, exchange rate fluctuations may have an adverse effect on our results of operations and financial condition.

Further, our future capital expenditures and investments may be denominated in currencies other than Indian rupees. Therefore, a decline in the value of the Indian rupee against such other currencies could increase the Indian rupee cost of incurred on such expenditures and investments. The exchange rate between the Indian rupee and various foreign currencies has varied substantially in recent years and may continue to fluctuate significantly in the future. The consolidation of our overseas subsidiaries will also expose us to translation risks which may significantly impact our results of operations and financial condition. Risks Relating to India 54. Political instability or changes in the Government of India could adversely affect economic conditions in

India and consequently our business. We are incorporated in India, derive a significant portion of our revenues from India and a significant portion of our assets are located in India. Consequently, our performance and the market price and liquidity of the Equity Shares may be affected by changes in exchange rates and controls, interest rates, Government policies, taxation, social and ethnic instability and other political and economic developments affecting India. The Government has traditionally exercised and continues to exercise significant influence over many aspects of the economy. Our business and the

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market price and liquidity of the Equity Shares may be affected by interest rates, changes in Government policy, taxation, social and civil unrest and political, economic or other developments in or affecting India. Since 1991, successive governments have pursued policies of economic and financial sector liberalisation and deregulation and encouraged infrastructure projects. The Government in recent years has announced policies and taken initiatives that support the economic liberalisation programme pursued by previous governments. The Government may change policies regarding the rate of economic liberalisation, banks and financial institutions and the film industry, foreign investment and other matters affecting investment in the Equity Shares. A significant change in the Government's policies in the future, in particular, those relating to the film industry in India, could affect business and economic conditions in India, and could also adversely affect our financial condition and results of operations. 55. If communal disturbances, riots or terrorist attacks occur in India, or if regional hostilities increase, our

business, financial condition and results of operations may be adversely affected. India has experienced communal disturbances, riots and terrorist attacks in recent years. If such events recur, our operational and marketing activities may be adversely affected, resulting in a decline in our income. The Asian region has, from time to time, experienced instances of civil unrest and hostilities among neighbouring countries. Hostilities and tensions may occur in the future and on a wider scale. Military activity or terrorist attacks in India, such as the attacks in Mumbai in November 2008, as well as other acts of violence or war could influence the Indian economy by creating a perception that investments in India involve higher degrees of risk. Events of this nature in the future, as well as social and civil unrest within other countries in Asia, could influence the Indian economy and could have an adverse effect on the market for securities of Indian companies, including the Equity Shares. 56. A slowdown in the economic growth in India could adversely affect our business. We derive most of our revenues from operations in India and consequently, our performance and growth is dependent in large part on the state of the Indian economy. Any slowdown in the Indian economy, and in particular in the discretionary spending habits of our customers, could adversely affect our business. 57. A downgrade of India’s sovereign debt rating may adversely affect our ability to raise additional debt

financing. India's sovereign debt rating could be downgraded due to various factors, including changes in tax or fiscal policy, which are outside our control. Such downgrading could cause a change in interest rates or other commercial terms and could adversely affect our ability to raise additional financing as well as our capital expenditure plans, business and financial performance. A decline in this reserve could affect the valuation of the Indian Rupee and could result in reduced liquidity and higher interest rates, which could adversely affect the availability of financing to us. 58. Natural disasters that could severely disrupt the normal operation of our business. Some of the countries in which we operate have, in the past, experienced natural disasters, such as tsunamis and earthquakes. If any of our facilities were to be damaged by a natural disaster, our business operations could be interrupted or delayed, which could adversely affect our business, financial condition and results of operations. 59. An outbreak of an infectious disease or any other serious public health concerns in Asia or elsewhere could

adversely affect our business. The outbreak of an infectious disease in Asia or elsewhere or any other serious public health concern, such as swine influenza, could have a negative impact on the global economy, financial markets and business activities worldwide, which could adversely affect our business. While we have not been adversely affected by such outbreaks in the past, we cannot assure you that a future outbreak of an infectious disease among humans or animals or any other serious public health concerns will not have an adverse effect on our business.

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60. Our ability to raise foreign capital may be constrained by Indian law. As an Indian company, we are subject to exchange controls that regulate borrowing in foreign currencies. Such regulatory restrictions limit our financing sources for our operations and could constrain our ability to obtain financing on favourable terms and refinance existing indebtedness. In addition, we cannot assure you that required approvals will be granted to us without onerous conditions, or at all. Limitations on foreign debt may have an adverse effect on our business, financial condition and results of operations. 61. Our business and activities are regulated by the Competition Act, 2002. The Parliament has enacted the Competition Act, 2002, as amended, (“Competition Act”) for the purpose of preventing practices having an adverse effect on competition in the relevant market in India under the auspices of the Competition Commission of India (“CCI”). Under the Competition Act, any arrangement, understanding or action whether or not formal or informal which causes or is likely to cause an appreciable adverse effect on competition is void and attracts substantial penalties. Any agreement among competitors which directly or indirectly involves determination of purchase or sale prices, limits or controls production, or shares the market by way of geographical area or number of customers in the relevant market is presumed to have an appreciable adverse effect on competition in the relevant market in India and shall be void. Further, the Competition Act prohibits abuse of dominant position by any enterprise. If it is proved that the contravention committed by a company took place with the consent or connivance or is attributable to any neglect on the part of, any director, manager, secretary or other officer of such company, that person shall be guilty of the contravention and liable to be punished. On March 4, 2011 the Government of India notified and brought into force the combination regulation (merger control) provisions under the Competition Act with effect from June 1, 2011. The combination regulation provisions require that acquisition of shares, voting rights, assets or control or mergers or amalgamations which cross the prescribed asset and turnover based thresholds shall be mandatorily notified to and pre-approved by the CCI. In addition, on May 11, 2011, the CCI issued the final Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011 which sets out the mechanism for implementation of the combination regulation provisions under the Competition Act. It is unclear as to how the Competition Act and the CCI will affect the business environment in India. If we are adversely impacted, directly or indirectly, by any provision of the Competition Act, or its application or interpretation, generally or specifically in relation to any merger, amalgamation or acquisition proposed by us, or any enforcement proceedings initiated by the CCI, either suo moto or pursuant to any complaint, for alleged violation of any provisions of the Competition Act it may have a material adverse effect on our business, financial condition and results of operations. Risks Relating to the Investment in the Equity Shares 62. Our ability to pay dividends in the future will depend upon our future earnings, financial condition, cash

flows, working capital requirements, capital expenditures and other factors. The amount of our future dividend payments, if any, will depend upon our future earnings, financial condition, cash flows, working capital requirements, capital expenditures and other factors. There can be no assurance that we will have distributable funds in future periods or that we will pay dividend even if we have distributable profits. 63. The price of our Equity Shares may be volatile. The trading price of our Equity Shares may fluctuate after this Issue due to a variety of factors, including our results of operations and the performance of our business, competitive conditions, general economic, political and social factors, the performance of the Indian and global economy and significant developments in India’s fiscal regime, volatility in the Indian and global securities market, performance of our competitors, the Indian film industry and the perception in the market about investments in the film industry, changes in the estimates of our performance or recommendations by financial analysts and announcements by us or others regarding contracts, acquisitions, strategic partnerships, joint ventures, or capital commitments. In addition, if the stock markets experience a loss of

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investor confidence, the trading price of our Equity Shares could decline for reasons unrelated to our business, financial condition or operating results. The trading price of our Equity Shares might also decline in reaction to events that affect other companies in our industry even if these events do not directly affect us. Each of these factors, among others, could adversely affect the price of our Equity Shares. 64. Any future issuance of Equity Shares by us or sales of the Equity Shares by any of our significant

shareholders may adversely affect the trading price of the Equity Shares. Any future issuance of Equity Shares by us, such as a primary offering or pursuant to a preferential allotment, may dilute your shareholding in us, adversely affect the trading price of our Equity Shares and could affect our ability to raise capital through an issuance of our securities. In addition, any perception by investors that such issuances or sales might occur could also affect the trading price of our Equity Shares. Additionally, the disposal of Equity Shares by any of our significant shareholders or our promoters, any future issuance of Equity Shares by us or the perception that such issuances or sales may occur may significantly affect the trading price of the Equity Shares. We cannot assure you that we will not issue Equity Shares or that such shareholders will not dispose of, pledge or encumber their Equity Shares in the future. 65. The movements in the price of the Equity Shares may be subject to restrictions from time to time, which may

adversely affect a shareholder’s ability to sell, or the price at which it can sell, Equity Shares at a particular point in time.

We are subject to a daily circuit breaker imposed on listed companies by all stock exchanges in India which does not allow transactions beyond certain volatility in the price of the Equity Shares. This circuit breaker operates independently of the index-based market-wide circuit breakers generally imposed by SEBI on Indian stock exchanges. The percentage limit on our circuit breaker is set by the stock exchanges based on the historical volatility in the price and trading volume of the Equity Shares. The stock exchanges are not required to inform us of the percentage limit of the circuit breaker from time to time, and may change it without our knowledge. This circuit breaker would effectively limit the upward and downward movements in the price of the Equity Shares. As a result of this circuit breaker, the ability of shareholders to sell the Equity Shares or the price at which shareholders may be able to sell their Equity Shares may be adversely affected. 66. There is no guarantee that the Equity Shares will be listed on the Stock Exchanges in a timely manner or at

all, and any trading closures at the Stock Exchanges may adversely affect the trading price of our Equity Shares.

In accordance with Indian law and practice, permission for listing and trading of the Equity Shares issued pursuant to the Issue will not be granted until after the Equity Shares have been issued and allotted. Approval for listing and trading will require all relevant documents authorising the issuing of Equity Shares to be submitted. There could be a failure or delay in listing the Equity Shares on the Stock Exchanges. Any failure or delay in obtaining the approval would restrict your ability to dispose of your Equity Shares. 67. You may be subject to Indian taxes arising out of capital gains on the sale of the Equity Shares. Capital gains arising from the sale of the Equity Shares are generally taxable in India. Currently, any gain realised on the sale of our shares on a stock exchange held for more than 12 months will not be subject to capital gains tax in India if the securities transaction tax (STT) has been paid on the transaction. The STT will be levied on and collected by an Indian stock exchange on which our shares are sold. Any gain realised on the sale of our shares held for more than 12 months to an Indian resident, which are sold other than on a recognised stock exchange and as a result of which no STT has been paid, will be subject to capital gains tax in India. Further, any gain realised on the sale of our shares held for a period of 12 months or less will be subject to capital gains tax in India. Capital gains arising from the sale of our shares will be exempt from taxation in India in cases where an exemption is provided under a treaty between India and the country of which the seller is a resident. Generally, Indian tax treaties do not limit India’s ability to impose tax on capital gains. For more information, please see the chapter entitled “Statement of Tax Benefits” at page 91. However, capital gains on the sale of our Equity Shares purchased in the Issue by

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residents of certain countries may not be taxable in India by virtue of the provisions contained in the taxation treaties between India and such countries. As a result, residents of other countries may be liable for tax in India as well as in their own jurisdictions on gains arising from a sale of Equity Shares. 68. You will not be able to sell immediately on the Stock Exchanges any of the Equity Shares you purchase in

the Issue. The Equity Shares will be listed on the Stock Exchanges. Pursuant to Indian regulations, certain actions must be completed before the Equity Shares can be listed and trading may commence. Investors’ book entry, or “demat”, accounts with depository participants in India are expected to be credited within two working days of the date on which the basis of allotment is approved by the Stock Exchanges. Thereafter, upon receipt of final approval from the Stock Exchanges, trading in the Equity Shares is expected to commence within seven working days of the date on which the basis of allotment is approved by the Designated Stock Exchange. We cannot assure that the Equity Shares will be credited to investors’ demat accounts, or that trading in the Equity Shares will commence, within the time periods specified above. Prominent notes 1. Our Company was incorporated on November 30, 1987. For details of change in name of our Company in

the last three years along with reasons thereof and consequent changes to the Memorandum of Association, please see the chapter entitled “History and Certain Corporate Matters” at page 132.

2. Issue of [●] Equity Shares for cash at a premium of ` [●] per Equity Share for an amount not exceeding

`60,000 lakhs on a rights basis to the existing Equity Shareholders of our Company in the ratio of [●] Equity Share(s) for every [●] fully paid-up Equity Share(s) held by the existing Equity Shareholders on the record date, that is on [●]. The Issue Price is [●] times the face value of the Equity Shares.

3. Our net worth as at March 31, 2012 was `(23,958.07) lakhs on a consolidated basis as per our restated

consolidated financial statements prepared under Indian GAAP. 4. There has been no financing arrangement whereby our Promoter Group, our Directors and their relatives

have financed the purchase by any other person of securities of our Company other than in normal course of the business of the financing entity during the period of six months immediately preceding the date of filing of this Draft Letter of Offer.

5. Set out below are the related party transactions entered into by us.

(` in lakhs)

Sr. No.

Particulars Transaction Amount

Transaction Amount

Transaction Amount

Transaction Amount

Transaction Amount

Transaction Amount

12 months ended March 31, 2012

Fiscal 2011 Fiscal 2010 Fiscal 2009 Fiscal 2008 Fiscal 2007

1 Holding Companies - - - - 546.38 523.17

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Sr. No.

Particulars Transaction Amount

Transaction Amount

Transaction Amount

Transaction Amount

Transaction Amount

Transaction Amount

12 months ended March 31, 2012

Fiscal 2011 Fiscal 2010 Fiscal 2009 Fiscal 2008 Fiscal 2007

2 Significant Shareholders, key managerial personnel and their relatives 23.9 10.8 17.8 7.8 179.7 348.47

3 Fellow Subsidiaries - - - - - 33,310.72

4 Enterprises over which Company has significant influence / associates (12.90) 15.80 262.90 414.37 753.51 4,715.33

5 Enterprises over which Key Managerial personnel have significant influence - - - - - 451.57

6 Other related parties - - - - - 257.44

For further details about our related party transactions, please see the chapter entitled “Financial Statements” at page 188.

6. Investors may contact the Lead Manager for complaints, information or clarifications pertaining to the

Issue.

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SECTION III: INTRODUCTION

SUMMARY OF INDUSTRY

The following is a summary of the industry overview. This summary should be read in conjunction with, and is qualified in its entirety by, more detailed information in the chapter entitled “Industry Overview” at page 99. We have relied on websites and publicly available documents from various sources. The data may have been re-classified by us for the purpose of presentation. Neither we nor any other person connected with the Offer has independently verified the information provided in this chapter. Industry sources and publications, referred to in this section, generally state that the information contained therein has been obtained from sources generally believed to be reliable but their accuracy, completeness and underlying assumptions are not guaranteed and their reliability cannot be assured, and, accordingly, investment decisions should not be based on such information. Overview of the Indian Economy India is one of the fastest growing economies in the world with a rapidly expanding entertainment and media (“E&M”) industry. According to the Ministry of Statistics and Programme Implementation’s (MOSPI) revised estimates, India’s real GDP registered a lower growth of 6.9% during Fiscal 2012, as compared with 8.4% in Fiscal 2011, largely attributable to global factors include in particular, the crisis in the euro zone area and near recessionary conditions prevailing in Europe, slow growth in many other industrialized countries, increase in crude price rate, etc. However, relative to many other economies in the world, growth of 6.9 per cent in India is among the highest. The following table illustrates India's real GDP growth between financial years 2009 and 2012 (at factor cost at constant 2004- 2005 prices):

Fiscal 2009 Fiscal 2010 Fiscal 2011 Fiscal 2012 Real GDP Growth Rate (%) 6.7% 8.4% 8.4% 6.9%

Source: Ministry of Statistics and Programme Implementation Overview of the Indian Entertainment and Media Industry The Indian E&M industry (primarily comprised, among others, of film, television, print media, animation and visual effects (“VFX”), radio and music) has witnessed steady growth in recent years and is estimated to have reached ` 72,80,000 lakhs in 2011. The Indian E&M industry is projected to grow at a compound annual growth rate (“CAGR”) of 14.90% from the year 2011 to the year 2016 to reach `1,45,70,000 lakhs. The Indian E&M industry has grown at a CAGR of 9.09% between 2007 and 2011. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) The following factors are expected to contribute to further growth of the Indian E&M industry: The continued growth and development of the Indian economy; Favourable demographic characteristics and trends in India; The cultural diversity of the Indian population; The internationalisation of the Indian E&M industry; The availability of popular content; and Digitisation of content.

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The following table provides the expected sizes and growth rates of the various segments of the Indian E&M industry for the years 2011 through 2016:

(`̀ lakhs) E&M Industry Segment 2011 2012P 2013P 2014P 2015P 2016P

CAGR (2011 to 2016)

T.V. 3290000 3800000 4350000 5140000 6180000 7350000 17.00% Print 2088000 2260000 2468000 2700000 2949000 3234000 9.00% Film 929000 1000000 1097000 1211000 1345000 1503000 10.00% Radio 115000 130000 160000 200000 240000 295000 21.00% Music 90000 100000 113000 131000 154000 182000 15.00% O.O.H. 178000 195000 215000 236000 260000 290000 10.00% Animation 310000 363000 430000 511000 610000 690000 17.00% Gaming 130000 180000 230000 290000 370000 460000 29.00% Digital Advertising 154000 199000 258000 335000 437000 570000 30.00% Total 7284000 8227000 9321000 10754000 12545000 14574000 14.90% *P=Projected (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”)

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SUMMARY OF BUSINESS

The following is a summary of our business. This summary should be read in conjunction with, and is qualified in its entirety by, more detailed information in the chapter entitled “Business” at page 111. Overview We are one of India’s leading entertainment and media (“E&M”) companies with a presence across several businesses such as theatrical exhibition of films, film and media services and television content production and distribution. Our headquarters are located in Mumbai and we have operations across 78 cities and towns in India and internationally, in Malaysia, Nepal, the UK and the United States. Our theatrical exhibition business is our largest source of revenue. We operate one of India’s largest cinema chains, under the brand ‘BIG Cinemas’, with 262 screens in India and an additional 230 screens in Nepal, Malaysia and the United States as of June 30, 2012. During the 12 months ended March 31, 2012, BIG Cinemas catered to approximately 338 lakhs and 57 lakhs consumers in India and overseas, respectively. Our film and media services business comprising production, post-production services and creative services for films and television is our second largest source of revenue, which comprises: Production services: We lease sound stages, shooting floors, standard and high definition multi-camera

equipment and other related equipment to television and film production companies.

Post-production services: We process film negatives at our laboratories located in Mumbai, Chennai, Kolkata and London and trade film negatives in India. Our 4K digital intermediate (“DI”) laboratory located in Film City, Mumbai undertakes quality enhancement of film and television content through digital techniques.

Creative Services: We are also engaged in the film restoration business through our subsidiary, Digital Media Imaging Limited. We also provide creative services such as VFX, conversion of 2D content to 3D and computer-generated imagery (“CGI”). In addition, our subsidiaries located in United States and UK, Lowry Digital and Reliance MediaWorks (UK) Limited, respectively, are engaged in the business of digital image correction, film restoration and film processing.

We operate our film post production services through production laboratories in Mumbai, Chennai, Kolkata and London and our creative services through facilities in Burbank (United States), London (U.K) and Navi Mumbai (India). Films processed at our laboratory in Mumbai have won, among others, 14 national awards for cinematography and our Company’s film processing facilities have been certified by Kodak Imagecare, an internationally recognised quality certification program, for each of the years beginning 2005. We were among four companies to receive the “Judges Award for Creativity & Innovation in Post-Production” at the Hollywood Post Alliance Awards in 2010. In August 2011, our Company received a patent for an innovation – “System and method for removing semi-transparent artifacts from digital images caused by contaminants in the camera’s optical path”. Our Company was the first Indian company to be recognized in the category of science and technology for the development of a unique and efficient system for the reduction of noise and other artefacts which provide a high quality image required for the film making process at the Academy of Motion Pictures, Arts and Science Awards 2012. As a part of our long term growth strategy of asset creation, during the previous four years, we have established:

a business process outsourcing (BPO) facility at Navi Mumbai; post-production facilities for television commercials and broadcast; and a DI Lab.

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Further, we have purchased broadcast and film cameras. We’ve also increased the number of screens we operate. This has been achieved organically and has enhanced our reach in terms of exhibition business and also enabled us to strengthen our capabilities in post-production services and creative services divisions. We are also in the process of establishing an approximately 2,00,000 square feet film studio located in Film City, Mumbai with facilities for shooting films, television shows and television commercials, which we believe meets international standards. This studio aims to provide a one-stop solution for all production needs for domestic and international clients. When completed, the studio is expected to have eight sound stages with appropriate noise control and other features. A part of the film studio constituting three sound stages was completed in January 2011. We expect to complete the remaining portion of the film studio by March 2013. We are also engaged in the business of television content production under the brand “BIG Synergy”, which primarily produces non-fiction programmes in addition to adapting international programme formats for Indian viewers. We have produced shows such as Kaun Banega Crorepati, Kya Aap Paanchvi Paas Se Tez Hai, Duss Ka Dum, India’s Got Talent, Aap Ki Kachehri - Kiran Bedi Ke Sath and Sach Ka Saamna. We also selectively distribute films. For the 12 months ended March 31, 2012 and Fiscal 2011, our restated consolidated net loss after tax was `57,216.63 lakhs and `32,796.95 lakhs, respectively. For the 12 months ended March 31, 2012 and Fiscal 2011, our consolidated total income was `83,472.70 lakhs and `85,026.20 lakhs, respectively. Our competitive strengths We believe the following are our key competitive strengths: Strong reputation and brand in the E&M Sector We believe that we have established ourselves as having a strong reputation and brand in the E&M sector. We have rebranded our theatrical exhibition and our television content production businesses as “BIG Cinemas” and “BIG Synergy”, respectively. This rebranding was undertaken in order to create a single E&M brand, “BIG”. During the 12 months ended March 31, 2012, BIG Cinemas catered to approximately 338 lakhs and 57 lakhs consumers in India and overseas, respectively. We have received various awards for our theatrical exhibition business, including “Most Admired Innovative Concept of the Year” at the Images Retail Forum 2010 for our Ciné Diner theatre exhibition concept, which was also placed second at the Interior & Architecture Design Awards in 2009 in the “Best Interior Design – Hospitality” category. We also received the “Most Admired Retailer in Entertainment” award at the India Retail Awards in 2009, which we also received in 2007. We received the “Exhibitor of the Year” award at the CineAsia 2008 awards and were named “Retailer of the Year” in the “Entertainment” category for the second consecutive year at the India Retail Summit in 2007. The Silent National Anthem campaign launched by Big Cinemas has bagged one silver in the PR Lions category and two bronze lions in Promo & Activation category in 2011. Our BIG Synergy brand, under which we produce television content, has produced television shows such as Kaun Banega Crorepati, Kya Aap Paanchvi Paas Se Tez Hai, Duss Ka Dum, India’s Got Talent, Aap Ki Kachehri - Kiran Bedi Ke Sath and Sach Ka Saamna. Many of these shows received high viewer ratings and have occupied leadership positions among their programme categories. Additionally, through Lowry Digital, we believe we have one of the leading digital image correction and restoration facilities in the world. Lowry Digital’s clients include industry leaders such as Walt Disney Pictures & Television and Warner Bros. Entertainment Inc. Lowry Digital’s facility has provided image enhancement and restoration services to approximately 500 films as of March 31, 2012 and has worked on classics such as Casablanca, Singin’ in the Rain, Sunset Boulevard and a number of Walt Disney Pictures & Television classics such as Cinderella, Bambi, George of the Jungle, Snow White, Fantasia, Tron, Tangled, Winnie the Pooh, Beauty and the Beast and 101 Dalmatians.

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We believe in partnering with leading media companies in Hollywood to establish our foothold in the post production services space. We believe that our relationship with Digital Domain, an Academy Award-winning digital production studio in Hollywood, for outsourcing work on VFX and Conversion in India and UK demonstrates our quality and efficient workflow processes as well as strong brand repute. We believe that our longstanding presence in the film processing business has made us one of the important operators in the Hindi film category in addition to being a key operator in certain regional language films. Films processed at our laboratory located in Mumbai have won, among others, 14 national awards for cinematography and its film processing facilities have been certified by Kodak Imagecare, an internationally recognised quality certification program, for each of the years beginning 2005. We believe we have established a strong reputation and brand through the quality of our products and services which have obtained industry recognition and customer satisfaction. We believe that our strong reputation and brand differentiates us from our competitors. Demonstrated ability to expand our operations both organically and inorganically We have created a global E&M company that is capable of operating across the entire E&M business value chain. Since the Reliance Group acquired control of our Company in the financial year 2006, we have grown and diversified our business. Our revenues have grown from `13,111.95 lakhs for the financial year 2006 to approximately `83,472.70 lakhs for the 12 months ended March 31, 2012. Currently, we have diversified service offering across several businesses, such as theatrical exhibition of films, film and media services and television and content production and distribution. Our theatrical exhibition business has expanded from 32 screens across five cities as of March 31, 2006 to 492 screens across more than 110 towns and cities in India, Nepal, Malaysia and the United States, as of June 30, 2012. Our employee base, comprising of professionals with more than 10 years of experience has grown significantly from 14 employees in the financial year 2006 to 121 employees till March 31, 2012. As part of our ongoing strategy to expand our theatrical exhibition business, we have adopted a price differentiation model, which we believe has increased our patronage by offering our patrons an enhanced cinema experience at each price point. Most of our cinema theatres are located in highly populated areas providing convenient access to our target customers, which are upper-income and middle-income households. From a customer base of approximately 129 lakhs consumers in India for the financial year 2008, BIG Cinema has grown to approximately 395 lakhs consumers across India and overseas for the 12 months ended March 31, 2012. Through our television content production brand, “BIG Synergy”, we have demonstrated our ability to produce highly popular programmes such as Kaun Banega Crorepati and Duss Ka Dum including adapting international programme formats for Indian viewers. We have also demonstrated our ability to acquire companies located in India and overseas in order to consolidate our position as a company that is capable of operating across the entire E&M business value chain. For example, we have acquired Rave Entertainment Private Limited (“Rave”), Synergy Communications Private Limited (now known as Big Synergy Media Limited), iLab and Lowry Digital between the financial years 2007 and 2009. Acquisition of Rave helped us in establish our footprint in the North Indian cinema territories, while Synergy Communications Private Limited has facilitated our entry into the business of television content production and Lowry and iLab have helped us establish our presence in the North American and European markets, offering us new business opportunities such as image processing and restoration, 2D to 3D conversion and VFX. Presence across various E&M businesses and geographies We believe we are a one-stop solution provider for film and television producers and distributors in India. We provide the entire range of film services, including film studio rental, film equipment rental, DI post-production laboratory services, film processing, digital cinema mastering and operating exhibition theatres in various countries. Our presence across various businesses allow us to develop long-term relationships as we are able to cross-sell our various services and offer solutions for the varying requirements of our customers.

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Our strategy is to create a single global E&M company that is capable of operating in geographically diverse markets and catering to a variety of consumers. We have expanded our operations by acquiring theatrical exhibition assets overseas and, we own and operate 262 screens in India and 230 screens in Nepal, Malaysia and the United States as of June 30, 2012. We have also established a presence in the film post-production services business in the United States and the UK through the acquisition of Lowry Digital and iLab, respectively. We believe that our multinational presence makes us an attractive proposition for our customers. Our technological capabilities We have attempted to develop or acquire the latest technological capabilities across our business lines to ensure that we remain competitive. In our film production services business, we utilise various sophisticated technologies, including digital camera technology capable of recording high-definition video, sync-sound enabled studio stages and fibre optic cables for the distribution of films. Our film processing laboratory, through its telecine scanners, enables us to capture the fine details of a filmed image. We are capable of grading the film in an uncompressed 4K resolution, the highest available resolution for film production. We utilise proprietary image processing technology to deliver superior picture elements and have developed a unique technology, the “Lowry Process”, which is used to create high image quality for all outputs, including film, broadcast television, advertisements, digital cinema, Blu-Ray Disc and Internet video. Lowry Digital’s services include film restoration, emergency image repair, digital blow-ups and DI enhancements. Lowry Digital also offers image enhancement tools which are used for the restoration and upgrade of damaged analogue film prints. We were among four companies to receive the Creativity and Innovation Hollywood Post Alliance Award in November 2010. In August 2011, our Company received a patent for the following innovation – “System and method for removing semi-transparent artifacts from digital images caused by contaminants in the camera’s optical path”. Our Company was the first Indian company to be recognized in the category of science and technology for the development of an unique and efficient system for the reduction of noise and other artefacts which provide a high quality image required for the film making process at the Academy of Motion Pictures, Arts & Science Awards 2012. We also introduced the 6D multi-sensory cinema experience in India in 2008. We introduced the IMAX digital projection system in India in 2001, which has enabled us to take advantage of the increasing number of IMAX and IMAX 3D releases. Some of our cinema theatres feature digital cinema projectors that, in addition to displaying films, are also capable of displaying digital 3D images and non-film content such as opera and cricket matches. The Reliance Group’s brand, experience and position in India and Overseas The Reliance Group is a diversified business group with a strong brand, level of experience and position in India and overseas. The Reliance Group is headed by Anil Dhirubhai Ambani, one of India’s leading entrepreneurs, who has won several awards such as “Person of Year – 2008” by Light Readings for outstanding achievements in the telecommunications industry and “Businessman of the Year” in a poll conducted by The Times of India in 2006. Reliance Communications Limited, one of the leading wireless carriers in India in terms of coverage and capacity and Reliance Capital Limited, one of the leading private sector financial services companies in India are part of the Reliance Group. The Reliance Group also includes Reliance Power Limited, one of India’s leading power development companies. The Reliance Group has a large presence in the entertainment, communications and infrastructure sectors and we derive significant benefits from our association with the group. For example, we are able to derive benefits of synergy in approaching advertisers through our relationship with Reliance Broadcast Network Limited, a group company which owns 92.7 Big FM, one of India's leading radio networks, and BIG Street, an out-of-home media business. We believe that we will continue to benefit from the depth of experience of the Reliance Group and our association with the Reliance Group significantly enhances our brand value. Our Business Strategy Our business strategy is to build upon our competitive strengths and business opportunities to continue to be a leading E&M company. Our business strategy consists of the following principal elements:

43

Continue to focus on increasing our revenue from film and media services While we continue to focus on film and media services we intend to expand our service offerings in line with technological developments and market demand. For instance, we commenced production services business with equipment rental and have extended our service bouquet by building a state-of-the-art film studio in Film City, Mumbai, comprising of three film studios with eight sound stages, which we believe will significantly strengthen our ability to provide film production services. While a part of the film studio constituting three sound stages was recently completed, we expect to complete the remaining portion of the film studio by March 2013. We have also extended our BPO offerings from restoration and content processing to VFX, 2D to 3D conversion and CGI. Create lean front-end centers in overseas markets and substantial back-end delivery centres in India for film and media services Hollywood produces maximum number of high budget films with high expenditure on VFX and 3D conversions. However, the cost of production in US is almost four times as compared to India (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2009”). We have identified this opportunity and mapped the demand with supply. We have created strategic front-ends in the markets of US (Burbank) and UK (London), complimented by back-end delivery centres in India, one of which is located in a SEZ. The front-end centers in US and UK focus on business development and hence are lean on assets. We intend to continue to focus on further enhancing strategic front-end tie-ups backed by increasing back-end asset creation in India, where our main delivery centres are located. Opportunistically expand our theatrical exhibition business The key elements of our growth strategy for our domestic theatrical exhibition business include the following: Focussing on select metro and tier 1 cities which we believe could potentially have a higher consumption

pattern; and Expanding in certain select locations to establish a footprint or to strengthen our presence in identified film

territories. A retail centric approach, to enhance the profitability of our theatrical exhibition business Our key focus in improving the profitability of our theatres is through increasing patronage and improving the overall customer experience, which we believe will lead to greater spending by customers, allow us to command greater premiums in our ticket prices and increase advertising revenues. We seek to achieve this through the following: Enhancing our understanding of our customer to enable us to customise our programme selection. Further,

we propose to introduce movie and time specific pricing to increase admits and, consequently, box office collections;

Offering the customer a wider F&B choice and providing the customer greater access to F&B option in-theatre i.e. within the precincts of the auditorium;

Augmenting our advertising sales by better utilising the available on-screen and off-screen space; Delivering consistent customer experience, in line with our proposition of delivering an affordable luxury

experience to larger pool of customers, whilst keeping a tight control on costs; and Explore avenues for rent rationalisation, in the context of the changing market environment.

Grow our business through internal restructuring We continue to evaluate various opportunities for the growth of our business. In order to garner further investments with an aim to raise fresh capital for the growth of our business, we are considering restructuring certain of our business divisions i.e. film and media services business and exhibition business, including by transferring them to

44

our subsidiaries. We may also consider options for entering into technical and financial collaboration with strategic partners either directly or through our subsidiaries. For further details please see the chapter entitled “History and Certain Corporate Matters” at page 132. Continue to pursue strategic acquisitions and alliances We have expanded our operations by identifying and carrying out strategic acquisitions/alliances. The goals that we hope to achieve through such strategic acquisitions/alliances include: the expansion and enhancement of our businesses; the benefit of technical and operational synergies; and the expansion of our geographical reach.

We intend to continue to evaluate such options even in the future.

45

SUMMARY FINANCIAL INFORMATION

The following is a summary of the financial information. This summary should be read in conjunction with, and is qualified in its entirety by, more detailed information in the section entitled “Financial Information” at page 188.

Summary statement of assets and liabilities of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Assets

A Non-current assets

I Fixed assets (i) Tangible assets 103,273.41 111,782.74 104,933.32 80,215.84 40,666.60 15,762.08 (ii) Intangible

assets 8,342.76 8,804.20 6,034.60 3,249.60 18,251.60 4,181.66 (iii) Capital work-

in-progress 13,817.90 15,029.90 24,538.92 21,203.60 21,331.01 14,982.58 (iv) Intangible

assets under development - - 132.51 - - -

II Goodwill on

consolidation 8,204.52 8,819.42 8,728.62 4,202.56 2,746.76 2,245.28 III Non-current

investments 575.92 1,092.99 1,272.41 1,161.72 6,991.37 7,268.16 IV Deferred tax assets

(net) 0.80 2.60 2.20 18.70 64.40 - V Long-term loans

and advances 25,825.50 29,371.37 27,167.99 24,818.29 29,293.35 8,988.13 VI Other non-current

assets 52.10 389.30 277.42 59.41 43.75 5,117.75 160,092.91 175,292.52 173,087.99 134,929.72 119,388.84 58,545.64 B Current assets I Current

investments - 10.44 7,902.30 - 13,556.71 98.38 II Inventories 1,111.50 1,325.30 907.20 690.50 761.30 209.93 III Trade receivables 21,405.10 21,600.60 23,230.60 21,031.70 12,141.50 5,895.29 IV Cash and bank

balances 8,273.80 11,772.99 8,270.97 7,881.99 12,376.49 11,194.26 V Short-term loans

and advances 13,746.00 13,202.01 36,566.65 34,879.67 25,024.61 40,236.43 VI Other current

assets 5,791.60 5,570.80 2,789.90 4,401.30 4,027.96 116.20 50,328.00 53,482.14 79,667.62 68,885.16 67,888.57 57,750.49 Liabilities C Non-current

liabilities

46

Summary statement of assets and liabilities of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 I Long-term

borrowings 61,850.60 44,430.11 40,405.00 57,360.46 53,099.90 46,158.40 II Deferred tax

liabilities (net) 6.09 516.39 63.39 66.59 192.03 1,408.19 III Other long-term

liabilities 5,263.90 2,909.05 1,468.90 871.85 342.98 244.96 IV Long-term

provisions 620.10 774.71 383.20 3,434.40 3,038.99 10,216.63 67,740.69 48,630.26 42,320.49 61,733.30 56,673.90 58,028.18 D Minority interest 1,634.08 1,347.88 1,736.58 3,006.58 1,621.78 1,460.06 E Current liabilities I Short-term

borrowings 57,102.80 103,178.16 117,402.75 72,109.67 41,319.22 12,503.15 II Trade payables 19,622.45 12,935.97 11,088.28 8,287.62 9,004.13 3,356.39 III Other current

liabilities 88,024.46 59,759.57 44,224.02 9,204.87 9,049.62 4,681.57 IV Short-term

provisions 254.50 215.99 165.91 230.40 1,826.01 1,187.26 165,004.21 176,089.69 172,880.96 89,832.56 61,198.98 21,728.37 F Net Worth (A+B-

C-D-E) (23,958.07) 2,706.83 35,817.58 49,242.44 67,782.75 35,079.52 G Represented by i) Share capital 2,453.80 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04 ii) Reserves and

surplus (net) (26,411.87) 400.53 33,511.28 46,936.14 65,476.45 33,089.48 H Net worth ( i+ ii ) (23,958.07) 2,706.83 35,817.58 49,242.44 67,782.75 35,079.52 The above statement should be read together with significant accounting policies and notes to summary statement of assets and liabilities, as restated, of the Group (Annexure IV)

47

Summary statement of profit and loss of the Group, as restated (` in lakhs)

Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Revenue from operations 81,744.90 79,207.40 71,507.20 65,935.34 30,768.94 35,541.47 Other income 1,727.80 5,818.80 3,256.70 7,184.90 5,527.80 7,583.95 Total revenue 83,472.70 85,026.20 74,763.90 73,120.24 36,296.74 43,125.42

Direct operational expenses 32,615.60 31,059.80 28,102.00 23,868.30 9,792.00 12,276.42 Employee benefits expense 21,741.10 20,979.80 13,179.30 10,147.60 2,605.10 2,308.02 Finance costs (including loss on derivative contracts) (net) 28,505.17 17,514.20 11,717.20 12,447.20 2,905.24 618.06 Depreciation, amortisation and impairment expense 14,159.10 13,226.50 9,729.44 13,542.41 10,153.62 9,450.22 Other expenses 43,279.95 34,672.96 25,317.05 20,056.90 7,914.65 7,192.71 Total expenses 140,300.92 117,453.26 88,044.99 80,062.41 33,370.61 31,845.43 (Loss) / profit before tax and minority interest (56,828.22) (32,427.06) (13,281.09) (6,942.17) 2,926.13 11,279.99 less - Provision for taxes - Current tax 460.00 113.90 39.61 414.91 228.29 217.56 - Deferred tax (credit) / charge (472.69) 452.69 13.25 (69.44) 551.72 526.14 - Fringe benefit tax - - - 171.70 78.00 51.12

Net (loss) / profit after tax before minority interest (56,815.53) (32,993.65) (13,333.95) (7,459.34) 2,068.12 10,485.17 - Less: (Loss) / profit transferred to Minority interest 401.10 (196.70) (530.87) (322.12) 53.80 66.76 Net (loss) / profit after tax before adjustment pursuant to Schemes (57,216.63) (32,796.95) (12,803.08) (7,137.22) 2,014.32 10,418.41

Add: Adjustment pursuant to Modified Composite Scheme of Amalgamation and Arrangement - - - - 84.20 - Less: Adjustment pursuant to Scheme of Amalgamation of Katch 22 - - - - (100.00) -

48

Summary statement of profit and loss of the Group, as restated (` in lakhs)

Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Less: Adjustment pursuant to Scheme of Arrangement for demerger of Radio business/ Scheme of Amalgamation - - - (649.30) - - Net (loss) / profit after tax (Balance carried to Annexure VI) (57,216.63) (32,796.95) (12,803.08) (7,786.52) 1,998.52 10,418.41 The above statement should be read together with significant accounting policies and notes to summary statement of profit and loss, as restated, of the Group (Annexure IV) Period 2012 - Twelve months ended 31 March 2012 Period 2011 - Year ended 31 March 2011 Period 2010 - Year ended 31 March 2010 Period 2009 - Year ended 31 March 2009 Period 2008 - Nine months ended 31 March 2008 Period 2007 - Fifteen months ended 30 June 2007

49

Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

A

Cash flow from operating activities

Net (loss) / profit before tax, as restated (56,828.22) (32,427.06) (13,281.09) (6,942.17) 2,926.13 11,279.99

Adjustment for

Depreciation, amortisation and impairment expense 14,159.10 13,226.50 9,729.44 13,542.41 10,153.62 9,450.22

Bad debts / Advances written off 189.40 201.20 152.10 348.40 391.00 21.43

Sundry balances written-off 180.13 - - - - -

Provisions written back - (241.70) - - -

Provision for doubtful debts and advances 1,500.00 1,666.30 121.90 - 3.20 -

Capital work-in-progress written off 3,613.90 - - - - -

Dividend income (0.40) - - (132.60) (127.40) (203.58)

Interest income (942.20) (868.40) (538.60) (967.10) (967.70) (2,948.49)

Profit on derivative contract - - - - (977.40) (2,671.24)

Loss / (profit) on sale / discarding of fixed assets (net) 297.27 (2,694.80) 70.60 6.80 57.20 7.76

Gain on sale of current investments (32.10) (423.60) (274.40) (1,969.20) (2,692.70) (1,531.64)

Unrealised foreign exchange (gain) / loss (1,648.54) (129.80) (474.39) (1,136.60) 16.70 36.97

Finance costs (including loss on derivative contracts) (net) 28,505.17 17,514.20 11,717.20 12,447.20 2,905.24 618.06

50

Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Operating profit before working capital changes and before net results of Radio Business (11,006.49) (3,935.46) 6,981.06 15,197.14 11,687.89 14,059.48

Adjustment for cash loss pertaining to transaction relating to Radio business till 31 March 2008, pursuant to the Modified Composite Scheme of Amalgamation and Arrangement - - - - (8,377.00) -

(11,006.49) (3,935.46) 6,981.06 15,197.14 3,310.89 14,059.48

Operating profit before working capital changes

Adjustment for :

(Increase) / decrease in trade receivables (962.80) (393.30) (2,513.90) (17,371.80) (7,658.94) (1,651.36)

Decrease / (increase) in loans and advances and other assets 1,951.90 (5,064.24) (1,670.40) 7,719.20 (1,370.40) (31,681.39)

Decrease / (increase) in 222.20 (417.00) (231.50) 80.10 (551.40) 378.62

inventories

Increase / (decrease) in trade and other payable 7,828.27 3,345.12 4,196.26 (2,084.43) 10,404.08 4,044.45

Adjustment for Katch 22 merger due to Scheme of Amalgamation (Refer note 4 of V of E of Annexure IV) - - - - 23.30 -

51

Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Cash (used in) / generated from operating activities (1,966.92) (6,464.88) 6,761.52 3,540.21 4,157.53 (14,850.20)

Taxes paid (net of refunds) 721.40 1,188.26 (1,467.09) (1,974.50) (1,628.70) (1,851.64)

Net cash (used in) / generated from operating activities (A) (1,245.52) (5,276.62) 5,294.43 1,565.71 2,528.83 (16,701.84)

B

Cash flow from investing activities

Purchase of fixed assets (5,476.11) (22,335.80) (40,917.60) (35,911.00) (49,772.50) (30,933.38)

Proceeds from sale of fixed assets / advance against sale of assets 19,453.13 13,999.70 23.10 1,097.50 14.10 48.47

Purchase of investment- long term- in shares of subsidiaries companies/ - (90.80) (3,001.00) (7,861.20) (2,653.60) (1,319.95)

joint venture/ associates

Proceeds from / (Investment in) mutual funds (net) 544.90 8,407.58 (7,707.63) 13,825.89 (13,591.43) 42,129.81

Purchase of investment- long term- other - (9.90) (4.30) (0.30) (5,775.66)

Proceeds on sale of non-current investments / rights therein 1,233.62 23.10 4,066.80 3,127.30 - 1,531.64

(Investment in) / withdrawals’ from Partnership firm 12.90 (15.80) 371.80 278.30 - -

Dividend income 0.40 - - 132.60 127.40 203.58

Interest income 1,080.20 784.50 647.30 1,626.10 288.20 666.15

52

Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Cash (used)/ generated in investing activities 16,849.04 772.48 (46,527.13) (23,688.81) (65,588.13) 6,550.66

Taxed paid (net of refunds) (54.70) (25.80) (35.60) (103.10) (194.40) (119.81)

Net Cash (used)/ generated in investing activities (B) 16,794.34 746.68 (46,562.73) (23,791.91) (65,782.53) 6,430.85

C

Cash flow from financing activities

Proceeds from fresh issue of share capital (including share premium) / 29,500.00 - - - - 2,500.00 preference shares

Payment to Minority (130.80) (228.60) (598.60) (212.90) - -

Dividend tax paid on distribution by Subsidiaries and joint ventures (7.90) (9.10) - (12.80) - -

Introduction of capital by minority partners in a Subsidiary - - 62.99 - - -

Profit/ (loss) on option contract - - - - 977.40 2,671.24 Proceeds from long-term debentures 35,000.00 - - - - -

Proceeds from long-term borrowings 10,000.00 39,775.90 5,489.00 7,826.10 40,000.00 -

Repayment of Foreign currency convertible bonds - (15,814.50) - - - -

(Repayment) / proceeds from short term borrowings (net) (45,443.32) (1,003.80) 52,962.60 31,271.20 28,812.30 10,108.31

53

Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Repayment of long term borrowings (24,121.80) (17,083.30) - - - -

Interest recoverable from Reliance Broadcast Network Limited (576.80) (1,448.60) (2,507.90) (2,584.90) - -

Recovered from Reliance Broadcast Network - 20,000.00 - - - -

Limited pursuant to demerger of Radio business

Dividend (including dividend tax) paid - - - (1,349.20) (1,164.10) (1,116.11)

Finance costs (including loss on derivative contracts) (net) (22,094.09) (18,773.50) (13,414.80) (11,287.10) (4,949.20) (329.92)

Net cash (used in) / generated from financing activities ( C ) (17,874.71) 5,414.50 41,993.29 23,650.40 63,676.40 13,833.52

Net (decrease) / increase in cash and cash equivalent (A+B+C) (2,325.89) 884.56 724.99 1,424.20 422.70 3,562.53

Cash and cash equivalents as at beginning of the period 5,461.75 4,557.09 3,659.50 5,830.40 5,101.00 1,518.73

Cash and cash equivalents taken over on acquisition of subsidiaries - - 292.10 611.90 - -

Exchange gain / loss on translation 89.60 20.10 (119.50) - - -

Cash and cash equivalents disposed on sale of subs/ JV's 362.66 - - - - -

54

Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Adjustment from Composite Scheme of Amalgamation and Arrangement / Modified Composite Scheme of Amalgamation and Arrangement / Scheme of Arrangement / Scheme of Amalgamation - - - (4,207.00) 306.70 19.74

Cash and cash equivalents as at end of the period (refer note (I) and (II) D of Annexure VIII) 2,862.80 5,461.75 4,557.09 3,659.50 5,830.40 5,101.00

(2,325.89) 884.56 724.99 1,424.20 422.70 3,562.53 The above statement should be read together with significant accounting policies and notes to summary statement of cash flows, as restated, of the Group (Annexure IV)

Note: The above cash flow statement has been prepared under the “Indirect” Method as set out in Accounting Standard 3 – ‘Cash Flow Statements’.

Period 2012 - Twelve months ended 31 March 2012 Period 2011 - Year ended 31 March 2011 Period 2010 - Year ended 31 March 2010 Period 2009 - Year ended 31 March 2009 Period 2008 - Nine months ended 31 March 2008 Period 2007 - Fifteen months ended 30 June 2007

55

Summary statement of assets and liabilities of the Company, as restated

(` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Assets A Non-current assets I Fixed assets (i) Tangible assets 79,115.33 85,631.03 84,424.23 66,359.33 34,799.90 13,964.70 (ii) Intangible assets 642.40 418.10 184.60 219.00 18,206.10 4,140.70 (iii) Capital work-in-

progress 12,599.70 13,812.70 16,132.50 16,863.20 21,331.01 14,931.11 (iv) Intangible assets

under development - - - - - - II Non-current investments 18,102.14 7,268.30 5,349.40 2,334.50 10,919.45 8,145.48 III Deferred tax assets (net) - - - - - - IV Long-term loans and

advances 24,161.30 27,325.70 25,648.86 23,869.54 28,957.13 8,783.64 V Other non-current assets 52.07 290.30 277.42 59.41 43.75 5,117.75 134,672.94 134,746.13 132,017.01 109,704.98 114,257.34 55,083.38 B Current assets I Current investments - - 7,902.40 - 13,500.30 19.81 II Inventories 708.20 724.50 596.80 518.30 191.80 161.52 III Trade receivables 17,780.50 18,741.90 22,119.10 20,202.40 11,640.10 6,038.65 IV Cash and bank balances 5,604.40 8,761.80 4,515.17 4,057.93 7,143.29 8,080.79 V Short-term loans and

advances 58,676.90 61,813.60 70,470.49 50,827.20 31,499.68 40,871.52 VI Other current assets 4,753.60 4,265.20 2,765.47 4,281.48 3,911.16 85.75 87,523.60 94,307.00 108,369.43 79,887.31 67,886.33 55,258.04 Liabilities C Non-current liabilities I Long-term borrowings 57,437.50 39,870.80 36,416.70 54,230.00 53,099.90 46,158.40 II Deferred tax liabilities

(net) - - - - - 1,286.18 III Other long-term

liabilities 4,969.50 2,934.69 1,822.66 839.10 342.98 244.96 IV Long-term provisions 516.60 695.90 344.50 3,427.40 3,038.34 10,213.81

62,923.60 43,501.39 38,583.86 58,496.50 56,481.22 57,903.35 D Current liabilities I Short-term borrowings 55,642.70 102,371.40 114,773.20 70,233.50 41,028.60 12,179.68 II Trade payables 15,892.80 10,489.20 7,308.80 5,162.10 8,245.67 2,038.73 III Other current liabilities 83,853.08 55,759.58 38,218.42 4,561.23 7,946.46 4,348.95 IV Short-term provisions 103.20 125.40 31.80 29.30 1,800.65 1,185.32 155,491.78 168,745.58 160,332.22 79,986.13 59,021.38 19,752.68

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Summary statement of assets and liabilities of the Company, as restated (` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 E Net Worth (A+B-C-D) 3,781.16 16,806.16 41,470.36 51,109.66 66,641.07 32,685.39 F Represented by i) Share capital 2,453.80 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04 ii) Reserves and surplus

(net) 1,327.36 14,499.86 39,164.06 48,803.36 64,334.77 30,695.35 G Net Worth (i+ ii) 3,781.16 16,806.16 41,470.36 51,109.66 66,641.07 32,685.39 Note : The above statement should be read with significant accounting policies and notes to summary statement of assets and liabilities of the Company, as restated (Annexure IV)

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Summary statement of profit and loss of the Company, as restated (` in lakhs)

Particulars Period 2012 Period 2011 Period 2010 Period 2009

Period 2008

Period 2007

Revenue from operations 49,654.77 48,669.20 45,551.99 48,234.34 26,894.71 32,008.52 Other income 3,570.40 5,618.20 3,073.20 6,647.90 5,385.30 7,615.44 Total revenue 53,225.17 54,287.40 48,625.19 54,882.24 32,280.01 39,623.96

Direct operational expenses 19,482.80 20,449.70 15,631.90 15,752.90 7,585.30 11,063.53 Employee benefits expense 10,168.90 9,882.50 5,969.20 5,645.80 2,272.80 2,003.91 Finance costs (including loss on derivative contracts) (net) 28,028.57 16,973.30 11,306.60 12,363.70 2,751.34 609.71 Depreciation, amortisation and impairment expense 7,154.00 6,735.10 6,087.40 12,296.61 9,971.04 9,306.98 Other expenses 34,241.70 24,594.80 18,427.09 13,743.54 7,150.27 6,232.54 Total expenses 99,075.97 78,635.40 57,422.19 59,802.55 29,730.75 29,216.67 (Loss) / profit before tax (45,850.80) (24,348.00) (8,797.00) (4,920.31) 2,549.26 10,407.29 Less - Provision for taxes - Current tax - - - - - - - Deferred tax charge / (credit) - - - (134.80) 621.40 496.88 - Fringe benefit tax - - - 151.50 71.49 47.68 Net (loss) / profit after tax before adjustment pursuant to Schemes (45,850.80) (24,348.00) (8,797.00) (4,937.01) 1,856.37 9,862.73 Adjustment pursuant to Composite Scheme of Amalgamation and Arrangement - - - - - 195.19 Net (loss)/ profit after tax (Balance carried to Annexure VI) (45,850.80) (24,348.00) (8,797.00) (4,937.01) 1,856.37 9,667.54 The above statement should be read with significant accounting policies and notes to summary statement of profit and loss of the Company, as restated (Annexure IV)

Period 2012 - Twelve months ended 31 March 2012 Period 2011 - Year ended 31 March 2011 Period 2010 - Year ended 31 March 2010 Period 2009 - Year ended 31 March 2009 Period 2008 - Nine months ended 31 March 2008 Period 2007 - Fifteen months ended 30 June 2007

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Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 A Cash Flow from

operating activities

Net (loss) / profit before tax, as restated (45,850.80) (24,348.00) (8,797.00) (4,920.31) 2,549.26 10,407.29

Adjustment pursuant to Composite Scheme of Amalgamation and Arrangement - - (195.19)

Adjustment for Depreciation and

amortisation expense 7,154.00 6,735.10 6,087.40 12,296.61 9,971.04 9,306.98

Bad debts / advances written-off 48.20 107.30 50.50 263.00 385.10 -

Provision for doubtful debts and advances 1,625.00 1,658.20 121.90 - -

Provision for diminution in value of non-current investments 700.06 - - - - -

Sundry balances written-off 180.20 - - - - -

Capital work-in-progress written-off 3,613.90

Dividend income - - (85.30) (205.40) (148.80) (269.39) Interest income (825.20) (773.20) (406.40) (716.70) (831.50) (2,914.48) Profit on

derivative contract - - - - (977.40) (2,671.24)

Loss / (profit) on sale / discarding of fixed assets (net) 292.44 (2,701.10) 40.80 4.40 56.50 5.25

Gain on sale of non-current investments (766.50) - - - - -

Gain on sale of current investments (32.10) (423.60) (274.40) (1,969.20) (2,669.40) (1,531.64)

Provisions written back - - (241.70) - - -

Unrealised foreign exchange (gain) / loss (2,316.90) (305.30) 2,000.20 (807.20) (18.10) 36.97

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Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Finance costs

(including loss on derivative contracts) (net)

28,028.57

16,973.30

11,306.60

12,363.70

2,751.34

609.71

Operating (loss) / profit before working (8,149.13) (3,077.30) 9,802.60 16,308.90 11,068.04 12,784.26

capital changes and before net results of Radio business

Adjustment for cash loss pertaining to transaction relating to Radio business up to 31 March 2008 pursuant to Modified Composite Scheme of Amalgamation and Arrangement - - - - (8,377.00) -

Operating (loss) / profit before working capital changes (8,149.13) (3,077.30) 9,802.60 16,308.90 2,691.04 12,784.26

Adjustment for :

(Increase) / decrease in trade receivables (560.60) 2,749.20 (2,008.60) (17,317.60) (7,582.14) (2,414.08)

Decrease / (increase) in loans and advances and other assets 3,678.10 (5,484.91) (1,978.10) (6,541.45) (5,773.14) (45,891.07)

Decrease / (increase) in inventories 16.30 (127.70) (78.50) (325.40) (30.30) (31.17)

Increase / (decrease) in trade and other payables 5,872.83 4,988.71 4,863.50 (4,444.30) 9,061.70 (743.07)

Cash generated from / (used in) from operating activities 857.50 (952.00) 10,600.90 (12,319.85) (1,632.84) (36,295.13)

Taxes paid (net of refunds) 1,219.00 1,693.00 (1,122.00) (1,544.50) (1,346.80) (1,607.05)

Net cash generated from / (used in) operating activities (A) 2,076.50 741.00 9,478.90 (13,864.35) (2,979.64) (37,902.18)

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Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

B Cash flow from

investing activities

Purchase of fixed assets (3,291.60) (15,372.10) (24,733.56) (21,363.60) (46,194.40) (11,673.89)

Proceeds from sale of fixed assets / advance 19,421.40 13,986.70 10.80 1,087.60 12.10 48.38

against sale of assets

Proceeds on sale of non-current investments 1,233.60 1.00 4,066.80 3,127.30 - -

Loan to subsidiaries and joint ventures (net) (5,038.50) (13,597.70) (21,195.70) 0.00 - -

Purchase of non-current investment - in shares of subsidiaries companies / joint venture/ associates (1.00) (2,000.00) (3,005.00) (201.80) (2,720.80) (6,507.35)

Advance for application money towards subscription of shares in a joint venture - - (125.00) - - -

Repayment of capital by Partnership firm - - 241.70 - - -

Purchase of non-current investments – other - - (9.90) (4.50) (0.40) -

Proceeds from / (Investment in) current investment funds (net) 32.10 8,326.00 (7,628.00) 13,769.50 (13,471.39) 44,105.31

Dividend income - - 85.30 205.40 148.80 269.39 Interest income 980.10 685.90 425.60 1,395.40 238.40 814.14 Cash generated

from / (used in) investing activities 13,336.10 (7,970.20) (51,866.96) (1,984.70) (61,987.69) 27,055.98

Taxed paid (net of refunds) (43.40) (17.00) (26.70) (78.10) (194.40) (118.83)

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Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Net Cash

generated from / (used in) investing activities (B) 13,292.70 (7,987.20) (51,893.66) (2,062.80) (62,182.09) 26,937.15

C Cash flow from

financing activities

Proceeds from long-term borrowings 10,000.00 37,500.00 3,500.00 - 40,000.00

-

Proceeds from issue of long-term debentures 35,000.00 - - - -

Proceeds from short-term borrowings (net) (46,728.60) 2,598.10 54,539.70 31,250.80 28,845.30 11,193.00

Proceeds from

issue of Preference Shares 29,500.00 - - - - -

Repayment of Foreign currency convertible bonds - (15,814.50)

Repayment of long-term borrowings (23,212.50) (17,083.30) - - - -

Profit on derivative contract - - - 977.40 2,671.24

Interest recoverable from Reliance Broadcast Network Limited (576.80) (1,448.60) (2,507.89) (2,584.90)

Recovered from Reliance Broadcast Network Limited pursuant to Scheme of Arrangement 20,000.00 - -

Dividend (including dividend distribution tax) paid - (1,349.20) (1,164.10) (1,020.23)

Finance costs (including loss on derivative contracts) (net) (21,586.70) (16,757.90) (13,034.60) (11,201.60) (4,795.30) (321.57)

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Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Net cash flow

(used in) / generated from financing activities ( C ) (17,604.60) 8,993.80 42,497.21 16,115.10 63,863.30 12,522.44

Net increase in cash and cash equivalent (A+B+C) (2,235.40) 1,747.60 82.45 187.95 (1,298.43) 1,557.41

Cash and cash

equivalents as at beginning of the period 3,201.10 1,453.50 1,371.05 1,989.10 1,987.53 347.70

Cash and cash equivalents as at end of the period (refer note (I) (II) D of Annexure VIII) 965.70 3,201.10 1,453.50 1,371.05 1,989.10 1,987.53

(2,235.40) 1,747.60 82.45 187.95 (1,298.43) 1,557.41 Note :

1. The above cash flow statement has been prepared under the "Indirect Method" as set out in Accounting Standard 3 - Cash Flow Statement

2. During the year, the Company has converted its loans to a subsidiary into preference shares amounting to ` 12,000 lakhs

The above statement should be read with significant accounting policies and notes to summary statement of cash flow of the Company, as restated (Annexure IV)

Period 2012 - Twelve months ended 31 March 2012 Period 2011 - Year ended 31 March 2011 Period 2010 - Year ended 31 March 2010 Period 2009 - Year ended 31 March 2009 Period 2008 - Nine months ended 31 March 2008 Period 2007 - Fifteen months ended 30 June 2007

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THE ISSUE

The following is a summary of the Issue. This summary should be read in conjunction with, and is qualified in its entirety by, more detailed information in the chapter entitled “Terms of the Issue” at page 566. Equity Shares to be issued [●] Equity Shares Rights Entitlement [●] Equity Share(s) for every [●] fully paid-up Equity Share(s) held

on the Record Date. Record Date [●] Face Value per Equity Share ` 5 Issue Price per Equity Share `[●] Equity Shares outstanding prior to the Issue 4,61,26,170 Equity Shares(1) Equity Shares outstanding after the Issue (assuming full subscription for and Allotment of the Rights Entitlement)

[●] Equity Shares

Terms of the Issue For more information, please see the section entitled “Terms of the Issue” at page 566.

Use of Issue Proceeds For further information, please see the section entitled “Objects of the Issue” at page 566.

(1) The Equity Shareholders of our Company have, at the Annual General meeting held on September 29, 2011, approved a qualified institutional placement (QIP) of Equity Shares or instruments that are convertible into or exchangeable into Equity Shares, in one or more tranches, upto an aggregate amount not exceeding ` 50,000 lakhs. Accordingly, our Company may undertake the QIP in accordance with the ICDR Regulations.

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GENERAL INFORMATION Pursuant to the resolution passed by our Board of Directors at its meeting held on July 25, 2012 it has been decided to make the following offer to the Equity Shareholders, with a right to renounce: ISSUE OF [●] EQUITY SHARES FOR CASH AT A PREMIUM OF `[●] PER EQUITY SHARE FOR AN AMOUNT NOT EXCEEDING ` 60,000 LAKHS ON A RIGHTS BASIS TO THE EXISTING EQUITY SHAREHOLDERS OF OUR COMPANY IN THE RATIO OF [●] EQUITY SHARES FOR EVERY [●] FULLY PAID-UP EQUITY SHARES HELD ON THE RECORD DATE, THAT IS ON [●]. THE ISSUE PRICE IS [●] TIMES THE FACE VALUE OF THE EQUITY SHARES. Issue Programme The subscription will open upon the commencement of the banking hours and will close upon the close of banking hours on the dates mentioned below:

ISSUE OPENS ON LAST DATE TO REQUEST FOR SPLIT APPLICATION FORMS

ISSUE CLOSES ON

[●] [●] [●] Registered Office of our Company Reliance MediaWorks Limited Film City Complex Goregaon (East) Mumbai 400 065 Maharashtra Telephone: +91 22 3980 8900 Facsimile: +91 22 3980 8985 Website: www.reliancemediaworks.com CIN: L29299MH1987PLC045446 Address of the RoC Our Company is registered with the RoC, which is situated at the following address: Registrar of Companies Everest, 5th Floor, 100, Marine Drive Mumbai 400 002 Maharashtra Board of Directors of our Company Our Board of Directors consists of:

Name and Designation DIN Address Gautam Doshi Non-Executive Non-Independent Director

00004612 402, Hamilton Court, Tagore Road, Santa Cruz (West), Mumbai 400 054

Amit Khanna Non-Executive Non-Independent Director

00005430 301, Sea Star, 3rd Floor, Balraj Sahani Marg Juhu, Mumbai 400 049

Sujal Shah Non-Executive Independent Director

00058019 9, Ganesh Bhuvan, Natwar Nagar, Road no.2, Jogeshwari (East), Mumbai 400 060

Anil Sekhri 00506790 23-A, Krishna Kunj, Opp. Millat Nagar, Off.

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Name and Designation DIN Address Non-Executive Independent Director New Link Road, Andheri (West), Mumbai 400

053 Prasoon Joshi Non-Executive Independent Director

01260545 201-202, B Wing, Quantum Park Building Union Park, Khar (West), Mumbai 400 052

For further details of our Directors, please see the chapter entitled “Our Management” at page 154. Company Secretary and Compliance Officer

Ashish Agarwal is the Company Secretary and Compliance Officer of our Company. His details are as follows: Ashish Agarwal Reliance MediaWorks Limited Film City Complex Goregaon (East) Mumbai 400 065 Maharashtra India Tel: +91 22 3980 8900 Facsimile: +91 22 3980 8985 Email: investor.complaints@relianceada.com Investors may contact the Registrar to the Issue or our Company Secretary and Compliance Officer for any pre-Issue / post-Issue related matter. All grievances relating to the ASBA process may be addressed to the Registrar to the Issue, with a copy to the SCSB, giving full details such as name, address of the applicant, number of Equity Shares applied for, amount blocked, ASBA Account number and the designated branch of the SCSB where the CAF was submitted by the ASBA Investors. Lead Manager Yes Bank Limited Indiabulls Finance Centre Tower II, 27th Floor Senapati Bapat Marg Elphinstone (West) Mumbai 400 013 Telephone: +91 22 3347 9612 Facsimile: +91 22 2421 4508 Email: dlrmwlrights@yesbank.in Website: www.yesbank.in Investor Grievance Id: merchantbanking@yesbank.in Contact Person: Gautam Badalia SEBI Registration No. INM 0000 10874 Legal Advisors to the Issue Bharucha & Partners 2nd Floor, Hague Building, 9, S. S. Ram Gulam Marg, Ballard Estate, Mumbai 400 001 Telephone: +91 22 6132 3900 Facsimile: +91 22 6633 3900 Email: rirmwl@bharucha.in

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Auditors to our Company B S R & Co., Chartered Accountants KPMG Lodha Excelus 1st Floor, Apollo Mills Compound N.M. Joshi Marg Mahalakshmi Mumbai 400 011 Telephone: +91 22 3989 6000 Facsimile: +91 22 3983 5010 Email: bdhupelia@kpmg.com

Chaturvedi & Shah, Chartered Accountants 714-715 Tulsiani Chambers 212, Nariman Point Mumbai 400 021 Telephone: +91 22 30218500 Facsimile: +91 22 302185 95 Email: cas@cas.ind.in

Registrar to the Issue Link Intime India Private Limited C 13, Pannalal Silk Mills Compound LBS Marg, Bhandup (West) Mumbai 400 078 Telephone: +91 22 2596 7878 Toll-free: 1-800-22-0878 Facsimile: +91 22 2596 0329 E-mail: rml.rights@linkintime.co.in Investor Grievance Email: rml.rights@linkintime.co.in Website: www.linkintime.co.in Contact Person: Pravin Kasare SEBI Registration No.: INR000004058 Bankers to the Issue [●] Bankers to our Company Bank of Baroda Chakala Branch Apple Heritage, Andheri (East), Mumbai 400 093 Telephone: +91 22 26877314 / 26879832 Facsimile No. : +91 22 2687 8307 Email : chakal@bankofbaroda.com

Export Import Bank of India Centre One Building, Floor no 21, World Trade Centre Complex, Cuffe Parade, Mumbai 400 005 Telephone: +91 22 2217 2409 Fax No. : +91 22 2218 8076 Email : shailesh@eximbankindia.in

Jammu & Kashmir Bank Limited B.O. E – 9, South Ext. Part II, New Delhi 110 049 Telephone : +91 11 2625 8850 Facsimile: +91 11 2625 4009 Email : sexten@jkbmail.com

Syndicate Bank Nariman Point Branch 227, Nariman Bhavan, Ground Floor, Nariman Point, Mumbai 400 021 Telephone : +91 22 22029881 / 2284 2865 Facsimile: +91 22 2202 4812 Email : mh.5037mumnp@syndicatebank.co.in

Allahabad Bank Goregaon Branch Kiran Industrial Estate, M. G. Road, Goregaon (W),

Union Bank of India Industrial Finance Branch Union Bank Bhavan, 239, Vidhan Bhavan Marg, Nariman Point,

67

Mumbai 400 062 Telephone: 022 2872 2139 Facsimile: 022 2873 7386 Email : br.mumgoregaon@allahabadbank.in

Mumbai 400 021 Telephone: +91 22 2289 2021 Facsimile: +91 22 2285 5037 / 2204 0023 Email : promodini@unionbankofindia.com

Vijaya Bank Industrial Finance Branch New Excelsior Building, 2nd Floor, Fort, Mumbai 400 001 Telephone: +91 22 2206 4756 Facsimile: +91 22 2207 5994 Email : mum.ifb5045@vijayabank.co.in

HDFC Bank Limited Corporate Banking 2nd Floor, Process House, Kamala Mills Compound, S. B. Marg, Lower Parel, Mumbai 400 013 Telephone: +91 22 2490 1810 Facsimile: +91 22 2496 3994 Email : anand.mankodi@hdfcbank.com

Axis Bank Limited Axis House, 7th Floor, Bombay Dyeing Mill Compound, P. B. Marg, Worli, Mumbai 400 029 Telephone: +91 22 2425 3734 Facsimile: +91 22 2424 1700 Email : kankan.chatterjee@axisbank.com

Yes Bank Limited Indiabulls Finance Centre, Tower II, 25th Floor, S.B. Marg, Elphinstone (West), Mumbai 400 013 Telephone: +91 22 3347 9158 Email : saurav.mahajan@yesbank.in

Self Certified Syndicate Banks The list of banks that have been notified by SEBI to act as SCSB for the ASBA process is provided on http://www.sebi.gov.in/pmd/scsb.html. Expert Opinion Except for the report on the statement of tax benefits dated July 25, 2012 received from Jitendra Sanghavi & Co., Chartered Accountants, in the form and context in which it appears in this Draft Letter of Offer, we have not obtained any other expert opinion in relation to this issue. Monitoring Agency Since the Issue size is in excess of `50,000 lakhs, in accordance with Regulation 16 of the ICDR Regulations, our Company is required to appoint a Monitoring Agency. Our Company will appoint a Monitoring Agency prior to filing of the Letter of Offer. Statement of responsibility of the Lead Manager Yes Bank Limited is the sole Lead Manager to the Issue and all the responsibilities relating to coordination and other activities in relation to the Issue shall be performed by it. The various activities have been set forth below:

Sr. No. Activities 1. Structuring of the Issue in conformity with the ICDR Regulations, undertaking liaison with the Stock

Exchanges, as may be required under the prevailing framework of regulations/rules/guidelines issued by the SEBI and the Stock Exchanges.

2. Assisting our Company and its legal advisors in drafting the Letter of Offer, the Abridged Letter of Offer and the CAF; conduct due diligence as may be required on our Company and assist in compliance with regulatory requirements of the SEBI and the Stock Exchanges. The Lead Manager shall ensure compliance with the ICDR Regulations and other stipulated requirements and completion of prescribed formalities with the Stock Exchanges and the SEBI.

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Sr. No. Activities 3. Institutional marketing strategies and assisting our Company in preparing the Issue advertisements. 4. Follow-up with the Bankers to the Issue to get quick estimates of collection and advising such Banks about

closure of the Issue, based on the correct figures. 5. Assisting in the listing of the Equity Shares issued pursuant to the Issue on the Stock Exchanges.

6. Assist in the selection of various agencies connected with the Issue, including printers, advertising agencies, legal advisors, bankers to the Issue (selecting collection centers) and Registrar to the Issue.

7. The post issue activities will involve essential follow up steps which must include finalization of basis of allotment/weeding out of multiple applications, listing of instruments and dispatch of certificates and refunds, with the various agencies connected with the activities such as Registrars to the Issue, Bankers to the Issue. Whilst, many of the post issue activities will be handled by other intermediaries, the Lead Manager shall be responsible for ensuring that these agencies fulfill their functions and enable them to discharge this responsibility through suitable agreements with the Issuer Company.

Credit Rating As the Issue is of Equity Shares, credit rating is not required for this Issue. Trustees As the Issue is of Equity Shares, the appointment of trustees is not required. Appraisal Reports None of the purposes for which the Net Proceeds are proposed to be utilised have been appraised by any bank or financial institution. Book Building Process As the Issue is a rights issue, the Issue will not be made through the book building process. Underwriting The Issue is not underwritten.

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CAPITAL STRUCTURE

The share capital of our Company as on the date of this Draft Letter of Offer is set forth below:

(In `, except share data)

Aggregate value at face value

Aggregate value at Issue Price

A AUTHORISED SHARE CAPITAL 48,00,00,000 Equity Shares of `5/- each 240,00,00,000 2,00,00,000 Preference Shares of `5/- each. 10,00,00,000 Total 250,00,00,000

B ISSUED, SUBSCRIBED AND PAID-UP CAPITAL BEFORE THE ISSUE

4,61,26,170 fully paid up Equity Shares of `5/- each 23,06,30,850

10%, 29,50,000 Redeemable Non Convertible Preference Shares of `5/- each 1,47,50,000

Total 24,53,80,850

C PRESENT ISSUE BEING OFFERED TO THE EXISTING EQUITY SHAREHOLDERS THROUGH THIS DRAFT LETTER OF OFFER

[●] Equity Shares at an Issue Price of ` [●] per Equity Share 600,00,00,000 [●]

D ISSUED, SUBSCRIBED AND PAID UP CAPITAL AFTER THE ISSUE

[●] Equity Shares of `5/- each fully paid-up [●]

10%, 29,50,000 Redeemable Non Convertible Preference Shares of `5/- each 1,47,50,000

E SECURITIES PREMIUM ACCOUNT

Before the Issue 761,69,98,808

After the Issue [●] The Issue of Equity Shares has been authorised by our Board of Directors pursuant to its resolution dated July 25, 2012. Changes in the Authorised Capital of our Company 1. The initial authorised share capital of `25,00,000 divided into 25,000 equity shares of `100/- each was sub-

divided into 2,50,000 equity shares of `10/- each pursuant to a resolution of our shareholders passed on November 1, 1999.

2. The authorised share capital of `25,00,000 divided into 2,50,000 equity shares of `10/- each was increased to `12,00,00,000 divided into 1,20,00,000 equity shares of `10/- each pursuant to a resolution of the shareholders passed on November 1, 1999.

3. The authorised share capital of `12,00,00,000 divided into 1,20,00,000 equity shares of `10/- each was sub-divided into 2,40,00,000 Equity Shares of `5/- each pursuant to a resolution of the shareholders passed on August 1, 2000.

4. The authorised share capital of `12,00,00,000 divided into 2,40,00,000 Equity Shares of `5/- each was

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increased to `15,00,00,000 divided into 3,00,00,000 Equity Shares of `5/- each pursuant to a resolution of the shareholders passed on May 14, 2005.

5. The authorised share capital of `15,00,00,000 divided into 3,00,00,000 Equity Shares of `5/- each was increased to `25,00,00,000 divided into 5,00,00,000 Equity Shares of `5/- each pursuant to a resolution of the shareholders passed on July 26, 2005.

6. The authorised share capital of `25,00,00,000 divided into 5,00,00,000 Equity Shares of `5/- each was increased to `30,00,00,000 divided into 6,00,00,000 Equity Shares of `5/- each pursuant to a resolution of the shareholders passed on January 12, 2006.

7. The authorised share capital of `30,00,00,000 divided into 6,00,00,000 Equity Shares of `5/- each was increased to `46,02,90,000 divided into 9,20,58,000 Equity Shares of `5/- each on May 29, 2009 pursuant to the scheme of amalgamation amongst Adlabs Multiplexes and Theatres Limited, Adlabs Multiplex Limited, Mahimna Entertainment Private Limited, Rave Entertainment Private Limited and our Company. For further details, please see the chapter entitled “History and Certain Corporate Matters – Scheme of Arrangements” at page 132.

8. The authorised share capital of `46,02,90,000 divided into 9,20,58,000 Equity Shares of `5/- each was

increased to `50,00,00,000 divided into 10,00,00,000 Equity Shares of `5/- each pursuant to a resolution of the shareholders passed on September 30, 2009.

9. The authorised share capital was reclassified from `50,00,00,000 divided into 10,00,00,000 Equity Shares of `5/- each, to `50,00,00,000 divided into 8,00,00,000 Equity Shares of `5/- each and 2,00,00,000 (Two Crore) Preference Shares of `5/- each pursuant to a resolution of the shareholders passed on March 30, 2012.

10. The authorised share capital of 8,00,00,000 Equity Shares of `5/- each and 2,00,00,000 Preference Shares

of `5/- each was increased to `250,00,00,000 divided into 48,00,00,000 Equity Shares of `5/- each and 2,00,00,000 preference shares of ` 5/- each pursuant to a resolution of the shareholders passed on July 13, 2012.

Notes to the Capital Structure 1. Share Capital History of our Company

a. The history of the equity share capital and securities premium account of our Company is detailed in the

following table:

Date of allotment

No. of equity shares

allotted

Face Value

per equity share

(`)

Issue Price per

equity share (`)

Nature of consideration

Cumulative number of

equity shares

Cumulative equity share capital (`)

Cumulative equity securities premium

(`)(5)

At incorporation

200 100/- 100/- Cash 200 20,000 -

February 8, 1990

4,800 100/- 100/- Cash 5,000 5,00,000 -

November 1, 1999

85,00,000 10/-(1) - Bonus in the ratio of 170:1 fully paid up equity shares out of the general

85,50,000 8,55,00,000 -

71

Date of allotment

No. of equity shares

allotted

Face Value

per equity share

(`)

Issue Price per

equity share (`)

Nature of consideration

Cumulative number of

equity shares

Cumulative equity share capital (`)

Cumulative equity securities premium

(`)(5)

reserve December 2, 1999

300 10/- 10/- Cash 85,50,300 8,55,03,000 -

December 29, 2000

44,00,150 5/-(2) 120/- Cash(3) 2,15,00,750 10,75,03,750 50,60,17,250

May 24, 2005 35,00,000 5/- 150/- Cash 2,50,00,750 12,50,03,750 1,01,35,17,250 August 8, 2005 1,10,00,000 5/- 175.20/- Cash 3,60,00,750 18,00,03,750 2,88,57,17,250 March 31, 2006 38,00,000 5/- 175.20/- Cash 3,98,00,750 19,90,03,750 3,53,24,77,250 November 13, 2007

4,92,754 5/- 543.42/- Cash(4) 4,02,93,504 20,14,67,520 3,79,77,85,858.68

November 22, 2007

7,48,866 5/- 543.42/- Cash(4) 4,10,42,370 20,52,11,850 4,20,09,90,290.40

November 30, 2007

3,99,396 5/- 543.42/- Cash(4) 4,14,41,766 20,72,08,830 4,41,60,33,084.72

December 11, 2007

9,48,565 5/- 543.42/- Cash(4) 4,23,90,331 21,19,51,655 4,92,67,59,452.02

December 19, 2007

7,03,933 5/- 543.42/- Cash(4) 4,30,94,264 21,54,71,320 5,30,57,71,057.88

January 2, 2008 16,22,544 5/- 543.42/- Cash(4) 4,47,16,808 22,35,84,040 6,17,93,81,198.36 January 22, 2008

11,64,734 5/- 543.42/- Cash(4) 4,58,81,542 22,94,07,710 6,80,64,97,278.64

February 5, 2008

1,19,818 5/- 543.42/- Cash(4) 4,60,01,360 23,00,06,800 6,87,10,09,686.20

February 25, 2008

74,886 5/- 543.42/- Cash(4) 4,60,76,246 23,03,81,230 6,91,13,29,806.32

March 17, 2008 49,924 5/- 543.42/- Cash(4) 4,61,26,170 23,06,30,850 6,93,82,09,886.40 (1) On November 1, 1999, face value of the equity shares was sub-divided from `100/- each to `10/- each. (2) On August 1, 2000, face value of the equity shares was sub-divided from `10/- each to `5/- each. (3) Issuance of 44,00,150 Equity Shares pursuant to an initial public offer undertaken by our Company for an

aggregate amount of `5,280.0 lakhs. (4) Equity Shares allotted by our Company pursuant to conversion of foreign currency convertible bonds. (5) Adjustments to the securities premium account: The amount standing to the credit of the securities premium

account was adjusted towards FCCB redemption premium and related issue expenses during the Fiscals 2006 to 2011. Further, it was adjusted pursuant to the various schemes of arrangements undertaken by our Company, as approved by the respective High Courts, during Fiscal 2008 and Fiscal 2009. For details, please see chapter entitled “Financial Statements”at page 188.

b. The details of the equity shares allotted for consideration other than cash are provided in the following

table:

Date of allotment

Name of the allottee(s)

No. of equity shares

allotted

Face value per equity share (`)

Issue Price per equity share (`)

Reasons for the allotment

November 1, 1999

Existing equity shareholders of our Company

85,00,000 10/- - Bonus in the ratio of 170:1 fully paid up equity shares out of the general reserve

c. The details of the preference shares allotted are provided in the following table:

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Date of allotment

Name of the allottee(s)

No. of preference

shares allotted

Face value per preference share (`̀)

Issue Price per

equity share (`̀)

Reasons for the allotment

March 31, 2012

Reliance Utility Engineers Private Limited

17,50,000 5/- 1,000/- For the purpose of networth rebuilding and strengthening the long term resource base of our Company including meeting working capital requirements

March 31, 2012

Reliance Infocomm Engineering Private Limited

12,00,000 5/- 1,000/-

2. History of the equity share capital held by our Promoters a. Details of the build-up of our Promoters’ shareholding in our Company:

Date of allotment/ Transfer

Nature of transaction

No. of Equity Shares

Nature of consideration

Face value per

Equity Share (`)

Issue/Average Acquisition Price per

Equity Share (`)

Percentage of the pre-

Issue capital

(%)

Percentage of the post-

Issue capital (%)

Reliance Land Private Limited June 30, 2005

Acquisition of Equity Shares(1) 58,00,000 Cash 5/- 169.00/- 12.57 [●]

August 8, 2005

Preferential Allotment 1,10,00,000 Cash 5/- 175.20/- 23.85 [●]

March 31, 2006

Conversion of warrants 38,00,000 Cash 5/- 175.20/- 8.24 [●]

Total 2,06,00,000 44.66 [●]

Reliance Capital Limited October 1, 2005

Purchase from secondary market 12,55,000 Cash 5/- 99.19/- 2.72 [●]

January 6, 2009

Purchase from secondary market 2,00,000 Cash 5/- 214.88/- 0.43 [●]

January 6, 2009

Purchase from secondary market 2,00,000 Cash 5/- 214.73/- 0.43 [●]

January 7, 2009

Purchase from secondary market 12,500 Cash 5/- 230.00/- 0.03 [●]

January 7, 2009

Purchase from secondary market 12,500 Cash 5/- 228.01/- 0.03 [●]

January 9, 2009

Purchase from secondary market 87,500 Cash 5/- 179.17/- 0.19 [●]

January 9, 2009

Purchase from secondary market 87,500 Cash 5/- 178.75/- 0.19 [●]

January 12, 2009

Purchase from secondary market 23,000 Cash 5/- 179.87/- 0.05 [●]

January 12, 2009

Purchase from secondary market 77,000 Cash 5/- 180.03/- 0.17 [●]

January 14, 2009

Purchase from secondary market 45,000 Cash 5/- 178.75/- 0.10 [●]

January 14, 2009

Purchase from secondary market 55,000 Cash 5/- 178.87/- 0.12 [●]

February 3, 2009

Purchase from secondary market 81,000 Cash 5/- 164.59/- 0.18 [●]

February 3, 2009

Purchase from secondary market 1,19,000 Cash 5/- 165.17/- 0.26 [●]

73

Date of allotment/ Transfer

Nature of transaction

No. of Equity Shares

Nature of consideration

Face value per

Equity Share (`)

Issue/Average Acquisition Price per

Equity Share (`)

Percentage of the pre-

Issue capital

(%)

Percentage of the post-

Issue capital (%)

February 10, 2009

Purchase from secondary market 50,000 Cash 5/- 170.44/- 0.11 [●]

February 10, 2009

Purchase from secondary market 50,000 Cash 5/- 170.14/- 0.11 [●]

February 13, 2009

Purchase from secondary market 86,000 Cash 5/- 178.60/- 0.19 [●]

February 13, 2009

Purchase from secondary market 1,14,000 Cash 5/- 178.36/- 0.25 [●]

February 18, 2009

Purchase from secondary market 50,000 Cash 5/- 163.68/- 0.11 [●]

February 18, 2009

Purchase from secondary market 50,000 Cash 5/- 163.33/- 0.11 [●]

February 25, 2009

Purchase from secondary market 42,000 Cash 5/- 164.00/- 0.09 [●]

February 25, 2009

Purchase from secondary market 58,000 Cash 5/- 163.97/- 0.13 [●]

February 26, 2009

Purchase from secondary market 20,000 Cash 5/- 162.59/- 0.04 [●]

February 26, 2009

Purchase from secondary market 80,000 Cash 5/- 162.80/- 0.17 [●]

February 27, 2009

Purchase from secondary market 40,000 Cash 5/- 165.63/- 0.09 [●]

February 27, 2009

Purchase from secondary market 60,000 Cash 5/- 165.45/- 0.13 [●]

October 14, 2009

Acquisition of shares(2) 24,00,000 Cash 5/- 355.62/- 5.20 [●]

October 14, 2009

Acquisition of shares(2) 24,00,000 Cash 5/- 355.62/- 5.20 [●]

November 3, 2009

Purchase from secondary market 15,000 Cash 5/- 251.03/- 0.03 [●]

November 3, 2009

Purchase from secondary market 35,000 Cash 5/- 246.20/- 0.08 [●]

November 4, 2009

Purchase from secondary market 15,000 Cash 5/- 251.73/- 0.03 [●]

November 4, 2009

Purchase from secondary market 85,000 Cash 5/- 253.06/- 0.18 [●]

November 5, 2009

Purchase from secondary market 30,000 Cash 5/- 272.23/- 0.07 [●]

November 5, 2009

Purchase from secondary market 70,000 Cash 5/- 273.40/- 0.15 [●]

November 13, 2009

Purchase from secondary market 24,000 Cash 5/- 284.95/- 0.05 [●]

November 13, 2009

Purchase from secondary market 26,000 Cash 5/- 284.83/- 0.06 [●]

November 20, 2009

Purchase from secondary market 15,000 Cash 5/- 282.86/- 0.03 [●]

November 20, 2009

Purchase from secondary market 35,000 Cash 5/- 282.14/- 0.08 [●]

November 16, 2011

Purchase from secondary market 1,00,352 Cash 5/- 83.24/- 0.21 [●]

November 17, 2011

Purchase from Secondary Market

62,588 Cash 5/- 82.95/- 0.13 [●]

74

Date of allotment/ Transfer

Nature of transaction

No. of Equity Shares

Nature of consideration

Face value per

Equity Share (`)

Issue/Average Acquisition Price per

Equity Share (`)

Percentage of the pre-

Issue capital

(%)

Percentage of the post-

Issue capital (%)

November 18, 2011

Purchase from Secondary Market

81,070 Cash 5/- 81.88/- 0.17 [●]

November 22, 2011

Purchase from Secondary Market

48,743 Cash 5/- 82.90/- 0.10 [●]

November 24, 2011

Purchase from Secondary Market

1,00,000 Cash 5/- 83.50/- 0.21 [●]

November 29, 2011

Purchase from Secondary Market

31,613 Cash 5/- 84.61/- 0.06 [●]

Total 85,29,366 18.49 [●] (1) On June 30, 2005, Reliance Land Private Limited entered into two separate share purchase agreements with Vasanji Asaria Mamania and Rubaiyat Arun Patel, being erstwhile shareholders of our Company, for acquiring 44,00,000 Equity Shares and 14,00,000 Equity Shares, respectively, i.e. aggregating to 58,00,000 Equity Shares. (2) On October 14, 2009, there was an intergroup transfer from AAA Entertainment Private Limited to Reliance Capital Limited.

b. The Issue is exempted from the requirements of minimum promoters’ contribution in accordance with

Regulation 34(c) of the ICDR Regulations.

c. Our Promoters have, through the letter dated July 26, 2012 (“Subscription Letter”), jointly and severally, undertaken to (i) apply for Equity Shares being offered to them pursuant to the Issue to the extent of their Rights Entitlement; (ii) apply directly or through our Company’s Promoter Group for any Equity Shares renounced in their favour; and (iii) apply directly or through the Company’s Promoter Group for any additional Equity Shares in the Rights Issue only to the extent of any unsubscribed portion of the Rights Issue, subject to applicable law, to ensure that at least 90% of the Rights Issue is subscribed. As a result of the subscription to any unsubscribed portion and consequent allotment of Equity Shares in accordance with the paragraph above, the Promoters may acquire Equity Shares over and above their Rights Entitlement which may result in an increase in their shareholding, individually and / or collectively, above their current shareholding. Any such subscription and acquisition of Equity Shares by the Promoters in the Rights Issue will not result in change of control of the management of the Company in accordance with Regulation 3 (2) of the Takeover Regulations and shall be exempt in terms of Regulation 10 (4) (b) of the Takeover Code. Further, such subscription to additional Equity Shares by the Promoters beyond their Rights Entitlement will be in accordance with the provisions of Regulation 10(4) (b) of the Takeover Regulations. As such, other than meeting the requirements indicated in the chapter entitled “Objects of the Issue” at page 82, there is no other intention / purpose for the Issue, including any intention to delist our Equity Shares, even if, as a result of any Allotment in the Issue to our Promoter(s) and / or the members of our Promoter Group, the shareholding of our Promoters and/or Promoter Group in our Company exceeds their current shareholding. However, such participation will not result in breach of minimum public shareholding requirement stipulated in the equity Listing Agreement entered into between us and the Stock Exchanges.

d. Our Company had availed of unsecured loans aggregating `89,641.00 lakhs (“RCL Loan”) from Reliance Capital Limited, which is one of our Promoters. As at June 30, 2012, the total amount outstanding for the RCL Loan was `86,958.42 lakhs. For further details, please see the chapter entitled “Financial Indebtedness” at page 475. Reliance Capital Limited through its letter dated July 26, 2012 has consented to adjust the RCL Loan towards share application money against their Rights Entitlements and additional subscription, if any. Consequently no fresh Issue proceeds would be received by our Company to such an

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extent. For further details, please see the chapter entitled “Objects of the Issue” at page 82.

3. Shareholding Pattern of our Company a. The table below presents the shareholding pattern of Equity Shares as on July 20, 2012 is as follows:

76

Category code

Category of Shareholder

Number of Shareholders

Total number of shares

Number of shares held in dematerialized form

Total shareholding as a percentage of total number of

shares

Shares Pledged or otherwise encumbered

As a percentage of (A+B)1

As a percentage of

(A+B+C)

Number of shares

As a percentage

(I) (II) (III) (IV) (V) (VI) (VII) (VIII) (IX)=(VIII) / (IV)*100

(A) Shareholding of Promoter and Promoter Group2

NA NA 1 Indian

(a) Individuals/ Hindu Undivided Family

(b) Central Government/ State Government(s)

(c) Bodies Corporate 2 2,91,29,366 2,91,29,366 63.15 63.15 (d) Financial Institutions/ Banks (e) Any Other(Specify) Sub Total(A)(1) 2 2,91,29,366 2,91,29,366 63.15 63.15 2 Foreign a Individuals (Non-Resident

Individuals/Foreign Individuals)

b Bodies Corporate c Institutions d Qualified Foreign Investors e Any Other (specify) Sub Total(A)(2) 0 0 0 0.00 0.00 Total Shareholding of

Promoter and Promoter Group (A)= (A)(1)+(A)(2) 2 2,91,29,366 2,91,29,366 63.15 63.15

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Category code

Category of Shareholder

Number of Shareholders

Total number of shares

Number of shares held in dematerialized form

Total shareholding as a percentage of total number of

shares

Shares Pledged or otherwise encumbered

As a percentage of (A+B)1

As a percentage of

(A+B+C)

Number of shares

As a percentage

(B) Public shareholding 3 N.A. N.A. 1 Institutions N.A. N.A.

(a) Mutual Funds/ UTI 0 0 0 0.00 0.00 (b) Financial Institutions /Banks

4 83,013 83,013 0.18 0.18 (c) Central Government/ State

Government(s)

(d) Venture Capital Funds (e) Insurance Companies (f) Foreign Institutional Investors 4 52,317 52,317 0.11 0.11 (g) Foreign Venture Capital

Investors (h) Qualified Foreign Investors (i) Any Other (specify) 1. Trust 0 0 0 0.00 0.00 Sub-Total (B)(1) 8 1,35,330 1,35,330 0.29 0.29 2 Non-institutions

(a) Bodies Corporate 1,161 38,22,685 38,22,685 8.29 8.29 (b) Individuals- i. Individual shareholders

holding nominal share capital up to Rs 1 lakh 1,00,077 1,05,64,029 1,05,36,060 22.90 22.90

ii. Individual shareholders holding nominal share capital in excess of Rs. 1 lakh. 22 15,52,306 15,52,306 3.37 3.37

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Category code

Category of Shareholder

Number of Shareholders

Total number of shares

Number of shares held in dematerialized form

Total shareholding as a percentage of total number of

shares

Shares Pledged or otherwise encumbered

As a percentage of (A+B)1

As a percentage of

(A+B+C)

Number of shares

As a percentage

(c) Qualified Foreign Investors

(d) Any Other (specify) 1. Clearing Member 309 6,43,977 6,43,977 1.40 1.40 2. NRI (Repartriate) 634 2,45,504 2,45,454 0.53 0.53 3. NRI (Non-Repartriate) 155 32,069 32,069 0.07 0.07 4. HUF 1 900 0 0.00 0.00 5. Trust 1 4 4 0.00 0.00 Sub-Total (B)(2) 1,02,360 1,68,61,474 1,68,32,555 36.56 36.56

Total Public Shareholding (B)= (B)(1)+(B)(2) 1,02,368 1,69,96,804 1,69,67,885 36.85 36.85

TOTAL (A)+(B) 1,02,370 4,61,26,170 4,60,97,251 100.00 100.00

(C) Shares held by Custodians and against which Depository Receipts have been issued N.A. N.A. N.A.

1 Promoter and Promoter Group

2 Public

GRAND TOTAL (A)+(B)+(C) 1,02,370 4,61,26,170 4,60,97,251 100.00 100.00

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4. The list of top 10 shareholders of our Company and the number of Equity Shares held by them is as under:

a. As of July 27, 2012:

S.No. Name of the Shareholder Number of shares Percentage of shareholding

1 Reliance Land Private Limited 2,06,00,000 44.66 2 Reliance Capital Limited 85,29,366 18.49 3 Manmohan Shetty 7,91,234 1.72 4 Thalia Infratech Private Limited 2,04,000 0.44 5 Vimgi Investments Pvt Ltd 1,56,884 0.34 6 Master Capital Services Ltd 1,43,397 0.31 7 Globe Capital Market Ltd 1,36,326 0.30 8 DLF Home Developers Limited 1,15,943 0.25 9 Shri Parasram Holdings Pvt.Ltd. 1,14,953 0.25 10 Shree Dhoot Trading & Agencies Limited 1,00,000 0.22

b. As of July 20, 2012:

Sr. No.

Name of the shareholder No. of Equity Shares held Percentage of shareholding

1. Reliance Land Private Limited 2,06,00,000 44.66 2. Reliance Capital Limited 85,29,366 18.49 3. Manmohan Shetty 8,22,484 1.78 4. Thalia Infratech Private Limited 2,04,000 0.44 5. Vimgi Investments Pvt Ltd 1,56,884 0.34 6. Master Capital Services Ltd 1,43,397 0.31 7. Globe Capital Market Ltd 1,36,326 0.30 8. DLF Home Developers Limited 1,15,943 0.25 9. Shri Parasram Holdings Pvt.Ltd. 1,14,953 0.25 10. Shree Dhoot Trading & Agencies Limited 1,00,000 0.22

c. As of July 23, 2010: Sr. No. Name of the shareholder Number of Equity Shares

held Percentage of shareholding

1. Reliance Land Private Limited 2,06,00,000 44.66 2. Reliance Capital Limited 81,05,000 17.57 3. Manmohan Shetty 20,91,234 4.53 4. Credit Suisee (Singapore) Limited 4,59,168 1.00 5. JM Financial Services Private Limited 3,00,000 0.65 6. Globe Capital Market Ltd 2,08,323 0.46 7. Thalia Infratech Private Limited 2,04,000 0.44 8. BNP Paribas Arbitrage 1,98,400 0.43 9. Religare Securities Ltd 1,91,486 0.41 10. Societe Generale 1,32,205 0.28

5. Our Company, our Directors and the Lead Manager have not entered into any buy-back

arrangement and / or safety net facility for purchase of Equity Shares from any person.

6. Our Company has not issued Equity Shares during a period of one year preceding the date of this Draft Letter of Offer.

7. None of our Promoters, directors of our Promoters, Promoter Group, our Directors and their immediate relatives have purchased or sold any Equity Shares during a period of six months preceding the date on which this Draft Letter of Offer with SEBI.

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8. Except as stated in the chapter entitled “Our Management” at page 154, none of our Directors and their immediate relatives or key management personnel hold any Equity Shares. Further, none of our Promoter Group or directors of our Promoters hold any Equity Shares in our Company.

9. Preferential allotments made by our Company after being a listed company have been made in compliance with the relevant provisions of applicable law.

10. Our Company has not issued any Equity Shares out of revaluation reserves.

11. Our Company has 1,02,370 members as of July 27, 2012.

12. Except as stated in the chapters entitled “Capital Structure” at page 69 and “History and Certain Coporate Matters” at page 132, our Company has not issued any Equity Shares pursuant to any scheme approved under the Sections 391-394 of the Companies Act.

13. Neither the Lead Manager nor any associates of the Lead Manager hold any Equity Shares in our Company.

14. All Equity Shares will be fully paid up at the time of Allotment failing which no Allotment shall be made.

15. There are no outstanding warrants, options or rights to convert debentures, loans or other instruments convertible into the Equity Shares.

16. There have been no financial arrangements whereby our Promoter Group, our Directors and their relatives have financed the purchase by any other person of securities of our Company, other than in the normal course of the business of the financing entity during a period of six months preceding the date of filing of this Draft Letter of Offer.

17. While our Company’s shareholders have at the AGM held on September 29, 2011 approved a qualified institutions placement (“QIP”) of Equity Shares or instruments that are convertible into or exchangeable with Equity Shares, in one or more tranches, upto an aggregate amount not exceeding `50,000 lakhs. Our Company may undertake the QIP in accordance with the ICDR Regulations. Except as stated above, there will be no further issue of Equity Shares, whether by way of issue of bonus shares, preferential allotment, rights issue, or in any other manner during the period commencing from submission of this Draft Letter of Offer with SEBI until the Equity Shares have been listed.

18. Except the QIP as set out above, our Company presently does not intend or propose to alter the capital structure for a period of six months from the Issue Opening Date, by way of split or consolidation of the denomination of Equity Shares or further issue of Equity Shares (including issue of securities convertible into or exchangeable, directly or indirectly for Equity Shares) whether on a preferential basis or issue of bonus or rights or further public issue of specified securities or otherwise. However, if our Company enters into acquisitions, joint ventures or other arrangements, our Company may, subject to necessary approvals, consider raising additional capital to fund such activity or use Equity Shares as currency for acquisitions or participation in such joint ventures.

19. Further, the shareholders of our Company pursuant to a resolution passed at the AGM held on August 31, 2010 have in terms of section 81(1A) of the Companies Act and the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, accorded their consent to our Board of Directors to introduce and implement the Reliance MediaWorks Employee Stock Option Scheme (“ESOS Scheme”). In terms of the resolution, our Board of Directors is also authorised to issue and allot Equity Shares of our Company and/or options giving rights to purchase or subscribe such number of Equity Shares/equity linked instruments including depository receipts (“ESOS Securities”) which could give rise to the issue of Equity Shares of our Company, to the permanent employees of our Company, our Subsidiaries and our Directors on such terms as may be decided by our Board of Directors.

81

Additionally, the number of ESOS Securities issued to any single employee, including any non executive or independent director, during any one year shall be less than 1% of the issued and paid up Equity Shares of our Company i.e. upto 4,61,261 Equity Shares. However, the aggregate number of securities issued shall not exceed 10% of the paid up share capital of our Company as on August 2, 2010 i.e. 46,12,617 Equity Shares. As on the date of this Draft Letter of Offer, our Company has not granted any ESOS Securities under the aforesaid scheme.

20. At any given time, there shall be only one denomination of the Equity Shares, unless otherwise permitted by law. Our Company shall comply with such disclosure and accounting norms as may be specified by SEBI from time to time.

21. The Equity Shares are fully paid up and there are no partly paid up Equity Shares as on the date of filing this Draft Letter of Offer.

22. The Issue will remain open for a minimum of 15 days. The Board of Directors or duly authorised committee thereof shall have the right to extend the Issue period as it may determine from time to time, provided that the issue will not be kept open in excess of 30 days from the Issue Opening Date.

23. An over-subscription to the extent of 10% of the Issue may be retained for the purpose of rounding

off to the nearer multiple of minimum allotment lot.

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OBJECTS OF THE ISSUE The objects of the Issue are: 1. Repayment / prepayment of debt; and 2. General corporate purposes. The main objects set out in our Memorandum of Association enable us to undertake our existing activities and the activities for which funds are being raised by us through the Issue. Requirement of Funds The details of the Net Proceeds are set forth in the following table: Sr. No. Description Amount (In ` lakhs) 1. Gross proceeds of the Issue 60,000 2. Issue expenses [●] 3. Net Proceeds [●] Means of Finance The following table details the objects of the Issue and the amount proposed to be financed from the Net Proceeds of the Issue: Sr. No.

Objects of the Issue Amount proposed to be financed from Net

Proceeds of the Issue (In ` lakhs)

Percentage amount proposed to be financed from Net

Proceeds of the Issue (%)

1. Repayment/ prepayment of debt to Reliance Capital Limited, viz one of our Promoters

38,000 [●]

2. Repayment/ prepayment of debt to financial entities

17,600 [●]

3. General corporate purposes [●] [●] Total [●] [●] Utilization of Net Proceeds The details of utilisation of gross proceeds of the Issue will be in accordance with the table set forth below:

Sr. No. Particulars Amount to be utilised (In ` lakhs)

Fiscal 2013 1. Repayment/ prepayment of debt to Reliance Capital

Limited, viz one of our Promoters 38,000

2. Repayment/ prepayment of debt to financial entities 17,600 3. General corporate purposes [●] Total [●] Details of the Objects of the Issue The stated objects of the Issue are proposed to be financed entirely out of the Net Proceeds. The Net Proceeds, after deduction of all issue expenses, are estimated to be approximately `[●] lakhs. The details in relation to Objects of the Issue are set forth herein below. The fund requirement described below is based on the management estimates and is not appraised by any bank or financial institution. In case of any shortfall or any variation in the actual utilization of funds

83

earmarked for the objects mentioned above, such shortfall or increased fund deployment for a particular activity will be financed through internal accruals and additional borrowings. If there is any surplus from the Net Proceeds after meeting all the above mentioned objects, such surplus proceeds will be used for general corporate purposes. 1. Repayment of debt

Our Company has availed of certain long-term and other short-term loan facilities from various banks and financial institutions and our Promoter. These loan facilities aggregated to `2,58,648.49 lakhs as at June 30, 2012 and the amount outstanding under these facilities as at June 30, 2012 was ` 1,85,760.69 lakhs. For further details of the long-term and short-term loan facilities availed by our Company, please see the chapter entitled “Financial Indebtedness” at page 475. Our Company intends to utilise `55,600 lakhs towards repayment and/or pre-payment of a portion of such outstanding debt. The following table provides the details of the unsecured loans availed by our Company which are proposed to be repaid and/or prepaid out of the Net Proceeds (“Identified Loans”):

Sr. no.

Name of the lenders

Nature of borrowing

Amount sanctioned (In `̀ lakhs)

Principal amount

outstanding as at June 30, 2012

(In `̀ lakhs)

Interest

Tenure

Repayment

1. Reliance Capital Limited

Inter corporate deposit facility agreement dated March 7, 2012

25,187.50 22,504.92 13.00% p.a.

One year from the date of disbursement

On Demand

2. Magma Fin Corp Ltd

Inter corporate deposit facility agreement dated March 26, 2012

2,200.00 2,200.00 12.00% p.a.

6 months from date of drawl

On Demand

3. Reliance Capital Limited

Inter corporate deposit facility agreement dated March 30, 2012

1,900.00 1,900.00 13.00% p.a.

One year from the date of disbursement

On Demand

4. Reliance Capital Limited

Inter corporate deposit facility agreement dated April 3, 2012

18,850.00 18,850.00 13.00% p.a.

One year from the date of disbursement

On Demand

5. Magma Fin Corp Ltd

Inter corporate deposit facility agreement dated April 30, 2012

1,300.00 1,300.00 12.00% p.a.

6 months from date of drawl

On Demand

6. Reliance Capital Limited

Inter corporate deposit facility agreement dated May 7, 2012

39,840.00 39,840.00 13.00% p.a.

One year from the date of disbursement

On Demand

7. Reliance Capital Limited

Inter corporate deposit facility agreement dated June 7, 2012

3,863.50 3,863.50 13.00% p.a.

One year from the date of disbursement

On Demand

8. Barclays Bank PLC

Unsecured Redeemable Non - Convertible Debentures

4,400.00 4,400.00 12.50% p.a., compounded monthly

Series A – September 18, 2012 Series B – December 10,

Series A – September 18, 2012 – Rs. 550.00 Series B –

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Sr. no.

Name of the lenders

Nature of borrowing

Amount sanctioned (In `̀ lakhs)

Principal amount

outstanding as at June 30, 2012

(In `̀ lakhs)

Interest

Tenure

Repayment

, payable quarterly in arrears

2012 Series C – March 10, 2013 Series D – June 10, 2013 Series E – September 10, 2013 Series F – December 10, 2013 Series G – March 10, 2014 Series H – June 10, 2014

December 10, 2012 - Rs. 550.00 Series C – March 10, 2013 - Rs. 550.00 Series D – June 10, 2013 - Rs. 550.00 Series E – September 10, 2013 - Rs. 550.00 Series F – December 10, 2013 - Rs. 550.00 Series G – March 10, 2014 - Rs. 550.00 Series H – June 10, 2014 - Rs. 550.00

Total 97,541.00 94,858.42

(1) As certified by M/s Sandeep S. Shah & Associates, Chartered Accountants vide their certificate dated July 18, 2012. We have received a letter dated July 18, 2012 from Sandeep S. Shah & Associates, Chartered Accountant certifying the following:

a. On the dates set out in the table above, our Company received an aggregate amount of `89,641.00 lakhs as loans from Reliance Capital Limited;

b. As on June 30, 2012, a sum of `86,958.42 lakhs is recorded in the books of our Company as being payable to the Reliance Capital Limited, representing the principle amount of the loans granted by Reliance Capital Limited; and

c. The interest rate payable on the RCL Loan is 13% per annum.

For further details, please see the chapter entitled “Financial Indebtedness” at page 475. Each of our Promoters have undertaken by their letters dated July 26, 2012: (a) to apply for Equity Shares being offered to us pursuant to the Rights Issue to the extent of our Rights Entitlement; (b) to apply directly or through the Company’s Promoter Group for any Equity Shares renounced in our favour; and (c) to apply directly or through the Company’s Promoter Group for any additional Equity Shares in the Rights Issue only to the extent of any unsubscribed portion of the Rights Issue, subject to applicable law, to ensure that at least 90% of the Rights Issue is subscribed.

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Reliance Capital Limited through its letter dated July 26, 2012 has consented to adjust the RCL Loan towards share application money against their Rights Entitlements and additional subscription, if any. Consequently no fresh Issue proceeds would be received by our Company to such an extent. None of the identified loans provide for any penalty in the event of pre-payment of the outstanding amounts under such loans. In addition to the above, we may also repay/pre-pay loan facilities availed from various financial institutions, including banks, in part or full. Details of our outstanding loan facilities are set out below. Sr. No.

Name of the lender*

Nature and date of the loan agreement/sanction letter

Purpose of utilisation

Amount sanctioned as at June 30, 2012 (in `̀ lakhs)*

Amount outstanding as at June 30, 2012 (in `̀ lakhs)*

Interest (% per annum)

1 Allahabad Bank

June 27, 2012 Repayment of existing commercial paper and incurring fresh capital expenditure

5,000.00 1,666.67 13.25% - (SBPLR – 1.50%) p.a.

2 Export Import Bank

June 27, 2012 7,000.00 2,333.34

3 Jammu & Kashmir Bank

June 27, 2012 7,000.00 2,333.34

4 Syndicate Bank June 27, 2012 7,000.00 2,333.34 5 Union Bank of

India June 27, 2012 6,000.00 2,000.00

6 Vijaya Bank June 27, 2012 8,000.00 2,666.67 7 Union Bank of

India Term loan agreement dated January 29, 2010 and review letter dated January 18, 2010 as modified by the sanction letter dated February 9, 2010

For financing our Company’s Studio project in Mumbai

8,000.00 5,200.00 Base Rate + 3.50% p.a.

8 Syndicate Bank General Agreement dated June 11, 2010 and the sanction letter dated May 31, 2010 as supplemented by letter dated July 18, 2011

For augmenting long term working capital requirement

15,000.00 11,250.00 Base Rate + 2.50% p.a.

9 Syndicate Bank General agreement dated June 10, 2011 and sanction letter dated June 6, 2011

Long term working capital

10,000.00 10,000.00 Base rate + 1% p.a.

Total 73,000.00 39,783.36 * As certified by Sandeep S. Shah, Chartered Accountants vide their certificate date July 18, 2012. Our Company intends to utilise the Net Proceeds to pre-pay / repay, in part or full, some of our outstanding loans availed of from various financial institutions including banks. However, our Company will not redeem the NCDs issued to Yes Bank Limited from the Net Proceeds. The rationale for pre-paying / repaying these facilities, inter alia, is to reduce our prevailing high interest costs and to increase our administrative and operating flexibility.

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We will identify the facilities to be repaid based, amongst others, on the factors set out below.

a. Sanction limits granted; b. Existence of other facilities from the same lender; c. Prevailing rate of interest; and d. Operational flexibility.

For further details regarding our indebtedness, please see the chapter entitled “Financial Indebtedness” beginning at page 475 of this Draft Letter of Offer. 2. General Corporate Purposes

Our Company intends to deploy the balance Net Proceeds aggregating `[●] lakhs for general corporate purposes, including but not restricted to, future growth requirements, strategic initiatives, partnerships, joint ventures and acquisitions, meeting exigencies which our Company in ordinary course of business may face, or any other purposes as may be approved by the Board of Directors.

3. Issue related expenses

The Issue related expenses include, among others, fees to various advisors, printing and distribution expenses, advertisement expenses, and registrar and depository fees. The estimated Issue related expenses are as follows:

Activity Expense

(` in lakhs)

Expense (% of total expenses)

Expense (% of Issue Size)

Lead Manager [●] [●] [●] Registrars to the Issue [●] [●] [●] Monitoring Agency, Legal Advisors and Bankers to the Issue

[●] [●] [●]

SCSB Commission [●] [●] [●] Others (SEBI Fees, Stock Exchange Fees, Printing, Stationery and Postage, Advertisement, etc)

[●] [●] [●]

Total estimated Issue expenses [●] [●] [●] Interim use of proceeds The management of our Company, in accordance with the policies formulated by it from time to time, will have flexibility in deploying the Net Proceeds received from the Issue. Pending utilization of the Issue Proceeds for the purposes described above, our Company intends to temporarily invest the funds in interest bearing liquid instruments including investments in mutual funds and other financial products, such as principal protected funds, derivative linked debt instruments, other fixed and variable return instruments, listed debt instruments, rated debentures or deposits with banks as may be approved by our Board of Directors. Such investments would be in accordance with the investment policies approved by our Board of Directors from time to time. Bridge Financing Facilities Our Company has not raised any bridge loans from any bank or financial institution as on the date of this Draft Letter of Offer, which are proposed to be repaid from the Net Proceeds. Monitoring of Utilisation of Funds In terms of Regulation 16 of the ICDR Regulations we are required to appoint a monitoring agency since the Issue size is in excess of `50,000 lakhs. We have, thus far, not appointed a Monitoring Agency and will appoint a Monitoring Agency prior to filing the Letter of Offer. The Monitoring Agency will monitor the utilisation of Issue Proceeds.

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Pursuant to clause 49 of the Listing Agreement, our Company shall on a quarterly basis disclose to the Audit Committee the uses and applications of the Issue Proceeds. The Audit Committee shall review the report submitted by the Monitoring Agency and make recommendations to our Board of Directors for further action, if appropriate. Our Company shall, on an annual basis, prepare a statement of funds utilised for purposes other than those stated in this Draft Letter of Offer and place it before the Audit Committee. Such disclosure shall be made only until such time that all the Issue Proceeds have been utilised in full. The statement shall be certified by the statutory auditors of our Company. Further, in accordance with clause 43A of the Listing Agreement, our Company will furnish a statement to the Stock Exchanges on a quarterly basis a statement on indicating material deviations, if any, in the utilisation of the Net Proceeds of the Issue. This information will also be published in newspapers simultaneously with the interim or annual financial results, after placing the same before the Audit Committee. Further, our Company will also inform the Stock Exchanges of deviations, if any, in the utilisation of Net Proceeds of the Issue, pointed out by the Monitoring Agency, after review by our Audit Committee and simultaneously publish the same in the newspapers. Our Company proposes to utilise the Net Proceeds to repay certain loans availed by our Company from our Promoter and related entities, as mentioned in this chapter entitled “Objects of the Issue”. Other than as mentioned in this section, no part of the Issue Proceeds will be paid by our Company as consideration to our Promoters, our Board of Directors, our Company’s key management personnel or companies promoted by our Promoters, except in the usual course of business.

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BASIS FOR ISSUE PRICE You should read the following summary with the chapter entitled “Risk Factors” at page 11 and the more detailed information about us and the restated financial statements included in this Draft Letter of Offer at page 188. The face value of each Equity Share is `5/- and the Issue Price is [●] times the face value of each Equity Share. Qualitative Factors We believe we have the following competitive strengths: 1. Strong brand recognition; 2. Multinational and diversified consumer footprint; 3. Experienced management team; 4. Ability to scale up; 5. Vertically integrated business model; 6. Strong industry relationships; and 7. Technology as a differentiator.

For further details regarding some of the qualitative factors which form the basis for computing the Issue Price please see the chapters entitled “Business” and “Risk Factors” at pages 111 and 11, respectively. Quantitative Factors Information presented in this section is derived from our standalone and consolidated restated financial statements prepared in accordance with Indian GAAP, Companies Act and the ICDR Regulations. Some of the qualitative factors which form the basis for computing Issue Price are as follows: 1. Basic Earnings Per Share (EPS) and Diluted Earnings Per Share (EPS)

Particulars Basic EPS (in `) Diluted EPS (in `) Weight Standalone Consolidated Standalone Consolidated Fiscal 2009 (10.70) (17.07) (10.70) (17.07) 1 Fiscal 2010 (19.07) (27.89) (19.07) (27.89) 2 Fiscal 2011 (52.79) (71.22) (52.79) (71.22) 3 Weighted Average (34.54) (47.75) (34.54) (47.75) 12 months ended March 31, 2012 (99.40) (124.15) (99.40) (124.15)

Note: (1) The face value of Equity Share is `5/-; and (2) Earnings per share calculations are done in accordance with AS 20 ‘Earnings per Share’ issued by the ICAI.

2. Price/Earning (P/E) ratio in relation to Issue Price of ` [●] per Equity Share

Sr. No. Particulars Standalone Consolidated

a. P/E ratio based on Basic EPS for Fiscal 2011 at the Issue Price

Cannot be computed as EPS for Fiscal 2011 is negative

Cannot be computed as EPS for Fiscal 2011 is negative

b. P/E ratio based on Diluted EPS for Fiscal 2011 at the Issue Price

Cannot be computed as EPS for Fiscal 2011 is negative

Cannot be computed as EPS for Fiscal 2011 is negative

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Sr. No. Particulars Standalone Consolidated

c. P/E ratio based on Basic EPS for the 12 months ended March 31, 2012 at the Issue Price

Cannot be computed as EPS for 12 months ended March 31, 2012 is negative

Cannot be computed as EPS for 12 months ended March 31, 2012 is negative

d. P/E ratio based on Diluted EPS for the 12 months ended March 31, 2012 at the Issue Price

Cannot be computed as EPS for 12 months ended March 31, 2012 is negative

Cannot be computed as EPS for 12 months ended March 31, 2012 is negative

Peer Group P/ E*

Particulars P/ E Ratio Highest T.V. Today Netw. - 31.7 Lowest Mukta Arts - 2.3 Average 16.6#

* P/E based on trailing twelve months earnings for the entire Entertainment/Electronic Media Software. # Industry composite Source: Capital Markets, Vol. XXVII/08, Jun 11 – 24, 2012 3. Return on Net worth (“RoNW”)

Particulars RoNW (%) Weight

Standalone Consolidated Fiscal 2009 (9.66)% (15.99)% 1 Fiscal 2010 (21.21)% (35.92)% 2 Fiscal 2011 (144.88)% (1,213.65)% 3 Weighted Average (81.12)% (621.46)% 12 months ended March, 2012

(1,261.84)% NA(1)

Note: Net worth as appearing in the restated audited standalone and consolidated summary statement of assets and liabilities for the respective period has been considered for RoNW. (1) RoNW for the 12 months ended March 31, 2012 cannot be computed as our net worth as per the consolidated restated financial statements is negative. 4. Minimum Return on Increased Net Worth Required to Maintain pre-Issue EPS as of March 31,

2012: (a) Based on Basic EPS

Based on standalone restated financial statements: Cannot be computed as EPS is negative; and Based on consolidated restated financial statements: Cannot be computed as EPS is negative.

(b) Based on Diluted EPS:

Based on standalone restated financial statements: Cannot be computed as EPS is negative; and Based on consolidated restated financial statements: Cannot be computed as EPS is negative.

5. Net Asset Value per share

NAV (`) Standalone Consolidated

NAV per Equity Share as at March 31, 2012 7.88 (52.26) NAV per Equity Share after the Issue [●] [●] Issue Price [●] [●] NAV per Share = Net worth, as restated, at the end of the period/year (excluding preference share capital and premium)/ Number of equity share outstanding at the end of the period/year.

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The Issue Price of ` [●] per Equity Share has been determined on the basis of assessment of market conditions and is justified based on the above accounting ratios.

6. Comparison with Industry Peers:

Name of the Company

Standalone/ Consolidated

12 months ended March, 2012 / Year ended

Face Value (`)

For the year/period ended March 31, 2012

Basic EPS (`) P/E(1) RONW (%) NAV

Reliance MediaWorks Limited

Stand-alone 12 months

ended March, 2012

5/- (99.40) NA 1,261.84 7.88

Reliance MediaWorks Limited

Consolidated

12 months ended March,

2012

5/- (124.15) NA NA (52.26)

Peer Group*

Fame India Limited Stand-alone

Year ended March 31,

2012

10/- (3.00) NA 6.91% 29.14

Inox Leisure Limited

Stand-alone Year ended March 31,

2012

10/- 1.67 30.72 3.13% 53.04

PVR Limited Stand-alone

Year ended March 31,

2012

10/- 10.50 14.04 9.81% 110.41

*Source: As per audited standalone financial statement Note: The peer group listed companies, as stated above are engaged in the Entertainment/Electronic Media Software sector. (1) Computed based on market price as on March 30, 2012 on NSE.

On the basis of the above qualitative and quantitative parameters, our Company, in consultation with the Lead Manager, is of the opinion that the Issue Price of ` [●] per Equity Share is justified. For further details, please see the chapter entitled “Risk Factors” at page 11 and our financials including important profitability and return ratios, as set out in the chapter entitled “Financial Statements” at page 188.

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To, The Board of Directors, Reliance Media Works Limited Filmcity Complex, Goregaon (East) Mumbai - 400065

STATEMENT OF TAX BENEFITS

We hereby report that the enclosed statement, prepared by Reliance Media Works Limited (formerly Adlabs Films Limited) (hereinafter referred to as the “Issuer”), states the possible tax benefits available to the Issuer and its members under the provisions of the Income Tax Act, 1961, Wealth Tax Act, 1957 and Gift Tax Act, 1958 presently in force in India. The benefits as stated are dependent on the Company or its shareholders fulfilling the conditions prescribed under the relevant tax laws. Hence the ability of the Company or its shareholders to derive the tax benefits is dependent upon fulfilling such conditions. The benefits discussed in the enclosed annexure are not exhaustive. This statement is only intended to provide general information to the investors and is neither designed nor intended to be a substitute for professional advice. In view of the individual nature of the tax consequences and the changing tax laws each investor is advised to consult his or her own tax consultant with respect to the specific tax implications arising out of their participation in the issue. We do not express any opinion or provide any assurance as to whether: i) the Issuer or its members will continue to obtain these benefits in future; or ii) the conditions prescribed for availing the benefits, where applicable have been / would be met The contents of the enclosed statement are based on the information, explanations and representations obtained from the Issuer and on the basis of the understanding of the business activities and operations of the Issuer and the interpretation of the current tax laws in force in India.

For JITENDRA SANGHAVI & CO. CHARTERED ACCOUNTANTS.

PLACE: MUMBAI (J.B. SANGHAVI) Date: 25.07.2012 PARTNER

Membership No.30127 Firm Reg.No.104299W

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TAX BENEFITS TO THE COMPANY AND ITS SHAREHOLDERS The tax benefits listed below are the possible benefits available under the Income Tax Act, 1961 and the Wealth Tax Act, 1957, presently in force in India. Several of these benefits are dependent on the Issuer or its members fulfilling the conditions prescribed under the relevant provisions of the respective tax laws. Hence, the ability of the Issuer or its members to derive the tax benefits is dependent upon fulfilling such conditions, which based on the business imperatives, the Issuer may or may not choose to fulfill. The benefits discussed below are not exhaustive. This statement is only intended to provide general information to the investors and is neither designed nor intended to be a substitute for professional tax advice. In view of the individual nature of the tax consequences and the changing tax laws, each investor is advised to consider in his / her own case the tax implications of an investment in the shares. Further each investor is advised to consult his or her own tax consultant with respect to the specific tax implications arising out of their participation in the issue. I. Tax Benefits available to the Issuer - under the Income Tax Act, 1961 (the Act)

A. Special Tax Benefits The Issuer does not enjoy any special tax benefits

B. General Tax Benefits

1. Depreciation Benefits

Under section 32 of the Act, the Issuer is entitled to claim depreciation at the prescribed rates on specified tangible and intangible assets used by the Issuer for the purposes of its business and subject to other conditions listed in the Act.

Unabsorbed depreciation, if any, for an assessment year can be carried forward and set off against income from any other source in the subsequent assessment years as per section 32 subject to the provisions of section 72(2) and section 73(3) of the Act.

2. Minimum Alternate Tax (MAT) and Credit for the same

The Issuer would be required to pay tax on its book profits under the provisions of section 115JB in case where tax on its “total income” (the term defined under section 2(45) of the Act) is less than 18.50%(plus applicable education cess and also a surcharge in case book profit exceeds Rs.100 lakhs) of its “book profits” (the term defined under section 115JB of the Act). Such tax is referred to as Minimum Alternate Tax (MAT).

The difference between the MAT paid for any assessment year commencing on or after April 1, 2006 and the tax on its total income payable for that assessment year shall be allowed to be carried forward as “MAT credit”. The MAT credit shall be utilised to be set off against taxes payable on the total income in the subsequent assessment years. However, it can be carried forward only upto 10 assessment years succeeding the assessment year in which such MAT was paid.

3. Exemption from Dividends and Income from units of Specified Mutual Funds

Section 10(34) of the Act provides an exemption in respect of any income by way of dividends referred to in section 115-O (whether interim or final). Dividends referred to in section 115-O would cover dividends declared, distributed or paid by the domestic companies in respect of which the distributing company is liable to pay dividend distribution tax. Similarly the income received from units of a Mutual Fund specified under section 10(23D) is exempt from tax. Such income distributed by the Mutual Fund or the Administrator of the specified undertaking would also be subject to applicable dividend distribution tax, except when the distribution is made by an open ended “equity oriented fund”. It may be pertinent to note that section 14A of the Act restricts claim for deduction of expenses incurred in relation to exempt income.

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4. Dividend Distribution tax

Dividends declared / distributed / paid by the Issuer is subject to dividend distribution tax at 15 per cent (plus applicable surcharge and education cess). As per Section 115O (1A), for the purpose of calculating dividend distribution tax, the aforesaid amount of dividend shall be reduced by the amount received by the Issuer from its subsidiaries by way of dividend during the financial year provided the subsidiaries have paid dividend distribution tax.

5. Concessional rate of tax on Dividend from Foreign subsidiaries.

Dividend received by an Indian holding company from its foreign subsidiaries will be taxed at concessional rate of tax at 15 per cent under Section 115BBD.

6. Capital Gains

(a) Under section 112 of the Act, long term capital gains are subject to tax at the rate of 20% (plus applicable surcharge and education cess). Such long term capital gains are to be computed by deducting from the sale consideration (i) expenditure incurred in connection with such transfer; and (ii) except in case of certain bonds and debentures, the indexed cost of acquisition of the capital asset. In computing the long term capital gains chargeable to tax, no deduction under Chapter VI-A would be allowed under section 112 of the Act.

However, in respect of long term capital gains arising from transfer of listed securities, units or zero coupon bonds, the maximum tax payable on long term capital gains is restricted to 10% of the capital gains calculated without indexation of the cost of acquisition.

Further, in terms of section 10(38) of the Act, any long term capital gain arising to the Issuer on or after October 1, 2004, from the transfer of a long term capital asset being an equity share in a company or a unit of an equity oriented fund, where such transaction is chargeable to securities transaction tax (STT), is exempt from tax in the hands of the Issuer. However, long term capital gains earned by the Issuer shall be taken into account in computing the book profits for the purposes of computation of MAT.

(b) In terms of section 111A of the Act any short term capital gains arising to the Issuer from

the transfer of a short term capital asset being an equity share in a company or unit of an equity oriented fund, where such transaction is chargeable to STT, would be subject to tax only at a rate of 15% (plus applicable surcharge and education cess). In other cases, the short term capital gains would be chargeable to tax at 30 per cent (plus applicable surcharge and education cess). Further, deduction under Chapter VI-A would not be allowed from such short term capital gains subject to tax under section 111A of the Act.

(c) As per the provisions of section 54EC of the Act and subject to the conditions specified

therein, long term capital gains arising to the Issuer {other than those exempt under section 10(38)} shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If only part of the capital gain is so reinvested, the exemption shall be proportionately reduced.

However, if the assessee transfers or converts the notified bonds into money within a

period of three years from the date of their acquisition, the amount of capital gains exempted earlier would become chargeable to tax as long term capital gains in the year in which such bonds are transferred or otherwise converted into money. The maximum investment permissible for the purposes of claiming the exemption in the above bonds by any person in a financial year is `50 lakhs.

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II. Tax Benefits available to the Members of the Company under the Act

I. Special Tax Benefits There are no special tax benefits available to the members of the Company.

II. General Tax Benefits

2.1 Resident Members

a) Under section 10(32) of the Act, any income of minor children clubbed in the total income of the parent under section 64(1A) of the Act, will be exempt from tax to the extent of `1,500 per minor child, whose income is so included.

b) The characterization of gains / losses, arising from sale of shares, as capital gains or

business income would depend on the nature of holding in the hands of the member and various other factors.

c) Section 10(34) of the Act provides an exemption in respect of any income by way of

dividends referred to in section 115O (whether interim or final). Dividends referred to in section 115-O would cover dividends declared, distributed or paid by the domestic companies in respect of which the distributing company is liable to pay dividend distribution tax. However, it may be pertinent to note that section 14A of the Act restricts claim for deduction of expenses incurred in relation to exempt income

d) Under section 111A of the Act, capital gains arising from transfer of short term capital

assets, inter alia being an equity share in a company, which is subject to STT will be taxable at 15 per cent (plus applicable surcharge and educational cess). In other cases, the short term capital gains would be chargeable as part of the total income and the tax rates would depend on the income slab. Further no deduction under Chapter VI-A would be allowed in computing such short term capital gains subject to tax under section 111A of the Act.

e) Under section 112 of the Act, long term capital gains are subject to tax at the rate of 20%

(plus applicable surcharge and education cess). Such long term capital gains are to be computed by deducting from the sale consideration (i) expenditure incurred in connection with such transfer; and (ii) except in case of certain bonds and debentures the indexed cost of acquisition of the capital asset. In computing the long term capital gains chargeable to tax, no deduction under Chapter VI-A would be allowed under section 112 of the Act.

However, in respect of long term capital gains arising from transfer of listed securities,

units or zero coupon bonds, the maximum tax payable on long term capital gains is restricted to 10% of the capital gains calculated without indexation of the cost of acquisition.

Further, in terms of section 10(38) of the Act, any long term capital gain arising to the

Issuer on or after October 1, 2004, from the transfer of a long term capital asset being an equity share in a company, where such transaction is chargeable to securities transaction tax (STT), is exempt from tax in the hands of the Issuer. However, in case of companies, long term capital gains earned by the Issuer shall be taken into account in computing the book profits for the purposes of computation of MAT.

f) As per the provisions of section 54EC of the Act and subject to the conditions specified

therein, long term capital gains arising to the members {other than those exempt under section 10(38)} shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If only part of the capital gain is so reinvested, the exemption shall be proportionately reduced.

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However, if the assessee transfers or converts the notified bonds into money within a period of three years from the date of their acquisition, the amount of capital gains exempted earlier would become chargeable to tax as long term capital gains in the year in which such bonds are transferred or otherwise converted into money. The maximum investment permissible for the purposes of claiming the exemption in the above bonds by any person in a financial year is `50 lakhs.

g) Under section 54F of the Act, where in the case of an individual or HUF capital gain arise

from transfer of long term assets {other than a residential house and those exempt under section 10(38) of the Act} then such capital gain, subject to the conditions and to the extent specified therein, will be exempt if the net sales consideration from such transfer is utilised, for purchase of residential house property within a period of one year before or two year from the date of transfer, or for construction of residential house property within a period of three years after the date of transfer. If only a part of the net consideration is so reinvested, the exemption shall be proportionately reduced.

h) In terms of section 36(xv) of the Act, the STT paid by the member in respect of the

transactions entered into in the course of the business would be deductible while computing income chargeable under the head “Profits and Gains under Business or Profession” arising from taxable securities transactions.

i) As per the provisions of section 10(23D) of the Act, all mutual funds set up by public

sector banks, public financial institutions or mutual funds registered under the Securities and Exchange Board of India (SEBI) or authorised by the Reserve Bank of India are eligible for exemption from income-tax, subject to the conditions specified therein, on their entire income including income from investment in the shares of the company.

2.2 Non Resident Members other than Foreign Institutional Investors

a) Under section 10(32) of the Act, any income of minor children clubbed in the total income of the parent under section 64(1A) of the Act, will be exempt from tax to the extent of `0.015 lakh per minor child, whose income is so included.

b) The characterization of gains / losses, arising from sale of shares, as capital gains or

business income would depend on the nature of holding in the hands of the member and various other factors.

c) Section 10(34) of the Act provides an exemption in respect of any income by way of

dividends referred to in section 115O (whether interim or final). Dividends referred to in section 115-O would cover dividends declared, distributed or paid by the domestic companies in respect of which the distributing company is liable to pay dividend distribution tax. However, it may be pertinent to note that section 14A of the Act restricts claim for deduction of expenses incurred in relation to exempt income.

d) Under section 111A of the Act, capital gains arising from transfer of short term capital

assets, inter alia being an equity share in a company, which is subject to STT will be taxable at 15 per cent (plus applicable surcharge and educational cess). In other cases, the short term capital gains would be chargeable as part of the total income and the tax rates would depend on the income slab. Further no deduction under Chapter VI-A would be allowed in computing such short term capital gains subject to tax under section 111A of the Act.

e) Under section 112 of the Act, long term capital gains would be subject to tax at the rate of

20% (plus applicable surcharge and education cess). Such long term capital gains are to be computed by deducting from the sale consideration (i) expenditure incurred in connection with such transfer; and (ii) the cost of acquisition of the capital asset from the sale consideration. However, there exists a special provision for non residents providing for adjustments to the cost of acquisition, in respect of exchange rate fluctuations, in

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computing the capital gains. Further, in computing the long term capital gains chargeable to tax, no deduction under Chapter VI-A would be allowed under section 112 of the Act Further, in terms of section 10(38) of the Act, any long term capital gain arising on or after October 1, 2004, from the transfer of a long term capital asset inter alia being an equity share in a company, where such transaction is chargeable to STT, is exempt from tax in the hands of the member. However, in the case of companies, long term capital gains so earned shall be taken into account in computing the book profits for the purposes of computation of MAT.

f) As per the provisions of section 54EC of the Act and subject to the conditions specified therein, long term capital gains arising to the members {other than those exempt under section 10(38)} shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If only part of the capital gain is so reinvested, the exemption shall be proportionately reduced. However, if the assessee transfers or converts the notified bonds into money within a period of three years from the date of their acquisition, the amount of capital gains exempted earlier would become chargeable to tax as long term capital gains in the year in which such bonds are transferred or otherwise converted into money. The maximum investment permissible for the purposes of claiming the exemption in the above bonds by any person in a financial year is `50 lakhs.

g) Under section 54F of the Act, where in the case of an individual or HUF capital gain arise from transfer of long term assets {other than a residential house and those exempt under section 10(38) of the Act} then such capital gain, subject to the conditions and to the extent specified therein, will be exempt if the net sales consideration from such transfer is utilised, for purchase of residential house property within a period of one year before or two year from the date of transfer, or for construction of residential house property within a period of three years after the date of transfer. If only a part of the net consideration is so reinvested, the exemption shall be proportionately reduced.

h) In terms of section 36(xv) of the Act, the STT paid by the member in respect of the

transactions entered into in the course of the business would be deductible while computing income chargeable under the head “Profits and Gains under Business or Profession” arising from taxable securities transactions.

i) As per section 90 of the Act, the provisions of the Act or the provisions of the applicable

Double Tax Avoidance Agreement, whichever is more beneficial to the taxpayer / assessee, would apply.

2.3 Special optional provisions available to Non Resident Indians under the Act

a) A Non Resident Indian (NRI), i.e. an individual being a citizen of India or person of Indian origin has an option to be governed by the special provisions contained in Chapter XII-A of the Act, i.e. “Special Provisions relating to certain incomes of Non-Residents”.

b) Under section 115E of the Act, where the NRI has subscribed the shares of the company in

convertible foreign exchange, long term capital gains arising to the non resident on transfer of such shares {in cases not covered under section 10(38) of the Act} be chargeable to tax at concessional flat rate of 10% (plus applicable surcharge and educational cess). In computing the capital gains for non residents, arising from transfer of shares or debentures of an Indian company, no indexation benefit is allowed. However, in such cases all the non residents have been provided with a protection against foreign exchange fluctuation under the first proviso to section 48 of the Act.

c) Under provisions of section 115F of the Act, long term capital gains {not covered under

section 10(38) of the Act} arising to the NRI from the transfer of such shares shall be

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exempt from income tax if the net consideration is reinvested in specified assets within six months of the date of transfer. If only part of the net consideration is so reinvested, the exemption shall be proportionately reduced. The amount so exempted shall be chargeable to tax subsequently, if the specified assets are transferred or otherwise converted into money within three years from the date of their acquisition.

d) Under provisions of section 115G of the Act, it shall not be necessary for the NRI to

furnish his return of income if his only source of income is investment income or long term capital gains or both arising out of assets acquired, purchased or subscribed in convertible foreign exchange and tax deductible at source has been deducted there from.

e) Under section 115-I of the Act, the NRI may elect not to be governed by the provisions of

Chapter XII-A of the Act for any assessment year by furnishing his return of income under section 139 of the Act declaring therein that the provisions of the Chapter shall not apply to him for that assessment year and if he does so the provisions of this Chapter shall not apply to him. In such a case the tax on investment income and long term capital gains would be computed as per normal provisions of the Act, in which case the above stated provisions from point (c) to (h) in Para 2.2 would be applicable.

2.4 Foreign Institutional Investors (FIIs)

a) Section 10(34) of the Act provides an exemption in respect of any income by way of dividends referred to in section 115-O (whether interim or final). Dividends referred to in section 115-O would cover dividends declared, distributed or paid by the domestic companies in respect of which the distributing company is liable to pay dividend distribution tax.

b) The characterization of gains / losses arising from sale of shares as capital gains or business income would generally depend on the nature of holding in the hands of the member and various other factors.

c) Under section 111A of the Act, capital gains arising from transfer of short term capital assets, inter alia being an equity share in a company, which is subject to STT will be taxable at 15 per cent (plus applicable surcharge and educational cess). In other cases, the short term capital gains would be chargeable to tax at 30per cent (plus applicable surcharge and education cess).

d) Under section 10(38) of the Act, any long term capital gain arising on or after October 1,

2004, from the transfer of a long term capital asset inter alia being an equity share in a company, where such transaction is chargeable to STT, is exempt from tax in the hands of the member. However, in the case of companies, long term capital gains so earned may be taken into account in computing the book profits for the purposes of computation of MAT.

e) Section 115AD provides special provisions for taxability of various types of income of

FIIs. Under section 115AD long term capital gains arising from transfer of shares in a company {other than those mentioned in point (d) above}, are taxed at the rate of 10% (plus applicable surcharge and education cess). Such capital gains would be computed without giving effect to the first and second proviso to section 48 of the Act. In other words, the benefit of indexation or the adjustment in respect of foreign exchange fluctuation, as mentioned under the two provisos would not be allowed while computing the capital gains.

f) As per the provisions of section 54EC of the Act and subject to the conditions specified

therein, long term capital gains arising to the investors / members {other than those exempt under section 10(38)} shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If only part of the capital gain is so reinvested, the exemption shall be proportionately reduced.

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However, if the assessee transfers or converts the notified bonds into money within a period of three years from the date of their acquisition, the amount of capital gains exempted earlier would become chargeable to tax as long term capital gains in the year in which such bonds are transferred or otherwise converted into money. The maximum investment permissible for the purposes of claiming the exemption in the above bonds by any person in a financial year is `50 lakhs.

g) As per section 90 of the Act, the provisions of the Act or the provisions of the applicable Double Tax Avoidance Agreement, whichever is more beneficial to the taxpayer / assessee, would apply.

III. Tax Benefits under the Wealth Tax Act, 1957

Shares in a company held by a member will not be treated as an asset within the meaning of section 2(ea) of Wealth-tax Act, 1957. Hence, wealth tax is not leviable on shares held in a company.

IV. The Gift Tax Act, 1958

Since the provisions of The Gift Tax Act, 1958 have ceased to apply with effect from October 1, 1998 , gift of shares made on or after October 1, 1998 will not be liable to Gift Tax under the Gift Tax Act, 1958. However, pursuant to the Finance Act, 2009, Section 56 of the Act has been amended to provide that the value of any property, including shares and securities, received without consideration or for inadequate consideration (from persons or in situations other than those exempted under section 56 (vii) of the Act) will be included in the computation of total income of the recipient and be subject to tax.

V. Direct Tax Code The above statement does not provide the tax benefits under the Direct Tax Code which is likely to be implemented from A.Y. 2013-14. The tax benefits under the said code are not furnished as the same is under formative stage.

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SECTION IV: ABOUT THE COMPANY

INDUSTRY OVERVIEW We have relied on websites and publicly available documents from various sources. The data may have been re-classified by us for the purpose of presentation. Neither we nor any other person connected with the Offer has independently verified the information provided in this chapter. Industry sources and publications, referred to in this section, generally state that the information contained therein has been obtained from sources generally believed to be reliable but their accuracy, completeness and underlying assumptions are not guaranteed and their reliability cannot be assured, and, accordingly, investment decisions should not be based on such information Overview of the Indian Economy India is one of the fastest growing economies in the world with a rapidly expanding entertainment and media (“E&M”) industry. According to the Ministry of Statistics and Programme Implementation’s (MOSPI) revised estimates, India’s real GDP registered a lower growth of 6.9% during Fiscal 2012, as compared with 8.4% in Fiscal 2011, largely attributable to global factors include in particular, the crisis in the euro zone area and near recessionary conditions prevailing in Europe, slow growth in many other industrialized countries, increase in crude price rate, etc. However, relative to many other economies in the world, growth of 6.9 per cent in India is among the highest. The following table illustrates India's real GDP growth between financial years 2009 and 2012 (at factor cost at constant 2004-05 prices): Fiscal 2009 Fiscal 2010 Fiscal 2011 Fiscal 2012 Real GDP Growth Rate (%) 6.7% 8.4% 8.4% 6.9% Source: Ministry of Statistics and Programme Implementation Overview of the Indian Entertainment and Media Industry The Indian E&M industry (primarily comprised, among others, of film, television, print media, animation and visual effects VFX, radio and music) has witnessed steady growth in recent years and is estimated to have reached `72,80,000 lakhs in 2011. The Indian E&M industry is projected to grow at a compound annual growth rate (“CAGR”) of 14.90% from the year 2011 to the year 2016 to reach `1,45,70,000 lakhs. The Indian E&M industry has grown at a CAGR of 9.09% between 2007 and 2011. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) The following factors are expected to contribute to further growth of the Indian E&M industry: the continued growth and development of the Indian economy; favourable demographic characteristics and trends in India; the cultural diversity of the Indian population; the internationalisation of the Indian E&M industry; the availability of popular content; and digitisation of content.

The following chart illustrates the growth of the Indian E&M industry.

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P=Projected (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) The following table provides the expected sizes and growth rates of the various segments of the Indian E&M industry for the years 2011 through 2016:

(`̀ lakhs) E&M Industry

Segment 2011 2012P 2013P 2014P 2015P 2016P CAGR (2011

to 2016)

T.V. 329000

0 380000

0 435000

0 5140000 6180000 7350000 17.00%

Print 208800

0 226000

0 246800

0 2700000 2949000 3234000 9.00%

Film 929000 100000

0 109700

0 1211000 1345000 1503000 10.00% Radio 115000 130000 160000 200000 240000 295000 21.00% Music 90000 100000 113000 131000 154000 182000 15.00% O.O.H. 178000 195000 215000 236000 260000 290000 10.00% Animation 310000 363000 430000 511000 610000 690000 17.00% Gaming 130000 180000 230000 290000 370000 460000 29.00% Digital Advertising 154000 199000 258000 335000 437000 570000 30.00%

Total 728400

0 822700

0 932100

0 1075400

0 1254500

0 1457400

0 14.90% *P=Projected (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) Favourable Demographic Characteristics and Trends in India The growth of the Indian economy has led to increased income levels and has resulted in the availability of greater amounts of disposable income. It is estimated that the number of households with an income of less than ` 0.90 lakhs per year will decrease from approximately 1,011 lakhs households in 2005 to 499 lakhs households in 2025. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2009”) The following chart illustrates certain expected changes in the distribution of income groups in India:

(`Billion)

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E=Estimated (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2009”) Approximately 70.0% of India’s population was below 35 years of age in 2001. More than 50.0% percent of India’s population is expected to be under the age of 30 in 2015. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2009”) The following chart illustrates the population distribution in India across various age groups:

(Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2009”) Cultural Diversity of the Indian Population India is a country with significant geographic, linguistic and cultural diversity. Although catering to India’s diversity is challenging for the E&M industry, such diversity broadens the scope of services offered and reduces the concentration of business risk. Regional content has emerged as one of the most significant aspects of content customisation and has become a significant growth driver for the E&M industry in India. The following charts illustrate the linguistic composition of the Indian film market, by shares of the number of films released:

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(Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) Certain E&M trends with regard to diversity include the growth in popularity of regional channels and the expansion of regional channel portfolios by regional and national media companies. Content preferences have shifted more towards socially relevant and localised / regionalised programs, such as Phulwa (Chambal forest in MP), Diya Aur Baati Hum (Pushkar, Rajasthan), Agle Janam (Uttar Pradesh and Bihar), Pavitra Rishta (Maharashtra), Balika Vadhu (Rajasthan) and Laado (Haryana). Large broadcasters have looked at increasing their presence in regional market by new channel launch and M&A activity for example, launch of Discovery Tamil, ETV’s takeover by Network 18 etc. Dainik Bhaskar entered Marathi by launching editions in Aurangabad, Nasik, Jalgaon and Ahmednagar and strengthened its position on Rajasthan and Jharkhand by launching more editions.(Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) Internationalisation of the Indian E&M Industry Indian E&M companies have begun targeting international markets. International demand for Indian content has grown and a number of Indian television channels are currently broadcast across the world. For example, NDTV has launched NDTV Arabia and NDTV Malaysia. Regional language channels such as Asianet have also been broadcasting overseas. “Colors” was recently launched in the United States and the UK as “Aapka Colors”. Content produced in India is targeted largely at the Indian diaspora in key markets, primarily the United States, the UK, United Arab Emirates and South Africa. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2009” & “Indian Media & Entertainment Industry Report 2010”) Further, in recent years, some large budget and popular Hindi films have generated a significant share of their box office earnings overseas. Overseas theatrical revenues alone have accounted for approximately 7.4% of Indian film industry revenues in CY 2011, which is complemented by overseas home viewing revenue streams such as DVD and satellite broadcasts. Due to the presence of a significant non-resident Indian population in countries around the world, E&M companies expect to increase their revenues from such international markets and are now attempting to target non-resident Indians with their productions. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) The Availability of Popular Content Over the years, the availability and variety of Indian film content has increased. More than 5 films have breached the level of `10,000 lakhs in 2011, doubling the count of films as compared to last year. Further, it was not just the A-list star cast films that did well, niche / focussed content from independent film-makers also gained widespread acceptance. “Ragini MMS”, “Murder 2” and “Tanu weds Manu” performed well at the box office in 2011. Themes that were women oriented such as “No One Killed Jessica” and “The Dirty

103

Picture”, horror based “Haunted”, urbane life based “Zindagi Na Milegi Dobara”, “Delhi Belly” and romance based “Ladies v/s Ricky Bahl” were all box-office hits. The Indian film industry has also witnessed the increasing use of special effects and film viewing technologies. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) Digitisation of Content Digitisation is changing the Indian E&M industry. The introduction of the Conditional Access System has led to the increasing popularity of digital cable. Further, the advent of direct-to-home service providers such as Dish TV, Tata Sky, Sun, Big TV and Airtel Digital TV and the commercial launch of Internet protocol television has increased the digitisation of E&M content. Digitisation has reached every aspect of the film-making process in India, from production and post-production to distribution and projection. Further, recently, the Central Government has made digitization of cable television mandatory by October 31, 2012, in Mumbai, Delhi, Chennai and Kolkata. Segments of the Indian E&M industry The Indian E&M industry is primarily comprised, among others, of film, television, and animation and VFX segments. Film The film segment is one of the largest segments of the E&M industry and is primarily comprised of films distributed through theatrical exhibition, home video, C&S television. The film segment has grown from `833,000.00 lakhs in 2010 to `929,000.00 lakhs in 2011 at a CAGR of 11.50%. In 2012, the film segment contributed approximately 12.80% of India’s total E&M industry revenue. The Indian film industry is projected to grow at a CAGR of 10.00% from 2011 to 2016 to reach approximately `1,503,000 lakhs in 2016. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) Recent Trends in the Indian Film Industry In the recent past, the following trends have emerged in the Indian film industry: Production of Big Budget Films Over the last few years, the number of films that have released with 500 or more prints has been increasing. The number of such films has increased to 40 in the calendar year 2011 from 30 in the calendar year 2008 and the net box office collection of the top 50 films in India has increased to approximately `1,67,730.00 lakhs in calendar year 2011 from approximately `1,14,400.00 lakhs in calendar year 2008. Five large distributors in the Hindi film industry, Yash Raj Films Limited, Reliance Big Entertainment Private Limited (formerly, Reliance BIG Pictures), Dharma Productions Private Limited, UTV, and Eros International Media Limited are expected to release approximately 20 films in the next 18 months. (Source: www.boxofficeindia.com) Pan-India Release of Films In recent years, there has been a growing trend among Indian producers and distributors to release the films across larger networks via analogue or digital media. Pan-India releases enable producers to take advantage of the publicity and attention which the film receives at the time of release. Further, it also helps to curb down the incidence of piracy. Exploitation of the Overseas Market by the Indian Film Industry The growing popularity of Indian film content overseas has opened new avenues for the Indian film industry. While the US region, UK and Middle East continue to account for the bulk of overseas revenues; markets in South Korea, Western Europe, Taiwan and Africa are gearing up for Hindi films. Studios continue to seed new markets for Indian films. For example, Vijay’s Tamil film was screened in Denmark and ‘Kites’ was

104

screened in Latin America. In 2011, ‘Ra-One’ and ‘Bodyguard’ were released with over 900 prints in the overseas market. The industry believes that it is a question of influencing consumption patterns and cultivating relationships with the local partners. The contribution of overseas revenue in the total film’s revenue can go up from its current levels of 10-15 percent to upwards of 40 percent. While most benefits from these markets would accrue to the big budget films, there trickledown effect to quality content in medium and low budget films is expected. Along with identification of new markets, Industry believes that growth would also be driven by enhanced overseas marketing campaign and increased penetration in existing areas. As a result of these and other factors, overseas theatrical revenues are expected to increase from approximately `69,000.00 lakhs in 2011 to approximately `1,15,000.00 lakhs in 2016 and are expected to constitute approximately 10.50% of Indian films’ total revenues in 2016. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) Growing Popularity of Hollywood and other Western Films Among the Indian Population Along with changing lifestyles, the film preference of the Indian population is shifting towards Hollywood and other Western films. The success of Hollywood films in India can be attributed to a number of factors such as an ever rising English speaking population, the growth of multiplexes, increased international exposure through internet, television and tourism, Hindi and local language dubbing and simultaneous global releases. Given the rising importance of the Indian market for Hollywood producers, a large number of films are being released in India prior to the US release to play on the prestige factor of watching films before the rest of the world. In 2011, ten Hollywood films were released in India prior to their release in their home market. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) Revenue Streams of the Indian Film Industry Domestic theatrical exhibition is the largest contributor of revenue for the Indian film industry. The second largest contributor is overseas theatrical. However, contributions from cable and satellite rights are growing at a faster pace and are likely to emerge as the second largest contributor in the near future. The following chart illustrates the components of the Indian film industry revenue streams for the years 2007 through 2016:

P=Projected (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”)

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Domestic Theatrical In 2011, theatrical revenue (including overseas collections) constituted approximately 81.5% of total Indian film industry revenue. The revenue from domestic theatrical exhibition has increased from `620,000.00 lakhs in 2010 to `689,000.00 lakhs in 2011, increase of 10.0%. This segment is expected to grow to `1,080,000.00 lakhs in 2016. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) The growth in domestic theatrical exhibition revenue is demonstrated by the following tables which provide the net box office revenues for the top 10 grossing films in India in CY 2008 and 2011:

Top 10 Films – Domestic Box Offices Revenue (Calendar Year 2008)*

Top 10 Films – Domestic Box Office Revenue (Calendar Year 2011)*

Rank Film Net Revenue (` in lakhs)

Rank Film Net Revenue (` in lakhs)

1 Ghajini 11,467.00 1 Bodyguard 14,095.00 2 Rab Ne Bana Di Jodi 8,678.00 2 Ready 12,086.00

3 Singh Is Kinng 6,848.00 3 Ra.One 11,475.00

4 Race 6,168.00 4 Don 2 (Hindi) 10,614.00

5 Jodhaa Akbar 5,903.00 5 Singham 9,776.00

6 Jaane Tu . . . Ya Jaane Na

5,641.00 6 Zindagi Na Milegi Dobara 8,988.00

7 Golmaal Returns 5,169.00 7 The Dirty Picture (Hindi) 7,986.00

8 Dostana 4,442.00 8 Rockstar 6,763.00

9 Bachna Ae Haseeno 3,664.00 9 Mere Brother Ki Dulhan 5,781.00

10 Sarkar Raj 3,396.00 10 Delhi Belly 5,521.00

Total: 61,376.00 Total: 93,085.00 (Source: www.boxofficeindia.com) *Top 10 films calculated on the basis of net collections received during the year indicated, regardless of release date. The following table provides details of the size and growth of the Indian film industry for the years 2009 through 2016:

(` in lakhs)

2009 2010 2011 2012P 2013P 2014P 2015P 2016P CAGR 2011-2016

Filmed entertainment 893,000 833,000 929,000 1,000,000 1,097,000 1,211,000 1,345,000 1,503,000

Growth (%) -6.72% 11.52% 7.64% 9.70% 10.39% 11.07% 11.75% 10.10% Domestic box office 685,000 620,000 688,000 735,000 802,000 880,000 972,000 1,080,000

Growth (%) -9.49% 10.97% 6.83% 9.12% 9.73% 10.45% 11.11% 9.40% *P=Projected (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) The Bombay

106

territory (i.e. Mumbai, Thane, Western Maharashtra and Gujarat) is the largest contributor to the domestic theatrical revenue of Hindi films, followed by Delhi and Uttar Pradesh and Punjab (Punjab, Haryana, Jammu and Kashmir and Himachal Pradesh). The following chart illustrates the contributions of various territories to the domestic theatrical revenue of Hindi films:

(Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2010”) A recent change in the domestic theatrical exhibition segment is the emergence and growth of multiplexes. Multiplex contribution has increased to approximately 25.00% of the total domestic theatrical revenues for the overall Indian film industry in 2009 and as much as 60.00% for Hindi films. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2010”) Further, many single-screen and stand-alone cinema theatres are being converted into multi-screen cinema theatres and multiplexes. A number of single screen and stand-alone cinema theatres have been acquired on lease for refurbishment or renovation or conversion to multiplexes. Such refurbishment or renovation and conversion to a multiplex has resulted in higher occupancy rates and consequently, higher box office collections. In addition to the increase in admits in Indian multiplexes, the ATPs and food and beverage spending per admit in India are likely to increase in line with the trends prevailing in the developed markets, which will be beneficial to Indian multiplexes. The growth of multiplexes in India is being driven by a variety of factors. We believe that cinema theatre patrons often prefer multiplexes over single-screen cinema theatres as multiplexes function as comprehensive entertainment platforms with cinema theatres, gaming parlours and food courts, thus catering to a wider range of leisure time requirements. Further, we believe that the growing popularity of Hollywood films among Indian viewers is also driving the growth of multiplexes in India as cinema theaters patrons typically prefer to watch Hollywood films in multiplexes or refurbished cinema theatres. Film producers often prefer large multiplex chains as channel partners as multiplex chains enable them to release a film on a pan-India basis. Multiplexes are also instrumental in developing a separate class of audiences in large Indian cities for niche and off-beat films. Another important trend in the theatrical segment in India is the emergence of digital technology as a preferred medium for the exhibition of films over analogue technology. The rising number of cinema theatres and multiplexes in India equipped with digital projection technology provides the film industry with a larger number of release centres for the distribution of their films. While prior to the increased penetration of digital projection technology, a film was typically released in approximately 250 centres, films are now typically released in 700 to 800 centres due to lower costs and improved logistics. The number of screens equipped

107

with digital projection technology is expected to increase significantly as producers and distributors utilise more screens equipped with digital projection technology to ensure a wider release of their films, reduce print costs and combat piracy. Digital projection technology also provides theatrical exhibitors with the opportunity to receive additional revenues through alternative content offerings such as sporting events and award shows. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2010”) In India, multiplex penetration (admits as a percentage of population) is quite low compared to the penetration in more developed countries as shown in the following table. However, multiplex penetration and SPH are expected to grow in line with overseas trends and the gap is expected to decrease as the propensity to spend increases across the Indian populace as a result of increasing disposable incomes.

3043 45 46 52 53

61

77

117

12

0

20

40

60

80

100

120

140

UK

Bel

gium

Ger

man

y

Spai

n

Ital

y

Irel

and

Den

mar

k

Fran

ce US

Indi

a

(Source: KPMG and CII, “Indian entertainment industry Focus 2010: Dreams to reality”) Overseas Theatrical The demand for Indian films among the Indian population in the United States, UK and the Far East region is growing. This is demonstrated by the contribution of overseas theatrical revenues in the total revenue of the Indian film industry. The revenue from overseas theatrical exhibition is expected to grow from `69,000.00 lakhs in 2011 to `115,000.00 lakhs in 2016. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) The growing popularity of Indian films in overseas market has opened new opportunities for Indian exhibitors. Typically, cinema chains in the United States show very few foreign films, including Indian films. This has created an opportunity for Indian exhibitors to establish cinema theatres in the United States for exhibiting Indian films to the local Indian population. In addition, Indian film distributors may access a unique distribution opportunity in exhibiting their films through Indian cinema chains instead of United States cinema chains, as United States cinema chains often exhibit Indian films in smaller cinema theatres, which causes poor customer experience that results in lower box office collections. Further, smaller cinema theatres in the United States that exhibit Indian films typically deal with Indian film distributors by giving a minimum guarantee and a percentage share of the overflow, which results in substantial under-reporting of revenues. Television Television has played a dominant role in the Indian E&M industry, with a size of `3,290,000.00 lakhs and believed to be approximately 1,460 lakhs television households in 2011. Household penetration of cable and satellite television has increased to approximately 80.0% in the year 2011 from approximately 50.0% in the financial year 2006. The number of television channels in India has increased from 120 in 2003 to more than 623 in 2011. While general entertainment channels (“GECs”) in Hindi and regional languages still garner a

108

greater share of TV viewership, channels which cater to niche audiences are also popular. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) The following chart illustrates the growth in number of cable and satellite (“C&S”) households in India in 2010 to 2016:

(Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”). The following charts illustrate the programming composition of India’s GECs in 2004 and 2008:

(Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2009”) Fictional television programmes remained the dominant genre in the Indian television industry, with films ranking as the second most popular programme type. These fictional offerings have retained their prominence despite the growing popularity of “reality TV” content. In 2008 and 2009, serialised “soaps” occupied the most programming time and received the most viewership. However, viewer preferences have shifted from the popular ‘saas bahu’ programmes in favour of socially relevant and localised or regionalised

109

content. The number of big format programmes has also increased substantially over the last five years. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2010”) The following chart illustrates the size of the Indian television industry for the years 2006 through 2016:

P = Projected (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2010”) The strength of the Indian economy and the increasing popularity of new distribution platforms such as digital distribution are expected to propel the growth of the Indian television industry. Animation and VFX India’s animation and VFX industry was approximately `310,000.00 lakhs in 2011 and is expected to grow at a CAGR of 17.0 % to reach approximately `690,000.00 lakhs in 2016. The Indian animation and VFX industry is driven by the increased consumption of animated content, creation of global intellectual property formats, acceptance of 3D graphics and the spread of the industry to international markets. The use of VFX in live-action films has grown significantly in recent years. Many live action films in India now include special effects sequences and the duration of these sequences is estimated to have grown by nearly 40.0% percent over 2008. The growing demand and capability of Indian studios to produce high quality VFX content has helped Indian studios establish their presence in overseas markets. Overseas presence enables Indian studios to create integrated production systems and generate robust pipelines of projects through their global networks. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) The following chart illustrates the size of the animation and VFX industry in India for the years 2008 through 2011:

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(Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) The VFX industry in India is in an early stage of development and has the potential to grow into a significantly larger industry. The use of VFX has been an integral part of many Hollywood films, with 8 out of the 10 top grossing Hollywood films in 2011 featuring significant VFX sequences. The Indian film industry is increasingly producing storylines and films oriented around the use of VFX. With due increases in the capabilities of Indian VFX studios and competitive pricing, VFX is expected to become one of the top outsourcing sectors in India. (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”) Unlike in India, the VFX industry in overseas markets has matured. However, the Indian VFX industry is undergoing a series of changes in order to provide better quality service to viewers such as offering services on alternative platforms such as television, Internet and mobile applications and offering high-definition content, image up-scaling, conversion from 2D to 3D and CGI. The following table provides the estimated cost of production of 30 minutes of animated content in India, Korea/Philippines and North America:

(Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2012”)

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BUSINESS

Overview We are one of India’s leading entertainment and media (“E&M”) companies with a presence across several businesses such as theatrical exhibition of films, film and media services and television content production and distribution. Our headquarters are located in Mumbai and we have operations across 78 cities and towns in India and internationally, in Nepal, Malaysia, the UK and the United States. Our theatrical exhibition business is our largest source of revenue. We operate one of India’s largest cinema chains, under the brand ‘BIG Cinemas’, with 262 screens in India and an additional 230 screens in Nepal, Malaysia and the United States as of June 30, 2012. During the 12 months ended March 31, 2012, BIG Cinemas catered to approximately 338 lakhs and 57 lakhs consumers in India and overseas, respectively. Our film and media services business comprising production, post-production services and creative services for films and television is our second largest source of revenue, which comprises: Production services: We lease sound stages, shooting floors, standard and high definition multi-

camera equipment and other related equipment to television and film production companies.

Post-production services: We process film negatives at our laboratories located in Mumbai, Chennai, Kolkata and London and trade film negatives in India. Our 4K DI laboratory located in Film City, Mumbai undertakes quality enhancement of film and television content through digital techniques.

Creative Services: We are also engaged in the film restoration business through our subsidiary, Digital Media Imaging Limited. We also provide creative services such as VFX, conversion of 2D content to 3D and CGI. In addition, our subsidiaries located in United States and UK, Lowry Digital and Reliance MediaWorks (UK) Limited, respectively, are engaged in the business of digital image correction, film restoration and film processing.

We operate our film post production services through production laboratories in Mumbai, Chennai, Kolkata and London and our creative services through facilities in Burbank (United States), London (U.K) and Navi Mumbai (India). Films processed at our laboratory in Mumbai have won, among others, 14 national awards for cinematography and our Company’s film processing facilities have been certified by Kodak Imagecare, an internationally recognised quality certification program, for each of the years beginning 2005. We were among four companies to receive the “Judges Award for Creativity & Innovation in Post-Production” at the Hollywood Post Alliance Awards in 2010. In August 2011, our Company received a patent for an innovation – “System and method for removing semi-transparent artifacts from digital images caused by contaminants in the camera’s optical path”. Our Company was the first Indian company to be recognized in the category of science and technology for the development of an unique and efficient system for the reduction of noise and other artefacts which provides a high quality image required for the film making process at the Academy of Motion Pictures, Arts & Science Awards 2012. As a part of our long term growth strategy of asset creation, during the previous four years, we have established:

a business process outsourcing (BPO) facility at Navi Mumbai; post-production facilities for television commercials and broadcast; and a DI Lab.

Further, we have purchased broadcast and film cameras. We have also increased the number of screens we operate. This has been achieved organically and has enhanced our reach in terms of exhibition business and also enabled us to strengthen our capabilities in post-production services and creative services divisions.

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We are also in the process of establishing an approximately 2,00,000 square feet film studio located in Film City, Mumbai with facilities for shooting films, television shows and television commercials, which we believe meets international standards. This studio aims to provide a one-stop solution for all production needs for domestic and international clients. When completed, the studio is expected to have eight sound stages with appropriate noise control and other features. A part of the film studio constituting three sound stages was completed in January 2011. We expect to complete the remaining portion of the film studio by March 2013. We are also engaged in the business of television content production under the brand “BIG Synergy”, which primarily produces non-fiction programmes in addition to adapting international programme formats for Indian viewers. We have produced shows such as Kaun Banega Crorepati, Kya Aap Paanchvi Paas Se Tez Hai, Duss Ka Dum, India’s Got Talent, Aap Ki Kachehri - Kiran Bedi Ke Sath and Sach Ka Saamna. We also selectively distribute films. For the 12 months ended March 31, 2012 and Fiscal 2011, our restated consolidated net loss after tax was `57,216.63 lakhs and `32,796.95 lakhs, respectively. For the 12 months ended March 31, 2012 and Fiscal 2011, our consolidated total income was `83,472.70 lakhs and `85,026.20 lakhs, respectively.

Our Competitive Strengths We believe the following are our key competitive strengths: Strong reputation and brand in the E&M sector We believe that we have established ourselves as having a strong reputation and brand in the E&M sector. We have rebranded our theatrical exhibition and our television content production businesses as “BIG Cinemas” and “BIG Synergy”, respectively. This rebranding was undertaken in order to create a single E&M brand, “BIG”. During the 12 months ended March 31, 2012, BIG Cinemas catered to approximately 338 lakhs and 57 lakhs consumers in India and overseas, respectively. We have received various awards for our theatrical exhibition business, including “Most Admired Innovative Concept of the Year” at the Images Retail Forum 2010 for our Ciné Diner theatre exhibition concept, which was also placed second at the Interior & Architecture Design Awards in 2009 in the “Best Interior Design – Hospitality” category. We also received the “Most Admired Retailer in Entertainment” award at the India Retail Awards in 2009, which we also received in 2007. We received the “Exhibitor of the Year” award at the CineAsia 2008 awards and were named “Retailer of the Year” in the “Entertainment” category for the second consecutive year at the India Retail Summit in 2007. The Silent National Anthem campaign launched by Big Cinemas has bagged one silver in the PR Lions category and two bronze lions in Promo & Activation category in 2011. Our BIG Synergy brand, under which we produce television content, has produced television shows such as Kaun Banega Crorepati, Kya Aap Paanchvi Paas Se Tez Hai, Duss Ka Dum, India’s Got Talent, Aap Ki Kachehri - Kiran Bedi Ke Sath and Sach Ka Saamna. Many of these shows received high viewer ratings and have occupied leadership positions among their programme categories. Additionally, through Lowry Digital, we believe we have one of the leading digital image correction and restoration facilities in the world. Lowry Digital’s clients include industry leaders such as Walt Disney Pictures & Television and Warner Bros. Entertainment Inc. Lowry Digital’s facility has provided image enhancement and restoration services to approximately 500 films as of March 31, 2012 and has worked on classics such as Casablanca, Singin’ in the Rain, Sunset Boulevard and a number of Walt Disney Pictures & Television classics such as Cinderella, Bambi, George of the Jungle, Snow White, Fantasia, Tron, Tangled, Winnie the Pooh, Beauty and the Beast and 101 Dalmatians. We believe in partnering with leading media companies in Hollywood to establish our foothold in the post production services space. We believe that our relationship with Digital Domain, an Academy Award-winning digital production studio in Hollywood, for outsourcing work on VFX and Conversion in India and UK demonstrates our quality and efficient workflow processes as well as strong brand repute.

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We believe that our longstanding presence in the film processing business has made us one of the important operators in the Hindi film category in addition to being a key operator in certain regional language films. Films processed at our laboratory located in Mumbai have won, among others, 14 national awards for cinematography and its film processing facilities have been certified by Kodak Imagecare, an internationally recognised quality certification program, for each of the years beginning 2005. We believe we have established a strong reputation and brand through the quality of our products and services which have obtained industry recognition and customer satisfaction. We believe that our strong reputation and brand differentiates us from our competitors. Demonstrated ability to expand our operations both organically and inorganically We have created a global E&M company that is capable of operating across the entire E&M business value chain. Since the Reliance Group acquired control of our Company in the financial year 2006, we have grown and diversified our business. Our revenues have grown from `13,111.95 lakhs for the financial year 2006 to approximately `83,472.70 lakhs for the 12 months ended March 31, 2012. Currently, we have diversified service offering across several businesses, such as theatrical exhibition of films, film and media services and television and content production and distribution. Our theatrical exhibition business has expanded from 32 screens across five cities as of March 31, 2006 to 492 screens across more than 110 towns and cities in India, Nepal, Malaysia and the United States as of June 30, 2012. Our employee base, comprising of professionals with more than 10 years of experience has grown significantly from 14 employees in the financial year 2006 to 121 employees till March 31, 2012. As part of our ongoing strategy to expand our theatrical exhibition business, we have adopted a price differentiation model, which we believe has increased our patronage by offering our patrons an enhanced cinema experience at each price point. Most of our cinema theatres are located in highly populated areas providing convenient access to our target customers, which are upper-income and middle-income households. From a customer base of approximately 129 lakhs consumers in India for the financial year 2008, BIG Cinema has grown to approximately 395 lakhs consumers across India and overseas for the 12 months ended March 31, 2012. Through our television content production brand, “BIG Synergy”, we have demonstrated our ability to produce highly popular programmes such as Kaun Banega Crorepati and Duss Ka Dum including adapting international programme formats for Indian viewers. We have also demonstrated our ability to acquire companies located in India and overseas in order to consolidate our position as a company that is capable of operating across the entire E&M business value chain. For example, we have acquired Rave Entertainment Private Limited (“Rave”), Synergy Communications Private Limited (now, Big Synergy Media Limited), iLab and Lowry Digital between the financial years 2007 and 2009. Acquisition of Rave helped us in establish our footprint in the North Indian cinema territories, while Synergy Communications Private Limited has facilitated our entry into the business of television content production and Lowry and iLab have helped us establish our presence in the North American and European markets, offering us new business opportunities such as image processing and restoration, 2D to 3D conversion and VFX. Presence across Various E&M Businesses and Geographies We believe we are a one-stop solution provider for film and television producers and distributors in India. We provide the entire range of film services, including film studio rental, film equipment rental, DI post-production laboratory services, film processing, digital cinema mastering and operating cinema theatres in various countries. Our presence across various businesses allow us to develop long-term relationships as we are able to cross-sell our various services and offer solutions for the varying requirements of our customers. Our strategy is to create a single global E&M company that is capable of operating in geographically diverse markets and catering to a variety of consumers. We have expanded our operations by acquiring theatrical exhibition assets overseas and we own and operate 262 screens in India and 230 screens in Malaysia, Nepal and the United States as of June 30, 2012. We have also established a presence in the film post-production services business in the United States and the UK through the acquisition of Lowry Digital and iLab,

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respectively. We believe that our multinational presence makes us an attractive proposition for our customers. Our technological capabilities We have attempted to develop or acquire the latest technological capabilities across our business lines to ensure that we remain competitive. In our film production services business, we utilise various sophisticated technologies, including digital camera technology capable of recording high-definition video, sync-sound enabled studio stages and fibre optic cables for the distribution of films. Our film processing laboratory, through its telecine scanners, enables us to capture the fine details of a filmed image. We are capable of grading the film in an uncompressed 4K resolution, the highest available resolution for film production. We utilise proprietary image processing technology to deliver superior picture elements and have developed a unique technology, the “Lowry Process”, which is used to create high image quality for all outputs, including film, broadcast television, advertisements, digital cinema, Blu-Ray Disc and Internet video. Lowry Digital’s services include film restoration, emergency image repair, digital blow-ups and DI enhancements. Lowry Digital also offers image enhancement tools which are used for the restoration and upgrade of damaged analogue film prints. We were among four companies to receive the Creativity and Innovation Hollywood Post Alliance Award in November 2010. In August 2011, our Company received a patent for the following innovation – “System and method for removing semi-transparent artifacts from digital images caused by contaminants in the camera’s optical path”. Our Company was the first Indian company to be recognized in the category of science and technology for the development of an unique and efficient system for the reduction of noise and other artefacts which provide a high quality image required for the film making process at the Academy of Motion Pictures, Arts & Science Awards 2012. We also introduced the 6D multi-sensory cinema experience in India in 2008. We introduced the IMAX digital projection system in India in 2001, which has enabled us to take advantage of the increasing number of IMAX and IMAX 3D releases. Some of our cinema theatres feature digital cinema projectors that, in addition to displaying films, are also capable of displaying digital 3D images and non-film content such as opera and cricket matches. The Reliance Group’s brand, experience and position in India and overseas The Reliance Group is a diversified business group with a strong brand, level of experience and position in India and overseas. The Reliance Group is headed by Anil Dhirubhai Ambani, one of India’s leading entrepreneurs, who has won several awards such as “Person of Year – 2008” by Light Readings for outstanding achievements in the telecommunications industry and “Businessman of the Year” in a poll conducted by The Times of India in 2006. Reliance Communications Limited, one of the leading wireless carriers in India in terms of coverage and capacity and Reliance Capital Limited, one of the leading private sector financial services companies in India are part of the Reliance Group. The Reliance Group also includes Reliance Power Limited, one of India’s leading power development companies. The Reliance Group has a large presence in the entertainment, communications and infrastructure sectors and we derive significant benefits from our association with the group. For example, we are able to derive benefits of synergy in approaching advertisers through our relationship with Reliance Broadcast Network Limited, a group company which owns 92.7 Big FM, one of India's leading radio networks, and BIG Street, an out-of-home media business. We believe that we will continue to benefit from the depth of experience of the Reliance Group and our association with the Reliance Group significantly enhances our brand value. Our Business Strategy Our business strategy is to build upon our competitive strengths and business opportunities to continue to be a leading E&M company. Our business strategy consists of the following principal elements:

Continue to focus on increasing our revenue from film and media services

While we continue to focus on film and media services, we intend to expand our service offerings in line with technological developments and market demand. For instance, we commenced production services business with equipment rental and have extended our service bouquet by building a state-of-the-art film

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studio in Film City, Mumbai, comprising of three film studios with eight sound stages, which we believe will significantly strengthen our ability to provide film production services. While a part of the film studio constituting three sound stages was recently completed, we expect to complete the remaining portion of the film studio by March 2013. We have also extended our BPO offerings from restoration and content processing to VFX, 2D to 3D conversion and CGI.

Create lean front-end centers in overseas markets and substantial back-end delivery centres in India for film and media services Hollywood produces maximum number of high budget films with high expenditure on VFX and 3D conversions. However, the cost of production in US is almost four times as compared to India (Source: Federation of Indian Chambers of Commerce and Industry and KPMG, “Indian Media & Entertainment Industry Report 2009”). We have identified this opportunity and mapped the demand with supply. We have created strategic front-ends in the markets of US (Burbank) and UK (London), complimented by back-end delivery centres in India, one of which is located in a SEZ. The front-end centers in US and UK focus on business development and hence are lean on assets. We intend to continue to focus on further enhancement of strategic front-end tie-ups backed by increasing back-end asset creation in India, where our main delivery centres are located. Opportunistically expand our theatrical exhibition business

The key elements of our growth strategy for our domestic theatrical exhibition business include the following:

Focussing on select metro and tier 1 cities which we believe could potentially have a higher consumption pattern; and

Expanding in certain select locations to establish a footprint or to strengthen our presence in identified film territories.

A retail centric approach, to enhance the profitability of our theatrical exhibition business

Our key focus in improving the profitability of our theatres is through increasing patronage and improving the overall customer experience, which we believe will lead to greater spending by customers, allow us to command greater premiums in our ticket prices and increase advertising revenues. We seek to achieve this through the following:

Enhancing our understanding of our customer to enable us to customise our programme selection. Further, we propose to introduce movie and time specific pricing to increase admits and, consequently, box office collections;

Offering the customer a wider F&B choice and providing the customer greater access to F&B option in-theatre i.e. within the precincts of the auditorium;

Augmenting our advertising sales by better utilising the available on-screen and off-screen space;

Delivering consistent customer experience, in line with our proposition of delivering an affordable luxury experience to larger pool of customers, whilst keeping a tight control on costs; and

Exploring avenues for rent rationalisation, in the context of the changing market environment.

Grow our business through internal restructuring We would continue to evaluate various opportunities for the growth of our business. In order to garner further investments with an aim to raise fresh capital for the growth of our business, we are considering restructuring certain of our business divisions i.e. film and media services business and exhibition business,

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including by transferring them to our subsidiaries. We may also consider options for entering into technical and financial collaboration with strategic partners either directly or through our subsidiaries. For further details, please see the chapter entitled “History and Certain Corporate Matters” at page 132. Continue to pursue strategic acquisitions and alliances We have expanded our operations by identifying and carrying out strategic acquisitions / alliances. The goals that we hope to achieve through such strategic acquisitions/alliances include: the expansion and enhancement of our businesses; the benefit of technical and operational synergies; and the expansion of our geographical reach.

We intend to continue to evaluate such options even in the future. Our Business Operations Theatrical Exhibition Business We operate one of India’s largest cinema chains under the brand “BIG Cinemas”, with 262 screens in India and 230 screens in Malaysia, Nepal and the United States as of June 30, 2012. We introduced the IMAX digital projection system in India and created properties such as BIG Cinemas R City, IMAX Big Cinemas and Metro BIG Cinemas in Mumbai and Odeon BIG Cinemas in New Delhi. We also launched India’s first 6D multi-sensory cinema experience at Agra and we believe we were among the first cinema chains to exhibit 3D versions of various international films. The different types of agreements through which we operate our cinema theatres are set forth below: Business conducting agreements: Typically, business conducting agreements are entered into

between our Company, the owners of the cinema theatre premises and persons/entities who hold licenses to operate cinema theatres (“License Holders”). Under business conducting agreements, our Company operates and manages the cinema theatres on a conducting basis on exclusive basis, in consideration of which, our Company pays certain conducting charges to the License Holders. The licenses and approvals required to operate the cinema theatres are acquired and maintained by the License Holders. The term of business conducting agreements ranges from three years to 30 years.

Lease agreements: Lease agreements are entered into between our Company and the owners of the cinema theatre premises. Under lease agreements, our Company obtains a right to occupy, possess and operate various cinema theatres /multiplexes on exclusive basis, in consideration of which, our Company pays rent along with certain additional charges. The licenses and approvals required to operate the cinema theatres are acquired and maintained by our Company. Typically, the term of these lease agreements ranges from 10 years to 20 years.

Management agreements: Management agreements are entered into between our Company and the owners of the cinema theatre premises. Under management agreements, our Company manages operations for the cinema theatres, in consideration of which, our Company receives a monthly management fee. Typically, the term of these management agreements ranges from three years to 10 years.

With the exception of the multiplexes situated at Mulund, Mumbai and in Kalyani Nagar, Pune which are owned by us and the multiplexes situated at Wadala, Mumbai which is owned by us through a perpetual lease, and Trimurti Chowk, Nashik which is owned by us through a lease of 90 years, we operate all of our cinema theatres through lease arrangements, business conducting agreements or through management agreements. Our cinema theatres are equipped with various types of sound systems such as Dolby Digital (5.1, EX and 7.1) and DTS, comfortable seating and other customer-friendly amenities such as Mobile Box Office, mobile phone ticket purchasing application, ticketing through “Print@Home” at select locations and “Easyticket”, a virtual pre-paid card that may be used to purchase tickets.

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The number of our cinema theatres and screens are as follows:

As of March 31 Number of Cinema Theatres

Number of Screens in Our Cinema Theatres

2006 8 32 2007 15 57 2008 54 147 2009 115 429 2010 140 508 2011 146 543 2012 141 519

We operate 133 cinema theatres with 492 screens across India, Nepal, Malaysia and the United States as of June 30, 2012. India In India, BIG Cinemas is located in 14 states and union territories with 100 properties and 262 screens as of June 30, 2012. The number of our cinema theatres and screens in the states and union territories of India as of March 31, 2012 were as follows:

State / Union Territory Number of Cinema Theatres

Number of Screens

Maharashtra 29 95 Uttar Pradesh 17 41 Gujarat 12 32 Tamil Nadu 10 18 Rajasthan 6 9 Andhra Pradesh 7 15 Punjab 6 19 Karnataka 2 6 Madhya Pradesh 5 14 Chhattisgarh 2 3 West Bengal 1 3 Haryana 1 3 Puducherry (Union Territory) 1 2 New Delhi (Union Territory) 1 2 Total 100 262 The following map illustrates our theatrical exhibition presence across 78 cities in India as on March 31, 2012:

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The following table provides certain details of admits, ATP and SPH that illustrate the growth our theatrical business in India over the last two financial years on same store basis:

Particulars 12 months ended Tier 1 Cities Tier 2 Cities Tier 3 Cities

Admits (lakhs) March 31, 2011 107.1 55.1 86.6 March 31, 2012 124.4 61.5 98.0

% increase 16.14% 11.64% 13.26%

ATP (`) March 31, 2011 150 94 64 March 31, 2012 161 95 69

% increase 7.50% 1.13% 7.50%

SPH (`) March 31, 2011 41 27 19 March 31, 2012 42 30 20

% increase 0.63% 11.88% 5.22%

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Alliance with UFO Moviez We have entered into a memorandum of understanding dated March 23, 2010 (“UFO MOU”) with UFO Moviez India Limited (“UFO”) to deploy UFO’s digital projection equipment in our cinema theatres, with UFO having a right of refusal in this regard. UFO has also agreed to install encoding equipment at our offices and provide personnel for management of such equipment and redirect the producers and directors approaching it for digital encryption to us. We also intend to create a separate division for providing programming services to cinemas equipped with UFO equipment. Further to the UFO MOU, we have entered into an agreement for equipment lease dated May 14, 2010 (“UFO Agreement”), pursuant to which UFO has deployed digital cinema equipment on lease basis at our 67 screens in India. Such digital cinema equipments shall be exclusively for the purpose of exhibition of the content provided by UFO in the relevant 67 screens. During the term of the UFO Agreement, we have agreed to accord UFO the sole and exclusive right to install non-digital cinema initiative (DCI) compliant digital cinema equipment and deliver film content through any digital mode to the relevant screens. In terms of the UFO Agreement UFO shall be entitled to uninstall and remove the equipment after giving seven days’ notice in the event the digital cinema equipment is kept unused for an uninterrupted period of 3 months. Our association with UFO Moviez has enabled us to increase our reach significantly. For example, for the film 3 Idiots, distributed by Reliance Big Entertainment Private Limited, the tie-up with UFO Moviez enabled us to expand our reach in key film territories as shown below:

Circuit % of All-India Box Office Collections

BIG Cinemas Box Office Collections

UFO Box Office Collections

Total Box Office Collections

Bombay 39% 13% 10% 23% Delhi and Uttar Pradesh

19% 13% 5% 18%

East Punjab 8% 5% 16% 21% Rajasthan 5% 10% 20% 29% Central Provinces

4% 21% 26% 47%

Central India 3% 7% 26% 33% The United States We have 173 screens located across the United States as of June 30, 2012. We have 23 cinema theatres located in the states of New Jersey, New York, Virginia, California, Florida, Illinois, Georgia, Maryland, Tennessee, Kansas, Alabama, Nevada, Ohio and Kentucky. In addition to exhibiting films in the Hindi, Tamil and Telugu languages, we also exhibit English-language Hollywood films. We operate the leased cinema theatres under the brand name “Big Cinemas”. The following map illustrates our presence across the United States as of March 31, 2012:

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The following table listing certain box office contribution of recent Indian films in the United States demonstrates the popularity of our cinema theatres as a viewing destination for the Indian diaspora:

Film Market Share of Box Office Collections*

Total Number of Prints Released

Total Number of Prints Released by

BIG Cinemas Singham 32% 45 8 Body Guard 22% 78 9 Teen Maar (Telugu) 62% 32 9

*(Source: www.boxofficeessential.com) Malaysia In Malaysia, we have 54 screens in Kuala Lumpur and the states of Selangor, Johor, Pahang, Perak and Kedah. Our Theatrical Exhibition Business Model Our revenues are primarily generated from the following: patronage and patron spending, which entails revenues generated from ticket sales, food and

beverage sales, gaming and parking; advertising revenue; business conducting fees; and management fees.

The yearly details of our patron admissions for our cinema theatres globally are as follows:

Period Patron Admissions (lakhs) For the 12 months ended March 31, 2012 395 Financial Year 2011 359

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Financial Year 2010 331 Financial Year 2009 258 Financial Year 2008 126 We have adopted a price differentiation model which we believe has increased our appeal to consumers by offering our patrons an enhanced cinema-going experience at each price point. Our ATPs for our single / twin screen cinema theatres as compared to our multiplexes may vary. We provide our patrons with a wide variety of food and beverage options which we believe enhances their cinema-going experience. The food and beverage offerings are primarily in the nature of fast food. The exhibition of a film in one of our cinema theatres offers advertisers an opportunity to command the attention of a large, captive audience and our pan-India presence is an attractive feature for such advertisers. Advertising opportunities in a cinema theatre include space selling, on-screen and off-screen promotions and event sponsorship. We have entered into advertising agreements with several reputed companies, including HDFC Limited, ITC Limited and Reliance Communications Limited. Film and Media Services The film and media services business is our second largest source of revenue and has been operational for approximately two decades. We have expanded our portfolio of film production services to provide post-production and grading with our 4K DI laboratory and our digital cinema mastering facility. Our film production and post-production services operations in India are located in Mumbai, Chennai and Kolkata. In Mumbai, we provide a wide range of services, whereas in Chennai and Kolkata we simply provide film processing services. We are also engaged in the film restoration business through our subsidiary, Digital Media Imaging Limited. We also provide creative services such as VFX, conversion of 2D content to 3D and CGI. In addition, our subsidiaries located in United States and UK, Lowry Digital and Reliance MediaWorks (UK) Limited, respectively, are engaged in the business of digital image correction, film restoration and film processing. The following chart illustrates our presence across the E&M industry value chain:

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Film Processing Business During the 12 months ended March 31, 2012, our film processing business serviced approximately 196 clients. For the said period, we provided film processing services for 175 films and developed approximately 20,922 analogue prints. We have established facilities that offer a variety of film negative services, including, film negatives processing, colour correction, editing and the production of final prints for distribution. We also supply film negatives to film producers. We have received national Indian awards for best cinematography for 14 films including, Salim Langde Pe Mat Ro in 1990, Suchitra Mitra in 1993, Tarana in 1996, Hum Dil De Chuke Sanam in 2000, Rasikapriya in 2001, Girni and Swades in 2005, Parsi Wada and Tarapore – Present Day in 2006, Yatra in 2008, Kramash and 3 Idiots in 2009 and Kutty Srank and Gaarud in 2010, Anhe Ghorey Da Daan in 2011. In addition, our processing laboratory in Chennai received the South Indian Cinematographers’ Association award for “Best Colour Laboratory” in 2007. The customer base for our film processing business includes the following film companies:

Filmmakers Film Red Chillies Entertainment Private Limited

Om Shanti Om, Main Hoo Na, Billu, Ra. One, Always Kabhi Kabhi

Studio 18 / Block Buster Movie Entertainers

Singh Is King, Namastey London, Shaitan

Ashutosh Gowariker Productions Private Limited

Jodhaa Akbar

UTV Software Communications Limited Dev D, Fashion, Welcome To Sajjanpur, Mumbai Meri Jaan, Race, Taare Zameen Par, The Blue Umbrella, The Namesake, Aamir, Chup Chup Ke, Khosla Ka Ghosla, The Happening, Chance Pe Dance, Udaan, Raajneeti, Thank You

Vinod Chopra Films Private Limited Munnabhai M.B.B.S., Parineeta, Eklavya, Lage Raho Munna Bhai, 3 Idiots

Rakeysh Omprakash Mehra Productions Delhi-6, Teen Thay Bhai Rajshri Productions Private Limited Vivah, Dulhan Wahi Jo Piya Man Bhaye, Tarana, Ek Vivaah . . .

Aisa Bhi, Love U Mr. Kalakaar Arbaaz Khan Productions Dabangg Shree Ashtavinayak Cine Vision Limited Maharathi, Jab We Met, Superstar, Bhagam Bhag, Golmaal,

Golmaal Returns, Kidnap, Khatta Meetha, Rockstar Mukta Arts Limited 36 China Town, Apna Sapna Money Money, Black & White,

Good Boy Bad Boy, Sanai Choughade, Bombay to Bangkok, Khanna & Iyer, Shaadi Se Pehle, Valu-The Bull, Yuvvraj, Hello Darling

Tips Industries Limited Kismat Konnection, Naqaab, Race, Dil Apna Punjabi, Prince, Tere Naal Love Ho Gaya

Nadiadwala Grandson Entertainment Private Limited

Jaan-E-Mann, Heyy Babyy, Housefull, House Full -2

B.R.Films Private Limited Bhootnath, Videsh, Water, Baabul Dharma Productions I Hate Luv Storys, We Are Family, Agneepath, Ek Main Aur Ekk

Tu Balaji Motion Pictures Limited Once Upon a Time in Mumbai , Ragini MMS, The Dirty Picture Reliance Big Entertainment Private Limited

Kites, Raavan, Singham, Real Steel, Cowboys & Aliens

Yash Raj Films Private Limited Rocket Singh, Badmaash Company, Lafangey Parindey, Mere Brother Ki Dulhan, Ladies V/S Ricky Bahl

Eros Entertainment Aladin, Anjana Anjani, Veer

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Function of a Film Processing Laboratory A film processing laboratory is an integral component of the film production to exhibition value chain. Raw film is created during the production of a film and cannot be exhibited in such form until it undergoes a number of processes to render it fit for viewing, which are provided by a film processing laboratory. The laboratory aligns the film, performs sound correction and edits the film, which results in the creation of a final print. The final print is then previewed in a preview theatre as a quality check. Distributors, the last link in the value chain, market and distribute a film after acquiring distribution rights from the film producers of the film and ordering prints from the film processing lab. Film Processing Business The primary services of our film processing business are colour negatives processing, colour positives processing, film printing, photo guard coating and ultrasonic film cleaning. The processes involved for performing these services are detailed as follows: Stage I The exposed set of film negatives received from a studio or film shoot location is processed at our laboratory in accordance with the picture negatives reports or camera logs prepared by the camera assistant for the camera operator or director. After the film is developed, it is inspected in accordance with the camera log and divided into sections according to the scenes and takes filmed. These sections are then joined together into rolls, which are examined by the grading operator along with instructions received from the director to determine how they will be printed. When the characteristics have been decided and recorded, a positive print is made from the assembled rolls and processed through the developing machine. These prints are known as the “daily rush prints”. Stage II The negatives then undergo post-production processes, such as editing and sound synchronisation, in order to produce the first film print. The laboratory then assembles the final picture and tracks the negatives to match the editor’s work print so that the newly created print may be sent for approval to the film production company. Stage III A potential release print is ready for release when printing characteristics for both picture and sound have been standardised such that the required number of copies of may be produced in consistency with the approved print. We utilise a preview theatre featuring Dolby Digital Surround EX and DTS sound systems to carry out a final inspection of the films processed at the laboratory, in addition to analysing films with densitometers and film analysers. We utilise two diesel generators with a total capacity of 510 kVA as a backup power supply for our critical chemical processing activities. DI Laboratory Business We have set up a 4K DI laboratory that converts traditional analogue films to digital formats and features real-time grading capabilities. Its integrated client services include telecine, digital optics, promotional packaging, conversion, scanning, high definition recording and subtitling. Films serviced by our DI laboratory include, among others, Rockstar, Singam, RA- One, Zindagi Milegi Na Dobara, Robot, 3 Idiots, I Hate Luv Storys, Kites, We Are Family, Ravaan, Once Upon a Time in Mumbai, Singh is King, Sarkar Raj, Delhi-6, Yuvvraaj. Digital Cinema Services Business Our digital cinema services business is one of India’s leading DCI grade digital cinema services. Our services include: digital content mastering;

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global fibre optic distribution; digital cinema theatre equipment installation; and digital cinema theatre equipment maintenance.

Our secure digital cinema services facility located in Film City, Mumbai is connected to our digital processing labs on the same premises and offers film producers and distributors the ability to have their finished film delivered in both 35 mm and digital formats. We have introduced fibre optic distribution of films from India to the United States, with our first commercial distribution being Ghajini in 2008. We have successfully transmitted several films over our fibre optic network to the United States. The fibre optic network entails robust security features as well as flexibility, timing and pricing advantages. Film and Broadcast Equipment Rental Business Our film and broadcast equipment rental business rents standard and high definition cameras with assorted lenses and related equipment as well as providing solutions and expertise through our technical advisory team. We have been associated with 26 programmes on general entertainment channels in India and 67 televised events commencing from during the 12 months ended March 31, 2012. During the said period, we have also rented out film equipment for 42 films and 458 advertising films. The following table lists some of the television programmes, event and films associated with our film equipment rental business:

Television Programmes

Events Films

Kaun Banega Crorepati

Filmfare Awards Dabangg (Arbaaz Khan Productions)

Bigg Boss Femina Miss India Rajneeti (Prakash Jha Productions) Jhalak Dikhla Ja Mirchi Awards Heroine (Bhandarkar entertainment) Nach Baliye Star Parivaar Awards Burfi ( Eshana Films) India's Got Talent Star Screen Awards Bol Bachchan ( Shree ashtavinayak Films) Pati Patni Aur Woh Standard Chartered Mumbai

Marathon Rowdy Rathore ( SLB Films)

Rakhi Ka Swayamvar Airtel Delhi Marathon Ra – One (Red Chillies Entertainment) Rahul Dulhaniya Le Jayega

Sunfeast Bangalore Marathon Body Guard (The Reel Life Productions Pvt Ltd)

Duss Ka Dum Economic Times Awards Tees Maar Khan (Three's Company Productions) Sacch Ka Samna Brand Equity Awards The Dirty Picture (Vertex Motion Pictures

Pvt.Ltd.) Creative Services We offer a wide range of creative solutions to filmmakers through pre-production, production and post-production stages, including the following: VFX We offer various VFX Solutions, with specialisation in highly complex visual effects, such as concept design, pre-visualisation, “look development”, on-set supervision, 3D animation and CGI, matte painting, compositing and finishing for 2D and 3D stereoscopic feature films and television projects. Our VFX team is supported by a network that connects our VFX studios in Burbank (USA), London (UK) and Navi Mumbai (India). Our alliance with Digital Domain, an Academy-winning digital production studio in Hollywood, for outsourcing work on VFX and Conversion in India and UK demonstrates our superior quality and efficient workflow processes as well as strong brand repute. 2D to 3D Conversion We operate a 2D to 3D conversion facility that combines the technological and artistic abilities present in Hollywood with the skills and large scale image processing capabilities in India. Through this facility, we

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cater to the demand for converting new films shot in standard 2D and older legacy titles proposed to be released in cinemas in stereoscopic 3D. Our facility is based in Navi Mumbai (India) and houses a team of approximately 350 artists who have been trained to develop 3D content. We have made our foray in the domestic markets with Don2. Film Restoration We provide comprehensive solutions for the transfer of analogue content to digital formats. We address the needs of a variety of content owners, such as international film and television studios, television networks, library owners and content distribution companies. We offer services including restoration, encoding, transcoding, compression authoring, format and standards conversion, duplication and dubs, meta tagging, repurposing, editing, versioning, quality control and archiving. We have serviced an order for the digitisation and digital restoration of more than 600 films preserved by the National Films Archive of India. Lowry Digital Lowry Digital, our subsidiary based in Burbank, United States, operates digital restoration facilities. Lowry Digital utilises proprietary image processing technology to deliver superior picture elements and has developed a unique technology, the “Lowry Process”, which is used to create high image quality for all outputs, including film, broadcast television, advertisements, digital cinema, Blu-ray Disc and Internet video. Lowry Digital’s services include film restoration, emergency image repair, digital blow-ups and DI enhancements. Lowry Digital also offers image enhancement tools which are used for restoration and upgrade of damaged analogue film prints. Lowry Digital’s clients include industry leaders such as Walt Disney Pictures & Television and Warner Bros. Entertainment Inc. Lowry Digital’s facility has provided image enhancement and restoration services to approximately 500 films as of March 31, 2011 and has worked on film classics such as Casablanca, Singin’ in the Rain, Sunset Boulevard and a number of Walt Disney Pictures & Television classics such as Cinderella, Bambi, George of the Jungle, Snow White, Fantasia, Tron, Tangled, Winnie the Pooh, Beauty and the Beast and 101 Dalmatians. iLab iLab is a dedicated film and media services facility located in Soho, London, which offers front-end, processing, restoration, 2D to 3D conversion and post-production services to broadcasters and studios. iLab has produced rushes for many high-end films and original drama series for the British Broadcasting Corporation and offers bespoke, specialist rush service for the advertising, feature film and broadcast markets. iLab also offers lab, rushes and transfer services to many Indian films that are shot on location in London and the UK. 3D Solutions We offer integrated stereo services for various 3D alignment issues, image and detail enhancements, grain and noise management and on-set consulting, in addition to our other services for stereoscopic 3D conversion, DI grading for 3D, creation and handling of 3D pictures and 3D camera services. We have performed image and detail enhancements, addressed vertical and horizontal alignments issues and ‘911 emergency services’ for 3D versions of leading titles such as Journey to the Center of the Earth, X Games 3D: The Movie and Step Up. Television Content Production and Film Distribution Our television and film content production and distribution operations comprise of the production of television content which is produced by us and includes related services of financing for the production of films. Film distribution operations comprise of our share of revenue from exploitation and distribution rights acquired by us, which may include as a package, theatrical rights and video and television rights.

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We established BIG Synergy, our brand for television content production, through the acquisition of a majority interest in Synergy Communications Private Limited (now known as Big Synergy Media Limited) in 2007. Big Synergy is one of the key companies in non-fiction programming in India and has enjoyed success in adapting international formats for Indian viewers. Big Synergy was awarded “Best Production House of the Year” at the 2009 Indian Telly Awards. Big Synergy has produced shows such as Quiz Time, India Quiz, Eureka, A Question of Answers, Mum Tum Aur Hum, as well as the adaptation of international formats such as Mastermind, University Challenge, Kamzor Kadi Kaun, India’s Child Genius, Bluffmaster, Heartbeat and Kaun Banega Crorepati which were broadcast on major television channels, including Colors, Star, Sony, Zee, NDTV, Imagine, 9X, Sahara and Kalaignar. Recently, Big Synergy has produced popular shows such as Kya Aap Paanchvi Paas Se Tez Hain, India’s Got Talent, Sach Ka Saamna and Aap Ki Kachehri, Duss Ka Dum and Jhalak Dikhhla Jaa. We also selectively undertake film distribution. Competition Our theatrical exhibition business comprises 262 screens across 100 cinemas and 78 cities in India as of June 30, 2012 and is a combination of single or twin-screen cinemas and multiplexes. We face competition from some organised multiplex chains in large cities. We face competition in the standalone cinema theatre segment from local cinema theatres in Tier 2 Cities and Tier 3 Cities where customers are price sensitive. In our film processing business, we face competition from the local laboratories in southern India, where some regional players are also the producers and distributors for regional films. We have recently set up our 4K DI laboratory and face competition from existing companies. However, the client base that we have established through our processing laboratory has helped us establish ourselves as a key player in this segment. In our television content production business, we primarily create non-fiction content. This is an emerging segment and the competition is restricted to a few players. We also face intense competition in our international operations from various cinema theatre operators. Further, our restoration business faces significant competition in the United States. Employees As of March 31, 2012, we had 2,720 full-time employees and 2,077 workers on contract labour basis. Insurance We maintain a general all-risk insurance cover for all of our cinema theatres including cover for riots, terrorism, fire, burglary and housebreaking, flood and earthquake. We also maintain group medical insurance covering all employees. In addition, we have also purchased a public liability non-industrial risk policy, which has been extended to cover terrorism. Intellectual Property We do not own the trademarks “Reliance MediaWorks” and “BIG Cinemas”. We have entered into a brand licensing agreement (“Brand Licensing Agreement”) with ADAV for the use of the trademarks “Reliance” and the logo on non-exclusive and royalty-free basis for a period of 10 years. In terms of the Brand License Agreement, ADAV may terminate the agreement on various grounds, including (i) our failure to repay debt in the ordinary course of business or when such debt becomes due, (ii) change of control of our Company, (iii) or if we attempt to claim any right of ownership in relation to the aforementioned brand. In consideration of the licensing rights, we shall incur expenditure from time to time in accordance with the directives and guidance of the authorised representatives of ADAV for an amount up to `5,000 lakhs.

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We have entered into a brand license agreement (“Big BLA”) with RBL for the trademark “Big Cinemas” and the logo on a non-exclusive and royalty-free basis for a period of 10 years. RBL may terminate the agreement on various grounds, including (i) our failure to repay debt in ordinary course of business or when such debt becomes due, (ii) change of control of our Company, (iii) or if we attempt to claim any right of ownership in relation to the aforementioned brand. In consideration of the licensing rights, we shall incur expenditure from time to time in accordance with the directives and guidance of the authorised representatives of RBL for an amount up to `5,000 lakhs. Lowry Digital, one of our subsidiaries has obtained US Patent # 7,973,977 B2 issued on July 5, 2011 for ‘System and Method for Removing Semi-Transparent Artifacts from Digital Images caused by Contaminants in the Camera's Optical Path’.

In addition, Lowry Digital has also filed an application with the US Patents and Trademarks Office for a patent for ‘System and Method of Static Pattern Removal from Movies Captured using a Digital CCD Camera’. Our Properties Our registered office is located at Film City Complex, Goregaon (East), Mumbai 400 065, Maharashtra. We have taken our registered office on lease from the Maharashtra Film Stage Cultural Development Corporation Limited pursuant to the lease agreement dated October 21, 1996 for a period of 33 years for a rent payable annually and which is subject to an escalation every five years. We have entered into various lease agreements and conducting agreements for our cinema theatres located in India and overseas and the period of such leases varies across our properties. We have also entered into separate agreements on build, operate and transfer basis for our studios located at Film City, Mumbai for a period of 20 years. Our production laboratories in Mumbai, Chennai, Kolkata and London and a post-production services facility in Burbank, United States have been obtained on lease or leave and license basis.

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REGULATIONS AND POLICIES The following description is a summary of certain sector specific laws and regulations in India, which are applicable to our Company. The information detailed in this section has been obtained from publications available in the public domain. The regulations set out below may not be exhaustive, and are only intended to provide general information to the investors and are neither designed nor intended to substitute for professional legal advice. The Cinematograph Act, 1952 The Cinematograph Act, 1952 (“Cinematograph Act”) was enacted to regulate and certify cinematograph films prior to the exhibition of such films. The Cinematograph Act authorizes the Central Government to constitute a Board of Film Certification in accordance with the Cinematograph (Certification) Rules, 1983 (“Certification Board”) for the purpose of sanctioning films for public exhibition in India. The Cinematograph Film Rules, 1948 The Cinematograph Film Rules, 1948 (“Cinematograph Rules”) require that a license must be obtained prior to storing of any film unless specifically exempted. Any person transporting, storing or handling films must ensure compliance with the provisions of the Cinematograph Rules. The Cinematograph Rules inter alia pertain to precautions against fire, restriction of access to films by unauthorised personnel, supervision of operations, storage of any loose films, minimum specifications for aisle space and exits in storage rooms and electrical installations in the storage rooms. The Cinematograph Rules also specify the form and the procedure for applying for licenses, renewal of licenses, transfer of licenses, refusal to license and cancellation of licenses. The Cine-Workers and Cinema Theatre Workers (Regulation of Employment) Act, 1981 The Cine-Workers and Cinema Theatre Workers (Regulation of Employment) Act, 1981 (“Employment Act”) was enacted with the object of regulating the conditions of employment of workers employed in cinemas and theatres. A producer of a feature film is mandated to enter into an agreement with the workers prior to employing them. Further, the Employment Act enjoins them to register such an agreement with the relevant authority. The Employment Act specifically makes the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, the Payment of Gratuity Act, 1972 applicable to all cinema theatres employing five or more workers. The Employment Act also provides a dispute resolution mechanism in order to address grievances of the workers employed in such theatres or under producers of feature films. The Cine-Workers and Cinema Theatre Workers (Regulation of Employment) Rules, 1984 The Cine-Workers and Cinema Theatre Workers (Regulation of Employment) Rules, 1984 provides the form of the agreement between a cine-worker and a producer of a feature film. The rules also provide the procedure for reference of disputes and conduct of proceedings before a Conciliation Officer of a Tribunal. The Cine-Workers Welfare Fund Act, 1981 The Cine-Workers Welfare Fund Act, 1981 (“Welfare Fund Act”) was enacted with the object of setting up a welfare fund catering to needs of the cine-workers and to promote activities for their welfare. The Welfare Fund Act provides that the Central Government will create a Cine-Workers’ Welfare Fund wherein contributions would be made by way of grants of the Central Government and voluntary contributions, etc. The Welfare Fund Act also provides that the Central Government should apply such funds for the purpose of meeting expenses incurred in carrying out activities for the general welfare of the cine-workers, including providing grants and loans to such workers and to devise schemes for their benefit. The Central Government is also authorised to require producers to furnish statistical data about workers employed under them from time to time. The Cine- Workers Welfare Cess Act, 1981 The Cine- Workers Welfare Cess Act, 1981 (“Cess Act”) provides for the levy and collection of cess on

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feature films for the purposes of the Cine-workers Welfare Fund under the Welfare Fund Act. The Cine-Workers Welfare Cess Rules, 1984 lays down the manner of collection of the duty prescribed in the Cess Act. The Copyright Act, 1957 The Copyright Act, 1957 (“Copyright Act”) covers registration of copyrights of original literary, dramatic, musical and artistic works, cinematographic films and sound recordings. A copyright board has been established under the Copyright Act (“Copyright Board”), which ordinarily hears all proceedings instituted before it. The Copyright Board is deemed to be a civil court and all proceedings before the Copyright Board are deemed to be judicial proceedings as understood under the Code of Criminal Procedure, 1887 and the Indian Penal Code, 1887 respectively. The Copyright Act also envisages that a copyright office shall be established under the immediate control of the registrar of copyrights. In accordance with the Copyright Act, copyright shall subsist during the period of the lifetime of the author and until sixty years thereafter. Licensing and assignment of copyright is permitted in accordance with the provisions of the Copyright Act. Further, copyright societies have been set up for issuing and granting licenses. Infringement of copyright is a civil or criminal offence under the Copyright Act depending on the circumstances. Further, certain police officers above the rank of sub inspector may seize, without warrant, all materials used for infringement. No court inferior to that of a Metropolitan Magistrate or a Judicial Magistrate of the First Class is empowered to try an offence under the Copyright Act. The Copyright Rules, 1958 which sets out the procedure for the enforcement of the Copyright Act was also introduced with the Copyright Act. The Prevention of Food Adulteration Act, 1954 The Prevention of Food Adulteration Act, 1954 (“PF Act”) was enacted to make provisions for prevention of food adulteration. The PF Act restricts a person from selling or distributing any food which is adulterated or misbranded or being sold in contravention of the conditions of the license under which it is to be distributed or sold or any article which has been prohibited from being sold by the Food Health Authority or any other adulterant and enjoins all persons to ensure that the standards as laid down by the Central Committee on food standards from time to time is met. The PF Act empowers the Central and the State Governments to appoint public analysts and food inspectors for the purpose of taking samples of food from outlets selling them and for examining such food. A purchaser or a recognized consumer association may also get any article of food analysed in the manner prescribed. The PF Act also provides that a vendor of food items may be required to disclose the name and other details of any person from whom such food has been purchased. The PF Act outlines the procedure and penalties to be levied in cases of contravention of any of the terms of the PF Act. The Standards of Weights and Measures (Packaged Commodities) Rules, 1977 The Standards of Weights & Measures (Packaged Commodities) Rules, 1977 (“Packaging Rules”) issued under the Standards of Weights and Measures Act, 1976 set out the rules applicable to packaged commodities. ‘Pre-packed commodity’ means a commodity which, without the purchasers being present, is placed in a package of whatever nature, whether sealed or opened,, so that the quantity of the product containing therein has a pre-determined value and such value cannot be altered without the package or its lid or cap, as the case may be, being opened or undergoing a perceptible modification. The expression ‘Package’ is to be construed as a package containing a pre-packed commodity. Every company selling such packaged product must ensure that the package being sold bears a label containing the name and address of the manufacturer and the packer, a common description of the commodity/commodities packaged, the net quantity of the commodity, the month and year of manufacture and the maximum retail price of the product. A consumer buying such product must ensure that these declarations are mentioned prominently on the label of the product. The Weights & Measures Organization, Controller of Legal Metrology at the state level, Assistant Controller of Legal Metrology at the divisional level and Inspector, Weights & Measures at circle level are the appropriate authorities for redressal of any disputes under the Packaging Rules. Environmental Regulations Our Company is subject to Indian laws and regulations concerning environmental protection. The principal

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environmental regulations applicable to industries in India are the Water (Prevention and Control of Pollution) Act, 1974, the Water Access Act, 1977, the Air (Prevention and Control of Pollution) Act, 1981, the Environment Protection Act, 1986 and the Hazardous Wastes (Management and Handling) Rules, 1989. Further, environmental regulations require a company to file an Environmental Impact Assessment (“EIA”) with the State Pollution Control Board (“PCB”) and the Ministry of Environment and Forests (“MEF”) before undertaking a project entailing the construction, development or modification of any plant, system or structure. If the PCB approves the project, the matter is referred to the MEF for its final determination. The estimated impact that a particular project might have on the environment is carefully evaluated before granting clearances. When granting clearance, conditions may be imposed and the approving authorities may direct variations to the proposed project. Kyoto Protocol and Carbon Credits The Kyoto Protocol is a protocol to the International Framework Convention on Climate Change with the objective of reducing greenhouse gases (“GHG”) that cause climate change. The Kyoto Protocol was agreed on December 11, 1997 at the third conference of the parties to the treaty when they met in Kyoto, and entered into force on February 16, 2005. India ratified the Kyoto Protocol on August 22, 2006. The Hazardous Waste (Management, Handling and Transboundary Movement) Rules, 2008 The Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008, as amended (“Hazardous Wastes Rules”), which superseded the Hazardous Wastes (Management and Handling) Rules, 1989, state that the occupier will be responsible for safe and environmentally sound handling of hazardous wastes generated in his establishment. The hazardous wastes generated in the establishment of the occupier should be sent or sold to a recycler or re-processor or re-user registered or authorised under the Hazardous Wastes Rules or should be disposed off in an authorised disposal facility. The Ministry of Environment and Forests has been empowered to deal with the trans-boundary movement of hazardous wastes and to grant permission for transit of hazardous wastes through any part of India. No import of hazardous waste is permitted in India. The State Government, occupier, operator of a facility or any association of the occupier will be individually or jointly or severally responsible for, and identify sites for, establishing the facility for treatment, storage and disposal of hazardous wastes for the State. Foreign Investment Regulation The industrial policy was formulated in 1991 to implement the Government’s liberalisation programme and consequently industrial policy reforms relaxed industrial licensing requirements and restrictions on foreign investment. FDI is allowed under the automatic route for 100% in respect of sector in which our Company carries out its business. Labour Laws The workers are regulated by various labour laws, rules and regulations including the Workmen Compensation Act, 1923, the Payment of Wages Act, 1936, the Employees’ State Insurance Act, 1948, the Factories Act, 1948, the Minimum Wages Act, 1948, the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, the Payment of Bonus Act, 1965, the Contract Labour (Regulation and Abolition) Act, 1970 and the Payment of Gratuity Act, 1972, where applicable. Intellectual Property Laws In India, trademarks enjoy protection under both statutory and common law. The Trade Marks Act, 1999 protects a distinct ‘mark’. The Trade Marks Act also makes special provision for application of marks as ‘collective marks’. The Registrar of Trademarks is the authority responsible for registration of the trademarks, settling opposition proceedings and rectification of the register of trademarks. The Indian Patent Act, 1970 protects any new invention / inventive step allowing the inventor the opportunity to reap the benefits of his effort. The patent may be for a process or a product. An application for patent can be filed at any of the four patent offices in India.

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Shops and Establishments legislations in various states The provisions of various Shops and Establishments legislations, as applicable, regulate the conditions of work and employment in shops and commercial establishments and generally prescribe obligations in respect of inter alia registration, opening and closing hours, daily and weekly working hours, holidays, leave, health and safety measures and wages for overtime work. Property Laws The Transfer of Property Act, 1882 (“TP Act”) lays down general principles for the transfer of immovable property in India. It specifies the categories of property that can be transferred, the persons competent to transfer property, the legitimacy of restrictions and conditions imposed on the transfer and the creation of contingent and vested interest in the property. The TP Act recognizes, among others, sale, mortgage, charge and lease as forms in which an interest in an immovable property may be transferred.

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HISTORY AND CERTAIN CORPORATE MATTERS Our Company was incorporated as Adlabs Films Private Limited on November 30, 1987, as a private limited company under the Companies Act. It was involved in the business of processing of advertising films. Our Company was originally promoted by Manmohan Ramanna Shetty and Vasanji Asaria Mamania. In 1989, our Company entered into the business of motion picture processing by setting up a film processing laboratory at Andheri, Mumbai. On June 19, 2000, pursuant to the conversion of our Company into a public company, the name of our Company was changed to Adlabs Films Limited. Subsequently, in December 2000, our Company made an initial public offering of 44,00,150 Equity Shares. On June 30, 2005, one of our Promoters i.e. Reliance Land Private Limited entered into share purchase agreements with Vasanji Asaria Mamania and Rubaiyat Arun Patel, erstwhile shareholders of our Company, for acquiring an aggregate of 23.20% of our Company’s shareholding. Further, our Board of Directors, pursuant to their resolution dated August 8, 2005, approved issuance of 1,10,00,000 Equity Shares on preferential basis to Reliance Land Private Limited along with 38,00,000 warrants, convertible into one Equity Share for each warrant held of our Company. Pursuant to the above, Reliance Capital Limited and Reliance Land Private Limited made an open offer for acquiring a further shareholding of 20.00% of our Company in compliance with the Takeover Code. On September 14, 2007, the High Court of Judicature at Bombay approved the scheme of amalgamation pursuant to which Katch 22 Entertainment Private Limited was amalgamated with our Company with effect from April 1, 2006. For further detail, please see the part entitled “Scheme of Arrangements- The scheme of amalgamation amongst Katch 22 Entertainment Private Limited, our Company and their respective shareholders and creditors” in this chapter at page 136. On March 7, 2008, the High Court of Judicature at Bombay approved the scheme of arrangement pursuant to which Entertainment One Limited was merged into our Company and the digital cinema business of Adlabs Multiplex and Theatres Limited (formerly Mukta Adlabs Digital Exhibition Private Limited) was demerged to our Company with effect from April 1, 2005. For further detail, see “Scheme of Arrangements- The composite and modified schemes of amalgamation and arrangement amongst Entertainment One Limited, Adlabs Multiplex and Theatres Limited (previously known as Mukta Adlabs Digital Exhibition Private Limited), our Company and their respective shareholders and creditors” in this chapter at page 137. On April 4, 2009, the High Court of Judicature at Bombay approved the scheme of arrangement pursuant to which the radio business of our Company was demerged to Reliance Broadcast Network Limited (previously known as Reliance Unicom Limited) with effect from April 1, 2008. For further details, please see the part entitled “Scheme of Arrangements - The scheme of arrangement amongst Reliance Broadcast Network Limited (previously known as Reliance Unicom Limited) our Company and their respective shareholders and creditors” in this section at page 139. On May 8, 2009, the High Court of Judicature at Bombay approved the scheme of arrangement pursuant to which Adlabs Multiplexes and Theatres Limited, Adlabs Multiplex Limited, Mahimna Entertainment Private Limited, Rave Entertainment Private Limited were merged into our Company with effect from April 1, 2008. For further detail, see “Scheme of Arrangements - The scheme of amalgamation amongst Adlabs Multiplexes and Theatres Limited, Adlabs Multiplex Limited, Mahimna Entertainment Private Limited, Rave Entertainment Private Limited, our Company and their respective shareholders and creditors” in this chapter at page 140. Our Company’s name was further changed to Reliance MediaWorks Limited pursuant to which a fresh certificate of incorporation dated October 5, 2009 was issued by the RoC. Changes in Registered Office The details of change in the registered office are set forth below:

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Date of Change of Registered Office

Details of the address of Registered Office Reasons for change

July 17, 2000 Change of registered office address from 35/38 Suren Road, Andheri (East), Mumbai 400 093 to Film City Complex, Goregaon (East), Mumbai 400 065

The change in our registered office was to ensure greater operational efficiency.

The Main Objects of Company The main objects, inter alia, contained in the Memorandum of Association of our Company are as follows: 1. To carry on the business of manufacturers, producers, exporters, importers, hirers, dealers,

distributors and exhibitors of raw films, chemicals, photographic and optical goods, cinematographic films, video cassettes, apparatus, recorders, machinery and equipments pertaining to or required for the film developing, printing, processing, editing, sound recording, re-recording, transferring, dubbing of sound, video taping, transferring film to video, duplicating video cassettes, discs or any format and to edit various formats.

2. To arrange to produce, secure, procedure, acquire, retain, purchase, publish, dispose off and

distribute advertisement films, TV serials, feature films, and programmes of educational, cultural, devotional, industrial, health, entertainment, family welfare, tourism, Governmental and of other subjects of interest.

The main objects as contained in the Memorandum of Association enable our Company to carry on the business presently carried out as well as business proposed to be carried out and the activities proposed to be undertaken pursuant to the Objects of the Issue. Amendments to the Memorandum of Association Our Memorandum of Association was amended from time to time pursuant to the change in the authorised share capital of our Company. For details of change in the authorised capital of our Company since its incorporation, please see the chapter entitled “Capital Structure” at page 69. The details along with the amendment of our Memorandum of Association due to changes other than the changes to authorised share capital are set out below:

Date of shareholders’

resolution

Nature of Amendment

December 2, 1999

The name of our Company was changed from Adlabs Films Private Limited to Adlabs Films Limited

January 12, 2006 Additions were made to other objects of our Company by inserting clauses 86 to 91 to the clause III(C) of the Memorandum of Association, as follows: “86.To carry on the business of running a TV Station, Radio Station, recording studio,

shooting studio, sound mixing studio, dubbing studio, editing unit, preview theatre, hiring out the film shooting equipment, studios for production of serials for the Indian Market and export thereof.

87. To carry on the business of production of Television serials and radio programmes,

to play, relay, uplink, downlink, broadcast, telecast live or otherwise all kinds of programme including but not restricted to entertainment, news, and current affairs, health, game shows, songs, features films, educational, sports and artistic shows or any other entertainment content.

88. To carry on the business of development of music software including series of

sound or music recorded on magnetic tapes, cassette, compact disk and digital media, digital system for pre-production, post production and software for commercial broadcasting which can be played and reproduced on any appropriate

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Date of shareholders’

resolution

Nature of Amendment

apparatus for the Indian market and for transfer and export by any means out of India.

89. To carry on business of financing any person or partnership firm, joint venture

company, body corporate or any other entity, whether incorporated or not and whether in India or abroad related to film production, TV serial , TV channels, radio programmes, running and maintenance of multiplex and all or any objects in relation thereto.

90. To carry on the business of designers, manufacturers, processors, assemblers,

dealers, traders, distributors, importers, exporters, agents, consultants, designers and contractors, for erection and commissioning turn-key or transporting and converting, repairing, installing, training, servicing maintenance of all kinds of telephone instruments, intercoms, accessories, telecommunication, radio communication equipment further for the Indian market and for transfer and export by any means out of India.

91. To carry on business of construction, development and maintenance, of residential

complex, commercial complex, entertainment centres, convention centres, exhibition centres, guest house, restaurants, parlours, including all value added services such as recreational and other facilities such as movie theatre, hotels, fast food centre, exhibitions of paintings, telecommunication centre, fitness centre, children’s theme park, amusement park.”

September 30, 2009

The name of our Company was changed from Adlabs Films Limited to Reliance MediaWorks Limited.

Promoters The Promoters of our Company are Reliance Land Private Limited and Reliance Capital Limited. For details, please see the chapter entitled “Our Promoters and Promoter Group” at page 165. Capital raising activities through equity or debt As on July 27, 2012, our Company had 1,02,370 members. For further details regarding our debt capital raising, please see the chapter entitled “Financial Indebtedness” and regarding our equity capital raising, please see the chapter entitled “Capital Structure” at pages 475 and 69, respectively. Our Company’s Shareholders For details regarding our Comapny’s shareholders, please see the chapter entitled “Capital Structure” at page 69. Major events of our Company The table below sets forth some of the key events in our history:

Year Event 1989 Entered the business of motion picture processing by setting up a film processing

laboratory at Andheri, Mumbai December 2000

Our Company made an initial public offering of 44,00,150 Equity Shares

September 2001

Our first multiplex IMAX, Wadala, Mumbai was made operational

June 2005 The Reliance group acquired majority stake in our Company

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Year Event January 2006 Commenced the film distribution business May 2006 Incorporated wholly owned subsidiaries Adlabs Films (USA) Inc. (now known as Reliance

MediaWorks (USA) Inc) and Adlabs Films (UK) Limited (now known as Reliance MediaWorks (UK) Limited) in the United States and UK, respectively.

January 2007 Acquired a 51% stake in Synergy Communications Private Limited (Big Synergy Media Limited) which is involved in the business of operating in television content production

April 2007 Acquired 100% stake in Rave Entertainment Private Limited in order to establish our Company’s presence in the theatrical exhibition business in the North

September 2008

Film processing, digital cinema and post-production facilities was certified by the Federation Against Copyright Theft, UK

February 2008 Incorporated a wholly owned subsidiary namely Adlabs Films Netherland B.V. (now known as Reliance MediaWorks (Netherlands) B.V.) in the Netherlands for distribution of films

April 2008 Commenced exhibition business in the United States through our Subsidiaries September 2008

Acquired 90% of the paid-up capital of Lowry Digital, which enabled us to enter film restoration business in USA

October 2008 Our theatrical exhibition business was re-branded as “BIG Cinemas” November 2008

Acquired 70% of the paid-up capital of Big Cinemas Lotus Five Star Sdn. Bhd., Malaysia, through one of our Subsidiaries, which enabled us to enter the exhibition business in Malaysia

May 2009 Entered into the business of digital restoration and content processing facilities by acquiring AAA Digital Imaging Private Limited (now known as Reliance MediaWorks Entertainment Services Limited)

June 2009 Transfer and vesting of our radio business in Reliance Unicom Limited (now known as Reliance Broadcast Network Limited) with effect from April 1, 2008

December 2009

Acquired iLab, a dedicated film and media services facility located in Soho, London

January 2011 Commencement of operations of Stage 1 of our Studio May 2011 Sold 89.68% stake in Sri Ramakrishna Theatre Limited held by our Company. It is no

longer a subsidiary of our Company. June 2011 Sold 50% stake in Cineplex Private Limited held by our Company. It is no longer a joint

venture of our Company. June 2012 Acquired the remaining 30% of the paid-up capital of Big Cinemas Lotus Five Star Sdn.

Bhd., Malaysia, making it a wholly owned subsidiary of Reliance MediaWorks (Malaysia) Sdn Bhd., one of our indirect subsidiaries.

Our Business For details in relation to our business, please see the chapter entitled “Business” at page 111. Injunction or restraining order Our Company is under no injunction or restraining order. Technology and market competence For details on the technology and market competence of our Company, please see the chapter entitled “Business” at page 111. Competition For details on the competition faced by our Company, please see the chapter entitled “Business” at page 111.

Our Subsidiaries and Joint Ventures

Our Company has 28 Subsidiaries and 2 (two) Joint Ventures. For details, please see the chapter entitled

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“Our Subsidiaries and Joint Ventures” at page 143. Proposed Internal Restructuring On February 21, 2012, our Company’s shareholders approved the proposed transfer of our exhibition and film and media services divisions to certain of our wholly owned subsidiaries that we are yet to identify. Accordingly, we are in process of transferring these business divisions. We believe that such a transfer will enable us to garner fresh investment into these businesses and harness the growth potential. Towards this end, we may also consider entering into technical and financial collaboration with strategic and private equity partners either directly or through our subsidiaries. Further, should an appropriate opportunity arise, we may acquire or partner with companies that we believe will enhance our business, revenues and profitability. The impact, if any, on our financial statements cannot be quantified, at present. The above process will not impact our equity share capital. Our Company has, on July 17, 2012, executed an indicative non-binding term sheet with a private equity fund to acquire a substantial minority stake through an investment of `60,500 lakhs in our Company’s film and media services division. The investment is proposed to be made into the subsidiary of our Company, into which our film and media services division will be transferred. No definitive agreement has been executed in respect of the proposed transaction. Scheme of Arrangements

a. The scheme of amalgamation (“Katch 22 Scheme”) amongst Katch 22 Entertainment Private

Limited (“Katch”), our Company and their respective shareholders and creditors.

The Katch 22 Scheme was approved by the High Court of Judicature at Bombay on September 14, 2007, thereby granting its approval for amalgamation of Katch with our Company. The purpose of the merger was to achieve business synergies and operational consolidation as well as convenience. The Katch 22 Scheme was approved with effect from April 1, 2006 (“Appointed Date”). The Katch 22 Scheme provided for transfer and vesting of the “undertaking” (as described below) in our Company. “Undertaking” means the entire business of Katch along with all assets, properties, debts, liabilities and obligations pertaining to the same. Set forth below are the key features of the Katch 22 Scheme: Share Capital as on March 31, 2006:

i. The authorised capital of Katch was `1,00,000 and the issued, subscribed and paid

up share capital on the same date was `1,00,000. After March 31, 2006, Katch issued and allotted 13,00,000, 9% non-cumulative redeemable preference shares of `1 each for cash at a premium of `99 each.

ii. The authorised capital of our Company was `30,00,00,000 and the issued, subscribed and paid up share capital on the same date was `19,90,03,750.

Date of operation of Katch 22 Scheme: The Katch 22 Scheme shall be effective from

Appointed Date but shall be operative from the date on which the certified copy of the High Court order is filed with the RoC i.e. October 9, 2007 (“Effective Date”).

Transfer and vesting of Undertaking: With effect from the Appointed Date the undertaking of Katch was transferred to and vested in our Company.

Cancellation of existing share capital: Upon the Katch 22 Scheme being effective, no

shares of our Company shall be allotted in lieu or exchange of its holding in Katch and the share capital of Katch stood cancelled.

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Contracts, deeds, bonds and other instruments: All contracts, deeds, bonds and other instruments to which Katch was a party to and which were subsisting before the arrangement to be in full force and effect against and in favour of our Company.

Legal Proceedings: All suits, appeal and other legal proceedings, pending by or against

Katch arising at the Appointed Date, as and from the Effective Date were continued and enforced by or against our Company.

Staff, employees and workmen: On the Katch 22 Scheme becoming operative, all the

employees, staff and workmen of Katch in service on the Effective Date were transferred to our Company on terms and conditions not less favorable than subsisting with Katch on the Effective Date.

Accounting Treatment: Our Company recorded all the assets and liabilities of Katch transferred to and vested in our Company at their fair values. The investment in Katch, appearing in books of our Company stood cancelled. The difference, being the excess or shortfall of the net assets of Katch transferred to our Company against the book value of the investment in the shares of Katch recorded by our Company, along with a diminution in the value of assets and liabilities of our Company, pursuant to the order of the High Court of Judicature at Bombay, was adjusted against general reserves.

Dissolution: Upon the Katch 22 Scheme becoming effective, Katch stood dissolved without being wound up.

b. The composite and modified scheme of amalgamation and arrangement (“EM Scheme”) between

Entertainment One Limited (“EOIL”), Adlabs Multiplex and Theatres Limited (previously, Mukta Adlabs Digital Exhibition Private Limited) (“MADEL”), our Company and their respective shareholders and creditors. The High Court of Judicature at Bombay pursuant to its order dated September 15, 2006 sanctioned the Composite Scheme which, interalia, provided for the amalgamation of EOIL and demerger of the digital cinema business of MADEL to our Company with effect from April 1, 2005 along with demerger of the radio business of our Company to RUL effective from March 31, 2006. Subsequently, an application was filed with the Ministry of Information and Broadcasting by our Company for the vesting of radio licenses held by it in the name of RUL. Pending receipt of the above-mentioned approval and completion of licensing and other procedural formalities, the Composite Scheme was eventually not filed with the RoC as required under the applicable provisions of the Companies Act. Thereafter, our Company filed a modified scheme of arrangement which was between our Company, EOIL, MADEL and their respective shareholders and creditors (“EM Scheme”). The EM Scheme was approved by the High Court of Judicature at Bombay on March 7, 2008, thereby granting its approval to merge EOIL into our Company and demerge the digital cinema business of MADEL to our Company. The purpose of the merger was to streamline the film production and exhibition businesses of our Company. The EM Scheme was approved with effect from April 1, 2005 (“Appointed Date”). The EM Scheme provided for transfer and vesting of (i) “EOIL undertaking”; and (ii) “MADEL undertaking” in our Company. “EOIL undertaking” means the entire business and, all assets, properties, debts, liabilities and obligations of EOIL as on the Appointed Date. “MADEL undertaking” means the digital cinema business and, all related assets, properties, debts, liabilities and obligations pertaining to the digital cinema business of MADEL as on the Appointed Date. Set forth below are the key features of the EM Scheme: Share Capital as on March 31, 2006:

i. The authorised capital of EOIL was `25,00,000.00 and the issued, subscribed and

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paid up share capital on the same date was `5,00,000.00.

ii. The authorised capital of MADEL was `10,00,00,000.00 and the issued, subscribed and paid up share capital on the same date was `1,00,000.00.

iii. The authorised capital of our Company was `30,00,00,000.00 and the issued, subscribed and paid up share capital on the same date was `19,90,03,750.

Date of operation of EM Scheme: The EM Scheme shall be effective from Appointed Date

but shall be operative from the date on which the certified copy of the High Court order is filed with the RoC i.e. March 31, 2008 (“Effective Date”).

Transfer and vesting of Undertaking: i. With effect from the Appointment Date and upon the EM Scheme becoming

effective, the EOIL undertaking was transferred and vested in our Company.

ii. With effect from the Appointed Date, the MADEL undertaking was transferred and vested in our Company as a going concern. With effect from the Appointment Date and upon the EM Scheme becoming effective, all statutory licenses and permits required by MADEL for carrying on the business of digital cinema business were vested in our Company in accordance with the terms of the EM Scheme. However, the transfer and vesting of the MADEL undertaking is subject to the securities, charges, mortgages and other encumbrances that were subsisting in respect to MADEL undertaking or any part thereof.

Cancellation of existing share capital: Upon the EM Scheme being effective, no share of

our Company shall be allotted in lieu or exchange of its holding in EOIL and the share capital of EOIL stood cancelled.

Contracts, deeds, bonds and other instruments: All contracts, deeds, bonds and other instruments to which EOIL and MADEL (pertaining to its digital cinema business) were party to and which were subsisting on the Effective Date continued to be in full force and effect in the name of our Company.

Legal Proceedings: All suits, appeal and other legal proceedings, pending on or after the Appointed Date by or against EOIL and MADEL (pertaining to its digital cinema business) were continued and enforced by or against our Company.

Staff, employees and workmen: With effect from the Appointment Date and upon the EM

Scheme becoming effective, all the employees, staff and workmen of EOIL and MADEL (pertaining to its digital cinema business) were transferred to our Company on terms and conditions not less favorable than subsisting with EOIL and MADEL on the Effective Date.

Accounting Treatment: Upon the EM Scheme becoming effective, investments in the equity share capital of EOIL as appearing in our Company’s books of accounts was cancelled. Also, all assets and liabilities recorded in the books of accounts of EOIL was transferred to and vested in our Company and the same was recorded at their fair values as on the Appointed Date. The inter company balances was cancelled. The excess of the fair value of the assets recorded over and above the value of our Company’s liabilities, less the book value of the equity shares of EOIL as appearing in our Company’s books, if positive, was to be created to the general reserve account of our Company and if negative be debited to the securities premium account. All credits were included in our general reserves, while all debits were adjusted against the securities premium account. Our Company recorded the asset and liabilities pertaining to digital cinema business of MADEL at the respective book values in the books of our Company as on the Appointed Date. MADEL reduced the book

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value of asset and liabilities pertaining to the digital cinema business of MADEL. Excess of book value of assets over book value of liabilities of the digital media business of MADEL to be adjusted; credits against general reserve and debits were to be adjusted against the securities premium. Further, the financial statements of our Company prepared after the Effective Date was not to record the results of the transaction related to radio business from March 31, 2006 upto the Effective Date in its profit and loss accounts and, instead, the net effect of all such transactions was to be debited / credited to the general reserve account of our Company.

Dissolution: Upon the EM Scheme becoming effective, EOIL shall be dissolved without being wound up.

Remaining Business of MADEL: The remaining business of MADEL and assets, liabilities

and obligations pertaining thereto shall continue to belong to and be vested in and be managed by MADEL.

c. The scheme of arrangement (“RUL Scheme”) amongst Reliance Broadcast Network Limited (previously known as Reliance Unicom Limited) (“RUL”), our Company and their respective shareholders and creditors. The RUL Scheme was approved by the High Court of Judicature at Bombay on April 4, 2009, thereby granting its approval to demerge the radio business of our Company to RUL. The purpose of the demerger was to explore the potential of radio business of our Company to the fullest, provide focused leadership and management attention and enhance shareholder value. The RUL Scheme was approved with effect from April 1, 2008 (“Appointed Date”). The RUL Scheme provided for transfer and vesting of the “radio business undertaking” (as described below) in RUL as a going concern. “Radio business undertaking” means the radio business of our Company along with all related assets, properties, debts, liabilities and obligations pertaining to the same and as mutually agreed between our Board of Directors and the board of directors of RUL. Pursuant to the RUL Scheme, all the shareholders of our Company were issued one RUL equity share for every equity share of our Company held by them. Set forth below are the key features of the RUL Scheme: Share Capital as on March 31, 2008:

i. The authorised capital of RUL was `1,05,50,000 and the issued, subscribed and

paid up share capital on the same date was `1,05,50,000.

ii. The authorised capital of our Company was `30,00,00,000 and the issued, subscribed and paid up share capital on the same date was `23,06,30,850.

Date of operation of RUL Scheme: The RUL Scheme shall be effective from Appointed

Date but shall be operative from the date on which the certified copy of the High Court order is filed with the RoC i.e. June 30, 2009 (“Effective Date”).

Transfer and vesting of Undertaking: With effect from the Appointed Date the radio business undertaking of our Company was transferred to and vested in RUL as a going concern. Also, all licenses, permissions, approvals and consents held by our Company that are required for carrying out the operations of the radio business were also transferred and vested in RUL and mutated by the statutory authorities concerned in favour of RUL. The demerger was subject to the securities, charges and mortgages and other encumbrances created to secure the liabilities forming part of the radio business.

Cancellation of existing share capital: Pursuant to the demerger, RUL shall in respect of

every equity share of `5/- each of our Company issue one equity share of `5/- each in

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RUL. The capital of RUL shall increase to that extent. The shares held by our Company in RUL stood cancelled.

Contracts, deeds, bonds and other instruments: All contracts, deeds, bonds and other

instruments to which our Company (pertaining to its radio business) was a party to and which were subsisting on the Effective Date continued to be in full force and effect in the name of RUL.

Legal Proceedings: All suits, appeal and other legal proceedings, pending by or against our

Company (pertaining to its radio business) were continued and enforced by or against RUL.

Staff, employees and workmen: On the RUL Scheme being operative, all the employees,

staff and workmen of our Company (pertaining to its radio business) in service on the Effective Date were transferred to RUL on terms and conditions not less favorable than subsisting with our Company on the Effective Date.

Accounting Treatment: In terms of the RUL Scheme, the book value of the assets and

liabilities pertaining to our radio business undertaking were reduced by our Company at our book values. The difference that is in excess of the book value of the assets pertaining to radio business undertaking over liabilities after adjusting the investments made by our Company in RUL was to be, in the event of a credit balance be credited to our Company’s capital reserve account, and in the event of a debit, was to be adjusted against our Company’s securities premium account. RUL shall record all assets and liabilities pertaining to the radio business at the respective book values on the Appointed Date. There will be a credit in share capital, to the extent of the shares issued. Further, in relation to RUL, the liabilities in excess of assets recorded by RUL over and above the amount credited as share capital after adjusting the cancellation of then existing share capital of RUL held by our Company shall be deemed to comprise and be credited to the extent of `10,000 lakhs was credited to the securities premium account, and the balance, if any, was to be treated as capital reserve arising on acquisition of business pursuant to the demerger. In event of shortfall, the same was to be debited and carried forward as goodwill.

Remaining Business of our Company: The remaining business of our Company and assets, liabilities and obligations pertaining thereto shall continue to belong to and be vested in and be managed by our Company.

d. The scheme of amalgamation (“AAMR Scheme”) amongst Adlabs Multiplexes and Theatres Limited (“AMTL”), Adlabs Multiplex Limited (“AML”), Mahimna Entertainment Private Limited (“MEPL”), Rave Entertainment Private Limited (“Rave”) (collectively, “Transferor Companies”), our Company and their respective shareholders and creditors. The AAMR Scheme was approved by the High Court of Judicature at Bombay on May 8, 2009, thereby granting its approval for merging AMTL, AML, MEPL and Rave with our Company. The purpose of the merger was for administrative convenience and economical and operational synergy. The AAMR Scheme was approved with effect from April 1, 2008 (“Appointed Date”). The AAMR Scheme provided for transfer and vesting of the “undertakings” (as described below) in our Company. “Undertaking” means the entire business of the Transferor Companies along with all assets, properties, debts, liabilities and obligations pertaining to the same.

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Set forth below are the key features of the AAMR Scheme: Share Capital as on March 31, 2008:

i. The authorised capital of AMTL was `10,00,00,000 and the issued, subscribed

and paid up share capital on the same date was `5,00,000.

ii. The authorised capital of AML was `1,00,00,000 and the issued, subscribed and paid up share capital on the same date was `98,10,000.

iii. The authorised capital of MEPL was `1,00,000 and the issued, subscribed and

paid up share capital on the same date was `1,00,000. After March 31, 2008, the authorised share capital was changed to `2,90,000 and the issued, subscribed and paid up share capital was `2,90,000.

iv. The authorised capital of Rave was `5,00,00,000 and the issued, subscribed and paid up share capital on the same date was `3,00,00,000. After March 31, 2008, the authorised share capital was changed to `5,00,00,000 and the issued, subscribed and paid up share capital was `5,00,00,000.

v. The authorised capital of our Company was `30,00,00,000 and the issued, subscribed and paid up share capital on the same date was `23,06,30,850.

Upon the sanction of the AAMR Scheme, the authorised share capital of our Company was increased by the authorised share capital of the Transferor Companies.

Date of operation of AAMR Scheme: The AAMR Scheme shall be effective from Appointed Date but shall be operative from the date on which the certified copy of the High Court order is filed with the RoC i.e. May 29, 2009 (“Effective Date”).

Transfer and vesting of Undertaking: With effect from the Appointed Date the undertakings of the Transferor Companies were transferred to and vested in our Company. Also, all licenses, permissions, approvals and consents held by the Transferor Companies were also transferred and vested in our Company. The merger was subject to the securities, charges and mortgages and other encumbrances created or subsisting in respect of the assets of the Transferor Companies with respect to the financial agreement and arrangements entered into by the Transferor Companies.

Cancellation of existing share capital: Upon the AAMR Scheme being effective, no shares

of our Company shall be allotted in lieu or exchange of its holding in the Transferor Companies and the share capital of Transferor Companies stood cancelled.

Contracts, deeds, bonds and other instruments: All contracts, deeds, bonds and other

instruments to which the Transferor Companies were a party to and which were subsisting on the AAMR Scheme coming into effect continued to be in full force and effect against our in favour of our Company.

Legal Proceedings: All suits, appeal and other legal proceedings, pending by or against the

Transferor Companies were continued and enforced by or against our Companies. Staff, employees and workmen: On the AAMR Scheme becoming operative, all the

employees, staff and workmen of the Transferor Companies in service on the Effective Date were transferred to our Company on terms and conditions not less favorable than subsisting with the Transferor Companies on the Effective Date.

Accounting Treatment: On the AAMR Scheme becoming operative, all our investment in the share capital of the Transferor Companies stood cancelled. Further, all assets and

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liabilities of the Transferor Companies were recorded by our Company at their respective fair values as on March 31, 2009. The inter company balance and transactions stood cancelled. The difference between the amount of assets and liabilities taken over and recorded by our Company after making all required adjustments along with any appreciation/diminution in the value of our assets whether fixed or current investments, if any, were to be adjusted into the capital reserve account.

Dissolution: Upon the AAMR Scheme becoming effective, the Transferor Companies stood dissolved without being wound up.

Financial and Strategic Partners Our Company does not have any financial or strategic partners.

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OUR SUBSIDIARIES AND JOINT VENTURES

Our Company has the following 28 Subsidiaries and two Joint Ventures. Except as disclosed in this Draft letter of Offer, none of our Subsidiaries or Joint Ventures is listed on any stock exchange or has made any public or rights issue in the last three years or has become a sick company under the meaning of the Sick Industrial Companies Act, 1985 or is under winding up as of the date of this Draft Letter of Offer. Unless otherwise specified, all information in this section is as on the date of this Draft letter of Offer. Following are the Subsidiaries of our Company:

1. Big Cinemas Entertainment (DE) LLC; 2. Big Cinemas Entertainment LLC; 3. Big Cinemas Exhibitions LLC; 4. Big Cinemas Falls Church LLC; 5. Big Cinemas Galaxy LLC; 6. Big Cinemas IMC LLC; 7. Big Cinemas Laurel LLC; 8. Big Cinemas Lotus Five Star Sdn. Bhd.; 9. Big Cinemas Norwalk LLC; 10. Big Cinemas Phoenix LLC; 11. Big Cinemas Sahil LLC; 12. Big Cinemas SAR LLC; 13. Big Pictures USA, Inc.; 14. Big Synergy Media Limited; 15. Phoenix Big Cinemas Management LLC; 16. Rave Entertainment and Food Nepal Private Limited; 17. Reliance Lowry Digital Imaging Services Inc.; 18. Reliance Media Consultant Private Limited; 19. Reliance Media & Marketing Communications LLC; 20. Reliance MediaVentures Private Limited 21. Reliance MediaWorks Entertainment Services Limited (formerly, Digital Media Imaging Limited) 22. Reliance MediaWorks Theatres Limited (formerly, Adlabs Distributors and Exhibitors Limited) 23. Reliance Media Works VFX Inc.; 24. Reliance MediaWorks (Malaysia) Sdn. Bhd.; 25. Reliance MediaWorks (Mauritius) Limited; 26. Reliance MediaWorks (UK) Limited; 27. Reliance MediaWorks (USA) Inc.; and 28. Reliance MediaWorks (Netherlands) B.V.

Following are the joint ventures set up by our Company: 1. Divya Shakti Marketing Private Limited; and 2. Swanston Multiplex Cinemas Private Limited. Subsidiaries

1. Big Cinemas Entertainment (DE) LLC

Corporate Information

Big Cinemas Entertainment (DE) LLC was incorporated in Delaware, USA, under applicable US law on January 24, 2008 as Adlabs Entertainment (DE) LLC. Big Cinemas Entertainment (DE) LLC is primarily engaged in the business of exhibition of films.

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Capital Structure Big Cinemas Entertainment (DE) LLC does not have any share capital. Shareholding Big Cinemas Entertainment (DE) LLC is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc., which in turn is a wholly owned subsidiary of our Company.

2. Big Cinemas Entertainment LLC

Corporate Information

Big Cinemas Entertainment LLC was incorporated in New Jersey, USA, under applicable US law on December 19, 2007 as Adlabs Entertainment LLC. Big Cinemas Entertainment LLC is primarily engaged in the business of exhibition of films.

Capital Structure Big Cinemas Entertainment LLC does not have any share capital. Shareholding Big Cinemas Entertainment LLC is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc., which in turn is a wholly owned subsidiary of our Company.

3. Big Cinemas Exhibitions LLC

Corporate Information

Big Cinemas Exhibitions LLC was incorporated in Delaware, USA, under applicable US law on March 6, 2008 as Adlabs Exhibition LLC. Big Cinemas Exhibitions LLC is primarily engaged in the business of exhibition of films.

Capital Structure Big Cinemas Exhibitions LLC does not have any share capital. Shareholding Big Cinemas Exhibitions LLC is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc., which in turn is a wholly owned subsidiary of our Company.

4. Big Cinemas Falls Church LLC

Corporate Information

Big Cinemas Falls Church LLC was incorporated in Virginia, USA, under applicable US law on November 8, 2007 as Adlabs Falls Church LLC. Big Cinemas Falls Church LLC is primarily engaged in the business of exhibition of films.

Capital Structure Big Cinemas Falls Church LLC does not have any share capital. Shareholding Big Cinemas Falls Church LLC is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc.,

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which in turn is a wholly owned subsidiary of our Company.

5. Big Cinemas Galaxy LLC

Corporate Information

Big Cinemas Galaxy LLC was incorporated in Georgia, USA, under applicable US law on December 21, 2007 as Adlabs Galaxy LLC. Big Cinemas Galaxy LLC is primarily engaged in the business of exhibition of films.

Capital Structure Big Cinemas Galaxy LLC does not have any share capital. Shareholding Big Cinemas Galaxy LLC is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc., which in turn is a wholly owned subsidiary of our Company.

6. Big Cinemas IMC LLC

Corporate Information

Big Cinemas IMC LLC was incorporated in California, USA, under applicable US law on January 10, 2008 as Adlabs IMC LLC, and it was accepted by the concerned regulatory authority on January 19, 2008. Big Cinemas IMC LLC is primarily engaged in the business of exhibition of films.

Capital Structure Big Cinemas IMC LLC does not have any share capital. Shareholding Big Cinemas IMC LLC is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc., which in turn is a wholly owned subsidiary of our Company.

7. Big Cinemas Laurel LLC

Corporate Information

Big Cinemas Laurel LLC was incorporated in Maryland, USA, under applicable US law on November 28, 2007 as Adlabs Laurel LLC. Big Cinemas Laurel LLC was earlier engaged in the business of exhibition of films. However, the cinema theatre operated by the company, i.e. Big Cinemas Laurel, was closed on May 9, 2010 due to expiry of its lease agreement. The company is currently not engaged in any business.

Capital Structure Big Cinemas Laurel LLC does not have any share capital. Shareholding Big Cinemas Laurel LLC is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc., which in turn is a wholly owned subsidiary of our Company.

8. Big Cinemas Lotus Five Star Sdn. Bhd.

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Corporate Information

Big Cinemas Lotus Five Star Sdn. Bhd. was incorporated in Malaysia under the applicable Malaysian law on June 30, 2008 as Reliance Lotus Five Star Cinemas Sdn. Bhd. Big Cinemas Lotus Five Star Sdn. Bhd. is primarily engaged in the business of operating cinema theatres.

Capital Structure

No. of ordinary shares Authorised capital 2,50,00,000 ordinary shares of RM 1/- each Issued, subscribed and paid-up capital 1,45,67,000 ordinary shares of RM 1/- each

Shareholding Big Cinemas Lotus Five Star Sdn. Bhd. is a wholly owned subsidiary of Reliance MediaWorks (Malaysia) Sdn. Bhd.

9. Big Cinemas Norwalk LLC

Corporate Information

Big Cinemas Norwalk LLC was incorporated in California, USA, under applicable US law on March 7, 2008 as Adlabs Norwalk LLC. Big Cinema Norwalk was closed on January 31, 2012 due to expiry of lease of the premises. The company is at present not engaged in any business.

Capital Structure Big Cinemas Norwalk LLC does not have any share capital. Shareholding Big Cinemas Norwalk LLC is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc., which in turn is a wholly owned subsidiary of our Company.

10. Big Cinemas Phoenix LLC

Corporate Information

Big Cinemas Phoenix LLC was incorporated in Delaware, USA, under applicable US law on February 22, 2008 as Adlabs Phoenix LLC. Big Cinemas Phoenix LLC is primarily engaged in the business of exhibition of films.

Capital Structure Big Cinemas Phoenix LLC does not have any share capital. Shareholding Reliance MediaWorks (USA) Inc. is a 51% member of Big Cinemas Phoenix LLC, which in turn is a wholly owned subsidiary of our Company.

11. Big Cinemas Sahil LLC

Corporate Information

Big Cinemas Sahil LLC was incorporated in Illinois, USA, under applicable US law on November 13, 2008 as Adlabs Sahil LLC. Big Cinemas Sahil LLC is primarily engaged in the business of

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exhibition of films.

Capital Structure Big Cinemas Sahil LLC does not have any share capital. Shareholding Reliance MediaWorks (USA) Inc. is a 97% member of Big Cinemas Sahil LLC, which in turn is a wholly owned subsidiary of our Company.

12. Big Cinemas SAR LLC

Corporate Information

Big Cinemas SAR LLC was incorporated in Michigan, USA, under applicable US law on November 8, 2007 as Adlabs SAR LLC. Big Cinemas SAR LLC was earlier engaged in the business of exhibition of films. However, the cinema theatre which was operated by the company, i.e. Big Cinemas Novi 8, was closed on September 30, 2010 due to expiry of its lease agreement. The company is currently not engaged in any business.

Capital Structure Big Cinemas SAR LLC does not have any share capital. Shareholding

Reliance MediaWorks (USA) Inc. is a 51% member of Big Cinemas SAR LLC, which in turn is a wholly owned subsidiary of our Company.

13. Big Pictures USA, Inc.

Corporate Information

Big Pictures USA, Inc. was incorporated in New Jersey, USA, under applicable US law on March 30, 2009. Big Pictures USA, Inc. has not commenced operations. Big Pictures USA, Inc. proposes to engage in the business of exhibition and distribution of films.

Capital Structure

No. of equity shares

Authorised capital 2,500 equity shares of no par value Issued, subscribed and paid-up capital Nil Shareholding

Big Pictures USA, Inc. is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc., which in turn is a wholly owned subsidiary of our Company.

14. Big Synergy Media Limited

Corporate Information

Big Synergy Media Limited was incorporated in India on February 24, 1988 under the Companies Act as Synergy Communications Private Limited. Big Synergy Media Limited is engaged in the business of television contents production.

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Capital Structure

No. of shares Authorised capital 20,000 equity shares of `100/- each and 12,00,000 preference

shares of `100/- each Issued, subscribed and paid-up capital 10,000 equity shares of `100/- each

Shareholding Our Company holds 5,100 equity shares of Big Synergy Media Limited, which constitutes 51% of interest in Big Synergy Media Limited.

15. Phoenix Big Cinemas Management LLC

Corporate Information

Phoenix Big Cinemas Management LLC was incorporated in the State of Tennessee, USA, under the applicable US law on February 22, 2008 as Phoenix Adlabs Theatre Management LLC, and it was accepted by the concerned regulatory authority on February 25, 2008. Phoenix Big Cinemas Management LLC is engaged in the business of managing theatres.

Capital Structure Phoenix Big Cinemas Management LLC does not have any share capital. Shareholding Reliance MediaWorks (USA) Inc. is a 51% member of Phoenix Big Cinemas Management LLC, which in turn is a wholly owned subsidiary of our Company.

16. Rave Entertainment and Food Nepal Private Limited

Corporate Information Rave Entertainment and Food Nepal Private Limited was incorporated in Nepal, under the law applicable in Nepal on August 24, 2008. Rave Entertainment and Food Nepal Private Limited is engaged in the business of food/cafeteria services, management of theatres etc.

Capital Structure

No. of ordinary shares Authorised capital 4,95,000 equity shares of NPR 100/- each Issued, subscribed and paid-up capital 96,000 equity shares of NPR 100/- each Shareholding Rave Entertainment and Food Nepal Private Limited is a wholly owned subsidiary of our Company.

The Company intends to divest its entire holding in this company. The board of our Company has by its resolution dated February 13, 2012 accorded its consent to sell our entire shareholding in the company.

Our Company has executed share purchase deed dated May 3, 2012 with a local buyer to sell the shares of Rave Entertainment and Food Nepal Private Limited at face value. The Company in accordance with applicable Nepali law, has, subsequently, sought the approval of the Department of Industries, Nepal for the said sale. The application is pending.

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17. Reliance Lowry Digital Imaging Services Inc.

Corporate Information

Reliance Lowry Digital Imaging Services Inc. was incorporated in California, USA, under the applicable US law on April 3, 2008. Reliance Lowry Digital Imaging Services Inc. is engaged in the business of film restoration and provides digital image correction and image enhancement facilities.

Capital Structure

No. of ordinary shares Authorised capital 1,000 ordinary shares of $1/- each Issued, subscribed and paid-up capital 1,000 ordinary shares of $1/- each

Shareholding Reliance MediaWorks (USA) Inc., a wholly owned subsidiary of our Company, and our Company hold 90.00% and 10.00% interest, respectively, in Reliance Lowry Digital Imaging Services Inc.

18. Reliance Media Consultant Private Limited Reliance Media Consultant Private Limited was incorporated in India on February 16, 2012 under the Companies Act. Reliance Media Consultant Private Limited is engaged in the business of offering consultancy and advisory services in all areas of film and media services.

Capital Structure

No. of equity sharesAuthorised Share Capital 10,000 equity shares of `10/- each Issued, subscribed and paid-up capital 10,000 equity shares of `10/- each

Shareholding Reliance Media Consultant Private Limited is a wholly owned subsidiary of our Company.

19. Reliance Media & Marketing Communications LLC

Corporate Information

Reliance Media & Marketing Communications LLC was incorporated in Delaware, USA, under the applicable US law on May 13, 2009 as Adlabs Media LLC. Reliance Media & Marketing Communications LLC is engaged in the business of marketing and advertising.

Capital Structure Reliance Media & Marketing Communications LLC does not have any share capital. Shareholding Reliance Media & Marketing Communications LLC is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc., which in turn is a wholly owned subsidiary of our Company.

20. Reliance MediaVentures Private Limited Corporate Information

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Reliance MediaVenture Private Limited was incorporated under the Companies Act, 1956 on June 19, 2012. Reliance MediaVentures Private Limited is yet to commence business operations.

Capital Structure

No. of equity shares Authorised capital 10,000 equity shares of `10/- each Issued, subscribed and paid-up capital 10,000 equity shares of `10/- each

Shareholding Reliance MediaVenture Private Limited is a wholly owned subsidiary of our Company.

21. Reliance MediaWorks Entertainment Services Limited (formerly, Digital Media Imaging Limited)

Corporate Information

Reliance MediaWorks Entertainment Services Limited was incorporated in India on March 27, 2006 under the Companies Act. Reliance MediaWorks Entertainment Services Limited is engaged in the business of conversion of 2D movies into 3D movies, film restoration, image processing and content format processing.

Capital Structure

No. of sharesAuthorised capital 15,00,000 equity shares of `10/- each

50,00,000 preference shares of `1/- each Issued, subscribed and paid-up capital 8,50,000 equity shares of `10/- each

12,00,000 preference shares of `1/- each Shareholding Reliance MediaWorks Entertainment Services Limited is a wholly owned subsidiary of our Company.

22. Reliance MediaWorks Theatres Limited (formerly, Adlabs Distributors and Exhibitors Limited) Corporate Information

Reliance MediaWorks Theatres Limited was incorporated in India under the Companies Act, on May 19, 2003 as Gemini Exhibitors Limited. It is a partner in a partnership firm Gold Adlabs which operates a multiplex in Pune.

Capital Structure

No. of equity shares Authorised capital 5,00,000 equity shares of `10/- each Issued, subscribed and paid-up capital 50,000 equity shares of `10/- each

Shareholding Reliance MediaWorks Theatres Limited is a wholly owned subsidiary of our Company.

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23. Reliance MediaWorks VFX Inc.

Corporate Information

Reliance Media Works VFX Inc. was incorporated in California, USA, under the applicable USA law on January 25, 2010. Reliance Media Works VFX Inc. is engaged in the business of post production services.

Capital Structure

No. of equity shares Authorised capital 200 equity shares of no par value Issued, subscribed and paid-up capital 100 equity shares of no par value

Shareholding Reliance Media Works VFX Inc. is a wholly owned subsidiary of Reliance MediaWorks (USA) Inc., which in turn is a wholly owned subsidiary of our Company.

24. Reliance MediaWorks (Malaysia) Sdn. Bhd.

Corporate Information

Reliance MediaWorks (Malaysia) Sdn. Bhd. was incorporated in Malaysia, under the applicable Malaysian law on April 18, 2008 as Reliance Big Entertainment Malaysia Sdn. Bhd. Reliance MediaWorks (Malaysia) Sdn. Bhd. is engaged in the business of exhibition through its subsidiary Big Cinemas Lotus Five Star Sdn. Bhd.

Capital Structure

No. of ordinary shares Authorised capital 50,00,000 ordinary shares of RM 1each Issued, subscribed and paid-up capital 50,00,000 ordinary shares of RM 1each

Shareholding Reliance MediaWorks (Malaysia) Sdn. Bhd. is a wholly owned subsidiary of Reliance MediaWorks (Mauritius) Limited which in turn is a wholly owned subsidiary of our Company.

25. Reliance MediaWorks (Mauritius) Limited

Corporate Information

Reliance MediaWorks (Mauritius) Limited was incorporated in Mauritius, under the applicable Mauritius law on March 20, 2008 as Adlabs (Mauritius) Limited. Reliance MediaWorks (Mauritius) Limited is engaged in the business of exhibition of films.

Capital Structure

No. of ordinary shares Authorised capital 1,000 ordinary shares of no par value Issued, subscribed and paid-up capital 1,000 ordinary shares of no par value

Shareholding Reliance MediaWorks (Mauritius) Limited is a wholly owned subsidiary of our Company.

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26. Reliance MediaWorks (UK) Limited

Corporate Information

Reliance MediaWorks (UK) Limited was incorporated in the UK, under the applicable UK law on May 19, 2006 as Adlabs Films (UK) Limited. Reliance MediaWorks (UK) Limited is engaged in the business of film exhibition in Netherlands/Benelux territory and in providing dedicated film and media services facility in London through iLab.

Capital Structure

No. of ordinary shares Authorised capital 10,000 ordinary shares of £1/- each Issued, subscribed and paid-up capital 10,000 ordinary shares of £1/- each

Shareholding Reliance MediaWorks (UK) Limited is a wholly owned subsidiary of our Company.

27. Reliance MediaWorks (USA) Inc.

Corporate Information

Reliance MediaWorks (USA) Inc. was incorporated in New Jersey, United States, under the applicable United States law on May 17, 2006 as Adlabs Films USA Inc. Reliance MediaWorks (USA) Inc. is engaged in the business of exhibition, film distribution and post production services through its subsidiaries. It is also engaged in the business of providing services such as film restoration, emergency image repair, digital blow-ups and DI enhancements and also operates digital restoration facilities through its subsidiaries Reliance Lowry Digital Imaging Services Inc. and Reliance Media Works VFX Inc. Capital Structure

No. of ordinary stock

Authorised capital 200 ordinary stock of no par value Issued, subscribed and paid-up capital 200 ordinary stock of no par value

Shareholding Reliance MediaWorks (USA) Inc. is a wholly owned subsidiary of our Company.

28. Reliance MediaWorks (Netherlands) B.V.

Corporate Information

Reliance MediaWorks (Netherlands) B.V. was incorporated in Netherlands, under the applicable Netherlands law on February 8, 2008 as Adlabs Films Netherlands B.V. Reliance MediaWorks (Netherlands) B.V. is engaged in the business of film distribution. Capital Structure

No. of equity shares Authorised capital 900 equity shares of Euro 100/- each Issued, subscribed and paid-up capital 180 equity shares of Euro 100/- each

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Shareholding Reliance MediaWorks (Netherlands) B.V. is a wholly owned subsidiary of our Company.

Joint Ventures

1. Divya Shakti Marketing Private Limited Corporate Information

Divya Shakti Marketing Private Limited was incorporated in India under the Companies Act on October 21, 1994. Divya Shakti Marketing Private Limited is engaged in the business of exhibition of films.

Capital Structure

No. of equity shares Authorised capital 2,10,000 equity shares of `10/- each Issued, subscribed and paid-up capital 2,00,000 equity shares of `10/- each

Shareholding Our Company holds 1,00,000 equity shares of Divya Shakti Marketing Private Limited, which constitutes 50% of interest in Divya Shakti Marketing Private Limited.

2. Swanston Multiplex Cinemas Private Limited Corporate Information

Swanston Multiplex Cinemas Private Limited was incorporated in India under the Companies Act on October 11, 2001. Swanston Multiplex Cinemas Private Limited is engaged in the business of exhibition of films.

Capital Structure

No. of equity shares Authorised capital 30,00,000 equity shares of ` 10/- each Issued, subscribed and paid-up capital 20,30,000 equity shares of ` 10/- each

Shareholding Our Company holds 10,15,000 equity shares of Swanston Multiplex Cinemas Private Limited, which constitutes 50% of interest in Swanston Multiplex Cinemas Private Limited. Interest of our Subsidiaries and Joint Ventures in our Company None of our Subsidiaries and Joint Ventures holds any Equity Shares in our Company. We have entered into certain transactions with our Subsidiaries and Joint Ventures. For details, please see the chapter entitled “Financial Statements” at page 188.

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OUR MANAGEMENT Board of Directors According to our Articles of Association, our Company is required to have not less than three Directors and not more than 12 Directors. Our Company currently has five Directors. The following table sets forth details regarding the Board of Directors of our Company as of the date of filing this Draft Letter of Offer: Name, Father’s Name, Designation, Term, DIN, Occupation, Nationality

and Address

Age (in years)

Other Directorships/Partnerships/Trusts in which our Director is a trustee

Gautam Doshi Father’s name: Bhailal Doshi Designation: Non-Executive Non-Independent Director Term: Liable to retire by rotation DIN: 00004612 Occupation: Service Nationality: Indian Address: 402, Hamilton Court Tagore Road, Santa Cruz (West) Mumbai 400 054.

59 Other directorships

1. Connect Infotain Private Limited; 2. Digital Bridge Foundation; 3. Piramal Life Sciences Limited; 4. Reliance Anil Dhirubhai Ambani Group

Limited; 5. Reliance Big TV Limited; 6. Reliance Broadcast Network Limited; 7. Reliance Communications Infrastructure

Limited; 8. Reliance Home Finance Limited; 9. Reliance Telecom Limited; 10. Sonata Investments Limited; 11. Sterlite Industries (India) Limited; and 12. Telecom Infrastructure Finance Private

Limited.

Partnerships 1. Gautam Doshi & Co.

Amit Khanna Father’s name: Jawaharlal Khanna Designation: Non-Executive Non-Independent Director Term: Liable to retire by rotation DIN: 00005430 Occupation: Media Professional Nationality: Indian Address: 301, Sea Star, 3rd Floor Balraj Sahani Marg, Juhu Mumbai 400 049.

61 Other directorships

1. Earth Communications Office - India Association;

2. Reliance BIG TV Limited; and 3. Reliance Entertainment Private Limited.

Proprietorships 1. Film Unit; and 2. Media Corp Trusts 1. Mumbai Academy of Moving Images

Sujal Shah Father’s name: Anil Shah

43 Other directorships

1. Amal Limited;

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Name, Father’s Name, Designation, Term, DIN, Occupation, Nationality

and Address

Age (in years)

Other Directorships/Partnerships/Trusts in which our Director is a trustee

Designation: Non-Executive Independent Director Term: Liable to retire by rotation DIN: 00058019 Occupation: Professional Nationality: Indian Address: 9, Ganesh Bhuvan, Natwar Nagar, Road no.2, Jogeshwari (East), Mumbai 400 060.

2. Amrit Banaspti Company Limited; 3. Gitanjali Gems Limited; 4. Hindoostan Mills Limited; 5. Hindoostan Technical Fabrics Limited; 6. i-Process Services (India) Private

Limited; 7. Keynote Corporate Services Limited; 8. Pramerica Trustees Private Limited; 9. Reliance Asset Reconstruction Company

Limited; 10. Rudolf Atul Chemicals Limited; 11. Sabero Organics Gujarat Limited; and 12. SSPA Consultants Private Limited Partnerships 1. SSPA & Associates; and 2. SSPA & Co.

Trusts 1. The Chamber of Tax Consultants

Anil Sekhri Father’s name: Avtarkrishan Sekhri Designation: Non-Executive Independent Director Term: Liable to retire by rotation DIN: 00506790 Occupation: Professional Nationality: Indian Address: 23-A, Krishna Kunj, Opp. Millat Nagar, Off New Link Road, Andheri (West), Mumbai 400 053.

53 Other directorships

1. ND S Art World Private Limited; 2. Reliance Broadcast Network Limited; 3. Sprint Tours & Travels Private Limited;

and 4. BIG RTL Broadcast Private Limited

Proprietorships

1. Anil Sekhri & Co.

HUF 1. Avtar HUF

Prasoon Joshi Father’s name: Devendra Kumar Joshi Designation: Non-Executive Independent Director Term: Liable to retire by rotation DIN: 01260545

44 Other directorships

1. McCann Erickson India Private Limited; 2. Result Services Private Limited; 3. Associated Corporate Consultants India

Private Limited; and 4. Reliance Broadcast Network Limited.

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Name, Father’s Name, Designation, Term, DIN, Occupation, Nationality

and Address

Age (in years)

Other Directorships/Partnerships/Trusts in which our Director is a trustee

Occupation: Service Nationality: Indian Address: 201-202, B Wing, Quantum Park Building, Union Park, Khar (West) Mumbai 400 052. Relationship with Other Directors None of our Directors are related to one another. Brief Biographies Gautam Doshi, aged 59 years, has been a Director since October 7, 2005. He holds a master’s degree in commerce from the University of Mumbai, Mumbai. He is also a fellow member of the Institute of Chartered Accountants of India. He has 35 years of experience in areas such as mergers and acquisitions, income-tax, international taxation, accounting, auditing, finance, banking, legal and general management. He was a senior partner in RSM & Co. and was a founder director of Ambit Corporate Finance Private Limited, a leading investment bank. He is currently the group managing director of the Reliance Group. Amit Khanna, aged 61 years, has been a Director since April 26, 2007. He holds a bachelor’s degree in arts from St. Stephen’s College, New Delhi. He has nearly 40 years of experience in areas such as film production, script writing, lyrics writing, direction, theatre, radio, films, journalism and television programming. He has held the position of the president, All India Film Producers Council, president, Film and Television Producers Guild of India Limited and vice-president, Association of Motion Picture and TV Program Producers and continues to be on the Council of Management of the Guild. He has also been on the governing council of the film institutes situated in Pune and Kolkata. He was the first Indian to serve on the jury of International Emmy. He has also been on the jury of various film festivals and awards in India and abroad. Besides serving on various international, government and trade organizations and institutions, he has also won several awards including three national film awards, Global Industry Leadership Award at Indian Film Festival of Los Angeles in the year 2009, First Leadership Award at Indian Film Festival of Houston in the year 2010 and a Life Time Achievement Award for Television (UPTRON) in the year 1985 and CMO Council Masterbrand in the year 2010. He is currently a chairman of the Convergence Committee of Federation of Indian Chambers of Commerce and Industry and National Committee of Media & Entertainment of Confederation of Indian Industry. He is also a member of Prime Minister of India’s Committee on Information, Communication & Entertainment, Confederation of Indian Industry’s Service Council and Advisory Board of the Forum d’Avignon, Paris. Further he is a president of Earth Communications Office, non-governmental organization. Sujal Shah, aged 43 years, has been a Director since April 26, 2007. He holds a bachelor’s degree in commerce from University of Mumbai, Mumbai. He is also a chartered accountant by qualification and is a member of the Institute of Chartered Accountants of India. He has approximately 20 years experience in the field of accounting and corporate consultancy practice including mergers and acquisitions, restructuring of companies, valuation of business/shares, due diligence review. He was the president of the Chamber of Tax Consultants for the year 2010-2011 and is a founder partner of SSPA & Co., Chartered Accountants. Anil Sekhri, aged 53 years, has been a Director since September 13, 2007. He holds a bachelor’s degree in commerce from Punjab University, Chandigarh. He is also a fellow member of the Institute of Chartered Accountants of India. He has over 26 years of experience in the areas such as accounting, taxation and legal matters with focus on media and entertainment sector. He is the founder of Anil Sekhri & Co., Chartered Accountants. Prasoon Joshi, aged 44 years, has been a Director since September 3, 2009. He holds a bachelor’s degree in

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science from University of Meerut, Meerut a master’s degree in science (physics) from Meerut University, Meerut and a master’s degree in business administration in marketing from the Institute of Management Technology, Ghaziabad. He has over 18 years of experience in areas such as advertising, song writing, poetry and communication. He has received approximately 400 national and international awards and honors, including the International Award Cannes Lions, Writer of the Year for five consecutive years, Creative Person of the Year 2005-2006, Ideator of the Year - Business Today in the year 2004 and the National Award in 2009. He has been on the jury at the Cannes Festival of Advertising in the year 2008-09 and was also ranked as the no.1 creative director in the Asia Pacific region in the year 2007-2008 by Asia Pacific MEDIA Publishers & Awards. He was designated a Young Global Leader by the World Economic Forum in the year 2006. He has also received awards such as Film Fare Awards in the years 2006 and 2008, Screen Awards in the years 2005 and 2008, Global Indian Film Awards in the year 2006, International Indian Film Academy award in the year 2007, Zee Cine Awards in the years 2007 and 2008, Shailendra Samman in the year 2009 for literary and social song writing. He was also shortlisted for the Oscars for the song “Rang de Basanti” and by NDTV Indian for the Year Special Award for Entertainment - 2008. He has also published books on poetry and prose. He is currently the executive chairman of McCann Worldgroup, India.

None of our Directors is or was a director of any listed company during the last five years preceding the date of filing of this Draft Letter of Offer, whose shares have been or were suspended from being traded on the BSE or the NSE, during the term of their directorship in such company. None of our Directors is or was a director of any listed company which has been or was delisted from any recognised stock exchange in India during the term of their directorship in such company. Remuneration of our Directors The remuneration paid to our Directors during the 12 months ended March 31, 2012 is as follows: 1. Executive Directors Our Company does not have any executive Director. Ashish Agarwal, though, is the Manager of our Company in terms of the Companies Act. 2. Non-Executive Directors The following table sets forth the details of sitting fees and commission paid to the non-executive Directors during the 12 months ended March 31, 2012:

(in `) Name 12 months ended March 31, 2012

Sitting fees Commission and others Gautam Doshi 20,000 Nil Amit Khanna 1,00,000 Nil Sujal Shah 1,25,000 Nil Anil Sekhri 1,25,000 Nil Prasoon Joshi 50,000 Nil Ajay Prasad * 30,000 Nil *Ajay Prasad has resigned w.e.f April 10, 2012. Except as stated in this section and the sitting fees paid in Fiscal 2011, no amount or benefit has been paid within the two preceding years or is intended to be paid or given to any of our Company’s officers including our Directors and key management personnel. None of the beneficiaries of loans, advances and sundry debtors are related to our Directors. Further, except statutory benefits and contractual payments like gratuity and leave encashments, upon termination of their employment in our Company or retirement, no officer of our Company, including our Directors and our key management personnel, are entitled to any benefits upon termination of employment. No loans have been availed by our Directors from our Company. Except Krishnanand Shetty, none of the key managerial personnel has availed any loan from our Company.

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Service Contracts with our Directors We have not entered into any service contracts with our Directors entitling them to any benefits on termination of employment or otherwise. Service Agreement with the Manager Pursuant to Board resolution dated July 1, 2011, Ashish Agarwal was appointed as a Manager of our Company with effect from July 1, 2011. A service agreement has been entered into by our Company with Ashish Agarwal on July 1, 2011 (Service Agreement) in relation to his appointment as the Manager with effect from July 1, 2011 for a period of five years i.e. upto June 30, 2016 with a remuneration of `24 lakhs per annum. The Service Agreement shall expire on June 30, 2016. Either party may terminate the Service Agreement with one month prior notice. His DIN is 01598849. Shareholding of Directors None of our Directors hold any Equity Shares in our Company. Borrowing Powers of our Board of Directors Pursuant to a resolution passed by the shareholders of our Company on October 25, 2007, and in accordance with the provisions of the Companies Act, the Board is authorised to borrow from time to time, any sum or sums of money, upon such terms and conditions and with or without security, in Indian/foreign currency, as our Board may in its discretion think fit, notwithstanding that the money or monies to be so borrowed by us (excluding the temporary loans obtained or to be obtained from our Company’s bankers in the ordinary course of business) together with the sums already borrowed, may exceed the aggregate of our paid-up capital and free reserves, provided the sums so borrowed shall not, at any time, exceed `5,00,000 lakhs. Corporate Governance Our Company is in compliance with the applicable corporate governance requirements, including under the Equity Listing Agreements, the Companies Act and other applicable laws and regulations. The corporate governance framework is based on an effective independent Board, separation of the Board’s supervisory role from the executive management team and constitution of committees of the Board, as required under law. Committees of the Board of Directors The Board has constituted committees of Directors, each of which functions in accordance with the relevant provisions of the Companies Act and the Equity Listing Agreements. These include, (i) Audit Committee, (ii) Shareholders and Investors’ Grievance Committee, (iii) Remuneration Committee, and (iv) Committee of Directors. The details of these committees are as follows A. Audit committee

The members of the Audit Committee are: 1. Sujal Shah; 2. Amit Khanna; 3. Anil Sekhri; 4. Gautam Doshi; and 5. Prasoon Joshi.

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The Audit Committee was re-constituted by a resolution passed by the Board of Directors in its meeting held on May 15, 2012. The terms of reference of the Audit Committee are as provided in Clause 49 of the Equity Listing Agreements, as well as Section 292A of the Companies Act, including overview of the accounting systems, correctness of the financial reporting and internal controls of our Company.

B. Shareholders and Investors’ Grievance Committee

The members of the Shareholders and Investors’ Grievance Committee are: 1. Gautam Doshi; 2. Amit Khanna; and 3. Prasoon Joshi.

The Shareholders and Investors’ Grievance Committee was re-constituted by a meeting of our Board held on October 22, 2009. The terms of reference of the Shareholders and Investors’ Grievance Committee include investigation into any matter relating to redressing shareholders’ and/or investors’ complaints pertaining to transfer of shares, non-receipt of balance sheet, non-receipt of declared dividend, duplicate share certificates and dematerialization or rematerialization of shares.

C. Remuneration Committee

The members of the Remuneration Committee are: 1. Anil Sekhri; 2. Gautam Doshi; 3. Amit Khanna; and 4. Sujal Shah. The Remuneration Committee was re-constituted by a circular resolution passed by the Board of Directors on June 9, 2010. The powers, duties and terms of reference of the Remuneration Committee include reviewing the overall compensation policy and structure, service agreements and other employment conditions for the members of the board.

D. Committee of Directors

The members of the Committee of Directors are:

1. Amit Khanna; 2. Sujal Shah; and 3. Anil Sekhri.

The above Committee of Directors was constituted by a meeting of our Board held on July 25, 2012. The powers, duties and terms of reference of the Committee of Directors include, inter alia, fixing a record date for the purpose of the issue, finalizing the size of issue and issue price, deciding the opening and closing dates for the rights issue, approving and adopting the draft letter of offer, letter of offer, application form and such other as documents as may be required, issuing and allotting the shares in one or more tranches and to do all such acts and deeds necessary or desirable in connection with or incidental to the issue of the shares and dispose of the balance unsubscribed portion of the right issue, if any, to our Promoters and/or any person(s) or institution(s) as it thinks most beneficial to our Company, subject to such regulations, if any, as may be applicable.

Interests of our Directors All of our Directors, including our independent Directors, may be deemed to be interested to the extent of

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fees, if any, payable to them for attending meetings of the Board or a committee thereof, as well as to the extent of other remuneration and reimbursement of expenses, if any, payable to them under our Articles of Association. All our non-executive Directors are entitled to sitting fees of `20,000 per meeting of the Board and `10,000 per meeting of the audit committee with effect from May 29, 2011. Our Directors may also be regarded as interested to the extent that they hold Equity Shares and to the extent of any dividend payable on such Equity Shares. Our Directors, including independent Directors, may also be regarded as interested in the Equity Shares held by the companies, firms and trust, in which they are interested as directors, members, partners or trustees. Our Directors, including independent Directors, may also be regarded as interested to the extent Equity Shares are allotted to entities in which they are interested as directors, members, partners or trustees. Further, Mrs. Geeta Serkhri, wife of Anil Sekhri, one of our Directors holds 1 (one) Equity Share. Anil Sekhri can be considered interested in our Company to extent of Equity Shares held by Mrs. Geeta Sekhri. All Directors may be deemed to be interested in the contracts, agreements / arrangements entered into or to be entered into by our Company with any company in which they hold directorships or any partnership firm in which they are partners as declared in their respective declarations. Except as otherwise stated in the chapter entitled “Financial Statements”, our Company has not entered into any contract, agreements or arrangements during the two years preceding the date of this Draft Letter of Offer, in which our Directors are interested directly or indirectly and no payments have been made to them in respect of such contracts, agreements or arrangements. Bonus or profit sharing plan for our Directors Our Company does not have any bonus or profit sharing plan for its Directors. Changes in our Board of Directors during the last three years:

Name Date of Appointment/ Change/ Cessation

Reason

Pradeep Shah September 3, 2009 Resignation Prasoon Joshi September 3, 2009 Appointment as additional director,

regularized on September 30, 2009 Ajay Prasad February 15, 2010 Appointment as additional director,

regularized on August 31, 2010 Darius Kakalia June 9, 2010 Resignation Ajay Prasad April 10, 2012 Resignation

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Management Organisation Structure

Key Managerial Personnel of our Company and our Subsidiaries Anil Arjun, Chief Executive Officer, aged 44 years, has been associated with our Company since October 2005. He joined Reliance Industries Limited in August 2000 and thereafter has been associated with various companies in the Reliance Group. He was deputed to our Company in October 2005 and was taken on the pay-roll of our Company in June 2009. He is a chartered accountant by qualification. Prior to joining Reliance Industries Limited, he held the position of the Vice President in ICICI Limited and has held several key positions in ICICI group for a period of eight years. He has approximately 19 years of experience. During the 12 months ended March 31, 2012, he was paid a gross compensation of `94.24 lakhs. Ashok Ganapathy, Chief Executive Officer - Exhibition, aged 46 years, joined our Company in May 2011. He holds a post graduate diploma in business management from Indian Institute of Management, Ahmedabad. Prior to joining our Company, he held the position of Senior Vice President - Operation with Spencer’s Retail Limited, RPG group and has also worked with Hindustan Unilever Limited. He has approximately 21 years of experience in sales, marketing, business management and operations. During the 12 months ended March 31, 2012, he was paid a gross compensation of `95.06 lakhs. Venkatesh Roddam, Chief Executive Officer – Film & Media Services, aged 48 years, joined our Company

Anil Arjun CEO

Film & Media Services CEO

Venkatesh Roddam

Exhibition Ops CEO

Ashok Ganapathy

Group Financial Controller

Mohan Umrotkar

India Business International Business

Film Post COO

Krishnanand Shetty

Production Services COO

Ashish Chakravorty

Creative Services (US & UK)

COO Naresh Malik

International Ops I Lab, London

RMW, Burbank

US

COO Rohit Sharma

COO Ashish Saksena

COO Preetham Rebello

CTO Anantha Krishnan

Planning & Projects Balaji Mudaliar

Human Resources Shiana Makhija

US Business Affairs Udaya Kumar

Corporate Communications Khushboo Benani

India Malaysia

Big Synergy Chairman&MD Siddhartha Basu

Board of Directors Ashish Agarwal Manager

Media & Creative Services

COO Naresh Malik

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in Jan 2012. He holds a degree in Masters of Business Administration. Prior to joining our Company, he held the position of Executive Director, with VenSat Technology Services Private Limited, and has also worked with companies like Annapurna Studios, Mahindra Satyam BPO & Deutsche Bank. He has approximately 25 years of experience in managing large scale operations, sales, marketing & business management. During the 12 months ended March 31, 2012, he was paid a gross compensation of `34.80 lakhs. Krishnanand Shetty, Chief Operating Officer – Film Post, aged 59 years, joined our Company in April 1999. He holds a bachelor's degree in science from University of Mumbai, Mumbai. Prior to joining our Company he has worked with Quality Cine Lab. He has approximately 35 years of experience in the media and entertainment industry. During the 12 months ended March 31, 2012, he was paid a gross compensation of `76.82 lakhs. Ashish Chakravorty, Chief Operating Officer - Production Services, aged 47 years, joined our Company in January 2008. He holds a bachelor's degree in economics from University of Mumbai, Mumbai. Prior to joining our Company he has worked with Zee Entertainment Enterprises Limited and Universal Music. He has approximately 23 years of experience in various fields such as marketing, advertising and music. During the 12 months ended March 31, 2012, he was paid a gross compensation of `77.26 lakhs. Naresh Malik, Chief Operating Officer – Creative Services, aged 45 years, joined our Company in January 2010. He holds a bachelor’s degree in engineering (electronics and communication) from Institution of Engineers, Chennai. Prior to joining our Company he has worked with, inter alia, Century Communication Limited - Pixion, Ideal System Asia Pacific and Grass Valley Group and has held the position of Chief Executive Officer in Prime Focus World. He has approximately 20 years of experience in the management and post production business. During the 12 months ended March 31, 2012, he was paid a gross compensation of `94.43 lakhs. Mohan Umrotkar, Group Financial Controller, aged 38 years, joined our Company in May 2008. He is a chartered accountant by qualification. Prior to joining our Company, he was with C.C Choksi & Company. He has approximately 15 years of experience. He heads our finance and accounts division. During the 12 months ended March 31, 2012, he was paid a gross compensation of `60.37 lakhs. Anantha Krishnan, Chief Technology Officer, aged 48 years, joined our Company in July 2007. He holds a diploma from Institution of Engineers (India), Kolkata. Previously he has worked with companies such as Prasad Corporation Limited, Crest Communications Limited and has held the position of Head - Technical in Century Communication Limited, Pixion. He has approximately 27 years of work experience in technical development and information technology infrastructure. During the 12 months ended March 31, 2012, he was paid a gross compensation of `64.93 lakhs. Shiana Makhija, Chief Human Resources Officer, aged 46 years, joined our Company in January 2011. She holds a bachelor's degree in arts from University of Mumbai, Mumbai. She also holds masters’ degree in arts (social work) from Tata Institute of Social Sciences. She has previously worked with companies such as Blue Star Limited, Johnson Controls India Private Limited, MIRC Electronics Limited and Reliance Capital Limited and has held the position of Senior Vice President – Human Resources at Reliance Capital Ltd. She has approximately 19 years of experience in the field of human resources. During the 12 months ended March 31, 2012, she was paid a gross compensation of `61.30 lakhs. Ashish Agarwal, Company Secretary and Manager, aged 38 years, joined our Company in July 2011. He holds a bachelor's degree in commerce and has obtained a degree in law from Maharshi Dayanand Saraswati University, Ajmer, Rajasthan. He is also a member of the Institute of Company Secretaries of India. Prior to our Company he has worked with Aditya Birla Nuvo Limited. He has approximately 13 years of experience in legal and secretarial area. During the 12 months ended March 31, 2012, he was paid a gross compensation of `16.80 lakhs. Siddhartha Basu, aged 57 years, was appointed as Chairman and Managing Director of Big Synergy Media Limited in July 2008 for a period of three years and was re-appointed on July 1, 2011 for a further period of three years. He holds a bachelor's degree in English literature from St. Stephen's College, New Delhi and holds a master’s degree in arts from the Arts Faculty of Delhi University, New Delhi. Prior to Big Synergy Media Limited he has worked with Taj Group. In 1988 along with his wife Anita Basu, he set up Synergy

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Communications Private Limited (now known as BIG Synergy Media Limited), a television production company, which partnered with our Company in 2007. He has approximately 32 years of experience in television content production including shows like Duss Ka Dum, India’s Got Talent, Aap Ki Kachehri, Sach Ka Saamna and Kaun Banega Crorepati. During the 12 months ended March 31, 2012, he was paid a gross compensation of `30.00 lakhs. Except as stated above, the key management personnel are permanently employed with our Company/its Subsidiary as of the date of this Draft Letter of Offer. None of the key management personnel are related to each other. Brief details of the general employment contract of key management personnel of our Company Our Company has entered into general employment contracts with our key management personnel. A summary of the terms of these general employment contracts is set out below: The key management personnel are subject to an initial probation period of six months. Either party may terminate the contract during this period, after giving a notice for a period of 15 days, without assigning any reason. The appointment and continuation of the key management personnel is subject to them being found medically fit to be employed. The age of retirement is 58 years. The key management personnel is prohibited from disclosing any secret, processes, methods, designs and any intellectual property of our Company along with any other information relating to our Company gathered during the course of their employment. Any inventions, discoveries, intellectual property designed or developed would become our Company’s exclusive property. After completion of probation period, either party may terminate the contract after giving a notice of one month. Our Company may terminate the contract, without a notice, if the particulars provided by the applicant in the application are incomplete or incorrect. Also, if there is any misconduct or fraudulent activity on part of the employee, the services can be terminated. Brief details of the employment contract of Siddhartha Basu Big Synergy Media Limited has entered into an employment contract dated July 1, 2011 with Siddhartha Basu re-appointing him chairman and managing director of Big Synergy Media Limited for a period of three years with effect from July 1, 2011 with an annual remuneration not exceeding `30 lakhs. In terms of the contract, Siddhartha Basu shall not, without the written consent of the company, be employed or be financially interested in or act as an officer or adviser to any business substantially similar to or competing with any business carried out by the company. Further, he is prohibited from disclosing any confidential information concerning the company gathered during the course of his employment. Either party may terminate the contract after giving a notice of three months. The contract may be terminated by the board of directors’ of Big Synergy Media Limited by passing a resolution in event of breach of any terms or conditions by Siddhartha Basu. Further the contract shall automatically terminate in case Siddhartha Basu shall cease to be a director of the company for any reason whatsoever. Shareholding of key managerial personnel Except Krishnanand Shetty and Ashish Chakravorty, who hold 100 Equity Shares and 150 Equity Shares, respectively, in our Company, none of our key managerial personnel hold Equity Shares of our Company. Interest of Key Managerial Personnel Except to the extent of their shareholding in our Company, and remuneration or benefits to which they are entitled as per the terms of their appointment and reimbursement of expenses incurred by them in the ordinary course of business, our Company’s key managerial personnel do not have any other interest in our Company.

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Bonus or profit sharing plan of the key management personnel Siddhartha Basu, key management personnel of our Subsidiary namely Big Synergy Media Limited, is entitled to a bonus of `0.74 lakhs during the period in which Big Synergy Media Limited suffers loss and 5% of the net profit as computed in terms of the applicable provision of the Companies Act including salary, bonus, performance incentive, and commission etc during the period the company is profitable. Except as disclosed above, none of the key management personnel are entitled to any profit sharing plan. Changes in the key management personnel The changes in the key management personnel in the last three years are as follows:

Name Designation Date of change Reason for change

Naresh Malik Chief Operating Officer - Creative Services January 18, 2010

Appointment

Shiana Makhija Chief Human Resources Officer January 3, 2011 Appointment Ashok Ganapathy

Chief Executive Officer – Exhibition May 5, 2011 Appointment

Kirti Desai Company Secretary and Manager May 15, 2011 Resignation Madhulika Singh

Manager May 28, 2011 Appointment

Madhulika Singh

Manager July 1, 2011 Resignation

Ashish Agarwal Company Secretary and Manager July 1, 2011 Appointment Venkat Devarajan

Chief Financial Officer December 16, 2011

Resignation

Tushar Dhingra Chief Operating Officer – Exhibition (North, East & Central)

December 31, 2011

Resignation

Shankar Dutta President – Motion Pictures & Allied Services December 31, 2011

Resignation

Venkatesh Roddam

Chief Executive Officer – Film & Media Services January 2, 2012 Appointment

Employees Employee Stock Option Scheme The shareholders of our Company pursuant to a resolution passed at the AGM held on August 31, 2010 have in terms of section 81(1A) of the Companies Act and the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, accorded their consent to our Board of Directors to introduce and implement the Reliance MediaWorks Employee Stock Option Scheme (“ESOS Scheme”). As on the date of this Draft Letter of Offer, our Company has not granted any ESOS Securities under the aforesaid scheme. Payment or Benefit to Officers of our Company (non salary related) Except as stated above, no amount or benefit (non salary related) has been paid within the two preceding years or is intended to be paid or given to any of our Company’s officers including our Directors and key management personnel, including benefits in kind for all capacities and contingent or deferred compensation. Further, except statutory benefits upon termination of their employment in our Company or retirement, no officer of our Company, including our Directors and our key management personnel, are entitled to any benefits upon termination of employment.

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OUR PROMOTER AND PROMOTER GROUP

Promoters Reliance Land Private Limited and Reliance Capital Limited are the Promoters of our Company. 1. Reliance Land Private Limited Reliance Land Private Limited was incorporated as Reliance Homes Limited, a public limited company, under the Companies Act on December 23, 1993. The company received a certificate of commencement of business on January 3, 1994. Subsequently, the name of the company was changed to Reliance Land Limited pursuant to which a fresh certificate of incorporation dated May 25, 1995 was issued by the Registrar of Companies. Pursuant to the conversion of the company into a private limited company, the name was changed to Reliance Land Private Limited on September 7, 2001.

Reliance Land Private Limited is involved in the business of real estate.

The registered office of Reliance Land Private Limited is situated at H Block, 1st Floor, Dhirubhai Ambani Knowledge City, Navi Mumbai 400 710.

Board of directors

The board of directors of Reliance Land Private Limited comprises of:

1. Achuthan Kothandath. 2. Sandeep Shashidhar Phanasgaonkar; and 3. Vinod Kumar Tripathi. Shareholding pattern Shareholding pattern of Reliance Land Private Limited as of March 31, 2012 is as follows:

Name of Shareholder No. of Equity Shares Held % of shareholding Reliance Capital Limited 50,00,000 50.00 Reliance Share & Stock Brokers Private Limited

50,00,000 50.00

Total 1,00,00,000 100.00 Unconsolidated Financial performance (In ` lakhs, except share data)

Particulars As at and for the nine month period ended March 31,

2010(1)

As at and for the year ended March

31, 2011

As at and for the year ended March

31, 2012

Sales & Other Income 31.34 41.47 17.11PAT (185.09) 115.29 (157.20) Equity Capital 1,000.00 1,000.00 1,000.00 Reserves 33,887.54 30,852.83 37,195.62 EPS (in `)(2) (2.45) 1.15 (1.57) Net asset value per share (in `)(3) 348.88 318.53 381.96 (1) The financial year of Reliance Land Private Limited beginning on July 1st of every year and ending on March 31st of the next year was changed to begin on April 1st of every year and end on March 31st of the next year, pursuant to a resolution dated March 12, 2010 passed by its Board of Directors. Accordingly, the financial year 2010 commenced on July 1st 2009 and was a nine month period ending on March 31, 2010.

(2) Excluding preference dividend (3) Excluding reserves earmarked for preference share redemption

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Promoters of Reliance Land Private Limited

Reliance Capital Limited is the promoter of Reliance Land Private Limited. The directors of Reliance Capital Limited are as follows: 1. Anil Dhirubhai Ambani; 2. Amitabh Jhunjhunwala; 3. Rajendra Prabhakar Chitale; 4. Chandra Prakash Jain; 5. Dr. Bidhubhusan Samal; and 6. Vijayendra Nath Kaul

There has been no change in the control or the management of Reliance Land Private Limited in the three years preceding the date of this Draft Letter of Offer.

Our Company confirms that the permanent account number, bank account number, company registration number and the address of the Registrar of Companies where Reliance Land Private Limited is registered shall be submitted to the Stock Exchanges at the time of filing this Draft Letter of Offer. 2. Reliance Capital Limited Reliance Capital Limited was incorporated as Reliance Capital & Finance Trust Limited under the Companies Act on March 5, 1986. The company received a certificate of commencement of business on March 27, 1986. Subsequently, the name of the company was changed to Reliance Capital Limited, pursuant to which a fresh certificate of incorporation dated January 6, 1995 was issued by the Registrar of Companies.

Reliance Capital Limited is a non-banking financial company registered with the Reserve Bank of India under section 45-IA of the RBI Act, 1934. Reliance Capital Limited has interests in asset management, mutual funds, portfolio management services, pension funds, life and general insurance, private equity and proprietary investments, stock broking and depository services, investment banking, wealth management, home and commercial finance, financial products distribution, venture capital, exchanges, asset reconstruction and other activities in financial services.

The registered office of Reliance Capital Limited is situated at H Block, 1st Floor, Dhirubhai Ambani Knowledge City, Navi Mumbai 400 710, India.

Board of directors

The board of directors of Reliance Capital Limited comprises of:

1. Anil Dhirubhai Ambani; 2. Amitabh Jhunjhunwala; 3. Rajendra Prabhakar Chitale; 4. Chandra Prakash Jain; 5. Dr. Bidhubhusan Samal; and 6. Vijayendra Nath Kaul

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Shareholding Pattern

The shareholding pattern of Reliance Capital Limited as of June 30, 2012 is as follows:

Category

Code ( I )

Category of Shareholder

( II )

No of Shareholder

s ( III )

Total No of Shares ( IV )

Number of shares held

in dematerilise

d Form ( V )

Total Sharehold

ing as percentage of total number of shares

Shares Pledged

or otherwis

e encumbe

red

As a percentage of (A+B)

( VI )

As a percenta

ge of (A+B+C)

( VII )

(A) Shareholding of Promoter and Promoter Group

(1) Indian

(a) Individuals/Hindu Undivided Family 9 11,65 ,983 11,65 ,983 0.48 0.47

(b) Central Government/State Governments

- - - - -

(c) Bodies Corporate 9 13,02,16,289 13,02,16,289 53.07 53.01

(d) Financial Institutions/Banks - -

- - -

(e) Any Other (Specify) 1 16,00,000 16,00,000 0.65 0.65

Sub -Total (A)(1) 19 13,29,82,272 13,29,82,272 54.19 54.14

(2) Foreign

(a)

Individuals(Non-Resident Individuals/Foreign Individuals)

- - -

- -

(b) Bodies Corporate - - -

- -

(c) Institutions - - -

- -

(d) Qualified Foreign Investor - -

- - -

(e) Any Other (Specify) - - -

- -

Sub -Total (A)(2) - - -

- -

Total shareholding of Promoter and Promoter Group (A)=(A)(1)+(A)(2)

19 13,29,82,272 13,29,82,272 54.19 54.14

(B) Public Shareholding (1) Institutions (a) Mutual Funds /UTI 191 27,01,008 26,36,701 1.10 1.10

(b) Financial Institutions/Banks 285 4,25,050 4,10,322 0.17 0.17

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Category

Code ( I )

Category of Shareholder

( II )

No of Shareholder

s ( III )

Total No of Shares ( IV )

Number of shares held

in dematerilise

d Form ( V )

Total Sharehold

ing as percentage of total number of shares

Shares Pledged

or otherwis

e encumbe

red

As a percentage of (A+B)

( VI )

As a percenta

ge of (A+B+C)

( VII )

(c) Central Government/State Governments

53 48,857 5,145 0.02 0.02

(d) Venture Capital Funds - - -

- -

(e) Insurance Companies 18 1,09,16,494 1,09,16,339 4.45 4.44

(f) Foreign Institutional Investors 487 4,92,06,627 4,92,00,802 20.05 20.03

(g) Foreign Venture Capital Investors - -

- - -

(h) Qualified Foreign Investor - -

- - -

(I) Any Other (Specify) - - -

- -

Sub -Total (B)(1) 1,034 6,32,98,036 6,31,69,309 25.80 25.77

(2) Non-Institutions (a) Bodies Corporate 6,075 88,02,693 87,19,640 3.59 3.58

(b)

i. Individual shareholders holding nominal share capital up to Rs.1Lakh.

11,79,955 3,64,19,355 3,12,27,294 14.84 14.83

ii. Individual shareholders holding nominal share capital in excess of Rs.1Lakh.

53 25,95,648 25,73,148 1.06 1.06

(c) Qualified Foreign Investor - - - - -

(d) Any Other (Specify) 1 NRIs/OCBs 13,723 12,88,716 10,83,386 0.53 0.52 Sub -Total (B)(2) 11,99,806 4,91,06,412 4,36,03,468 20.01 19.99

Total Public Shareholding B=(B)(1)+(B)(2)

12,00,840 11,24,04,448 10,67,72,777 45.81 45.76

TOTAL (A) +(B) 12,00,859 24,53,86,720 23,97,55,049 100.00 99.90

(C)

Shares held by Custodians and against which Depository Receipts have been issued

1 Promoter and Promoter Group 0 0 0 0.00 0.00

2 Public 1 2,46,080 2,46,080 0.00 0.10

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Category

Code ( I )

Category of Shareholder

( II )

No of Shareholder

s ( III )

Total No of Shares ( IV )

Number of shares held

in dematerilise

d Form ( V )

Total Sharehold

ing as percentage of total number of shares

Shares Pledged

or otherwis

e encumbe

red

As a percentage of (A+B)

( VI )

As a percenta

ge of (A+B+C)

( VII ) Sub - Total (C ) 1 2,46,080 2,46,080 0.00 0.10

GRAND TOTAL (A)+(B)+(C) 12,00,860 24,56,32,80

0 24,00,01,129 100.00 100.00

Unconsolidated Financial Performance The brief financial details of Reliance Capital Limited derived from its audited financial statements, prepared on a standalone basis, are set forth below:

(In ` lakhs, except share data) Particulars As at and for

the year ended March 31, 2010

As at and for the year ended March 31, 2011

As at and for the year ended March 31, 2012

Sales & Other Income 2,38,988.00 1,93,401.10 3,31,733.53 PAT 33,942.00 22,927.00 51,924.58 Equity Capital 24,616.00 24,616.00 24,616.00 Reserves (excluding revaluation reserves)* 6,71,290.00 6,78,153.00 10,79,827.73 EPS (in `) 13.82 9.33 21.14 Book value per share (in `) 280.32 283.28 449.69 * Reserves are net of miscellaneous expenditure to the extent not written off.

There has been no change in the control or the management of Reliance Capital Limited in the three years preceding the filing of this Draft Letter of Offer.

Our Company confirms that the permanent account number, bank account number, company registration number and the address of the Registrar of Companies where Reliance Capital Limited is registered shall be submitted to the Stock Exchanges at the time of filing this Draft Letter of Offer. Promoters of Reliance Capital Limited The promoters of Reliance Capital Limited are as follows: Individual promoters: 1. Kokila D. Ambani; 2. Anil D. Ambani; 3. Tina A. Ambani; 4. Jaianmol A. Ambani; and 5. Jaianshul A. Ambani (through father and natural guardian Anil D. Ambani). Corporate promoters: 1. AAA Enterprises Private Limited; 2. AAA Infrastructure Consulting & Engineers Private Limited; 3. Sonata Investments Limited;

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4. Reliance ADA Group Trustees Private Limited - Trustees of RCAP ESOS Trust; and 5. Reliance Innoventures Private Limited. Natural person in control of the corporate promoters: The natural person in control of the corporate promoters of Reliance Capital Limited is Anil D. Ambani. Interests of Promoters Our Promoters are interested in our Company to the extent of their shareholding and dividend received. For details on the shareholding of our Promoters in our Company, please see the chapter entitled “Capital Structure” at page 69. Our Promoters do not have any interest in the property acquired by our Company within two years preceding the date of this Draft Letter of Offer or proposed to be acquired by our Company. Reliance Capital Limited has provided a corporate guarantee in favour of Axis Trustee Services Limited for an amount of `35,000 lakhs for the Non Convertible Debentures issued by our Company to Yes Bank for an aggregate amount of `35,000.00 lakhs. As of June 30, 2012, the said corporate guarantee is valid and subsisting. For further details in relation to Non Convertible Debentures issued by our Company, please see the chapter entitled “Financial Indebtedness” at page 475. Payment of benefits to our Promoters or Promoter Group Except as stated in the chapter entitled “Financial Statements” at page 188, there has been no payment of benefits to our Promoters or Promoter Group during the two years preceding the filing of this Draft Letter of Offer. Confirmations None of our Promoters have been declared as a willful defaulter by the RBI or any other government authority and there are no violations of securities laws committed by our Promoters in the past and no proceedings for violation of securities laws are pending against them. Further, none of our Promoters or our Promoter Group or our Directors has been restrained from accessing the capital markets for any reasons by SEBI or any other entity. Companies with which our Promoters have disassociated in the last three years Except as disclosed below, our Promoters have not disassociated from any company during the preceding three years from the date of this Draft Letter of Offer: Reliance Capital Limited has disassociated from Medybiz Private Limited, Net Logistics Private Limited, Reliance Capital Services Private Limited and Reliance Infrastructure Finance Private Limited as a result of sale of shares held by Reliance Capital Limited in these companies. Reliance Commercial Finance Private Limited and Viscount Management Services (Alpha) Limited have been amalgamated with Reliance Capital Limited. Change in the management and control of our Company Other than as disclosed in this Draft Letter of Offer, there has been no change in the management and control of our Company. Promoter Group In addition to our Promoters, the following persons form part of our Promoter Group i.e. part of the Reliance Group:

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1. AAA Enterprises Private Limited; 2. AAA Infrastructure Consulting & Engineers Private Limited; 3. Adhar Project Management & Consultancy Private Limited; 4. Ammolite Holdings Limited; 5. Ashadeep Properties Private Limited; 6. Indian Agri Services Private Limited; 7. QOPPA Trading Private Limited; 8. Quant Broking Private Limited; 9. Quant Capital Advisors Private Limited; 10. Quant Capital Finance and Investments Private Limited; 11. Quant Capital Private Limited; 12. Quant Commodities Private Limited; 13. Quant Commodity Broking Private Limited; 14. Quant Investment Services Private Limited; 15. Quant Securities Private Limited; 16. QCAP Trade Private Limited (formerly Valankulam Investments and Trading Private Limited) 17. Reliance Alternative Investments Services Private Limited; 18. Reliance Asset Management (Malaysia ) Sdn. Bhd.; 19. Reliance Asset Management (Mauritius) Ltd.; 20. Reliance Asset Management (Singapore) Pte Limited; 21. Reliance Asset Reconstruction Co. Limited; 22. Reliance Broadcast Network Limited; 23. Reliance Capital (Singapore) Pte. Limited; 24. Reliance Capital Asset Management (UK) Plc.; 25. Reliance Capital Asset Management Limited; 26. Reliance Capital Pension Fund Limited; 27. Reliance Capital Trustee Co. Limited; 28. Reliance Commodities Limited; 29. Reliance Composite Insurance Broking Limited 30. Reliance Consultants (Mauritius) Ltd; 31. Reliance Equities International Private Limited; 32. Reliance Equity Advisors (India) Limited; 33. Reliance Exchangenext Limited; 34. Reliance Financial Limited; 35. Reliance General Insurance Company Limited; 36. Reliance Gilts Limited; 37. Reliance Home Finance Limited (formerly Reliance Home Finance Private Limited); 38. Reliance Innoventures Private Limited; 39. Reliance Investment Banking Services Limited; 40. Reliance Life Insurance Company Limited; 41. Reliance Money Express Limited; 42. Reliance Money Precious Metals Private Limited (formerly Reliance Capital Research Private

Limited); 43. Reliance Net Limited; 44. Reliance Realty Private Limited; 45. Reliance Securities Limited; 46. Reliance Share & Stock Brokers Private Limited; 47. Reliance Spot Exchange Infrastructure Limited; 48. Reliance Venture Asset Management Private Limited; 49. Reliance Wealth Management Limited; and 50. Viscount Management Services Limited.

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OUR GROUP COMPANIES Unless otherwise stated, none of the companies forming part of Group Companies is a sick company under the meaning of SICA and none of them are under winding up. Further, except Reliance Broadcast Network Limited, all our Group Companies are unlisted companies and they have not made any public issue of securities in the preceding three years. The Group Companies of our Company are as follows: Sr. No.

Name of the company

1. Adhar Project Management & Consultancy Private Limited 2. Ammolite Holdings Limited 3. Indian Agri Services Private Limited 4. QOPPA Trading Private Limited 5. Quant Broking Private Limited 6. Quant Capital Advisors Private Limited 7. Quant Capital Finance and Investments Private Limited 8. Quant Capital Private Limited 9. Quant Commodities Private Limited

10. Quant Commodity Broking Private Limited 11. Quant Investment Services Private Limited 12. Quant Securities Private Limited 13. QCAP Trade Private Limited (formerly Valankulam Investments and Trading Private Limited) 14. Reliance Alternative Investments Services Private Limited 15. Reliance Asset Management (Malaysia) Sdn. Bhd. 16. Reliance Asset Management (Mauritius) Limited 17. Reliance Asset Management (Singapore) Pte Limited 18. Reliance Asset Reconstruction Company Limited 19. Reliance Broadcast Network Limited 20. Reliance Capital (Singapore) Pte. Limited 21. Reliance Capital Asset Management (UK) Plc. 22. Reliance Capital Asset Management Limited 23. Reliance Capital Infrastructure Partners 24. Reliance Capital Partners 25. Reliance Capital Pension Fund Limited 26. Reliance Capital Trustee Co. Limited 27. Reliance Commodities Limited 28. Reliance Composite Insurance Broking Limited 29. Reliance Consultants (Mauritius) Ltd. 30. Reliance Equities International Private Limited 31. Reliance Equity Advisors (India) Limited 32. Reliance Exchangenext Limited 33. Reliance Financial Limited 34. Reliance General Insurance Company Limited 35. Reliance Gilts Limited 36. Reliance Home Finance Limited (formerly Reliance Home Finance Private Limited) 37. Reliance Investment Banking Services Limited 38. Reliance Life Insurance Company Limited 39. Reliance Money Express Limited 40. Reliance Money Precious Metals Private Limited (formerly Reliance Capital Research Private

Limited) 41. Reliance Securities Limited 42. Reliance Share & Stock Brokers Private Limited 43. Reliance Spot Exchange Infrastructure Limited 44. Reliance Venture Asset Management Private Limited 45. Reliance Wealth Management Limited 46. Viscount Management Services Limited

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Top five Group Companies The details of one listed Group Company and the top four Group Companies on basis of turnover are set forth below: 1. Reliance Broadcast Network Limited

Corporate Information

Reliance Broadcast Network Limited (CIN L64200MH2005PLC158355) was incorporated on December 27, 2005 as Reliance Unicom Limited under corporate identification number CIN U64200MH2005PLC158355 and obtained the certificate of commencement of business on February 13, 2006. The name was changed to Big Radio Limited vide a fresh certificate of incorporation consequent upon change of name dated October 6, 2006 issued by the Registrar of Companies. The name of the company was subsequently changed to Reliance Unicom Limited vide a fresh certificate of incorporation consequent upon change of name dated September 18, 2007 issued by the Registrar of Companies. The name of the company was again changed to Reliance Media World Limited vide the fresh certificate of incorporation consequent upon change of name dated July 22, 2009 issued by the registrar. Subsequently the company’s name was changed to Reliance Broadcast Network Limited vide the fresh certificate of incorporation consequent upon change of name dated June 17, 2010 issued by the registrar of the companies. Reliance Broadcast Network Limited is a multi-media entertainment conglomerate with play across radio, television, intellectual properties and out of home. It is part of the Reliance Group and specializes in creating and executing integrated media solutions for brands. Interest of our Promoter

Reliance Capital Limited and Reliance Land Private Limited hold 9.27% and 44.57% interest in Reliance Broadcast Network Limited, respectively as on July 6, 2012.

Financial Information

The brief financial details of Reliance Broadcast Network Limited derived from its audited standalone financial statements for financial year September 30, 2010 (i.e. April 1, 2010 to September 30, 2010), March 31, 2011 (i.e. October 1, 2010 to March 31, 2011) and March 31, 2012 (i.e. April 1, 2011 to March 31, 2012) are set forth below:

(` in lakhs, except share data)

Particulars Six month period ended September 30, 2010(1)

Six month period ended March 31, 2011(2)

As at and for the year ended March 31, 2012

Equity Capital 3,972.56 3,972.56 3,972.56 Reserves (excluding revaluation reserves)

20,660.89 19,511.22 17558.67

Sales & Other Income 11,050.78 14,082.96 30,869.11 Profit After Tax (2,941.73) (1,149.68) (1952.53) EPS/ Diluted EPS (in `) (6.35) (1.45) (2.46) Book value (in `) 31.00 29.56 27.10 (1) Pursuant to the board resolution dated October 21, 2010, Reliance Broadcast Network Limited closed its books of accounts as of

September 30, 2010 and accordingly the financial year was of six months ending September 30, 2010. (2) Pursuant to the board resolution dated May 5, 2011, Reliance Broadcast Network Limited closed its books of accounts as of

March 31, 2011 and accordingly the financial year was of six months ending March 31, 2011.

Share Price Information Equity Shares of Reliance Broadcast Network Limited are listed on BSE and NSE. The monthly high and low of the closing market price of the equity shares of Reliance Broadcast Network Limited having a face value of `5/- each for the last six months in NSE and BSE is as follows:

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BSE

Month Monthly High of closing price in ` Monthly Low of closing price in `

January 2012 55.45 48.65 February 2012 62.60 51.45 March 2012 57.40 48.80 April 2012 58.35 49.70 May 2012 50.20 36.25 June 2012 51.10 38.45

The market capitalisation of Reliance Broadcast Network Limited on the closing price of `51.10/- per equity share on the BSE as on June 30, 2012 was `40,599.54 lakhs. NSE

Month Monthly High of closing price in ` Monthly Low of closing price in `

January 2012 55.20 48.60 February 2012 62.45 51.45 March 2012 57.50 49.00 April 2012 58.45 49.45 May 2012 50.15 36.30 June 2012 51.00 38.70

The market capitalisation of Reliance Broadcast Network Limited on the closing price of `51.00/- per equity share on the NSE as on June 30, 2012 was `40,520.09 lakhs. Changes in capital structure There have been no changes in capital structure of Reliance Broadcast Network Limited during the preceding six months. Reliance Broadcast Network Limited has made no other public or rights issue in the last three years. 2. Reliance Life Insurance Company Limited

Corporate Information

Reliance Life Insurance Company Limited was incorporated in India, under the Companies Act on May 14, 2001. Reliance Life Insurance Company Limited has been granted a license by Insurance Regulatory and Development Authority on January 03, 2002 for carrying life insurance, health insurance and annuity business.

Interest of our Promoter

Reliance Capital Limited holds 38.78% interest in Reliance Life Insurance Company Limited. Financial Information

The brief financial details of Reliance Life Insurance Company Limited derived from its audited standalone financial statements for financial years 2010, 2011 and 2012 are set forth below:

(` in lakhs, except share data)

175

Particulars As at and for the

financial year 2010 As at and for the

financial year 2011 As at and for the

financial year 2012 Equity Capital 1,16,464.49 1,16,584.49 11,9632.35 Reserves (excluding revaluation reserves) (86,209.52) (87,285.30) (29,044.23)

Sales & Other Income* 6,60,489.62 6,57,114.64 5,49,761.92 Profit After Tax (28,378.84) (12,929.10) 37,257.13 EPS/ Diluted EPS (in `) (2.44) (1.11) 3.14 Net asset value per share (in `) 2.60 2.51 7.57 * Sales and other income include gross premium 3. Reliance Capital Asset Management Limited

Corporate Information

Reliance Capital Asset Management Limited was incorporated in India, under the Companies Act on February 24, 1995. Reliance Capital Asset Management Limited is engaged in the business of providing investment management and advisory services to mutual funds.

Interest of our Promoter

Reliance Capital Limited holds 92.94% interest in Reliance Capital Asset Management Limited.

Financial Information

The brief financial details of Reliance Capital Asset Management Limited derived from its audited standalone financial statements for financial years 2010, 2011 and 2012 are set forth below:

(` in lakhs, except share data)

Particulars As at and for the

financial year 2010 As at and for the

financial year 2011 As at and for the

financial year 2012 Equity Capital 1051.00 1,051.00 1,051.00 Reserves (excluding revaluation reserves)

1,02,810.08 1,10,159.08 119,025.39

Sales & Other Income 65,424.80 69,925.10 64,229.00 Profit After Tax 19,512.55 26,127.33 27,610.90 EPS/ Diluted EPS (in `) 185.66 248.59 262.71 Net asset value per share (in `) 988.21 1,058.14 1,142.50 4. Reliance General Insurance Company Limited Corporate Information

Reliance General Insurance Company Limited was incorporated in India, under the Companies Act on August 17, 2000. Reliance General Insurance Company Limited is engaged in the business of providing general insurance services.

Interest of our Promoter

Reliance Capital Limited holds 96.46% interest in Reliance General Insurance Company Limited.

Financial Information

The brief financial details of Reliance General Insurance Company Limited derived from its audited unconsolidated financial statements for financial years 2010, 2011 and 2012 are set forth below:

(` in lakhs, except share data)

176

Particulars As at and for the

financial year 2010 As at and for the

financial year 2011 As at and for the

financial year 2012 Equity Capital 11,522.40 11,667.30 12,119.33 Reserves (excluding revaluation reserves) 67,594.68 50,489.61 60,017.64

Sales & Other Income 1,55,220.15 1,46,046.49 2,19,179.00 Profit After Tax (5,042.70) (31,160.17) (34,319.93) EPS/ Diluted EPS (in `) (4.46) (26.80) (29.24) Net asset value per share (in `) 68.66 53.27 59.52 5. Reliance Securities Limited Corporate Information

Reliance Securities Limited was incorporated in India, under the Companies Act on June 17, 2005. Reliance Securities Limited is engaged in the business of securities brokering and is a depository participant of CDSL.

Interest of our Promoter

Reliance Capital Limited holds 99.60% interest in Reliance Securities Limited. Financial Information

The brief financial details of Reliance Securities Limited derived from its audited unconsolidated financial statements for financial years 2010, 2011 and 2012 are set forth below:

(` in lakhs, except share data)

Particulars As at and for the

financial year 2010 As at and for the

financial year 2011 As at and for the

financial year 2012 Equity Capital 2,500.00 2,500.00 2,500.00 Reserves (excluding revaluation reserves) 2,064.61 2,774.82 3,375.00

Sales & Other Income 18,750.54 15,378.58 12,026.00 Profit After Tax 218.05 710.21 599.90 EPS/ Diluted EPS (in `)* (6.15) (4.18) (3.41) Net asset value per share (in `) 18.26 21.10 23.50 * After providing for dividend on cumulative redeemable preference shares Group Company with negative net worth The details of the Group Company with negative net worth as at March 31, 2012 are as follows: 1. Reliance Equity Advisors (India) Limited Corporate Information

Reliance Equity Advisors (India) Limited was incorporated in India, under the Companies Act on May 4, 2005. Reliance Equity Advisors (India) Limited is engaged in the business of providing investment advisory services.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Equity Advisors (India) Limited. Financial Information The brief financial details of Reliance Equity Advisors (India) Limited derived from its audited standalone financial statements for financial years 2010, 2011 and 2012 are set forth below:

177

(` in lakhs, except share data)

Particulars As at and for the

financial year 2010 As at and for the

financial year 2011 As at and for the

financial year 2012 Equity Capital 5.00 5.00 5.00 Reserves (excluding revaluation reserves) (1,752.98) (1,526.55) (1,446.96)

Sales & Other Income 974.81 2,315.81 2,073.45 Profit After Tax (817.41) 226.44 79.58 EPS/ Diluted EPS (in `) (1,634.83) 452.88 159.16 Net asset value per share (in `) (3,495.96) (3,043.10) (2,883.93) 2. Reliance Spot Exchange Infrastructure Limited Corporate Information Reliance Spot Exchange Infrastructure Limited was incorporated in India, under the Companies Act on January 12, 2009. Reliance Spot Exchange Infrastructure Limited is engaged in the business of commodity spot exchange. Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Spot Exchange Infrastructure Limited. Financial Information The brief financial details of Reliance Spot Exchange Infrastructure Limited derived from its audited standalone financial statements for financial years 2010, 2011 and 2012 are set forth below:

(` in lakhs, except share data)

Particulars As at and for the

financial year 2010 As at and for the

financial year 2011 As at and for the

financial year 2012 Equity Capital 5.00 1,765.00 1,765.00 Reserves (excluding revaluation reserves) (968.37) (1,524.72) (2,073.35)

Sales & Other Income 2.63 19.91 56.25 Profit After Tax (442.41) (648.48) (550.98) EPS/ Diluted EPS (in `) (884.83) (3.67) (3.12) Net asset value per share (in `) (2,015.37) 0.79 (2.35) 3. Viscount Management Services Limited Corporate Information

Viscount Management Services Limited was incorporated in India, under the Companies Act on May 8, 1995. It is engaged in the business of providing consultancy services various fields including, management, finance and commerce to any person or corporation.

Interest of the Promoter

Reliance Capital Limited and Reliance Land Private Limited hold 18% interest each in Viscount Management Services Limited. Financial Information

The brief financial details of Viscount Management Services Limited derived from its audited standalone financial statements for financial years 2010, 2011 and 2012 are set forth below:

178

(` in lakhs, except share data)

Particulars As at and for the

financial year 2010 As at and for the

financial year 2011 As at and for the

financial year 2012 Equity Capital 6.00 6.00 23.00 Reserves (excluding revaluation reserves) 15,507.67 12,904.1 (2,493.62)

Sales & Other Income 0.00 1.15 0.00 Profit After Tax (7,400.29) (7144.15) (7,996.32) EPS/ Diluted EPS (in `) (12,333.81) (11,906.91) (3,476.66) Net asset value per share (in `) 25,856.12 21,516.83 (1,074.18) 4. Indian Agri Services Private Limited Corporate Information

Indian Agri Services Private Limited was incorporated in India, under the Companies Act on April 29, 2011. Indian Agri Services Private Limited is engaged in the business and services of handling, delivering commodities / things / produce from gate level to consumers.

Interest of our Promoter

Reliance Capital Limited holds 79.17% interest in Indian Agri Services Private Limited. Financial Information

The brief financial details of Indian Agri Services Private Limited derived from its audited standalone financial statements for financial years 2010, 2011 and 2012 are set forth below:

(` in lakhs, except share data)

Particulars As at and for the

financial year 2010 As at and for the

financial year 2011 As at and for the

financial year 2012 Equity Capital NA NA 3.00 Reserves (excluding revaluation reserves)

NA NA (5.67)

Sales & Other Income NA NA 288.02 Profit After Tax NA NA (5.67) EPS/ Diluted EPS (in `) NA NA (18.89) Net asset value per share (in `) NA NA (8.89) Other Group Companies Details of other Group Companies are as follows:

1. Adhar Project Management & Consultancy Private Limited

Corporate Information

Adhar Project Management & Consultancy Private Limited was incorporated in India, under the Companies Act on June 11, 2008. Adhar Project Management & Consultancy Private Limited is engaged in the business of providing management consultancy services.

Interest of our Promoter

Reliance Land Private Limited holds 100.00% interest in Adhar Project Management & Consultancy Private Limited.

179

2. Ammolite Holdings Limited Corporate Information Ammolite Holdings Limited was incorporated in Jersey, UK, under the relevant applicable laws on August 26, 2005. Ammolite Holdings Limited is engaged in the business of managerial, technical, chartering, and agency services.

Interest of our Promoter

Reliance Capital Limited and Reliance Land Private Limited each holds 50.00% interest in Ammolite Holdings Limited.

3. QOPPA Trading Private Limited

Corporate Information

QOPPA Trading Private Limited was incorporated in India, under the Companies Act on February 28, 2011. QOPPA Trading Private Limited is engaged in the business of investment and trading activities.

Interest of our Promoter

Reliance Capital Limited holds 74.00% interest in QOPPA Trading Private Limited. 4. Quant Broking Private Limited

Corporate Information

Quant Broking Private Limited was incorporated in India, under the Companies Act on December 4, 2007. Quant Broking Private Limited is engaged in the business of broking.

Interest of our Promoter Reliance Capital Limited holds 74.00% interest in Quant Broking Private Limited.

5. Quant Capital Advisors Private Limited

Corporate Information

Quant Capital Advisors Private Limited was incorporated in India, under the Companies Act on March 9, 2009. Quant Capital Advisors Private Limited is engaged in the business of providing mutual fund advisory services.

Interest of our Promoter

Reliance Capital Limited holds 74.00% interest in Quant Capital Advisors Private Limited.

6. Quant Capital Finance and Investments Private Limited

Corporate Information

Quant Capital Finance and Investments Private Limited was incorporated in India, under the Companies Act on December 31, 1981. Quant Capital Finance and Investments Private Limited is a non banking financial institution.

Interest of our Promoter

Reliance Capital Limited holds 74.00% interest in Quant Capital Finance and Investments Private Limited.

180

7. Quant Capital Private Limited

Corporate Information

Quant Capital Private Limited was incorporated in India, under the Companies Act on December 4, 2007. Quant Capital Private Limited is engaged in the business of providing investment and financial services.

Interest of our Promoter

Reliance Capital Limited holds 74.00% interest in Quant Capital Private Limited.

8. Quant Commodities Private Limited

Corporate Information

Quant Commodities Private Limited was incorporated in India, under the Companies Act on March 9, 2009. Quant Commodities Private Limited is engaged in the business of commodity exchange. Interest of our Promoter

Reliance Capital Limited holds 74.00% interest in Quant Commodities Private Limited.

9. Quant Commodity Broking Private Limited

Corporate Information

Quant Commodity Broking Private Limited was incorporated in India, under the Companies Act on March 9, 2009. Quant Commodity Broking Private Limited is engaged in the business of commodity broking.

Interest of our Promoter

Reliance Capital Limited holds 74.00% interest in Quant Commodity Broking Private Limited.

10. Quant Investment Services Private Limited

Corporate Information

Quant Investment Services Private Limited was incorporated in India, under the Companies Act on March 18, 2011. Quant Investment Services Private Limited is engaged in the business of providing advisory services.

Interest of our Promoter

Reliance Capital Limited holds 74.00% interest in Quant Investment Services Private Limited.

11. Quant Securities Private Limited Corporate Information

Quant Securities Private Limited was incorporated in India, under the Companies Act on December 4, 2007. Quant Securities Private Limited is engaged in the business of stock broking.

Interest of our Promoter

Reliance Capital Limited holds 74.00% interest in Quant Securities Private Limited.

181

12. QCAP Trade Private Limited (formerly, Valankulam Investments and Trading Private Limited) Corporate Information

QCAP Trade Private Limited was incorporated in India, under the Companies Act on March 1, 2011. QCAP Trade Private Limited is engaged in the business of investment and trading activities.

Interest of our Promoter

Reliance Capital Limited holds 74.00% interest in QCAP Trade Private Limited.

13. Reliance Alternative Investments Services Private Limited

Corporate Information

Reliance Alternative Investments Services Private Limited was incorporated in India, under the Companies Act on September 26, 2008. Reliance Alternative Investments Services Private Limited is engaged in the business of providing services of a trustee.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Alternative Investments Services Private Limited.

14. Reliance Asset Management (Malaysia) Sdn. Bhd.

Corporate Information

Reliance Asset Management (Malaysia) Sdn. Bhd. was incorporated in Malaysia, under the applicable Malaysian law on February 20, 2009. Reliance Asset Management (Malaysia) Sdn. Bhd. is engaged in the business of Islamic fund management.

Interest of our Promoter

Reliance Capital Limited holds 92.94% interest in Reliance Asset Management (Malaysia) Sdn. Bhd.

15. Reliance Asset Management (Mauritius) Limited

Corporate Information

Reliance Asset Management (Mauritius) Limited was incorporated in Mauritius, under the applicable Mauritius law on December 27, 2004. Reliance Asset Management (Mauritius) Limited is engaged in the business of providing investment management and advisory services to collective investment schemes.

Interest of our Promoter

Reliance Capital Limited holds 92.94% interest in Reliance Asset Management (Mauritius) Limited.

16. Reliance Asset Management (Singapore) Pte Limited

Corporate Information

Reliance Asset Management (Singapore) Pte Limited was incorporated in Singapore, under the applicable Singapore law on August 22, 2005. Reliance Asset Management (Singapore) Pte Limited is engaged in the business of providing fund management and advisory services.

182

Interest of our Promoter

Reliance Capital Limited holds 92.94% interest in Reliance Asset Management (Singapore) Pte Limited.

17. Reliance Asset Reconstruction Company Limited

Corporate Information

Reliance Asset Reconstruction Company Limited was incorporated in India, under the Companies Act on April 17, 2006. Reliance Asset Reconstruction Company Limited is engaged in the business of asset reconstruction and securitization.

Interest of our Promoter

Reliance Capital Limited holds 49% interest in Reliance Asset Reconstruction Company Limited.

18. Reliance Capital (Singapore) Pte. Limited Corporate Information

Reliance Capital (Singapore) Pte. Limited was incorporated in Singapore, under the applicable Singapore law on July 8, 2008. Reliance Capital (Singapore) Pte. Limited is engaged in the business of providing financial advisory services.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Capital (Singapore) Pte. Limited. 19. Reliance Capital Asset Management (UK) Plc. Corporate Information

Reliance Capital Asset Management (UK) Plc. was incorporated in UK, under the applicable UK law on May 23, 2007. Reliance Capital Asset Management (UK) Plc. is engaged in the business of providing financial advisory services.

Interest of our Promoter

Reliance Capital Limited holds 92.94% interest in Reliance Capital Asset Management (UK) Plc.

20. Reliance Capital Partners

Corporate Information

Reliance Capital Partners is a partnership firm constituted in India, under the Indian Partnership Act, 1932 on April 19, 2006. Reliance Capital Partners is engaged in the business of trading in various commodities and articles other than securities.

Interest of our Promoter

Reliance Capital Partners is a partnership firm. Reliance Capital Limited and Reliance Land Private Limited are its partners. 21. Reliance Capital Pension Fund Limited Corporate Information

Reliance Capital Pension Fund Limited was incorporated in India, under the Companies Act on March 31,

183

2009. Reliance Capital Pension Fund Limited is engaged in the business of managing pension funds and providing allied advisory services.

Interest of our Promoter

Reliance Capital Limited holds 92.94% interest in Reliance Capital Pension Fund Limited. 22. Reliance Capital Trustee Co. Limited Corporate Information

Reliance Capital Trustee Co. Limited was incorporated in India, under the Companies Act on January 3, 1995. Reliance Capital Trustee Co. Limited is engaged in the business of providing trusteeship services and act as administrator of mutual funds.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Capital Trustee Co. Limited. 23. Reliance Capital Infrastructure Partners

Corporate Information

Reliance Capital Infrastructure Partners is a partnership firm constituted in India, under the Indian Partnership Act, 1932 on March 16, 2007. Reliance Capital Infrastructure Partners is engaged in the business of pulling group resources and arranging financial closure of Noida SEZ.

Interest of our Promoter Reliance Capital Infrastructure Partners is a partnership firm with Reliance Capital Limited, Reliance Infocomm Infrastructure Private Limited and Reliance Infraprojects Limited as its partners. 24. Reliance Commodities Limited Corporate Information

Reliance Commodities Limited was incorporated in India, under the Companies Act on July 8, 2005. Reliance Commodities Limited is engaged in the business of Commodities Broking.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Commodities Limited. 25. Reliance Composite Insurance Broking Limited Corporate Information

Reliance Composite Insurance Broking Limited was incorporated in India, under the Companies Act on October 24, 1994. Reliance Composite Insurance Broking Limited is engaged in the business of insurance broking.

Interest of our Promoter

Reliance Capital Limited holds 51.79% interest in Reliance Composite Insurance Broking Limited. 26. Reliance Consultants (Mauritius) Ltd.

184

Corporate Information

Reliance Consultants (Mauritius) Ltd. was incorporated in Mauritius, under the applicable Mauritius law on March 10, 2008. Reliance Consultants (Mauritius) Ltd. is engaged in the business of providing investment advisory services.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Consultants (Mauritius) Ltd. 27. Reliance Equities International Private Limited Corporate Information

Reliance Equities International Private Limited was incorporated in India, under the Companies Act on February 21, 2000. Reliance Equities International Private Limited is engaged in the business of institutional broking services.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Equities International Private Limited. 28. Reliance Exchangenext Limited Corporate Information

Reliance Exchangenext Limited was incorporated in India, under the Companies Act on July 7, 2000. Reliance Exchangenext Limited is engaged in the business of forming and promoting stock exchanges.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Exchangenext Limited. 29. Reliance Financial Limited Corporate Information

Reliance Financial Limited was incorporated in India, under the Companies Act on August 26, 2005. Reliance Financial Limited is registered with RBI as a Non Banking Financial Company. Reliance Financial Limited is engaged in the business of providing financial services.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Financial Limited. 30. Reliance Gilts Limited Corporate Information

Reliance Gilts Limited was incorporated in India, under the Companies Act on August 17, 2000. Reliance Gilts Limited is engaged in the business of dealing in government securities.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Gilts Limited.

185

31. Reliance Home Finance Limited Corporate Information

Reliance Home Finance Limited was incorporated in India, under the Companies Act on June 5, 2008. Reliance Home Finance Limited is engaged in the business of providing home finance and other allied services.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Home Finance Limited. 32. Reliance Investment Banking Services Limited

Corporate Information

Reliance Investment Banking Services Limited was incorporated in India, under the Companies Act on May 22, 2008. Reliance Investment Banking Services Limited is engaged in the business of providing investment / merchant banking services.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Investment Banking Services Limited.

33. Reliance Money Express Limited Corporate Information Reliance Money Express Limited was incorporated in India, under the Companies Act on November 28, 2002. Reliance Money Express Limited is registered with RBI for providing services as a full –fledged money changer (FFMC) and money transfer services.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Money Express Limited. 34. Reliance Money Precious Metals Private Limited (formerly Reliance Capital Research Private

Limited) Corporate Information

Reliance Money Precious Metals Private Limited was incorporated in India, under the Companies Act on October 5, 2006. Reliance Money Precious Metals Private Limited is engaged in the business of equity research, offering Gold Accumulation Plans to retail investors. Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Money Precious Metals Private Limited. 35. Reliance Share & Stock Brokers Private Limited Corporate Information

Reliance Share & Stock Brokers Private Limited was incorporated in India, under the Companies Act on November 26, 1993. Reliance Share & Stock Brokers Private Limited is engaged in the business of share and stock broking services.

186

Interest of our Promoter

Reliance Capital Limited holds 50.00% interest in Reliance Share & Stock Brokers Private Limited. 36. Reliance Venture Asset Management Private Limited

Corporate Information

Reliance Venture Asset Management Private Limited was incorporated in India, under the Companies Act on October 6, 2006. Reliance Venture Asset Management Private Limited is engaged in the business of providing venture capital services.

Interest of our Promoter

Reliance Capital Limited holds 100.00% interest in Reliance Venture Asset Management Private Limited. 37. Reliance Wealth Management Limited

Corporate Information

Reliance Wealth Management Limited was incorporated in India, under the Companies Act on January 1, 2009. Reliance Wealth Management Limited is engaged in the business of providing portfolio / wealth management services. Interest of our Promoter Reliance Capital Limited holds 100.00% interest in Reliance Wealth Management Limited. Common Pursuits amongst our Group Companies with our Company There are no common pursuits amongst any of our Group Companies and our Company. Related Business Transactions within our Group Companies and Significance on the Financial Performance of our Company For details, please see the chapter entitled “Financial Statements” at page 188. Sale/ Purchase between Group Companies For details, please see the chapter entitled “Financial Statements” at page 188. Business Interest of Group Companies in our Company

For details, please see the chapter entitled “Financial Statements” at page 188.

187

DIVIDEND POLICY The declaration and payment of dividends will be recommended by our Board of Directors and approved by the shareholders of our Company, at their discretion, subject to the provisions of the Articles of Association and the Companies Act. The dividend, if any, will depend on a number of factors, including but not limited to the future expansion plans and capital requirements, profit earned during the financial year, liquidity and applicable taxes including dividend distribution tax payable by our Company. The following table sets forth certain details regarding the dividend paid by our Company on the Equity Shares for Fiscal Years 2010, 2011, and for the 12 months ended 2012:

(In ` lakhs, except per share data) Particulars Fiscal 2010 Fiscal 2011 12 months

ended 2012 Face value of Equity Shares (` per share) 5/- 5/- 5/- Interim dividend on Equity Shares (` per share) Nil Nil Nil Final dividend of Equity Shares (` per share) Nil Nil Nil Total dividend on Equity Shares Nil Nil Nil Dividend tax (gross) Nil Nil Nil Amounts paid as dividends in the past are not reflective of any future dividends, which are subject to the recommendation of our Board of Directors based on various factors and the approval of our Company’s shareholders. Investors are cautioned not to rely on past dividends as an indication of our future performance or for an investment in the Equity Shares.

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SECTION V: FINANCIAL INFORMATION

FINANCIAL STATEMENTS

Sr. No. Particulars Pg No.

1.

Audited restated consolidated financial statements as of and for the twelve months period ended March 31, as of and for the year ended March 31, 2011, year ended March 31, 2010, year ended March 31, 2009, nine months ended March 31, 2008 and fifteen months ended June 30, 2007

189 – 345

2.

Audited restated standalone financial statements as of and for the twelve months period ended March 31, as of and for the year ended March 31, 2011, year ended March 31, 2010, year ended March 31, 2009, nine months ended March 31, 2008 and fifteen months ended June 30, 2007

346 – 474

189

The Board of Directors Reliance MediaWorks Limited Film City Complex Goregaon (East) MUMBAI 400 065 25 July 2012

Dear Sirs

1 We have examined the attached restated summary consolidated financial information of Reliance MediaWorks Limited (‘RMWL’ or ‘the Company’ or ‘the Parent Company’) and its subsidiaries, joint ventures and associate / s (together referred to as ‘the Group’), as approved by the Board of Directors of the Company, prepared in terms of the requirements of Paragraph B, Part II of Schedule II to the Companies Act, 1956 ('the Act'), the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2009, as amended to date, to the extent applicable (‘SEBI Regulations’), the Guidance note on ‘Reports in Company Prospectus (Revised)’ issued by the Institute of Chartered Accountants of India (‘ICAI’), to the extent applicable (‘Guidance Note’), and in terms of our engagement agreed upon with you in accordance with our engagement letter dated 11 July 2012 in connection with the proposed Issue of Equity Shares of the Company on a rights basis.

2 We have examined the attached Summary Statement of Assets and Liabilities, as restated, of the Group as at 31 March 2012, 31 March 2011, 31 March 2010, 31 March 2009, 31 March 2008 and 30 June 2007, the attached Summary Statement of Profit and Loss, as restated, of the Group for the twelve months period ended 31 March 2012, year ended 31 March 2011, year ended 31 March 2010, year ended 31 March 2009, nine months ended 31 March 2008 and fifteen months ended 30 June 2007 and the attached Summary Statement of Cash Flow, as restated, of the Group for the twelve months period ended 31 March 2012, year ended 31 March 2011, year ended 31 March 2010, year ended 31 March 2009, nine months ended 31 March 2008 and fifteen months ended 30 June 2007, as set out in Annexure I, Annexure II and Annexure III respectively, together referred to hereinafter as the ‘Restated Summary Statements of the Group’. These Restated Summary Statements of the Group have been prepared by the management of the Company from the audited condensed consolidated financial statements for the twelve months period ended 31 March 2012 and from the audited consolidated financial statements for the year ended 31 March 2011, year ended 31 March 2010, year ended 31 March 2009, nine months ended 31 March 2008 and fifteen months ended 30 June 2007, being the last six financial years / periods for which the consolidated accounts of the Group have been made up, and have been approved by the Board of Directors of the Company for the respective years and approved by the members of the Company, except the financial statements for the twelve months ended 31 March 2012 which have been approved only by the Board of Directors of the Company. The consolidated financial statements of the Company as at and for the year ended 31 March 2009, nine months ended 31 March 2008, fifteen month ended 30 June 2007 have been audited by one of the joint auditors, B S R & Co., Chartered Accountants. The condensed consolidated financial statements for the twelve months ended 31 March 2012 and the financial statements as at and for the year ended 31 March 2011 and year ended 31 March 2010 have been audited by us.

190

a. In the consolidated financial statements for the fifteen months ended 30 June 2007, the joint auditors, B S R & Co., Chartered Accountants, have relied on reports of other auditors for subsidiaries and certain joint ventures not audited by them, whose financial statements reflect the Group’s share of total assets of ` 6,960.00 lakhs as at 30 June 2007 and the Group’s share of total revenues of ` 5,595.00 lakhs and net cash inflows of ` 2,407.50 lakhs for the fifteen months ended 30 June 2007.

b. In the consolidated financial statements for the nine months ended 31 March 2008, the joint auditors, B S R & Co., Chartered Accountants, have relied on reports of other auditors for subsidiaries, associate and certain joint ventures not audited by them, whose financial statements reflect the Group’s share of total assets of ` 4,200.20 lakhs as at 31 March 2008 and the Group’s share of total revenues of ` 3,490.00 lakhs and net cash inflows of ` 3,256.30 lakhs for the nine months ended 31 March 2008.

c. In the consolidated financial statements for the year ended 31 March 2009, the joint auditors, B S R & Co., Chartered Accountants, have relied on reports of other auditors for subsidiaries, associate and certain joint ventures not audited by them, whose financial statements reflect the Group’s share of total assets of ` 40,048.70 lakhs as at 31 March 2009 and the Group’s share of total revenues of ` 20,003.80 lakhs and net cash inflows of ` 1,323.60 lakhs for the year ended 31 March 2009.

d. In the consolidated financial statements for the year ended 31 March 2010:

i) the financial statements of Swanston Multiplex Cinemas Private Limited, a joint venture has been audited by one of the joint auditors, B S R & Co., Chartered Accountants, whose financial statements reflect Group’s share of total assets of ` 937.60 lakhs as at 31 March 2010, Group’s share of total revenues of ` 542.10 lakhs and Group’s share of net cash inflows aggregating ` 3.20 lakhs for the year months ended on that date;

ii) the financial statements of Adlabs Distributors and Exhibitors Limited, a subsidiary has been audited by one of the joint auditors, Chaturvedi & Shah Chartered Accountants, whose financial statements reflect Group’s share of total assets of ` 691.40 lakhs as at 31 March 2010, Group’s share of total revenues of ` 173.50 lakhs and Group’s share of net cash inflows aggregating ` 43.80 lakhs for the year ended on that date;

iii) we have relied on reports of other auditors for certain subsidiaries, associate and certain joint ventures not audited by us, whose financial statements reflect the Group’s share of total assets of ` 63,844.80 lakhs as at 31 March 2010 and the Group’s share of total revenues of ` 25,476.10 lakhs and Group’s share of net cash outflows aggregating ` 35.60 lakhs for the year ended on that date.

e. In the consolidated financial statements for the year ended 31 March 2011:

i) the financial statements of Swanston Multiplex Cinemas Private Limited a joint venture has been audited by one of the joint auditors, B S R & Co., Chartered Accountants, whose financial statements reflect Group’s share of total assets of ` 838.50 lakhs as at 31 March 2011, Group’s share of total revenues of ` 589.50 lakhs and net cash outflows aggregating ` 46.70 lakhs for the year ended on that date;

ii) we have relied on reports of other auditors for certain subsidiaries and certain joint ventures not audited by us, whose financial statements reflect the Group’s share of total assets of ` 70,293.40 lakhs as at 31 March 2011 and the Group’s share of total revenues of ` 32,236.50 lakhs and Group’s share of net cash outflows aggregating ` 796.19 lakhs for the year ended on that date.

191

f. In the condensed consolidated financial statements for the twelve months ended 31 March 2012:

i) the financial statements of Swanston Multiplex Cinemas Private Limited, a joint venture has been audited by one of the joint auditors, B S R & Co., Chartered Accountants, whose financial statements reflect Group’s share of total assets of ` 214.60 lakhs as at 31 March 2012, Group’s share of total revenues of ` 575.80 lakhs and net cash outflows aggregating ` 17.60 lakhs for the twelve months ended on that date;

ii) we have relied on reports of other auditors for certain subsidiaries and certain joint ventures not audited by us, whose financial statements reflect the Group’s share of total assets of ` 58,889.69 lakhs as at 31 March 2012 and the Group’s share of total revenues of ` 29,951.91 lakhs and Group’s share of net cash outflows aggregating ` 345.90 lakhs for the twelve months ended on that date.

3 Without qualifying our report, we draw attention to the following:

a) As set out in paragraph (a) (i) of Note D of Annexure IV to this report, the Group’s net worth is fully eroded and has a negative net worth of ` 23,958.07 Lakh (as restated), the Group has incurred a loss of ` 57,216.63 lakh (as restated) for the period 1 April 2011 to 31 March 2012, indicating the existence of uncertainty that may cast doubt about the Group’s ability to continue as a going concern. Considering the matters set out in the said note, this Restated Summary Statement, of the Group is prepared on a going concern basis.

b) As set out in paragraph (e) (i) of Note D of Annexure IV to this report, during the fifteen months ended 30 June 2007, the Ho’ble High Court of Judicature at Bombay vide its order dated 15 September 2006 sanctioned the Composite Scheme of Amalgamation and Arrangement (‘the Scheme’) between the Company, Entertainment One India Limited (‘E-ONE’), Mukta Adlabs Digital Exhibition Private Limited (‘MADEL’), (name subsequently changed to Adlabs Multiplex and Theatres Limited), Reliance Unicom Limited (‘RUL’) (name subsequently changed to Reliance Broadcast Network Limited) and their respective shareholders and creditors. The Composite Scheme inter-alia provided for the amalgamation of EONE and merger of the digital business of the MADEL with the Company with effect from 1 April 2005 and the demerger of the radio business to RUL effective 31 March 2006.

As represented by the Company’s management, an application to the Ministry of Information and Broadcasting for vesting of radio licenses held by it in the name of RUL was made. Pending the said approval, the Composite Scheme had not been filed with the Registrar of Companies (‘ROC’) as required under Section 391(3) of the Companies Act, 1956. However, pursuant to representations by the management that it is reasonably certain that the Composite Scheme will be filed with the ROC in due course, for the purpose of the consolidated financial statements for the fifteen months ended 30 June 2007, pending completion of licensing and other procedural formalities, the Composite Scheme had been given effect to by the Company’s management in view of the Court approval and to give effect to the substance of the Composite Scheme as approved by the Ho’ble High Court of Judicature at Bombay. Pending completion of licensing and other procedural formalities, the Composite Scheme was eventually not filed with the Registrar of Companies (‘ROC’) as required under Section 391(3) of the Act.

192

Additionally, as set out in paragraph (d)(i) of Note D of Annexure IV, during the period ended 31 March 2008, the Hon’ble High Court of Judicature at Bombay vide its order dated 7 March 2008 sanctioned the Modified Composite Scheme of Amalgamation and Arrangement (‘Modified Scheme’) for modification of the Composite Scheme. The Modified Scheme was filed with the ROC on 31 March 2008. The Modified Scheme inter-alia provides that the net results of the transactions related to the radio business of the Company for the period from 31 March 2006 to the Effective Date (i.e. the date of filing the Modified Scheme with the ROC, 31 March 2008) be adjusted in the General reserve account of the Company. The Composite Scheme was given effect to in accordance with the accounting treatment prescribed by the said Scheme in the consolidated financial statements for the fifteen months ended 30 June 2007 and, only the modifications to the original scheme were have been given effect to in the consolidated financial statements for the nine months ended 31 March 2008.

c) As set out in paragraph (c)(ii) of Note D and point 2 of paragraph IV of Note E of Annexure IV, during the year ended 31 March 2009, the Hon’ble High Court of Judicature at Mumbai vide its order dated 8 May 2009 sanctioned the Scheme of Amalgamation of the Company with its wholly owned subsidiaries Adlabs Multiplex and Theatres Limited, Adlabs Multiplex Limited, Rave Entertainment Private Limited and Mahimna Entertainment Private Limited (‘Amalgamation Scheme’), under sections 391 to 394 of the Act. Pursuant to the said Amalgamation Scheme, the Company has recorded an increase in value of its assets aggregating ` 17,890.10 lakhs by crediting the Capital reserve. Further, the Company has recorded an adjustment for diminution in value of its assets (production and distribution rights, fixed assets, investments, debtors and loans and advances) aggregating ` 15,669.60 lakhs by debiting the same to Capital reserve instead of the profit and loss account, had the Company debited the profit and loss account, the loss before tax for the year would be higher by the said amount.

4 Effective 1 April 2011, revised Schedule VI notified vide Notification No. S.O. 447(E), dated 28-2-2011 (as amended by Notification No. 2/6/2008-CL-V, dated 30-3-2011) and General Circular No. 62/2011 F No. 17/244/2011-CL-V, dated 05.09.2011 under the Act has become applicable to the Group for preparation and presentation of these Summary financial statements, as restated of the Group. Accordingly, the Group has prepared these Restated Summary Statements as per revised Schedule VI. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of annual financial statements, however it introduces additional new disclosures, including compulsory classification of all assets and liabilities into current and non-current.

Further, we draw attention to the fact that for the purposes of these Restated Summary Statements, due to practical difficulties, restatement/ reclassification of the summary financial information as per revised Schedule VI, pertaining to certain subsidiaries, associate/s and certain joint ventures, the said restatement/ reclassification for the year / period ended 31 March 2010, 31 March 2009, nine months ended 31 March 2008 and fifteen months ended 30 June 2007 has not been audited by the respective auditor. Such financial information, as approved by the Board of Directors of the Company and certified by a Proprietor / firm of chartered accountant have been furnished to us by the management of the Company and our report in so far as it relates to the amounts included in respect of such subsidiaries, associate/s and joint venture is based solely on such certified summary financial information.

193

5 In accordance with the requirements of Paragraph B, Part II of Schedule II of the Act, the SEBI Regulations, the Guidance Note and in accordance with the terms of our engagement agreed with you, and read with paragraphs 2 and 4 above and with regards to adjustments for matters of emphasis in the Auditors’ report as stated in paragraph 3 above, we confirm/ further report that the Restated Consolidated Summary Statements examined by us and as set out in Annexure I, Annexure II and Annexure III to this report are prepared after making adjustments and regrouping as in our opinion were appropriate and as are more fully described in the significant accounting policies and notes to the Restated Summary Statements of the Group enclosed as Annexure IV to this report.

6 Based on the above, read with the matters stated in paragraph 2 and 4 above and with regards to adjustments for matters of emphasis in the Auditors’ report as stated in paragraph 3 above, we are of the opinion that the Restated Summary Statements of the Group have been made after incorporating:

i. Adjustments for the changes in accounting policies adopted by the Company retrospectively in respective financial years / periods to reflect the same accounting treatment as per changed accounting policy for all the reporting periods;

ii. Adjustments for material amounts in the respective financial years/ periods to which they relate; and

iii. There are no extraordinary items that need to be disclosed separately in the Restated Summary Statements of the Group.

iv. Adjustments for qualifications, as applicable in the Auditors’ reports in the respective years/ periods to which they relate.

7 We have also examined the following other restated financial information set out in the Annexures prepared by the management and approved by the Board of Directors, relating to the Restated Summary Statements of the Group and annexed to this report.

a) Statement of share capital of the Group, enclosed as Annexure V

b) Summary statement of reserves and surplus of the Group, enclosed as Annexure VI

c) Statement of non-current investment, deferred tax assets, long-term loans and advances and other non-current assets, of the Group, enclosed as Annexure VII

d) Statement of current assets of the Group, enclosed as Annexure VIII

e) Statement of non-current liabilities of the Group, enclosed as Annexure IX

f) Statement of current liabilities of the Group, enclosed as Annexure X

g) Statement of revenue of the Group, enclosed as Annexure XI

h) Statement of other income of the Group, enclosed as Annexure XII

i) Statement of contingent liabilities and commitments of the Group, enclosed as Annexure XIII

j) Statement of accounting ratios of the Group, enclosed as Annexure XIV

k) Statement of principal terms and conditions of long-term borrowings and short-term borrowings of the Group, enclosed as Annexure XV

l) Statement of capitalization of the Group, as at 31 March 2012, enclosed as Annexure XVI

m) Statement of dividend paid/ proposed of the Group, enclosed as Annexure XVII

n) Statement of related party disclosures of the Group, enclosed as Annexure XVIII

o) Statement of Segment Information of the Group, enclosed in Annexure XIX.

194

8 In our opinion, the Restated Summary Statements, as restated of the Group contained in Annexure I, Annexure II and Annexure III to this report, read with the significant accounting policies and notes disclosed in Annexure IV and other financial information contained in Annexure V to Annexure XIX of this report and read with paragraphs 2, 3 and 4 above and note 3 disclosed in Annexure VII and Annexure VIII respectively, have been prepared in accordance with Paragraph B, Part II of Schedule II of the Act and the SEBI Regulations.

9 The report should not in any way be construed as a reissuance or redating of any of the previous audit reports issued by us or by the other firm of Chartered Accountants, nor should this report be construed as a new opinion on any consolidated financial statements referred to herein.

10 We have no responsibility to update our report for events and circumstances occurring after the date of the report.

11 This report is intended solely for use of the management and for inclusion in the Offer Document in connection with the proposed issue of equity shares of the Company on a rights basis, and is not to be used, referred to or distributed for any other purpose without our prior written consent.

For B S R & Co. Chartered Accountants Firm’s Registration No: 101248W

For Chaturvedi & Shah Chartered Accountants

Firm’s Registration No: 101720W

Bhavesh Dhupelia Partner Membership No: 042070 Mumbai 25 July 2012

Parag D. Mehta Partner

Membership No: 113904 Mumbai

25 July 2012

195

Annexure I

Reliance MediaWorks Limited

Summary statement of assets and liabilities of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Assets

A Non-current assets

I Fixed assets (i) Tangible assets 103,273.41 111,782.74 104,933.32 80,215.84 40,666.60 15,762.08 (ii) Intangible

assets 8,342.76 8,804.20 6,034.60 3,249.60 18,251.60 4,181.66 (iii) Capital work-

in-progress 13,817.90 15,029.90 24,538.92 21,203.60 21,331.01 14,982.58 (iv) Intangible

assets under development - - 132.51 - - -

II Goodwill on

consolidation 8,204.52 8,819.42 8,728.62 4,202.56 2,746.76 2,245.28 III Non-current

investments 575.92 1,092.99 1,272.41 1,161.72 6,991.37 7,268.16 IV Deferred tax

assets (net) 0.80 2.60 2.20 18.70 64.40 - V Long-term loans

and advances 25,825.50 29,371.37 27,167.99 24,818.29 29,293.35 8,988.13 VI Other non-current

assets 52.10 389.30 277.42 59.41 43.75 5,117.75 160,092.91 175,292.52 173,087.99 134,929.72 119,388.84 58,545.64 B Current assets I Current

investments - 10.44 7,902.30 - 13,556.71 98.38 II Inventories 1,111.50 1,325.30 907.20 690.50 761.30 209.93 III Trade receivables 21,405.10 21,600.60 23,230.60 21,031.70 12,141.50 5,895.29 IV Cash and bank

balances 8,273.80 11,772.99 8,270.97 7,881.99 12,376.49 11,194.26 V Short-term loans

and advances 13,746.00 13,202.01 36,566.65 34,879.67 25,024.61 40,236.43 VI Other current

assets 5,791.60 5,570.80 2,789.90 4,401.30 4,027.96 116.20 50,328.00 53,482.14 79,667.62 68,885.16 67,888.57 57,750.49 Liabilities C Non-current

liabilities

I Long-term borrowings 61,850.60 44,430.11 40,405.00 57,360.46 53,099.90 46,158.40

196

Annexure I

Reliance MediaWorks Limited

Summary statement of assets and liabilities of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 II Deferred tax

liabilities (net) 6.09 516.39 63.39 66.59 192.03 1,408.19 III Other long-term

liabilities 5,263.90 2,909.05 1,468.90 871.85 342.98 244.96 IV Long-term

provisions 620.10 774.71 383.20 3,434.40 3,038.99 10,216.63 67,740.69 48,630.26 42,320.49 61,733.30 56,673.90 58,028.18 D Minority interest 1,634.08 1,347.88 1,736.58 3,006.58 1,621.78 1,460.06 E Current

liabilities I Short-term

borrowings 57,102.80 103,178.16 117,402.75 72,109.67 41,319.22 12,503.15 II Trade payables 19,622.45 12,935.97 11,088.28 8,287.62 9,004.13 3,356.39 III Other current

liabilities 88,024.46 59,759.57 44,224.02 9,204.87 9,049.62 4,681.57 IV Short-term

provisions 254.50 215.99 165.91 230.40 1,826.01 1,187.26 165,004.21 176,089.69 172,880.96 89,832.56 61,198.98 21,728.37 F Net Worth (A+B-

C-D-E) (23,958.07) 2,706.83 35,817.58 49,242.44 67,782.75 35,079.52 G Represented by i) Share capital 2,453.80 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04 ii) Reserves and

surplus (net) (26,411.87) 400.53 33,511.28 46,936.14 65,476.45 33,089.48 H Net worth ( i+ ii ) (23,958.07) 2,706.83 35,817.58 49,242.44 67,782.75 35,079.52 The above statement should be read together with significant accounting policies and notes to summary statement of assets and liabilities, as restated, of the Group (Annexure IV)

197

Annexure II

Reliance MediaWorks Limited Summary statement of profit and loss of the Group, as restated (` in lakhs)

Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Revenue from operations 81,744.90 79,207.40 71,507.20 65,935.34 30,768.94 35,541.47 Other income 1,727.80 5,818.80 3,256.70 7,184.90 5,527.80 7,583.95 Total revenue 83,472.70 85,026.20 74,763.90 73,120.24 36,296.74 43,125.42

Direct operational expenses 32,615.60 31,059.80 28,102.00 23,868.30 9,792.00 12,276.42 Employee benefits expense 21,741.10 20,979.80 13,179.30 10,147.60 2,605.10 2,308.02 Finance costs (including loss on derivative contracts) (net) 28,505.17 17,514.20 11,717.20 12,447.20 2,905.24 618.06 Depreciation, amortisation and impairment expense 14,159.10 13,226.50 9,729.44 13,542.41 10,153.62 9,450.22 Other expenses 43,279.95 34,672.96 25,317.05 20,056.90 7,914.65 7,192.71 Total expenses 140,300.92 117,453.26 88,044.99 80,062.41 33,370.61 31,845.43 (Loss) / profit before tax and minority interest (56,828.22) (32,427.06) (13,281.09) (6,942.17) 2,926.13 11,279.99 less - Provision for taxes - Current tax 460.00 113.90 39.61 414.91 228.29 217.56 - Deferred tax (credit) / charge (472.69) 452.69 13.25 (69.44) 551.72 526.14 - Fringe benefit tax - - - 171.70 78.00 51.12 Net (loss) / profit after tax before minority interest (56,815.53) (32,993.65) (13,333.95) (7,459.34) 2,068.12 10,485.17 - Less: (Loss) / profit transferred to Minority interest 401.10 (196.70) (530.87) (322.12) 53.80 66.76 Net (loss) / profit after tax before adjustment pursuant to Schemes (57,216.63) (32,796.95) (12,803.08) (7,137.22) 2,014.32 10,418.41 Add: Adjustment pursuant to Modified Composite Scheme of Amalgamation and Arrangement - - - - 84.20 -

198

Annexure II

Reliance MediaWorks Limited Summary statement of profit and loss of the Group, as restated (` in lakhs)

Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Less: Adjustment pursuant to Scheme of Amalgamation of Katch 22 - - - - (100.00) - Less: Adjustment pursuant to Scheme of Arrangement for demerger of Radio business/ Scheme of Amalgamation - - - (649.30) - - Net (loss) / profit after tax (Balance carried to Annexure VI) (57,216.63) (32,796.95) (12,803.08) (7,786.52) 1,998.52 10,418.41 The above statement should be read together with significant accounting policies and notes to summary statement of profit and loss, as restated, of the Group (Annexure IV) Period 2012 - Twelve months ended 31 March 2012 Period 2011 - Year ended 31 March 2011 Period 2010 - Year ended 31 March 2010 Period 2009 - Year ended 31 March 2009 Period 2008 - Nine months ended 31 March 2008 Period 2007 - Fifteen months ended 30 June 2007

199

Annexure III

Reliance MediaWorks Limited Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

A

Cash flow from operating activities

Net (loss) / profit before tax, as restated (56,828.22) (32,427.06) (13,281.09) (6,942.17) 2,926.13 11,279.99

Adjustment for

Depreciation, amortisation and impairment expense 14,159.10 13,226.50 9,729.44 13,542.41 10,153.62 9,450.22

Bad debts / Advances written off 189.40 201.20 152.10 348.40 391.00 21.43

Sundry balances written-off 180.13 - - - - -

Provisions written back - (241.70) - - -

Provision for doubtful debts and advances 1,500.00 1,666.30 121.90 - 3.20 -

Capital work-in-progress written off 3,613.90 - - - - -

Dividend income (0.40) - - (132.60) (127.40) (203.58)

Interest income (942.20) (868.40) (538.60) (967.10) (967.70) (2,948.49)

Profit on derivative contract - - - - (977.40) (2,671.24)

Loss / (profit) on sale / discarding of fixed assets (net) 297.27 (2,694.80) 70.60 6.80 57.20 7.76

Gain on sale of current investments (32.10) (423.60) (274.40) (1,969.20) (2,692.70) (1,531.64)

Unrealised foreign exchange (gain) / loss (1,648.54) (129.80) (474.39) (1,136.60) 16.70 36.97

Finance costs (including loss on derivative contracts) (net) 28,505.17 17,514.20 11,717.20 12,447.20 2,905.24 618.06

200

Annexure III

Reliance MediaWorks Limited Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Operating profit before working capital changes and before net results of Radio Business (11,006.49) (3,935.46) 6,981.06 15,197.14 11,687.89 14,059.48

Adjustment for cash loss pertaining to transaction relating to Radio business till 31 March 2008, pursuant to the Modified Composite Scheme of Amalgamation and Arrangement - - - - (8,377.00) -

(11,006.49) (3,935.46) 6,981.06 15,197.14 3,310.89 14,059.48

Operating profit before working capital changes

Adjustment for :

(Increase) / decrease in trade receivables (962.80) (393.30) (2,513.90) (17,371.80) (7,658.94) (1,651.36)

Decrease / (increase) in loans and advances and other assets 1,951.90 (5,064.24) (1,670.40) 7,719.20 (1,370.40) (31,681.39)

Decrease / (increase) in 222.20 (417.00) (231.50) 80.10 (551.40) 378.62

Inventories

Increase / (decrease) in trade and other payable 7,828.27 3,345.12 4,196.26 (2,084.43) 10,404.08 4,044.45

Adjustment for Katch 22 merger due to Scheme of Amalgamation (Refer note 4 of V of E of Annexure IV) - - - - 23.30 -

201

Annexure III

Reliance MediaWorks Limited Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Cash (used in) / generated from operating activities (1,966.92) (6,464.88) 6,761.52 3,540.21 4,157.53 (14,850.20)

Taxes paid (net of refunds) 721.40 1,188.26 (1,467.09) (1,974.50) (1,628.70) (1,851.64)

Net cash (used in) / generated from operating activities (A) (1,245.52) (5,276.62) 5,294.43 1,565.71 2,528.83 (16,701.84)

B

Cash flow from investing activities

Purchase of fixed assets (5,476.11) (22,335.80) (40,917.60) (35,911.00) (49,772.50) (30,933.38)

Proceeds from sale of fixed assets / advance against sale of assets 19,453.13 13,999.70 23.10 1,097.50 14.10 48.47

Purchase of investment- long term- in shares of subsidiaries companies/ - (90.80) (3,001.00) (7,861.20) (2,653.60) (1,319.95)

joint venture/ associates

Proceeds from / (Investment in) mutual funds (net) 544.90 8,407.58 (7,707.63) 13,825.89 (13,591.43) 42,129.81

Purchase of investment- long term- other - (9.90) (4.30) (0.30) (5,775.66)

Proceeds on sale of non-current investments / rights therein 1,233.62 23.10 4,066.80 3,127.30 - 1,531.64

(Investment in) / withdrawals’ from Partnership firm 12.90 (15.80) 371.80 278.30 - -

202

Annexure III

Reliance MediaWorks Limited Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Dividend income 0.40 - - 132.60 127.40 203.58

Interest income 1,080.20 784.50 647.30 1,626.10 288.20 666.15

Cash (used)/ generated in investing activities 16,849.04 772.48 (46,527.13) (23,688.81) (65,588.13) 6,550.66

Taxed paid (net of refunds) (54.70) (25.80) (35.60) (103.10) (194.40) (119.81)

Net Cash (used)/ generated in investing activities (B) 16,794.34 746.68 (46,562.73) (23,791.91) (65,782.53) 6,430.85

C

Cash flow from financing activities

Proceeds from fresh issue of share capital (including share premium) / 29,500.00 - - - - 2,500.00 preference shares

Payment to Minority (130.80) (228.60) (598.60) (212.90) - -

Dividend tax paid on distribution by Subsidiaries and joint ventures (7.90) (9.10) - (12.80) - -

Introduction of capital by minority partners in a Subsidiary - - 62.99 - - -

Profit/ (loss) on option contract - - - - 977.40 2,671.24 Proceeds from long-term debentures 35,000.00 - - - - -

Proceeds from long-term borrowings 10,000.00 39,775.90 5,489.00 7,826.10 40,000.00 -

Repayment of Foreign currency convertible bonds - (15,814.50) - - - -

203

Annexure III

Reliance MediaWorks Limited Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

(Repayment) / proceeds from short term borrowings (net) (45,443.32) (1,003.80) 52,962.60 31,271.20 28,812.30 10,108.31

Repayment of long term borrowings (24,121.80) (17,083.30) - - - -

Interest recoverable from Reliance Broadcast Network Limited (576.80) (1,448.60) (2,507.90) (2,584.90) - -

Recovered from Reliance Broadcast Network Limited pursuant to demerger of Radio business

- 20,000.00 - - - -

Dividend (including dividend tax) paid - - - (1,349.20) (1,164.10) (1,116.11)

Finance costs (including loss on derivative contracts) (net) (22,094.09) (18,773.50) (13,414.80) (11,287.10) (4,949.20) (329.92)

Net cash (used in) / generated from financing activities ( C ) (17,874.71) 5,414.50 41,993.29 23,650.40 63,676.40 13,833.52

Net (decrease) / increase in cash and cash equivalent (A+B+C) (2,325.89) 884.56 724.99 1,424.20 422.70 3,562.53

Cash and cash equivalents as at beginning of the period 5,461.75 4,557.09 3,659.50 5,830.40 5,101.00 1,518.73

Cash and cash equivalents taken over on acquisition of subsidiaries - - 292.10 611.90 - -

Exchange gain / loss on translation 89.60 20.10 (119.50) - - -

204

Annexure III

Reliance MediaWorks Limited Summary statement cash flow of the Group, as restated (` in lakhs)

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Cash and cash equivalents disposed on sale of subs/ JV's 362.66 - - - - -

Adjustment from Composite Scheme of Amalgamation and Arrangement / Modified Composite Scheme of Amalgamation and Arrangement / Scheme of Arrangement / Scheme of Amalgamation - - - (4,207.00) 306.70 19.74

Cash and cash equivalents as at end of the period (refer note (I) and (II) D of Annexure VIII) 2,862.80 5,461.75 4,557.09 3,659.50 5,830.40 5,101.00

(2,325.89) 884.56 724.99 1,424.20 422.70 3,562.53 The above statement should be read together with significant accounting policies and notes to summary statement of cash flows, as restated, of the Group (Annexure IV)

Note: The above cash flow statement has been prepared under the “Indirect” Method as set out in Accounting Standard 3 – ‘Cash Flow Statements’.

Period 2012 - Twelve months ended 31 March 2012 Period 2011 - Year ended 31 March 2011 Period 2010 - Year ended 31 March 2010 Period 2009 - Year ended 31 March 2009 Period 2008 - Nine months ended 31 March 2008 Period 2007 - Fifteen months ended 30 June 2007

205

Annexure IV

Reliance MediaWorks Limited Significant accounting policies and notes to the restated summary statements of the Group

The figures for Period 2012 represent twelve months ended 31 March 2012, Period 2011 represent the year ended 31 March 2011, Period 2010 represents the year ended 31 March 2010, Period 2009 represents the year ended 31 March 2009, Period 2008 represents the nine months ended 31 March 2008 and Period 2007 represents the fifteen months ended 30 June 2007. Summary statements are not strictly comparable on account of accounting pursuant to Court approved Schemes in Period 2007, Period 2008 and Period 2009. Also, the summary statements are not comparable on account of varying accounting periods forming part of them.

The restated summary statements of the Group have been prepared to comply in all material respects with the requirements of Schedule II to the Companies Act, 1956 (“the Act”) read with the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2009 (“the SEBI Regulations”) notified by SEBI on August 26, 2009, as amended, to the extent applicable.

A. Summary of significant accounting policies

1. Basis of preparation

These summary statements of the Group relate to Reliance MediaWorks Limited (‘the Company or Parent Company’), its subsidiary companies, associates and joint ventures. The Company along with its subsidiaries, associates and joint ventures constitute ‘the Group’.

The summary statements of the subsidiaries, joint venture and associates companies used in the consolidation are for the same reporting period as the Company. These financial statements are audited by the auditors of the respective entities.

These summary statements of the Group are prepared and presented under the historical cost convention on the accrual basis of accounting except for revaluation of certain fixed assets and in accordance with the Accounting Standards (‘AS’) notified in the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956 (‘the Act’), to the extent applicable. The summary statements are presented in Indian Rupees in lakhs except per share data and where mentioned otherwise.

Effective 1 April 2011, as per the Government Notification no. S.O. 447 (E) dated 28 February 2011 (as amended by notification no. F. No/2/6/2008-CL-V dated 30 March 2011), read with General Circular no. 62/2011 dated 5 September 2011, issued by the Ministry of Company Affairs, the revised Schedule VI notified under the Act has become applicable to the Company for the purpose of preparation and presentation of its summary statements. The adoption of revised Schedule VI does not impact the recognition and measurement principles followed for preparation of summary statements. All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out in the revised Schedule VI.

Due to practical difficulties, restatement / reclassification of the summary financial information as per revised Schedule VI, pertaining to certain subsidiaries, associate and joint ventures, the said restatement / reclassification for the Period 2012, 2011, 2010, 2009, 2008 and 2007 has not been audited by the respective auditor. Such financial information, as approved by the Board of Directors of the Company and certified by a firm of Chartered Accountant / Chartered Accountant have been furnished to us by the management of the Company and our report in so far as it relates to the amounts included in respect of such subsidiaries, associate and joint venture is based solely on such certified summary financial information.

Interim condensed consolidated financial statements for the Period 2012 of Reliance MediaWorks Limited ('the Company') have been prepared in accordance with Accounting Standard 25 "Interim Financial Reporting" (‘AS 25’) prescribed in the Companies (Accounting Standard) Rules, 2006 issued by the Central Government in consultation with National Advisory Committee on Accounting Standards and in accordance with the relevant provisions of the Companies Act, 1956, to the extent applicable. These interim condensed consolidated financial statements should be read in conjunction with annual financial statements of the Company for the year ended and as at 31 March 2011. The

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accounting policies followed in preparation of these condensed consolidated financial statements are consistent with those followed in the preparation of the annual financial statements. The restated summary statements of Group have been prepared to comply in all material respects with the requirements of Schedule II to the Companies Act, 1956 (“the Act”) and the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2009 (“the SEBI Regulations”) notified by SEBI on August 26, 2009, as amended, to the extent applicable.

2. Principles of Consolidation The Summary statements of the Group are prepared in accordance with AS 21 – ‘Consolidated Financial Statements’, AS 23 - ‘Accounting for Investments in Associates in Consolidated Financial Statements’ and AS 27 – ‘Financial Reporting of Interest in Joint ventures’. Summary statements of the Group are prepared using uniform accounting policies for transactions and other events in similar circumstances except where it is not practicable to do so. The Summary statements of the Group are presented, to the extent possible, in the same format as that adopted by the Parent Company for its independent Summary Statements. The Summary statements of the Group have been consolidated on the following basis: Subsidiaries The excess of cost to the Group of its investment in subsidiaries over its portion of equity in the subsidiaries at the respective dates on which investments in such subsidiaries was made is recognised in the financial statements as goodwill and any excess of assets over the investment of the Group in a subsidiary is transferred to Capital reserve. The Group’s portion of equity in the subsidiaries is determined on the basis of the book value of assets and liabilities as per the financial statements of the subsidiaries as on the date of the investment. The financial statements of the Parent Company and its subsidiaries have been combined on a line-by-line basis by adding together the book values of like items of assets, liabilities, income and expenses, after eliminating intra-group balances / transactions and resulting unrealised profits in full. The amounts shown in respect of reserves / accumulated losses comprise the reserve / accumulated losses as per the balance sheet of the Parent Company and its share in the post-acquisition increase / decrease in the relevant reserve / accumulated losses of the subsidiaries.

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The amount of goodwill and capital reserve are presented on a net basis for each Subsidiary.

Minority interest’s share of profits or losses is adjusted against the income to arrive at the net income attributable to the shareholders. Minority interests’ share of net assets is disclosed separately in the Summary statements of the Group.

Joint venture entities

Interests in jointly controlled entities are accounted for using proportionate consolidation method.

The group consists of

Name of the entity Date of gaining control

Country of Incorporation

Ownership interest

Period 2012

Ownership interest

Period 2011

Ownership interest

Period 2010

Ownership interest

Period 2009

Ownership interest

Period 2008

Ownership interest

Period 2007 Subsidiaries / Step down Subsidiaries / Joint ventures / Associates

Reliance MediaWorks Entertainment Services Limited (formerly known as Digital Media Imaging Limited)

4 May 2009 India 100% 100% 100% - - -

Reliance Media Consultant Private Limited

16 February 2012

India 100% - - - - -

Reliance MediaWorks Theatres Limited (formerly known as Adlabs Distributors and Exhibitors Limited )

19 May 2003 India 100% 100% 100% 100% 100% 100%

Big Synergy Media Limited 12 January 2007

India 51% 51% 51% 51% 51% 51%

Sri Ramakrishna Theatres Limited (Refer Note 10 below)

11 January 2008

India N.A. 89.68% 89.68% 89.68% 89.16% -

Reliance MediaWorks (UK) Limited 19 May 2006 United Kingdom

100% 100% 100% 100% 100% 100%

208

Name of the entity Date of gaining control

Country of Incorporation

Ownership interest

Period 2012

Ownership interest

Period 2011

Ownership interest

Period 2010

Ownership interest

Period 2009

Ownership interest

Period 2008

Ownership interest

Period 2007 Subsidiaries / Step down Subsidiaries / Joint ventures / Associates

Reliance MediaWorks (USA) Inc. 17 May 2006 United States of America

100% 100% 100% 100% 100% 100%

Reliance MediaWorks (Netherlands) B.V.

8 February 2008

The Netherlands 100% 100% 100% 100% 100% -

Reliance MediaWorks (Mauritius) Limited

20 March 2008 Mauritius 100% 100% 100% 100% 100% -

Rave Entertainment and Food Nepal Private Limited

24 August 2008

Nepal 100% 100% 100% 100% - -

Big Cinemas Entertainment LLC 19 December 2007

United States of America

100% 100% 100% 100% 100% -

Big Cinemas Entertainment (DE) LLC

24 January 2008

United States of America

100% 100% 100% 100% 100% -

Adlabs Forum LLC (Refer note 7 below)

6 March 2008 United States of America

NA NA NA 100% 100% -

Big Cinemas Laurel LLC 28 November 2007

United States of America

100% 100% 100% 100% 100% -

Big Cinemas Falls Church LLC 8 November 2007

United States of America

100% 100% 100% 100% 100% -

Adlabs Heritage LLC (Refer note 7 below)

7 March 2008 United States of America

NA NA 100% 100% 100% -

209

Name of the entity Date of gaining control

Country of Incorporation

Ownership interest

Period 2012

Ownership interest

Period 2011

Ownership interest

Period 2010

Ownership interest

Period 2009

Ownership interest

Period 2008

Ownership interest

Period 2007 Subsidiaries / Step down Subsidiaries / Joint ventures / Associates

Big Cinemas Norwalk LLC 14 March 2008 United States of America

100% 100% 100% 100% 100% -

Big Cinemas Galaxy LLC (Refer note 8 below)

21 December 2007

United States of America

100% 100% 51% 51% 51% -

Big Cinemas Sahil LLC 13 November 2007

United States of America

97% 97% 97% 100% 100% -

Big Cinemas SAR LLC 8 November 2007

United States of America

51% 51% 51% 51% 51% -

Phoenix Big Cinemas Management LLC

25 February 2008

United States of America

51% 51% 51% 51% 51% -

Big Cinemas Union LLC (Refer note 7 below)

8 February 2008

United States of America

NA NA NA 100% 100% -

Big Cinemas Phoenix LLC 22 February 2008

United States of America

51% 51% 51% 51% 51% -

Big Cinemas Exhibitions LLC 6 March 2008 United States of America

100% 100% 100% 100% 100% -

Big Cinemas IMC LLC 19 January 2008

United States of America

100% 100% 100% 100% 100% -

Reliance Lowry Digital Imaging Services Inc. (Refer note 9 below)

1 September 2008

United States of America

100% 100% 100% 90% - -

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Name of the entity Date of gaining control

Country of Incorporation

Ownership interest

Period 2012

Ownership interest

Period 2011

Ownership interest

Period 2010

Ownership interest

Period 2009

Ownership interest

Period 2008

Ownership interest

Period 2007 Subsidiaries / Step down Subsidiaries / Joint ventures / Associates

Big Pictures USA Inc 30 March 2009 United States of America

100% 100% 100% 100% - -

Adlabs Digital Media LLC (Refer note 7 below)

27 March 2009 United States of America

NA NA 100% 100% - -

Reliance Media and Marketing Communications LLC

13 May 2009 United States of America

100% 100% 100% - - -

Adlabs GlobalStar LLC (Refer note 7 below)

23 September 2009

United States of America

NA NA NA - - -

Reliance Media Works VFX Inc. 25 January 2010

United States of America

100% 100% 100% - - -

Reliance MediaWorks (Malaysia) Sdn. Bhd.

18 April 2008 Malaysia 100% 100% 100% 100% - -

Big Cinemas Lotus Five Star Sdn. Bhd.

1 November 2008

Malaysia 70% 70% 70% 70% - -

Adlabs Multiplex Limited (Refer note 1 below)

20 December 2007

India - - - - 100% -

Rave Entertainment Private Limited (Refer Note 2 below)

31 May 2007 India - - - - 100% -

Adlabs Multiplexes and Theatres Limited (Refer Note 3 below)

1 April 2006 India - - - - 100% 100%

211

Name of the entity Date of gaining control

Country of Incorporation

Ownership interest

Period 2012

Ownership interest

Period 2011

Ownership interest

Period 2010

Ownership interest

Period 2009

Ownership interest

Period 2008

Ownership interest

Period 2007 Subsidiaries / Step down Subsidiaries / Joint ventures / Associates

Katch 22 Entertainment Private Limited (Refer Note 4 below)

23 April 2007 India - - - - - 100%

Reliance Broadcast Network Limited (Refer Note 5 below)

27 March 2006 India - - - - 100% -

Joint ventures

Adlabs Multiplex Limited (Refer Note 1 below)

NA India - - - - - 50%

Swanston Multiplex Cinemas Private Limited

NA India 50% 50% 50% 50% 50% 50%

Divyashakti Marketing Private Limited

NA India 50% 50% 50% 50% 50% 50%

Cineplex Private Limited (Refer Note 11 below)

NA India NA 50% 50% 50% 50% 50%

Associates

Sultan Production Private Limited (Refer Note 6 below)

NA India - - NA 49% 49% -

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Notes:

Note 1 – Adlabs Multiplex Limited (‘AML’) was accounted as a Joint venture during Period 2007 and part of Period 2008. During Period 2008, the balance outstanding shares of AML were acquired by the Parent Company and AML became a 100% subsidiary of the Parent Company. During Period 2009, effective from 1 April 2008, AML was amalgamated with the Parent Company as per Scheme of Amalgamation for merger of wholly owned subsidiaries.

(Refer note 2 of III of E of Annexure IV for details of Scheme of Amalgamation of AML with the Parent Company)

Note 2 – Rave Entertainment Private Limited (‘REPL’) was amalgamated with the Parent Company during Period 2009, effective 1 April 2008 as per Scheme of Amalgamation for merger of wholly owned subsidiaries. (Refer note 2 of IV of E of Annexure IV for details of acquisition of shares of REPL by the Group and note 2 of III of E of Annexure IV for details of Scheme of Amalgamation of REPL with the Parent Company)

Note 3 - Adlabs Multiplexes and Theatres Limited (‘AMTL’) was a joint venture of the Parent Company up to 1 April 2006 with the Parent Company holding 50% interest in the Joint venture. Subsequently, the Parent Company acquired the balance shares of AMTL and AMTL became a wholly owned subsidiary of the Parent Company effective 1 April 2006. During Period 2009, effective from 1 April 2008, AMTL was amalgamated with the Parent Company as per Scheme of Amalgamation for merger of wholly owned subsidiaries. (Refer note 2 of III of E of Annexure IV for details of Scheme of Amalgamation of AMTL with the Parent Company).

Note 4 – Katch 22 Entertainment Private Limited (‘Katch 22) was merged with the Parent Company during period 2008 with effect from 1 April 2006 as per Scheme of Amalgamation of Katch 22 with the Parent Company. (Refer note 3 of IV of E of Annexure IV for details of Scheme of Amalgamation). The shares of Katch-22 were acquired effective 23 April 2007 and transactions of Katch 22 were not considered as part of consolidated financial statements of Period 2007. However, no restatement adjustments have been made pertaining to consideration of balances of Katch 22 in financial statements of Period 2007.

Note 5 – Reliance Broadcast Network Limited (‘RBNL’) was considered as a subsidiary of the Parent Company till 31 March 2006. During Period 2007, as per Composite Scheme of Amalgamation and Arrangement, the Radio Business of the Parent Company was to be demerged to Reliance Broadcast Network Limited and the investment of the Group in RBNL was to be cancelled. The Composite Scheme of Amalgamation and Arrangement was given effect to in the financial statements for Period 2007, on an in-principle basis and RBNL was not consolidated as a subsidiary for those financial statements. Subsequently, the Company modified the Composite Scheme of Amalgamation and Arrangement, vide Modified Composite Scheme of Amalgamation and Arrangement which was given effect to in the financial statements for Period 2008 and accordingly RBNL was considered a subsidiary of the Parent Company and consolidated in the results for Period 2008. During Period 2009, the Radio Business of the Company was demerged to RBNL as per Scheme of Arrangement and the investment of the Parent Company in the shares of RBNL was deemed to be cancelled. Accordingly RBNL was not considered as a subsidiary for the financials of Period 2009. (Refer note 1 of IV of E of Annexure IV for details of Scheme of demerger of Radio business pursuant to Scheme of Arrangement)

Note 6 – The Company's stake in share capital of Sultan Production Private Limited ('Sultan') is in excess of 20%. This investment was made by the Company with the intention of investment in the movie "Sultan: The warrior". However, during the Period 2010, the Company has issued a letter of termination and demanded refund for the moneys paid by the Company towards production of the movie in the Joint venture and sale of shares held by the Company to Orcher Studios Private Limited, as per a shareholders agreement signed by the Company, which has been agreed to Orcher Studios Private Limited. Since, the Company has the intention of selling the shares, the Company has decided not to consider Sultan as an associate under AS-18 Related Party Disclosures and AS-23 'Accounting for Associates in consolidated financial statements. During Period 2011, the shares in Sultan Production Private Limited have been sold by the Group Note 7 – These Companies have been dissolved during the Period 2010 / Period 2011.

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Note 8 – During Period 2011, as part of settlement with the minority holders, the Group has acquired the balance 49% stake in Big Cinemas Galaxy LLC. Note 9 – During Period 2010, the Parent Company, acquired the balance 10% of the shares of Reliance Lowry Digital Imaging Services Inc. from the external shareholders. The balance 90% of the shares are held by Reliance MediaWorks (USA) Inc., a wholly owned subsidiary of the Parent Company. Note 10 – During Period 2012 on 3 June 2011, the Parent Company, sold its shareholding in Sri Ramakrishna Theaters Limited (‘SRTL’) comprising of 403,574 equity shares aggregating 89.68% of the issued equity share capital of SRTL, whereupon SRTL has ceased to be subsidiary of the Company. Note 11 – During Period 2012 on 27 May 2011, the Parent Company, sold its shareholding in Cineplex Private Limited (‘CPL’) comprising of 250,000 equity share aggregating 50.00% of the issued equity share capital of CPL, whereupon CPL has ceased to be joint venture of the Company.

3. Use of estimates The preparation of financial statements in conformity with generally accepted accounting principles (‘GAAP’) in India requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities on the date of the financial statements and the reported amount of income and expenses during the reported period. The estimates and assumptions used in the accompanying summary statements are based upon managements’ evaluation of relevant facts and circumstances as at the date of the summary statements, which in its opinion are prudent and reasonable. Actual results could differ from those estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

4. Goodwill on consolidation The excess of cost to the Parent Company of its investments over its portion of equity in the subsidiaries / associates / joint ventures, as at the date on which the investment was made, is recognised as goodwill in the summary statements of the Group. The Group’s portion of equity in the subsidiaries / associates / joint ventures’ is determined on the basis of the book value of assets and liabilities as per the financial statements of the subsidiaries as on the date of investment. Goodwill is reviewed for a decline other than temporary in its carrying value, whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The Group assesses the recoverability of goodwill by reference to the valuation methodology adopted by it on the acquisition date, which included strategic and synergic factors that were expected to enhance the enterprise value. Accordingly, the Group would consider that there exists a decline other than temporary in the carrying value of goodwill when, in conjunction with its valuation methodology, its expectations with respect to the underlying acquisitions it has made deteriorates with adverse market conditions.

5. Fixed assets and depreciation / amortisation

a. Tangible assets Tangible fixed assets are stated at cost and / or revalued amount in accordance with Scheme of Amalgamation less accumulated depreciation and any provision for impairment. Cost includes freight, duties, taxes (other than those recoverable from tax authorities) and other expenses related directly / indirectly to the acquisition / construction and installation of the fixed assets and for bringing the asset to its working condition for its intended use. Depreciation on fixed assets is provided on the straight line method, at the rates prescribed in Schedule XIV to the Act, which, in management’s opinion, reflects the estimated useful lives of those fixed assets, except assets of subsidiaries and a

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Joint Venture, namely Reliance MediaWorks (USA) Inc. (including its subsidiaries), BIG Cinemas Loturs Five Star Sdn. Bhd., Reliance MediaWorks (UK) Limited and Swanston Multiplex Cinemas Private Limited and theatrical exhibition segment in India wherein depreciation is provided at following rates:

Leasehold improvements / buildings are depreciated over the lower of the useful life of the asset and the lease term, on a straight line basis.

Individual assets costing up to ` 0.05 lakhs are depreciated fully in the period of acquisition.

b. Intangible assets Intangible assets, all of which have been acquired / created and are controlled through custody or legal rights, are capitalised at cost, where they can be reliably measured. Where capitalised, intangible assets are regarded as having a limited useful economic life and the cost is amortised over the lower of useful life and ten years. Application software purchased, which is not an integral part of the related hardware, is shown as an intangible asset and amortised on a straight line basis over its useful life, not exceeding five / ten years, as determined by management. Film rights comprise negative rights and distribution rights in films and are for a contractually specified mode of exploitation, period and territory and are stated at cost less accumulated amortisation. Cost of film rights comprises original purchase price / minimum guarantee. Cost is ascertained on specific identification basis where possible. In case multiple films / rights are acquired for a consolidated amount, cost is allocated to each film / right based on management’s best estimates. The individual film forecast method is used to amortise the cost of film rights acquired. Under this method, costs are amortised in the proportion that gross revenues realised bear to management’s estimate of the total gross revenues expected to be received. If estimates of the total revenues and other events or changes in circumstances indicate that the realisable value of a right is less than its unamortised cost, a loss is recognised for the excess of unamortised cost over the film right’s realisable value. In respect of unreleased films, payments towards film rights are classified under capital advances as the amounts are refundable in the event of non-release of the film. Internally generated software is capitalised by the Group and amortised over its estimated useful life of five / ten years. Purchased goodwill is recognised by the Group on the basis of excess of purchase consideration paid over the fair value of assets acquired at the time of acquisition of business and is amortised over, its estimated useful life not exceeding ten years.

6. Impairment In accordance with AS 28 – ‘Impairment of Assets’, where there is an indication of impairment of the Group’s asset, the carrying amounts of the Group’s assets are reviewed at each Balance sheet date to determine whether there is any impairment. The recoverable amount of the asset (or where applicable, that of the cash generating unit to which the asset

Particulars of fixed assets Rate of depreciation Plant and machinery 7.07% to 20% Furniture and fixture 10% to 25% Office equipments 10% Computers 20% Vehicles 10%

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belongs) is estimated as the higher of its net selling price and its value in use. An impairment loss is recognised whenever the carrying amount of an asset or a cash generating unit exceeds its recoverable amount. Impairment loss is recognised in the statement of profit and loss. If at the Balance sheet date there is an indicator that a previously assessed impairment loss no longer exists, the recoverable amount is re-assessed and the asset is reflected at the recoverable amount subject to a maximum depreciated historical amount. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life.

7. Investments

Long-term investments are carried at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of long-term investments and is determined separately for each individual investment.

Current investments are carried at lower of cost and fair value.

8. Inventories

Inventories (comprising of food and beverage items, chemicals, negative film rolls, xenon lamps and stores and spares related to theatrical exhibition / film production services business etc.) are stated at the lower of cost and net realisable value. Cost is determined on the first-in first-out (FIFO) basis except in the case of Reliance MediaWorks (USA), Inc. (and its subsidiaries), and BIG Cinemas Lotus Five Star Cinemas Sdn. Bhd. wherein the Group uses the weighted average method.

Inventory of DVD’s is stated at lower of cost or net realisable value, wherein cost is determined using weighted average method.

Inventory of content cost not aired is stated at lower of cost and net realisable value.

9. Employee benefits Short term employee benefits: All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised as an expense during the period. Long term employee benefits: Provident fund and other schemes The Group’s state governed provident fund scheme, employee state insurance scheme and labour welfare fund are defined contribution plans. The contribution paid / payable under the schemes is recognised during the Period in which the employee renders the related service. Gratuity Plan The Group’s gratuity benefit scheme is a defined benefit plan. The Group’s net obligation in respect of the gratuity benefit scheme is calculated by estimating the amount of future benefit that employees have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value and the fair value of any plan assets is deducted.

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The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected unit credit method. The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government securities as at the Balance sheet date. Actuarial gains and losses are recognised immediately in the statement of profit and loss. Other Long term employment benefits: Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as a liability at the present value of the defined benefit obligation at the Balance sheet date, determined based on actuarial valuation using Projected unit credit method. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government securities as at the Balance sheet date.

10. Revenue recognition Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured. The amount recognised as revenue is exclusive of value added tax, service tax and net of trade discounts. Amount of entertainment tax is shown as a reduction from revenue. Film production services Revenue from processing / printing of cinematographic films is recognised upon completion of the related processing / printing. Revenue from processing of digital content is recognised using the proportionate completion method. Use of the proportionate completion method requires the Group to estimate the efforts expended to date as a proportion of the total efforts to be expended. Efforts expended have been used to measure progress towards completion, as there is a direct relationship between efforts expended and contracted output. Sale of traded goods is recognised when the risks and rewards of ownership are passed on to the customer, which generally coincides with the dispatch of goods.

Income from equipment / facility rental is recognised over the period of the relevant agreement / arrangement.

Theatrical exhibition and related income

Sale of tickets

Revenue from theatrical exhibition is recognised on the date of the exhibition of the films and comprises proceeds from sale of tickets, gross of entertainment tax. As the Group is the primary obligor with respect to exhibition activities, the share of distributors in these proceeds is separately disclosed as Distributors’ share.

Amount of entertainment tax is shown as a reduction from revenue where applicable.

Revenue from gift cards is recognised on the basis of availing the facility by the customer. At the time of sale, the amounts received are recognised as deferred revenue.

Share of profit in partnership firm is recognised on the basis of audited financial statement of the Partnership firm.

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Sale of food and beverages

Revenue from sale of food and beverages is recognised upon sale and delivery at the counter.

Advertisement / sponsorship revenue

Revenue from advertisements, sponsorship and events is recognised on the date of the exhibition of the advertisement / event or over the period of the contract or on completion of the Group’s obligation, as applicable.

Management fee is recognised as revenue on a time proportion basis as per the relevant agreement.

Television / film production, distribution and related income

Television / Film content production and related income

Revenue from sale of content / motion picture is accounted for on the date of agreement to assign / sell the rights in the concerned motion picture / content or on the date of release of the content / motion picture, whichever is later. Program sales are accounted on the delivery of tape to the channel.

Income from film distribution activity

In case of distribution rights of motion picture / content, revenue is recognised on the date of release / exhibition.

Revenue from other rights such as satellite rights, overseas rights, music rights, video rights, etc. is recognised on the date when the rights are made available to the assignee for exploitation.

Revenue from sale of VCDs / DVDs, etc is recognised when the risks and rewards of ownership are passed on to the customer, which generally coincides with the dispatch of the products.

Interest income / income from film financing

Interest income, including from film / content related production financing, is recognised on a time proportion basis at the rate implicit in the transaction.

Dividend income

Dividend income is recognised when the right to receive dividend is unconditional at the balance sheet date.

Marketing Rights / Rights to profit

Amounts received in lieu of future marketing rights sale, right to future profit from business of the Group and other rights are recognised as income in the period of entering into the contract.

11. Foreign currency transactions Transactions denominated in foreign currency are recorded at the exchange rate prevailing on the date of the transactions. Exchange differences arising on foreign exchange transactions settled during the period are recognised in the statement of profit and loss of the period. Monetary assets and liabilities denominated in foreign currencies as at the balance sheet date are translated at the closing exchange rates on that date; the resultant exchange differences are recognised in the statement of profit and loss except in case of exchange differences arising on translation of monetary items which form part of Group’s net investment in a non-integral foreign operation which is accumulated in a ‘Foreign currency translation reserve’ until its disposal.

218

Non-monetary items which are carried at historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction. Forward contracts are entered into to hedge the foreign currency risk of the underlying transaction. The premium or discount on all such contracts arising at the inception of each contract is amortised as income or expense over the life of the contract. Exchange difference on forward contracts is recognised as income or expense in the statement of profit and loss of the period. Any profit or loss arising on the cancellation and renewal of forward contract is recognised as income or expense for the period.

12. Foreign currency translation The consolidated financial statements are reported in Indian rupees in accordance with AS-11 – ‘The Effects of Changes in Foreign Exchange Rates’ which specifies translation of foreign subsidiaries on the basis of their classification as integral / non-integral to the operations of the Parent Company. Local currency financials of each integral foreign subsidiary within the Group into Indian Rupees is performed in respect of assets and liabilities other than fixed assets, using the exchange rate in effect at the balance sheet date and for revenue and expense items other than the depreciation costs, using average exchange rate during the reporting period. Net exchange difference resulting from the above translation of the financial statements of integral foreign subsidiaries is recognised in the consolidated statement of profit and loss. Fixed assets are translated at exchange rates on the date of the transaction and depreciation on fixed assets is translated at exchange rates used for translation of the underlying fixed assets. Translation of local currency balances of each non-integral foreign subsidiary within the Group into Indian Rupees is performed in respect of assets and liabilities at the exchange rate in effect at the Balance sheet date and for revenue and expense items at the average exchange rate during the reporting period. Net exchange differences resulting from the above translation of the financial statements is accumulated in a ‘Foreign currency translation reserve’, disclosed as Reserves and surplus. The amount accumulated will be held in this account till the time of disposal of the net investment in the subsidiary.

13. Earning per share In determining earning per share, the Group considers the net result after tax and includes the post tax effect of any extraordinary / exceptional item. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the period. The number of shares used in computing diluted earning per share comprises the weighted average number of shares considered for deriving basic earnings per share and also the weighted average number of shares that could have been issued on the conversion of all dilutive potential equity shares unless the results would be anti-dilutive. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date.

14. Taxation

Income-tax expense comprises current tax expense and fringe benefit tax computed in accordance with the relevant provisions of the Income tax Act, 1961 / local Income tax regulations of the respective countries of operation of the Group and deferred tax charge or credit.

Current tax provision is made based on the tax liability computed after considering tax allowances and exemptions, in accordance with the Income tax Act, 1961 / local Income tax regulations of the respective countries of operation of the Group. Deferred tax charge or credit and the corresponding deferred tax liability or asset is recognised for timing differences between the profits / losses offered for income tax and profits / losses as per the financial statements. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted at the Balance sheet date.

Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realised in future. However, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are

219

recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at each Balance sheet date and written down / up to reflect the amount that is reasonably / virtually certain (as the case may be) to be realised.

Provision for fringe benefit tax is made on the basis of applicable rates on the taxable value of eligible expenses of the Group as prescribed under the Income Tax Act, 1961 till Period 2009 on the basis of applicability.

15. Share issue / Foreign Currency Convertible Bonds (FCCB) issue expenses and premium on redemption.

Share / FCCB issue expenses incurred and premium payable on FCCB are adjusted in the period of issue against the Securities premium reserve.

16. Provisions and contingencies

Provisions comprise liabilities of uncertain timing or amount. Provisions are recognised when the Group recognises it has a present obligation as a result of past events, it is more likely than not that an outflow of resources will be required to settle the obligation and the amount can be reasonably estimated.

A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

Loss contingencies arising from claims, litigation, assessment, fines, penalties, etc. are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated.

17. Leases

Rental expenses in non-cancellable arrangements / agreements with scheduled rent increases are recorded on a straight line basis over the lease term.

18. Borrowing costs Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

19. Commercial papers Commercial papers issued are recognised as a liability, at the amount of cash received at the time of issuance i.e. discounted value. The discount is amortised as interest cost over the period of the commercial paper, at the rate implicit in the transaction.

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B. Significant changes in accounting policies and other adjustments (debited) / credited to the restated financial statements:

(` in lakhs)

Particulars Refer Note

below

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Adjustment to opening balance in

the statement of profit and loss as at

1 April 2006 (Loss) / profit after tax as per audited financial statements

(54,592.50) (32,886.10) (14,320.80) (5,787.10) 4,731.50 9,048.80

Balances as per audited financial statements 2,817.55

Adjusted for

Change in depreciation method (a) - - (130.28) (853.29) 371.29 78.08 386.08

Change in estimated useful life (b) - - - - - (85.91) (132.86)

Restatement of FCCB’s (c) - 1,272.40 1,718.10 (1,130.10) (1,860.40) - -

Prior period adjustment (net) (d) - - - - (0.40) - 0.40

Effect of qualification – deferred revenue expenditure

(e) 346.79 (1,734.00) - - - - -

Effect of qualification – loss on derivative contracts (f) (2,435.27) - - - - - -

Effect of subsidiaries not consolidated in previous periods

(g) - - - - - 36.62 (36.62)

Miscellaneous expenditure not written off, adjusted in opening balance

(h) - 2.50 2.56 0.74 9.45 3.26 (18.51)

Prior period – tax

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Particulars Refer Note

below

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Adjustment to opening balance in

the statement of profit and loss as at

1 April 2006 Excess / (short) provision for tax (i) 0.16 12.44 (72.66) (10.31) (10.61) 9.64 71.34

Excess / (short) provision for Minimum alternative tax

(i) - - - - (1,242.60) 1,242.60 -

Net impact of all adjustments (2,088.32) (446.66) 1,517.72 (1,992.96) (2,733.27) 1,284.29 269.83

Current tax impact of adjustments

Deferred tax impact of adjustments (i) (535.81) 535.81 - (6.46) 0.29 85.32 (85.26)

(Loss) / Profit after tax as per restatement (57,216.63) (32,796.95) (12,803.08) (7,786.52) 1,998.52 10,418.41

Balances as per restatement 3,002.12

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a) Change in accounting policy for depreciation During Period 2009, the Group has charged depreciation as per the written down value method in the film production services, production and distribution business and for unallocated assets at the rates specified in Schedule XIV of the Companies Act, 1956 till 31 March 2008. Starting 1 April 2008, the Group has changed its policy to charge depreciation as per the straight line method at the rates specified in Schedule XIV of the Companies Act, 1956. Accordingly, depreciation charge for the previous period’s has been restated based on the new method and the impact of change in depreciation method for the period prior to 1 April 2006 has been adjusted to opening balance of the surplus in statement of profit and loss, as restated as on 1 April 2006.

b) Change in estimated useful life of assets

The Group had revised the estimated useful life of certain fixed assets pertaining to the theatrical exhibition business from 1 July 2007, since in the opinion of the management, the revised useful life reflect the estimated period of economic benefit to be derived from the use of such assets. For the purpose of statements, depreciation has been recomputed based on the revised useful life of the assets from the date of capitalisation of these assets. Accordingly, depreciation for the Period 2007 has been restated and depreciation for the period prior to 1 April 2006 has been adjusted to opening balance of the surplus in statement of profit and loss, as restated as on 1 April 2006.

c) Accounting for Foreign Currency Convertible Bonds (‘FCCB’) During Period 2008, the liability for FCCB’s had been reclassified as a non-monetary liability inter-alia on the basis of the trend of earnings, movement of the Parent Company’s share prices and conversion option exercised by the FCCB holders (bondholders holding 75.42% of the FCCB had exercised conversion option as of 31 March 2008). However, during Period 2011, the balance FCCB’s were redeemed at a premium, as per the terms of the issue document. The Company had reversed foreign exchange fluctuation loss aggregating to ` 438.06 lakhs in Period 2008 based on the consideration of FCCB’s as a non-monetary liability. This position was carried forward till Period 2010 and was a matter of emphasis referred to in the auditors report for Period 2008, 2009 and 2010. Hence, the Company has reversed the reversal made during Period 2008 and recognised the loss / gain on the non-converted portion of FCCB’s, considering them as a monetary item in Period 2008, 2009 and 2010 and reversed this loss in Period 2011, wherein the Company has recognised the entire loss on redemption in its audited financial statements.

d) Prior period adjustments (net) Prior period adjustments pertain to under accrual of expenses by Subsidiaries and Joint ventures. The amount pertains to period’s prior to 1 July 2006 and hence the same has been adjusted against the opening balance of the surplus in statement of profit and loss, as restated as of 1 April 2006.

e) Deferred revenue expenditure Reliance MediaWorks Entertainment Services Limited, a subsidiary of the Group had recognised deferred revenue expenditure for start up and stabilisation costs during Period 2011, which was a subject matter of qualification by the auditors of the Subsidiary in Period 2011. The Group has reversed the accounting treatment followed by the Subsidiary regarding recognition of deferred revenue expenditure and has appropriately charged off the expenditure in the Statement of profit and loss, as restated. The deferred revenue expenditure was amortised over a period of 5 years starting Period 2012, which has been appropriately reversed in the Statement of profit and loss, as restated of Period 2012.

223

f) Effect of qualification - Loss on derivate contracts

After the balance sheet date, considering the adverse foreign exchange fluctuation and interest rates, the Company had terminated the assigned derivative contracts pertaining to interest rate swap after the period ended 31 March 2012 i.e. on 3 April 2012. The Company had incurred loss of ` 2,435.27 lakhs on pre-mature termination of this contract. The same will be accounted by the Company in the next period being loss for the next period. Since this was the subject matter of qualification in the Auditors’ Report on the financial statements for Period 2012, this has been adjusted in the Statement of Profit and loss, as restated for the current period.

g) Cineplex Private Limited (a Joint venture) of the Company was not considered for the consolidated accounts of the year ended 31 March 2006 and the net result of the operations for the period prior to 31 March 2006 were debited to the statement of profit and loss, as restated for Period 2007. The Group has appropriately restated the net result of the period prior to 31 March 2006 to the opening balance surplus of statement of profit and loss, as restated as on 1 April 2006.

h) Miscellaneous expenditure not written-off The Group has written off the balances of miscellaneous expenditure as of 1 April 2006 to the opening balance of surplus of statement of profit and loss, as restated as on 1 April 2006 and has consequently reversed the charge made for write off made in Period 2007, 2008, 2009, 2010 and 2011.

i) Tax impact on restatement The statement of profit and loss, as restated of some periods include amounts paid / provided for or refunded / written back, in respect of shortfall / excess income tax (including fringe benefit tax) arising out of assessments, appeals etc. which has now been adjusted in the respective period’s tax liability. Also, income tax (current tax and deferred tax) has been computed on adjustments made and has been adjusted accordingly in the statement of profit and loss, as restated for the respective periods.

j) Consequent to the notification of the Companies (Accounting Standards) Rules, 2006, with effect from 1 July 2007, the Group adopted Accounting Standard (AS 15) - Employee Benefits. However, there was no significant impact on adoption of the Standard which is required to be adjusted to the opening balance of reserves and surplus.

k) Adjustments have been made in the Restated Summary Statements, wherever required, by a reclassification of the corresponding items of income, expenses, assets and liabilities, in order to bring them in line with the groupings as per the audited financials of the Group for Period 2012 as prepared under Government Notification no. S.O. 447 (E) dated 28 February 2011 (as amended by notification no. F.No/2/6/2008-CL-V dated 30 March 2011), read with General Circular no. 62/2011 dated 5 September 2011, issued by the Ministry of Company Affairs.

l) The Company in Period 2009 has classified its operations in US and in Period 2010 its operations in Nepal as non-integral to the operations of the Parent Company in India. The impact of this change is not material on the results of respective periods and hence, no restatement has been made for the same.

m) De-merger of Radio Business

During the year ended 31 March 2006 the Company commenced operations of the Radio business. The Company was granted 45 FM Radio operation licenses in various parts of India including all metros.

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During Period 2007, the Board of Directors and members of the Company and the Hon’ble High Court of Judicature at Bombay approved the Composite Scheme of Amalgamation and Arrangement (‘Composite Scheme’) which among other things provided for demerger of the Radio business of the Company to Reliance Broadcast Network Limited with effect from 1 April 2006. The Company had given the in-principle effect of the Composite Scheme including the demerger of the Radio business of the Company to Reliance Broadcast Network Limited in the accounts for Period 2007 pending filing of the Scheme with the Registrar of Companies. Subsequently, due to non-receipt of approval from the Ministry of Information and Broadcasting, the Company filed the Modified Composite Scheme of Amalgamation and Arrangement (the ‘Modified Composite Scheme’) which provided for reversal of the effect of demerger, of the Radio business that was given effect to in the accounts for the Period 2007 and provided for adjusting the net result of the transactions related to Radio business for the period 31 March 2006 till the effective date of the Modified Composite Scheme i.e. 31 March 2008 in the General reserve account of the Company.

During Period 2009, the Board of Directors and members of the Company and the Hon’ble High Court of Judicature at Bombay approved a Scheme of Arrangement which provides for demerger of the Radio business of the Company effective 1 April 2008 to Reliance Broadcast Network Limited. Accordingly, transaction related to Radio business does not form part of the statement of profit and loss, for the Period 2007 and 2008. However, the assets and liability were included in the summary statement of assets and liability in Period 2008. The assets and liabilities of the Radio business for Period 2008 which are included in the statement of assets and liability of the Group are:

Particulars Period 2008 (`̀ in lakhs)

Fixed assets Gross block 32,728.23 Less: Accumulated depreciation 3,845.38 Net block 28,882.85 Capital work in progress 2,309.17 Current assets Inventories 17.67 Sundry debtors 6,679.51 Cash and bank balances 843.71 Loans and advances 6,387.06 13,927.95 Current liabilities and provisions Current liabilities 4,348.71 Provisions 626.94 4,975.65 Net working capital 8,952.30 Less: Loans 2,046.28

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Particulars Period 2008 (`̀ in lakhs)

Net Capital employed 38,098.04

(Refer note 1 of VI of E of Annexure IV for details of the Composite Scheme of Amalgamation and Arrangement given effect to in the accounts of the Company for Period 2007, note 1 of V of E of Annexure IV for details of the Modified Composite Scheme of Amalgamation and Arrangement giving effect to in the accounts of the Company for Period 2008 and note Refer note 1 of IV of E of Annexure IV for details of the Scheme of arrangement given effect to in the accounts of the Group for Period 2009)

C. Auditors’ qualification

a. Period 2012

i. As reproduced below, auditors have qualified their audit report for Period 2012 for loss on derivative contracts

We draw attention to Note 34 to the condensed financial statements regarding accounting treatment for loss on cancellation of derivative contract. Post period end, the Company has cancelled its assigned derivative contract and a loss aggregating to ` 2,435.27 lakhs has devolved on the Company. As explained in the said Note, the Company has not accounted for this loss as required by the principles of prudence as enunciated in Accounting Standard 1- Disclosure of Accounting Policies. Consequently, the loss on derivative contract aggregating to ` 2,435.37 lakhs has not been recognised by the Group during the twelve months period ended 31 March 2012. The management has adjusted the effect of the qualification in the restated statements.

(Refer note (f) of B of Annexure IV for effect of restatement of the qualification)

ii. As reproduced below, auditors have qualified their audit report for Period 2012 for recognition of deferred revenue expenditure

We draw attention to Note 48 to the condensed financial statements regarding recognition of Deferred Revenue Expenditure aggregating to ` 1,387.20 lakhs pertaining to start-up and stabilization costs of the business, by Reliance MediaWorks Entertainment Services Limited (Formerly known as Digital Media Imaging Limited), a subsidiary of the Company. As opined by the auditor of the subsidiary, such recognition is not in accordance with Accounting Standard 26 – ‘Intangible Assets. (Refer note (e) of B of Annexure IV for effect of restatement of the qualification)

iii. As reproduced below, auditors have quantified the impact of qualifications stated above Had the Group recognised the above loss and such costs, the loss before tax and deficit in Statement of profit and loss as at period ended 31 March 2012 for the Group would be higher by ` 3,822.47 lakhs.

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b. Period 2011

i. As reproduced below auditors have qualified their audit report for Period 2011 for recognition of deferred revenue expenditure. The qualification is re-produced as follows:

As more fully explained in note 15 of Schedule 23 to the consolidated financial statements, the financial statements of Reliance MediaWorks Entertainment Services Limited, a subsidiary, has been qualified on account of treatment of start up and stabilisation costs of the film production services segment aggregating to ` 1,734.00 lakhs as deferred revenue expenditure, which is not in accordance with Accounting Standard 26 – ‘Intangible Assets’, prescribed in the Companies (Accounting Standards) Rules, 2006. Had the Subsidiary not followed the said accounting treatment, the loss for the current year would have been higher by ` 1,734.00 lakhs and consequentially the Debit balance in Profit and Loss Account would have been higher by ` 1,734.00 lakhs. The management has adjusted the effect of the qualification in the restated statements of the Group.

(Refer note (e) of B of Annexure IV for effect of restatement of the qualification)

D. Extract of other matters / matter of emphasis referred by auditors in their reports as reproduced below:

A. Period 2012 i) Without qualifying our report, We draw attention to note 38 to the condensed consolidated financial

statements; the Group’s net worth is fully eroded and has a negative net worth of ` 19,762.50 lakh, the Group has incurred a loss of ` 54,592.50 lakhs for the period 1 April 2011 to 31 March 2012, indicating the existence of uncertainty that may cast doubt about the Group’s ability to continue as a going concern. Considering the matters set out in the said note, this condensed consolidated financial statement is prepared on a going concern basis. (Refer note 6 of I of E of Annexure IV)

B. Period 2010

i) Without qualifying our report, we draw attention to note 8 of schedule 22 to the financial statements

regarding accounting of the Foreign Currency Convertible Bonds (‘FCCB’). During the financial period ended 31 March 2008, the Company re-classified the liability towards FCCB as non–monetary liability inter-alia on the basis of the trend of earnings, movement of the Company’s share prices and conversion option exercised by the FCCB holders. The Company continues to classify the liability towards FCCB as non–monetary liability as in its view the current fall in the market price of the Company’s share price and non-conversion by bond holders is a temporary aberration, consequently, the foreign exchange fluctuation gain for the year aggregating ` 1,718.10 lakhs has not been recognised and the said liability has not been restated at the year-end exchange rate.

An alternate view exists that the liability towards FCCB is a monetary liability and should be restated at the year-end exchange rate in accordance with Accounting Standard 11 - ‘The Effects of Changes in Foreign Exchange Rates’ prescribed in the Companies (Accounting Standards) Rules, 2006. There is no specific guidance of The Institute of Chartered Accountants of India on accounting for foreign currency bonds convertible into equity shares at the option of the holder. Had the said liability been considered as a monetary liability as before, the loss before tax for the current year would be lower by ` 1,718.10 lakhs and the reserves and surplus would be lower by ` 1,272.30 lakhs.

(Refer note 5 of III of E of Annexure IV for note 17 of Schedule 22 which has been referred to above)

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(Refer note (c) of B of Annexure IV for subsequent recognition of FCCB’s as a monetary item)

C. Period 2009 i) Without qualifying our report, we draw attention to Note 10 of Schedule 22 to the consolidated

financial statements regarding accounting of the Foreign Currency Convertible Bonds (‘FCCB’). During the previous financial period ended 31 March 2008, the Company reclassified the liability towards FCCB as non–monetary liability inter-alia on the basis of the trend of earnings, movement of the Company’s share prices and conversion option exercised by the FCCB holders. The Company continues to classify the liability towards FCCB as non– monetary liability as in its view the current fall in the market price of the Company’s share price and non conversion by bond holders during the year is a temporary aberration, consequently, the foreign exchange fluctuation (net loss) for the year aggregating ` 1,130.10 lakhs has not been recognised and the said liability has not been restated at the period-end exchange rate.

An alternate view exists that the liability towards FCCB is a monetary liability and should be restated at the period-end exchange rate in accordance with Accounting Standard 11 - ‘The Effects of Changes in Foreign Exchange Rates’ prescribed in the Companies (Accounting Standards) Rules, 2006 issued by the Central government in consultation with the National Advisory Committee on Accounting Standards. There is no specific guidance of The Institute of Chartered Accountants of India on accounting for foreign currency bonds convertible into equity shares at the option of the holder. Had the said liability been considered as a monetary liability, the loss before tax for the current year would be higher by ` 1,130.10 lakhs and the reserves and surplus would be lower by ` 2,990.40 lakhs.

(Refer note 7 of IV of E of Annexure IV for note 10 of Schedule 22 which has been referred to above)

(Refer note (c) of B of Annexure IV for subsequent recognition of FCCB’s as a monetary item)

ii) Without qualifying our opinion, we draw attention to Note 2 of Schedule 22 to the financial statements. As more fully explained in the said Note, during the year, the Hon’ble High Court of Judicature at Mumbai vide its order dated 8 May 2009 sanctioned the Scheme of Amalgamation of the Company with its wholly owned subsidiaries Adlabs Multiplexes and Theatres Limited, Adlabs Multiplex Limited, Rave Entertainment Private Limited and Mahimna Entertainment Private Limited, under sections 391 to 394 of the Act. Pursuant to the said Scheme the Company has the made an adjustment for diminution in value of its assets (production and distribution rights, fixed assets, investments, debtors and loans and advances) aggregating ` 15,669.70 lakhs by debiting the same to capital reserve instead of the statement of profit and loss. Had the Company debited the statement of profit and loss the loss before tax for the year would be higher by the said amount.

(Refer note 2 of IV of E of Annexure IV for note 2 of Schedule 22 which has been referred to above)

D. Period 2008 i) Without qualifying our report, we draw attention to Note 1 of Schedule 22 to the financial statements.

As more fully explained in the said Note, during the period, the Hon'ble High Court of Judicature at Bombay vide its order dated 7 March 2008 sanctioned the Modified Composite Scheme of amalgamation and arrangement ('the Modified Scheme') between the Company, Entertainment One India Limited ('E-ONE') and Mukta Adlabs Digital Exhibition Private Limited ('MADEL')#. The Scheme was filed with the Registrar of Companies ('ROC') on 31 March 2008. Pending completion of licensing and other procedural formalities, the original Composite Scheme of amalgamation and

228

arrangement between the Company, E-ONE, MADEL#, Reliance Unicom Limited ('RUL')## and their respective shareholders and creditors sanctioned by the Hon'ble High Court of Judicature at Bombay vide its order dated 15 September 2006 was not filed with the Registrar of Companies ('ROC') as required under Section 391(3) of the Companies Act, 1956 ('the Act'). However, the said original Scheme was given effect to by the Company's management in the previous period's financial statements for the fifteen months ended 30 June 2007, so as to give effect to the substance of the Scheme as approved by the Hon'ble High Court of Judicature at Bombay. The Modified Scheme inter-alia provides that the net results of the transactions related to the radio business of the Company for the period from 31 March 2006 to the Effective date (i.e. the date of filing the Modified Scheme with the ROC) be adjusted in the General reserve account of the Company (the original scheme provided for the demerger of the radio business of the Company to RUL## effective 31 March 2006). As the original scheme was given effect to in the previous period's financial statements for the fifteen months ended 30 June 2007, only the modifications to the original scheme have been given effect to in the current period's financial statements (including reversal of demerger of radio business to RUL##).

# - The name of the Company was subsequently changed to Adlabs Multiplex and Theatres Limited

## - The name of the Company was subsequently changed to Reliance Broadcast Network Limited

(Refer note 1 of V of E of Annexure IV for note 1 of Schedule 22 which has been referred to above)

ii) Without qualifying our report, we draw attention to Note 16 of Schedule 22 to the financial

statements regarding accounting of the Foreign Currency Convertible Bonds ('FCCB'). During the current period, the Company reclassified the liability towards FCCB as non-monetary liability inter-alia on the basis of the trend of earnings and movement of the Company's share prices. Accordingly, the foreign exchange fluctuation (net loss) aggregating to ` 438.10 lakhs accounted in previous period has been reversed and the foreign exchange fluctuation loss for the current period aggregating to ` 3,621.80 lakhs has not been recognised by management and the said liability has not been revalued at the period-end exchange rate.

An alternate view exists that the liability towards FCCB is a monetary liability and should be revalued at the period-end exchange rate in accordance with Accounting Standard 11 - 'The Effects of Changes in Foreign Exchange Rates' prescribed in the Companies (Accounting Standard) Rules, 2006 issued by the Central Government in consultation with the National Advisory Committee on Accounting Standard. There is no specific guidance of The Institute of Chartered Accountants of India on accounting for foreign currency bonds convertible into equity shares at the option of the holder. Had the said liability been considered as a monetary liability as before, the profit after tax would be lower by ` 4,118.90 lakhs.

(Refer note 7 of V of E of Annexure IV for note 21 of Schedule 22 which has been referred to above) (Refer note (c) of B of Annexure IV for subsequent recognition of FCCB’s as a monetary item)

E. Period 2007

i) Without qualifying our report, we draw attention to note 1 of Schedule 22 to the financial statements. As more fully explained in the said Schedule, during the period, the Hon’ble High Court of Judicature at Bombay vide its order dated 15 September 2006 sanctioned a composite scheme of amalgamation and arrangement (‘the Scheme’) between the Company, Entertainment One India Limited (‘E-ONE’), Mukta Adlabs Digital Exhibition Private Limited (‘MADEL’)#, Reliance Unicom Limited (‘RUL’)## and their respective shareholders and creditors. The Scheme inter-alia provides for the following:

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the amalgamation of E-ONE with the Company effective 1 April 2005; the merger of the digital business of MADEL# with the Company effective 1 April 2005; and the demerger of the radio business of the Company to RUL## effective 31 March 2006.

As represented by the Company’s management, the Company has made an application to the Ministry of Information and Broadcasting for vesting of radio licenses held by it in the name of RUL##. Pending the said approval, the Scheme has not been filed with the Registrar of Companies (‘ROC’) as required under Section 391(3) of the Companies Act, 1956 (‘the Act’). However, for the purpose of these financial statements, pending completion of licensing and other procedural formalities, the Scheme has been given effect to by the Company’s management in view of the Court approval and to give effect to the substance of the Scheme as approved by the Hon’ble High Court of Judicature at Bombay. Management has represented that it is reasonably certain that the Scheme will be filed with the ROC in due course.

Also, we draw attention to note 8 of Schedule 22 to the financial statements. Should the Scheme referred to above not be made legally effective, remuneration paid / payable to the directors would be in excess of the limits prescribed under the Act and, consequently, necessary approval of the Central Government would be required to be obtained.

The ultimate outcome of the completion of the licensing and procedural formalities cannot be presently determined and hence, no adjustments have been made to the financial statements in case the Scheme is eventually / subsequently modified, nullified or replaced with the sanction of the Hon’ble High Court of Judicature at Bombay.

# - The name of the Company was subsequently changed to Adlabs Multiplex and Theatres Limited

## - The name of the Company was subsequently changed to Reliance Broadcast Network Limited

(Refer note 1 of VI of E of Annexure IV for note 1 of Schedule 22 which has been referred to above)

(Note 8 of Schedule 22 refers to the disclosure of directors remuneration in Period 2008, refer Annexure XVIII - Related Party Disclosure for amounts paid to Directors)

E. Extract of significant notes from audited financial statements

I. Period 2012

1. Lease disclosure under AS 19 – ‘Leases’

The Group is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the term of the respective agreements.

The future minimum lease payments in respect of non-cancellable operating lease are as follows:

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Amount payable within lock-in-period is ` 103,345.70 lakhs

Amount debited to statement of profit and loss for lease rental is ` 20,512.80 lakhs (excluding amount capitalised ` 228.20 lakhs).

2. After the balance sheet date, considering the adverse foreign exchange fluctuation and interest rates, the Company had terminated the assigned derivative contracts pertaining to interest rate swap after the period ended 31 March 2012 i.e. on 3 April 2012. The Company had incurred loss of ` 2,435.27 lakhs on pre-mature termination of this contract. The same will be accounted in the next period being loss for the next period.

3. Interest in Joint ventures

The Company’s interests in jointly controlled entities (incorporated Joint Ventures) are:

Name of the Company

Country of Incorporation

% of ownership interest as at 31

March 2012

Swanston Multiplex Cinemas Private Limited India 50%

Cineplex Private Limited (up to 3 June 2011) India Nil

Divyashakti Marketing Private Limited India 50%

Details of Joint venture

Particulars Period 2012 (`̀ in lakhs)

Balance Sheet EQUITY AND LIABILITIES Shareholders' funds

(a) Share capital 49.00 (b) Reserves and surplus (69.30)

Share application money, pending allotment 125.00 LIABILITIES Non-current liabilities

(a) Long-term borrowings 211.70 (b) Deferred tax liabilities (net) -

As at 31 March 2012

For the Parent Company / Subsidiaries companies Amounts due within one year from the Balance sheet date 16,788.80 Amounts due in the period between one year and five years 59,643.80 Amount due after five years 90,316.50 166,749.10 For Joint Ventures (Group's share)

Amounts due within one year from the Balance sheet date 176.90 176.90

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Particulars Period 2012 (`̀ in lakhs)

(c) Other long-term liabilities 1.80 (d) Long-term provisions 2.50

Current liabilities (a) Trade payables 110.10 (b) Other current liabilities 67.70 (c) Short-term provisions 9.10 Total 507.60

ASSETS Non-current assets

(a) Fixed assets Tangible assets (including capital work-in-progress) 257.30 (b ) Long-term loans and advances 73.30

Current assets (a) Inventories 5.10 (b) Trade receivables 37.00 (c ) Cash and bank balances 14.10 (d) Short-term loans and advances 108.80 (e) Other current assets 12.00 Total 507.60

Statement of profit and loss Revenue (a) Revenue from operations 831.90 (b) Other income 6.00 Total revenue 837.90 Expenses Direct operational expenses 320.10 Employee benefits expense 49.00 Finance costs 1.10 Depreciation expense 87.50 Other expenses 507.80 Total expenses 965.50

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Particulars Period 2012 (`̀ in lakhs)

Loss before tax (127.60) Tax expenses (1) Current tax 17.50 (2) Deferred tax charge 0.10 Loss for the period (145.20) OTHER MATTERS 1. Contingent liabilities 98.00* 2. Capital commitments Nil *amount is not quantifiable in case of joint venture Movement of the aggregate shareholders funds of the joint ventures: Shareholder’s funds as at beginning of the period 423.90 Add: Share of loss for the period (145.20) Effect of disposal of joint ventures (299.00) Shareholder’s funds as at the end of the period (20.30)

Note: Swanston Multiplex Cinemas Private Limited, a Joint Venture of the Company operated a multiplex cinema. The lease of the multiplex cinema has been terminated by the landlord. Considering the termination of the lease, the Group has decided to write down the value of its tangible assets and goodwill amounting to ` 534.20 lakhs.

4. Foreign currency exposures (other than investments and fixed assets) not covered by forward contracts

Currency Period 2012 Amount – foreign

currency (lakhs) Amount – (`̀ in lakhs)

Trade and other receivables USD 71.20 3,708.10 GBP 18.90 1,573.90 EURO 0.40 27.80 NPR 437.90 283.20 MYR 33.90 576.70 MUR 174.30 326.10 Trade and other payables USD 61.20 3,187.30 GBP 5.30 441.40 EURO 0.90 62.50 MYR 81.80 1,391.50 NPR 71.60 46.30 MUR 0.50 0.90 Loans / Buyers credit USD 173.30 9,025.30 MYR 53.20 905.00 Cash and bank balances USD 4.10 213.50

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Currency Period 2012 Amount – foreign

currency (lakhs) Amount – (`̀ in lakhs)

MYR 8.70 148.00 NPR 221.70 143.40 GBP 3.20 266.50 MUR 1.10 02.10

5. Movement of Goodwill

Particulars Period 2012 (`̀ in lakhs)

Opening balance of Goodwill 8,819.42 Impact for Subsidiaries sold during the period (135.60) Impact of exchange differences 13.30 Impact of impairment for a Joint venture (492.60) 8,204.52

6. Considering the continuing substantial losses incurred by the Group / Parent Company, its net worth has been

substantially reduced. However, having regard to improved operational performance on account of stabilisation of new businesses in films and media services, financial support from its promoters, further restructuring exercise being implemented etc, the financial statements of the Company have been prepared on the basis of going concern and no adjustments are required to the carrying value of assets and liabilities.

7. During the period, the Group has amicably settled two of its major disputes with landlords in connection with Conducting Agreements signed for acquisition of Exhibition properties. As against the claims of ` 7,030 lakhs, Company has vacated properties on as it where basis for a total consideration of ` 450 lakhs. The carrying cost of capital work in progress net of aforesaid consideration aggregating to ` 2,150 lakhs has been charged off to the Statement of profit and loss.

8. The Company has entered into a memorandum of understanding granting an option to the third party to purchase assets of the Company having a net block of ` 18,617.00 lakhs as at 31 March 2012 at a price mutually decided. The option to purchase can be exercised at any time till the expiry of the option contract.

9. For Period 2012, subsidiaries in USA and Nepal have been considered as non-integral and subsidiaries in UK, Malaysia, Mauritius and Netherlands have been considered as integral to the operations of the Parent Company in India.

10. Post period end, the Company executed an indicative non-binding term sheet with a private equity fund to acquire a substantial minority stake through an investment of ` 60,500 lakhs in our Company’s film and media services division. The investment is proposed to be made into the subsidiary of our Company, into which our film and media services division will be transferred. No definitive agreement has been executed in respect of the proposed transaction.

II. Period 2011

1. Lease disclosure under AS 19 - ‘Leases’

The Group is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the terms of the respective agreements. The future minimum lease payments in respect of non-cancellable operating leases are as follows:

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Particulars Period 2011

(`̀ in lakhs) For the Parent Company / Subsidiary Companies Amounts due within one year from the balance sheet date 14,312.10 Amounts due in the period between one year and five years 61,643.10 Amount due after five years 84,795.60 160,750.80 For Joint ventures (Group's share) Amounts due within one year from the balance sheet date 193.00 Amounts due in the period between one year and five years 176.90 369.90

Amount payable within lock-in-period is ` 102,125.80 lakhs.

Amount debited to statement of profit and loss for lease rental is ` 17,114.60 lakhs excluding amount capitalised ` 906.20 lakhs.

2. Mark to Market (MTM) losses on derivative contracts

The Group has assigned the derivative contract pertaining to Interest rate swap for long term loans to a Company (Assignee), who has advised the Group regarding entering into these contracts. The Assignee had advised the Group with regards to entering into these derivative contracts and has indemnified the Company with regards to any mark to market losses that the Group will have to incur on termination of these contracts. Consequently, the total mark to market loss of ` 1,921.40 lakhs has not been recognised by the Group in its statement of profit and loss. For the same reason, the Group has also not recognised a liability for these MTM losses and amounts receivable from the Assignee Company.

3. Interest in Joint ventures

The Company’s interests in jointly controlled entities (incorporated Joint ventures) are:

Name of the Company

Country of Incorporation

% of ownership interest as at 31

March 2011 Swanston Multiplex Cinemas Private Limited India 50% Cineplex Private Limited India 50% Divyashakti Marketing Private Limited India 50%

Details of Joint ventures

Particulars Period 2011 (`̀ in lakhs)

EQUITY AND LIABILITIES Shareholders' funds (a) Share capital 74.00 (b) Reserves and surplus 349.90

Share application money, pending allotment 125.00

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Particulars Period 2011 (`̀ in lakhs)

LIABILITIES Non-current liabilities (a) Long-term borrowings 383.00 (b) Deferred tax liabilities (net) 38.40 (c) Other long-term liabilities 4.30 (d) Long-term provisions 1.00

Current liabilities (a) Trade payables 103.70 (b) Other current liabilities 48.30 (c) Short-term provisions 80.30

Total 1,207.90

ASSETS Non-current assets (a) Fixed assets (i) Tangible assets (including capital work-in-progress) 761.90

(b) Long-term loans and advances 168.00

Current assets (a) Current investments 10.40 (b) Inventories 11.80 (c ) Trade receivables 84.60 (d) Cash and bank balances 33.90 (e) Short-term loans and advances 101.10 (f) Other current assets 36.20

Total 1,207.90

Statement of profit and loss

(a) Revenue from operations 1,093.00

(b) Other income 9.30

Total revenue 1,102.30

Expenses

Direct operational expenses 540.10 Employee benefits expense 54.40 Finance costs (net) 14.30 Depreciation / amortisation expense 112.00 Other expenses 419.60

Total expenses 1,140.40 Loss before tax (38.10) Tax expenses (1) Current tax 30.30 (2) Deferred tax (credit) (1.00) Loss for the period (67.40)

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Particulars Period 2011 (`̀ in lakhs)

OTHER MATTERS 1. Contingent liabilities 116.20* 2. Capital commitments Nil *amount is not quantifiable in case of joint venture Movement of the aggregate reserves of the joint ventures: Reserves as at beginning of the period 491.30 Add: Share of loss for the period (67.40) Reserves as at the end of the period 423.90

4. Foreign currency exposures (other than investments and fixed assets) not covered by forward contracts

Particulars Currency Period 2011 Amount – foreign currency (lakhs)

Amount (` in lakhs)

Trade and other receivables USD 57.00 2,587.80 GBP 9.50 691.60 EURO 0.70 44.80 NPR 375.80 242.60 MYR 34.60 519.70 SGD 0.40 14.40 MUR 174.30 288.80 Trade and other payables USD 56.50 2,564.90 GBP 7.60 553.20 EURO 0.40 25.60 MYR 99.30 1,491.30 NPR 72.30 46.70 MUR 1.10 1.80 Loans / Buyers credit USD 147.70 6,705.10 MYR 53.20 799.00 Cash and bank balances USD 13.40 608.30 MYR 22.00 330.40 NPR 157.20 101.50 GBP 4.10 298.40 EURO 0.30 19.20 MUR 0.40 0.70

5. Foreign Currency Convertible Bonds (‘FCCB’)

On 25 January 2006 the Company (‘Issuer’) issued 84,000 Zero Coupon Foreign Currency Convertible Bonds of face value of Euro 1,000 each (‘Bonds’ or ‘FCCB’) aggregating Euro 840 lakhs which were convertible at any time on or after 7 March 2006 and up to the close of the business on 19 January 2011 by the holders of the Bonds (‘the Bondholders’) into newly issued equity shares of the Company with full voting rights with par

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value of ` 5 each (‘Shares’) at an initial conversion price (as defined in Terms and Conditions of the Bonds) of ` 543.42 per share with a fixed rate of exchange on conversion of ` 54.26=EUR 1.00. The Bonds were listed on the Singapore Exchange Securities Trading Limited (‘SGX ST’). Of the above, bondholders holding bonds of value Euro 633.50 lakhs opted for conversion in period ended 31 March 2008. During the year ended 31 March 2009, the Company demerged its radio division to Reliance Broadcast Network Limited. As per the terms of FCCB’s issued, the conversion price of the bonds is subject to adjustment and the Company was awaiting a confirmation from the bondholders till the date of redemption. Unless previously redeemed, converted or purchased and cancelled, the bonds will mature on 26 January 2011 at 121.679 per cent of the principal amount.

During the financial period ended 31 March 2008, the Company classified the liability towards FCCB’s as non–monetary liability inter-alia on the basis of the trend of earnings, movement of the Company's share prices and conversion option exercised by the FCCB holders. On 25 January 2011, the entire FCCB’S outstanding as at 31 March 2010, aggregating to Euro 206.50 lakhs have been redeemed at ` 15,814.20 lakhs (including premium ` 3,085.40 lakhs). Consequently on redemption, foreign exchange loss aggregating to ` 1,489.60 lakhs has been accounted.

6. Movement of goodwill

Particulars Period 2011

(`̀ in lakhs) Opening balance of goodwill 8,728.62 Goodwill for Subsidiaries acquired in the current year - Goodwill for additional shares in Subsidiaries acquired in the current year (net) 90.80 8,819.42

7. The Parent Company's stake in share capital of Sultan Production Private Limited ('Sultan') is in excess of 20%. This investment was made by the Parent Company with the intention of investment in the movie "Sultan: The warrior". However, during Period 2009, the Company has issued a letter of termination demanded refund for the moneys paid by the Company and filed a recovery suit against Orcher Studios, as per a shareholders’ agreement signed by the Company which has been agreed to by Orcher Studios. Since, the Company has intention of selling the shares; the Company has decided not to consider Sultan as an associate under AS-18 Related Party Disclosures and AS-23 'Accounting for Associates in Consolidated Financial Statements. The outstanding balance of Sultan Production Private Limited was ` 1,158.80 lakhs as at 31 March 2010, of which the Company has considered ` 120.00 lakhs as doubtful in Period 2010 and provided for the same. During Period 2011 Company have received all the money receivable as per the shareholders agreement and sold the shares

8. During Period 2011, the Company has sold assets of ` 10,417.30 lakhs for `13,997.20 lakhs pertaining to the theatrical exhibition segment and leased them back subsequently. The profit on sale of these assets has been disclosed under the Annexure of other income.

9. For Period 2011, subsidiaries in USA and Nepal have been considered as non-integral and subsidiaries in UK, Malaysia, Mauritius and Netherlands have been considered as integral to the operations of the Parent Company in India.

10. Interest and finance (net) charge includes loss on derivative contract (net) ` 2,166.90 lakhs.

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III. Period 2010 1. Lease disclosure under AS 19 – ‘Leases’

The Group is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the term of the respective agreements.

The future minimum lease payments in respect of non-cancellable operating lease are as follows:

Particulars Period 2010 (`̀ in lakhs)

For the Parent Company Amounts due within one year from the balance sheet date 8,089.60 Amounts due in the period between one year and five years 33,154.40 Amount due after five years 71,712.40 112,956.40 For Subsidiaries Amounts due within one year from the balance sheet date 2,453.90 Amounts due in the period between one year and five years 7,167.50 Amounts due after five years 10,170.30 19,791.70 For Joint ventures (Group's share) Amounts due within one year from the balance sheet date 193.00 Amounts due in the period between one year and five years 369.90 569.90

Amount payable within lock-in-period is ` 74,381.30 lakhs.

Amount debited to profit and loss account for lease rental is ` 12,366.10 lakhs excluding amounts capitalised ` 1,344.20 lakhs.

2. Mark to Market (MTM) losses on derivative contracts

The Group has assigned the derivative contracts pertaining to Options for FCCB and interest rate swap for long term loans to a Company (Assignee), who has advised the Group regarding entering into these contracts. The Assignee had advised the Group with regards to entering into these derivative contracts and has indemnified the Group with regards to any mark to market losses that the Group will have to incur on termination of these contracts. Consequently, the total mark to market loss of ` 2,750.40 lakhs has not been recognised by the Group in its profit and loss account. For the same reason, the Group has also not recognised a liability for these MTM losses and amounts receivable from the Assignee Company.

3. Interest in Joint ventures The Company’s interests in jointly controlled entities (incorporated Joint ventures) are:

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Name of the Company

Country of Incorporation

% of ownership interest as at 31

March 2010

Swanston Multiplex Cinemas Private Limited India 50%

Cineplex Private Limited India 50%

Divyashakti Marketing Private Limited India 50%

Details of Joint ventures

Particulars Period 2010 (` in lakhs)

I Assets

1. Fixed assets net block (including Capital work-in-progress) 871.00

2. Investments -

3. Current assets, loans and advances

a) Inventories 11.40

b) Sundry debtors 70.50

c) Cash and bank balances 77.80

d) Interest accrued but not due 1.00

e) Loans and advances 277.80

II Liabilities

1. Shareholders' fund 491.30

2. Advance towards share application money 125.00

3. Unsecured loans 456.80

4. Deferred tax liability (net) 39.50

5. Current liabilities and provisions

a) Liabilities 153.90

b) Provisions 43.00

III Income

1. Income from theatrical exhibition (net of duties and taxes) 1,027.30

2. Other income 36.00

IV Expenses

1. Direct operational expenses 539.70

2. Personnel costs 53.60

3. Other operating and general administrative expenses 348.60

4. Depreciation 111.80

5. Interest 44.40

Loss before tax (34.80)

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Particulars Period 2010 (` in lakhs)

Provision for tax (including deferred tax) (47.50)

Profit after tax 12.70

V. Other matters

1. Contingent liabilities 948.20 2. Capital commitments Nil

Movement of the aggregate shareholders funds of the joint ventures: At the beginning of the period 478.60 Add: Share of profits for the period 12.70

At the end of the period 491.30

4. Foreign currency exposures (other than investments and fixed assets) not covered by forward contracts

Particulars Currency Period 2010 Amount – foreign currency (lakhs)

Amount (` in lakhs)

Sundry debtors USD 29.00 1,305.90 GBP 1.60 108.60 EURO 0.40 24.20 NPR 0.20 0.10 Sundry creditors USD 59.60 2,683.80 GBP 16.70 1,133.40 EURO 1.60 96.90 MYR 107.60 1,484.30 NPR 113.60 72.20 MUR 1.20 1.80 Loans and advances USD 14.20 639.40 GBP 6.20 420.80 EURO 0.10 6.10 MYR 31.40 433.20 NPR 296.60 188.40 MUR 174.30 265.00 Loans taken USD 101.90 4,588.60 MYR 53.20 733.90 NPR 443.30 281.60 Advance from customer USD 3.30 148.60 GBP 0.50 33.90 Cash and bank balances USD 54.70 2,463.10 MYR 28.00 386.20 NPR 1.50 1.00 GBP 1.10 74.70 EURO 0.10 6.10 MUR

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Particulars Currency Period 2010 Amount – foreign currency (lakhs)

Amount (` in lakhs)

Buyers credit USD 46.10 2,075.90 GBP 1.20 78.00 EURO 8.20 496.70 Foreign currency convertible bonds (FCCB) (refer note (c) of B of Annexure IV)

EURO 206.50 12,511.90

Provision for premium on redemption on FCCB

EURO 44.80 2,712.40

5. Foreign Currency Convertible Bonds (‘FCCB’) On 25 January 2006 the Company (‘Issuer’) issued 84,000 Zero Coupon Foreign Currency Convertible Bonds of face value of Euro 1,000 each (‘Bonds’ or ‘FCCB’) aggregating Euro 840 lakhs. The Bonds are convertible at any time on or after 7 March 2006 and up to the close of the business on 19 January 2011 by the holders of the Bonds (‘the Bondholders’) into newly issued equity shares of the Company with full voting rights with par value of ` 5 each (‘Shares’) at an initial conversion price (as defined in Terms and Conditions of the Bonds) of ` 543.42 per share with a fixed rate of exchange on conversion of ` 54.26=EUR 1.00. Of the above bondholders holding bonds of value Euro 633.50 lakhs opted for conversion in Period 2008. The balance bond values aggregating to EURO 206.50 lakhs are outstanding as on the balance sheet date. During Period 2009, the Company demerged its radio division to Reliance Broadcast Network Limited (refer note 1 of IV of E of Annexure IV). As per the terms of bond issue, the conversion price of the bonds is subject to adjustment, after agreement with the bondholders. Pending finalisation of agreement, the revised conversion price is not yet decided. Consequently the equity shares issuable on conversion of FCCB 2,061,884 have been computed based on initial conversion price. The Bonds are listed on the Singapore Exchange Securities Trading Limited (‘SGX ST’). The Bonds may be redeemed, in whole but not in part, at the option of the issuer at any time on or after 25 January 2009 and on or prior to 26 January 2011 subject to satisfaction of certain conditions. Unless previously redeemed, converted or purchased and cancelled, the bonds will mature on 26 January 2011 at 121.679 per cent of the principal amount. The balance in premium account as at 31 March 2010 is as follows:

Period 2010 (`̀ in lakhs)

Opening balance 3,084.79

Adj: foreign exchange fluctuation (372.50)

Closing balance 2,712.29 During Period 2008, the Company classified the liability towards FCCB as non–monetary liability inter-alia on the basis of the trend of earnings, movement of the Company's share prices and conversion option exercised by the FCCB holders. The Company continues to classify the liability towards FCCB as a non–monetary liability as in its view the current fall in the market price of the Company’s share price and non-conversion by bond holders is a temporary aberration. Further, pursuant to scheme of demerger of the radio division, the conversion price is subject to adjustment, after agreement with bond holders. The

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Company estimates that there will be significant adjustments to conversion price considering the value of Radio division which has demerged. Consequently, the foreign exchange fluctuation (gain) / loss for the year ended 31 March 2010 aggregating to ` (1,718.10) lakhs has not been recognised by management. Cumulative loss not recognised due to classification of FCCB as a non-monetary liability is ` 1,272.20 lakhs in respect of outstanding FCCB's. Unrecognised losses on FCCB's which were converted into equity shares in earlier periods is ` 2,199.50 lakhs.

(Refer note (c) of B of Annexure IV)

6. The Parent Company's stake in share capital of Sultan Production Private Limited ('Sultan') is in excess of 20%. This investment was made by the Company with the intention of investment in the movie "Sultan: The warrior". However, during Period 2010, the Company has issued a letter of termination demanded refund for the moneys paid by the Parent Company and filed a recovery suit against Orcher Studios, as per a shareholders agreement signed by the Company which has been agreed to by Orcher Studios. Since, the Parent Company has intention of selling the shares, the Company has decided not to consider Sultan as an associate under AS-18 Related Party Disclosures and AS-23 'Accounting for Associates in Consolidated Financials Statements.

The outstanding balance of Sultan Production Private Limited is ` 1,158.80 lakhs of which the Company has considered ` 120.00 lakhs as doubtful in Period 2010 and provided for the same.

7. Movement of goodwill

Particulars Period 2010 (`̀ in lakhs)

Opening balance of goodwill 4,202.56 Goodwill for Subsidiaries acquired in the current period 1,944.36 Goodwill for additional shares in Subsidiaries acquired in the current period (net) 2,581.70 Total 8,728.62

8. For Period 2010, subsidiaries in USA and Nepal have been considered as non-integral and subsidiaries in

UK, Malaysia, Mauritius and Netherlands have been considered as integral to the operations of the Parent Company in India.

9. Interest and finance charges (net) include loss on derivative transactions (net) of ` 3,539.20 lakhs.

IV. Period 2009 1. Demerger of the Radio Business of the Company to Reliance Broadcast Network Limited The Board of the Company in their meeting held on 25 October 2008 approved a Scheme of Arrangement (‘the Radio Scheme’) between Reliance Broadcast Network Limited (‘RBNL’), a wholly owned subsidiary and the Company for the de-merger of the Radio business of the Company into RBNL. The shareholders of the Company accorded their approval in a court convened meeting of members of the Company held on 22 January 2009. The Radio Scheme was approved by the Hon’ble High Court of Judicature at Bombay vide its order dated 4 April 2009 and filed with the Registrar of Companies (‘ROC’) on 30 June 2009, as required under Section 391(3) of the Act after obtaining approval from the Ministry of Information and Broadcasting (‘MIB’) for vesting of radio licenses held by the Company in the name of RBNL. As per the Radio Scheme, the Radio business of the Company stands transferred to RBNL with effect from 1 April 2008, the Appointed Date and has been given effect to on 30 June 2009, being the Effective Date and the accounting treatment prescribed by the Radio Scheme has been given effect to in the financial statements for the year ended 31 March 2009.

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All the assets of and liabilities, directly allocable and as mutually determined by the Board of Directors of RBNL and the Company, of the Radio business as at 1 April 2008 have been transferred at their respective book values. Further, general borrowings of the Company as on 1 April 2008 have been allocated between the Company and RBNL on the basis of ratio of total assets of the Company immediately before giving effect of the Radio Scheme. In consideration of the demerger, RBNL will allot equity shares of ` 5 each in the ratio of 1:1 and upon issue of shares as above the Company’s investment in shares of RBNL will stand cancelled. As per the provisions of the Radio Scheme, excess balances of assets transferred over liabilities and the cost of Investments in RBNL cancelled has been debited to Securities premium account as follows:

Amount

(`̀ in lakhs) Assets of Radio Business as of 1 April 2008 transferred as per the provisions of the Radio Scheme 44,929.50 Liabilities of Radio Business as of 1 April 2008 transferred as per the provisions of the Radio Scheme (6,831.50) General borrowings of the Company as of 1 April 2008 allocated between RBNL (Radio Business) and the Company as per the provisions of the Radio Scheme (22,400.00) Excess of net assets transferred to RBNL (Radio Business) 15,698.00 Cancellation of investment in RBNL 1,010.00 Total amount debited to Securities premium account as per the Provisions of the Radio Scheme 16,708.00

The radio business has been held / carried on in trust for the period 1 April 2008 till the Effective Date by the Company. Accordingly, the Company has charged interest, at an agreed rate on the amount receivable as at the appointed date and subsequent funding till the effective date. The total receivable ` 26,095.00 lakhs (includes interest ` 2,584.90 lakhs) has been disclosed as a recoverable from RBNL.

However, for Period 2009 financial statements, pending allotment of shares by RBNL, the investment has been cancelled to give effect to the substance of the Radio Scheme as approved by the Hon’ble High Court of Judicature at Bombay and RBNL ceases to be a subsidiary for Period 2009 financial statements.

2. Scheme for merger of wholly owned subsidiaries with the Company

The Board of the Company in their meeting held on 30 January 2009 approved the Scheme of Amalgamation (‘Amalgamation Scheme’) of the Company (‘Transferee’) with its wholly owned subsidiaries Adlabs Multiplexes and Theatres Limited (‘AMTL’), Adlabs Multiplex Limited (‘AML’), Mahimna Entertainment Private Limited (‘MEPL’) and Rave Entertainment Private Limited (‘REPL’) (collectively referred to as the Transferor Companies). The Amalgamation Scheme was approved by the Hon’ble High Court of Judicature at Bombay vide its order dated 8 May 2009 and filed with the Registrar of Companies (‘ROC’) on 29 May 2009, as required under Section 391(3) of the Act.

AMTL, AML and REPL are engaged in the exhibition business and has been included in the exhibition segment. MEPL has been included in the unallocated corporate segment.

As per the Amalgamation Scheme, AMTL, AML, MEPL and REPL amalgamated with the Company with effect from 1 April 2008, the Appointed Date and has been given effect to on 29 May 2009, being the Effective Date and the accounting treatment prescribed by the Amalgamation Scheme has been given effect to in the financial statements for the Period 2009.

In accordance with the requirements of the Amalgamation Scheme, the credit aggregating ` 5,826.20 lakhs to Capital reserve has been arrived at as follows:

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All assets and liabilities of the transferor companies as at 1 April 2008 which have been identified by the Board of Directors have been recorded at their respective fair values (as determined based on valuation reports from government approved valuer / management estimates) as on 31 March 2009. Investments in the equity shares of the transferor companies as appearing in the books of the Transferee Company as at 31 March 2009 have been cancelled. The excess of net assets of the transferor companies taken over at fair value (as determined on 31 March 2009) over the cost of investment in these companies, aggregating ` 3,605.80 lakhs has been credited to Capital reserve.

The Company has recorded an increase in the value of its assets based on revaluation of certain assets of the Company pertaining to the Exhibition and Film Services business. The total increase in value of assets of the Company is ` 17,890.10 lakhs, based on revaluation reports obtained from government approved external valuers. The Company has also reduced the value of its assets by ` 15,669.70 lakhs (Fixed assets and intangible rights ` 3,989.50 lakhs, Debtors ` 2,050.70 lakhs, Loans and advances including capital advances ` 6,188.50 lakhs and Investments ` 3,441.00 lakhs). The net increase in the value of assets of the Company ` 2,220.40 lakhs has been credited to Capital reserve pursuant to the provisions of the Scheme.

The authorised share capital of the transferor Companies was considered as authorised share capital of the transferee Company. Hence, the authorised share capital of the Company has been increased by ` 1,602.90 lakhs divided into 32,058,000 shares of ` 5 each.

The above mentioned accounting treatment is in accordance with the Amalgamation Scheme, had the Company followed accounting treatment prescribed by AS – 14 “Accounting for Amalgamations” / Indian GAAP:

The excess of investments over net assets acquired for the Company amounting to ` 1,939.10 lakhs would

have been transferred to Goodwill and would have been amortised over 5 years. The appreciation in the value of the Company’s assets aggregating ` 17,890.10 lakhs would have been

credited to the Revaluation reserve instead of being credited to the capital reserve. The diminution in the value of the Company’s assets aggregating ` 15,669.70 lakhs would have been

debited to the profit and loss account instead of capital reserve. Accordingly, had the Amalgamation Schemes as referred above been accounted for as per the requirements of AS – 14 “Accounting for Amalgamations” / Indian GAAP, the loss for the year would be higher by ` 16,057.60 lakhs, capital reserve would have been lower ` 281.20 lakhs, revaluation reserve would have been higher by ` 17,890.10 lakhs and balance of Goodwill would have been ` 1,551.30 lakhs.

3. Lease disclosure under AS 19 - ‘Leases’ The Group is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the terms of the respective agreements. The future minimum lease payments in respect of non-cancellable operating leases are as follows:

Particulars Period 2009 (`̀ in lakhs)

For the Parent Company Amounts due within one year from the balance sheet date 6,724.30 Amounts due in the period between one year and five years 27,988.70 Amounts due after five years 71,374.40 Total 106,087.40 For Subsidiaries Amounts due within one year from the balance sheet date 3,319.50 Amounts due in the period between one year and five years 8,465.20

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Particulars Period 2009 (`̀ in lakhs)

Amounts due after five years 7,942.50 Total 19,727.20 For Joint venture (Group’s share) Amounts due within one year from the balance sheet date 2,046.70 Total 2,046.70

Amount payable within lock-in-period is ` 39,398.00 lakhs. Amount debited to profit and loss account for lease rental is ` 9,672.10 lakhs excluding amount capitalised ` 1,244.10 lakhs. 4. Mark to Market (MTM) losses on derivative contracts

The Company has assigned the derivative contracts pertaining to Options for FCCB and Interest rate swap for long term loans to a Company(‘Assignee’), who has advised the Company regarding entering into these contracts. The Assignee had advised the Company with regards to entering into these derivative contracts and has indemnified the Company with regards to any mark to market losses that the Company will have to incur on termination of these contracts. Consequently, the total mark to market loss of `14,037.00 lakhs have not been recognised by the Company in its profit and loss account.

For the same reason, the Company has also not recognised a liability for these MTM losses and amounts receivable from the Assignee Company. 5. Interest in joint ventures The Company’s interests in jointly controlled entities (incorporated Joint ventures) are:

Name of the Company Country of Incorporation

% of ownership interest as at 31

March 2009

Swanston Multiplex Cinemas Private Limited India 50% Cineplex Private Limited India 50% Divyashakti Marketing Private Limited India 50%

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Details of Joint ventures

Period 2009 (`̀ in lakhs)

I Assets 1. Fixed assets (including Capital work-in-progress) 964.20 2. Current assets, loans and advances a) Inventories 11.20 b) Sundry debtors 53.70 c) Cash and bank balances 82.00 d) Interest accrued but not due 0.60 e) Loans and advances 115.00 II Liabilities 1. Shareholders' fund 478.60 2. Unsecured loans 506.80 3. Deferred tax liability (net) 55.70 4. Current liabilities and provisions a) Liabilities 159.30 b) Provisions 26.30 III Income 1. Sales (net of duties and taxes) 1,186.70 2. Other income 92.00 IV Expenses 1. Operating expenses 956.80 2. Depreciation 109.70 3. Interest - Profit before tax 212.20 Provision for tax (including deferred tax) 51.50 Profit after tax 160.70 V. Other matters 1. Contingent liabilities 1,016.10 2. Capital commitments Nil Movement of the aggregate shareholders’ funds of the joint ventures: At the beginning of the period 404.90 Add: Share of profits for the period 160.70 Less: Dividend declared during the period (87.00) At the end of the period 478.60

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6. Foreign currency exposures (other than investments and fixed assets) not covered by forward

contracts

Particulars

Currency Period 2009

Foreign Currency Amount (lakhs)

Amount (`̀ in lakhs)

Sundry debtors USD 34.60 1,805.20 GBP 0.50 37.10 EURO 0.20 13.80 Sundry creditors USD 45.00 2,347.80 GBP 2.30 170.60 EURO 0.10 6.90 MUR 133.60 216.80 MYR 0.60 8.60 NPR 2.80 1.80 Loans and advances USD 37.80 1,972.20 GBP 0.50 37.10 EURO 0.60 41.30 MYR 19.70 282.00 NPR 41.30 26.60 MUR 282.80 458.90 Cash and bank balances USD 16.70 871.30 MYR 68.70 983.30 NPR 54.70 35.30 GBP 1.10 81.60 EURO 0.40 27.60 Buyers credit USD 5.30 276.60 GBP 1.20 85.30 EURO 8.20 564.90 Unsecured loans USD 156.40 8160.10 Foreign Currency Convertible bonds ( )

EURO 206.50 14,230.00 Provision for premium on redemption of EURO 44.80 3,084.80

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7. Foreign Currency Convertible Bonds (‘FCCB’) On 25 January 2006 the Company (‘Issuer’) issued Zero Coupon Foreign Currency Convertible Bonds (‘Bonds’ or ‘FCCB’) aggregating Euro 840 lakhs. The Bonds are convertible at any time on or after 7 March 2006 and up to the close of the business on 19 January 2011 by the holders of the Bonds (‘the Bondholders’) into newly issued equity shares of the Company with full voting rights with par value of ` 5 each (‘Shares’) at an initial conversion price (as defined in Terms and Conditions of the Bonds) of ` 543.42 per share with a fixed rate of exchange on conversion of ` 54.26=EUR 1.00. Of the above bondholders holding bonds of value Euro 633.50 lakhs opted for conversion in the period 2008. The balance bondholders holding bonds value aggregating to Euro 206.50 lakhs have not opted for conversion and outstanding as on the balance sheet date. The conversion price is subject to adjustment in certain circumstances, such as demerger of divisions, based on the agreement with bondholders and the Company. Pending finalisation of agreement, the revised conversion price is not yet decided. Consequently the equity shares issuable on conversion of FCCB have been computed based on initial conversion price. The Bonds are listed on the Singapore Exchange Securities Trading Limited (‘SGX-ST’). The Bonds may be redeemed, in whole but not in part, at the option of the issuer at any time on or after 25 January 2009 and on or prior to 26 January 2011 subject to satisfaction of certain conditions. Unless previously redeemed, converted or purchased and cancelled, the bonds will mature on 26 January 2011 at 121.679 per cent of the principal amount. The balance in premium account as at 31 March 2009 is as follows:

Particulars Period 2009 (`̀ in lakhs)

Opening balance 2,839.89 Add: foreign exchange fluctuation 244.90 Closing balance 3,084.79

During Period 2008, the Company re-classified the liability towards Foreign Currency Convertible Bonds ('FCCB') as non–monetary liability inter-alia on the basis of the trend of earnings, movement of the Company's share prices and conversion option exercised by the FCCB holders. The Company continues to classify the liability towards FCCB as a non–monetary liability as in its view the current fall in the market price of the Company’s share price and non-conversion by bond holders is a temporary aberration. Consequently, the foreign exchange fluctuation loss for the Period 2009 aggregating to ` 1,130.10 lakhs has not been recognised by the management. Cumulative loss not recognised due to classification of FCCB as a non-monetary liability is ` 2,990.40 lakhs in respect of outstanding FCCB's. Unrecognised losses on FCCB's which were converted into equity shares in earlier periods is ` 2,199.50 lakhs. (Refer note (c) of B of Annexure IV) 8. Impairment Disclosure

During Period 2009, the Company has impaired certain fixed assets pertaining to the:- Exhibition Division on the basis of determination of value in use of each property, which the Company considers as the relevant Cash Generating Unit (‘CGU’) for the purpose of impairment testing. The Company has considered a discount rate of 11.68%. The amount of impairment loss of ` 551.70 lakhs has been debited to the Capital reserve pursuant to Scheme of Amalgamation.

(Refer note 2 of IV of E of Annexure IV)

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9. Movement of Goodwill

Particulars Period 2009 (`̀ in lakhs)

Opening balance of goodwill 2,746.76 Goodwill, reversed on Subsidiaries which have been amalgamated in the Period 2009 (1,605.50)

Goodwill for Malaysia Subsidiary acquired in the Period 2009 3,060.70 Goodwill for additional shares in Subsidiaries acquired in the Period 2009 0.60 Total 4,202.56

10. For Period 2009, subsidiaries in USA have been considered as non-integral and subsidiaries in UK,

Malaysia, Mauritius, Nepal and Netherlands have been considered as integral to the operations of the Parent Company in India.

11. Interest and finance (net) charge includes loss on derivative contract (net) ` 4,864.90 lakhs.

V. Period 2008

1. Modified Composite Scheme of amalgamation and arrangement The Board of the Company at their meeting held 23 April 2006 approved the Composite Scheme of amalgamation and arrangement between the Company, Entertainment One India Limited (‘E-ONE’), Adlabs Multiplex and Theatres Limited (‘AMTL’) and Reliance Broadcast Network Limited (‘RBNL’). The shareholders of the Company accorded their approval to the Composite Scheme at the Annual General Meeting on 29 July 2006. The Composite Scheme was approved by the Hon'ble High Court of Judicature at Bombay vide its order dated 15 September 2006. The Composite Scheme inter-alia provided for the following:

the amalgamation of E-ONE with the Company effective 1 April 2005; the merger of the digital business of AMTL with the Company effective 1 April 2005; and the demerger of the radio business of the Company to RBNL effective 31 March 2006.

The Company had made an application to the Ministry of Information and Broadcasting for vesting of radio licenses held by it in the name of RBNL. Pending the said approval, the Composite Scheme was not filed with the Registrar of Companies ('ROC') as required under Section 391(3) of the Companies Act, 1956 ('the Act'). However, for the purpose of the Period 2007 financial statements, pending completion of licensing and other procedural formalities, the Composite Scheme was given effect to in view of the Court approval and to give effect to the substance of the Composite Scheme as approved by the Hon'ble High Court of Judicature at Bombay In accordance with the requirements of the Composite Scheme, the merger of E-ONE as well as the digital business of AMTL and the demerger of the radio business of the Company was accounted for as follows:

All assets and liabilities of E-ONE as at 1 April 2005 were recorded by the Company at their fair values. Since E-ONE was a wholly owned subsidiary of the Company, the investment by the Company in the shares of E-ONE was cancelled against the assets and liabilities acquired on amalgamation. The excess of net assets taken (at fair value) over the cost of investment in EONE amounting to ` 272.58 lakhs was credited to 'Amounts pending transfer to the Securities premium

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account and / or General reserve account as per the Composite Scheme of amalgamation and arrangement'.

All assets and liabilities of the digital business of AMTL as at 1 April 2005 were recorded by the Company at their book values. Since AMTL was a wholly owned subsidiary of the Company, no consideration was paid against the assets and liabilities acquired. The excess of liabilities over the assets taken over (at book value) amounting to ` 44.69 lakhs was debited to 'Amounts pending transfer to the Securities premium account and / or General reserve account as per the Composite Scheme of amalgamation and arrangement'.

All assets and liabilities of the radio business of the Company as at 31 March 2006 were transferred at their respective book values. The aggregate value of net assets transferred pursuant to the Composite Scheme in excess of ` 10,000.00 lakhs (which was recorded as receivable from RBNL) was recorded in 'Amounts pending transfer to the Securities premium account and/or General reserve account as per the Composite Scheme of amalgamation and arrangement'

Subsequently during the current period, the Board modified the aforesaid Composite Scheme vide circular mode pursuant to Section 289 of the Companies Act, 1956 on 13 February 2008. The Modified Composite Scheme of amalgamation and arrangement (the Modified Scheme) between the Company, E-ONE and AMTL was approved by the Hon'ble High Court of Judicature at Bombay vide its order dated 7 March 2008 and was filed with the ROC as required under Section 391(3) of the Companies Act, 1956 ('the Act') on 31 March 2008.The Modified Scheme inter-alia provides for the following:

the amalgamation of E-ONE with the Company effective 1 April 2005; the merger of the digital business of AMTL with the Company effective 1 April 2005; and adjusting the net results of the transactions related to radio business from 31 March 2006 till the

effective date in the General reserve account of the Company. As the Composite Scheme was primarily modified in relation to the radio business, in respect of amalgamation

of E-ONE and merger of digital business of AMTL, these were already given effect to in the financial statements of the Period 2007. Accordingly, no further adjustments are made in the current period's financial statements, except that the amounts which were not credited / debited to 'Securities premium' / 'General reserve' pending filing the Composite Scheme with ROC have now been debited / credited to Securities premium / General reserve as applicable on the filing of the Modified Scheme with the ROC.

During the Period upto 31 March 2008, E-ONE and AMTL carried on their existing business in trust for and on behalf of the Company. All vouchers, deeds, licenses, agreements, loan documents, etc are in the name of E-ONE and AMTL. The tile deeds, licenses, agreements, loan documents, etc are being transferred in the name of the Company.

As regards the Radio business, the provision relating to demerger of the radio business of the Company to RBNL effective 31 March 2006 as provided in the Composite Scheme and given effect to in the Period 2007 financial statements has been deleted in the Modified Scheme. Accordingly, all the adjustments effected in the Period 2007 financial statements in this regard have been reversed during the current period. Further, in accordance with the Modified Scheme, the net results of the transactions related to radio business for the period from 31 March 2006 till the effective date i.e. 31 March 2008 have been debited to General reserve account of the Company.

The net results of the transactions related to radio business for the period from 31 March 2006 up to 31 March 2008 are summarised hereunder:

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Particulars Period 2008 (`̀ in lakhs)

Period 2007 (` in lakhs)

Income 11,160.90 3,320.30 Expenditure Direct costs 5,062.10 2,024.60 Personnel costs 3,477.60 2,528.10 Other operating and general administrative expenses * 5,584.10 4,547.60 Interest 1,346.30 2,119.90 Depreciation / amortisation 2,396.60 1,474.80 Loss before taxation (6,705.80) (9,374.70) Tax Expenses - fringe benefit tax 114.90 75.50 Loss after tax (A) (6,820.70) (B) (9,450.20) Total (A + B) (16,270.90) Tax effect of the above 1,907.60 Balance transferred to General reserve account 14,363.30

* includes ` 785.80 lakhs (Period 2007: ` 2,086.70 lakhs, since reversed) being interest etc. allocated / charged in the Period 2007 by Company to the Radio Business on net funds utilised in carrying on the radio business. For deviation to the accounting treatment recommended in the standard refer note For deviation to the accounting treatment recommended in the standard refer note 3 of V of E of Annexure IV.

2. Acquisition of Rave Entertainment Private Limited ('REPL') On 31 May 2007, the Company entered into a Share Purchase Agreement ('SPA') with the shareholders of Rave Entertainment Private Limited ('REPL'), a company engaged inter-alia in the business of owning and operating multiplexes, for acquisition of 100% stake in that company. One of the conditions precedent to the SPA was the approval by the Hon'ble High Court of Judicature at Allahabad of the Scheme of demerger filed by REPL for demerger of Kanpur properties. Pending approval of the Scheme of demerger by the said Court, the shares of REPL were held in Escrow and the consideration of ` 500 lakhs was disclosed under loans and advances in the last period's financial statements. On 12 December 2007, the Hon'ble High Court of Judicature at Allahabad approved the said Scheme of demerger. Consequently, REPL is now a wholly owned subsidiary of the Company and the amounts placed in Escrow and those disclosed under loans and advances have been adjusted as per the terms of the SPA. 3. Acquisition of Katch 22 Entertainment Private Limited ('Katch 22') On 23 April 2007, the Company acquired 100% stake in Katch 22, a company engaged in the production and distribution of films. Subsequently, pursuant to the Board of Directors' approval vide resolution dated 26 April 2007, the Company had filed the Scheme of amalgamation of Katch 22 ('the Katch 22 Scheme') with the Hon'ble High Court of Judicature at Bombay for the merger of Katch 22 with the Company effective 1 April 2006. The Katch 22 Scheme was approved by the Hon'ble High Court of Judicature at Bombay vide its order dated 14 September 2007 and filed with the ROC on 9 October 2007. The Katch 22 Scheme inter-alia provides for the amalgamation of Katch 22 Entertainment Private Limited with the Company effective 1 April 2006. In accordance with the requirements of the said Katch 22 Scheme, the merger of Katch 22 with the Company has been accounted for as follows:

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As per the Katch 22 Scheme, Katch 22 amalgamates with the Company retrospectively from 1 April 2006, the Appointed Date. All assets and liabilities of Katch 22 as at 1 April 2006 have been recorded by the Company at their fair values. Since Katch 22 was a wholly owned subsidiary of the Company, the investment by the Company in the shares of Katch 22 has been cancelled against the assets and liabilities acquired on amalgamation. The excess of net assets taken over at fair value (as determined on the effective date i.e. 9 October 2007) over the cost of investment in Katch 22 amounting to ` 201.80 lakhs has been credited to General reserve account.

The Company has also recorded the reduction of ` 2,000 lakhs in the value of its assets (debtors, unamortised rights and loans and advances) by debit to 'General reeserve account' as per the provisions of the Katch 22 Scheme.

The net results of the transactions relating to Katch from 1 April 2006 upto the Effective Date are as follows:

Particulars For the period from 1 July 2007 to 8 October 2007 (`̀ in lakhs)

Period 2007

(` in lakhs)

Sales and Service (net) - 701.90 Other Income 23.30 - Total Revenue 23.30 701.90 Direct costs - 1,691.30 Other operating and general administrative expenses 0.20 0.10 Interest - 131.60 Profit Before taxation 23.10 (1,121.10) Tax expenses - - Profit after tax 23.10 (1,121.10)

Impact of Schemes referred to in notes 1 of V of E of Annexure IV and 3 of V of E of Annexure IV:

Had the Company followed the accounting treatment prescribed by AS-14 / generally accepted accounting principles in India:

` 201.80 lakhs arising from the merger of Katch 22 with the Company and credited to the General reserve account would have been credited to Capital reserve account;

Reduction of ` 2,000.00 lakhs in value of the Company's assets would have been debited to the Profit and loss account instead of General reserve account;

` 2,086.70 lakhs being interest on monies advances by the Company to the Radio Business would have been reversed in the profit and loss account as against the reversal in the General reserve; and

the net results (loss) of the transactions related to Radio Business from 31 March , 2006 upto the Effective date i.e. 31 March 2008 aggregating to ` 14,363.30 lakhs (net of tax benefits) arising from modification in the Scheme of demerger of Radio Business and debited to the General reserve account would have been debited to profit and loss account.

Accordingly, had the Modified Scheme been accounted for in compliance with the requirements of AS 14 / generally accepted accounting principles in India, the profit for the period before tax would have been lower by

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` 18,450.00 lakhs, General reserve account would have been higher by ` 18,248.20 lakhs and Capital reserve account would have been stated at ` 201.80 lakhs.

4. Lease disclosure under AS 19 - ‘Leases’ The Group is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the terms of the respective agreements. The future minimum lease payments in respect of non-cancellable operating leases are as follows:

Particulars Period 2008 (`̀ in lakhs)

For the Parent Company Amounts due within one year from the balance sheet date 4,607.80 Amounts due in the period between one year and five years 18,978.80 Amounts due after five years 53,463.80 Total 77,050.40 For Subsidiaries Amounts due within one year from the balance sheet date 465.40 Amounts due in the period between one year and five years 1,936.40 Total 2,401.80 For Joint venture (Group’s share) Amounts due within one year from the balance sheet date 114.00 Amounts due in the period between one year and five years 104.50 Total 218.50

Amount payable within lock-in-period is ` 38,309.40 lakhs. Amount debited to profit and loss account for lease rental is ` 3,287.20 lakhs. 5. Interests in Joint Venture

The Group's interests in jointly controlled entities (incorporated Joint ventures) are:

Name of the Company Country of incorporation

% of ownership interest as at

31 March 2008 Swanston Multiplex Cinemas Private Limited India 50.00% Adlabs Multiplex Limited (Became wholly owned subsidiary with effect from 20 December 2007)

India -

Cineplex Private Limited India 50.00% Divyashakti Marketing Private Limited India 50.00%

Details of Joint ventures

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Particulars Period 2008

(`̀ in lakhs)

I. Assets

1. Fixed assets (including Capital work-in-progress) 1,063.80

2. Investments 56.40

3. Current assets, loans and advances

a) Inventories 8.50

b) Sundry debtors 88.40

c) Cash and bank balances 69.30

d) Interest accrued but not due 0.50

e) Loans and advances 73.50

II. Liabilities

1. Shareholders' fund 478.90

2 Unsecured loans 634.60

3. Deferred tax liability (net) 54.10

4. Current liabilities and provisions

a) Liabilities 179.60

b) Provisions 13.20

III. Income

1. Sales (net of duties and taxes) 1024.10

2. Other income 102.80

IV. Expenses

1. Operating expenses 911.30

2. Depreciation 102.10

3. Interest 0.60

4. Profit before tax 112.90

5. Prior period adjustments (0.40)

6. Provision for tax (including deferred tax) 30.00

7. Profit after tax 83.30

V. Other matters

1. Contingent liabilities 2,032.20

2. Capital commitments -

Movement of the aggregate shareholders’ funds of the joint ventures:

At the beginning of the period 497.10

Add: Share of loss for the period (18.20)

At the end of the period 478.90

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6. Foreign currency exposures (other than investments and fixed assets) not covered by forward contracts

Particulars Currency

Period 2008

Foreign Currency Amount (lakhs)

Amount

(`̀ in lakhs)

Sundry debtors USD 6.00 239.80

EURO 0.10 6.50

GBP 3.70 290.80

Sundry creditors USD 43.80 1,958.00 EURO 0.30 15.40 GBP 8.30 524.40 MUR 0.70 1.10 Unsecured loans USD 35.80 1,433.80 EURO 13.20 839.30 GBP 0.10 9.00

Zero Coupon Foreign Currency Convertible Bonds (‘FCCB’) (Refer note (c) of B of Annexure IV)

EURO 206.50 13,099.90

Provision for premium on redemption of FCCB

EURO 44.80 2,899.90

7. Foreign Currency Convertible Bonds (‘FCCB’)

On 25 January 2006 the Company ('Issuer') issued Zero Coupon Foreign Currency Convertible Bonds ('Bonds' or 'FCCB') aggregating Euro 840 lakhs. The Bonds are convertible at any time on or after 7 March 2006 and upto the close of the business on 19 January 2011 by the holders of the Bonds ('the Bondholders') into newly issued equity shares of the Company with full voting rights with par value of ` 5 each ('Shares') at an initial conversion price (as defined in Terms and Conditions of the Bonds) of ` 543.42 per share with a fixed rate of exchange on conversion of ` 54.26=EUR 1.00. The conversion price is subject to adjustment in certain circumstances. The Bonds are listed on the Singapore Exchange Securities Trading Limited ('SGX-ST').

The Bonds may be redeemed, in whole but not in part, at the option of the Issuer at any time on or after 25 January 2009 and on or prior to 26 January 2011 subject to satisfaction of certain conditions. Unless previously redeemed, converted or purchased and cancelled, the bonds will mature on 26 January 2011 at 121.679 per cent of the principal amount.

During the Period 2008, bond holders holding bonds aggregating Euro 633.50 lakhs have opted to convert the bonds to equity shares. Accordingly shares aggregating to 6,325,420 have been issued to them at a price of ` 543.42 per share (including securities premium of ` 538.42 per share).

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Period 2008 (`̀ in lakhs)

Opening balance 10,006.59 Add: Reversal of provision for premium on conversion of FCCB (7,858.20) Add: foreign exchange fluctuation 691.50 Closing balance 2,839.89

* Premium payable on redemption of FCCB ` 9,880.90 lakhs has been fully provided for and has been charged to securities premium account. During the period, Bond holders holding bonds aggregating Euro 633.50 lakhs have opted to convert their bonds into equity shares. During the Period 2008, FCCBs have been reclassified as non-monetary liabilities pursuant to inter-alia the current trend of earnings and market price of the Company's equity share exceeding the conversion price stipulated in the offer document (bondholders holding 75.42% of the FCCB have exercised conversion option to this date). Consequently, the foreign exchange fluctuation loss aggregating to ` 438.10 lakhs accounted in Period 2007 and year ended 31 March 2006 has been reversed during the period in the Profit and Loss account and foreign exchange fluctuation loss of ` 3,621.80 lakhs for the financial period has not been recognised in the profit and loss account. (Refer note (c) of B of Annexure IV)

8. For Period 2008, subsidiaries in USA, UK, Mauritius, and Netherlands have been considered as integral to the operations of the Parent Company in India.

VI. Period 2007

1. Composite Scheme of amalgamation and arrangement

The Board of Directors of the Company at their meeting held on 22 April 2006 approved the Composite Scheme of amalgamation and arrangement between the Company, Entertainment One India Limited (‘E-ONE’), Adlabs Multiplexes and Theatres Limited (‘AMTL’) and Reliance Broadcast Network Limited (‘RBNL’). The shareholders of the Company accorded their approval to the Composite Scheme at the Annual General Meeting on 29 July 2006. The Composite Scheme was approved by the Hon’ble High Court of Judicature at Bombay vide its order dated 15 September 2006. The Composite Scheme interalia provides for the following: the amalgamation of E-ONE with the Company effective 1 April 2005; the merger of the digital business of AMTL with the Company effective 1 April 2005; and the demerger of the radio business of the Company to RBNL effective 31 March 2006.

The Company has made an application to the Ministry of Information and Broadcasting for vesting of radio licenses held by it in the name of RBNL. Pending the said approval, the Composite Scheme has not been filed with the Registrar of Companies (ROC) as required under section 391(3) of the Act, 1956. However, for the purpose of these financial statements, pending completion of licensing and other procedural formalities, the Composite Scheme has been given effect to in view of the Court approval and to give effect to the substance of the Composite Scheme as approved by the Hon’ble High Court of Judicature at Bombay. In accordance with the requirements of the Composite Scheme, the merger of E-ONE as well as the digital business of AMTL and the demerger of the radio business of the Company has been accounted for as follows in the standalone financial statements of the Parent Company:

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Amalgamation of E-ONE with the Company with effect from 1 April 2005

As per the Scheme, E-ONE amalgamates with the Company retrospectively from 1 April 2005, the Appointed Date. All assets and liabilities of E-ONE as at 1 April 2005 have been recorded by the Company at their fair values. Since E-ONE was a wholly owned subsidiary of the Company, the investment by the Company in the shares of E-ONE have been cancelled against the assets and liabilities acquired on amalgamation. The excess of net assets taken over (at fair value) over the cost of investment in E-ONE amounting to ` 272.58 lakhs has been credited to ‘Amounts pending transfer to the Securities premium account and / or General reserve account as per the Scheme of amalgamation and arrangement’. On the filing of the Scheme with the ROC, the amount will be credited to General reserve account as per the requirements of the Scheme. The profit and loss account for the fifteen months ended 30 June 2007 also includes the (loss) of E-ONE for the period from 1 April 2005 to 31 March 2006 as per the financial statements of EONE for that period which were audited by a firm of Chartered Accountants other than B S R & Co. The details of the income and expenses comprising the net loss are given below. Merger of the digital business of AMTL with the Company with effect from 1 April 2005

As per the Scheme, the digital business of AMTL merges with the Company retrospectively from 1 April 2005, the Appointed Date. All assets and liabilities of the digital business of AMTL as at 1 April 2005 have been recorded by the Company at their book values. Since AMTL is a wholly owned subsidiary of the Company, no consideration has been paid against the assets and liabilities acquired. The excess of liabilities over the assets taken over (at book value) amounting to ` 44.69 lakhs has been debited to ‘Amounts pending transfer to the Securities premium account and / or General reserve account as per the Scheme of amalgamation and arrangement’. On the filing of the Scheme with the ROC, the amount will be debited to securities premium account as per the requirements of the Scheme. The profit and loss account for the fifteen months ended 30 June 2007 also includes the net (loss) of the digital business of AMTL for the period from 1 April 2005 to 31 March 2006 as per the financial statements of AMTL for that period which were audited by a firm of Chartered Accountants other than B S R & Co. The details of the income and expenses comprising the net loss are given below. Demerger of the radio business of the Company to RBNL with effect from 31 March 2006

As per the Scheme, the radio business of the Company stands transferred to RBNL with effect from 31 March 2006, the Appointed Date. All assets and liabilities of the radio business of the Company as at 31 March 2006 have been transferred at their respective book values. In consideration of the demerger of the radio business, RBNL will pay ` 10,000.00 lakhs to the Company and allot shares to the existing shareholders of the Company as per the Scheme. The aggregate value of net assets to be transferred pursuant to the Scheme in excess of ` 10,000.00 lakhs (which is recorded as receivable from RBNL) has been recorded in ‘Amounts pending transfer to the Securities premium account and / or General reserve account as per the Scheme of amalgamation and arrangement’. On the filing of the Scheme with the ROC, the amount will be debited to Securities premium account as per the requirements of the Scheme. The details of the income, expenses, assets and liabilities of the radio business not included in these financial statements are given below. To facilitate the demerger, the Company has cancelled its investment in RBNL with a corresponding debit

to ‘Amounts pending transfer to the Securities premium account and / or General reserve account as per the Scheme of amalgamation and arrangement’. On the filing of the Scheme with the ROC, this amount will be debited to Securities premium account.

The Company has also recorded reduction of ` 2,050.25 lakhs in value of its assets (debtors and loans and advances) by debit to ‘Amounts pending transfer to the Securities premium account and / or General

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reserve account as per the Scheme of amalgamation and arrangement’. On the filing of the Scheme with the ROC, this amount will be debited to Securities premium account.

The above is in conformity with accounting treatment prescribed by the Composite Scheme (except that pending filing of the Composite Scheme with the ROC, the relevant adjustments required to be made to Securities premium account / General reserves account have been recorded in ‘Amounts pending transfer to the Securities premium account and / or general reserves account as per the Composite Scheme of amalgamation and arrangement’). The provision for taxation has been calculated by management on the basis of these financial statements including the effect of the Composite Scheme. However, the Company’s actual tax liability for the tax financial year ended 31 March 2007 and thereafter would be determined based on the status of filing of the Composite Scheme. Had the Company followed the accounting treatment prescribed by AS-14 / generally accepted accounting principles in India: ` 272.58 lakhs arising from the merger of E-ONE with the Company and credited to the General reserve

account would have been credited to Capital reserve account; ` 44.69 lakhs arising from the merger of digital business of AMTL and debited to the Securities premium

account would have been debited to Goodwill; ` 7,960.39 lakhs arising on demerger of radio business and debited to the Securities premium account

would have been debited to the Profit and loss account; the loss of ` 5.00 lakhs on cancellation of investment of the Company in RBNL would have been debited

to the Profit and loss account instead of the Securities premium account; and reduction of ` 2,050.25 lakhs in value of the Company’s assets would have been debited to the Profit and

loss account instead of the Securities premium account.

Accordingly, had the Composite Scheme been accounted for in compliance with the requirements of AS 14 – ‘Accounting for Amalgamations’ / generally accepted accounting principles in India on a standalone basis for the Parent Company, the profit for the period before tax would have been lower by ` 10,015.64 lakhs, General reserve account would have been lower by ` 272.58 lakhs, Capital reserves account would have been stated at 272.58 lakhs, Securities premium would have been higher by 10,065.33 lakhs and Goodwill would have been stated at ` 44.69 lakhs. During Period 2007, as E-ONE and AMTL carried on their existing business in trust for and on behalf of the Company, all vouchers, documents etc. for the period are in the name of E-ONE and AMTL. The title deeds, licenses, agreements, loan documents etc., are being transferred in the name of the Company. The net results for the period of E-ONE and digital business of AMTL included in these financial statements comprises:

E-ONE AMTL Period 2007

(`̀ in lakhs) Year ended 31 March 2006 (` in

lakhs)

Period 2007 (` in lakhs)

Year ended 31 March 2006 (` in

lakhs)

Sales and services (net) 62.12 206.54 55.88 183.85 Other income 0.09 0.42 69.22 2.16

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E-ONE AMTL Period 2007

(`̀ in lakhs) Year ended 31 March 2006 (` in

lakhs)

Period 2007 (` in lakhs)

Year ended 31 March 2006 (` in

lakhs)

Total revenue 62.21 206.96 125.10 186.01 Cost of sales and services - - 44.86 61.52 Personnel costs 3.65 53.47 2.87 5.75 Depreciation and amortisations 2.78 4.15 71.64 73.77 Interest expenses 13.20 62.57 - - Other costs 23.92 255.62 20.47 56.09 (Loss) / profit before tax 18.66 (168.85) (14.74) (11.12) Current tax - - - - Fringe benefit tax - 2.10 - - Deferred tax - 13.12 - - Net profit / (loss) after tax 18.66 (184.07) (14.74) (11.12) During the period, the Company carried on the radio business in trust for and on behalf of RBNL. The amount of revenue and expenses for Period 2007 and the assets and liabilities as at 30 June 2007 relating to the demerged radio business and which, pursuant to the Court approved Composite Scheme, have not been recognised in these financial statements are as under: Period 2007 (` in

lakhs)

Income 3,320.30 Expenditure* 12,695.00 Fringe benefit tax 75.50 (Loss) after tax (9,450.20) Fixed assets ** 29,451.69 Current assets 4,530.21 Current liabilities 41,432.10 Loans 2,000.00 * - includes ` 2,086.68 lakhs being interest charged by the Company on net funds utilised in carrying on the radio business in trust for and on behalf of RBNL. Also, ` 347.40 lakhs being interest on loan taken by the Company from RBNL has not been considered above as the said loan has been considered as repayment towards funding by the Company of the radio business. **- represents the gross value of the fixed assets of the Radio business, i.e. prior to giving effect to the adjustment of ` 7,960.39 lakhs as per the Composite Scheme. Accounting policies specific to the Radio business are as under:

Intangible assets and amortisation

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One Time Entry Fees paid for acquiring new licenses has been capitalised as an asset and is amortised over a period of ten years, being the period of the license, from the date of operationalisation of the station.

Revenue recognition Revenue from radio broadcasting is recognised on an accrual basis on the airing of customer's commercials.

License fees As per the new Frequency Module (FM) broadcasting policy, effective 1 April 2005 license fees are charged to revenue at the rate of 4% of gross revenue for the period or 10% of Reserve One Time Entry Fee (ROTEF) for the concerned city, whichever is higher. Gross revenue for this purpose shall mean revenue on the basis of billing rates inclusive of any taxes and without deduction of any discount given to the advertiser and any commission paid to advertising agencies. Barter advertising contracts shall also be included in the gross revenue on the basis of relevant billing rates. ROTEF means 25% of highest valid bid in the city.

As the Scheme has been given effect to, the aggregate of the Company's qualifying loans and advances and investments is in excess of the limits prescribed under Section 372A of the Act and for which prior approval of the shareholders has not been obtained. These financial statements do not include adjustments, if any, that would be required should the shareholders not accord their approval.

Further, the Company has raised money by way of issue of FCCB on 25 January 2006. The Company had utilised ` 6,502.82 lakhs from the proceeds of the issue towards the said radio business till 31 March 2006. With effect from the Appointed Date i.e. 31 March 2006, the remaining proceeds will be utilised by the Company to fund the radio business in RBNL. During the period, the Company has utilised ` 10,128.00 lakhs for the radio business on behalf of RBNL and has charged interest from RBNL for the funds so utilised

2. Acquisition of Rave Entertainment Private Limited (‘REPL’)

On 31 May 2007, the Company entered into a Share Purchase Agreement ('SPA') with the shareholders of Rave Entertainment Private Limited ('REPL'), a company engaged inter-alia in the business of owning and operating multiplexes, for acquisition of 100% stake in that company. One of the conditions precedent to the SPA is the approval by the Hon'ble High Court of Judicature at Allahabad of the Scheme of demerger filed by REPL for demerger of Kanpur properties. Pending approval of the Scheme of demerger by the said Court, the shares of REPL are held in Escrow and the consideration of ` 500.00 lakhs has been disclosed under loans and advances. The Company has also placed ` 2,550.00 lakhs in escrow, which amount will be adjusted in future as per the terms of the conducting agreement.

3. Acquisition of Katch 22 Entertainment Private Limited (‘Katch 22’)

During Period 2007, the Company acquired 100% stake in Katch 22 Entertainment Private Limited. Subsequently, pursuant to the board of directors approval vide resolution dated 26 April 2007, the Company filed a Scheme of amalgamation of Katch 22 with the Hon’ble High Court of Judicature at Bombay for the merger of Katch 22 Entertainment Private Limited with the Company effective 1 April 2006. The said Scheme is pending approval of the Court and hence has not been given effect to in these financial statements.

261

4. Lease disclosure under AS 19 - ‘Leases’ The Group is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the terms of the respective agreements. The future minimum lease payments in respect of non-cancellable operating leases are as follows:

Particulars Period 2007 (` in lakhs)

For the Parent Company Amounts due within one year from the balance sheet date 1,710.25 Amounts due in the period between one year and five years 7,032.58 Amounts due after five years 6,216.76 Total 14,959.59 For Subsidiaries Amounts due within one year from the balance sheet date 12.00 Amounts due in the period between one year and five years 12.06 Total 24.06 For Joint venture (Group’s share) Amounts due within one year from the balance sheet date 106.40 Amounts due in the period between one year and five years 177.33 Total 283.73

Amount debited to profit and loss account for lease rental is ` 2,509.90 lakhs. 5. Interest in Joint ventures

Name of the Company Country of incorporation % of Ownership Interest as on 30

June 2007 Swanston Multiplex Cinemas Private Limited India 50.00% Adlabs Multiplex Limited India 50.00% Cineplex Private Limited India 50.00% Divyashakti Marketing Private Limited India 50.00%

Details of Joint ventures

Particulars Period 2007 (` in lakhs)

I. Assets

1. Fixed assets (including Capital work-in-progress) 1,789.22 2. Investments 78.59 3. Current assets, loans and advances

a) Inventories 14.02

262

Particulars Period 2007 (` in lakhs)

b) Sundry debtors 104.37 c) Cash and bank balances 104.71 d) Interest accrued but not due 0.54 e) Loans and advances 358.00 II. Liabilities 1. Shareholders’ fund 1,093.28 2. Unsecured loans 682.11 3. Deferred tax liability (net) 120.44 4. Current liabilities and provisions a) Liabilities 323.16 b) Provisions 230.46 III. Income 1. Sales (net of duties and taxes) 2,191.01 2. Other income 22.28 IV. Expenses 1. Operating expenses 1,553.86 2. Depreciation 177.81 3. Interest 8.35 4. Profit before tax 473.27 5. Prior period Adjustments 14.68 6. Provision for tax (including deferred tax) 177.89 7. Profit after tax 280.70 V. Other matters 1. Contingent liabilities 1,016.09 2. Capital commitments - Movement of the aggregate shareholders’ funds of the joint ventures: As at the beginning of the period 595.66 Add: Share of profit for the period 497.62 As at the end of the period 1,093.28

263

6. Foreign currency exposures (other than investments and fixed assets) not covered by forward contracts

Particulars Currency Period 2007

Amount (Foreign currency in lakhs)

Amount (`̀ in lakhs)

Sundry debtors USD 6.80 275.10 GBP 0.10 3.70 Euro 0.10 6.40 Sundry creditors USD 6.60 269.00 Foreign currency convertible bonds (‘FCCB’) (Refer note (c) of B of Annexure IV)

Euro 840.00 46,158.00

Provision for premium on redemption of FCCB

Euro 182.10 10,006.60

7. Foreign Currency Convertible Bonds (‘FCCB’) On 25 January 2006 the Company (‘Issuer’) issued Zero Coupon Foreign Currency Convertible Bonds (‘Bonds’ or ‘FCCB’) aggregating Euro 840 lakhs. The Bonds are convertible at any time on or after 7 March 2006 and upto the close of the business on 19 January 2011 by the holders of the Bonds (‘the Bondholders’) into newly issued equity shares of the Company with full voting rights with par value of ` 5 each (‘Shares’) at an initial conversion price (as defined in Terms and Conditions of the Bonds) of ` 543.42 per share with a fixed rate of exchange on conversion of ` 54.26=EUR 1.00. The conversion price is subject to adjustment in certain circumstances. The Bonds are listed on the Singapore Exchange Securities Trading Limited (‘SGXST’). The Bonds may be redeemed, in whole but not in part, at the option of the Issuer at any time on or after 25 January 2009 and on or prior to 26 January 2011 subject to satisfaction of certain conditions. Unless previously redeemed, converted or purchased and cancelled, the bonds will mature on 26 January 2011 at 121.679 per cent of the principal amount. As at 30 June 2007, there has been no conversion of the Bonds into Shares. Premium on redemption of FCCB

Period 2007 (` in lakhs)

Opening balance 9,880.94* Add: foreign exchange fluctuation 125.65 Closing balance 10,006.59

* Premium payable on redemption of FCCB ` 9,880.94 lakhs has been fully provided for and has been charged to securities premium account. In the event that the conversion option is exercised by the holders of FCCB in the future, the amount of premium charged to the securities premium account will be suitably adjusted in the respective years.

264

(Refer note (c) of B of Annexure IV) 8. For Period 2007, subsidiaries in USA and UK have been considered as integral to the operations of the

Parent Company in India.

265

Annexure V

Reliance MediaWorks Limited 10 Statement of share capital (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Authorised

Equity shares of ` 5/-each 4,000.00 5,000.00 5,000.00 4,602.90 3,000.00 3,000.00

Preference shares of `5/-each 1,000.00 - - - - -

5,000.00 5,000.00 5,000.00 4,602.90 3,000.00 3,000.00

Issued, subscribed and paid-up capital

Equity shares of ` 5/- each, fully paid-up 2,306.30 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04

10 % redeemable non convertible non cumulative preference shares (Preference shares) of ` 5/- each, fully paid-up 147.50 - - - - -

2,453.80 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04

(refer notes (a) to (h) below)

(a) Reconciliation of the shares outstanding at the commencement and at the end of the period As at

31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

Equity shares

No of Shares No of Shares No of Shares No of Shares No of Shares No of

Shares (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs)

At the commencement of the

461.26

461.26

461.26

461.26

398.00

398.00

266

Annexure V

Reliance MediaWorks Limited 10 Statement of share capital (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

period

Share issued during the period - - - - 63.26 -

At end of the period 461.26 461.26 461.26 461.26 461.26 398.00

Preference shares

No of Shares No of Shares No of Shares No of Shares No of Shares No of

Shares (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs)

At the commencement of the period - - - - - -

Share issued during the period 29.50 - - - - -

At end of the period 29.50 - - - - -

(b) Rights, preferences and restriction attached to equity shares

The Company has only one class of equity shares having par value of ` 5 per share. Each equity holder is entitled to one vote per share. The Company declares and pays dividends, if any, in Indian Rupees. The dividend proposed, if any by the Board of the Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

(c) Rights, preferences and restriction attached to Preference share

267

Annexure V

Reliance MediaWorks Limited 10 Statement of share capital (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

Preference shares shall be redeemed at the end of 20 years from the date of allotment i.e. each Preference shares shall be redeemed at a premium calculated in a manner that gives the holder an yield of 10% p.a. (till date of redemption ) on issue price of ` 1,000 (including premium of ` 995) after deduction of dividend, if any declared during the tenure. However, the premium on redemption will be paid only to the original subscribers or to the transferees if the transfers have been previously approved by the Company. Further early redemption at the option of holder of Preference shares can be done, at issue price plus yield as mentioned above, at any time after the date of allotment by giving not less than two months advance notice to the Company. Early redemption at the option of Company at the applicable redemption price can be done, any time after the date of allotment by giving not less than 30 days notice to the Preference share holder.

(d) Names of shareholders holding more than 5% of equity share in the Company

No of Shares No of Shares No of Shares No of Shares No of Shares No of

Shares (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs)

Reliance Land Private Limited 206.00 206.00 206.00 206.00 206.00 206.00

Reliance Capital Limited 85.29 81.05 81.05 29.55 - -

AAA Entertainment Private Limited - - - 48.00 48.00 -

Bhupati Consultancy Services Private Limited - - - - - 48.00

Mr. Manmohan Shetty - - - - - 22.91

% holding in

the class % holding in

the class % holding in

the class % holding in

the class % holding in

the class % holding in the class

Reliance Land Private Limited 44.66% 44.66% 44.66% 44.66% 44.66% 51.76%

Reliance Capital Limited 18.49% 17.57% 17.57% 6.41% - -

AAA Entertainment Private Limited - - - 10.40% 10.40% -

268

Annexure V

Reliance MediaWorks Limited 10 Statement of share capital (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Bhupati Consultancy Services Private Limited - - - - - 12.06%

Mr. Manmohan Shetty - - - - - 5.76%

(e)

Names of shareholders holding more than 5% of Preference share in the Company

No of Shares No of Shares No of Shares No of Shares No of Shares No of

Shares (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs)

Reliance Infocomm Engineering Private Limited 12.00 - - - - -

Reliance Utility Engineers Private Limited 17.50 - - - - -

% holding in

the class % holding in

the class % holding in

the class % holding in

the class % holding in

the class % holding in the class

Reliance Infocomm Engineering Private Limited 40.68% N.A. N.A. N.A. N.A. N.A.

Reliance Utility Engineers Private Limited 59.32% N.A. N.A. N.A. N.A. N.A.

269

Annexure V

Reliance MediaWorks Limited 10 Statement of share capital (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 (f) Pursuant to shareholder approval dated 30 March 2012, the authorised share capital of the Company was

reclassified from 1,000 lakh equity shares of ` 5 each to 800 lakh equity shares of ` 5 each and 200 lakh preference shares of ` 5 each.

(g) During Period 2009, the authorised share capital of the Company has been increased as per the provisions of Scheme of Amalgamation by ` 1,602.90 divided into 32,058,000 shares of ` 5 each. (refer note 1 of VI of E of Annexure IV)

(h) During the Period 2008, bond holders holding bonds aggregating EURO 633.50 lakhs have opted to convert their bonds to equity shares. Accordingly, equity shares aggregating to 63.26 lakhs have been issued to them at a price of ` 543.42 per share (including securities premium of ` 538.42).

270

Annexure VI

Reliance MediaWorks Limited Summary statement of reserves and surplus, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

a) Securities premium reserve

At the commencement of the period 46,862.14 47,235.25 46,862.75 63,815.65 25,824.54 24,663.19

Less : Provision for premium on redemption of Zero Coupon Foreign Currency Convertible Bonds ('FCCB') (Also refer note (c ) of B of Annexure IV) - (373.11) 372.50 (244.90) (691.50) (125.65) Add : On issuance of equity shares pursuant to conversion of FCCB’s - - - - 34,161.66 - Add : Premium on issuance of preference shares 29,352.50 - - - - - Less: Adjustment pursuant to Katch 22 Scheme (Refer note 3 of V of E of Annexure IV) - - - - (1,287.00) - Add : Addition during the year - - - - - 1,287.00

Add : Reversal of provision for premium on FCCB converted - - - - 7,858.20 -

271

Annexure VI

Reliance MediaWorks Limited Summary statement of reserves and surplus, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

during the period (Also refer note (c ) of B of Annexure IV) Less : Adjustment pursuant to Modified Composite Scheme of Amalgamation and Arrangement (Refer note 1 of V of E of Annexure IV) - - - - (2,050.25) - Less: Adjustment pursuant to Scheme of Arrangement for demerger of Radio business (refer note 1 of IV of E of Annexure IV) - - - (16,708.00) - - 76,214.64 46,862.14 47,235.25 46,862.75 63,815.65 25,824.54

b) General reserve At the commencement of the period 790.62 888.42 1,210.22 1,324.82 5,633.54 4,730.00 Add : Transfer from Statement of profit and loss 151.03 - - - 11,580.20 903.54

Add : Transfer on account of Scheme of Amalgamation of Katch 22 (Refer note 3 - - - - 201.80 - of V of E of Annexure IV)

272

Annexure VI

Reliance MediaWorks Limited Summary statement of reserves and surplus, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Less : Reduction in value of Companies assets pursuant to Scheme of Amalgamation of Katch 22 (Refer note 3 of V of E Annexure IV) - - - - (2,000.00) - Less : Net result of the transactions relating to Radio business adjusted pursuant to Modified Composite Scheme of Amalgamation and Arrangement (Refer note 1 of V of E of Annexure IV) - - - - (14,363.30) -

Less: Transferred to Capital Redemption reserve (29.70) (97.80) (321.80) (114.60) - -

Add : Adjustment pursuant to Modified Scheme of Amalgamation - - - - 272.58 -

and Arrangement (Refer note1of V of E of Annexure IV) 911.95 790.62 888.42 1,210.22 1,324.82 5,633.54

273

Annexure VI

Reliance MediaWorks Limited Summary statement of reserves and surplus, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 c) Capital

reserve on consolidation - - - 240.70 - -

d) Capital reserve –I At the commencement and end of the period 33.88 33.88 33.88 33.88 33.88 33.88

e) Capital

reserve - II At the

commencement of the period 5,826.20 5,826.20 5,826.20 - - - Amounts transferred to Capital reserve as per provisions of the Scheme of Amalgamation (Refer note 2 of IV of E of Annexure IV) - - - 5,826.20 - - 5,826.20 5,826.20 5,826.20 5,826.20 - -

f) Capital redemption reserve At the commencemen 534.20 436.40 114.60 - - - t of the period Add: Transferred from profit and loss 9.50 - - - - - Add: 29.70 97.80 321.80 114.60 - - Transferred from general reserve 573.40 534.20 436.40 114.60 - -

g) Foreign Currency Translation Reserve

274

Annexure VI

Reliance MediaWorks Limited Summary statement of reserves and surplus, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 At the commencement of the period (314.86) (428.67) 262.31 - - - Add: Foreign currency translation gain / (loss) on non-integral operations (net) 1,488.11 113.81 (690.98) 262.31 - - 1,173.25 (314.86) (428.67) 262.31

h)

Amount pending transfer to the Securities premium reserve and / or the General reserve as per the Composite Scheme of Amalgamation and Arrangement (Refer note 1 of V of E of Annexure IV and note 1 of

VI of E of Annexure IV )

i) Pending transfer to Securities premium reserve At the commencement of the period - - - - (10,015.64) - On demerger of Radio business - - - - - (7,965.39) On reduction in value of Company's assets - - - - - (2,050.25)

275

Annexure VI

Reliance MediaWorks Limited Summary statement of reserves and surplus, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 On merger of digital business of AMTL - - - - - - Reversal due to the Modified Scheme of Amalgamation and Arrangement - - - - 7,965.39 - Transfer to Securities premium reserve - - - - 2,050.25 - - - - - - (10,015.64)

ii) Pending transfer to General reserve At the commencement of the period - - - - 272.58 - On merger of E-ONE transfer to General Reserve - - - - (272.58) 272.58 Transfer to - - - - - 272.58

General reserve

I) (Deficit) / Surplus in Statement of profit and loss

At the commencemen (53,331.65) (20,480.20) (7,614.52) 302.10 11,340.58 3,002.12

t of the period (Loss) / Profit for the period, as per Statement of profit and loss (57,216.63) (32,796.95) (12,803.08) (7,786.52) 1,998.52 10,418.41

276

Annexure VI

Reliance MediaWorks Limited Summary statement of reserves and surplus, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Reduction of Reserves of Sri Ramkrishna Theatres Limited and share of Cineplex Private Limited, on sale

321.68 - - - - -

Appropriations Transfer to general reserve 151.03 - - - 11,580.20 903.54 Capital redemption reserve 9.50 - - - - - Proposed dividend on preference shares of a subsidiary 43.85 46.60 53.50 76.00 84.00 - Proposed dividend on equity shares of a subsidiary - - - - 1,153.15 995.02 Dividend tax on proposed dividend on 7.15 7.90 9.10 12.91 14.28 -

preference shares of a subsidiary Dividend tax on proposed dividend on equity shares 63.70 - - 41.19 205.37 181.39 (111,145.19) (53,331.65) (20,480.20) (7,614.52) 302.10 11,340.58

(26,411.87) 400.53 33,511.28 46,936.14 65,476.45 33,089.48 The above statement should be read together with significant accounting policies and notes to summary statements of the Group (Annexure IV)

277

Annexure VII

Reliance MediaWorks Limited Statement of non-current investment, deferred tax assets, long-term loans and advances and other non-current assets, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

A Non-current investments

I Investment in

Equity Instruments (Unquoted)

Others (non-trade, unquoted and at cost)

a Sultan Production Private Limited (refer note 6 of III of E Annexure IV) -

-

1.00

1.00

1.00

-

b Manipal Industries Limited -

0.01

0.01

0.01

0.01

-

c Efficient Management Services Private Limited -

0.02

0.02

0.02

0.02

-

Others (non-trade,

quoted and at cost)

Prime Focus Limited (Quoted) -

-

-

-

-

466.58

-

0.03

1.03

1.03

1.03

466.58

II Investment in

Partnership Firm (Unquoted and at cost)

a Gold Adlabs 527.42

540.30

524.50

503.40

529.60

530.65

b HPE / Adlabs LP 1,999.30

1,999.30

1,999.30

2,241.00

4,607.75

4,607.75

(2009 and 2010 ` 2,366.80 lakhs towards recovery of principal pursuant to a contract and 2010;

278

Annexure VII

Reliance MediaWorks Limited Statement of non-current investment, deferred tax assets, long-term loans and advances and other non-current assets, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

` 241.7 lakhs has been repaid by the partnership firm as principal) Less : -Provision for diminution in value of the long term investments (1,999.30)

(1,999.30)

(1,999.30)

(2,241.00)

-

-

527.42

540.30

524.50

503.40

5,137.35

5,138.40

III Investment in preference shares (non-trade, unquoted and at cost)

Tree of Knowledge DOT Com Private Limited # -

-

-

1,200.00

1,200.00

1,200.00

Less : -Provision for diminution in value of the long term investments -

-

-

(1,200.00)

-

-

-

-

-

-

1,200.00

1,200.00

IV Investment in

Government securities (trade, unquoted and at cost)

Government securities

1 National savings certificates 32.50

34.30

114.40

104.50

100.20

97.89

(Pledged with State government authorities)

2 Rural Electrification Corporation Bond -

-

22.00

22.00

22.00

-

32.50

34.30

136.40

126.50

122.20

97.89

279

Annexure VII

Reliance MediaWorks Limited Statement of non-current investment, deferred tax assets, long-term loans and advances and other non-current assets, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 V Investment in

mutual fund (non-trade, unquoted and at lower of cost and fair value) 16.00

518.36

610.48

530.79

530.79

365.29

Total 575.92

1,092.99

1,272.41

1,161.72

6,991.37

7,268.16 Aggregate value of

unquoted investments 2,575.22 3,092.29 3,271.71 4,602.72 6,991.37 7,268.16

Aggregate provision for diminution in value of investments 1,999.30 1,999.30 1,999.30 3,441.00 - -

B Deferred tax asset Arising on account

of timing difference in:

Provision for leave encashment and gratuity 198.70 274.60 130.50 137.10 207.30 79.26

Others 1,803.72 39.20 79.30 584.10 186.10 115.29 Unabsorbed

depreciation allowance and carried forward business loss * 3,497.65 4,101.77 2,215.30 1,093.90 1,899.30 -

5,500.07 4,415.57 2,425.10 1,815.10 2,292.70 194.55 Deferred tax

liability Arising on account

of timing difference in:

Depreciation/ amortisation 5,076.72 4,929.36 2,485.89 1,862.99 2,420.33 1,602.74

Others 428.64 - 0.40 - - - 5,505.36 4,929.36 2,486.29 1,862.99 2,420.33 1,602.74 Net deferred tax

assets / (liabilities) (5.29) (513.79) (61.19) (47.89) (127.63) (1,408.19)

280

Annexure VII

Reliance MediaWorks Limited Statement of non-current investment, deferred tax assets, long-term loans and advances and other non-current assets, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 * Restricted to the

extent of deferred tax liability due to absence of virtual certainty

The net asset /

(liability) has been shown as the Group does not have the option to set off the balances of individual Companies.

Deferred tax asset 0.80 2.60 2.20 18.70 64.40 - Deferred tax

liability 6.09 516.39 63.39 66.59 192.03 1,408.19 Net deferred tax

asset / (liability) (5.29) (513.79) (61.19) (47.89) (127.63) (1,408.19) C Long-term loans

and advances - Unsecured,

considered good I

Capital advances 676.30

1,712.91

2,868.32

1,931.27

9,613.49

1,202.99 II

Security deposits 15,593.40

17,788.75

17,484.12

16,926.55

14,799.22

5,516.16 III

Loans to others 360.20

206.20

266.11

320.00

385.30

- IV

Advance tax, tax deducted at source, advance fringe benefit tax (net of provision for tax Period 2012 - ` 595.20, Period 2011 - ` 684.70, Period 2010 – ` 1,196.43, Period 2,541.40

3,728.51

5,418.49

4,155.47

3,450.82

2,099.55

2009 - ` 3,912.24, Period 2008 - ` 4,666.87, Period 2007 - ` 2,801.72)

V Advance towards investment 5,000.00

5,000.00

-

-

-

-

281

Annexure VII

Reliance MediaWorks Limited Statement of non-current investment, deferred tax assets, long-term loans and advances and other non-current assets, of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 VI

Others * 1,654.20

935.00

1,130.95

1,485.00

1,044.52

169.43

25,825.50

29,371.37

27,167.99

24,818.29

29,293.35

8,988.13 *Prepaid expenses

and entertainment tax paid under protest etc.

D Other non-current assets

I Interest accrued but

not due 22.20

49.00

52.50

49.10

33.44

115.14 II Fixed Deposits

with bank -

99.00

-

-

-

- III

Gratuity -

9.80

-

-

-

- IV Balance with bank

- Margin money deposit* 29.90

231.50

224.92

10.31

10.31

5,002.61

52.10

389.30

277.42

59.41

43.75

5,117.75

*Margin money deposits are under bank lien for guarantees given by the Company

# These shares have been forfeited during Period 2010 The above statement should be read with significant accounting policies and notes to summary statements, as restated (Annexure IV)

Notes: 1. The list of parties related to directors/ promoters are as follows:

Particulars 31 March

2012 31 March 2011

31 March 2010

31 March 2009

31 March 2008

30 June 2007

Loans, advances and other receivables

KGS Developers Limited 63.00 263.00 563.00 563.00 563.00 - Total 63.00 263.00 563.00 563.00 563.00 -

282

2. Above data excludes amounts due from parties related to the issuer Company, which has been disclosed

in Annexure XVIII as part of related party disclosures. 3. As per para (21) (B)(IX) Part A Schedule VIII of SEBI ICDR Regulations, Company shall disclose in

the offer document whether any of the receivable are related to directors or promoters or the issuer in any way. In absence of clarification on “related to the directors or promoters”, Company has disclosed amounts due from relatives of directors as defined in Schedule IA of the Companies Act, 1956 and in case of promoters, amount due from “Promoter Group” and “Group Companies” as defined in SEBI ICDR Regulation. The List of persons / entities classified as “Promoter Group” and “Group Companies” has been determined by the Group and relied upon by the Auditors. 4. Refer note 2 of IV of E of Annexure IV, note 1 of V of E of Annexure IV and note 3 of V of E of Annexure IV for advances written off pursuant to Schemes.

283

Annexure VIII Reliance MediaWorks Limited Statement of current assets, of the Group, as restated (` in lakhs) As at

Particulars 31 March 2012

31 March 2011

31 March 2010

31 March 2009

31 March 2008

30 June 2007

A Current

investments I Investment in

mutual fund (non-trade, unquoted and at lower of cost and fair value)

Investment in mutual funds - 10.44 7,902.30 - 13,556.71 98.38

- 10.44 7,902.30 - 13,556.71 98.38 Market value of

current investment - 10.44 7,906.70 - 13,556.71 98.38

B Inventories (valued at lower

cost and net realisable value) (refer note 8 of A of Annexure IV)

I Stores and spares 541.20 482.40 356.50 388.00 57.80 40.33 II Chemical stock 30.00 20.70 16.50 33.50 17.20 25.90 III Food and

beverages 368.80 433.00 371.70 154.80 67.60 47.80 IV Negative film rolls 50.10 52.40 54.10 54.60 58.80 61.50 V Content not aired 121.40 334.90 60.70 - 515.80 1.20 VI Stocks of DVD's - 1.90 47.70 59.60 44.10 33.20 1,111.50 1,325.30 907.20 690.50 761.30 209.93 C Trade receivables Unsecured,

considered good; I Debts outstanding

for a period exceeding six months from the date they are due for payments 15,201.90 16,175.70 13,145.50 14,184.30 1,518.70 1,167.51

Other debts 6,203.20 5,424.90 10,085.10 6,847.40 10,622.80 4,727.78 21,405.10 21,600.60 23,230.60 21,031.70 12,141.50 5,895.29

284

Annexure VIII Reliance MediaWorks Limited Statement of current assets, of the Group, as restated (` in lakhs) As at

Particulars 31 March 2012

31 March 2011

31 March 2010

31 March 2009

31 March 2008

30 June 2007

Unsecured, considered doubtful;

II Debts outstanding for a period exceeding six months from the date they are due for payments 1,974.40 724.60 49.60 - 224.10 14.33

Other debts - - - 40.60 93.80 - 1,974.40 724.60 49.60 40.60 317.90 14.33 Less: Provision for

doubtful debts 1,974.40 724.60 49.60 40.60 317.90 14.33 - - - - - - 21,405.10 21,600.60 23,230.60 21,031.70 12,141.50 5,895.29 D Cash and bank

balances Cash and cash

equivalents I Balances with

banks - in current

accounts 1,526.50 5,003.80 2,809.80 3,235.00 2,364.80 3,837.00 - in fixed deposit

account with original maturity less than three months 936.40 223.55 1,489.59 228.50 3,372.30 1,126.27

II Cash on hand 399.90 234.40 257.70 196.00 91.60 131.67 - Foreign

Currency denominated preloaded cards - - - - 1.70 6.06

2,862.80 5,461.75 4,557.09 3,659.50 5,830.40 5,101.00 III Other bank

balances - in dividend

account 10.50 12.20 13.80 14.60 8.20 6.77 - in escrow

account - - - - - 2,550.00 - in fixed deposit

account maturing 734.50 757.11 648.49 1,535.61 1,391.90 3,400.00 with in a year

285

Annexure VIII Reliance MediaWorks Limited Statement of current assets, of the Group, as restated (` in lakhs) As at

Particulars 31 March 2012

31 March 2011

31 March 2010

31 March 2009

31 March 2008

30 June 2007

- in margin money deposit maturing with in a year* 4,666.00 5,541.93 3,051.59 2,672.28 5,145.99 136.49

5,411.00 6,311.24 3,713.88 4,222.49 6,546.09 6,093.26 8,273.80 11,772.99 8,270.97 7,881.99 12,376.49 11,194.26 *Margin money

deposits are under bank lien for guarantees given by the Company

E Short-term loans

and advances - Unsecured,

considered good I Amount due from

Reliance Broadcast Network Limited pursuant to demerger of Radio business 6,095.00 6,095.00 26,095.00 26,095.00 - -

II Loans to others 910.90 1,507.90 1,136.69 2,745.40 14,071.10 33,838.06 III Deposits 1,046.20 1.85 35.48 0.05 0.08 0.14 IV Advance tax, tax

deducted at source, advance fringe benefit tax (net of provision for tax of Period 2012 : ` 48.25 2011 : ` 112.10, 2010: ` 419.00 2009: ` 530.96, 2008: ` 295.76 and 2007: ` 243.91) 668.10 688.97 275.08 66.99 27.65 13.32

V Others * 5,025.80 4,908.29 9,024.40 5,972.23 10,925.78 6,384.91 13,746.00 13,202.01 36,566.65 34,879.67 25,024.61 40,236.43 - Unsecured,

considered doubtful Loans to others 193.00 - - - - - Others* 1,032.00 979.50 120.60 0.60 66.50 0.72

286

Annexure VIII Reliance MediaWorks Limited Statement of current assets, of the Group, as restated (` in lakhs) As at

Particulars 31 March 2012

31 March 2011

31 March 2010

31 March 2009

31 March 2008

30 June 2007

Less: Provision for doubtful advances 1,225.00 979.50 120.60 0.60 66.50 0.72

- - - - - - 13,746.00 13,202.01 36,566.65 34,879.67 25,024.61 40,236.43 *includes service

tax credit, prepaid expenses, employee advance, advances to vendors etc.

F Other current

assets I Unbilled revenue 1,217.10 1,461.90 217.00 125.10 - - II Interest accrued

and due from Reliance Broadcast Network Limited 4,507.00 3,930.20 2,481.60 - - -

III Interest accrued but not due 67.50 178.70 91.30 209.40 900.66 116.20

IV Other receivables for sale of investment / Right to investment

- - - 4,066.80 3,127.30 -

5,791.60 5,570.80 2,789.90 4,401.30 4,027.96 116.20 The above statement should be read with significant accounting policies and notes to summary statements, as restated (Annexure IV) Notes: 1. The list of parties related to directors / promoters (as per SEBI ICDR Regulations, 2009) are as

follows:

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Trade receivables Reliance Capital Limited 31.65 37.40 43.42 1.63 - -

Reliance Capital Asset Management Limited 10.00 32.29 4.38 0.26 - - Gini & Jony Apparel Private Limited - 1.23 0.03 0.56 - - TV Today Network Limited - 0.09 - - - - Reliance Equity Advisors (India) Limited 0.31 - - - - -

287

Annexure VIII Reliance MediaWorks Limited Statement of current assets, of the Group, as restated (` in lakhs) As at

Particulars 31 March 2012

31 March 2011

31 March 2010

31 March 2009

31 March 2008

30 June 2007

Reliance Broadcast Network Limited 1,376.70 1,376.70 1,337.90 - - - Reliance Life Insurance Company Limited 5.33 0.92 - - - - Loans, advances and other receivables

Reliance Broadcast Network Limited 10,741.74 10,025.20 28,749.80 26,095.00 - - Reliance Securities Limited - - - - 3,126.90 - Reliance Life Insurance Company Limited 9.00 9.00 9.00 20.00 - -

Total 12,174.73 11,482.83 30,144.53 26,117.45 3,126.90 -

2. Above data excludes amounts due from parties related to the issuer Company, which has been

disclosed in Annexure XVIII as part of related party disclosures. 3. As per para (21) (B)(IX) Part A Schedule VIII of SEBI ICDR Regulations, Company shall disclose

in the offer document whether any of the receivable are related to directors or promoters or the issuer in any way. In absence of clarification on “related to the directors or promoters”, Company has disclosed amounts due from relatives of directors as defined in Schedule IA of the Companies Act, 1956 and in case of promoters, amount due from “Promoter Group” and “Group Companies” as defined in SEBI ICDR Regulation. The List of persons / entities classified as “Promoter Group” and “Group Companies” has been determined by the Group and relied upon by the Auditors.

4. Refer note 2 of IV of E of Annexure IV, note 1 of V of E of Annexure IV and note 3 of V of E of Annexure IV for receivables and advances written off pursuant to Schemes.

288

Annexure IX

Reliance MediaWorks Limited Statement of non-current liabilities of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 A Long term

borrowing I Non convertible

debentures (secured) 35,000.00 - - - - - II Term loans - From banks

(secured) 25,576.70 36,131.60 39,671.57 40,000.00 37,500.00 - - From banks

(unsecured) - 7,500.00 - 3,130.46 - - - Others (secured) 176.47 - - - 2,500.00 0.40 III Zero Coupon Foreign

Currency Convertible Bonds ('FCCB') - - - 14,230.00 13,099.90 46,158.00

IV Other loans and

advances From other parties

(Secured) 173.90 - - - - - From other parties

(Unsecured) 923.53 798.51 733.43 - - - 61,850.60 44,430.11 40,405.00 57,360.46 53,099.90 46,158.40 B Other long-term

liabilities I Lease rent liability as

per AS 19 - "Leases" 5,132.90 2,784.55 1,419.60 820.05 342.98 244.96 II Dues for capital

expenditure 1.80 1.36 - - - - III Security deposit 129.20 123.14 49.30 51.80 - - 5,263.90 2,909.05 1,468.90 871.85 342.98 244.96

289

Annexure IX

Reliance MediaWorks Limited Statement of non-current liabilities of the Group, as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 C Long-term

provision

I Leave encashment 538.00 728.03 362.00 343.16 162.76 172.05 II Gratuity 82.10 46.68 21.20 6.45 36.34 37.99 III Premium on

redemption of FCCB - - - 3,084.79 2,839.89 10,006.59

620.10

774.71

383.20

3,434.40

3,038.99

10,216.63 The above statement should be read with significant accounting policies and notes to summary statements, as restated (Annexure IV) Note: 1. Also refer Annexure XV for principal terms and conditions for borrowings

290

Annexure X

Reliance MediaWorks Limited Statement of current liabilities, of the Group as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 A Short term

borrowing I Term loans - From banks

(secured) 7,500.00

-

-

10,000.00

-

- - Term loan

(unsecured) 15,948.10

23,500.00

40,000.00

10,000.00

-

- II Loans repayable

on demand (secured)

From banks

- Cash credit 3,129.40

3,264.00

985.20

37.16

293.30

344.08 III Other loans and

advances a From banks - Buyers credit

(unsecured) 3,920.30

318.00

1,392.60

926.80

-

- - Buyers credit

(secured) -

2,965.87

-

-

-

- - Others

(unsecured) -

-

1,885.19

1,897.32

-

- b Commercial

Papers (unsecured) -

57,842.40

72,683.00

49,024.50

38,688.70

11,835.60

c Inter-corporate deposit (unsecured) 26,605.00

15,000.00

-

-

2,046.30

-

d From other parties (Secured) -

100.40

-

-

-

-

e From other parties (Unsecured) -

187.49

456.76

223.89

290.92

323.47

57,102.80

103,178.16

117,402.75

72,109.67

41,319.22

12,503.15

Above includes

Borrowings from Promoters (as per SEBI ICDR 24,405.00

15,000.00

-

-

2,046.30

-

291

Annexure X

Reliance MediaWorks Limited Statement of current liabilities, of the Group as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Regulations,

2009) / Group companies / Subsidiaries / Material Associate companies

B Other current

liabilities I Current

maturities of long-term debts 54,566.70 50,633.53 35,421.68 3,130.46 0.40 3.64

II Interest accrued and due on borrowings 1,392.90 28.80 - - - -

III Interest accrued but not due on borrowings 350.70 63.68 50.53 30.00 - -

IV Unclaimed dividend 10.50 12.20 13.80 14.60 8.20 6.84

V Advance received from customers 1,683.80 2,453.30 1,759.40 924.60 5,395.10 2,636.28

VI Advance against sale of assets (Refer note of 8 of I of E of Annexure IV) 18,650.00 - - - - -

VII Dues for capital expenditure 3,436.69 3,334.60 4,315.04 2,147.50 716.17 409.28

VIII Others * 7,933.17 3,233.46 2,663.57 2,957.71 2,929.75 1,625.53 88,024.46 59,759.57 44,224.02 9,204.87 9,049.62 4,681.57 *including

payable related to employee, expense payable and statutory dues etc.

C Short-term provision I Proposed

dividend - - - - 1,153.15 995.02

292

Annexure X

Reliance MediaWorks Limited Statement of current liabilities, of the Group as restated (` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 II Tax on proposed

dividend 70.80 7.90 9.11 41.30 210.35 169.10 III Gratuity 1.40 0.92 - 24.95 112.86 0.51 IV Leave

encashment 182.30 207.17 156.80 164.15 349.65 22.63

254.50

215.99

165.91

230.40

1,826.01

1,187.26 The above statement should be read with significant accounting policies and notes to summary statements, as restated (Annexure IV)

Note: Disclosure as per SEBI ICDR Regulations, 2009 are as follows

Particulars of Lenders

Principal Amount

(`̀ in lakhs)

Period when amount is

outstanding

Interest Rate Repayment Schedule

Reliance Capital Limited

2,046.30 Period 2008 12.00% Repayable on demand

Reliance Capital Limited

15,000.00 Period 2011 12.00% One year from date of the loan

Reliance Capital Limited

24,405.00 Period 2012 13.00% to 14.50% One year from date of the loan

The above statement should be read together with significant accounting policies and notes to summary statements (Annexure IV).

Note: 1. Also refer Annexure XV for principal terms and conditions for borrowings

293

Annexure XI

Reliance MediaWorks Limited Statement of revenue of the Group, as restated (` in lakhs)

Particulars Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Theatrical exhibition Sale of tickets 43,692.60 39,009.50 34,706.70 25,864.40 10,034.40 8,874.83 less: Entertainment tax 7,026.90 5,098.90 3,958.20 2,288.70 1,288.00 747.29 36,665.70 33,910.60 30,748.50 23,575.70 8,746.40 8,127.54 Advertisements / sponsorship revenue 2,290.80 3,684.20 4,651.70 1,465.20 1,437.80 896.23 Facilities provided at multiplex 1,533.60 1,054.70 737.30 647.30 329.10 245.84 Food and beverages 12,613.20 10,716.70 8,722.30 6,470.34 1,725.34 1,959.35 Others 2,399.30 2,011.70 1,850.20 1,012.60 - - 55,502.60 51,377.90 46,710.00 33,171.14 12,238.64 11,228.96

Film production services Processing/ printing of films 16,473.00 18,794.00 11,486.40 9,299.80 3,595.70 5,573.20 Equipment / facility rental income 2,430.90 2,084.60 1,566.50 612.40 265.30 76.63 Trading income 999.10 1,926.30 2,229.30 3,077.40 2,410.20 3,891.84 Others 94.90 44.30 72.30 67.40 - - 19,997.90 22,849.20 15,354.50 13,057.00 6,271.20 9,541.67

Film / content production, distribution and related services 6,244.40 4,980.30 9,442.70 19,707.20 12,259.10 14,770.84

Total 81,744.90 79,207.40 71,507.20 65,935.34 30,768.94 35,541.47 The above statement should be read with significant accounting policies and notes to summary statements, as restated (Annexure IV)

294

Annexure XII

Reliance MediaWorks Limited Statement of other income of the Group, as restated (` in lakhs)

Particulars Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Recurring Dividend income from : - Other non-current investments - - - - 10.10 - - Current investments 0.40 0.80 - 132.60 117.30 203.58 0.40 0.80 - 132.60 127.40 203.58 Interest income from: - Bank 514.40 364.90 326.80 496.70 737.30 755.14 - Loans, advance and other deposits 427.80 503.50 211.80 470.40 230.40 2,193.35 942.20 868.40 538.60 967.10 967.70 2,948.49 Gain on sale of current investments 32.10 423.60 274.40 269.20 32.40 1,531.64

Bad debts recovered/ provision written back 45.60 1,405.50 1,080.90 - - - Sundry balances written back (net) - 306.30 - - - - Foreign exchange gain advances, trade receivables and trade payables (net) - - 80.10 1,070.70 - - Miscellaneous income 68.30 119.40 69.70 648.41 762.60 229.00 Non Recurring Gain on derivative contracts (net) - - - - 977.40 2,671.24

Gain on sale of investments / rights therein (long term) 639.20 - - 1,700.00 2,660.30 - Consultation fees - - - 2,130.45 - - Proceeds from keyman insurance policy - - - 266.44 - - Share of advertisement income - - 1,213.00 - - -

Profit on sale of assets / discarding of assets (net) - 2,694.80 - - - - 1,727.80 5,818.80 3,256.70 7,184.90 5,527.80 7,583.95 The above statement should be read with significant accounting policies and notes to summary statements, as restated (Annexure IV) Note

1. The classification of other income by the management into recurring and non-recurring is based on the current operations and business activities of the Company.

295

2. Other income is related / incidental to the business activities of the Company. 3. In accordance with the accounting treatment followed by the Company, exchange fluctuation gain / loss and

profit / loss on sale of assets is disclosed net. Gross amounts in respect thereof are not readily determinable. Hence, net gain where applicable has been considered for the purpose of above disclosure.

296

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Contingent Liabilities

of Parent Company A Central excise Disputed central excise

demand pending with the Central Excise and Service Tax Appellate Tribunal 2,121.50 1,918.40 1,715.30 1,308.60 1,110.90 986.36

B Service tax Disputed service tax

demand pending with the Central Excise and Service Tax Appellate Tribunal 137.20 - - - - -

C Income tax i) Disputed liability in

respect tax deduction at source, matter is pending with Commissioner of Income tax (Appeals) 1,017.10 1,017.10 - - - -

ii)

Disputed tax liability in respect of AY 2008-09 for Rave Entertainment Private Limited (‘REPL’), REPL was wholly owned subsidiary of the Company and merged with it with effect from 1 April 2008. Department’s appeal against order of Commissioner of Income Tax (Appeals) is pending with Income Tax Appellant 1,401.20 1,401.20 - - - -

297

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

Tribunal (ITAT). In Period 2011 the same was pending with Commissioner of Income Tax (Appeals).

Further Company has

received demand in respect of REPL matter for assessment year 2009-10, appeal is pending with Commissioner of Income tax (Appeals) 1,787.20 - - - - -

D Entertainment tax i) In respect of certain

multiplexes, the Company has made an application for availing exemption under the relevant Act retrospectively from the date of commencement of the operations of the said multiplex and the application is pending approval

300.60 219.40 340.00 391.29 357.40 92.97 ii) In respect of certain

multiplexes, the Company is in dispute with the entertainment tax authorities regarding eligibility for availing exemption under the relevant Act. 509.60 558.80 451.70 293.45 219.40 107.39

iii) In respect of demand

orders received for payments of entertainment tax collected and not paid - 113.20 107.50 62.94 56.89 56.89

298

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

to the authorities, the Company has made an appeal against said demand orders as it believes that the same is not payable, being exemption from payment available to it

iv) The Company shall be

liable to pay the entertainment tax in the event that the multiplexes do not continue operations for a period of 10 years from the respective dates from which they commenced their operations 11,505.80 11,125.20 10,614.90 5,747.47 4,404.40 3,302.70

E Claim against

Company not acknowledged as debts 6,297.10 198.60 74.00 74.00 74.00 -

The Company has engaged the services of a Contractor for the purpose of deploying personnel at its cinemas. During the tenure of the contract, the Company has paid the Contractor, amounts payable towards employers

299

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

The Company has engaged the services of a Contractor for the purpose of deploying personnel at its cinemas. During the tenure of the contract, the Company has paid the Contractor, amounts payable towards employers contribution to provident fund (PF) amounting to ` 294.20 lakhs on a regular basis. The Company has learnt that the Contractor has failed to deposit appropriate amounts for employee and employer contributions amounting to approximately ` 588.40 lakhs with the PF authorities and the Company apprehends that some portion of the aforesaid amount which was supposed to be deposited in the individual accounts of the Personnel by the Contractor may have actually been mis-appropriated by the Contractor. The Company has filed a criminal complaint against the Contractor and the matter is currently under investigation. The Company has not received any claims in

300

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 this regard.

F Value Added Tax:

The Maharashtra Value Added Tax Act, 2002 lists the Scheduled entry, interalia, “Copy right” w.e.f. 1.4.2005. Pursuant to this enactment/ scheduled entry, the entertainment industry has made a written representation to the

Finance Minister, Maharashtra for deletion of the scheduled entry from the Act. Similar representation was made by the industry in some other states, as a result of which the Act was modified to delete this scheduled entry. The Company is awaiting a positive response from the Ministry of Finance in respect of the assurance given. Accordingly, no provision (amount not currently ascertainable) has been made in the books of accounts.

301

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

With effect from 1 May 2011 the Maharashtra Value Added Tax Act, 2002 was amended to exempt the on Copyrights for distributon and exhibition of cinematographic films in theatres and cinema halls

G Capital Commitment i) Estimated amount of

contract remaining to be executed on capital account and not provided for net of advances (for fixed 4,478.00 5,269.90 12,248.70 6,386.90 13,599.60 12,714.05 assets)

ii) Estimated amount of contract remaining to be executed on capital account and not provided for net of advances (for investments) 1,200.00 1,200.00 - - - -

iii) Amount of uncalled on

1,500,000 partly paid preference shares of Tree of Knowledge DOT COM Private Limited - - - 300.00 300.00 300.00

H Contingent liabilities of Subsidiary Companies

302

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 i) Disputed Income tax

liability, wherein the Subsidiary has filed an appeal before the first appellate authority - 7.50 7.50 - - -

Octroi / Cess Tax ii)

Disputed Cess Tax Demand pending with Deputy Commissioner, Navi Mumbai Municipal Corporation-Cess Department. The Company believes, being an SEZ unit it is fully exempt from payment of Octroi/Cess Tax as per Maharashtra IT-ITEs policy, 2009. The 536.90 - - - - -

amount of ` 96.56 lakhs deposited, as Tax demand, for the purpose of admission of Appeal is reflected as Short Term Loans and Advances.

iii) Claims against a

subsidiary not acknowledged as debts 121.60 112.00 64.20 - - -

vi) A subsidiary of the Company has received an adverse judgement with regard to a cancelled lease.

The Subsidiary had terminated the lease citing non-delivery of premises by landlord despite assurances for the same.

303

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Landlord had contested

the termination of the lease and filed a case in the District Court.

The District Court gave an adverse judgment against the

Subsidiary and decreed damages of $ 4,870,244.

The Subsidiary filed a revision petition with the District Court and an appeal with the Appellate Court. In both these appeals / revisions the Company was un-successful and the judgment was re-

affirmed in favour of Landlord.

The Subsidiary is confident of the merits of the arguments regarding termination of the lease and would file an appeal with the next level of Appellate Courts.

304

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

In addition to the appeal in the next Appellate Court, the Company has filed a suit against its lawyers who pleaded the case of the Company in the District Court citing wrongful professional conduct and negligence in performance of duties. The Appellate Court in its judgment has specifically highlighted the lack of adequate / appropriate defense during pleading of the matter with the District Court. 2,536.40 2,211.00 - - - -

I Share of Contingent liabilities in the Joint Ventures (‘JV’)

305

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

A Joint Venture had received demand orders for payment of entertainment tax collected and not paid to the authorities aggregating to ` 198.10 lakhs. The Bombay High Court passed an order dated 21 October 2008 in favour of the JV, upholding the exemption of payment from entertainment tax available to the JV and has also directed the State Government to refund the amount of ` 20 lakhs deposited by the JV. The State Government had preferred a special leave petition (‘SLP’) before the Supreme Court of India challenging the said Order and the judgment passed by the Bombay High Court. Based on a legal opinion obtained by the JV, the JV had made a provision aggregating to ` 18.30 lakhs in the books of accounts - - - 89.90 89.90 89.90

306

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

However, the Supreme Court vide its Order dated 27 July 2009, directed the Chief Minister of Maharashtra to realise the amount to the

extent the JV has unjustly enriched itself and pay the same to a voluntary or a charitable organisation. The management of the JV has subsequently paid the entire amount of entertainment tax demanded aggregating to ` 187.30 lakhs

A Joint Venture shall be liable to pay entertainment tax in the event that the Multiplex does not continue operations for the period of ten years from the date of commercial operations 96.90* 96.90* 929.40 926.20 926.20 926.20

As per amendment made by Finance Act 2010, renting of immovable property is defined as a taxable service with retrospective effect from 1 June 2007. Based on a legal opinion obtained by the management joint venture has reversed the unpaid service tax liability. - 16.40 15.90 - - -

307

Annexure XIII

Reliance MediaWorks Limited Statement of contingent liabilities and commitments of the Group

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

Disputed VAT liability of a Joint Venture - 1.80 1.80 - - -

Claims against a Joint 1.10 1.10 1.10 - - -

Venture not acknowledged as debts

* Amount is not currently quantifiable in case of a joint venture

Note:

a) The Group is a party to various legal proceedings in the normal course of business and does not expect the outcome of these proceedings to have any adverse effect on its financial conditions, results of operations or cash flows.

b) The amounts are excluding penalty and interest if any that would be levied at the time of final conclusion.

Other Commitment :- a) Company has issued letter of financial support to some of its wholly owned foreign subsidiaries. b) In view of the loss during the period, the Company has not created Debenture Redemption Reserve in terms

of Section 117 (C) of the Companies Act, 1956. The Company shall create such reserve out of profit, if any in future years.

c) Preference shares shall be redeemed at the end of 20 years from the date of allotment. Each Preference shares shall be redeemed at a premium calculated in a manner that gives the holder an yield of 10% p.a. (till date of redemption) on issue price of ` 1,000 (including premium of ` 995) after deduction of dividend, if declared during the tenure. However, the premium on redemption will be paid only to the original subscribers or to the transferees if the transfers have been previously approved by the Company. In the view of the loss during the period, ` 8.10 lakhs of yield for the current period will be paid as premium at the time of redemption.

The above statement should be read together with significant accounting policies and notes to summary statements, as restated, of the Group (Annexure IV).

308

Annexure XIV

Reliance MediaWorks Limited Statement of accounting ratios based on adjusted profits related to earnings per share, net asset value and return on net worth of the Group (` in lakhs)

Particulars Period 2012 Period 2011 Period 2010 Period 2009

Period 2008 Period 2007

1 Net (loss) /

profit after tax, as restated (after dividend on preference shares (57,267.63) (32,851.45) (12,865.68) (7,875.43) 1,900.24 10,418.41

2 Weighted

average number of Equity Share outstanding during the period for basic earning per share 46,126,170 46,126,170 46,126,170 46,126,170 42,103,935 39,800,750

3 Add - equity

share issuable on conversion of FCCB (Refer note (c) of B of Annexure IV) - 1,694,699 2,061,884 2,061,884 6,084,140 8,387,325

4 Weighted

average number of equity share outstanding during the Period for dilutive earnings per share (Refer note (c) of B of Annexure IV) 46,126,170 47,820,869 48,188,054 48,188,054 48,188,075 48,188,075

5 Number of

equity shares outstanding at the end of the period 46,126,170 46,126,170 46,126,170 46,126,170 46,126,170 39,800,750

309

Annexure XIV

Reliance MediaWorks Limited Statement of accounting ratios based on adjusted profits related to earnings per share, net asset value and return on net worth of the Group (` in lakhs)

Particulars Period 2012 Period 2011 Period 2010 Period 2009

Period 2008 Period 2007

6 Paid up value of each equity share 5.00 5.00 5.00 5.00 5.00 5.00

7 Total paid

capital - equity 2,306.30 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04 8 Reserves and

surplus (net of deficit in statement of profit and loss) (excluding revaluation reserve) (26,411.87) 400.53 33,511.28 46,936.14 65,476.45 33,089.48

9 Net worth

attributable to equity shareholders (7+8) (24,105.57) 2,706.83 35,817.58 49,242.44 67,782.75 35,079.52

Accounting

Ratios a) Earning per

share Basic earning

per share (124.15) (71.22) (27.89) (17.07) 4.51 26.18 Diluted earning

per share (124.15) (71.22) (27.89) (17.07) 3.94 21.62 b) Return of net

worth (refer note 7 below) NA (1,213.65)% (35.92)% (15.99)% 2.80% 29.70%

c)

Net assets value per share (52.26) 106.76 146.95 5.87 77.65 88.14

Note 1 The ratios have been

computed as under :-

310

Basic and diluted earning per

share Net profit / (loss) after tax, as restated, attributable to equity shareholders

Weighted average number of equity share outstanding during the period end

Return on Net worth % Net profit / (loss) after tax, as restated, attributable to equity shareholders

Net worth, as restated, at the end of the period end

Net assets value per share (`) Net worth, as restated, at the end of the period end

Number of equity share outstanding at the end of the year/ period end

2

Restated net profit as appearing in the restated statement of profit and loss and net worth as appearing in summary statement of assets and liabilities, as restated, has been considered for the purpose of computing the above ratios.

3 Calculation of ratios post issue has not been considered. 4 Earnings per share calculations are done in accordance with Accounting Standard 20 "Earning Per Share", notified in

the Companies (Accounting Standards) Rules, 2006. 5 The above statement should be read together with significant accounting policies and notes to summary statements, as

restated (Annexure IV) 6 Dilutive EPS has not been presented in Period 2009, Period 2010 and Period 2011, since it is anti dilutive. 7 8

Return on net worth for the Period 2012 cannot be computed as net worth as on 31 March 2012 is negative. Dividend on preference capital is non-cumulative. In view of the losses during Period 2012, ` 8.10 lakhs being yield for the period will be paid as premium at the time of redemption and shall be adjusted against securities premium reserve. Accordingly, the same is not adjusted for the purpose of calculating the above ratios.

311

Annexure XV

Reliance MediaWorks Limited Statement of principal terms and conditions of long-term borrowings and short-term borrowings of the Group

(` in lakhs) S. No

Particulars As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 1. Commercial Papers / Short Term Loans from Banks (unsecured)

A Templeton Mutual Fund (Refer note 9 of Annexure XV) - 21,984.79 - - - -

B ICICI Prudential (Refer note 9 of Annexure XV) - 9,943.51 - - - -

C Templeton Mutual Fund (Refer note 9 of Annexure XV) - 9,422.16 - - - -

D Yes Bank Limited (Refer note 9 of Annexure XV) - 11,619.63 - - - -

E BNP Paribas (Refer note 9 of Annexure XV) - 4,872.31 - - - -

F LIC MF Savings Plus - - 7,450.18 - - - G LIC MF Income Plus - - 9,832.06 - - - H LIC MF Floating Rate - - 983.21 - - - I LIC MF Savings Plus

d- - 9,808.90 - - -

J J M Financial Mutual d

- - 2,477.40 - - - K J M Financial Mutual

d- - 1,486.43 - - -

L LIC MF Income Plus - - 9,599.87 - - - M LIC MF Savings Plus

d- - 9,599.87 - - -

N IFCI Limited - - 2,466.68 - - - O LIC MF Floating Rate - - 4,744.82 - - - P LIC MF Savings Plus

d- - 4,744.53 - - -

Q LIC MF Income Plus - - 9,489.05 - - - R Yes Bank Limited - - - 14,886.41 - - S IDBI Limited - - - 2,457.18 - - T SIDBI - - - 491.44 - - U Canara Bank - - - 2,456.18 - - V IFCI Limited - - - 4,893.69 - - W LIC MF Floating Rate

d- - - 4,767.92 - -

X LIC MF Income Plus d

- - - 4,767.92 - - Y LIC MF Liquid Fund - - - 4,767.92 - -

312

S. No

Particulars As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Z LIC MF Savings Plus

d- - - 4,767.92 - -

AA LIC MF Special Unit S h

- - - 4,767.92 - - AB UTI Mutual Funds -

li id h l- - - - 1,973.16 -

AC ABN Amro Money l d

- - - - 4,932.89 - AD Lotus India Liquid

d- - - - 1,973.16 -

AE Birla Sun Life Interval Income Fund Quarterly Plan Series II

- - - - 5,297.62

-

AF Kotak Quarterly l l S i

- - - - 2,408.01 - AG Allahabad Bank - - - - 1,965.13 - AH Birla Cash Plus - - - - 4,421.54 - AI United Bank Of India - - - - 3,438.97 - AJ UTI Spread Fund - - - - 2,456.41 - AK Saraswat Co-op Bank

d- - - - 982.42 -

AL SBI Life Insurance Co. d

- - - - 2,456.04 - AM Tata MF - Tata Fixed

Horizon Fund - - - - 3,928.19 -

AN ABN Amro Flexi Short Term Plan - Series B - - - - 2,455.16 -

AO Kotak Mahindra flexi b h

- - - - - 1,972.60 AP Birla Cash Plus - - - - - 9,863.00 AQ Allahabad Bank Loan - - 10,000.00 10,000.00 - - AR Revolving line of

dit f ICICI- - 1,885.19 1,897.28 - -

AS Syndicate Bank Loan - 10,000.00 10,000.00 - - - AT Union Bank of India

L- 10,000.00 10,000.00 - - -

AU Bank of Baroda Loan - - 10,000.00 - - - AV Yes Bank Limited - 3,500.00 - - - - AW DBS Bank Ltd. Loan

(Refer note 9 of Annexure XV)

15,000.00 -

- - -

Sub Total 15,000.00 81,342.40 114,568.19 60,921.78 38,688.70 11,835.60 2. Unsecured Long Term Loan from Bank (including amounts due within the next 1 year)

A Canara Bank Loan** 20,000.00 20,000.00

B DBS Bank Ltd. Loan (Refer note 9 of Annexure XV) 15,000.00

C ICICI Bank Loan, New York Branch - - 2,701.81 6,260.92 - -

20,000.00 35,000.00 2,701.81 6,260.92 -

** - An instalment of ` 12,500.00 lakhs due on 28 March 2012 has been subsequently paid, before the adoption of summary statements by the Board of Directors.

313

3. Secured Short Term Loan From Bank / Other Loans form Bank (including amounts due within the next 1 year)

A Yes Bank Limited (refer note 1 and 4 of Annexure XV) 7,500.00 - - - - -

B Syndicate Bank (Refer note 6 of Annexure XV) - - - 10,000.00 - -

C Bank Asiana – Working Capital Lines (Refer note 12 of Annexure XV)

948.07

- - - - -

Sub Total 8,448.07 - - 10,000.00 - -

4. Secured Long Term Loan From Bank / Other Long Term Loan (including amounts due within the next 1 year)

A Allahabad Bank (Refer note 1 of Annexure XV)*

3,333.33 3,333.33 5,000.00 5,000.00 - -

B Exim Bank (Refer note 1 of Annexure XV)*

4,666.68 4,666.68 7,000.00 7,000.00 - -

C Jammu & Kashmir Bank (Refer note 1 of Annexure XV)*

4,666.68 4,666.68 7,000.00 7,000.00 - -

D Syndicate Bank (Refer note 1 of Annexure XV)*

4,666.68 4,666.68 7,000.00 7,000.00 - -

E Union Bank of India (Refer note 1 of Annexure XV)*

4,000.00 4,000.00 6,000.00 6,000.00 - -

F Vijaya Bank (Refer note 1 of Annexure XV)*

5,333.33 5,333.33 8,000.00 8,000.00 - -

G Rank Investments Private Limited (Refer note 1 of Annexure XV)

- - - - 2,500.00 -

H Barclays Bank Plc (Refer note 1 of Annexure XV)

- - - - 37,500.00 -

I Syndicate Bank (Refer note 6 of Annexure XV)

1,250.00 6,250.00 10,000.00 - - -

314

S. No

Particulars As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 J Syndicate Bank (Refer

note 1 of Annexure XV)

12,187.50 15,000.00 - - - -

K Union Bank of India (Refer note 1 of Annexure XV)

5,600.00 6,000.00 3,500.00 - - -

L Syndicate Bank (Refer note 1 of Annexure XV) 10,000.00

- - - - -

M Non Convertible Debentures (Refer note (Refer note 9 &10 of Annexure XV)

35,000.00 - - - - -

N Axis Bank – Term loan (Refer note 11 of Annexure XV)

4,439.12 5,348.40 3,484.42 - - -

Sub Total 95,143.32 59,265.15 56,984.42 40,000.00 40,000.00 - * - As per agreement dated 28 June 2008 for long term loan obtained from banks, the Company has to comply with covenants with regards to financial parameters, as specified in the agreement. Based on Period 2009, 2010, 2011 and 2012 financials, the Company is not in compliance with the debt covenants.

An instalment of ` 13,333.33 lakhs due on 31 March 2012 has been subsequently paid, before the adoption of summary statements by the Board of Directors.

5. Overdraft facilities / Working Capital Demand Loans from Banks / Car Loan A Cash credit-Bank of

Baroda (Refer note 2 and 4 of Annexure XV)

569.08 540.53 352.63 37.20 293.32 344.08

B Cash Credit – Axis Bank (Refer note 2 and 4 of Annexure XV)

1,603.37 1,959.47 - - - -

C Cash Credit – Axis Bank (Refer note 11 of Annexure XV)

956.98 764.00 533.62 - - -

D Cash Credit - - 99.25 - - -

E Others (Car loan) (Refer note 3 of Annexure XV)

- - - - 0.70 4.04

315

S. No

Particulars As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 F Buyers credit (Refer

note 1, 4,7 and 11 of Annexure XV) 3,920.30 2,965.90 - - - -

Sub Total 7,049.73 6,229.90 985.50 37.20 294.00 348.12 6. Others (Unsecured)

A Zero Coupon FCCB (Refer note 8 of Annexure XV)

- - 15,224.30 14,230.00 13,099.90 46,158.00

B Inter Corporate i

26,605.00 15,000.00 - - 2,046.30 - C Buyers Credit - 318.00 1,392.68 926.80 - - D Others - 187.49 456.80 223.89 290.60 323.47 E Others (long-term) 923.54 798.51 733.40 - - - F NIC Bank – Term loan - - 182.33 - - -

Subtotal 27,528.54 16,304.00 17,989.51 15,380.69 15,436.80 46,481.47 7. Others (Secured) (including amounts due within the next 1 year)

A Equipment loan (refer note 13 of Annexure XV)

350.44 100.40 - - - -

Subtotal 350.44 100.40 - - - - Grand Total 173,520.10 198,241.80 193,229.43 132,600.59 94,419.52 58,665.19 Period 2012

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Allahabad Bank

3,333.33

11.50% per annum ` 1,666.67 Due on 31 March 2012. ` 1,666.67 Due on 31 March 2013

Exim Bank

4,666.68

11.50% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

Jammu & Kashmir Bank

4,666.68

11.50% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

316

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Syndicate Bank

4,666.68

11.50% per annum ` 2,333.34 Due on 31 March 2012. `2,333.34 Due on 31 March 2013

Union Bank of India

4,000.00

11.50% per annum ` 2,000.00 Due on 31 March 2012. ` 2,000.00 Due on 31 March 2013

Vijaya Bank

5,333.33

11.50% per annum ` 2,666.67 Due on 31 March 2012. ` 2,666.67 Due on 31 March 2013

Syndicate Bank 1,250.00

13.25% per annum ` 1,250.00 due on 17 June 2012

Union Bank of India 5,600.00

14.25% per annum ` 400 .00 - 20 equal quarterly instalment starting from 31 March 2012

Syndicate Bank

12,187.50

13.25% per annum ` 937.50 - 16 equal quarterly instalment starting from 14 September 2011

Syndicate Bank

10,000.00

11.75% per annum ` 2,500.00 - 4 equal quarterly instalment starting from 14 September 2013

Canara Bank 12,500.00 12.75% per annum 28 March 2012 7,500.00 12.75% per annum 15 May 2012

Yes Bank Limited 1,500.00 13.00% per annum 31 May 2012 Yes Bank Limited 2,000.00 12.50% per annum 1 May 2012 Yes Bank Limited 1,000.00 12.50% per annum 4 May 2012 Yes Bank Limited 3,000.00 12.50% per annum 22 May 2012 DBS Bank Limited 15,000.00 14.40% per annum 27 April 2012 Buyers Credit 3,920.30 Libor Linked –

iVarious Dates

Inter Corporate Deposit - Magma Fincorp Limited 2,200.00

12.00% per annum 23 Sep 2012

Inter-corporate deposit – Reliance Capital Limited 24,404.92

13.00% per annum Various Dates

317

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Bank of Baroda (cash credit) 569.06 13.50% per annum Repayable on demand Axis Bank (cash credit) 1,603.37 14.00% per annum Repayable on demand Axis Bank (cash credit) 956.96 13.75% per annum Repayable on demand Non Convertible Debentures

35,000.00

11.00% per annum Series 1 – 1 March 2014Series 2 - 1 March 2015 Series 3 - 1 March 2016

Axis Bank – Term loan – RMWSL

4,439.21

13.75% per annum 18 unequal quarterly instalment starting from 31 December 2010

Equipment loan – Lowry

176.59 11.00% per annum repayable in 40 prorated

monthly instalments

Bank Asiana – Working Capital Lines 948.07 6.25% per annum 17 May 2012 HPFS – RMWSL – Equipment Loan 173.85 12.95% per annum Various Dates Inter Corporate Deposit - Divya Shakti Marketing Pvt. Ltd.

19.10 Interest free

Inter Corporate Deposit - Star Screen Cinemas Sdn Bhd 904.47

Interest free

Total 173,520.10 Period 2011

Particulars of Lenders and Instrument Amount outstanding (`̀ in lakhs)

Interest Rate Repayment Schedule

Templeton Mutual Fund 21,984.79 11.75% per annum 15 June 2011 ICICI Prudential Fund 9,943.51 11.15% per annum 20 April 2011 Templeton Mutual Fund 9,422.16 11.75% per annum 12 October 2011 Yes Bank Limited 11,619.63 11.75% per annum 25 November 2011 BNP Paribas Mutual Fund 4,872.31 12.00% per annum 20 June 2011 Allahabad Bank 3,333.33 10.25% per annum ` 1,666.67 Due on

31 March 2012. ` 1,666.67 Due on 31 March 2013

Exim Bank 4,666.68 10.25% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

318

Particulars of Lenders and Instrument Amount outstanding (`̀ in lakhs)

Interest Rate Repayment Schedule

Jammu & Kashmir Bank 4,666.68 10.25% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

Syndicate Bank 4,666.68 10.25% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

Union Bank of India 4,000.00 10.25% per annum ` 2,000.00 Due on 31 March 2012. ` 2,000.00 Due on 31 March 2013

Vijaya Bank 5,333.33 10.25% per annum ` 2,666.67 Due on 31 March 2012. ` 2,666.67 Due on 31 March 2013

Syndicate Bank 6,250.00

12.00% per annum ` 1,250.00 - 8 equal quarterly instalment started from 17 September 2010

Union Bank of India 6,000.00

13.00% per annum ` 400.00 - 20 equal quarterly instalment starting from 31 March 2012

Syndicate Bank 15,000.00

12.00% per annum ` 937.50 - 16 equal quarterly instalment starting from 14 September 2013

Canara Bank 12,500.00 11.50% per annum 28 March 2012 7,500.00 11.50% per annum 15 May 2012

Syndicate Bank 10,000.00 9.00% per annum 27 May 2011 Union Bank of India 10,000.00 10.50% per annum 23 May 2011 Yes Bank Limited 3,500.00 12.50% per annum 27 May 2011 DBS Bank Limited 15,000.00 11.40% per annum 24 January 2012 Buyers credit 3283.90 Libor Linked –

Various Various Dates

Bank of Baroda (cash credit) 540.53 11.00% per annum Repayable on d d

319

Particulars of Lenders and Instrument Amount outstanding (`̀ in lakhs)

Interest Rate Repayment Schedule

Axis Bank (cash credit) 1,959.47 12.75% per annum Repayable on d dAxis Bank – Term loan 5,348.40 13.75% per annum 18 unequal quarterly instalment starting from 31 December 2010

Equipment loan – Others 100.40 11.00% per annum repayable in 40 prorated monthly instalments

Cash Credit – Axis Bank 764.00 12.50% per annum Repayable on demand

Reliance Capital Limited 15,000.00 12.00% per annum Various dates Others 986.00 Interest free Various dates Total 198,241.80 Period 2010

Particulars of Lenders and Instrument Amount outstanding (` in lakhs)

Interest Rate Repayment Schedule

LIC MF Savings Plus 7,450.18 6.60% per annum 10th May 2010 LIC MF Income Plus 9,832.06 5.50% per annum 26th July 2010 LIC MF Floating Rate 983.21 5.50% per annum 26th July 2010 LIC MF Savings Plus Fund 9,808.90 5.50% per annum 11th August 2010 JM Financial Mutual Fund 2,477.40 6.30% per annum 25th May 2010 JM Financial Mutual Fund 1,486.43 6.30% per annum 25th May 2010 LIC MF Income Plus 9,599.87 6.25% per annum 3rd December 2010 LIC MF Savings Plus 9,599.87 6.25% per annum 3rd December 2010 IFCI Ltd. 2,466.68 7.75% per annum 4th June 2010 LIC MF Floating Rate 4,744.82 7.25% per annum 29 December 2010 LIC MF Savings Plus 4,744.53 7.25% per annum 29 December 2010 LIC MF Income Plus 9,489.05 7.25% per annum 29 December 2010 Allahabad Bank 5,000.00 10.75% per annum ` 1,666.67 Due on

31 March 2011. ` 1,666.67 Due on 31 March 2012 ` 1,666.67 Due on 31 March 2013

320

Particulars of Lenders and Instrument Amount outstanding (`̀ in lakhs)

Interest Rate Repayment Schedule

Exim Bank 7,000.00 10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Jammu & Kashmir Bank 7,000.00 10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Syndicate Bank 7,000.00

10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Union Bank of India 6,000.00 10.75% per annum ` 2,000.00 Due on 31 March 2011. ` 2,000.00 Due on 31 March 2012 ` 2,000.00 Due on 31 March 2013

Vijaya Bank 8,000.00 10.75% per annum ` 2,666.67 Due on 31 March 2011. ` 2,666.67 Due on 31 March 2012 ` 2,666.67 Due on 31 March 2013

Syndicate Bank 10,000.00

10.00% per annum ` 1250.00 - 8 equal quarterly instalment starting from 17 September 2010

Union Bank of India 3,500.00

11.00% per annum ` 400 - 20 equal quarterly instalment starting from 31 March 2012

321

Particulars of Lenders and Instrument Amount outstanding (`̀ in lakhs)

Interest Rate Repayment Schedule

Allahabad Bank 10,000.00 7.75% per annum 24 September 2010 Syndicate Bank 10,000.00 7.50% per annum 22 June 2010 Union Bank of India 10,000.00 7.00% per annum 11 June 2010 Bank of Baroda 10,000.00 7.75% per annum 10 July 2010 Buyers Credit 1,392.68 Libor Linked –

Various Various Dates

Zero Coupon FCCB (Refer note 8 of Annexure XV) 15,224.30 - 25 January 2011

Bank of Baroda (cash credit) 352.63 11.00% per annum Repayable on demand

Axis Bank – Term loan 3,484.42 10.75% 18 unequal quarterly instalment starting from 31 December 2010

NIC Bank – Term loan 182.33 12% 16 un-equal quarterly instalments

Cash Credit – Axis Bank 533.62 10.75% Repayable on demand

Cash Credit – NIC Bank 99.25 12.50% Repayable on demand

ICICI Bank 1,885.19 Benchmar k + 0.25% per annum

Within 30 months from date of disbursement

ICICI Bank 2,701.81 Benchmar k + 3.20% per annum

Within 30 months from date of disbursement

Others 1,190.20 Interest free Various dates Total 193,229.43

Period 2009

Particulars of Lenders and Instrument Amount outstanding (` in lakhs)

Interest Rate Repayment Schedule

Yes Bank Limited 14,886.41 9.75% per annum 30 April 2009

322

Particulars of Lenders and Instrument Amount outstanding (`̀ in lakhs)

Interest Rate Repayment Schedule

IDBI Limited 2,457.18 10.00 % per annum 4 June 2009 SIDBI 491.44 10.00 % per annum 4 June 2009 Canara Bank 2,456.18 10.25 % per annum 4 June 2009 IFCI 4,893.69 10.20 % per annum 18 June 2009 LIC MF Floating Rate Fund 4,767.92 10.75 % per annum 14 September 2009 LIC MF Income Plus Fund 4,767.92 10.75 % per annum 14 September 2009 LIC MF Liquid Fund 4,767.92 10.75 % per annum 14 September 2009 LIC MF Savings Plus Fund 4,767.92 10.75% per annum 14 September 2009 LIC MF Special Unit Scheme 4,767.92 10.75% per annum 14 September 2009 Allahabad Bank 5,000.00 10.75% per annum ` 1,666.67 Due on

31 March 2011. ` 1,666.67 Due on 31 March 2012 ` 1,666.67 Due on 31 March 2013

Exim Bank 7,000.00 10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Jammu & Kashmir Bank 7,000.00 10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Syndicate Bank 7,000.00

10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Union Bank of India 6,000.00 10.75% per annum ` 2,000.00 Due on 31 March 2011. ` 2,000.00 Due on 31 March 2012 ` 2,000.00 Due on 31 March 2013

323

Particulars of Lenders and Instrument Amount outstanding (`̀ in lakhs)

Interest Rate Repayment Schedule

Vijaya Bank 8,000.00 10.75% per annum ` 2,666.67 Due on 31 March 2011. ` 2,666.67 Due on 31 March 2012 ` 2,666.67 Due on 31 March 2013

Allahabad Bank 10,000.00 13.50% per annum 8 January 2010 Syndicate Bank 10,000.00 13.50% per annum 31 December 2009 Buyers Credit 926.80 Libor Linked –

Various Various Dates

Zero Coupon FCCB (Refer note 8 of Annexure XV) 14,230.00 - 25 January 2011

ICICI Bank 6,260.92 Benchmar k + 3.20% per annum

Within 30 months from date of disbursement

ICICI Bank 1,897.28 Benchmar k + 0.25% per annum

Within 30 months from date of disbursement

Bank of Baroda (cash credit) 37.20 11.00% per annum Repayable on demand

Others 223.89 Interest free Various dates Total 132,600.59 Period 2008

Particulars of Lenders and Instrument Amount outstanding (`̀ in lakhs)

Interest Rate Repayment Schedule

UTI Mutual Funds - liquid cash plan 1,973.16 10.25% per annum 20 May 2008

ABN Amro Money Plus Fund 4,932.89 10.25% per annum 20 May 2008

Lotus India Liquid Fund 1,973.16 10.25% per annum 20 May 2008

Birla Sunlife Interval Income Fund 5,297.62 10% per annum 20 August 2008 Kotak Quarterly Interval Plan - Series 6 2,408.01 10% per annum 20 August 2008 Allahabad Bank 1,965.13 10.20 % per annum 4 June 2008

324

Particulars of Lenders and Instrument Amount outstanding (`̀ in lakhs)

Interest Rate Repayment Schedule

Birla Cash Plus 4,421.54 10.20 % per annum 4 June 2008

United Bank Of India 3,438.97 10.20 % per annum 4 June 2008

UTI Spread Fund 2,456.41 10.20% per annum 4 June 2008

Saraswat Co-op Bank Ltd. 982.42 10.28% per annum 4 June 2008

SBI Life Insurance Co. Ltd. 2,456.04 10.28% per annum 4 June 2008

Tata MF - Tata Fixed Horizon Fund 3,928.19 10.50% per annum 4 June 2008

ABN Amro Flexible Short Term Plan - Series B 2,455.16 10.50% per annum 4 June 2008

Rank Investments Private Limited 2,500.00 10.75% per annum ` 833.34 Due on 31 March 2011. ` 833.34 Due on 31 March 2012 ` 833.32 Due on 31 March 2013

Barclays Bank PLC 37,500.00 10.75% per annum ` 12,500.00 Due on 31 March 2011. ` 12,500.00 Due on 31 March 2012 ` 12,500.00 Due on 31 March 2013

ICICI (car loan) 0.70 Various rates As per schedule Zero Coupon FCCB (Refer note 8 of Annexure XV) 13,099.90 - January 2011

Inter-corporate deposit – Reliance Capital limited 2,046.30 12.00% per annum Repayable on demand

Bank of Baroda (cash credit) 293.32 11.25% per annum Repayable on d dOthers 290.60 Interest free Various dates

Total 94,419.52 Period 2007

325

Particulars of Lenders and Instrument Amount outstanding (`̀ in lakhs)

Interest Rate Repayment Schedule

Bank of Baroda(cash credit) 344.08 9% per annum Repayable on demand ICICI (Car loan) 4.04 Various rates As per schedule Commercial Paper – Kotak 1,972.60 9.85% per annum 22 August 2007 Commercial Paper – Birla Sunlife 9,863.00 9.85% per annum 22 August 2007 Zero Coupon FCCB (Refer note 8 of Annexure XV)

46,158.00 - January 2011

Others 323.47 Interest free Various dates Total 58,665.19 Commercial Paper:

Details of Terms of Discount rate and repayment schedule of Commercial papers are set out below:

Period 2011

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

Templeton MF (4,500 commercial paper of face value ` 500,000 each dated 28 December 2010 aggregating to ` 22,500 lakhs)

21,984.79 Issued at ` 21,339.08 lakhs, discount rate 11.75 % per annum

15 June 2011

ICICI Prudential Mutual Fund (2,000 commercial paper of face value ` 500,000 each dated 20 January 2011 aggregating to ` 10,000 lakhs)

9,943.51 Issued at ` 9,732.42 lakhs, discount rate 11.15 % per annum

20 April 2011

Templeton MF (2,000 commercial paper of face value ` 500,000 each dated 3February 2011 aggregating to ` 10,000 lakhs)

9,422.16 Issued at ` 9,252.39 lakhs, discount rate 11.75 % per annum

12 October 2011

Yes Bank Ltd (2500 commercial paper of face value ` 500,000 each dated 25 February 2011 aggregating to ` 12,500 lakhs)

11,619.63 Issued at ` 11,490.20 lakhs, discount rate 11.75 % per annum

25 November 2011

BNP Paribas Mutual Fund (1000 commercial paper of face value ` 500,000 each dated 21 March 2011 aggregating to ` 5,000 lakhs)

4,872.31 Issued at ` 4,854.75 lakhs, discount rate 12.00 % per annum

20 June 2011

326

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

Total 57,842.40

327

Period 2010

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

LIC MF Savings Plus (1,500 commercial paper of face value ` 500,000 each dated 3 June 2009 aggregating to ` 7,500 lakhs)

7,450.18 Issued at ` 7,064.41 lakhs, discount rate 6.60 % per annum

10 May 2010

LIC MF Income Plus (2,000 commercial paper of face value ` 500,000 each dated 28 October 2009 aggregating to ` 10,000 lakhs)

9,832.06 Issued at ` 9607.67 lakhs, discount rate 5.50 % per annum

26 July 2010

LIC MF Floating Rate (200 commercial paper of face value ` 500,000 each dated 28 October 2009 aggregating to ` 1,000 lakhs)

983.21 Issued at ` 960.77 lakhs, discount rate 5.50 % per annum

26 July 2010

LIC MF Savings Plus (2,000 commercial paper of face value ` 500,000 each dated 13November 2009 aggregating to ` 10,000 lakhs)

9,808.90 Issued at ` 9607.67 lakhs, discount rate 5.50 % per annum

11 August 2010

J M Financial Mutual Fund (500 commercial paper of face value ` 500,000 each dated 25 November 2009 aggregating to ` 2,500 lakhs)

2,477.40 Issued at ` 2424.26 lakhs, discount rate 6.30 % per annum

25 May 2010

J M Financial Mutual Fund (300 commercial paper of face value ` 500,000 each dated 30 November 2009 aggregating to ` 1,500 lakhs)

1,486.43 Issued at ` 1455.78 lakhs, discount rate 6.30 % per annum

25 May 2010

LIC MF Income Plus (2,000 commercial paper of face value ` 500,000 each dated 29 January 2010 aggregating to ` 10,000 lakhs)

9,599.87 Issued at ` 9499.02 lakhs, discount rate 6.25 % per annum

3 December 2010

LIC MF Savings Plus (2,000 commercial paper of face value ` 500,000 each dated 29 January 2010 aggregating to ` 10,000 lakhs)

9,599.87 Issued at ` 9499.02 lakhs, discount rate 6.25 % per annum

3 December 2010

IFCI Ltd. (2,000 commercial paper of face value ` 500,000 each dated 29 January 2010 aggregating to ` 10,000 lakhs)

2,466.68 Issued at ` 2452.10 lakhs, discount rate 7.75 % per annum

4 June 2010

328

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

LIC MF Floating Rate (1000 commercial paper of face value ` 500,000 each dated 9 March 2010 aggregating to ` 5,000 lakhs)

4,744.82 Issued at ` 4723.24 lakhs, discount rate 7.25 % per annum

29 December 2010

LIC MF Savings Plus (1000 commercial paper of face value ` 500,000 each dated 15 March 2010 aggregating to ` 5,000 lakhs)

4,744.53 Issued at ` 4728.56 lakhs, discount rate 7.25 % per annum

29 December 2010

LIC MF Income Plus (2000 commercial paper of face value ` 500,000 each dated 15 March 2010 aggregating to ` 10,000 lakhs)

9,489.05 Issued at ` 9457.12 lakhs, discount rate 7.25 % per annum

29 December 2010

Total 72,683.00

Period 2009

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

Yes Bank Limited (3,000 commercial paper of face value ` 500,000 each dated 3 February 2009 aggregating to ` 15,000 lakhs)

14,886.41 Issued at ` 14,663.14 lakhs, discount rate 9.75 % per annum

30 April 2009

IDBI Limited (500 commercial paper of face value ` 500,000 each dated 9 March 2009 aggregating to ` 2500 lakhs)

2,457.18 Issued at ` 2,441.80 lakhs, discount rate 10.00 % per annum

4 June 2009

SIDBI (100 commercial paper of face value ` 500,000 each dated 9 March 2009 aggregating to ` 500 lakhs)

491.44 Issued at ` 488.36 lakhs, discount rate 10.00 % per annum

4 June 2009

Canara Bank ( 500 commercial paper of face value ` 500,000 each dated 6 March 2009 aggregating to ` 2,500 lakhs)

2,456.18 Issued at ` 2,438.37 lakhs, discount rate 10.25% per annum

4 June 2009

329

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

IFCI (1,000 commercial paper of face value ` 500,000 each dated 20 March 2009 aggregating to ` 5,000 lakhs)

4,893.69 Issued at ` 4,877.33 lakhs, discount rate 10.20% per annum

18 June 2009

LIC MF Floating Rate Fund (1,000 commercial paper of face value ` 500,000 each dated 17 March 2009 aggregating to ` 5,000 lakhs)

4,767.92 Issued at ` 4746.95 lakhs, discount rate 10.75% per annum

14 September 2009

LIC MF Income Plus Fund (1,000 commercial paper of face value ` 500,000 each dated 17 March 2009 aggregating to ` 5000 lakhs)

4,767.92 Issued at ` 4746.95 lakhs, discount rate 10.75% per annum

14 September 2009

LIC MF Liquid Fund (1,000 commercial paper of face value ` 500,000 each dated 17th March, 2009 aggregating to ` 5,000 lakhs)

4,767.92 Issued at ` 4,746.95 lakhs, discount rate 10.75% per annum

14 September 2009

LIC MF Savings Plus Fund (1,000 commercial paper of face value ` 500,000 each dated 17 March 2009 aggregating to ` 5,000 lakhs)

4,767.92 Issued at ` 4,746.95 lakhs, discount rate 10.75% per annum

14 September 2009

LIC MF Special Unit Scheme (1,000 commercial paper of face value ` 500,000 each dated 17 March 2009 aggregating to ` 5,000 lakhs)

4,767.92 Issued at ` 4,746.95 lakhs, discount rate 10.75% per annum

14 September 2009

Total 49,024.50

330

Period 2008

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

UTI Mutual Funds - liquid cash plan (400 commercial paper of face value ` 500,000 each dated 20 February 2008 aggregating to ` 2,000 lakhs)

1,973.16 Issued at ` 1,950.70 lakhs, discount rate 10.25% per annum

20 May 2008

ABN Amro Money Plus Fund (1,000 commercial paper of face value ` 500,000 each dated 20 February 2008 aggregating to ` 5,000 lakhs)

4,932.89 Issued at ` 4,876.74 lakhs, discount rate 10.25 % per annum

20 May 2008

Religare Mutual Fund* (400 commercial paper of face value ` 500,000 each dated 20 February 2008 aggregating to ` 2,000 lakhs)

1,973.16 Issued at ` 1,950.70 lakhs, discount rate 10.25 % per annum

20 May 2008

Birla Sunlife Interval Income Fund Quarterly Plan Series II (1,100 commercial paper of face value ` 500,000 each dated 20 February 2008 aggregating to ` 5,500 lakhs)

5,297.62 Issued at ` 5,238.78 lakhs, discount rate 10.00% per annum

20 August 2008

Kotak Quarterly Interval Plan - Series 6 (500 commercial paper of face value ` 500,000 each dated 20 February 2008 aggregating to ` 2,500 lakhs)

2,408.01 Issued at ` 2,381.26 lakhs, discount rate 9.20% per annum

20 August 2008

Allahabad Bank (400 commercial paper of face value ` 500,000 each dated 4 March 2008 aggregating to ` 2,000 lakhs)

1,965.13 Issued at ` 1,949.87 lakhs, discount rate 10.20% per annum

4 June 2008

Birla Cash Plus (900 commercial paper of face value ` 500,000 each dated 4 March 2008 aggregating to ` 4,500 lakhs)

4,421.54 Issued at ` 4,387.21 lakhs, discount rate 10.20% per annum

4 June 2008

United Bank Of India (700 commercial paper of face value ` 500,000 each dated 4 March 2008 aggregating to ` 3,500 lakhs)

3,438.97 Issued at ` 3,412.27 lakhs, discount rate 10.20% per annum

4 June 2008

331

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

UTI Spread Fund (500 commercial paper of face value ` 500,000 each dated 4 March 2008 aggregating to ` 2,500 lakhs)

2,456.41 Issued at ` 2,437.34 lakhs, discount rate 10.20% per annum

4 June 2008

Saraswat Co-op Bank Ltd. (200 commercial paper of face value ` 500,000 each dated 7 March 2008 aggregating to ` 1,000 lakhs)

982.42 Issued at ` 975.55 lakhs, discount rate 10.28% per annum

4 June 2008

SBI Life Insurance Co. Ltd. (500 commercial paper of face value ` 500,000 each dated 7 March 2008 aggregating to ` 2,500 lakhs)

2,456.04 Issued at ` 2,438.87 lakhs, discount rate 10.28% per annum

4 June 2008

Tata MF - Tata Fixed Horizon Fund (800 commercial paper of face value ` 500,000 each dated 7 March 2008 aggregating to ` 4,000 lakhs)

3,928.19 Issued at ` 3,900.14 lakhs, discount rate 10.50% per annum

4 June 2008

ABN Amro Flexible Short Term Plan - Series B (500 commercial paper of face value ` 500,000 each dated 7 March 2008 aggregating to ` 2,500 lakhs)

2,455.16 Issued at ` 2,437.59 lakhs, discount rate 10.50% per annum

4 June 2008

Total 38,688.70

332

Period 2007

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

Kotak Mahindra flexi Debt Scheme (400 commercial paper of face value ` 500,000 each dated 24 May 2007 aggregating to ` 2,000 lakhs)

1,972.60 Issued at ` 1,952.60 lakhs, discount rate 9.85 % per annum

22 August 2007

Birla Cash Plus (2,000 commercial paper of face value ` 500,000 each dated 24 May 2007 aggregating to ` 10,000 lakhs)

9,863.00 Issued at ` 9,762.88 lakhs, discount rate 9.85 % per annum

22 August 2007

Total 11,835.60

* Religare Mutual Fund is Formerly known as Lotus India Mutual Fund

Notes:

Note 1: Secured by first pari passu charge on all fixed assets of the Parent Company.

Note 2: Cash credit is secured by deferred payment note, hypothecation of book-debts, moveable fixed assets and stocks of chemicals.

Note 3: Secured against the motor cars acquired on Equitable Monthly Instalment (EMI) System.

Note 4: Secured by pari passu first charge on the inventories, book debts and other current assets of the Company.

Note 5: Secured by pari passu second charge of all the movable fixed assets and pari passu first charge on current assets of the Company.

Note 6: Secured by pari passu first charge on goods, stocks, raw material finished goods, unfinished goods, book debts and loans and advances of the Company

Note 7: Secured by pari passu second charge on current assets and the moveable fixed assets of the Company.

Note 8: As per the terms of the issue document, the bonds were redeemable, in whole but not in part at the option of the Company at any time on or after 25 January 2009 and on or prior to 26 January 2011 subject to certain conditions at 121.679 per cent of the principal amount. During the current year the balance outstanding bonds were redeemed.

Note 9: These loans have been guaranteed by Reliance Capital Limited.

Note 10 : Secured by first pari passu charge on the all assets of the Parent Company and its Wholly owned Indian subsidiaries.

Note 11 : Secured by pari passu first charge of all the fixed assets, inventories, book debts and loans of advances of subsidiary.

333

Note 12 : Secured by Standby Letter of credit issued by Parent Company for availing facility by subsidiary company in foreign.

Note 13 : Secured by the hypothecation of fixed assets purchased.

334

Annexure XVI

Reliance MediaWorks Limited

(` in lakhs) Statement of capitalisation of the Group Pre-issue Post-issue As at

Particulars 31 March 2012 As Adjusted for Issue*

Borrowings:

Short term borrowings 57,102.80 Long term borrowings (including ` 54,566.70 current maturities) 116,417.30 Total borrowings 173,520.10 - Shareholder's fund:

Share capital 2,453.80

Reserves and surplus (net) (excluding revaluation reserves) (26,411.87) Less: Miscellaneous expenditures not written off - Total shareholder's fund (23,958.07) -

Long term debt / Shareholder’s fund NA Notes : - a) Short term borrowing represents amount repayable within one year from 31 March 2012

b) The figures disclosed above are based on the summary statement of assets and liabilities, as restated, of the Company as at 31 March 2012

c) The corresponding post issue figures are not determinable at this stage pending the completion of the Rights issue process and hence have not been furnished.

335

Annexure XVII

Reliance MediaWorks Limited

Statement of the dividend paid / proposed

(` in lakhs)

Class of shares

Face Value of share in

`̀

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Equity shares Equity shares capital as at year end / period end 5

2,306.30

2,306.30

2,306.30 2,306.30 2,306.30 1,990.04

Total 2,306.30 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04

Final dividend

Rate of the final dividend (excluding dividend distribution tax) - - - - 50.00% 50.00%

Aggregating amount of final dividend - - - - 1,153.20 995.02

336

Annexure XVIII

Reliance MediaWorks Limited Statement of related party disclosures of the Group

(` in lakhs) Parties where control exists Holding Company

Reliance Capital Limited (up to 30 November 2007) Reliance Land Private Limited (up to 30 November 2007)

Other related parties with whom transactions have taken place during the period

(a) Significant shareholders, key managerial personnel and their relatives Manmohan Shetty (up to 30 November 2007) Pooja Shetty (up to 30 November 2007) Kirti Desai – Manager appointed u/s 269 of the Companies Act, 1956 (with effect from 30 January 2008 till

15 May 2011) Madhulika Singh – Manager appointed u/s 269 of the Companies Act, 1956 (with effect from 28 May 2011

upto 30 June 2011) Ashish R Agarwal – Manager appointed u/s 269 of the Companies Act, 1956 (with effect from 1 July 2011) Reliance Land Private Limited (upto 30 November 2007)

(b) Enterprises over which company / key managerial personnel has significant influence / Associates

HPE / Adlabs LP. Sultan Production Private Limited (up to 31 March 2009) Gold Adlabs Dharma Production Private Limited (up to 30 November 2007) Idream Productions Private Limited (up to 30 November 2007) Whistling Woods International Private Limited (up to 30 November 2007) Reliance Communication Infrastructure Limited (up to 30 November 2007) Reliance Capital Assets Management Limited (up to 30 November 2007) Reliance Web Stores Limited (up to 30 November 2007) Reliance General Insurance Company Limited (up to 30 November 2007) M/s. Shringar Films (upto 30 November 2007) South Yarra Holding (upto 30 November 2007) Shringar Films Limited (upto 30 November 2007) Adlabs Shringar Multiplex Cinemas Private Limited (upto 30 November 2007)

(c) Fellow Subsidiary

Reliance Broadcast Network Limited (upto 31 March 2007)

337

(d) Joint ventures

Cineplex Private Limited (upto 3 June 2011) Swanston Multiplex Cinemas Private Limited Divyashakti Marketing Private Limited Adlabs Multiplex Limited (upto 19 December 2007)

Nature of Transactions

Name of Related Party Holding Company Period 2012

Period 2011 Period 2010

Period 2009

Period 2008

Period 2007

Rendering of services Reliance Capital Limited - - - - - 31.43

Dividend Paid

Reliance Land Private Limited - - - - 515.00 463.50 Reliance Capital Limited - - - - 31.38 28.24

Nature of Transactions

Name of Related Party Significant Shareholders, key managerial personnel and their relatives

Period 2012

Period 2011 Period 2010

Period 2009

Period 2008

Period 2007

Dividend Paid Manmohan Shetty - - - 57.30 186.56

Managerial Remuneration

Kirti Desai 5.60 10.80 7.80 7.80 1.40 - Madhulika Singh 0.80 - - - - - Ashish R. Agarwal 17.50 - - - - - Manmohan Shetty - - - - 116.10 75.90 Pooja Shetty - - - - 4.90 37.95

Loans given Kirti Desai - - 5.00 - - - Loans received back Kirti Desai - - 5.00 - - - Premium on Key managerial policy Manmohan Shetty - - - - - 48.06

Nature of Transactions

Name of Related Party Fellow Subsidiaries Period 2012

Period 2011 Period 2010

Period 2009

Period 2008

Period 2007

Interest Income

Reliance Broadcast Network Limited - - - - - 2,086.88

Loan given Reliance Broadcast Network Limited - - - - - 25,423.84

Loan Received back

Reliance Broadcast Network Limited - - - - - 5,800.00

338

Nature of Transactions

Name of Related Party

Enterprises over which Company has significant influence / associates Period 2012

Period 2011 Period 2010

Period 2009

Period 2008

Period 2007

Reimbursement of expenses

Sultan Production Private Limited - - - (107.70) - -

Income from theatre operation Gold Adlabs 116.10 121.60 151.30 252.08 292.22 197.61

(Withdrawal) / additional contribution Gold Adlabs (129.00) (105.80) (130.l0) (278.31) (301.61) (237.11) Investment / Purchase of shares HPE / Adlabs LP - - - - - 4,607.75 Interest Income HPE / Adlabs LP - - - - 43.70 147.08 Repayment of Principal by Limited liability Partnership HPE / Adlabs LP - - 241.70 - - -

Loan Given Sultan Production Private Limited - - - 548.30 719.20 -

Outstanding Balances as at period end

Sultan Production Private Limited - - - 1,159.70 719.20 -

Nature of Transactions

Name of Related Party

Enterprises over which Key Managerial personnel have significant influence

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Receiving of Services

Reliance General Insurance Company Limited - - - - - 136.16

Rendering of services

Dharma Production Private Limited - - - - - 111.26 Idream Productions Private Limited - - - - - 2.10 Whistling Woods International Private Limited - - - - - 4.21 Reliance Capital Assets Management Limited - - - - - 5.95 Reliance Web Stores Limited - - - - - 0.14 Reliance Communication Infrastructure Limited - - - - - 191.75

Outstanding Balances as at period end

Idream Production Private Limited - - - - - 0.79 Dharma Production Private Limited - - - - - 0.06 Reliance Communication Infrastructure Limited - - - - - 0.35

339

Nature of Transactions

Name of Related Party

Enterprises over which Key Managerial personnel have significant influence

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Whistling Wood International Private Limited - - - - - 0.38

Nature of Transactions

Name of Related Party

Other related parties Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Adlabs Shringar Multiplex Cinemas Private Limited - - - - - 179.73

Shringar Cinemas Limited - - - - - 43.80

Other expenses paid Others 23.99 Reimbursement of expenses

Shringar Cinemas Limited - - - - - 9.92

Outstanding balances as at period end

Shringar Cinemas Limited - - - - - (6.34) Whistling Wood International Private Limited - - - - - 0.01

340

Annexure XIX Reliance MediaWorks Limited

Segment information of the Group (` in lakhs)

Particulars Film production services

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Revenue Operating revenue 20,314.70 24,726.90 16,060.40 13,498.00 6,647.70 10,463.30 Other income - 416.30 409.80 - 49.70 55.10 Net revenue 20,314.70 25,143.20 16,470.20 13,498.00 6,697.40 10,518.40

Internal segment sales (462.80) (1,877.70) (705.90) (441.00) (376.50)

(921.63) Total segment revenue 19,851.90 23,265.50 15,764.30 13,057.00 6,320.90 9,596.77 Result ((loss) / profit before interest and corporate expenses)

Segment result (5,653.94) (477.60) 3,067.42 3,538.96 2,306.70 3,464.17

Other Information Segment assets 75,285.05 75,073.22 58,167.72 29,764.20 15,425.76 8,108.86 Segment liabilities 6,005.00 5,268.80 4,656.80 1,577.50 3,186.70 1,754.70 Capital expenditure 3,786.50 16,464.20 23,533.80 4,810.90 7,514.61 2,650.50 Depreciation, amortisation and impairment 6,127.34 4,870.00 2,189.28 1,049.84 330.50 398.43

341

Particulars Theatrical exhibition

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Revenue

Operating revenue 55,515.40 51,424.60 47,620.80 34,169.84 12,238.64 11,229.00 Other income 42.00 3,300.40 14.80 - 330.30 132.24 Net revenue 55,557.40 54,725.00 47,635.60 34,169.84 12,568.94 11,361.24 Internal segment sales (12.80) (46.70) (910.80) (998.70) - - Total segment revenue 55,544.60 54,678.30 46,724.80 33,171.14 12,568.94 11,361.20 Result ((loss) / profit before interest and corporate expenses)

Segment result (18,522.45) (10,398.60) (4,953.70) (4,545.60) 684.90 722.50 Other Information

Segment assets 97,971.82 108,259.33 121,947.33 108,036.63 55,514.41 24,302.11

Segment liabilities 23,533.90 15,772.40 13,197.00 10,908.40 5,575.30 2,459.10

Capital expenditure 2,488.60 5,860.10 18,905.70 36,854.70 16,980.33 7,164.50 Depreciation and amortisation and impairment 7,875.70 8,241.80 7,140.70 3,509.60 1,152.00 1,224.32

342

Particulars Television / Film Production and Distribution

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Revenue

Operating revenue 6,244.40 5,334.00 10,411.00 21,164.80 13,907.90 14,770.80 Other income 3.56 690.20 656.30 - 332.10 28.96 Net revenue 6,247.96 6,024.20 11,067.30 21,164.80 14,240.00 14,799.76 Internal segment sales - (353.70) (968.30) (1,457.60) (1,648.80) - Total segment revenue 6,247.96 5,670.50 10,099.00 19,707.20 12,591.20 14,799.80 Result ((loss) / profit before interest and corporate expenses)

Segment result 1,147.63 1,150.00 4,011.00 3,187.33 (148.32) 1,916.17

Other Information

Segment assets 13,280.56 10,528.86 16,325.56 16,882.06 41,849.73 32,648.23

Segment liabilities 2,308.60 2,417.70 2,178.20 1,420.70 7,974.30 4,406.60

Capital expenditure 23.10 19.20 483.20 - 7,512.90 21,774.80 Depreciation and amortisation and impairment 26.30 49.00 280.00 8,915.87 8,647.50 7,816.23

343

Particulars Radio

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Other Information Segment assets - - - - 45,061.80 - Segment liabilities - - - - 7,021.90 - Capital expenditure - - - - 19,195.02 -

Particulars Total

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Revenue

Operating revenue 82,074.50 81,485.50 74,092.20 68,832.64 32,794.24 36,463.10 Other income 45.56 4,406.90 1,080.90 - 712.10 216.30 Net revenue 82,120.06 85,892.40 75,173.10 68,832.64 33,506.34 36,679.40 Internal segment sales (475.60) (2,278.10) (2,585.00) (2,897.30) (2,025.30) (921.63) Total segment revenue 81,644.46 83,614.30 72,588.10 65,935.34 31,481.04 35,757.77 Unallocated revenue 1,828.24 1,411.90 2,175.80 7,184.90 4,815.70 7,367.65 Total Revenue 83,472.70 85,026.20 74,763.90 73,120.24 36,296.74 43,125.42 Result ((loss) / profit before interest and corporate expenses)

Segment result (23,028.76) (9,726.20) 2,124.72 2,180.69 2,843.28 6,102.84 Unallocated corporate income 1,828.24 1,411.90 2,175.80 7,184.90 4,815.70 7,367.65 Unallocated corporate expenses (7,122.53) (6,598.56) (5,864.41) (3,860.56) (1,827.61) (1,572.44) (Loss) / profit before interest and tax (28,323.05) (14,912.86) (1,563.89) 5,505.03 5,831.37 11,898.05 Interest and finance charges (net (28,505.17) (17,514.20) (11,717.20) (12,447.20) (2,905.24) (618.06) Income tax (including deferred tax and fringe benefit tax) 12.69 (566.59) (52.86) (517.17) (858.01) (794.82) Minority interest (401.10) 196.70 530.87 322.12 (53.80) (66.76) (Loss) / profit for the period (57,216.63) (32,796.95) (12,803.08) (7,137.22) 2,014.32 10,418.41 Other Information

Segment assets 186,537.43 193,861.41 196,440.61 154,682.89 157,851.70 65,059.20 Unallocated corporate assets 23,883.48 34,913.25 56,315.00 49,131.99 29,425.71 51,236.93

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Particulars Total

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

Total assets 210,420.91 228,774.66 252,755.61 203,814.88 187,277.41 116,296.13 Segment liabilities 31,847.50 23,458.90 20,032.00 13,906.60 23,758.20 8,620.40 Unallocated corporate liabilities 202,531.48 202,608.93 196,906.03 140,665.84 95,736.46 72,596.21 Total liabilities 234,378.98 226,067.83 216,938.03 154,572.44 119,494.66 81,216.61

Capital expenditure 6,298.20 22,343.50 42,922.70 41,665.60 51,202.86 31,589.80 Unallocated corporate capital expenditure 51.90 58.70 168.60 186.30 74.28 151.00 Total capital expenditure 6,350.10 22,402.20 43,091.30 41,851.90 51,277.14 31,740.80 Depreciation and amortisation and impairment 14,029.34 13,160.80 9,609.98 13,475.31 10,130.00 9,438.98 Unallocated depreciation and amortisation and impairment 129.76 65.70 119.46 67.10 23.62 11.24 Total depreciation and amortisation and impairment 14,159.10 13,226.50 9,729.44 13,542.41 10,153.62 9,450.22

India

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Segment Revenue 59,280.66 60,277.90 50,012.80 52,324.04 31,292.64 Segment Assets 179,652.31 200,866.76 227,050.71 178,966.78 186,167.11 Capital Expenditure 4,485.79 18,941.70 34,344.70 22,584.80 51,276.64 Americas

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Segment Revenue 13,343.60 16,234.10 15,679.80 11,540.00 120.00 Segment Assets 13,834.80 14,093.80 13,294.80 12,385.10 654.40 Capital Expenditure 720.43 2,325.60 5,269.80 9,101.00 0.50 Malaysia

Period 2012 Period 2011 Period 2010 Period 2009 Segment Revenue 6,317.60 5,615.70 4,970.80 1,491.10 Segment Assets 12,693.70 10,323.60 10,892.10 12,197.90 Capital Expenditure 405.93 617.50 1,702.50 10,081.00

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Others

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Segment Revenue 2,702.60 1,486.60 1,924.70 580.20 68.40 Segment Assets 5,240.10 3,490.50 1,518.00 265.10 455.90 Capital Expenditure 737.95 517.40 1,774.30 85.10 - Total

Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Segment Revenue 81,644.46 83,614.30 72,588.10 65,935.34 31,481.04 Segment Assets 210,420.91 228,774.66 252,755.61 203,814.88 187,277.41 Capital Expenditure 6,350.10 22,402.20 43,091.30 41,851.90 51,277.14 The Group has disclosed Business Segment as the primary segment. The business of the Group is divided into three segments - Film production services, Theatrical exhibition and Television / Film production and distribution. Segments have been identified taking into account the nature of the business, the differing risks and returns, the organisation structure and internal reporting system. Film production services operation primarily comprise of processing of raw exposed films, colour correction, editing, digital processing, equipment / facility rental, copying and printing of positive exhibitions prints and trading in raw film rolls. Theatrical exhibition operations comprise of single screen, multiplex / Imax cinema exhibition, range of activities / services offered at cinema centres including catering food and beverages. Television / film production and distribution comprises of production of television / film content which is produced / coproduced by the Group and includes related services of financing for production of films. Film distribution operation comprises of the Group’s share of revenue from exploitation of distribution rights acquired by the Group, which may include as a package, theatrical rights and video and television rights. Segment revenue, segment results, segment assets and segment liabilities include the respective amounts identifiable to each segment as also the amounts allocable on a reasonable basis. Income and expenses which are not directly attributable to any business segment are shown as unallocated corporate income / expenses. Assets and liabilities that cannot be allocated between the segments are shown as a part of unallocated corporate assets and liabilities respectively. Further, the Group has considered the overseas operations as a separately identifiable geographic segment due to substantial operations in the United States of America and Malaysia. Hence, the Group has identified secondary segments based on geographic locations and has reported India, Americas, Malaysia and Rest of world as geographic segments. Pursuant to the business restructuring exercise of Film production services, with effect from 1 October 2011, animation business is no longer considered to be a part of this segment.

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The Board of Directors Reliance MediaWorks Limited Film City Complex Goregaon (East) MUMBAI 400 065 25 July 2012

Dear Sirs

1 We have examined the attached restated summary financial information of Reliance MediaWorks Limited (‘RMWL’ or ‘the Company’), as approved by the Board of Directors of the Company, prepared in terms of the requirements of Paragraph B, Part II of Schedule II to the Companies Act, 1956 ('the Act'), the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2009, as amended to date, to the extent applicable (‘SEBI Regulations’), the Guidance note on ‘Reports in Company Prospectus (Revised)’ issued by the Institute of Chartered Accountants of India (‘ICAI’), to the extent applicable (‘Guidance Note’), and in terms of our engagement agreed upon with you in accordance with our engagement letter dated 11 July 2012 in connection with the proposed Issue of Equity Shares of the Company on a rights basis.

2 We have examined the attached Summary Statement of Assets and Liabilities, as restated, of the Company as at 31 March 2012, 31 March 2011, 31 March 2010, 31 March 2009, 31 March 2008 and 30 June 2007, the attached Summary Statement of Profit and Loss, as restated, for the twelve months ended 31 March 2012, year ended 31 March 2011, year ended 31 March 2010, year ended 31 March 2009, nine months ended 31 March 2008 and fifteen months ended 30 June 2007, and the attached Summary Statement of Cash Flow, as restated, for the twelve months ended 31 March 2012, for the year ended 31 March 2011, year ended 31 March 2010, year ended 31 March 2009, nine months ended 31 March 2008 and fifteen months ended 30 June 2007, as set out in Annexure I, Annexure II and Annexure III respectively, together referred to hereinafter as the ‘Restated Summary Statements’. These restated summary statements of RMWL have been prepared by the management from the audited condensed financial statements for the twelve months ended 31 March 2012 and from the audited financial statements for the year ended 31 March 2011, year ended 31 March 2010, year ended 31 March 2009, nine months ended 31 March 2008 and fifteen months ended 30 June 2007, being the last six financial years / periods for which the accounts of the Company have been made up, and have been approved by the Board of Directors for the respective years / periods and adopted by the Members of the Company, except the financial statements for the twelve months ended 31 March 2012 which have been approved only by the Board of Directors of the Company. The financial statements of the Company as at and for the year ended 31 March 2009, nine months ended 31 March 2008 and fifteen month ended 30 June 2007 have been audited by one of the joint auditors, B S R & Co., Chartered Accountants. The condensed financial statements as at and for the twelve months ended 31 March 2012 and the financial statements as at and for the year ended 31 March 2011 and year ended 31 March 2010 have been audited by us. The restated summary statements have been prepared in line with General Circular No. 62/2011 F No. 17/244/2011-CL-V, dated 05.09.2011 issued by Ministry of Corporate Affairs, Government of India.

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3 Without qualifying our report, we draw attention to the following

a) As set out in paragraph (a) of Note D of Annexure IV to this report, the Company’s net worth is eroded (restated) and the Company has incurred a loss of ` 45,850.80 lakh (as restated) for the twelve months period 1 April 2011 to 31 March 2012, indicating the existence of uncertainty that may cast doubt about the Company’s ability to continue as a going concern. Considering the matters set out in the said note, this Restated Summary Statement is prepared on a going concern basis.

b) As set out in paragraph (f) (i) of Note D of Annexure IV to this report, during the fifteen months ended 30 June 2007, the Ho’ble High Court of Judicature at Bombay vide its order dated 15 September 2006 sanctioned the Composite Scheme of Amalgamation and Arrangement (‘the Scheme’) between the Company, Entertainment One India Limited (‘E-ONE’), Mukta Adlabs Digital Exhibition Private Limited (‘MADEL’) (name subsequently changed to Adlabs Multiplex and Theatres Limited), Reliance Unicom Limited (‘RUL’) (name subsequently changed to Reliance Broadcast Network Limited) and their respective shareholders and creditors. The Composite Scheme inter-alia provided for the amalgamation of EONE and merger of the digital business of the MADEL with the Company with effect from 1 April 2005 and the demerger of the radio business to RUL effective 31 March 2006.

As represented by the Company’s management, an application to the Ministry of Information and Broadcasting for vesting of radio licenses held by it in the name of RUL was made. Pending the said approval, the Composite Scheme had not been filed with the Registrar of Companies (‘ROC’) as required under Section 391(3) of the Companies Act, 1956. However, pursuant to representations by the management that it is reasonably certain that the Composite Scheme will be filed with the ROC in due course, for the purpose of the financial statements for the fifteen months ended 30 June 2007, pending completion of licensing and other procedural formalities, the Composite Scheme had been given effect to by the Company’s management in view of the Court approval and to give effect to the substance of the Composite Scheme as approved by the Ho’ble High Court of Judicature at Bombay. Pending completion of licensing and other procedural formalities, the Composite Scheme was eventually not filed with the Registrar of Companies (‘ROC’) as required under Section 391(3) of the Act.

Additionally, as set out in paragraph (e)(i) of Note D of Annexure IV, during the nine months period ended 31 March 2008, the Hon’ble High Court of Judicature at Bombay vide its order dated 7 March 2008 sanctioned the Modified Composite Scheme of Amalgamation and Arrangement (‘Modified Scheme’) for modification of the Composite Scheme. The Modified Scheme was filed with the ROC on 31 March 2008. The Modified Scheme inter-alia provides that the net results of the transactions related to the radio business of the Company for the period from 31 March 2006 to the Effective Date (i.e. the date of filing the Modified Scheme with the ROC, 31 March 2008) be adjusted in the General reserve account of the Company. The Composite Scheme was given effect to in accordance with the accounting treatment prescribed by the said Scheme in the financial statements for the fifteen months ended 30 June 2007 and, only the modifications to the original scheme were given effect to in the financial statements for the nine months ended 31 March 2008.

348

c) As set out in paragraph (d)(ii) of Note D and point 2 of paragraph IV of Note E of Annexure IV, during the year ended 31 March 2009, the Hon’ble High Court of Judicature at Mumbai vide its order dated 8 May 2009 sanctioned the Scheme of Amalgamation of the Company with its wholly owned subsidiaries Adlabs Multiplex and Theatres Limited, Adlabs Multiplex Limited, Rave Entertainment Private Limited and Mahimna Entertainment Private Limited (‘Amalgamation Scheme’), under sections 391 to 394 of the Act. Pursuant to the said Amalgamation Scheme, the Company has recorded an increase in value of assets aggregating ` 17,890.10 lakhs by crediting the Capital reserve. Further, the Company has recorded an adjustment for diminution in value of its assets (production and distribution rights, fixed assets, investments, debtors and loans and advances) aggregating ` 15,669.60 lakhs by debiting the same to Capital reserve instead of the profit and loss account, had the Company debited the profit and loss account, the loss before tax for the year would be higher by the said amount.

4 In accordance with the requirements of Paragraph B, Part II of Schedule II of the Act, the SEBI Regulations, the Guidance Note and in accordance with the terms of our engagement agreed with you, and read with paragraphs 2 above and with regards to adjustments for matters of emphasis in the Auditors’ report as stated in paragraph 3 above, we confirm/ further report that the Restated Summary Statements examined by us and as set out in Annexure I, Annexure II and Annexure III to this report are prepared after making adjustments and regrouping as in our opinion were appropriate and as are more fully described in significant accounting policies and notes to the Restated Summary Statements enclosed as Annexure IV to this report.

5 Based on the above, read with the matters stated in paragraphs 2 above and with regards to adjustments for matters of emphasis in the Auditors’ report as stated in paragraph 3 above , we are of the opinion that the restated financial information have been made after incorporating:

i. Adjustments for the changes in accounting policies adopted by the Company retrospectively in respective financial years/ periods to reflect the same accounting treatment as per changed accounting policy for all the reporting periods;

ii. Adjustments for material amounts in the respective financial years / periods to which they relate; and

iii. There are no extraordinary items that need to be disclosed separately in the Restated Summary Statements.

iv. Adjustments for qualifications, as applicable in the Auditors’ reports in the respective years/ periods to which they relate.

6 We have also examined the following other restated financial information set out in the Annexures prepared by the management and approved by the Board of Directors, relating to the Restated Summary Statements and annexed to this report:

p) Statement of share capital, enclosed as Annexure V q) Summary statement of reserves and surplus, enclosed as Annexure VI r) Statement of non-current investment, deferred tax assets (net), long-term loans and advances and

other non-current assets, enclosed as Annexure VII s) Statement of current assets, enclosed as Annexure VIII t) Statement of non-current liabilities, enclosed as Annexure IX u) Statement of current liabilities, enclosed as Annexure X v) Statement of revenue, enclosed as Annexure XI w) Statement of other income, enclosed as Annexure XII x) Statement of contingent liabilities and commitments, enclosed as Annexure XIII

349

y) Statement of accounting ratios, enclosed as Annexure XIV z) Statement of principal terms and conditions of long-term borrowings and short-term borrowings,

enclosed as Annexure XV aa) Statement of capitalization as at 31 March 2012, enclosed as Annexure XVI bb) Statement of dividend paid/ proposed, enclosed as Annexure XVII cc) Statement of related party disclosures, enclosed as Annexure XVIII dd) Statement of tax shelter, enclosed as Annexure XIX

7 In our opinion, the Restated Summary Statements contained in Annexure I, Annexure II and Annexure III to this report, read with the significant accounting policies and notes disclosed in Annexure IV, and other restated financial information contained in Annexure V to Annexure XIX to this report, and read with paragraphs 2 and 3 above and note 3 disclosed in Annexure VII and Annexure VIII respectively, have been prepared in accordance with Paragraph B, Part II of Schedule II of the Act and the SEBI Regulations.

8 The report should not in any way be construed as a reissuance or redating of any of the previous audit reports issued by us or by the other firm of Chartered Accountants, nor should this report be construed as a new opinion on any financial statements referred to herein.

9 We have no responsibility to update our report for events and circumstances occurring after the date of this report.

10 This report is intended solely for use of the management and for inclusion in the Offer Document in connection with the proposed issue of equity shares of the Company on a rights basis, and is not to be used, referred to or distributed for any other purpose without our prior written consent.

For B S R & Co. Chartered Accountants Firm’s Registration No: 101248W

For Chaturvedi & Shah Chartered Accountants

Firm’s Registration No: 101720W

Bhavesh Dhupelia Partner Membership No: 042070 Mumbai 25 July 2012

Parag D. Mehta Partner

Membership No: 113904 Mumbai

25 July 2012

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Annexure I

Reliance MediaWorks Limited

Summary statement of assets and liabilities of the Company, as restated (` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Assets A Non-current assets I Fixed assets (i) Tangible assets 79,115.33 85,631.03 84,424.23 66,359.33 34,799.90 13,964.70 (ii) Intangible assets 642.40 418.10 184.60 219.00 18,206.10 4,140.70 (iii) Capital work-in-

progress 12,599.70 13,812.70 16,132.50 16,863.20 21,331.01 14,931.11 (iv) Intangible assets

under development - - - - - - II Non-current investments 18,102.14 7,268.30 5,349.40 2,334.50 10,919.45 8,145.48 III Deferred tax assets (net) - - - - - - IV Long-term loans and

advances 24,161.30 27,325.70 25,648.86 23,869.54 28,957.13 8,783.64 V Other non-current assets 52.07 290.30 277.42 59.41 43.75 5,117.75 134,672.94 134,746.13 132,017.01 109,704.98 114,257.34 55,083.38 B Current assets I Current investments - - 7,902.40 - 13,500.30 19.81 II Inventories 708.20 724.50 596.80 518.30 191.80 161.52 III Trade receivables 17,780.50 18,741.90 22,119.10 20,202.40 11,640.10 6,038.65 IV Cash and bank balances 5,604.40 8,761.80 4,515.17 4,057.93 7,143.29 8,080.79 V Short-term loans and

advances 58,676.90 61,813.60 70,470.49 50,827.20 31,499.68 40,871.52 VI Other current assets 4,753.60 4,265.20 2,765.47 4,281.48 3,911.16 85.75 87,523.60 94,307.00 108,369.43 79,887.31 67,886.33 55,258.04 Liabilities C Non-current liabilities I Long-term borrowings 57,437.50 39,870.80 36,416.70 54,230.00 53,099.90 46,158.40 II Deferred tax liabilities

(net) - - - - - 1,286.18 III Other long-term

liabilities 4,969.50 2,934.69 1,822.66 839.10 342.98 244.96 IV Long-term provisions 516.60 695.90 344.50 3,427.40 3,038.34 10,213.81

62,923.60 43,501.39 38,583.86 58,496.50 56,481.22 57,903.35 D Current liabilities I Short-term borrowings 55,642.70 102,371.40 114,773.20 70,233.50 41,028.60 12,179.68

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Annexure I

Reliance MediaWorks Limited

Summary statement of assets and liabilities of the Company, as restated (` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 II Trade payables 15,892.80 10,489.20 7,308.80 5,162.10 8,245.67 2,038.73 III Other current liabilities 83,853.08 55,759.58 38,218.42 4,561.23 7,946.46 4,348.95 IV Short-term provisions 103.20 125.40 31.80 29.30 1,800.65 1,185.32 155,491.78 168,745.58 160,332.22 79,986.13 59,021.38 19,752.68 E Net Worth (A+B-C-D) 3,781.16 16,806.16 41,470.36 51,109.66 66,641.07 32,685.39 F Represented by i) Share capital 2,453.80 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04 ii) Reserves and surplus

(net) 1,327.36 14,499.86 39,164.06 48,803.36 64,334.77 30,695.35 G Net Worth (i+ ii) 3,781.16 16,806.16 41,470.36 51,109.66 66,641.07 32,685.39 Note : The above statement should be read with significant accounting policies and notes to summary statement of assets and liabilities of the Company, as restated (Annexure IV)

Annexure II

352

Reliance MediaWorks Limited

Summary statement of profit and loss of the Company, as restated (` in lakhs)

Particulars Period 2012 Period 2011 Period 2010 Period 2009

Period 2008

Period 2007

Revenue from operations 49,654.77 48,669.20 45,551.99 48,234.34 26,894.71 32,008.52 Other income 3,570.40 5,618.20 3,073.20 6,647.90 5,385.30 7,615.44 Total revenue 53,225.17 54,287.40 48,625.19 54,882.24 32,280.01 39,623.96

Direct operational expenses 19,482.80 20,449.70 15,631.90 15,752.90 7,585.30 11,063.53 Employee benefits expense 10,168.90 9,882.50 5,969.20 5,645.80 2,272.80 2,003.91 Finance costs (including loss on derivative contracts) (net) 28,028.57 16,973.30 11,306.60 12,363.70 2,751.34 609.71 Depreciation, amortisation and impairment expense 7,154.00 6,735.10 6,087.40 12,296.61 9,971.04 9,306.98 Other expenses 34,241.70 24,594.80 18,427.09 13,743.54 7,150.27 6,232.54 Total expenses 99,075.97 78,635.40 57,422.19 59,802.55 29,730.75 29,216.67 (Loss) / profit before tax (45,850.80) (24,348.00) (8,797.00) (4,920.31) 2,549.26 10,407.29 Less - Provision for taxes - Current tax - - - - - - - Deferred tax charge / (credit) - - - (134.80) 621.40 496.88 - Fringe benefit tax - - - 151.50 71.49 47.68 Net (loss) / profit after tax before adjustment pursuant to Schemes (45,850.80) (24,348.00) (8,797.00) (4,937.01) 1,856.37 9,862.73 Adjustment pursuant to Composite Scheme of Amalgamation and Arrangement - - - - - 195.19 Net (loss)/ profit after tax (Balance carried to Annexure VI) (45,850.80) (24,348.00) (8,797.00) (4,937.01) 1,856.37 9,667.54 The above statement should be read with significant accounting policies and notes to summary statement of profit and loss of the Company, as restated (Annexure IV)

Period 2012 - Twelve months ended 31 March 2012 Period 2011 - Year ended 31 March 2011 Period 2010 - Year ended 31 March 2010 Period 2009 - Year ended 31 March 2009 Period 2008 - Nine months ended 31 March 2008 Period 2007 - Fifteen months ended 30 June 2007

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Reliance MediaWorks Limited Annexure III Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 A Cash Flow from

operating activities

Net (loss) / profit before tax, as restated (45,850.80) (24,348.00) (8,797.00) (4,920.31) 2,549.26 10,407.29

Adjustment pursuant to Composite Scheme of Amalgamation and Arrangement - - (195.19)

Adjustment for Depreciation and

amortisation expense 7,154.00 6,735.10 6,087.40 12,296.61 9,971.04 9,306.98

Bad debts / advances written-off 48.20 107.30 50.50 263.00 385.10 -

Provision for doubtful debts and advances 1,625.00 1,658.20 121.90 - -

Provision for diminution in value of non-current investments 700.06 - - - - -

Sundry balances written-off 180.20 - - - - -

Capital work-in-progress written-off 3,613.90

Dividend income - - (85.30) (205.40) (148.80) (269.39) Interest income (825.20) (773.20) (406.40) (716.70) (831.50) (2,914.48) Profit on

derivative contract - - - - (977.40) (2,671.24)

Loss / (profit) on sale / discarding of fixed assets (net) 292.44 (2,701.10) 40.80 4.40 56.50 5.25

Gain on sale of non-current investments (766.50) - - - - -

Gain on sale of current investments (32.10) (423.60) (274.40) (1,969.20) (2,669.40) (1,531.64)

Provisions written back - - (241.70) - - -

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Reliance MediaWorks Limited Annexure III Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Unrealised

foreign exchange (gain) / loss (2,316.90) (305.30) 2,000.20 (807.20) (18.10) 36.97

Finance costs (including loss on derivative contracts) (net)

28,028.57

16,973.30

11,306.60

12,363.70

2,751.34

609.71

Operating (loss) / profit before working (8,149.13) (3,077.30) 9,802.60 16,308.90 11,068.04 12,784.26

capital changes and before net results of Radio business

Adjustment for cash loss pertaining to transaction relating to Radio business up to 31 March 2008 pursuant to Modified Composite Scheme of Amalgamation and Arrangement - - - - (8,377.00) -

Operating (loss) / profit before working capital changes (8,149.13) (3,077.30) 9,802.60 16,308.90 2,691.04 12,784.26

Adjustment for :

(Increase) / decrease in trade receivables (560.60) 2,749.20 (2,008.60) (17,317.60) (7,582.14) (2,414.08)

Decrease / (increase) in loans and advances and other assets 3,678.10 (5,484.91) (1,978.10) (6,541.45) (5,773.14) (45,891.07)

Decrease / (increase) in inventories 16.30 (127.70) (78.50) (325.40) (30.30) (31.17)

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Reliance MediaWorks Limited Annexure III Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Increase /

(decrease) in trade and other payables 5,872.83 4,988.71 4,863.50 (4,444.30) 9,061.70 (743.07)

Cash generated from / (used in) from operating activities 857.50 (952.00) 10,600.90 (12,319.85) (1,632.84) (36,295.13)

Taxes paid (net of refunds) 1,219.00 1,693.00 (1,122.00) (1,544.50) (1,346.80) (1,607.05)

Net cash generated from / (used in) operating activities (A) 2,076.50 741.00 9,478.90 (13,864.35) (2,979.64) (37,902.18)

B Cash flow from

investing activities

Purchase of fixed assets (3,291.60) (15,372.10) (24,733.56) (21,363.60) (46,194.40) (11,673.89)

Proceeds from sale of fixed assets / advance 19,421.40 13,986.70 10.80 1,087.60 12.10 48.38

against sale of assets

Proceeds on sale of non-current investments 1,233.60 1.00 4,066.80 3,127.30 - -

Loan to subsidiaries and joint ventures (net) (5,038.50) (13,597.70) (21,195.70) 0.00 - -

Purchase of non-current investment - in shares of subsidiaries companies / joint venture/ associates (1.00) (2,000.00) (3,005.00) (201.80) (2,720.80) (6,507.35)

356

Reliance MediaWorks Limited Annexure III Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Advance for

application money towards subscription of shares in a joint venture - - (125.00) - - -

Repayment of capital by Partnership firm - - 241.70 - - -

Purchase of non-current investments – other - - (9.90) (4.50) (0.40) -

Proceeds from / (Investment in) current investment funds (net) 32.10 8,326.00 (7,628.00) 13,769.50 (13,471.39) 44,105.31

Dividend income - - 85.30 205.40 148.80 269.39 Interest income 980.10 685.90 425.60 1,395.40 238.40 814.14 Cash generated

from / (used in) investing activities 13,336.10 (7,970.20) (51,866.96) (1,984.70) (61,987.69) 27,055.98

Taxed paid (net of refunds) (43.40) (17.00) (26.70) (78.10) (194.40) (118.83)

Net Cash generated from / (used in) investing activities (B) 13,292.70 (7,987.20) (51,893.66) (2,062.80) (62,182.09) 26,937.15

C Cash flow from

financing activities

Proceeds from long-term borrowings 10,000.00 37,500.00 3,500.00 - 40,000.00

-

Proceeds from issue of long-term debentures 35,000.00 - - - -

Proceeds from short-term borrowings (net) (46,728.60) 2,598.10 54,539.70 31,250.80 28,845.30 11,193.00

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Reliance MediaWorks Limited Annexure III Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Proceeds from

issue of Preference Shares 29,500.00 - - - - -

Repayment of Foreign currency convertible bonds - (15,814.50)

Repayment of long-term borrowings (23,212.50) (17,083.30) - - - -

Profit on derivative contract - - - 977.40 2,671.24

Interest recoverable from Reliance Broadcast Network Limited (576.80) (1,448.60) (2,507.89) (2,584.90)

Recovered from Reliance Broadcast Network Limited pursuant to Scheme of Arrangement 20,000.00 - -

Dividend (including dividend distribution tax) paid - (1,349.20) (1,164.10) (1,020.23)

Finance costs (including loss on derivative contracts) (net) (21,586.70) (16,757.90) (13,034.60) (11,201.60) (4,795.30) (321.57)

Net cash flow (used in) / generated from financing activities ( C ) (17,604.60) 8,993.80 42,497.21 16,115.10 63,863.30 12,522.44

Net increase in cash and cash equivalent (A+B+C) (2,235.40) 1,747.60 82.45 187.95 (1,298.43) 1,557.41

Cash and cash equivalents as at beginning of the period 3,201.10 1,453.50 1,371.05 1,989.10 1,987.53 347.70

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Reliance MediaWorks Limited Annexure III Summary statement of cash flow of the Company, as restated (` in lakhs) Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Cash and cash

equivalents adjusted pursuant to Modified Composite Scheme of Amalgamation and Arrangement - - (843.70)

Cash and cash equivalents as at end of the period (refer note (I) (II) D of Annexure VIII) 965.70 3,201.10 1,453.50 1,371.05 1,989.10 1,987.53

(2,235.40) 1,747.60 82.45 187.95 (1,298.43) 1,557.41 Note :

3. The above cash flow statement has been prepared under the "Indirect Method" as set out in Accounting Standard 3 - Cash Flow Statement

4. During the year, the Company has converted its loans to a subsidiary into preference shares amounting to ` 12,000 lakhs

The above statement should be read with significant accounting policies and notes to summary statement of cash flow of the Company, as restated (Annexure IV)

Period 2012 - Twelve months ended 31 March 2012 Period 2011 - Year ended 31 March 2011 Period 2010 - Year ended 31 March 2010 Period 2009 - Year ended 31 March 2009 Period 2008 - Nine months ended 31 March 2008 Period 2007 - Fifteen months ended 30 June 2007

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Annexure IV Reliance MediaWorks Limited Significant accounting policies and notes to the restated summary statements

The figures for Period 2012 represents the twelve months ended 31 March 2012, Period 2011 represents the year ended 31 March 2011, Period 2010 represents the year ended 31 March 2010, Period 2009 represents the year ended 31 March 2009, Period 2008 represents the nine months ended 31 March 2008 and Period 2007 represents the fifteen months ended 30 June 2007. Summary statements are not strictly comparable on account of accounting pursuant to Court approved Schemes in Period 2007, Period 2008 and Period 2009. Also, the summary statements are not comparable on account of varying accounting periods forming part of them.

The restated summary statements have been prepared to comply in all material respects with the requirements of Schedule II to the Companies Act, 1956 (“the Act”) read with the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2009 (“the SEBI Regulations”) notified by SEBI on August 26, 2009, as amended, to the extent applicable.

A. Summary of significant accounting policies

1. Basis of preparation

These summary statements are prepared and presented under the historical cost convention on the accrual basis of accounting except for revaluation of certain fixed assets and in accordance with the Accounting Standards (‘AS’) notified in the Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956 (‘the Act’), to the extent applicable. The summary statements are presented in Indian Rupees in lakhs except per share data and where mentioned otherwise.

Effective 1 April 2011, as per the Government Notification no. S.O. 447 (E) dated 28 February 2011 (as amended by notification no. F.No/2/6/2008-CL-V dated 30 March 2011), read with General Circular no. 62/2011 dated 5 September 2011, issued by the Ministry of Company Affairs, the revised Schedule VI notified under the Act has become applicable to the Company for the purpose of preparation and presentation of its summary statements. The adoption of revised Schedule VI does not impact the recognition and measurement principles followed for preparation of summary statements. All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out in the revised Schedule VI.

Interim condensed financial statements for the Period 2012 of Reliance MediaWorks Limited ('the Company') have been prepared in accordance with Accounting Standard 25 "Interim Financial Reporting" (‘AS 25’) prescribed in the Companies (Accounting Standards) Rules, 2006 issued by the Central Government in consultation with National Advisory Committee on Accounting Standards and in accordance with the relevant provisions of the Companies Act, 1956, to the extent applicable. These interim condensed financial statements should be read in conjunction with annual financial statements of the Company for the year ended and as at 31 March 2011. The accounting policies followed in preparation of these condensed financial statements are consistent with those followed in the preparation of the annual financial statements.

The restated summary statements of Company have been prepared to comply in all material respects with the requirements of Schedule II to the Companies Act, 1956 (“the Act”) and the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations 2009 (“the SEBI Regulations”) notified by SEBI on August 26, 2009, as amended, to the extent applicable.

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2. Use of estimates The preparation of summary statements of the Company in conformity with generally accepted accounting principles (‘GAAP’) in India requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent liabilities on the date of the summary statements and the reported amount of income and expenses during the reported period. The estimates and assumptions used in the accompanying financial statements are based upon management’s evaluation of relevant facts and circumstances as at the date of the financial statements, which in its opinion are prudent and reasonable. Actual results could differ from those estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

3. Fixed assets and depreciation / amortisation

a. Tangible assets Tangible fixed assets are stated at cost and / or revalued amount in accordance with scheme of amalgamation less accumulated depreciation and any provision for impairment. Cost includes freight, duties, taxes (other than those recoverable from tax authorities) and other expenses related directly / indirectly to the acquisition / construction and installation of the fixed assets for bringing the asset to its working condition for its intended use. Depreciation on fixed assets is provided on the straight line method, at the rates prescribed in Schedule XIV to the Act, which, in management’s opinion, reflects the estimated useful lives of those fixed assets, except in case of following assets of theatrical exhibition segment wherein depreciation is provided at following rates:

Leasehold improvements / buildings are depreciated over the lower of the useful life of the asset and the lease term, on a straight line basis.

Individual assets costing up to ` 0.05 lakhs are depreciated fully in the year of acquisition.

b. Intangible assets Intangible assets, all of which have been acquired / created and are controlled through custody or legal rights, are capitalised at cost, where they can be reliably measured. Where capitalised, intangible assets are regarded as having a limited useful economic life and the cost is amortised over the lower of useful life and ten years. Application software purchased, which is not an integral part of the related hardware, is shown as intangible assets and amortised on a straight line basis over its useful life, not exceeding five / ten years, as determined by management. Film rights comprise negative rights and distribution rights in films and are for a contractually specified mode of exploitation, period and territory and are stated at cost less accumulated amortisation. Cost of film rights comprises original purchase price / minimum guarantee. Cost is ascertained on specific identification basis where possible. In case multiple

Particulars of fixed assets Rate of depreciation Plant and machinery 10% Office equipment 10% Furniture and fixture 10% Computers 20% Vehicles 10%

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films / rights are acquired for a consolidated amount, cost is allocated to each film / right based on management’s best estimates.

The individual film forecast method is used to amortise the cost of film rights acquired. Under this method, costs are amortised in the proportion that gross revenues realised bear to management’s estimate of the total gross revenues expected to be received. If estimates of the total revenues and other events or changes in circumstances indicate that the realisable value of a right is less than its unamortised cost, a loss is recognised for the excess of unamortised cost over the film right’s realisable value.

In respect of unreleased films, payments towards film rights are classified under capital advances as the amounts are refundable in the event of non release of the film. Purchased goodwill is recognised by the Company on the basis of excess of purchase consideration paid over the value of the assets acquired at the time of acquisition and is amortised over its estimated useful life not exceeding ten years.

4. Impairment In accordance with AS 28 – ‘Impairment of Assets’, where there is an indication of impairment of the Company’s asset, the carrying amounts of the Company’s assets are reviewed at each balance sheet date to determine whether there is any impairment. The recoverable amount of the asset (or where applicable, that of the cash generating unit to which the asset belongs) is estimated as the higher of its net selling price and its value in use. An impairment loss is recognised whenever the carrying amount of an asset or a cash generating unit exceeds its recoverable amount. Impairment loss is recognised in the statement of profit and loss. If at the balance sheet date there is an indicator that a previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a maximum of the depreciated historical cost. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life.

5. Investments

Long-term investments are carried at cost. A provision for diminution is made to recognise a decline, other than temporary, in the value of long-term investments and is determined separately for each individual investment.

Current investments are carried at lower of cost and fair value.

6. Inventories

Inventories (comprising of food and beverage items, chemicals, negative film rolls, xenon lamps and stores and spares related to theatrical exhibition / film production services business etc.) are stated at the lower of cost and net realisable value. Cost is determined on the first-in first out (FIFO) basis.

7. Employee benefits Short term employee benefits: All employee benefits payable wholly within twelve months of rendering the service are classified as short term employee benefits. The undiscounted amount of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised as an expense during the period.

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Long term employee benefits: Provident fund and other schemes The Company’s state governed provident fund scheme, employee state insurance scheme and labour welfare fund are defined contribution plans. The contribution paid / payable under the schemes is recognised during the period in which the employee renders the related service. Gratuity Plan The Company’s gratuity benefit scheme is a defined benefit plan. The Company’s net obligation in respect of the gratuity benefit scheme is calculated by estimating the amount of future benefit that employees have earned in return for their service in the current and prior period; that benefit is discounted to determine its present value and the fair value of any plan assets is deducted. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method. The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government securities as at the balance sheet date.

Actuarial gains and losses are recognised immediately in the statement of profit and loss.

Other Long term employment benefits: Compensated absences which are not expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as a liability at the present value of the defined benefit obligation at the balance sheet date, determined based on actuarial valuation using Projected Unit Credit Method. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government securities as at the balance sheet date.

8. Revenue recognition Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. The amount recognised as revenue is exclusive of value added tax, service tax and net of trade discounts. Amount of entertainment tax is shown as a reduction from revenue. Film production services Revenue from processing / printing of cinematographic films is recognised upon completion of the related processing / printing. Revenue from processing of digital content is recognised using the proportionate completion method. Use of the proportionate completion method requires the Company to estimate the efforts expended to date as a proportion of the total efforts to be expended. Efforts expended have been used to measure progress towards completion, as there is a direct relationship between efforts expended and contracted output.

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Sale of traded goods is recognised when the risks and rewards of ownership are passed on to the customer, which generally coincides with the dispatch of goods. Income from equipment / facility rental is recognised over the period of the relevant agreement / arrangement. Theatrical exhibition and related income Sale of tickets Revenue from theatrical exhibition is recognised on the date of the exhibition of the films and comprises proceeds from sale of tickets, gross of entertainment taxes. As the Company is the primary obligor with respect to exhibition activities, the share of distributors in these proceeds is separately disclosed as distributors’ share. Amount of entertainment tax is shown as a reduction from revenue. Sale of food and beverages Revenue from sale of food and beverages is recognised upon sale and delivery at the counter. Advertisement / sponsorship revenue Revenue from advertisements, sponsorship and events is recognised on the date of the exhibition of the advertisement / event, over the period of the contract or on completion of the Company’s obligations, as applicable. Film production, distribution and related income Film production and related income

Revenue from sale of content / motion pictures is accounted for on the date of agreement to assign / sell the rights in the concerned motion picture / content or on the date of release of the content / motion picture, whichever is later.

Income from film distribution activity

In case of distribution rights of motion pictures / content, revenue is recognised on the date of release / exhibition.

Revenue from other rights such as satellite rights, overseas rights, music rights, video rights, etc. is recognised on the date when the rights are made available to the assignee for exploitation.

Revenue from sale of VCDs / DVDs, etc is recognised when the risks and rewards of ownership are passed on to the customer, which generally coincides with the dispatch of the products.

Interest income / income from film financing

Interest income, including from film / content related production financing, is recognised on a time proportion basis at the rate implicit in the transaction.

Dividend income

Dividend income is recognised when the right to receive dividend is unconditional at the balance sheet date.

Marketing rights / Rights to profit

Amounts received in lieu of future marketing rights sale, right to future profit from business of the Company and other rights are recognised as income in the period of entering into the contract.

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9. Foreign currency transactions Transactions denominated in foreign currency are recorded at the exchange rate prevailing on the date of the transactions. Exchange differences arising on foreign exchange transactions settled during the period are recognised in the statement of profit and loss of the period.

Monetary assets and liabilities denominated in foreign currencies as at the balance sheet date are translated at the closing exchange rates on that date; the resultant exchange differences are recognised in the statement of profit and loss except in case of exchange differences arising on translation of monetary items which form part of Company’s net investment in a non-integral foreign operation which is accumulated in a ‘Foreign currency translation reserve’ until its disposal.

Non-monetary items which are carried at historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction.

Forward contracts are entered into to hedge the foreign currency risk of the underlying transaction. The premium or discount on all such contracts arising at the inception of each contract is amortised as income or expense over the life of the contract. Exchange differences on forward contracts are recognised as income or expense in the statement of profit and loss of the period. Any profit or loss arising on the cancellation and renewal of forward contract are recognised as income or expense for the period.

10. Earnings per share In determining earning per share, the Company considers the net result after tax and includes the post tax effect of any extraordinary / exceptional item. The number of shares used in computing basic earnings per share is the weighted average number of shares outstanding during the period. The number of shares used in computing diluted earnings per share comprises the weighted average number of shares considered for deriving basic earnings per share and also the weighted average number of shares that could have been issued on the conversion of all dilutive potential equity shares unless the results would be anti - dilutive. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless issued at a later date.

11. Taxation

Income-tax expense comprises current tax expense and fringe benefit tax computed in accordance with the relevant provisions of the Income tax Act, 1961 and deferred tax charge or credit.

Current tax provision is made based on the tax liability computed after considering tax allowances and exemptions, in accordance with the Income tax Act, 1961. Deferred tax charge or credit and the corresponding deferred tax liability or asset is recognised for timing differences between the profits / losses offered for income tax and profits / losses as per the summary statements. Deferred tax assets and liabilities are measured using the tax rates and tax laws that have been enacted or substantively enacted at the Balance sheet date.

Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realised in future. However, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at each Balance sheet date and written down / up to reflect the amount that is reasonably / virtually certain (as the case may be) to be realised.

Provision for fringe benefit tax was made on the basis of applicable rates on the taxable value of eligible expenses of the Company as prescribed under the Income Tax Act, 1961 till Period 2009 on the basis of applicability.

12. Share issue / Foreign Currency Convertible Bonds (FCCB) issue expenses and premium on redemption.

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Share / FCCB issue expenses incurred and premium payable on FCCB are adjusted in the period of issue against the Securities premium reserve.

13. Provisions and contingencies

Provisions comprise liabilities of uncertain timing or amount. Provisions are recognised when the Company recognises that it has a present obligation as a result of past events, it is more likely than not that an outflow of resources will be required to settle the obligation and the amount can be reasonably estimated.

A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but probably will not require an outflow of resources. When there is a possible obligation or a present obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

Loss contingencies arising from claims, litigation, assessment, fines, penalties, etc. are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated.

14. Leases

Rental expenses in non-cancellable arrangements / agreements with scheduled rent increases are recorded on a straight line basis over the lease term.

15. Borrowing costs Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

16. Commercial papers

Commercial papers are recognised as a liability at the amount of cash received at the time of issuance i.e. discounted value. The discount is amortised as interest cost over the period of the commercial paper at the rate implicit in the transaction.

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B. Significant changes in accounting policies and other adjustments credited / (debited) to the restated summary statements: (`̀ in lakhs)

Particulars Refer Note

Below

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Adjustment to balance at the beginning in the statement of profit and loss as at 1 April 2006

(Loss) / profit after tax as per audited financial statements

(43,415.53) (25,621.00) (10,437.00) (2,972.60) 4,590.50 8,338.33

Balances as per audited financial statements

2,474.58

Adjusted for

Change in depreciation method (a) - - - (834.31) 370.57 77.66 386.08

Change in estimated useful life (b) - - - - -

(85.91) (132.86)

Restatement of FCCB’s (c) - 1,272.40 1,718.10 (1,130.10) (1,860.40) - -

Effect of qualification - Loss on derivative contracts

(d)

(2,435.27) - - - - - -

Excess / (short) provision for tax (e) - 0.60 (78.10) -

(1.70) 9.64 69.56

Excess / (short) Minimum alternative tax (e) - - - -

(1,242.60) 1,242.60 -

Net impact of all adjustments

(2,435.27) 1,273.00 1,640.00 (1,964.41) (2,734.13) 1,243.99 322.78

Deferred tax impact of adjustments (e) - - - -

- 85.22 (85.22)

Loss / (profit) after tax as restated

(45,850.80) (24,348.00) (8,797.00) (4,937.01) 1,856.37 9,667.54

Balance of statement of profit and loss as on 1 April 2006, as restated

2,712.14

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a) Change in accounting policy for depreciation

During Period 2009, the Company has charged depreciation as per the written down value method in the film production services, production and distribution business and for unallocated assets at the rates specified in Schedule XIV of the Companies Act, 1956 till 31 March 2008. Starting 1 April 2008, the Company has changed its policy to charge depreciation as per the straight line method at the rates specified in Schedule XIV of the Companies Act, 1956. Accordingly, depreciation charge for the previous period’s has been restated based on the new method and the impact of change in depreciation method for the period prior to 1 April 2006 has been adjusted to opening balance of the surplus in statement of profit and loss, as restated as on 1 April 2006.

b) Change in estimated useful life of assets The Company had revised the estimated useful lives of certain fixed assets pertaining to the theatrical exhibition business from 1 July 2007, since in the opinion of the management, the revised useful life reflect the estimated period of economic benefit to be derived from the use of such assets. For the purpose of these summary statements, depreciation has been recomputed based on revised useful life of the assets from the date of capitalisation of these assets. Accordingly depreciation for the Period 2007 has been restated and depreciation for the period prior to 1 April 2006 has been adjusted to opening balance of the surplus in statement of profit and loss, as restated as on 1 April 2006.

c) Accounting for Foreign Currency Convertible Bonds (‘FCCB’) During Period 2008, the liability for FCCB’s had been reclassified as a non-monetary liability inter-alia on the basis of the trend of earnings, movement of the Company’s share prices and conversion option exercised by the FCCB holders (bondholders holding 75.42% of the FCCB had exercised conversion option as of 31 March 2008). However, during Period 2011, the balance FCCB’s were redeemed at a premium, as per the terms of the issue document. The Company had reversed foreign exchange fluctuation loss aggregating to ` 438.06 lakhs in Period 2008 based on the consideration of FCCB’s as a non-monetary liability. This position was carried forward till Period 2010 and was a matter of emphasis referred to in the auditor’s report for Period 2008, 2009 and 2010. Hence, the Company has reversed the reversal made during Period 2008 and recognised the loss / gain on the non-converted portion of FCCB’s, considering them as a monetary item in Period 2008, 2009 and 2010 and reversed this loss in Period 2011, wherein the Company had recognised the entire loss on redemption in its audited financial statements.

d) Effect of qualification - Loss on derivate contracts After the balance sheet date, considering the adverse foreign exchange fluctuation and interest rates, the Company had terminated the assigned derivative contracts pertaining to interest rate swap after the period ended 31 March 2012 i.e. on 3 April 2012. The Company had incurred loss of ` 2,435.27 lakhs on pre-mature termination of this contract. The same will be accounted by the Company in the next period being loss for the next period. Since this was the subject matter of qualification in the Auditors’ Report on the financial statements for Period 2012, this has been adjusted in the Statement of Profit and loss, as restated for the current period.

e) Tax impact on restatement The statement of profit and loss of some period’s include amounts paid / provided for or refunded / written back, in respect of shortfall / excess income tax (including fringe benefit tax, wealth tax and MAT credit entitlement) arising out of assessments, appeals etc. which has now been adjusted in the respective Period’s tax liability. Also, income tax (current tax and deferred tax) has been computed on adjustments made and has been adjusted accordingly in the statement of profit and loss, as restated for the respective periods.

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f) Consequent to the notification of the Companies (Accounting Standards) Rules, 2006, with effect from 1 July 2007, the Company adopted Accounting Standard (AS 15) - Employee Benefits. However, there was no significant impact on adoption of the Standard which is required to be adjusted to the opening balance of reserves and surplus.

g) Adjustments have been made in the Restated Summary Statements, wherever required, by a reclassification of the corresponding items of income, expenses, assets and liabilities, in order to bring them in line with the groupings as per the audited financials of the Company for Period 2012 as prepared under Government Notification no. S.O. 447 (E) dated 28 February 2011 (as amended by notification no. F.No/2/6/2008-CL-V dated 30 March 2011), read with General Circular no. 62/2011 dated 5 September 2011, issued by the Ministry of Company Affairs.

h) The Company in Period 2009 has classified its operations in US and in Period 2010 its operations in Nepal as non-integral to the operations of the Parent Company in India. The impact of this change is not material on the results of respective periods and hence, no restatement has been made for the same.

i) De-merger of Radio business

During the year ended 31 March 2006, the Company commenced operation of the Radio business. The Company was granted 45 FM Radio operation licenses in various parts of India including all metros.

During Period 2007, the Board of Directors of the Company, members of the Company and the Hon’ble High Court of Judicature at Bombay approved the Composite Scheme of Amalgamation and Arrangement (‘Composite Scheme’) which among other things provided for demerger of the Radio business of the Company to Reliance Broadcast Network Limited with effect from 1 April 2006. The Company had given the in-principle effect of the Composite Scheme including the demerger of the Radio business of the Company to Reliance Broadcast Network Limited in the accounts for Period 2007 pending filing of the Composite Scheme with the Registrar of Companies. Subsequently, due to non-receipt of approval from the Ministry of Information and Broadcasting, the Company filed the Modified Composite Scheme of Amalgamation and Arrangement (the ‘Modified Composite Scheme’) which provided for reversal of the effect of demerger, of the Radio business that was given effect to in the accounts for Period 2007 and provided for adjusting the net result of the transactions related to Radio business for the period 31 March 2006 till the effective date of the Modified Composite Scheme i.e. 31 March 2008 in the General reserve of the Company.

During Period 2009, the Board of Directors of the Company, members of the Company and the Hon’ble High Court of Judicature at Bombay approved a Scheme of Arrangement (‘the Radio Scheme') which provided for demerger of the Radio business of the Company effective 1 April 2008 to Reliance Broadcast Network Limited. Accordingly, transactions related to Radio business do not form part of the statement of profit and loss for the Period 2007 and 2008. However, the assets and liability were included in the summary statement of assets and liability in Period 2008. The assets and liabilities of the Radio business for Period 2008 which are included in the statement of assets and liability of the Company are:

Particulars Period 2008 (` in lakhs)

Fixed assets Gross block 32,728.23 Less: Accumulated depreciation 3,845.38 Net block 28,882.85 Capital work in progress 2,309.17 Current assets Inventories 17.67 Sundry debtors 6,679.51 Cash and bank balances 843.71

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Particulars Period 2008 (` in lakhs)

Loans and advances 6,387.06 13,927.95 Current liabilities and provisions Current liabilities 4,348.71 Provisions 626.94 4,975.65 Net working capital 8,952.30 Less: Loans 2,046.28 Net capital employed 38,098.04

(Refer note 1 of VI of E of Annexure IV for details of the Composite Scheme of Amalgamation and Arrangement given effect to in the accounts of the Company for Period 2007, note 1 of V of E of Annexure IV for details of the Modified Composite Scheme of Amalgamation and Arrangement given effect to in the accounts of the Company for Period 2008 and note 1 of IV of E of Annexure IV for details of the Scheme of Arrangement given effect to in the accounts of the Company for Period 2009)

C. Auditors’ qualification

As reproduced below auditors have qualified their audit report for Period 2012 for derivative contracts

We draw attention to Note 35 to the condensed financial statements regarding accounting treatment for loss on cancellation of derivative contract. On cancellation of the assigned derivative contract, post period end, loss aggregating to ` 2,435.37 lakhs has devolved on the Company. As explained in said note, the Company has not accounted for this loss as required by the principles of prudence as enunciated in Accounting Standard 1- Disclosure of Accounting Policies. Consequently, the loss on derivative contract aggregating to ` 2,435.37 lakhs has not been recognised by the Company during the twelve months period ended 31 March 2012. Had the Company accrued for this loss, the loss before tax for and deficit in Statement of Profit and loss account as at period ended 31 March 2012 would be higher by the said amount.

The management has adjusted the effect of the qualification in the restated statements.

(Refer note (d) of B of Annexure IV for effect of restatement of the qualification)

D. Extract of other matters / matter of emphasis referred by auditors in their reports as reproduced below:

a) Period 2012

Without qualifying our report, we draw attention to note 42 to the condensed financial statements; the Company’s net worth is substantially eroded and the Company has incurred a loss of ` 43,415.50 lakhs for the twelve months period 1 April 2011 to 31 March 2012, indicating the existence of uncertainty that may cast doubt about the Company’s ability to continue as a going concern. Considering the matters set out in the said note, this condensed financial statement is prepared on a going concern basis.

(Refer note 5 of I of E of Annexure IV for note 42 which has been referred to above)

b) Period 2011 i) Under clause (x) of CARO –

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The accumulated losses of the Company are more than 50% of its net worth and it has incurred cash losses in the current financial year and in the immediately preceding financial year.

ii) Under clause (xvii) of CARO –

According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company, we report that the Company has used funds raised on short term basis for long term investments. The Company has used short term borrowings aggregating ` 67,740.00 lakhs to long term purpose.

c) Period 2010

i) Without qualifying our report, we draw attention to note 17 of schedule 22 to the financial statements regarding accounting of the Foreign Currency Convertible Bonds (‘FCCB’). During the financial period ended 31 March 2008, the Company re-classified the liability towards FCCB as non–monetary liability inter-alia on the basis of the trend of earnings, movement of the Company’s share prices and conversion option exercised by the FCCB holders. The Company continues to classify the liability towards FCCB as non–monetary liability as in its view the current fall in the market price of the Company’s share price and non-conversion by bond holders is a temporary aberration, consequently, the foreign exchange fluctuation gain for the year aggregating ` 1,718.10 lakhs has not been recognised and the said liability has not been restated at the year-end exchange rate. An alternate view exists that the liability towards FCCB is a monetary liability and should be restated at the year-end exchange rate in accordance with Accounting Standard 11 - ‘The Effects of Changes in Foreign Exchange Rates’ prescribed in the Companies (Accounting Standards) Rules, 2006. There is no specific guidance of The Institute of Chartered Accountants of India on accounting for foreign currency bonds convertible into equity shares at the option of the holder. Had the said liability been considered as a monetary liability as before, the loss before tax for the current year would be lower by ` 1,718.10 lakhs and the reserves and surplus would be lower by ` 1,272.30 lakhs.

(Refer note 5 of III of E of Annexure IV for note 17 of Schedule 22 which has been referred to above)

(Refer note (c) of B of Annexure IV for subsequent recognition of FCCB’s as a monetary item) ii) Under clause (xvii) of CARO – According to the information and explanations given to us and on an overall examination of the Balance sheet of the Company, we report that the Company has used funds raised on short term basis for long term investments. The Company has used short term borrowings aggregating ` 26,560 lakhs to fund fixed assets, investments and long term loans to subsidiaries.

d) Period 2009 i) Without qualifying our report, we draw attention to Note 19 of Schedule 22 to the financial statements regarding accounting of the Foreign Currency Convertible Bonds (‘FCCB’). During the previous financial period ended 31 March 2008, the Company reclassified the liability towards FCCB as non–monetary liability inter-alia on the basis of the trend of earnings, movement of the Company’s share prices and conversion option exercised by the FCCB holders. The Company continues to classify the liability towards FCCB as non– monetary liability as in its view the current fall in the market price of the Company’s share price and non conversion by bond holders during the year is a temporary aberration, consequently, the foreign exchange fluctuation (net loss) for the year aggregating ` 1,130.10 lakhs has not been recognised and the said liability has not been restated at the period-end exchange rate. An alternate view exists that the liability towards FCCB is a monetary liability and should be restated at the period-end exchange rate in accordance with Accounting Standard 11 - ‘The Effects of Changes in Foreign Exchange Rates’ prescribed in the Companies (Accounting Standards) Rules, 2006 issued by the Central government in consultation with the National Advisory Committee on Accounting Standards. There is no specific guidance of The Institute of Chartered Accountants of India on accounting for foreign currency bonds convertible into equity shares at the option of the holder. Had the said liability been considered as a monetary liability, the loss before tax for the current year would be higher by ` 1,130.07 lakhs and the reserves and surplus would be lower by ` 2,990.40 lakhs.

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(Refer note 7 of IV of E of Annexure IV for note 19 of Schedule 22 which has been referred to above) (Refer note (c) of B of Annexure IV for subsequent recognition of FCCB’s as a monetary item) ii) Without qualifying our opinion, we draw attention to Note 2 of Schedule 22 to the financial statements. As more fully explained in the said Note, during the year, the Hon’ble High Court of Judicature at Mumbai vide its order dated 8 May 2009 sanctioned the Scheme of Amalgamation of the Company with its wholly owned subsidiaries Adlabs Multiplexes and Theatres Limited, Adlabs Multiplex Limited, Rave Entertainment Private Limited and Mahimna Entertainment Private Limited, under sections 391 to 394 of the Act. Pursuant to the said Scheme the Company has made an adjustment for diminution in value of its assets (production and distribution rights, fixed assets, investments, debtors and loans and advances) aggregating ` 15,669.70 lakhs by debiting the same to capital reserve instead of the statement of profit and loss. Had the Company debited the statement of profit and loss the loss before tax for the year would be higher by the said amount. (Refer note 2 of IV of E of Annexure IV for note 2 of Schedule 22 which has been referred to above) iii) Under clause (ix) (a) of CARO – According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted / accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees’ State Insurance, Income tax, Sales-tax / VAT, Customs duty, Entertainment tax, Investor Education and Protection Fund, Cess and other material statutory dues have been generally regularly deposited during the year by the Company with the appropriate authorities. In respect of service tax, management is in the process of reconciling the amounts accrued as per the books of account on a monthly basis as compared to the payment records maintained. Based on the payment records examined by us, the Company has been generally regular in depositing the said amounts with the appropriate authorities. As informed to us, the Company did not have any dues on account of Wealth tax. There were no dues on account of cess under Section 441A of the Act since the date from which the aforesaid section comes into force has not yet been notified by the Central Government. According to the information and explanations given to us and except for the outcome of the reconciliation referred to above, no undisputed amounts payable in respect of Provident fund, Employees’ State Insurance, Income tax, Sales-tax / VAT, Service tax, Customs duty, Entertainment tax, Investor Education and Protection Fund and other material statutory dues were in arrears as at 31 March 2009 for a period of more than six months from the date they became payable except for ` 391.30 lakhs being entertainment tax pertaining to multiplexes / single screens where the Company has made an application for availing exemption under the relevant Act retrospectively from the date of commencement of operations of the said multiplex. Also, as more fully explained in note 3 of Schedule 22 to the financial statements, no amount has been accrued in respect of Maharashtra Value Added Tax. (Note 3 of Schedule 22 refers to disclosure of contingent liabilities in Period 2009, refer Annexure XIII for details of contingent liabilities)

e) Period 2008 i) Without qualifying our report, we draw attention to Note 1 of Schedule 22 to the financial statements. As more fully explained in the said Note, during the period, the Hon'ble High Court of Judicature at Bombay vide its order dated 7 March 2008 sanctioned the Modified Scheme of Amalgamation and Arrangement ('the Modified Scheme') between the Company, Entertainment One India Limited ('E-ONE') and Mukta Adlabs Digital Exhibition Private Limited ('MADEL')#. The Scheme was filed with the Registrar of Companies ('ROC') on 31 March 2008. Pending completion of licensing and other procedural formalities, the original composite Scheme of amalgamation and arrangement between the Company, E-ONE, MADEL, Reliance Unicom Limited ('RUL') ## and their respective shareholders and creditors sanctioned by the Hon'ble High Court of Judicature at Bombay vide its order dated 15 September 2006 was not filed with the Registrar of Companies ('ROC') as required under Section 391(3) of the Companies Act, 1956 ('the Act'). However, the said original Scheme was given effect to by the Company's management in the previous period's

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financial statements for the fifteen months ended 30 June 2007, so as to give effect to the substance of the Scheme as approved by the Hon'ble High Court of Judicature at Bombay. The Modified Scheme inter-alia provides that the net results of the transactions related to the radio business of the Company for the period from 31 March 2006 to the Effective date (i.e. the date of filing the Modified Scheme with the ROC) be adjusted in the General reserve of the Company (the original scheme provided for the demerger of the radio business of the Company to RUL## effective 31 March 2006). As the original scheme was given effect to in the previous period's financial statements for the fifteen months ended 30 June 2007, only the modifications to the original scheme have been given effect to in the current period's financial statements (including reversal of demerger of radio business to RUL##).

# - The name of the Company was subsequently changed to Adlabs Multiplex and Theatres Limited

## - The name of the Company was subsequently changed to Reliance Broadcast Network Limited

(Refer note 1 of V of E of Annexure IV for note 1 of Schedule 22 which has been referred to above)

ii) Without qualifying our report, we draw attention to Note 21 of Schedule 22 to the financial statements regarding accounting of the Foreign Currency Convertible Bonds ('FCCB'). During the current period, the Company reclassified the liability towards FCCB as non-monetary liability inter-alia on the basis of the trend of earnings and movement of the Company's share prices. Accordingly, the foreign exchange fluctuation (net loss) aggregating to ` 438.10 lakhs accounted in previous period has been reversed and the foreign exchange fluctuation loss for the current period aggregating to ` 3,621.80 lakhs has not been recognised by management and the said liability has not been revalued at the period-end exchange rate. An alternate view exists that the liability towards FCCB is a monetary liability and should be revalued at the period-end exchange rate in accordance with Accounting Standard 11 - 'The Effects of Changes in Foreign Exchange Rates' prescribed in the Companies (Accounting Standards) Rules, 2006 issued by the Central government in consultation with the National Advisory Committee on Accounting Standard. There is no specific guidance of The Institute of Chartered Accountants of India on accounting for foreign currency bonds convertible into equity shares at the option of the holder. Had the said liability been considered as a monetary liability as before, the profit after tax would be lower by ` 4,118.90 lakhs. (Refer note 7 of V of E of Annexure IV for note 21 of Schedule 22 which has been referred to above) (Refer note (c) of B of Annexure IV for subsequent recognition of FCCB’s as a monetary item) iii) Under clause (ix) (a) of CARO –

According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted / accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees' State Insurance, Income tax, Customs duty, Entertainment tax and other material statutory dues have been generally regularly deposited during the period by the Company with the appropriate authorities. In respect of service tax and sales tax / VAT, management is in the process of reconciling the amounts accrued as per the books of account on a monthly basis as compared to the payment records maintained. Based on the payment records examined by us, the Company has been generally regular in depositing the said amounts with the appropriate authorities. As informed to us, the Company did not have any dues on account of Wealth tax and Investor Education and Protection Fund. There were no dues on account of cess under Section 441A of the Act since the date from which the aforesaid section comes into force has not yet been notified by the Central Government.

According to the information and explanations given to us and except for the outcome of the reconciliation referred to above, no undisputed amounts payable in respect of Provident fund, Employees' State Insurance, Income tax, Sales tax / VAT, Service tax, Customs duty, Entertainment tax and other material statutory dues were in arrears as at 31 March 2008 for a period of more than six months from the date they became payable except for ` 280.30 lakhs being entertainment tax pertaining to a multiplex where the Company has made an application for availing exemption under the relevant Act retrospectively from the date of commencement of operations of the said multiplex. Also, as more fully

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explained in note 4 of Schedule 22 to the financial statements, no amount has been accrued in respect of Maharashtra Value Added Tax.

(Note 4 of Schedule 22 refers to disclosure of contingent liabilities in Period 2008, refer Annexure XIII for details of contingent liabilities)

f) Period 2007 i) Without qualifying our report, we draw attention to note 1 of Schedule 22 to the financial statements. As more fully explained in the said Schedule, during the period, the Hon’ble High Court of Judicature at Bombay vide its order dated 15 September 2006 sanctioned a Composite Scheme of Amalgamation and Arrangement (‘the Scheme’) between the Company, Entertainment One India Limited (‘E-ONE’), Mukta Adlabs Digital Exhibition Private Limited (‘MADEL’)#, Reliance Unicom Limited (‘RUL’)## and their respective shareholders and creditors. The Scheme inter-alia provides for the following: the amalgamation of E-ONE with the Company effective 1 April 2005; the merger of the digital business of MADEL with the Company effective 1 April 2005; and the demerger of the radio business of the Company to RUL effective 31 March 2006.

As represented by the Company’s management, the Company has made an application to the Ministry of Information and Broadcasting for vesting of radio licenses held by it in the name of Reliance Unicom Limited (‘RUL’))##. Pending the said approval, the Scheme has not been filed with the Registrar of Companies (‘ROC’) as required under Section 391(3) of the Companies Act, 1956 (‘the Act’). However, for the purpose of these financial statements, pending completion of licensing and other procedural formalities, the Scheme has been given effect to by the Company’s management in view of the Court approval and to give effect to the substance of the Composite Scheme as approved by the Hon’ble High Court of Judicature at Bombay. Management has represented that it is reasonably certain that the Scheme will be filed with the ROC in due course. Also, we draw attention to note 8 of Schedule 22 to the financial statements. Should the Scheme referred to above not be made legally effective, remuneration paid / payable to the directors would be in excess of the limits prescribed under the Act and, consequently, necessary approval of the Central Government would be required to be obtained. The ultimate outcome of the completion of the licensing and procedural formalities cannot be presently determined and hence, no adjustments have been made to the financial statements in case the Scheme is eventually / subsequently modified, nullified or replaced with the sanction of the Hon’ble High Court of Judicature at Bombay.

# - The name of the Company was subsequently changed to Adlabs Multiplex and Theatres Limited

## - The name of the Company was subsequently changed to Reliance Broadcast Network Limited

(Refer note 1 of VI of E of Annexure IV for note 1 of Schedule 22 which has been referred to above)

(Note 8 of Schedule 22 refers to the disclosure of directors remuneration in Period 2008, refer Annexure XVIII - Related Party Disclosure for amounts paid to Directors)

ii) Under clause (ix) (a) of CARO –

According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts deducted / accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Employees’ State Insurance, Income tax, Sales tax / VAT, Service tax, Customs duty, Entertainment tax and other material statutory dues have been generally regularly deposited during the period by the Company with

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the appropriate authorities. As informed to us, the Company did not have any dues on account of Wealth tax and Investor Education and Protection Fund.

There were no dues on account of cess under Section 441A of the Act since the date from which the aforesaid section comes into force has not yet been notified by the Central Government.

According to the information and explanations given to us, no undisputed amounts payable in respect of Provident fund, Employees’ State Insurance, Income tax, Sales tax, Service tax, Customs duty, Entertainment tax and other material statutory dues were in arrears as at 30 June 2007 for a period of more than six months from the date they became payable except for ` 93.00 lakhs being entertainment tax pertaining to a multiplex where the Company has made an application for availing exemption under the relevant Act retrospectively from the date of commencement of operations of the said multiplex.

E. Extract of significant notes from audited financial statements I. For Period 2012

1. Lease disclosure under AS 19 – ‘Leases’

The Company is obligated under non-cancellable leases primarily for theatres, office premises and equipments which are renewable thereafter as per the term of the respective agreements.

The future minimum lease payments in respect of non-cancellable operating lease are as follows:

Particulars Minimum lease payments (` in lakhs)

Amounts due within one year from the balance sheet date 14,091.60

Amounts due in the period between one year and five years 50,384.40

Amount due after five years 79,578.80

Total 144,054.80

Amount payable within lock-in-period is ` 83,295.00 lakhs.

Amount debited to statement of profit and loss for lease rental is ` 16,257.50 lakhs

(excluding amount capitalised ` 228.20 lakhs)

2. After the balance sheet date, considering the adverse foreign exchange fluctuation and interest rates, the Company had terminated the assigned derivative contracts pertaining to interest rate swap after the period ended 31 March 2012 i.e. on 3 April 2012. The Company had incurred loss of ` 2,435.27 lakhs on pre-mature termination of this contract. The same will be accounted in the next period being loss for the next period.

3. Foreign currency exposures (other than investments) not covered by forward contracts

Particulars Currency Period 2012

Amount – foreign currency Amount – (`̀ in lakhs)

375

(lakhs)

Trade and other receivables USD 784.20 40,841.40

GBP 63.80 5,312.90

EURO 2.30 159.80

Trade and other payables USD 2.70 140.60

EURO 0.60 41.70

Borrowings USD 75.30 3,921.40

4. Interest in Joint ventures

The Company’s interests in jointly controlled entities (incorporated Joint Ventures) are:

Name of the Company

Country of Incorporation

% of ownership interest as at 31 March 2012

Swanston Multiplex Cinemas Private Limited India 50%

Cineplex Private Limited (up to 3 June 2011) India Nil

Divyashakti Marketing Private Limited India 50%

Details of Joint Venture

Particulars Period 2012 (`̀ in lakhs)

Balance Sheet EQUITY AND LIABILITIES Shareholders' funds

(a) Share capital 49.00 (b) Reserves and surplus (69.30)

Share application money, pending allotment 125.00

LIABILITIES Non-current liabilities

(a) Long-term borrowings 211.70 (b) Deferred tax liabilities (net) - (c) Other long-term liabilities 1.80 (d) Long-term provisions 2.50

Current liabilities

376

Particulars Period 2012 (`̀ in lakhs)

(a) Trade payables 110.10 (b) Other current liabilities 67.70 (c) Short-term provisions 9.10 Total 507.60

ASSETS Non-current assets

(a) Fixed assets Tangible assets (including Capital work-in-progress) 257.30 (b ) Long-term loans and advances 73.30

Current assets (a) Inventories 5.10 (b) Trade receivables 37.00 (c ) Cash and bank balances 14.10 (d) Short-term loans and advances 108.80 (e) Other current assets 12.00 Total 507.60

Statement of profit and loss Revenue (a) Revenue from operations 831.90 (b) Other income 6.00 Total revenue 837.90 Expenses Direct operational expenses 320.10 Employee benefits expense 49.00 Finance costs 1.10 Depreciation / amortisation expense 87.50 Other expenses 507.80 Total expenses 965.50 Loss before tax (127.60) Tax expenses (1) Current tax 17.50 (2) Deferred tax charge 0.10

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Particulars Period 2012 (`̀ in lakhs)

Loss for the period (145.20) OTHER MATTERS 1. Contingent liabilities 98.00* 2. Capital commitments Nil *amount is not quantifiable in case of joint venture Movement of the aggregate shareholders funds of the joint ventures: Shareholder’s funds as at beginning of the period 423.90 Add: Share of loss for the period (145.20) Effect of disposal of joint ventures (299.00) Shareholder’s funds as at the end of the period (20.30)

Note: Swanston Multiplex Cinemas Private Limited, a Joint Venture of the Company operated a multiplex cinema. The lease of the multiplex cinema has been terminated by the landlord. Considering the termination of the lease, the Company has decided to provide for diminution in the value of investments and advance towards share subscription (share allotted subsequently) given to the Joint Venture amounting to ` 825.06 lakhs.

5. Considering the continuing substantial losses incurred by the Company, its net worth has been substantially reduced. However, having regard to improved operational performance on account of stabilisation of new businesses in films and media services, financial support from its promoters, further restructuring exercise being implemented etc, the financial statements of the Company have been prepared on the basis of going concern and no adjustments are required to the carrying value of assets and liabilities.

6. The shareholders of the Company have approved on February 21, 2012 through postal ballot the resolution to sell or

otherwise dispose of the Company’s whole or part of undertakings pertaining to the Film and Media Services and Exhibition business on a going concern basis to its wholly owned subsidiaries at consideration not less than tax written down values as the board may decide and on such terms and conditions and in such manner as may be decided by the board and the wholly owned subsidiaries. Since necessary approval from lenders and other appropriate authorities are still awaited, the Company has not executed relevant agreements with its subsidiaries. The appropriate accounting treatment / disclosures will be given once the requisite approvals are obtained. Post period end, the Company executed an indicative non-binding term sheet with a private equity fund to acquire a substantial minority stake through an investment of ` 60,500 lakhs in our Company’s film and media services division. The investment is proposed to be made into the subsidiary of our Company, into which our film and media services division will be transferred. No definitive agreement has been executed in respect of the proposed transaction.

7. During the Period 2012, the Company has sold its shareholding in Sri Ramakrishna Theatres Limited (‘SRTL’) comprising of 403,574 equity shares aggregating 89.68% of the issued equity share capital of SRTL, whereupon SRTL has ceased to be subsidiary of the Company

8. During the Period 2012, the Company has sold its shareholding in Cineplex Private Limited (‘CPL’) comprising of

250,000 equity share aggregating 50.00% of the issued equity share capital of CPL, whereupon CPL has ceased to be joint venture of the Company.

9. During the Period 2012, the Company has amicably settled two of its major disputes with landlords in connection with Conducting Agreements signed for acquisition of Exhibition properties. As against the claims of ` 7,030 lakhs, Company has vacated properties on as it where basis for a total consideration of ` 450 lakhs. The carrying cost of capital work in progress net of aforesaid consideration aggregating to ` 2,150 lakhs has been charged off to the Statement of profit and loss.

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10. The Company has entered into a memorandum of understanding granting an option to the third party to purchase assets of the Company having a net block of ` 18,617.00 lakhs as at 31 March 2012 at a price mutually decided. The option to purchase can be exercised at any time till the expiry of the option contract.

II. For Period 2011

1. Lease disclosure under AS 19 – ‘Leases’

The Company is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the terms of the respective agreements. The future minimum lease payments in respect of non-cancellable operating leases are as follows:

Particulars Period 2011

(` in lakhs) Amounts due within one year from the balance sheet date 11,445.10

Amounts due in the period between one year and five years 52,967.90

Amounts due after five years 73,466.30

Total 137,879.30

Amount payable within lock-in-period is ` 81,291.30 lakhs. Amount debited to statement of profit and loss for lease rental is ` 12,527.10 lakhs excluding amount capitalised ` 906.20 lakhs.

2. Mark to Market (MTM) losses on derivative contracts

The Company has assigned the derivative contract pertaining to Interest rate swap for long term loans to a Company (Assignee), who has advised the Company regarding entering into these contracts. The Assignee had advised the Company with regards to entering into these derivative contracts and has indemnified the Company with regards to any mark to market losses that the Company will have to incur on termination of these contracts. Consequently, the total mark to market loss of ` 1,921.40 lakhs has not been recognised by the Company in its statement of profit and loss. For the same reason, the Company has also not recognised a liability for these MTM losses and amounts receivable from the Assignee Company.

3. Interest in Joint ventures

The Company’s interests in jointly controlled entities (incorporated Joint ventures) are:

Name of the Company

Country of Incorporation

% of ownership interest as at 31 March

2011

Swanston Multiplex Cinemas Private Limited India 50%

Cineplex Private Limited India 50%

379

Name of the Company

Country of Incorporation

% of ownership interest as at 31 March

2011

Divyashakti Marketing Private Limited India 50%

Details of Joint ventures

Particulars Period 2011

(`̀ in lakhs)

EQUITY AND LIABILITIES

Shareholders' funds

(a) Share capital 74.00

(b) Reserves and surplus 349.90

Share application money, pending allotment 125.00

LIABILITIES

Non-current liabilities

(a) Long-term borrowings 383.00

(b) Deferred tax liabilities (net) 38.40

(c) Other long-term liabilities 4.30

(d) Long-term provisions 1.00

Current liabilities

(a) Trade payables 103.70

(b) Other current liabilities 48.30

(c) Short-term provisions 80.30

Total 1,207.90

ASSETS

380

Particulars Period 2011

(`̀ in lakhs)

Non-current assets

(a) Fixed assets

(i) Tangible assets (including capital work-in-progress) 761.90

(b) Long-term loans and advances 168.00

Current assets

(a) Current investments 10.40

(b) Inventories 11.80

(c ) Trade receivables 84.60

(d) Cash and bank balances 33.90

(e) Short-term loans and advances 101.10

(f) Other current assets 36.20

Total 1,207.90

Statement of profit and loss

(a) Revenue from operations 1,093.00

(b) Other income 9.30

Total revenue 1,102.30

Expenses

381

Particulars Period 2011

(`̀ in lakhs)

Direct operational expenses 540.10

Employee benefits expense 54.40

Finance costs (net) 14.30

Depreciation / amortisation expense 112.00

Other expenses 419.60

Total expenses 1,140.40

Loss before tax (38.10)

Tax expenses

(1) Current tax 30.30

(2) Deferred tax (credit) (1.00)

Loss for the period (67.40)

OTHER MATTERS

1. Contingent liabilities 116.20*

2. Capital commitments Nil

*amount is not quantifiable in case of joint venture

Movement of the aggregate shareholders funds of the joint ventures:

Shareholder’s funds as at beginning of the period 491.30

Add: Share of loss for the period (67.40)

Shareholder’s funds as at the end of the period 423.90

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4. Foreign currency exposures (other than investments) not covered by forward contracts

Particulars Currency Period 2011 Amount – foreign currency (lakhs)

Amount (` in lakhs)

Trade and other receivables USD 770.80 34,994.80 GBP 51.90 3,778.20 EURO 2.30 149.90 Trade and other payables USD 5.80 262.80 GBP 0.20 11.50 EURO 0.10 4.20 Buyers credit USD 72.30 3,283.90

5. Foreign Currency Convertible Bonds (‘FCCB’)

On 25 January 2006 the Company (‘Issuer’) issued 84,000 Zero Coupon Foreign Currency Convertible Bonds of face value of Euro 1,000 each (‘Bonds’ or ‘FCCB’) aggregating Euro 840 lakhs which were convertible at any time on or after 7 March 2006 and up to the close of the business on 19 January 2011 by the holders of the Bonds (‘the Bondholders’) into newly issued equity shares of the Company with full voting rights with par value of ` 5 each (‘Shares’) at an initial conversion price (as defined in Terms and Conditions of the Bonds) of ` 543.42 per share with a fixed rate of exchange on conversion of ` 54.26=EUR 1.00. The Bonds were listed on the Singapore Exchange Securities Trading Limited (‘SGX ST’). Of the above, bondholders holding bonds of value Euro 633.50 lakhs opted for conversion in Period 2008. During Period 2009, the Company demerged its radio division to Reliance Broadcast Network Limited. As per the terms of FCCB’s issued, the conversion price of the bonds is subject to adjustment and the Company was awaiting a confirmation from the bondholders till the date of redemption. Unless previously redeemed, converted or purchased and cancelled, the bonds will mature on 26 January 2011 at 121.679 per cent of the principal amount.

During Period 2008, the Company classified the liability towards FCCB’s as non–monetary liability inter-alia on the basis of the trend of earnings, movement of the Company's share prices and conversion option exercised by the FCCB holders. On 25 January 2011, the entire FCCB’S outstanding as at 31 March 2010, aggregating to Euro 206.50 lakhs have been redeemed at ` 15,814.20 lakhs (including premium ` 3,085.40 lakhs). Consequently on redemption, foreign exchange loss aggregating to ` 1,489.60 lakhs has been accounted.

(Refer note (c) of B of Annexure IV)

6. The Company's stake in share capital of Sultan Production Private Limited ('Sultan') is in excess of 20%. During Period 2011, the Company has received all the money receivable as per the shareholders agreement and sold the shares. This investment was made by the Company with the intention of investment in the movie "Sultan: The warrior". However, during Period 2010, the Company had issued a letter of termination demanding refund for the moneys paid by the Company and filed a recovery suit against Orcher Studios, as per a shareholders’ agreement signed by the Company which has been agreed to by Orcher Studios. Since, the Company has intention of selling the shares; the Company has decided not to consider Sultan as an associate under AS-18 Related Party Disclosures and AS-23 'Accounting for Associates in Consolidated Financial Statements. The outstanding balance of Sultan Production Private Limited was ` 1,158.80 lakhs as at 31March 2010, of which the Company had considered ` 120.00 lakhs as doubtful in the previous year and provided for the same.

7. During Period 2011, the Company has sold assets of ` 10,417.30 lakhs for ` 13,997.20 lakhs pertaining to the theatrical

exhibition segment and leased them back subsequently. The profit on sale of these assets has been disclosed under the Annexure of other income.

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8. Interest and finance (net) charge includes loss on derivative contract (net) ` 2,166.90 lakhs.

III. For Period 2010 1. Lease disclosure under AS 19 – ‘Leases’

The Company is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the term of the respective agreements.

The future minimum lease payments in respect of non-cancellable operating lease are as follows:

Particulars

Period 2010

(` in lakhs)

Amounts due within one year from the balance sheet date 8,089.60

Amounts due in the period between one year and five years 33,154.40

Amount due after five years 71,712.40

Total 112,956.40

Amount payable within lock-in-period is ` 54,805.40 lakhs

Amount debited to statement of profit and loss for lease rental is ` 8,092.60 lakhs excluding amount capitalised ` 1,071.40 lakhs.

2. Mark to Market (MTM) losses on derivative contracts

The Company has assigned the derivative contracts pertaining to Options for FCCB and interest rate swap for long term loans to a Company (Assignee), who has advised the Company regarding entering into these contracts. The Assignee had advised the Company with regards to entering into these derivative contracts and has indemnified the Company with regards to any mark to market losses that the Company will have to incur on termination of these contracts. Consequently, the total mark to market loss of ` 2,750.40 lakhs has not been recognised by the Company in its statement of profit and loss. For the same reason, the Company has also not recognised a liability for these MTM losses and amounts receivable from the Assignee Company.

3. Interest in Joint ventures

The Company’s interests in jointly controlled entities (incorporated Joint ventures) are:

Name of the Company Country of Incorporation

% of ownership interest as at 31 March 2010

Swanston Multiplex Cinemas Private Limited India 50%

Cineplex Private Limited India 50%

Divyashakti Marketing Private Limited India 50%

Details of Joint ventures

384

Particulars Period 2010 (` in lakhs)

I Assets

1. Fixed assets net block(including Capital work-in-progress) 871.00

2. Current assets, loans and advances

a) Inventories 11.40

b) Sundry debtors 70.50

c) Cash and bank balances 77.80

d) Interest accrued but not due 1.00

e) Loans and advances 277.80

II Liabilities

1. Shareholders' fund 491.30

2. Advance towards share application money 125.00

3. Unsecured loans 456.80

4. Deferred tax liability (net) 39.50

5. Current liabilities and provisions

a) Liabilities 153.90

b) Provisions 43.00

III Income

1. Income from theatrical exhibition (net of duties and taxes) 1,027.30

2. Other Income 36.00

IV Expenses

1. Direct operational expenses 539.70

2. Personnel costs 53.60

3. Other operating and general administrative expenses 348.60

4. Depreciation 111.80

5. Interest 44.40

Loss before tax (34.80)

Provision for tax (including deferred tax) (47.50)

Profit after tax 12.70

V. OTHER MATTERS

1. Contingent liabilities 948.20 2. Capital commitments Nil

Movement of the aggregate shareholders’ funds of the joint ventures: At the beginning of the period 478.60 Add: Share of profits for the period 12.70

At the end of the period 491.30

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4. Foreign currency exposures (other than investments) not covered by forward contracts

Particulars Currency Period 2010

Amount – foreign currency (lakhs)

Amount – (`̀ in lakhs)

Sundry debtors USD 2.60 117.60

GBP 0.10 10.80

Advance from customers USD 0.10 2.20

Sundry creditors USD 1.60 71.40

EURO 0.10 8.00

Loans and advances USD 601.40 27,080.10

GBP 35.70 2,422.90

EURO 1.60 96.50

Buyers credit USD 18.20 817.90

GBP 1.20 78.00

EURO 8.20 496.70

Foreign currency convertible bonds (FCCB) (Refer note (c) of B of Annexure IV)

EURO 206.50 12,511.90

Provision for premium on redemption on FCCB

EURO 44.80 2,712.40

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5. Foreign Currency Convertible Bonds (‘FCCB’) On 25 January 2006 the Company (‘Issuer’) issued 84,000 Zero Coupon Foreign Currency Convertible Bonds of face value of Euro 1,000 each (‘Bonds’ or ‘FCCB’) aggregating Euro 840 lakhs. The Bonds are convertible at any time on or after 7 March 2006 and up to the close of the business on 19 January 2011 by the holders of the Bonds (‘the Bondholders’) into newly issued equity shares of the Company with full voting rights with par value of ` 5 each (‘Shares’) at an initial conversion price (as defined in Terms and Conditions of the Bonds) of ` 543.42 per share with a fixed rate of exchange on conversion of ` 54.26=EUR 1.00. Of the above bondholders holding bonds of value Euro 633.50 lakhs opted for conversion in Period 2008. The balance bond values aggregating to EURO 206.50 lakhs are outstanding as on 31 March 2010. During Period 2009, the Company demerged its radio division to Reliance Broadcast Network Limited (refer note 1 of IV of E of Annexure IV). As per the terms of bond issue, the conversion price of the bonds is subject to adjustment, after agreement with the bondholders. Pending finalisation of agreement, the revised conversion price is not yet decided. Consequently the equity shares issuable on conversion of FCCB - 2,061,884 have been computed based on initial conversion price. The Bonds are listed on the Singapore Exchange Securities Trading Limited (‘SGX ST’). The Bonds may be redeemed, in whole but not in part, at the option of the issuer at any time on or after 25 January 2009 and on or prior to 26 January 2011 subject to satisfaction of certain conditions. Unless previously redeemed, converted or purchased and cancelled, the bonds will mature on 26 January 2011 at 121.679 per cent of the principal amount. The balance in premium account as at 31 March 2010 is as follows:

Period 2010 (`̀ in lakhs)

Opening balance 3,084.79

Adj: foreign exchange fluctuation (372.50)

Closing balance 2,712.29 During Period 2008, the Company classified the liability towards FCCB as non–monetary liability inter-alia on the basis of the trend of earnings, movement of the Company's share prices and conversion option exercised by the FCCB holders. The Company continues to classify the liability towards FCCB as a non–monetary liability as in its view the current fall in the market price of the Company’s share price and non-conversion by bond holders is a temporary aberration. Further, pursuant to Scheme of Arrangement for demerger of the Radio business, the conversion price is subject to adjustment, after agreement with bond holders. The Company estimates that there will be significant adjustments to conversion price considering the value of Radio business which has demerged. Consequently, the foreign exchange fluctuation (gain) / loss for Period 2010 aggregating to ` (1,718.10) lakhs has not been recognised by management. Cumulative loss not recognised due to classification of FCCB as a non-monetary liability is ` 1,272.20 lakhs in respect of outstanding FCCB's. Unrecognised losses on FCCB's which were converted into equity shares in earlier periods is ` 2,199.50 lakhs.

(Refer note (c) of B of Annexure IV for subsequent recognition of FCCB’s as a monetary item)

6. The Company's stake in share capital of Sultan Production Private Limited ('Sultan') is in excess of 20%. This investment was made by the Company with the intention of investment in the movie "Sultan: The warrior". However, during Period 2010, the Company has issued a letter of termination demanding refund for the moneys paid by the Company and filed a recovery suit against Orcher Studios, as per a shareholders’ agreement signed by the Company which has been agreed to by Orcher Studios.

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Since, the Company has intention of selling the shares; the Company has decided not to consider Sultan as an associate under AS-18 ‘Related Party Disclosures’ and AS-23 'Accounting for Associates in Consolidated Financials Statements’.

The outstanding balance of Sultan Production Private Limited is ` 1,158.80 lakhs of which the Company has considered ` 120.00 lakhs as doubtful in the current year and provided for the same.

7. Interest and finance charges (net) include loss on derivative transactions (net) of ` 3,539.20 lakhs.

IV. For Period 2009 1. Demerger of the Radio business of the Company to Reliance Broadcast Network Limited The Board of the Company in their meeting held on 25 October 2008 approved a Scheme of Arrangement (‘the Radio Scheme’) between Reliance Broadcast Network Limited (‘RBNL’), a wholly owned subsidiary and the Company for the de-merger of the Radio business (constituting the Radio segment) of the Company into RBNL. The shareholders of the Company accorded their approval in a court convened meeting of members of the Company held on 22 January 2009. The Radio Scheme was approved by the Hon’ble High Court of Judicature at Bombay vide its order dated 4 April 2009 and filed with the Registrar of Companies (‘ROC’) on 30 June 2009, as required under Section 391(3) of the Act after obtaining approval from the Ministry of Information and Broadcasting (‘MIB’) for vesting of radio licenses held by the Company in the name of RBNL. As per the Radio Scheme, the Radio business of the Company stands transferred to RBNL with effect from 1 April 2008, the Appointed Date and has been given effect to on 30 June 2009, being the Effective Date and the accounting treatment prescribed by the Radio Scheme has been given effect to in the financial statements for Period 2009. All the assets and liabilities, directly allocable and as mutually determined by the Board of Directors of RBNL and the Company, of the Radio business as at 1 April 2008 have been transferred at their respective book values. Further, general borrowings of the Company as on 1 April 2008 have been allocated between the Company and RBNL on the basis of ratio of total assets of the Company immediately before giving effect of the Radio Scheme. In consideration of the demerger, RBNL will allot equity shares of ` 5 each in the ratio of 1:1 and upon issue of shares as above the Company’s investment in shares of RBNL will stand cancelled. As per the provisions of the Radio Scheme, excess balances of assets transferred over liabilities and the cost of investments in RBNL cancelled has been debited to Securities premium reserve as follows:

Particulars Amount (`̀ in lakhs)

Assets of Radio business as of 1 April 2008 transferred as per the provisions of the Radio Scheme 44,929.50

Liabilities of Radio business as of 1 April 2008 transferred as per the provisions of the Radio Scheme (6,831.50)

General borrowings of the Company as of 1 April 2008 allocated between RBNL (Radio Business) and the Company as per the provisions of the Radio Scheme (22,400.00)

Excess of net assets transferred to RBNL (Radio business) 15,698.00 Cancellation of investment in RBNL 1,010.00 Total amount debited to Securities premium reserve as per the provisions of the Radio Scheme 16,708.00

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The Radio business has been held / carried on in trust for the period 1 April 2008 till the Effective Date by the Company. Accordingly, the Company has charged interest, at an agreed rate on the amount receivable as at the appointed date and subsequent funding till the Effective Date. The total receivable ` 26,095.00 lakhs (includes interest ` 2,584.90 lakhs) has been disclosed as a recoverable from RBNL. However, for Period 2009 financial statements, pending allotment of shares by RBNL, the investment has been cancelled to give effect to the substance of the Radio Scheme as approved by the Hon’ble High Court of Judicature at Bombay and RBNL ceases to be a subsidiary for Period 2009 financial statements. 2. Scheme for merger of wholly owned subsidiaries with the Company

The Board of the Company in their meeting held on 30 January 2009 approved the Scheme of Amalgamation (‘Amalgamation Scheme’) of the Company (‘Transferee’) with its wholly owned subsidiaries Adlabs Multiplexes and Theatres Limited (‘AMTL’), Adlabs Multiplex Limited (‘AML’), Mahimna Entertainment Private Limited (‘MEPL’) and Rave Entertainment Private Limited (‘REPL’) (collectively referred to as the Transferor Companies). The Amalgamation Scheme was approved by the Hon’ble High Court of Judicature at Bombay vide its order dated 8 May 2009 and filed with the Registrar of Companies (‘ROC’) on 29 May 2009, as required under Section 391(3) of the Act.

AMTL, AML, and REPL are engaged in the exhibition business and have been included in the theatrical exhibition segment. MEPL has been included in the unallocated corporate segment.

As per the Amalgamation Scheme, AMTL, AML, MEPL and REPL amalgamated with the Company with effect from 1 April 2008, the Appointed Date and has been given effect to on 29 May 2009, being the Effective Date and the accounting treatment prescribed by the Amalgamation Scheme has been given effect to in the financial statements for Period 2009.

In accordance with the requirements of the Amalgamation Scheme, the credit aggregating ` 5,826.20 lakhs to Capital reserve has been arrived at as follows:

All assets and liabilities of the Transferor companies as at 1 April 2008 which have been identified by the Board of Directors have been recorded at their respective fair values (as determined based on valuation reports from Government approved valuer / management estimates) as on 31 March 2009. Investments in the equity shares of the Transferor companies as appearing in the books of the Transferee Company as at 31 March 2009 have been cancelled. The excess of net assets of the transferor companies taken over at fair value (as determined on 31 March 2009) over the cost of investment in these companies, aggregating ` 3,605.80 lakhs has been credited to Capital reserve.

The Company has recorded an increase in the value of its assets based on revaluation of certain assets of the Company pertaining to the theatrical exhibition and film production services business. The total increase in value of assets of the Company is ` 17,890.10 lakhs, based on revaluation reports obtained from Government approved external valuers. The Company has also reduced the value of its assets by ` 15,669.70 lakhs (Fixed assets and intangible rights ` 3,989.50 lakhs, Debtors ` 2,050.70 lakhs, Loans and advances including capital advances ` 6,188.50 lakhs and Investments ` 3,441.00 lakhs). The net increase in the value of assets of the Company ` 2,220.40 lakhs has been credited to Capital reserve pursuant to the provisions of the Amalgamation Scheme.

The authorised share capital of the Transferor Companies was considered as authorised share capital of the Transferee Company. Hence, the authorised share capital of the Company has been increased by ` 1,602.90 lakhs divided into 32,058,000 shares of ` 5 each. The above mentioned accounting treatment is in accordance with the Amalgamation Scheme, had the Company followed accounting treatment prescribed by AS – 14 “Accounting for Amalgamations” / Indian GAAP:

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The excess of investments over net assets acquired by the Company amounting to ` 1,939.10 lakhs would have been transferred to Goodwill and would have been amortised over 5 years.

The appreciation in the value of the Company’s assets aggregating ` 17,890.10 lakhs would have been credited to the Revaluation reserve instead of being credited to the Capital reserve.

The diminution in the value of the Company’s assets aggregating ` 15,669.70 lakhs would have been debited to the statement of profit and loss instead of Capital reserve. Accordingly, had the Amalgamation Scheme as referred above been accounted for as per the requirements of AS – 14 “Accounting for Amalgamations” / Indian GAAP, the loss for the year would be higher by ` 16,057.60 lakhs, capital reserve would have been lower ` 281.20 lakhs, revaluation reserve would have been higher by ` 17,890.10 and balance of Goodwill would have been ` 1,551.30 lakhs.

3. Lease disclosure under AS 19 – ‘Leases’ The Company is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the terms of the respective agreements. The future minimum lease payments in respect of non-cancellable operating leases are as follows:

Particulars Period 2009 (`̀ in lakhs)

Amounts due within one year from the balance sheet date 6,724.30 Amounts due in the period between one year and five years 27,988.70 Amounts due after five years 71,374.40 Total 106,087.40

Amount payable within lock-in-period is ` 39,398.00 lakhs Amount debited to statement of profit and loss for lease rental is ` 6,440.60 lakhs excluding amount capitalised ` 1,244.10 lakhs.

4. Mark to Market (MTM) losses on derivative contracts

The Company has assigned the derivative contracts pertaining to Options for FCCB and Interest rate swap for long term loans to a Company (‘Assignee’), who has advised the Company regarding entering into these contracts. The Assignee had advised the Company with regards to entering into these derivative contracts and has indemnified the Company with regards to any mark to market losses that the Company will have to incur on termination of these contracts. Consequently, the total mark to market loss of `14,037.00 lakhs have not been recognised by the Company in its statement of profit and loss.

For the same reason, the Company has also not recognised a liability for these MTM losses and amounts receivable from the Assignee Company.

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5. Interest in Joint ventures The Company’s interests in jointly controlled entities (incorporated Joint ventures) are:

Name of the Company Country of Incorporation % of ownership interest as at 31

March 2009 Swanston Multiplex Cinemas Private Limited India 50% Cineplex Private Limited India 50% Divyashakti Marketing Private Limited India 50%

Details of Joint ventures

Period 2009 (`̀ in lakhs)

I Assets 1. Fixed assets (including Capital work-in-progress) 964.20 2. Current assets, loans and advances a) Inventories 11.20 b) Sundry debtors 53.70 c) Cash and bank balances 82.00 d) Interest accrued but not due 0.60 e) Loans and advances 115.00 II Liabilities 1. Shareholders' fund 478.60 2. Unsecured loans 506.80 3. Deferred tax (net) 55.70 4. Current liabilities and provisions a) Liabilities 159.30 b) Provisions 26.30 III Income 1. Sales (net of duties and taxes) 1,186.70 2. Other income 92.00 IV Expenses 1. Operating expenses 956.80 2. Depreciation 109.70 3. Interest - Profit before tax 212.20 Provision for tax (including deferred tax) 51.50 Profit after tax 160.70

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Period 2009 (`̀ in lakhs)

V. Other matters 1. Contingent liabilities 1,016.10 2. Capital commitments Nil Movement of the aggregate shareholders’ funds of the joint ventures: At the beginning of the period 404.90 Add: Share of profits for the period 160.70 Less: Dividend declared during the period (87.00) At the end of the period 478.60

6. Foreign currency exposures (other than investments) not covered by forward contracts

Particulars Currency Period 2009

Amount – Foreign currency (lakhs)

Amount (`̀ in lakhs)

Sundry debtors USD 18.20 948.30 GBP 1.70 124.40 EURO 0.20 10.60 Sundry creditors USD 3.80 200.40 GBP 0.10 4.00 EURO 0.10 3.50 Loans and advances USD 333.00 17,375.30 GBP 4.40 327.40 EURO 0.60 40.80 Buyers credit USD 5.30 276.60 GBP 1.20 85.30 EURO 8.20 564.90 Foreign Currency Convertible Bonds (‘FCCB’) (Refer note (c) of B of Annexure IV)

EURO 206.50 14,230.00

Provision for premium on redemption of FCCB EURO 44.80 3,084.80

7. Foreign Currency Convertible Bonds (‘FCCB’)

On 25 January 2006 the Company (‘Issuer’) issued Zero Coupon Foreign Currency Convertible Bonds (‘Bonds’ or ‘FCCB’) aggregating Euro 840 lakhs. The Bonds are convertible at any time on or after 7 March 2006 and up to the close of the business on 19 January 2011 by the holders of the Bonds (‘the Bondholders’) into newly issued equity shares of the Company with full voting rights with par value of ` 5 each (‘Shares’) at an initial conversion price (as

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defined in Terms and Conditions of the Bonds) of ` 543.42 per share with a fixed rate of exchange on conversion of ` 54.26=EUR 1.00. Of the above bondholders holding bonds of value Euro 633.50 lakhs opted for conversion in the Period 2008. The balance bondholders holding bonds of value aggregating to Euro 206.50 lakhs have not opted for conversion and are outstanding as on 31 March 2009. During Period 2009, pursuant to the Scheme of Arrangement for demerger of Radio business, the conversion price is subject to adjusted after agreement with the bondholders and the Company. Pending finalisation of agreement, the revised conversion price is not yet decided. Consequently the equity shares issuable on conversion of FCCB have been computed based on initial conversion price. The Bonds are listed on the Singapore Exchange Securities Trading Limited (‘SGX-ST’).

The Bonds may be redeemed, in whole but not in part, at the option of the issuer at any time on or after 25 January 2009 and on or prior to 26 January 2011 subject to satisfaction of certain conditions. Unless previously redeemed, converted or purchased and cancelled, the bonds will mature on 26 January 2011 at 121.679 per cent of the principal amount.

The balance in premium account as at 31 March 2009 is as follows:

Period 2009 (`̀ in lakhs)

Opening balance 2,839.89 Add: foreign exchange fluctuation 244.90 Closing balance 3,084.79

During Period 2008, the Company re-classified the liability towards Foreign Currency Convertible Bonds ('FCCB') as non–monetary liability inter-alia on the basis of the trend of earnings, movement of the Company's share prices and conversion option exercised by the FCCB holders. The Company continues to classify the liability towards FCCB as a non–monetary liability as in its view the current fall in the market price of the Company’s share price and non-conversion by bond holders is a temporary aberration. Consequently, the foreign exchange fluctuation loss for the Period 2009 aggregating to ` 1,130.10 lakhs has not been recognised by the management. Cumulative loss not recognised due to classification of FCCB as a non-monetary liability is ` 2,990.40 lakhs in respect of outstanding FCCB's. Unrecognised losses on FCCB's which were converted into equity shares in earlier periods is ` 2,199.50 lakhs. (Refer note (c) of B of Annexure IV for subsequent recognition of FCCB’s a monetary liability)

8. Impairment Disclosure

During the Period 2009, the Company has impaired certain fixed assets pertaining to the theatrical exhibition segment on the basis of determination of value in use of each property, which the Company considers as the relevant Cash Generating Unit (‘CGU’) for the purpose of impairment testing. The Company has considered a discount rate of 11.68%. The amount of impairment loss of ` 551.70 lakhs has been debited to the Capital reserve pursuant to Scheme of Amalgamation.

(Refer note 2 of IV of E of Annexure IV)

9. Interest and finance (net) charge includes loss on derivative contract (net) ` 4,864.90 lakhs.

V. For Period 2008

1. Modified Composite Scheme of Amalgamation and Arrangement The Board of the Company at their meeting held 23 April 2006 approved the Composite Scheme of Amalgamation and Arrangement (the ‘Composite Scheme’) between the Company, Entertainment One India Limited (‘E-ONE’), Adlabs Multiplexes and Theatres Limited (‘AMTL’) and Reliance Broadcast Network Limited (‘RBNL’). The shareholders of

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the Company accorded their approval to the Scheme at the Annual General Meeting on 29 July 2006. The Composite Scheme was approved by the Hon'ble High Court of Judicature at Bombay vide its order dated 15 September 2006. The Composite Scheme inter-alia provided for the following:

the amalgamation of E-ONE with the Company effective 1 April 2005; the merger of the digital business of AMTL with the Company effective 1 April 2005; and the demerger of the radio business of the Company to RBNL effective 31 March 2006.

The Company had made an application to the Ministry of Information and Broadcasting for vesting of Radio licenses held by it in the name of RBNL. Pending the said approval, the Composite Scheme was not filed with the Registrar of Companies ('ROC') as required under Section 391(3) of the Companies Act, 1956 ('the Act'). However, for the purpose of the Period 2007 financial statements, pending completion of licensing and other procedural formalities, the Composite Scheme was given effect to in view of the Court approval and to give effect to the substance of the Composite Scheme as approved by the Hon'ble High Court of Judicature at Bombay. In accordance with the requirements of the Composite Scheme, the merger of E-ONE as well as the digital business of AMTL and the demerger of the Radio business of the Company was accounted for as follows:

All assets and liabilities of E-ONE as at 1 April 2005 were recorded by the Company at their fair values. Since E-ONE was a wholly owned subsidiary of the Company, the investment by the Company in the shares of E-ONE was cancelled against the assets and liabilities acquired on amalgamation. The excess of net assets taken (at fair value) over the cost of investment in E-ONE amounting to ` 272.58 lakhs was credited to 'Amounts pending transfer to the Securities premium account and / or General reserve account as per the Composite Scheme of Amalgamation and Arrangement'.

All assets and liabilities of the digital business of AMTL as at 1 April 2005 were recorded by the Company at their book values. Since AMTL was a wholly owned subsidiary of the Company, no consideration was paid against the assets and liabilities acquired. The excess of liabilities over the assets taken over (at book value) amounting to ` 44.69 lakhs was debited to 'Amounts pending transfer to the Securities premium account and / or General reserve account as per the Composite Scheme of Amalgamation and Arrangement'.

All assets and liabilities of the Radio business of the Company as at 31 March 2006 were transferred at their

respective book values. The aggregate value of net assets transferred pursuant to the Composite Scheme in excess of ` 10,000.00 lakhs (which was recorded as receivable from RBNL) was recorded in 'Amounts pending transfer to the Securities premium account and / or General reserve account as per the Composite Scheme of Amalgamation and Arrangement'

Subsequently during the current period, the Board modified the aforesaid Composite Scheme vide circular mode pursuant to Section 289 of the Companies Act, 1956 on 13 February 2008. The Modified Composite Scheme of amalgamation and arrangement (the ‘Modified Scheme’) between the Company, E-ONE and AMTL was approved by the Hon'ble High Court of Judicature at Bombay vide its order dated 7 March 2008 and was filed with the ROC as required under Section 391(3) of the Companies Act, 1956 ('the Act') on 31 March 2008.The Modified Scheme inter-alia provides for the following:

the amalgamation of E-ONE with the Company effective 1 April 2005; the merger of the digital business of AMTL with the Company effective 1 April 2005; and adjusting the net results of the transactions related to Radio business from 31 March 2006 till the Effective

Date in the General reserve account of the Company. As the Composite Scheme was primarily modified in relation to the Radio business, in respect of amalgamation of E-

ONE and merger of digital business of AMTL, these were already given effect to in the financial statements of Period 2007. Accordingly, no further adjustments are made in the Period 2008 financial statements, except that the amounts which were not credited / debited to 'Securities premium' / 'General reserve account ' pending filing the Composite Scheme with ROC have now been debited / credited to Securities premium / General reserve account as applicable on the filing of the Modified Scheme with the ROC.

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During the Period upto 31 March 2008, E-ONE and AMTL carried on their existing business in trust for and on behalf of the Company. All vouchers, deeds, licenses, agreements, loan documents, etc are in the name of E-ONE and AMTL. The tile deeds, licenses, agreements, loan documents, etc are being transferred in the name of the Company.

As regards the Radio business, the provision relating to demerger of the Radio business of the Company to RBNL effective 31 March 2006 as provided in the Composite Scheme and given effect to in Period 2007 financial statements have been deleted in the Modified Scheme. Accordingly, all the adjustments effected in the Period 2007 financial statements in this regard have been reversed during the Period 2008. Further, in accordance with the Modified Scheme, the net results of the transactions related to Radio business for the period from 31 March 2006 till the Effective Date (i.e. 31 March 2008) have been debited to General reserve account of the Company.

The net results of the transactions related to Radio business for the period from 31 March 2006 up to 31 March 2008 are summarised hereunder:

Particulars Period 2008 `̀ in lakhs

Period 2007 `̀ in lakhs

Income 11,160.90 3,320.30 Expenditure Direct costs 5,062.10 2,024.60 Personnel costs 3,477.60 2,528.10 Other operating and general administrative expenses * 5,584.10 4,547.60 Interest 1,346.30 2,119.90 Depreciation / amortisation 2,396.60 1,474.80 Loss before tax (6,705.80) (9,374.70) Tax expenses - fringe benefit tax 114.90 75.50 Loss after tax (A) (6,820.70) (B) (9,450.20) Total (A + B) (16,270.90) Tax effect of the above 1,907.60 Balance transferred to General reserve account 14,363.30 * includes ` 785.80 lakhs (Period 2007: ` 2,086.70 lakhs, since reversed) being interest etc. allocated / charged in Period 2007 by Company to the radio business on net funds utilised in carrying on the Radio business. For deviation to the accounting treatment recommended in the standard refer note 3 of V of E of Annexure IV.

2. Acquisition of Rave Entertainment Private Limited ('REPL') On 31 May 2007, the Company entered into a Share Purchase Agreement ('SPA') with the shareholders of Rave Entertainment Private Limited ('REPL'), a company engaged inter-alia in the business of owning and operating multiplexes, for acquisition of 100% stake in that company. One of the conditions precedents to the SPA was the approval by the Hon'ble High Court of Judicature at Allahabad of the Scheme of demerger filed by REPL for demerger of Kanpur properties. Pending approval of the Scheme of demerger by the said Court, the shares of REPL were held in Escrow and the consideration of ` 500 lakhs was disclosed under loans and advances in Period 2007 financial statements. On 12 December 2007, the Hon'ble High Court of Judicature at Allahabad approved the said Scheme of demerger. Consequently, REPL is now a wholly owned subsidiary of the Company and the amounts placed in Escrow and those disclosed under loans and advances have been adjusted as per the terms of the SPA. 3. Acquisition of Katch 22 Entertainment Private Limited ('Katch 22')

On 23 April 2007, the Company acquired 100% stake in Katch 22, a company engaged in the production and distribution of films. Subsequently, pursuant to the Board of Directors' approval vide resolution dated 26 April 2007;

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the Company had filed the Scheme of Amalgamation of Katch 22 ('the Katch 22 Scheme') with the Hon'ble High Court of Judicature at Bombay for the merger of Katch 22 with the Company effective 1 April 2006. The Katch 22 Scheme was approved by the Hon'ble High Court of Judicature at Bombay vide its order dated 14 September 2007 and filed with the ROC on 9 October 2007. The Katch 22 Scheme inter-alia provides for the amalgamation of Katch 22 Entertainment Private Limited with the Company effective 1 April 2006. In accordance with the requirements of the Katch 22 Scheme, the merger of Katch 22 with the Company has been accounted for as follows:

As per the Katch 22 Scheme, Katch 22 amalgamates with the Company retrospectively from 1 April 2006, the Appointed Date. All assets and liabilities of Katch 22 as at 1 April 2006 have been recorded by the Company at their fair values. Since Katch 22 was a wholly owned subsidiary of the Company, the investment by the Company in the shares of Katch 22 has been cancelled against the assets and liabilities acquired on amalgamation. The excess of net assets taken over at fair value (as determined on the Effective Date i.e. 9 October 2007) over the cost of investment in Katch 22 amounting to ` 201.80 lakhs has been credited to General reserve account.

The Company has also recorded the reduction of ` 2,000.00 lakhs in the value of its assets (debtors, unamortised rights and loans and advances) by debit to 'General reserve account' as per the provisions of the Katch 22 Scheme.

The net results of the transactions relating to Katch from 1 April 2006 up to the Effective Date are as follows:

Particulars For the period from 1 July 2007 to 8 October

2007 (`̀ in lakhs) Period 2007 (`̀ in lakhs)

Sales and service (net) - 701.90 Other income 23.30 - Total revenue 23.30 701.90 Direct costs - 1,691.30 Other operating and general administrative expenses 0.20 0.10 Interest - 131.60 Profit before tax 23.10 (1,121.10) Tax expenses - - Profit after tax 23.10 (1,121.10) Impact of Schemes referred to in notes 1 of V of E of Annexure IV and 3 of V of E of Annexure IV: Had the Company followed the accounting treatment prescribed by AS-14 / generally accepted accounting principles in India:

` 201.80 lakhs arising from the merger of Katch 22 with the Company and credited to the General reserve account would have been credited to Capital reserve account;

Reduction of ` 2,000.00 lakhs in value of the Company's assets would have been debited to the statement of profit and loss instead of General reserve account;

` 2,086.70 lakhs being interest on monies advances by the Company to the Radio business would have been reversed in the statement of profit and loss as against the reversal in the General reserve account, and

The net results / (loss) of the transactions related to Radio business from 31 March 2006 up to the Effective Date i.e. 31 March 2008 aggregating to ` 14,363.30 lakhs (net of tax benefits) arising from modification in the Scheme of demerger of Radio business and debited to the General reserve account would have been debited to statement of profit and loss.

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Accordingly, had the Modified Scheme been accounted for in compliance with the requirements of AS 14 / generally accepted accounting principles in India, the profit for the period before tax would have been lower by ` 18,450.00 lakhs, General reserve account would have been higher by ` 18,248.20 lakhs and Capital reserve account would have been stated at ` 201.80 lakhs.

4. Lease disclosure under AS 19 – ‘Leases’ The Company is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the terms of the respective agreements. The future minimum lease payments in respect of non-cancellable operating leases are as follows:

Particulars Period 2008 (`̀ in lakhs)

Amounts due within one year from the balance sheet date 4,607.80 Amounts due in the period between one year and five years 18,978.80 Amounts due after five years 53,463.80 Total 77,050.40

Amount payable within lock-in-period is ` 38,309.40 lakhs. Amount debited to statement of profit and loss for lease rental is ` 2,593.50 lakhs. 5. Interest in Joint ventures

Name of the Company Country of

incorporation % of ownership interest as

at 31 March 2008

Swanston Multiplex Cinemas Private Limited India 50.00%

Adlabs Multiplex Limited (Became subsidiary with effect from 20 December 2007)

India -

Cineplex Private Limited India 50.00% Divyashakti Marketing Private Limited India 50.00%

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Details of Joint ventures

Particulars Period 2008

(`̀ in lakhs) I. Assets

1. Fixed assets (including Capital work-in-progress) 1,063.80

2. Investments 56.40

3. Current assets, loans and advances

a) Inventories 8.50

b) Sundry debtors 88.40

c) Cash and bank balances 69.30

d) Interest accrued but not due 0.50

e) Loans and advances 73.50

II. Liabilities

1. Shareholders' fund 478.90

2. Unsecured loans 634.60

3. Deferred tax (net) 54.10

4. Current liabilities and provisions

a) Liabilities 179.60

b) Provisions 13.20

III. Income

1. Sales (net of duties and taxes) 1,024.10

2. Other income 102.80

IV. Expenses

1. Operating expenses 911.30

2. Depreciation 102.10

3. Interest 0.60

4. Profit before tax 112.90

5. Prior period adjustments (0.40)

6. Provision for tax 30.00

7. Profit after tax 83.30

V. Other Matters

1. Contingent liabilities 2,032.20

2. Capital commitments -

Movement of the aggregate shareholders’ funds of the joint ventures:

At the beginning of the period 497.10

Add: Share of losses for the period (18.20)

At the end of the period 478.90

398

6. Foreign currency exposures (other than investments) not covered by forward contracts

Particulars Currency Period 2008

Amount – Foreign currency (lakhs) Amount

(` in lakhs)

Sundry debtors USD 4.60 184.40

GBP 3.10 246.30

Euro 0.10 6.50

Sundry creditors USD 40.80 1,636.10

GBP 1.60 129.90

Euro 8.20 520.20

Loans and advances USD 21.60 865.80

Euro 7.00 444.20

Foreign Currency Convertible Bonds (‘FCCB’) (Refer note (c) of B Annexure IV)

Euro 206.50 13,099.90

Provision for premium on redemption of FCCB Euro 44.80 2,899.90

7. Foreign Currency Convertible Bonds (‘FCCB’) On 25 January 2006 the Company ('Issuer') issued Zero Coupon Foreign Currency Convertible Bonds ('Bonds' or 'FCCB') aggregating Euro 840 lakhs. The Bonds are convertible at any time on or after 7 March 2006 and up to the close of the business on 19 January 2011 by the holders of the Bonds ('the Bondholders') into newly issued equity shares of the Company with full voting rights with par value of ` 5 each ('Shares') at an initial conversion price (as defined in Terms and Conditions of the Bonds) of ` 543.42 per share with a fixed rate of exchange on conversion of ` 54.26=EUR 1.00. The conversion price is subject to adjustment in certain circumstances. The Bonds are listed on the Singapore Exchange Securities Trading Limited ('SGX-ST'). The Bonds may be redeemed, in whole but not in part, at the option of the Issuer at any time on or after 25 January 2009 and on or prior to 26 January 2011 subject to satisfaction of certain conditions. Unless previously redeemed, converted or purchased and cancelled, the bonds will mature on 26 January 2011 at 121.679 per cent of the principal amount.

399

During Period 2008, bond holders holding bonds aggregating Euro 633.50 lakhs have opted to convert the bonds to equity shares. Accordingly shares aggregating to 6,325,420 have been issued to them at a price of ` 543.42 per share (including securities premium of ` 538.42 per share). The balance in premium account as at 31 March 2008 is as follows:

Period 2008 (`̀ in lakhs)

Opening balance 10,006.59 Add: Reversal of provision for premium on conversion of FCCB (7,858.20) Add: foreign exchange fluctuation 691.50 Closing balance 2,839.89

* Premium payable on redemption of FCCB ` 9,880.90 lakhs has been fully provided for and has been charged to securities premium reserve. During Period 2008, Bond holders holding bonds aggregating Euro 633.50 lakhs have opted to convert their bonds into equity shares. During Period 2008, FCCBs have been reclassified as non-monetary liabilities pursuant to inter-alia the current trend of earnings and market price of the Company's equity share exceeding the conversion price stipulated in the offer document (bondholders holding 75.42% of the FCCB have exercised conversion option up to 31 March 2008). Consequently, the foreign exchange fluctuation loss aggregating to ` 438.10 lakhs accounted in Period 2007 and year ended 31 March 2006 has been reversed during the period in the statement of profit and loss and foreign exchange fluctuation loss of ` 3,621.80 lakhs for the financial period has not been recognised in the statement of profit and loss. (Refer (c) of B of Annexure IV for subsequent consideration of FCCB as a monetary liability)

VI. For Period 2007

1. Composite Scheme of amalgamation and arrangement

The Board of Directors of the Company at their meeting held on 22 April 2006 approved the Composite Scheme of Amalgamation and Arrangement (the ‘Composite Scheme’) between the Company, Entertainment One India Limited (‘E-ONE), Adlabs Multiplexes and Theatres Limited (‘AMTL’) and Reliance Broadcast Network Limited (‘RBNL’). The shareholders of the Company accorded their approval to the Composite Scheme in terms of the Companies Act, 1956 (the ‘Act’) at the Annual General Meeting on 29 July 2006. The Composite Scheme was approved by the Hon’ble High Court of Judicature at Bombay vide its order dated 15 September 2006. The Composite Scheme interalia provides for the following: the amalgamation of E-ONE with the Company effective 1 April 2005; the merger of the digital business of AMTL with the Company effective 1 April 2005; and the demerger of the radio business of the Company to RBNL effective 31 March 2006.

The Company had made an application to the Ministry of Information and Broadcasting for vesting of radio licenses held by it in the name of RBNL. Pending the said approval, the Composite Scheme had not been filed with the Registrar of Companies (ROC) as required under section 391(3) of the Act. However, for the purpose of Period 2007 financial statements, pending completion of licensing and other procedural formalities, the Composite Scheme had been given effect to in view of the Court approval and to give effect to the substance of the Composite Scheme as approved by the Hon’ble High Court of Judicature at Bombay. In accordance with the requirements of the Composite Scheme, the merger of E-ONE as well as the digital business of AMTL and the demerger of the Radio business of the Company had been accounted for as follows: Amalgamation of E-ONE with the Company with effect from 1 April 2005

400

As per the Scheme, E-ONE amalgamates with the Company retrospectively from 1 April 2005, the Appointed Date. All assets and liabilities of E-ONE as at 1 April 2005 have been recorded by the Company at their fair values. Since E-ONE was a wholly owned subsidiary of the Company, the investment by the Company in the shares of E-ONE have been cancelled against the assets and liabilities acquired on amalgamation. The excess of net assets taken over (at fair value) over the cost of investment in E-ONE amounting to ` 272.58 lakhs has been credited to ‘Amounts pending transfer to the Securities premium reserve and / or General reserve as per the Scheme of Amalgamation and Arrangement’. On the filing of the Scheme with the ROC, the amount will be credited to General reserve as per the requirements of the Composite Scheme. The statement of profit and loss for Period 2007 also includes the (loss) of E-ONE for the period from 1 April 2005 to 31 March 2006 as per the financial statements of E-ONE for that period which were audited by a firm of Chartered Accountants other than B S R & Co. The details of the income and expenses comprising the net loss are given below. Merger of the digital business of AMTL with the Company with effect from 1 April 2005

As per the Scheme, the digital business of AMTL merges with the Company retrospectively from 1 April 2005, the Appointed Date. All assets and liabilities of the digital business of AMTL as at 1 April 2005 have been recorded by the Company at their book values. Since AMTL is a wholly owned subsidiary of the Company, no consideration has been paid against the assets and liabilities acquired. The excess of liabilities over the assets taken over (at book value) amounting to ` 44.69 lakhs has been debited to ‘Amounts pending transfer to the Securities premium reserve and / or General reserve as per the Scheme of Amalgamation and Arrangement’. On the filing of the Scheme with the ROC, the amount will be debited to Securities premium reserve as per the requirements of the Composite Scheme. The statement of profit and loss for Period 2007 also includes the net (loss) of the digital business of AMTL for the period from 1 April 2005 to 31 March 2006 as per the financial statements of AMTL for that period which were audited by a firm of Chartered Accountants other than B S R & Co. The details of the income and expenses comprising the net loss are given below. Demerger of the Radio business of the Company to RBNL with effect from 31 March 2006

As per the Scheme, the Radio business of the Company stands transferred to RBNL with effect from 31 March 2006, the Appointed Date. All assets and liabilities of the Radio business of the Company as at 31 March 2006 have been transferred at their respective book values. In consideration of the demerger of the Radio business, RBNL will pay ` 10,000.00 lakhs to the Company and allot shares to the existing shareholders of the Company as per the Composite Scheme. The aggregate value of net assets to be transferred pursuant to the Composite Scheme in excess of ` 10,000.00 lakhs (which is recorded as receivable from RBNL) has been recorded in ‘Amounts pending transfer to the Securities premium reserve and / or General reserve as per the Scheme of Amalgamation and Arrangement’. On the filing of the Scheme with the ROC, the amount will be debited to Securities premium reserve as per the requirements of the Composite Scheme. The details of the income, expenses, assets and liabilities of the Radio business not included in these financial statements are given below. To facilitate the demerger, the Company has cancelled its investment in RBNL with a corresponding debit to

‘Amounts pending transfer to the Securities premium reserve and / or General reserve as per the Scheme of Amalgamation and Arrangement’. On the filing of the Composite Scheme with the ROC, this amount will be debited to Securities premium reserve.

The Company has also recorded reduction of ` 2,050.25 lakhs in value of its assets (debtors and loans and advances) by debit to ‘Amounts pending transfer to the Securities premium reserve and / or General reserve as per the Scheme of Amalgamation and Arrangement’. On the filing of the Composite Scheme with the ROC, this amount will be debited to Securities premium reserve.

The above is in conformity with accounting treatment prescribed by the Composite Scheme (except that pending filing of the Composite Scheme with the ROC, the relevant adjustments required to be made to Securities premium reserve / General reserves account have been recorded in ‘Amounts pending transfer to the Securities premium reserve and / or General reserves account as per the Composite Scheme of Amalgamation and Arrangement’).

401

The provision for taxation has been calculated by management on the basis of these financial statements including the effect of the Composite Scheme. However, the Company’s actual tax liability for the tax financial year ended 31 March 2007 and thereafter would be determined based on the status of filing of the Composite Scheme. Had the Company followed the accounting treatment prescribed by AS-14 / generally accepted accounting principles in India: ` 272.58 lakhs arising from the merger of E-ONE with the Company and credited to the General reserve would

have been credited to Capital reserve account; ` 44.69 lakhs arising from the merger of digital business of AMTL and debited to the Securities premium reserve

would have been debited to Goodwill; ` 7,960.39 lakhs arising on demerger of Radio business and debited to the Securities premium reserve would have

been debited to the statement of profit and loss; the loss of ` 5.00 lakhs on cancellation of investment of the Company in RBNL would have been debited to the

statement of profit and loss instead of the Securities premium reserve; and reduction of ` 2,050.25 lakhs in value of the Company’s assets would have been debited to the statement of profit

and loss instead of the Securities premium reserve. Accordingly, had the Composite Scheme been accounted for in compliance with the requirements of AS 14 / generally accepted accounting principles in India, the profit for the period before tax would have been lower by ` 10,015.64 lakhs, General reserve would have been lower by ` 272.58 lakhs, Capital reserves account would have been stated at ` 272.58 lakhs, Securities premium would have been higher by ` 10,060.33 lakhs and Goodwill would have been stated at ` 44.69 lakhs.

During Period 2007, as E-ONE and AMTL carried on their existing business in trust for and on behalf of the Company, all vouchers, documents etc. for the period are in the name of E-ONE and MADEL. The title deeds, licenses, agreements, loan documents etc., are being transferred in the name of the Company.

The net results for the Period of E-ONE and digital business of AMTL included in these financial statements comprises:

E-ONE AMTL Period 2007

(`̀ in lakhs) Year ended 31

March 2006 (`̀ in lakhs)

Period 2007 (` in lakhs)

Year ended 31 March 2006 (`̀ in lakhs)

Sales and services (net) 62.12 206.54 55.88 183.85 Other income 0.09 0.42 69.22 2.16 Total revenue 62.21 206.96 125.10 186.01 Cost of sales and services - - 44.86 61.52 Personnel costs 3.65 53.47 2.87 5.75 Depreciation and amortisations 2.78 4.15 71.64 73.77 Interest expenses 13.20 62.57 - - Other costs 23.92 255.62 20.47 56.09 Profit / (loss) before tax 18.66 (168.85) (14.74) (11.12) Current tax - - - - Fringe benefit tax - 2.10 - - Deferred tax - 13.12 - - Net profit / (loss) after tax 18.66 (184.07) (14.74) (11.12)

During Period 2007, the Company carried on the Radio business in trust for and on behalf of RBNL. The amount of revenue and expenses for Period 2007 and the assets and liabilities as at 30 June 2007 relating to the demerged Radio

402

business and which, pursuant to the Court approved Composite Scheme, have not been recognised in these financial statements are as under:

Period 2007 (`̀ in lakhs)

Income 3,320.30 Expenditure* 12,695.00 Fringe benefit tax 75.50 (Loss) after tax (9,450.20) Fixed assets ** 29,451.69 Current assets 4,530.21 Current liabilities 41,432.10 Loans 2,000.00

* - includes ` 2,086.68 lakhs being interest charged by the Company on net funds utilised in carrying on the Radio business in trust for and on behalf of RBNL. Also, ` 347.40 lakhs being interest on loan taken by the Company from RBNL has not been considered above as the said loan has been considered as repayment towards funding by the Company of the Radio business.

**- represents the gross value of the fixed assets of the Radio business, i.e. prior to giving effect to the adjustment of ` 7,960.39 lakhs as per the Composite Scheme.

Accounting policies specific to the Radio business are as under:

Intangible assets and amortisation One Time Entry Fees paid for acquiring new licenses has been capitalised as an asset and is amortised over a period of ten years, being the period of the license, from the date of operationalisation of the station.

Revenue recognition Revenue from radio broadcasting is recognised on an accrual basis on the airing of customer's commercials.

License fees As per the new Frequency Module (FM) broadcasting policy, effective 1 April 2005 license fees are charged to revenue at the rate of 4% of gross revenue for the period or 10% of Reserve One Time Entry Fee (ROTEF) for the concerned city, whichever is higher. Gross revenue for this purpose shall mean revenue on the basis of billing rates inclusive of any taxes and without deduction of any discount given to the advertiser and any commission paid to advertising agencies. Barter advertising contracts shall also be included in the gross revenue on the basis of relevant billing rates. ROTEF means 25% of highest valid bid in the city.

As the Composite Scheme has been given effect to, the aggregate of the Company's qualifying loans and advances and investments is in excess of the limits prescribed under Section 372A of the Act and for which prior approval of the shareholders has not been obtained. These financial statements do not include adjustments, if any, that would be required should the shareholders not accord their approval.

Further, the Company has raised money by way of issue of FCCB on 25 January 2006. The Company had utilised ` 6,502.82 lakhs from the proceeds of the issue towards the said Radio business till 31 March 2006. With effect from the Appointed Date i.e. 31 March 2006, the remaining proceeds will be utilised by the Company to fund the Radio business in RBNL. During Period 2007, the Company has utilised ` 10,128.00 lakhs for the Radio business on behalf of RBNL and has charged interest from RBNL for the funds so utilised

2. Acquisition of Rave Entertainment Private Limited (‘REPL’)

403

On 31 May 2007, the Company entered into a Share Purchase Agreement ('SPA') with the shareholders of Rave Entertainment Private Limited ('REPL'), a company engaged inter-alia in the business of owning and operating multiplexes, for acquisition of 100% stake in that company. One of the conditions precedent to the SPA is the approval by the Hon'ble High Court of Judicature at Allahabad of the Scheme of demerger filed by REPL for demerger of Kanpur properties. Pending approval of the Scheme of demerger by the said Court, the shares of REPL are held in Escrow and the consideration of ` 500.00 lakhs has been disclosed under loans and advances. The Company has also placed ` 2,550.00 lakhs in escrow, which amount will be adjusted in future as per the terms of the conducting agreement.

3. Acquisition of Katch 22 Entertainment Private Limited (‘Katch 22’)

During Period 2007, the Company acquired 100% stake in Katch 22 Entertainment Private Limited. Subsequently, pursuant to the board of directors approval vide resolution dated 26 April 2007, the Company filed a Scheme of amalgamation of Katch 22 with the Hon’ble High Court of Judicature at Bombay for the merger of Katch 22 Entertainment Private Limited with the Company effective 1 April 2006. The said Scheme is pending approval of the Court and hence has not been given effect to in these financial statements.

4. Lease disclosure under AS 19 – ‘Leases’ The Company is obligated under non-cancellable leases primarily for theatre and office premises and equipments which are renewable thereafter as per the terms of the respective agreements. The future minimum lease payments in respect of non-cancellable operating leases are as follows:

Particulars Period 2007 (`̀ in lakhs)

Amounts due within one year from the balance sheet date 1,710.25 Amounts due in the period between one year and five years 7,032.58 Amounts due after five years 6,216.76 Total 14,959.59

Amount debited to statement of profit and loss for lease rental is ` 1,866.72 lakhs.

5. Interest in Joint ventures

Name of the Company Country of incorporation % of Ownership Interest as at 30 June

2007

Swanston Multiplex Cinemas Private Limited India 50.00%

Adlabs Multiplex Limited India 50.00%

Cineplex Private Limited India 50.00%

Divya Shakti Marketing Private Limited India 50.00%

404

Details of Joint ventures

Particulars Period 2007 (`̀ in lakhs)

I Assets

1. Fixed assets (including Capital work-in-progress) 1,789.22 2. Investments 78.59 3. Current assets, loans and advances

a) Inventories 14.02 b) Sundry debtors 104.37 c) Cash and bank balances 104.71 d) Interest accrued but not due 0.54 e) Loans and advances 358.00 II Liabilities 1. Shareholders’ fund 1,093.28 2. Secured loans Nil 3. Unsecured loans 682.11 4. Deferred tax (net) 120.44 5. Current liabilities and provisions a) Liabilities 323.16 b) Provisions 230.46 III. Income 1. Sales (net of duties and taxes) 2,191.01 2. Other Income 22.28 IV. Expenses 1. Operating expenses 1,553.86 2. Depreciation 177.81 3. Interest 8.35 4. Profit before Taxa 473.27 5. Prior period Adjustments 14.68 6. Provision for taxation 177.89 7. Short provision for previous year Nil 8. Profit after Taxation before minority interests 280.70 9. Net Profit 280.70 V. OTHER MATTERS 1. Contingent liabilities 1,016.09

2. Capital commitments -

405

Particulars Period 2007 (`̀ in lakhs)

Movement of the aggregate shareholders’ funds of the joint ventures: As at the beginning of the period 595.66 Add: Share of profit for the period 497.62 As at the end of the period 1,093.28

6. Foreign currency exposures (other than investments) not covered by forward contracts

Particulars Currency Period 2007

Foreign Currency

(Amount in lakhs)

Amount

(` in lakhs)

Sundry debtors USD 18.78 759.24

GBP 0.47 36.22

Euro 0.07 3.65

Sundry creditors USD 6.60 268.96

Foreign currency convertible bonds (‘FCCB’) (Refer note (c) of B of Annexure IV)

Euro 84.00 46,158.00

Premium on conversion of FCCB Euro 18.21 10,006.60

7. Foreign Currency Convertible Bonds (‘FCCB’) On 25 January 2006 the Company (‘Issuer’) issued Zero Coupon Foreign Currency Convertible Bonds (‘Bonds’ or ‘FCCB’) aggregating Euro 840 lakhs. The Bonds are convertible at any time on or after 7 March 2006 and up to the close of the business on 19 January 2011 by the holders of the Bonds (‘the Bondholders’) into newly issued equity shares of the Company with full voting rights with par value of ` 5 each (‘Shares’) at an initial conversion price (as defined in Terms and Conditions of the Bonds) of ` 543.42 per share with a fixed rate of exchange on conversion of ` 54.26=EUR 1.00. The conversion price is subject to adjustment in certain circumstances. The Bonds are listed on the Singapore Exchange Securities Trading Limited (‘SGXST’). The Bonds may be redeemed, in whole but not in part, at the option of the Issuer at any time on or after 25 January 2009 and on or prior to 26 January 2011 subject to satisfaction of certain conditions. Unless previously redeemed, converted or purchased and cancelled, the bonds will mature on 26 January 2011 at 121.679 per cent of the principal amount. As at 30 June 2007, there has been no conversion of the Bonds into Shares.

406

Premium on redemption of FCCB

Period 2007 (`̀ in lakhs)

Opening balance 9,880.94 Add: foreign exchange fluctuation 125.65 Closing balance 10,006.59

* Premium payable on redemption of FCCB ` 9,880.94 lakhs has been fully provided for and has been charged to securities premium reserve. In the event that the conversion option is exercised by the holders of FCCB in the future, the amount of premium charged to the securities premium reserve will be suitably adjusted in the respective years. (Refer note (c) of B of Annexure IV)

407

Annexure V

Reliance MediaWorks Limited 10 Statement of share capital of the Company

(` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Authorised

Equity shares of ` 5/-each 4,000.00 5,000.00 5,000.00 4,602.90 3,000.00 3,000.00

Preference shares of ` 5/-each 1,000.00 - - - - -

5,000.00 5,000.00 5,000.00 4,602.90 3,000.00 3,000.00

Issued, subscribed and paid-up capital

Equity shares of ` 5/- each, fully paid-up 2,306.30 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04

10 % redeemable non convertible non cumulative preference shares (Preference shares) of ` 5/- each, fully paid-up 147.50 - - - - -

2,453.80 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04

(refer notes (a) to (h) below)

(a) Reconciliation of the shares outstanding at the commencement and at the end of the period As at

31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Equity shares

No of Shares No of Shares No of Shares No of Shares No of Shares No of

Shares (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs)

At the commencem 461.26 461.26 461.26 461.26 398.00 398.00

408

Annexure V

Reliance MediaWorks Limited 10 Statement of share capital of the Company

(` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 ent of the period

Share issued during the period - - - - 63.26 -

At end of the period 461.26 461.26 461.26 461.26 461.26 398.00

Preference shares

No of Shares No of Shares No of Shares No of Shares No of Shares No of

Shares (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs)

At the commencement of the period - - - - - -

Share issued during the period 29.50 - - - - -

At end of the period 29.50 - - - - -

(b) Rights, preferences and restriction attached to equity shares

The Company has only one class of equity shares having par value of ` 5 per share. Each equity holder is entitled to one vote per share. The Company declares and pays dividends, if any, in Indian Rupees. The dividend proposed, if any by the Board of the Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

(c) Rights, preferences and restriction attached to Preference share

Preference shares shall be redeemed at the end of 20 years from the date of allotment i.e. each Preference shares shall be redeemed at a premium calculated in a manner that gives the holder an yield of 10% p.a. (till date of redemption ) on issue price of ` 1,000 (including premium of ` 995) after deduction of dividend, if any declared during the tenure. However, the premium on redemption will be paid only to the original subscribers or to the transferees if the transfers have been previously approved by the Company. Further early redemption at the option of holder of Preference shares can be done, at issue price plus yield as mentioned above, at any time after the date of allotment by giving not less than two months advance notice to the Company. Early redemption at the option of Company at the applicable redemption price can be done, any time after the date of allotment by giving not less than 30 days notice to the Preference share holder.

409

Annexure V

Reliance MediaWorks Limited 10 Statement of share capital of the Company

(` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

(d) Names of shareholders holding more than 5% of equity share in the Company

As at

No of Shares No of Shares No of Shares No of Shares No of Shares No of

Shares (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs)

Reliance Land Private Limited 206.00 206.00 206.00 206.00 206.00 206.00

Reliance Capital Limited 85.29 81.05 81.05 29.55 - -

AAA Entertainment Private Limited - - - 48.00 48.00 -

Bhupati Consultancy Services Private Limited - - - - - 48.00

Mr. Manmohan Shetty - - - - - 22.91

% holding in

the class % holding in

the class % holding in

the class % holding in

the class % holding in

the class % holding in the class

Reliance Land Private Limited 44.66% 44.66% 44.66% 44.66% 44.66% 51.76%

Reliance Capital Limited 18.49% 17.57% 17.57% 6.41%

AAA Entertainment Private Limited - - - 10.40% 10.40% - Bhupati Consultancy Services Private Limited - - - - - 12.06%

410

Annexure V

Reliance MediaWorks Limited 10 Statement of share capital of the Company

(` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

Mr. Manmohan Shetty - - - - - 5.76%

(e)

Names of shareholders holding more than 5% of Preference share in the Company

No of Shares No of Shares No of Shares No of Shares No of Shares No of

Shares (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs) (In lakhs)

Reliance Infocomm Engineering Private Limited 12.00 - - - - -

Reliance Utility Engineers Private Limited 17.50 - - - - -

% holding in

the class % holding in

the class % holding in

the class % holding in

the class % holding in

the class % holding in the class

Reliance Infocomm Engineering Private Limited 40.68% N.A. N.A. N.A. N.A. N.A

Reliance Utility Engineers Private Limited 59.32% N.A. N.A. N.A. N.A. N.A.

.

411

Annexure V

Reliance MediaWorks Limited 10 Statement of share capital of the Company

(` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 (f)

Pursuant to shareholder approval dated 30 March 2012, the authorised share capital of the Company was reclassified from 1,000 lakh equity shares of ` 5 each to 800 lakh equity shares of ` 5 each and 200 lakh preference shares of ` 5 each.

(g) During Period 2009, the authorised share capital of the Company has been increased as per the provisions of Scheme of

Amalgamation by ` 1,602.90 lakhs divided into 32,058,000 shares of ` 5 each. (refer note 2of IV of E of Annexure IV) (h)

During the Period 2008, bond holders holding bonds aggregating EURO 633.50 lakhs have opted to convert their bonds to equity shares. Accordingly, equity shares aggregating to 63.26 lakhs have been issued to them at a price of ` 543.42 per share (including securities premium of ` 538.42).

412

Annexure VI

Reliance MediaWorks Limited 10

Summary statement of reserves and surplus of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

a) Securities premium reserve

At the commencement of the period 46,817.45 47,190.56 46,818.06 63,770.96 24,537.54 24,663.19

Less : Provision for premium on redemption of Zero Coupon Foreign Currency Convertible Bonds ('FCCB') (Also refer note (c) of B of Annexure IV) - (373.11) 372.50 (244.90) (691.50) (125.65)

Add : On issuance of equity shares pursuant to conversion of FCCB’s - - - - 34,161.66 -

Add : Premium on issuance of preference shares 29,352.50 -

Add : Reversal of provision for premium on FCCB converted during the period (Also refer note (c) of B of Annexure IV) - - - - 7,858.20 -

Less : Adjustment pursuant to Modified Composite Scheme of Amalgamation and Arrangement (Refer note1 of IV of E of Annexure IV) - - - - (2,094.94) -

Less: Adjustment pursuant to Scheme of Arrangement for demerger of Radio business (refer note 1 of IV of E of Annexure IV) - - - (16,708.00) - -

76,169.95 46,817.45 47,190.56 46,818.06 63,770.96 24,537.54 b) General reserve At the commencement 1,195.08 1,195.08 1,195.08 1,195.08 5,584.00 4,730.00

of the period

Add : Transfer from Statement of profit and loss - - - - 11,500.00 854.00

413

Annexure VI

Reliance MediaWorks Limited 10

Summary statement of reserves and surplus of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

Add : Transfer on account of Scheme of Amalgamation of Katch 22 (Refer note 3 of V of E of Annexure IV) - - - - 201.80 -

Less : Reduction in value of Companies assets pursuant to Scheme of Amalgamation of Katch 22 Refer note 3 of V of E of Annexure IV) - - - - (2,000.00) -

Less : Net result of the transactions relating to Radio business adjusted pursuant to Modified Composite Scheme of Amalgamation and Arrangement (Refer note 1 of V of E of Annexure IV) - - - - (14,363.30) -

Add : Adjustment pursuant to Modified Scheme of Amalgamation and Arrangement (Refer note 1 of V of E of Annexure IV) - - - - 272.58 -

1,195.08 1,195.08 1,195.08 1,195.08 1,195.08 5,584.00 c) Capital reserve

At the commencement of the period 5,826.20 5,826.20 5,826.20 - -

Amounts transferred to Capital reserve as per provisions of the Scheme of Amalgamation (Refer note 1 of IV of E of - - - 5,826.20 - - Annexure IV)

5,826.20 5,826.20 5,826.20 5,826.20 - -

d) Foreign currency translation reserve

At the commencement of the period (625.59) (682.50) 532.30 - - -

Add: Foreign currency translation gain / (loss) on non-integral operations (net) 3,325.80 56.91 (1,214.80) 532.30 - -

2,700.21 (625.59) (682.50) 532.30 - -

414

Annexure VI

Reliance MediaWorks Limited 10

Summary statement of reserves and surplus of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 e) Amount pending

transfer to the Securities premium reserve and / or the General reserve as per the Composite Scheme of Amalgamation and Arrangement (Refer note 1 of V of E of Annexure IV and note 1 of VI of E of Annexure IV )

i) Pending transfer to

Securities premium reserve

At the commencement of the period - - - - (10,060.33) -

On demerger of Radio business - - - - - (7,965.39)

On reduction in value of Company's assets - - - - - (2,050.25)

On merger of digital business of AMTL - - - - - (44.69)

Reversal due to the Modified Scheme of Amalgamation and Arrangement - - - - 7,965.39 -

Transfer to Securities premium reserve - - - - 2,094.94 -

- - - - - (10,060.33) ii) Pending transfer to

General reserve

At the commencement of the period - - - - 272.58 -

On merger of E-ONE transfer to General Reserve - - - - (272.58) 272.58

Transfer to General reserve - - - - - 272.58

f) (Deficit) / Surplus in

Statement of profit and loss

At the commencement of the period (38,713.28) (14,365.28) (5,568.28) (631.27) 10,361.56 2,712.14

415

Annexure VI

Reliance MediaWorks Limited 10

Summary statement of reserves and surplus of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

(Loss) / Profit for the period, as per Statement of profit and loss (45,850.80) (24,348.00) (8,797.00) (4,937.01) 1,856.37 9,667.54

Appropriations

Transfer to general reserve - - - - (11,500.00) (854.00)

Proposed dividend - - - - (1,153.15) (995.02) Dividend tax - - - - (196.05) (169.10)

(84,564.08) (38,713.28) (14,365.28) (5,568.28) (631.27) 10,361.56 Total 1,327.36 14,499.86 39,164.06 48,803.36 64,334.77 30,695.35

The above statement should be read with significant accounting policies and notes to summary statements of the Company, as restated (Annexure IV)65502.1

416

Annexure VII

Reliance MediaWorks Limited

Statement of non-current investment, deferred tax assets (net), long-term loans and advances and other non-current assets of the Company

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

A Non-current

investments

I Investment in equity

instruments

Subsidiary companies (non-trade, unquoted and at cost)

A Reliance MediaWorks

Theatres Limited 5.00 5.00 5.00 5.00 5.00 5.00

B Reliance MediaWorks

Films (UK) Limited 8.47 8.47 8.47 8.47 8.47 8.47

C Reliance MediaWorks

(USA) Inc. 9.21 9.21 9.21 9.21 9.21 9.21

D Reliance MediaWorks

(Netherlands) B.V. 10.40 10.40 10.40 10.40 10.40 -

E Reliance MediaWorks

(Mauritius) Limited 0.01 0.01 0.01 0.01 0.01 0.01

F Big Synergy Media

Limited 641.55 641.55 641.55 641.55 641.55 641.55

G Rave Entertainment and Food (Nepal) Private Limited 60.00 60.00 60.00 60.00

H Sri Ramakrishna Theatres Limited (refer note 7 of I of E of Annexure IV) - 442.10 442.10 442.10

I Reliance MediaWorks Entertainment Services Limited 2,005.00 2,005.00 5.00

J

Reliance Lowry Digital Imaging Services Inc. (This investment constitute 10% of the outstanding shares and balance 90% of the outstanding shares are held by Reliance MediaWorks (USA), Inc., a wholly owned subsidiary of the 3,000.00 3,000.00 3,000.00

417

Annexure VII

Reliance MediaWorks Limited

Statement of non-current investment, deferred tax assets (net), long-term loans and advances and other non-current assets of the Company

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Company)

K Reliance Media Consultant Private Limited 1.00 - -

L Rave Entertainment Private Limited (refer note 2 of IV of E of Annexure IV for merger of the subsidiary with the Company) 515.30

M Reliance Broadcast Networks Limited (refer note1 of IV of E of Annexure IV for Scheme of Arrangement for demerger of Radio business) 1,010.00

N Adlabs Multiplex Limited (refer note 2 of IV of E of Annexure IV for merger of the subsidiary with the Company) 1,753.50

O Adlabs Multiplex and Theatres Limited (refer note 2 of IV of E of Annexure IV for merger of the subsidiary with the Company) 5.00 5.00

P Katch 22 Entertainment Private Limited (refer note 3 of V of E of Annexure IV for merger of the subsidiary with the Company) - 1.00

Joint Ventures (non-trade, unquoted at cost)

A Cineplex Private Limited (refer note 8 of I of E of Annexure IV) - 25.00 25.00 25.00 25.00 25.00

B Divyashakti Marketing

Private limited 329.00 329.00 329.00 329.00 329.00 329.00

C Adlabs Multiplex Limited (refer note 2 of IV of E of Annexure IV for merger of the 49.05

418

Annexure VII

Reliance MediaWorks Limited

Statement of non-current investment, deferred tax assets (net), long-term loans and advances and other non-current assets of the Company

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 subsidiary with the

Company)

D Swanston Multiplex Cinemas Private Limited (refer note 4 of I of E of Annexure IV) 700.06 700.06 700.06 700.06 700.06 700.06

Less: Provision for diminution in value of long-term investments (700.06)

Others (non-trade,

unquoted at cost)

A Sultan Production Private Limited (refer note 6 of II of E of Annexure IV) 1.00 1.00 1.00

Others (non-trade,

quoted at cost) A Prime Focus Limited 466.58

6,069.64 7,235.80 5,236.80 2,231.80 5,013.50 2,239.93

II Investment in partnership firm (non-trade, unquoted at cost)

A HPE / Adlabs LP (Investment in limited 1,999.30 1,999.30 1,999.30 2,241.00 4,607.75 4,607.75

partnership) (2009 and 2010 : ` 2,366.80 lakhs towards recovery of principal pursuant to a contract and 2010: ` 241.70 lakhs has been repaid by the Partnership firm as principal)

Less: Provision for diminution in value of long term investments (refer note 2 of IV of E of Annexure IV) (1,999.30) (1,999.30) (1,999.30) (2,241.00) - -

- - - - 4,607.75 4,607.75

III Investment in preference shares (non-trade, unquoted at cost)

419

Annexure VII

Reliance MediaWorks Limited

Statement of non-current investment, deferred tax assets (net), long-term loans and advances and other non-current assets of the Company

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

A Tree of Knowledge DOT

Com Private Limited.# - - - 1,200.00 1,200.00 1,200.00

Less: Provision for diminution in value of long term investments (refer note 2 of IV of E of Annexure IV) (1,200.00)

Reliance MediaWorks

Services Limited 12,000.00 - - - - -

# These shares have been forfeited during Period 2010 12,000.00 - - - 1,200.00 1,200.00

IV

Investment in Government securities (trade, unquoted and at cost)

Government securities

National savings certificates 32.50 32.50 112.60 102.70 98.20 97.80

(pledged with State government 32.50 32.50 112.60 102.70 98.20 97.80 authorities)

Total 18,102.14 7,268.30 5,349.40 2,334.50 10,919.45 8,145.48

Aggregate value of unquoted investments

20,801.50

9,267.60

7,348.70

5,775.50

10,919.45

8,145.48

Aggregate provision for diminution in value of investments 2,699.36 1,999.30 1,999.30 3,441.00 - -

B Deferred tax asset

Arising on account of timing difference in:

Provision for leave encashment and gratuity 201.10 272.80 127.90 126.40 207.30 76.89

Others 1,733.70 547.50 79.30 583.30 186.10 110.54

Unabsorbed depreciation allowance and carried forward business loss * 1,816.00 3,108.90 2,215.00 1,093.90 1,894.30 -

3,750.80 3,929.20 2,422.20 1,803.60 2,287.70 187.43 Deferred tax liability

Arising on account of timing difference in:

420

Annexure VII

Reliance MediaWorks Limited

Statement of non-current investment, deferred tax assets (net), long-term loans and advances and other non-current assets of the Company

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

Depreciation/ amortisation 3,750.80 3,929.20 2,422.20 1,803.60 2,287.70 1,473.61

3,750.80 3,929.20 2,422.20 1,803.60 2,287.70 1,473.61

Net deferred tax assets / liabilities - - - - - (1,286.18)

* Restricted to the extent of deferred tax liability due to absence of virtual certainty

C Long-term loans and advances

- Unsecured, considered good

I Capital advances 511.50 1,483.80 2,577.50 1,776.90 9,613.49 1,202.98

II Security deposits 14,115.80 16,053.70 16,354.50 16,116.50 14,559.40 5,505.46

III Capital advance to related party 83.10 - -

IV Loans to others 304.50 206.20 266.11 320.00 385.30

V Advance tax, tax deducted at source, advance fringe benefit tax (net of provision for tax Period 2012 - ` 595.20, Period 2011 - ` 594.50, Period 2010 – ` 594.10, Period 2009 4,392.76, Period 2008 - ` 4,097.08, Period 2007 - ` 2,333.10) 2,471.40 3,647.00 5,319.80 4,171.14 3,354.42 2,075.20

VI Advance towards

investment 5,000.00 5,000.00 - - - VII Others* 1,675.00 935.00 1,130.95 1,485.00 1,044.52 - 24,161.30 27,325.70 25,648.86 23,869.54 28,957.13 8,783.64

*Prepaid expenses and entertainment tax paid under protest etc.

D Other non-current assets

I Interest accrued but not due 22.17 49.00 52.50 49.10 33.44 115.14

II Gratuity 9.80

421

Annexure VII

Reliance MediaWorks Limited

Statement of non-current investment, deferred tax assets (net), long-term loans and advances and other non-current assets of the Company

(` in lakhs) As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007

III Balance with bank - Margin money deposit* 29.90 231.50 224.92 10.31 10.31 5,002.61

52.07 290.30 277.42 59.41 43.75 5,117.75

* Margin money deposits are under bank lien for guarantees given by the Company

The above statement should be read with significant accounting policies and notes to summary statements of the Company, as restated (Annexure IV)

Notes: 1. The list of parties related to directors/ promoters are as follows:

Particulars 31 March 2012

31 March 2011

31 March 2010

31 March 2009

31 March 2008

30 June 2007

Loans, advances and other receivables

KGS Developers Limited 63.00 263.00 563.00 563.00 563.00 - Total 63.00 263.00 563.00 563.00 563.00 -

2. Above data excludes amounts due from parties related to the issuer Company, which has been disclosed in

Annexure XVIII as part of related party disclosures. 3. As per para (21) (B)(IX) Part A Schedule VIII of SEBI ICDR Regulations, Company shall disclose in the offer

document whether any of the receivable are related to directors or promoters or the issuer in any way. In absence of clarification on “related to the directors or promoters”, Company has disclosed amounts due from relatives of directors as defined in Schedule IA of the Companies Act, 1956 and in case of promoters, amount due from “Promoter Group” and “Group Companies” as defined in SEBI ICDR Regulation. The List of persons / entities classified as “Promoter Group” and “Group Companies” has been determined by the Group and relied upon by the Auditors. 4. Refer note 2 of IV of E of Annexure IV, note 1 of V of E of Annexure IV and note 3 of V of E of Annexure IV for advances written off pursuant to Schemes.

422

10 Annexure VIII

Reliance MediaWorks Limited

Statement of current assets of the Company (` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June 2007 A Current investments I Investment in mutual

fund (non-trade, unquoted and at lower of cost and fair value)

Investment in mutual funds - - 7,902.40 - 13,500.30 19.81

- - 7,902.40 - 13,500.30 19.81 Market value of

current investment - - 7,906.70 - 13,500.30 19.81 B Inventories (valued at lower cost

and net realisable value) (refer note 6 of A of Annexure IV)

I Stores and spares 401.10 357.30 293.90 283.30 44.80 31.86 II Chemical stock 30.00 20.70 16.50 33.50 17.20 25.87 III Food and beverages 235.80 303.50 238.60 146.90 53.30 42.24 IV Raw films 41.30 43.00 47.80 54.60 58.80 61.55 V Content not aired - - - - 17.70 - 708.20 724.50 596.80 518.30 191.80 161.52 C Trade receivables Unsecured,

considered good; I

Debts outstanding for a period exceeding six months from the date they are due for 14,052.00

14,758.90

13,159.70

15,216.30 1,756.20 141.28

payments Other debts 3,728.50 3,983.00 8,959.40 4,986.10 9,883.90 5,897.37

17,780.50 18,741.90 22,119.10 20,202.40 11,640.10 6,038.65 Unsecured,

considered doubtful;

423

10 Annexure VIII

Reliance MediaWorks Limited

Statement of current assets of the Company (` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June 2007 II Debts outstanding for a

period exceeding six months from the date they are due for payments 1,935.10 681.20 1.90 - 206.60 -

Other debts - - 93.80 - 1,935.10 681.20 1.90 - 300.40 - Less: Provision for

doubtful debts 1,935.10 681.20 1.90 - 300.40 - - - - - - - 17,780.50 18,741.90 22,119.10 20,202.40 11,640.10 6,038.65 D Cash and bank

balances Cash and cash

equivalents I Balances with banks - in current accounts 706.00 3,034.50 1,368.30 1,129.00 1,911.60 1,860.68 - in fixed deposit

account with original maturity less than three months - - - 186.25 - -

II Cash on hand 259.70 166.60 85.20 55.80 77.50 120.79 Foreign Currency

denominated preloaded cards 6.06

965.70 3,201.10 1,453.50 1,371.05 1,989.10 1,987.53 III Other bank balances - in dividend accounts 10.50 12.20 13.80 14.60 8.20 6.77 - in escrow account 2,550.00 - in fixed deposit

account maturing with in a year 1.50 10.70 - - - 3,400.00

- in margin money deposit maturing 4,626.70 5,537.80 3,047.87 2,672.28 5,145.99 136.49

with in a year* 4,638.70 5,560.70 3,061.67 2,686.88 5,154.19 6,093.26 5,604.40 8,761.80 4,515.17 4,057.93 7,143.29 8,080.79

424

10 Annexure VIII

Reliance MediaWorks Limited

Statement of current assets of the Company (` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June 2007

*Margin money deposits are under bank lien for guarantees given by the Company

E Short-term loans and

advances - Unsecured,

considered good I Amount due from

Reliance Broadcast Networks Limited pursuant to demerger of Radio business 6,095.00 6,095.00 26,095.00 26,095.00 - -

II Loans and advances to related parties

- subsidiaries 48,724.60 49,844.90 35,877.00 17,729.80 7,622.80 425.16 - joint ventures 192.60 391.10 399.20 565.70 706.20 788.09 - Advance towards

share application money in a Joint venture - Swanston Multiplex Cinemas Private Limited - 125.00 125.00 -

III Loans to others 910.90 1,285.80 1,136.69 528.40 13,566.90 34,052.94 IV Deposits 542.70 - - - - V Others * 2,211.10 4,071.80 6,837.60 5,908.30 9,603.78 5,605.33 58,676.90 61,813.60 70,470.49 50,827.20 31,499.68 40,871.52 - Unsecured,

considered doubtful I Loans to others 193.00 - - II Others* 1,032.00 978.90 120.00 65.80 III Loans and advances to

related parties - Advance towards share application money in a Joint 125.00 -

venture - Swanston Multiplex Cinemas Private Limited

Less: Provision for doubtful advances 1,350.00 978.90 120.00 65.80

425

10 Annexure VIII

Reliance MediaWorks Limited

Statement of current assets of the Company (` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June 2007 - - - - - - 58,676.90 61,813.60 70,470.49 50,827.20 31,499.68 40,871.52 *includes service tax

credit, prepaid expenses, employee advance, advances to vendors etc.

F Other current assets I Unbilled revenue 217.00 177.30 217.00 125.10 - - II Interest accrued and

due from Reliance Broadcast Network Limited

4,507.00 3,930.20 2,481.60 - -

III Interest accrued but not due 29.60 157.70 66.87 89.58 783.86 85.75

IV Other receivables for sale of investment / Right to investment - - - 4,066.80 3,127.30 -

4,753.60 4,265.20 2,765.47 4,281.48 3,911.16 85.75 The above statement should be read with significant accounting policies and notes to summary statements, as restated (Annexure IV) Notes: 1. The list of parties related to directors / promoters (as per SEBI ICDR Regulations, 2009) are as follows:

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June 2007 Trade receivables Reliance Capital Limited 31.65 37.40 43.42 1.63 - -

Reliance Capital Asset Management Limited 10.00 32.29 4.38 0.26 - - Gini & Jony Apparel Private Limited - 1.23 0.03 0.56 - - TV Today Network Limited - 0.09 - - - - Reliance Equity Advisors (India) Limited 0.31 - - - - - Reliance Broadcast Network Limited 1,376.70 1,376.70 1,337.90 - - - Reliance Life Insurance Company Limited 5.33 0.92 - - - - Loans, advances and other receivables

426

10 Annexure VIII

Reliance MediaWorks Limited

Statement of current assets of the Company (` in lakhs)

Particulars

As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June 2007 Reliance Broadcast Network Limited 10,741.74 10,025.20 28,749.80 26,095.00 - - Reliance Securities Limited - - - - 3,126.90 - Reliance Life Insurance Company Limited 9.00 9.00 9.00 20.00 - -

Total 12,174.73 11,482.83 30,144.53 26,117.45 3,126.90 -

2. Above data excludes amounts due from parties related to the issuer Company, which has been disclosed in

Annexure XVIII as part of related party disclosures. 3. As per para (21) (B)(IX) Part A Schedule VIII of SEBI ICDR Regulations, Company shall disclose in the offer

document whether any of the receivable are related to directors or promoters or the issuer in any way. In absence of clarification on “related to the directors or promoters”, Company has disclosed amounts due from relatives of directors as defined in Schedule IA of the Companies Act, 1956 and in case of promoters, amount due from “Promoter Group” and “Group Companies” as defined in SEBI ICDR Regulation. The List of persons / entities classified as “Promoter Group” and “Group Companies” has been determined by the Group and relied upon by the Auditors.

4. Refer note 2 of IV of E of Annexure IV, note 1 of V of E of Annexure IV and note 3 of V of E of Annexure IV for receivables and advances written off pursuant to Schemes.

427

Annexure IX

Reliance MediaWorks Limited 10

Statement of non-current liabilities of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 A Long-term borrowings I Non convertible

debentures (secured) 35,000.00 - - - - - II Term loans - From banks (secured) 22,437.50 32,370.80 36,416.70 40,000.00 37,500.00 - - From banks

(unsecured) - 7,500.00 - - Others (secured) 2,500.00 0.40 III Zero Coupon Foreign

Currency Convertible Bonds ('FCCB') - - - 14,230.00 13,099.90 46,158.00

57,437.50 39,870.80 36,416.70 54,230.00 53,099.90 46,158.40 B Other long-term

liabilities I Lease rent liability as per

AS 19 - "Leases" 4,622.80 2,449.05 1,265.86 787.30 342.98 244.96 II Security deposit 129.20 123.14 49.30 51.80 - - III Advance from related

party 217.50 362.50 507.50 - - - 4,969.50 2,934.69 1,822.66 839.10 342.98 244.96 C Long-term provisions I Leave encashment 496.50 695.90 344.50 342.50 162.56 170.99 II Gratuity 20.10 - - - 35.89 36.23 III Premium on redemption

of FCCB - - - 3,084.90 2,839.89 10,006.59 516.60 695.90 344.50 3,427.40 3,038.34 10,213.81 The above statement should be read with significant accounting policies and notes to summary statements of the Company, as restated (Annexure IV) Note: 1. Also refer Annexure XV for principal terms and conditions for borrowings

428

Annexure X

Reliance MediaWorks Limited

Statement of current liabilities of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June 2007

A Short-term borrowings

I Term loans From banks

(secured) 7,500.00 - - 10,000.00 - - From banks

(unsecured) 15,000.00 23,500.00 40,000.00 10,000.00 - - II Loans repayable

on demand (secured)

From banks - Cash credit 2,172.40 2,500.00 352.60 37.20 293.60 344.08 III Loans and

advance from related parties (unsecured) 445.00 245.00 345.00 245.00 -

IV Other loans and advances -

a From banks - Buyers credit

(unsecured) - 318.00 1,392.60 926.80 - Buyers credit

(secured) 3,920.30 2,966.00 b Commercial

papers (unsecured) - 57,842.40 72,683.00 49,024.50 38,688.70 11,835.60

c Foreign currency convertible bonds (unsecured) - - - -

d Inter-corporate deposit (unsecured) 26,605.00 15,000.00 - 2,046.30

55,642.70 102,371.40 114,773.20 70,233.50 41,028.60 12,179.68 Above includes Borrowings from

Promoters 24,850.00 15,245.00 345.00 245.00 2,046.30 -

429

Annexure X

Reliance MediaWorks Limited

Statement of current liabilities of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June 2007

(as per SEBI ICDR Regulations, 2009) / Group companies / Subsidiaries / Material Associate companies

B Other current

liabilities I Current

maturities of long-term debts 53,266.70 49,045.80 32,307.60 - 0.40 3.64

II Interest accrued and due on borrowings 1,392.90 28.80 - - -

III Interest accrued but not due on borrowings 336.10 18.30 20.10 30.00 - -

IV Unclaimed dividend 10.50 12.20 13.80 14.60 8.20 6.84

V Advance received from customers 1,150.80 1,527.00 1,130.90 731.80 4,936.40 2,517.17

VI Advance against sale of assets (Refer note of 10 of I of E of Annexure IV) 18,650.00 -

VII Dues for capital expenditure 3,398.40 3,252.00 3,154.00 2,136.50 399.43 375.90

VIII Others * 5,647.68 1,875.48 1,592.02 1,648.33 2,602.03 1,445.40 *including

payable related to employee, expense payable and statutory dues. 83,853.08 55,759.58 38,218.42 4,561.23 7,946.46 4,348.95

C Short-term

provisions I Proposed

dividend - - - - 1,153.15 995.02 II Tax on proposed

dividend - - - - 196.05 169.10

430

Annexure X

Reliance MediaWorks Limited

Statement of current liabilities of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June 2007 III Gratuity - - - - 104.24 - IV Leave

encashment 103.20 125.40 31.80 29.30 347.21 21.20 103.20 125.40 31.80 29.30 1,800.65 1,185.32

The above statement should be read with significant accounting policies and notes to summary statements of the Company, as restated (Annexure IV)

Note: Disclosure as per SEBI ICDR Regulations, 2009 are as follows

Particulars of Lenders

Principal Amount

(`̀ in lakhs)

Period when amount is outstanding

Interest Rate Repayment Schedule

Reliance MediaWorks Theatres Limited

245.00 Period 2011 and 2009 7.00% Repayable on demand

Reliance MediaWorks Theatres Limited

345.00 Period 2010 7.00% Repayable on demand

Reliance MediaWorks Theatres Limited

445.00 Period 2012 7.00% to 10.00% Repayable on demand

Reliance Capital Limited

2,046.30 Period 2008 12.00% Repayable on demand

Reliance Capital Limited

15,000.00 Period 2011 12.00% One year from date of the loan

Reliance Capital Limited

24,405.00 Period 2012 13.00% to 14.50% One year from date of the loan

The above statement should be read together with significant accounting policies and notes to summary statements (Annexure IV).

Note: 1. Also refer Annexure XV for principal terms and conditions for borrowings

431

Annexure XI

Reliance MediaWorks Limited

Statement of revenue of the Company (` in lakhs)

Particulars Period 2012

Period 2011 Period 2010

Period 2009

Period 2008

Period 2007

Theatrical exhibition Sale of tickets 30,332.60 26,272.30 22,401.80 18,147.00 8,378.20 6,788.41 Less: Entertainment tax 5,706.00 3,919.10 2,890.80 1,925.80 1,023.50 517.65 24,626.60 22,353.20 19,511.00 16,221.20 7,354.70 6,270.76 Advertisements / sponsorship revenue 1,916.30 2,117.00 3,819.30 1,245.00 1,281.00 690.83 Facilities provided at multiplex 1,440.30 754.70 578.40 525.60 303.30 239.40 Food and beverages 8,436.80 7,122.80 5,139.89 3,867.94 1,434.91 1,535.07 Others 1,147.40 1,032.50 1,590.40 328.40 - - 37,567.40 33,380.20 30,638.99 22,188.14 10,373.91 8,736.06 Film production services Processing / printing of films 8,106.07 10,606.10 7,106.40 6,999.60 3,666.20 5,649.77 Equipment / facility rental income 2,640.90 2,066.60 1,839.40 612.40 265.30 76.63 Trading income 999.10 1,926.30 2,229.30 3,077.40 2,410.20 3,815.27 Others 94.90 13.60 45.90 67.40 - - 11,840.97 14,612.60 11,221.00 10,756.80 6,341.70 9,541.67 Film / content production, distribution and related services 246.40 676.40 3,692.00 15,289.40 10,179.10 13,730.79

Total 49,654.77 48,669.20 45,551.99 48,234.34 26,894.71 32,008.52 The above statement should be read with significant accounting policies and notes to summary statements, as restated (Annexure IV)

432

Annexure XII

Reliance MediaWorks Limited

Statement of other income of the Company (` in lakhs) For the period

Particulars Period 2012 Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Recurring Dividend income from : - Joint ventures - - - 75.00 55.00 87.60 - Subsidiaries - - 85.30 - - Other non-current investments - - - - 7.20 - - Current investments - - - 130.40 86.60 181.79 - - 85.30 205.40 148.80 269.39 Interest income from: - Bank 434.40 303.60 253.50 344.60 470.70 720.59 - Loans, advance and other deposits 390.80 469.60 152.90 372.10 360.80 2,193.89 825.20 773.20 406.40 716.70 831.50 2,914.48 Gain on sale of current investments 32.10 423.60 274.40 269.20 9.10 1,531.64 Bad debts recovered / provisions written back 42.00 814.00 1,080.90 - - - Sundry balances written back (net) - 306.30 Foreign exchange gain advances, trade receivables and trade payables (net) 1,845.70 349.10 - 1,203.50 - - Miscellaneous income 58.90 250.90 13.20 156.20 758.20 228.69 Non recurring Gain on derivative contracts (net) - 977.40 2,671.24 Gain on sale of non-current investment / rights therein 766.50 - - 1,700.00 2,660.30 - Consultation fees - - 2,130.50 - - Proceeds from key man insurance policy - - - 266.40 - - Share of advertisement income - - 1,213.00 - - - Profit on sale of assets / discarding of assets (net) - 2,701.10 - - - - 3,570.40 5,618.20 3,073.20 6,647.90 5,385.30 7,615.44 The above statement should be read together with significant accounting policies and notes to summary statements, as restated (Annexure IV).

Note 4. The classification of other income by the management into recurring and non-recurring is based on the current

operations and business activities of the Company. 5. Other income is related / incidental to the business activities of the Company. 6. In accordance with the accounting treatment followed by the Company, exchange fluctuation gain / loss and profit /

loss on sale of assets is disclosed net. Gross amounts in respect thereof are not readily determinable. Hence, net gain where applicable has been considered for the purpose of above disclosure.

433

Annexure XIII

Reliance MediaWorks Limited

Statement of contingent liabilities and commitments of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 A Central excise Disputed central excise demand

pending with the Central Excise and Service Tax Appellate Tribunal 2,121.50 1,918.40 1,715.30 1,308.80 1,110.90 986.36

Service tax Disputed Service Tax demand

pending with the Central Excise and Service Tax Appellate Tribunal 137.20 - - - - -

B Income tax i) Disputed liability in respect tax

deduction at source, matter is pending with

Commissioner of Income tax (Appeals) 1,017.10 1,017.10 - - - -

ii) Disputed tax liability in respect of AY 2008-09 for Rave Entertainment Private Limited (‘REPL’), REPL was wholly owned subsidiary of the Company and merged with it with effect from 1 April 2008. Department’s appeal against order of Commissioner of Income Tax (Appeals) is pending with Income Tax Appellant Tribunal (ITAT). In Period 2011 the same was pending with Commissioner of Income Tax (Appeals). 1,401.20 1,401.20 - - - -

Further Company has received demand in respect of REPL matter for assessment year

2009-10, appeal is pending with Commissioner of Income tax (Appeals) 1,787.20 - - - - -

C Entertainment tax

434

Annexure XIII

Reliance MediaWorks Limited

Statement of contingent liabilities and commitments of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 i) In respect of certain multiplexes,

the Company has made an application for availing exemption under the relevant Act retrospectively from the date of commencement of the operations of the said multiplex and the application is pending approval

300.60 219.40 340.00 391.30 280.30 92.97 ii) In respect of certain multiplexes,

the Company is in dispute with the entertainment tax authorities regarding eligibility for availing exemption under the relevant Act. 509.60 558.80 451.70 293.40 219.40 107.39

iii) In respect of demand orders

received for payments of entertainment tax collected and not paid to the authorities, the Company has made an appeal against said demand orders as it believes that the same is not payable, being exemption from payment available to it - 113.20 107.50 62.90 56.90 56.89

iv) The Company shall be liable to

pay the entertainment tax in the event that the multiplexes do not continue operations for a period of 10 years from the respective dates from which they commenced their operations 11,505.80 11,125.20 10,614.90 5,747.50 4,404.40 4,042.67

D Claims against Company not

acknowledged as debts 6,297.10 198.60 74.00 74.00 74.00 - E Guarantees - - - - 2,834.74 Guarantee given to Ministry of

information broadcasting of Radio license - - - 2,302.00 - -

Guarantees given to bank and

others for loans / credit facilities given to Subsidiary Companies 14,580.80 10,518.00 17,689.60 11,258.40 - -

435

Annexure XIII

Reliance MediaWorks Limited

Statement of contingent liabilities and commitments of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Guarantee given to a Service

providers in respect of Subsidiary Companies 4,878.20 4,254.00 4,218.10 33.70 - -

F Value added tax: Value added tax: The

Maharashtra Value Added Tax Act, 2002 lists the Scheduled entry, interalia, “Copy right” w.e.f. 1 April 2005. Pursuant to this enactment / scheduled entry, the entertainment industry has made a written representation to the Finance Minister, Maharashtra for deletion of the scheduled entry from the Act. Similar representation was made by the industry in some other states, as a result of which the Act was modified to delete this scheduled entry. The Company is awaiting a positive response from the Ministry of Finance in respect of the assurance given. Accordingly, no provision (amount not currently ascertainable) has been made in the books of accounts. With effect from the 1 May 2011 the Maharashtra Value Added Tax Act, 2002 was amended to exempt tax on Copyrights for distribution and exhibition of cinematographic films in theatres and cinema halls.

436

Annexure XIII

Reliance MediaWorks Limited

Statement of contingent liabilities and commitments of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 G

The Company has engaged the services of a Contractor for the purpose of deploying personnel at its cinemas. During the tenure of the contract, the Company has paid the Contractor, amounts payable towards employers contribution to provident fund (PF) amounting to ` 294.20 lakhs on a regular basis. The Company has learnt that the Contractor has failed to deposit appropriate amounts for employee and employer contributions amounting to approximately ` 588.40 lakhs with the PF authorities and the Company apprehends that some portion of the aforesaid amount which was supposed to be deposited in the individual accounts of the Personnel by the Contractor may have actually been mis-appropriated by the Contractor. The Company has filed a criminal complaint against the Contractor and the matter is currently under investigation. The Company has not received any claims in this regard.

H Capital Commitment i) Estimated amount of contract

remaining to be executed on capital account and not provided for net of advances (for fixed assets) 3,891.90 4,646.74 11,858.30 5,661.80 13,409.70 12,714.05

ii) Estimated amount of contract

remaining to be executed on capital account and not provided for net of advances (for investments) 1,200.00 1,200.00 - - - -

iii) Amount of uncalled on 150,000

partly paid preference shares of Tree of Knowledge DOT COM - - - 300.00 300.00 300.00

437

Annexure XIII

Reliance MediaWorks Limited

Statement of contingent liabilities and commitments of the Company (` in lakhs)

As at

Particulars 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 Private Limited

The above statement should be read with significant accounting policies and notes to summary statements, as restated (Annexure IV)

Note :- a) The Company is a party to various legal proceedings in the normal course of business and does not expect the outcome of

these proceedings to have any adverse effect on its financial conditions, results of operations or cash flows. b) The amounts are excluding penalty and interest if any that would be levied at the time of final conclusion.

Other Commitment :- a) Company has issued letter of financial support to some of its wholly owned foreign subsidiaries. b) In view of the loss during the period, the Company has not created Debenture Redemption Reserve in terms of Section 117

(C) of the Companies Act, 1956. The Company shall create such reserve out of profit, if any in future years. c) Preference shares shall be redeemed at the end of 20 years from the date of allotment. Each Preference shares shall be

redeemed at a premium calculated in a manner that gives the holder an yield of 10% p.a. (till date of redemption) on issue price of ` 1,000 (including premium of ` 995) after deduction of dividend, if declared during the tenure. However, the premium on redemption will be paid only to the original subscribers or to the transferees if the transfers have been previously approved by the Company. In the view of the loss during the period, ` 8.10 lakhs of yield for the current period will be paid as premium at the time of redemption.

438

Annexure XIV

Reliance MediaWorks Limited

Summary of accounting ratios of the Company (` in lakhs)

Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007

1 Net (loss) / profit after tax, as restated (45,850.80) (24,348.00) (8,797.00) (4,937.01) 1,856.37 9,667.54

2 Weighted average

number of equity shares outstanding during the Period for basic earnings per share 46,126,170 46,126,170 46,126,170 46,126,170 42,103,935 39,800,750

3 Add - equity share

issuable on conversion of FCCB (Refer note 5 of II of E of Annexure IV) - 1,694,699 2,061,884 2,061,884 6,084,140 8,387,325

4 Weighted average

number of equity share outstanding during the Period for dilutive earnings per share (Refer note 5 of II of E of Annexure IV) 46,126,170 47,820,869 48,188,054 48,188,054 48,188,075 48,188,075

5 Number of equity shares

outstanding at the end of the Period 46,126,170 46,126,170 46,126,170 46,126,170 46,126,170 39,800,750

6 Paid up value of each

equity share 5.00 5.00 5.00 5.00 5.00 5.00

7 Total paid capital – equity 2,306.30 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04

8 Reserves and surplus

(net of deficit in statement of profit and loss) (excluding revaluation reserve) 1,327.36 14,499.86 39,164.06 48,803.36 64,334.77 30,695.35

9 Net worth attributable to equity shareholders (7+8) 3,633.66 16,806.16 41,470.36 51,109.66 66,641.07 32,685.39

439

Annexure XIV

Reliance MediaWorks Limited

Summary of accounting ratios of the Company (` in lakhs)

Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Accounting ratios

a) Earnings per share Basic earnings per share (99.40) (52.79) (19.07) (10.70) 4.41 24.29 Diluted earnings per

share (99.40) (52.79) (19.07) (10.70) 3.85 20.06

b) Return of net worth (1,261.84)% (144.88)% (21.21)% (9.66)% 2.79% 29.58%

c) Net assets value per share 7.88 36.44 89.91 110.80 144.48 82.12

Note 1 The ratios have been computed

as under :- Basic and diluted earning per

share Net profit / (loss) after tax, as restated, attributable to equity shareholders

Weighted average number of equity share outstanding during the period end

Return on Net worth % Net profit / (loss) after tax, as restated, attributable to equity shareholders

Net worth, as restated, at the end of the period end

Net assets value per share (`) Net worth, as restated, at the end of the period end

Number of equity share outstanding at the end of the period end 2

Restated net profit as appearing in the restated statement of profit and loss and net worth as appearing in summary statement of assets and liabilities, as restated, has been considered for the purpose of computing the above ratios.

3 Calculation of ratios post issue has not been considered. 4 Earnings per share calculations are done in accordance with Accounting Standard 20 "Earning Per Share", notified in the

Companies (Accounting Standards) Rules, 2006. 5 The above statement should be read together with significant accounting policies and notes to summary statements, as

restated (Annexure IV) 6 Dilutive EPS has not been presented in Period 2009, Period 2010 and Period 2011, since it is anti dilutive.

Dividend on preference capital is non-cumulative. In view of the losses during Period 2012, ` 8.10 lakhs being yield for the period will be paid as premium at the time of redemption and shall be adjusted against securities premium reserve. Accordingly, the same is not adjusted for the purpose of calculating the above ratios.

440

Annexure XV Reliance MediaWorks Limited Statement of principal terms and conditions of long-term borrowings and short-term borrowings

(` in lakhs)

S. No

Particulars As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 1. Commercial Papers / Short Term Loans from Banks (unsecured)

A Templeton Mutual Fund (Refer note 9 of Annexure XV)

-

21,984.79 - - - -

B ICICI Prudential Fund (Refer note 9 of Annexure XV)

-

9,943.51 - - - -

C Templeton Mutual Fund (Refer note 9 of Annexure XV)

-

9,422.16 - - - -

D Yes Bank Limited (Refer note 9 of Annexure XV)

-

11,619.63 - - - -

E BNP Paribas (Refer note 9 of Annexure XV)

- 4,872.31 - - - -

F LIC MF Savings Plus d

- - 7,450.18 - - - G LIC MF Income Plus - - 9,832.06 - - - H LIC MF Floating Rate - - 983.21 - - - I LIC MF Savings Plus

d- - 9,808.90 - - -

J J M Financial Mutual Fund - - 2,477.40 - - - K J M Financial Mutual Fund - - 1,486.43 - - - L LIC MF Income Plus - - 9,599.87 - - - M LIC MF Savings Plus

d- - 9,599.87 - - -

N IFCI Limited - - 2,466.68 - - - O LIC MF Floating Rate - - 4,744.82 - - - P LIC MF Savings Plus

d- - 4,744.53 - - -

Q LIC MF Income Plus - - 9,489.05 - - - R Yes Bank Limited - - - 14,886.41 - - S IDBI Limited - - - 2,457.18 - - T SIDBI - - - 491.44 - - U Canara Bank - - - 2,456.18 - - V IFCI Limited - - - 4,893.69 - -

441

Annexure XV Reliance MediaWorks Limited Statement of principal terms and conditions of long-term borrowings and short-term borrowings

(` in lakhs)

S. No

Particulars As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 W LIC MF Floating Rate

d- - - 4,767.92 - -

X LIC MF Income Plus Fund - - - 4,767.92 - - Y LIC MF Liquid Fund - - - 4,767.92 - - Z LIC MF Savings Plus

d- - - 4,767.92 - -

AA LIC MF Special unit scheme

- - - 4,767.92 - -

AB UTI Mutual Funds - liquid h l

- - - - 1,973.16 - AC ABN Amro Money Plus

d- - - - 4,932.89 -

AD Lotus India Liquid Fund - - - - 1,973.16 - AE Birla Sun Life Interval

Income Fund Quarterly Plan Series II

- - - - 5,297.62

-

AF Kotak Quarterly Interval Plan - Series 66 - - - - 2,408.01 -

AG Allahabad Bank - - - - 1,965.13 - AH Birla Cash Plus - - - - 4,421.54 - AI United Bank Of India - - - - 3,438.97 - AJ UTI Spread Fund - - - - 2,456.41 - AK Saraswat Co-op Bank Ltd. - - - - 982.42 -

AL SBI Life Insurance Co. d

- - - - 2,456.04 - AM Tata MF - Tata Fixed

i d- - - - 3,928.19 -

AN ABN Amro Flexi Short Term Plan - Series B - - - - 2,455.16 -

AO Kotak Mahindra Flexi Debt Scheme - - - - - 1,972.60

AP Birla Cash Plus - - - - - 9,863.00 AQ Allahabad Bank - - 10,000.00 10,000.00 - - AR Syndicate Bank - 10,000.00 10,000.00 - - - AS Union Bank of India - 10,000.00 10,000.00 - - - AT Bank of Baroda - - 10,000.00 - - - AU Yes Bank Limited - 3,500.00 - - - - AV DBS Bank Limited (Refer

note 9 of Annexure XV) 15,000.00

- -

- - -

Sub total 15,000.00 81,342.40 112,683.00 59,024.50 38,688.70 11,835.60

442

2. Unsecured Long Term Loan from Bank (including amounts due within the next 1 year) A Canara Bank** 20,000.00 20,000.00 - - - - B DBS Bank Limited (Refer

note 9 of Annexure XV) - 15,000.00 - - - -

Sub total 20,000.00 35,000.00 - - - -

** - An instalment of ` 12,500.00 lakhs due on 28 March 2012 has been subsequently paid, before the adoption of summary statements by the Board of Directors.

3. Secured Short Term Loan From Bank

A Yes Bank Limited (refer note 1 and 4 of Annexure XV) 7,500.00 - - - - -

B Syndicate Bank (Refer note 6 of Annexure XV) - - - 10,000.00 - -

Sub total 7,500.00 - - 10,000.00 - -

4. Secured Long Term Loan From Bank / Other Long Term Loan (including amounts due within the next 1 year)

A Allahabad Bank (Refer note 1 of Annexure XV)* 3,333.33 3,333.33 5,000.00 5,000.00 - -

B Exim Bank (Refer note 1 of Annexure XV) * 4,666.68 4,666.68 7,000.00 7,000.00 - -

C Jammu & Kashmir Bank (Refer note 1 of Annexure XV) *

4,666.68 4,666.68 7,000.00 7,000.00 - -

D Syndicate Bank (Refer note 1 of Annexure XV) * 4,666.68 4,666.68 7,000.00 7,000.00 - -

E Union Bank of India (Refer note 1 of Annexure XV) * 4,000.00 4,000.00 6,000.00 6,000.00 - -

F Vijaya Bank (Refer note 1 of Annexure XV) * 5,333.33 5,333.33 8,000.00 8,000.00 - -

G Rank Investments Private Limited (Refer note 1 of Annexure XV) - - - - 2,500.00 -

H Barclays Bank Plc (Refer note 1 of Annexure XV)

- - - - 37,500.00 -

I Syndicate Bank (Refer note 6 of Annexure XV) 1,250.00 6,250.00 10,000.00 - - -

J Syndicate Bank (Refer note 1 of Annexure XV) 12,187.50 15,000.00 - - - -

K Union Bank of India (Refer note 1 of Annexure XV)

5,600.00 6,000.00 3,500.00 - - -

443

Annexure XV Reliance MediaWorks Limited Statement of principal terms and conditions of long-term borrowings and short-term borrowings

(` in lakhs)

S. No

Particulars As at 31 March

2012 31 March

2011 31 March

2010 31 March

2009 31 March

2008 30 June

2007 L Syndicate Bank (Refer

note 1 of Annexure XV) 10,000.00 - - - - -

M Non Convertible Debentures (Refer note 9 and 11 of Annexure XV)

35,000.00

- - - - -

Sub total 90,704.20 53,916.70 53,500.00 40,000.00 40,000.00 - * - As per agreement dated 28 June 2008 for long term loan obtained from banks, the Company has to comply with covenants with regards to financial parameters, as specified in the agreement. Based on Period 2009, 2010, 2011 and 2012 financials, the Company is not in compliance with the debt covenants.

An instalment of ` 13,333.33 lakhs due on 31 March 2012 has been subsequently paid, before the adoption of summary statements by the Board of Directors.

5. Overdraft facilities / Car loan A Cash credit - Bank of

Baroda (Refer note 2 and 4 of Annexure XV) 569.06 540.53 352.60 37.20 293.60 344.08

B Cash credit – Axis Bank (Refer note 5 of Annexure XV)

1,603.34 1,959.47 - - - -

C Car loan (Refer note 3 of Annexure XV)

- - - - 0.40 4.04

D Buyers credit (Refer note 7 of Annexure XV)

3,920.30 2,965.90 - - - -

Sub Total 6,092.70 5,465.90 352.60 37.20 294.00 348.12 6. Others (Unsecured) (including amounts due within the next 1 year)

A Zero Coupon Foreign Currency Convertible Bonds (Refer note 8 of Annexure XV)

-

- 15,224.30 14,230.00 13,099.90 46,158.00

B Inter corporate deposits 27,050.00 15,245.00 345.00 245.00 2,046.30 - C Buyers credit - 318.00 1,392.60 926.80 - - Subtotal 27,050.00 15,563.00 16,961.90 15,401.80 15,146.20 46,158.00 Grand total 166,346.90 191,288.00 183,497.50 124,463.50 94,128.90 58,341.72

444

Period 2012

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Allahabad Bank

3,333.33

11.50% per annum ` 1,666.67 Due on 31 March 2012. ` 1,666.67 Due on 31 March 2013

Exim Bank

4,666.68

11.50% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

Jammu & Kashmir Bank

4,666.68

11.50% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

Syndicate Bank

4,666.68

11.50% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

Union Bank of India

4,000.00

11.50% per annum ` 2,000.00 Due on 31 March 2012. ` 2,000.00 Due on 31 March 2013

Vijaya Bank

5,333.33

11.50% per annum ` 2,666.67 Due on 31 March 2012. ` 2,666.67 Due on 31 March 2013

Syndicate Bank 1,250.00

13.25% per annum ` 1250.00 due on 17 June 2012

Union Bank of India

5,600.00

14.25% per annum ` 400 .00 - 20 equal quarterly instalment starting from 31 March 2012

Syndicate Bank

12,187.50

13.25% per annum ` 937.50 - 16 equal quarterly instalment starting from 14 September 2011

Syndicate Bank

10,000.00

11.75% per annum ` 2,500.00 - 4 equal quarterly instalment starting from 14 September 2013

Canara Bank 12,500.00 12.75% per annum 28 March 2012

445

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

7,500.00 12.75% per annum 15 May 2012 Yes Bank Limited

1,500.00 13.00% per annum 31 May 2012

Yes Bank Limited 2,000.00

12.50% per annum 1 May 2012

Yes Bank Limited 1,000.00 12.50% per annum 4 May 2012

Yes Bank Limited 3,000.00

12.50% per annum 22 May 2012

DBS Bank Limited 15,000.00 14.40% per annum 27 April 2012 Non Convertible Debentures

35,000.00

11.00% per annum Coupon

Series 1 – 1 March 2014 Series 2 - 1 March 2015 Series 3 - 1 March 2016

Buyers Credit 3,920.30 Libor Linked – Various Various Dates Inter Corporate Deposit - Magma Fincorp Limited

2,200.00 12.00% per annum 23 Sep 2012

Inter-corporate deposit – Reliance MediaWorks Theatres Limited 445.00

9.50% per annum Repayable on demand

Inter-corporate deposit – Reliance Capital Limited 24,405.00

13.00% per annum Various Dates

Bank of Baroda (cash credit) 569.06 13.50% per annum Repayable on demand Axis Bank (cash credit) 1,603.34 14.00% per annum Repayable on demand Total 166,346.90

446

Period 2011

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Templeton Mutual Fund 21,984.79 11.75% per annum 15 June 2011 ICICI Prudential Fund 9,943.51 11.15% per annum 20 April 2011 Templeton Mutual Fund 9,422.16 11.75% per annum 12 October 2011 Yes Bank Limited 11,619.63 11.75% per annum 25 November 2011 BNP Paribas Mutual Fund 4,872.31 12.00% per annum 20 June 2011 Allahabad Bank

3,333.33

10.25% per annum ` 1,666.67 Due on 31 March 2012. ` 1,666.67 Due on 31 March 2013

Exim Bank

4,666.68

10.25% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

Jammu & Kashmir Bank

4,666.68

10.25% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

Syndicate Bank

4,666.68

10.25% per annum ` 2,333.34 Due on 31 March 2012. ` 2,333.34 Due on 31 March 2013

Union Bank of India

4,000.00

10.25% per annum ` 2,000.00 Due on 31 March 2012. ` 2,000.00 Due on 31 March 2013

Vijaya Bank

5,333.33

10.25% per annum ` 2,666.67 Due on 31 March 2012. ` 2,666.67 Due on 31 March 2013

Syndicate Bank 6,250.00

12.00% per annum ` 1,250.00 - 8 equal quarterly instalment started from 17 September 2010

Union Bank of India

6,000.00

13.00% per annum ` 400.00 - 20 equal quarterly instalment starting from 31 March 2012

Syndicate Bank

15,000.00

12.00% per annum ` 937.50 - 16 equal quarterly instalment starting from 14 September 2011

447

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Canara Bank 12,500.00 11.50% per annum 28 March 2012 7,500.00 11.50% per annum 15 May 2012

Syndicate Bank 10,000.00 9.00% per annum 27 May 2011 Union Bank of India 10,000.00 10.50% per annum 23 May 2011 Yes Bank Limited 3,500.00 12.50% per annum 27 May 2011 DBS Bank Limited 15,000.00 11.40% per annum 24 January 2012 Buyers Credit

3,283.90 Libor Linked – Various Various Dates

Inter-corporate deposit – Reliance MediaWorks Theatres Limited 245.00

7.00% per annum Repayable on demand

Inter-corporate deposit – Reliance Capital Limited 15,000.00

12.00% per annum 28 March 2012

Bank of Baroda (cash credit) 540.53 11.00% per annum Repayable on demand Axis Bank (cash credit) 1,959.47 12.75% per annum Repayable on demand Total 191,288.00

Period 2010

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

LIC MF Savings Plus fund 7,450.18 6.60% per annum 10 May 2010 LIC MF Income Plus 9,832.06 5.50% per annum 26 July 2010 LIC MF Floating Rate 983.21 5.50% per annum 26 July 2010 LIC MF Savings Plus Fund 9,808.90 5.50% per annum 11 August 2010 J M Financial Mutual Fund 2,477.40 6.30% per annum 25 May 2010 J M Financial Mutual Fund 1,486.43 6.30% per annum 25 May 2010 LIC MF Income Plus 9,599.87 6.25% per annum 3 December 2010 LIC MF Savings Plus Fund 9,599.87 6.25% per annum 3 December 2010 IFCI Limited 2,466.68 7.75% per annum 4 June 2010 LIC MF Floating Rate 4,744.82 7.25% per annum 29 December 2010 LIC MF Savings Plus 4,744.53 7.25% per annum 29 December 2010 LIC MF Income Plus 9,489.05 7.25% per annum 29 December 2010 Allahabad Bank

5,000.00

10.75% per annum ` 1,666.67 Due on 31 March 2011. ` 1,666.67 Due on 31 March 2012 ` 1,666.67 Due on 31 March 2013

448

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Exim Bank

7,000.00

10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Jammu & Kashmir Bank

7,000.00

10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Syndicate Bank

7,000.00

10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Union Bank of India

6,000.00

10.75% per annum ` 2,000.00 Due on 31 March 2011. ` 2,000.00 Due on 31 March 2012 ` 2,000.00 Due on 31 March 2013

Vijaya Bank

8,000.00

10.75% per annum ` 2,666.67 Due on 31 March 2011. ` 2,666.67 Due on 31 March 2012 ` 2,666.67 Due on 31 March 2013

Syndicate Bank

10,000.00

10.00% per annum ` 1250.00 - 8 equal quarterly instalment starting from 17 September 2010

Union Bank of India

3,500.00

11.00% per annum ` 400 - 20 equal quarterly instalment starting from 31 March 2012

Allahabad Bank 10,000.00 7.75% per annum 24 September 2010

Syndicate Bank 10,000.00 7.50% per annum 22 June 2010

449

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Union Bank of India 10,000.00 7.00% per annum 11 June 2010 Bank of Baroda 10,000.00 7.75% per annum 10 July 2010 Buyers Credit

1,392.60 Libor Linked – Various Various Dates

Zero Coupon FCCB (Refer note 8 of Annexure XV)

15,224.30 - 25 January 2011

Inter-corporate deposit – Reliance MediaWorks Theatres Limited 345.00

7% per annum Repayable on demand

Bank of Baroda (cash credit) 352.60 11.00% per annum Repayable on demand Total 183,497.50

Period 2009

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Yes Bank Limited 14,886.41 9.75% per annum 30 April 2009 IDBI Limited 2,457.18 10.00 % per annum 4 June 2009 SIDBI 491.44 10.00 % per annum 4 June 2009 Canara Bank 2,456.18 10.25 % per annum 4 June 2009 IFCI 4,893.69 10.20 % per annum 18 June 2009 LIC MF Floating Rate Fund 4,767.92 10.75 % per annum 14 September 2009 LIC MF Income Plus Fund 4,767.92 10.75 % per annum 14 September 2009 LIC MF Liquid Fund 4,767.92 10.75 % per annum 14 September 2009 LIC MF Savings Plus Fund 4,767.92 10.75% per annum 14 September 2009 LIC MF Special Unit Scheme 4,767.92 10.75% per annum 14 September 2009 Allahabad Bank – Secured loan 5,000.00 10.75% per annum ` 1,666.67 Due on 31

March 2011. ` 1,666.67 Due on 31 March 2012 ` 1,666.67 Due on 31 March 2013

Exim Bank 7,000.00 10.75% per annum ` 2,333.34 Due on 31

March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

450

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Jammu & Kashmir Bank 7,000.00 10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Syndicate Bank – Secured loan 7,000.00

10.75% per annum ` 2,333.34 Due on 31 March 2011. ` 2,333.34 Due on 31 March 2012 ` 2,333.34 Due on 31 March 2013

Union Bank of India 6,000.00 10.75% per annum ` 2,000.00 Due on 31

March 2011. ` 2,000.00 Due on 31 March 2012 ` 2,000.00 Due on 31 March 2013

Vijaya Bank 8,000.00 10.75% per annum ` 2,666.67 Due on 31

March 2011. ` 2,666.67 Due on 31 March 2012 ` 2,666.67 Due on 31 March 2013

Syndicate Bank – Unsecured loan 10,000.00 13.50% per annum 31 December 2009 Allahabad Bank – Unsecured loan 10,000.00 13.50% per annum 8 January 2010 Buyers Credit 926.80 Libor Linked – Various Various Dates

Zero Coupon FCCB (Refer note 8 of Annexure XV)

14,230.00 - 25 January 2011

Inter-corporate deposit - Reliance MediaWorks Theatres Limited

245.00 7.00% per annum Repayable on demand

Bank of Baroda (cash credit) 37.20 11.00% per annum Repayable on demand Total 124,463.50

451

Period 2008

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

UTI Mutual Funds - liquid cash plan 1,973.16 10.25% per annum 20 May 2008

ABN Amro Money Plus Fund 4,932.89 10.25% per annum 20 May 2008

Lotus India Liquid Fund# 1,973.16 10.25% per annum 20 May 2008

Birla Sunlife Interval Income Fund 5,297.62 10% per annum 20 August 2008 Kotak Quarterly Interval Plan - Series 6 2,408.01 10% per annum 20 August 2008 Allahabad Bank 1,965.13 10.20 % per annum 4 June 2008

Birla Cash Plus 4,421.54 10.20 % per annum 4 June 2008

United Bank Of India 3,438.97 10.20 % per annum 4 June 2008

UTI Spread Fund 2,456.41 10.20% per annum 4 June 2008

Saraswat Co-op Bank Ltd. 982.42 10.28% per annum 4 June 2008

SBI Life Insurance Co. Ltd. 2,456.04 10.28% per annum 4 June 2008

Tata MF - Tata Fixed Horizon Fund 3,928.19 10.50% per annum 4 June 2008

ABN Amro Flexible Short Term Plan - Series B 2,455.16 10.50% per annum 4 June 2008

Rank Investments Private Limited 2,500.00 10.75% per annum ` 833.34 Due on 31 March 2011. ` 833.34 Due on 31 March 2012 ` 833.32 Due on 31 March 2013

Barclays Bank Plc 37,500.00 10.75% per annum ` 12,500.00 Due on 31 March 2011. ` 12,500.00 Due on 31 March 2012 ` 12,500.00 Due on 31 March 2013

ICICI (car loan) 0.40 Various rates As per schedule Zero Coupon FCCB (Refer note 8 of Annexure XV)

13,099.90 - 25 January 2011

452

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Inter Corporate Deposit – Reliance Capital Limited 2,046.30 12.00% per annum Repayable on demand

Bank of Baroda (cash credit) 293.60 11.25% per annum Repayable on demand Total 94,128.90

453

Period 2007

Particulars of lenders and instrument Amount outstanding (`̀

in lakhs)

Interest rate Repayment schedule

Bank of Baroda(cash credit) 344.08 9% per annum Repayable on demand ICICI (Car loan) 4.04 Various rates As per schedule Commercial paper – Kotak 1,972.60 9.85% per annum 22 August 2007 Commercial paper – Birla Sunlife 9,863.00 9.85% per annum 22 August 2007 Zero Coupon FCCB (Refer note 8 of Annexure XV)

46,158.00 - 25 January 2011

Total 58,341.72

Commercial Paper:

Details of Terms of Discount rate and repayment schedule of Commercial papers are set out below:

Period 2011

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

Templeton MF (4,500 commercial paper of face value ` 500,000 each dated 28 December 2010 aggregating to ` 22,500 lakhs)

21,984.79 Issued at ` 21,339.08 lakhs, discount rate 11.75 % per annum

15 June 2011

ICICI Prudential Mutual Fund (2,000 commercial paper of face value ` 500,000 each dated 20 January 2011 aggregating to ` 10,000 lakhs)

9,943.51 Issued at ` 9,732.42 lakhs, discount rate 11.15 % per annum

20 April 2011

Templeton MF (2,000 commercial paper of face value ` 500,000 each dated 3 February 2011 aggregating to ` 10,000 lakhs)

9,422.16 Issued at ` 9,252.39 lakhs, discount rate 11.75 % per annum

12 October 2011

Yes Bank Ltd (2500 commercial paper of face value ` 500,000 each dated 25 February 2011 aggregating to ` 12,500 lakhs)

11,619.63 Issued at ` 11,490.20 lakhs, discount rate 11.75 % per annum

25 November 2011

BNP Paribas Mutual Fund (1000 commercial paper of face value ` 500,000 each dated 21 March 2011 aggregating to ` 5,000 lakhs)

4,872.31 Issued at ` 4,854.75 lakhs, discount rate 12.00 % per annum

20 June 2011

Total 57,842.40

454

Period 2010

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

LIC MF Savings Plus (1,500 commercial paper of face value ` 500,000 each dated 3 June 2009 aggregating to ` 7,500 lakhs)

7,450.18 Issued at ` 7,064.41 lakhs, discount rate 6.60 % per annum

10 May 2010

LIC MF Income Plus (2,000 commercial paper of face value ` 500,000 each dated 28 October 2009 aggregating to ` 10,000 lakhs)

9,832.06 Issued at ` 9607.67 lakhs, discount rate 5.50 % per annum

26 July 2010

LIC MF Floating Rate (200 commercial paper of face value ` 500,000 each dated 28 October 2009 aggregating to ` 1,000 lakhs)

983.21 Issued at ` 960.77 lakhs, discount rate 5.50 % per annum

26 July 2010

LIC MF Savings Plus (2,000 commercial paper of face value ` 500,000 each dated 13 November 2009 aggregating to ` 10,000 lakhs)

9,808.90 Issued at ` 9607.67 lakhs, discount rate 5.50 % per annum

11 August 2010

J M Financial Mutual Fund (500 commercial paper of face value ` 500,000 each dated 25 November 2009 aggregating to ` 2,500 lakhs)

2,477.40 Issued at ` 2424.26 lakhs, discount rate 6.30 % per annum

25 May 2010

J M Financial Mutual Fund (300 commercial paper of face value ` 500,000 each dated 30 November 2009 aggregating to ` 1,500 lakhs)

1,486.43 Issued at ` 1455.78 lakhs, discount rate 6.30 % per annum

25 May 2010

LIC MF Income Plus (2,000 commercial paper of face value ` 500,000 each dated 29 January 2010 aggregating to ` 10,000 lakhs)

9,599.87 Issued at ` 9499.02 lakhs, discount rate 6.25 % per annum

3 December 2010

LIC MF Savings Plus (2,000 commercial paper of face value ` 500,000 each dated 29 January 2010 aggregating to ` 10,000 lakhs)

9,599.87 Issued at ` 9499.02 lakhs, discount rate 6.25 % per annum

3 December 2010

IFCI Ltd. (2,000 commercial paper of face value ` 500,000 each dated 29 January 2010 aggregating to ` 10,000 lakhs)

2,466.68 Issued at ` 2452.10 lakhs, discount rate 7.75 % per annum

4 June 2010

LIC MF Floating Rate (1000 commercial paper of face value ` 500,000 each dated 9 March 2010 aggregating to ` 5,000 lakhs)

4,744.82 Issued at ` 4723.24 lakhs, discount rate 7.25 % per annum

29 December 2010

455

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

LIC MF Savings Plus (1000 commercial paper of face value ` 500,000 each dated 15 March 2010 aggregating to ` 5,000 lakhs)

4,744.53 Issued at ` 4728.56 lakhs, discount rate 7.25 % per annum

29 December 2010

LIC MF Income Plus (2000 commercial paper of face value ` 500,000 each dated 15 March 2010 aggregating to ` 10,000 lakhs)

9,489.05 Issued at ` 9457.12 lakhs, discount rate 7.25 % per annum

29 December 2010

Total 72,683.00

Period 2009

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

Yes Bank Limited (3,000 commercial paper of face value ` 500,000 each dated 3 February 2009 aggregating to ` 15,000 lakhs)

14,886.41 Issued at ` 14,663.14 lakhs, discount rate 9.75 % per annum

30 April 2009

IDBI Limited (500 commercial paper of face value ` 500,000 each dated 9 March 2009 aggregating to ` 2500 lakhs)

2,457.18 Issued at ` 2,441.80 lakhs, discount rate 10.00 % per annum

4 June 2009

SIDBI (100 commercial paper of face value ` 500,000 each dated 9 March 2009 aggregating to ` 500 lakhs)

491.44 Issued at ` 488.36 lakhs, discount rate 10.00 % per annum

4 June 2009

Canara Bank ( 500 commercial paper of face value ` 500,000 each dated 6 March 2009 aggregating to ` 2,500 lakhs)

2,456.18 Issued at ` 2,438.37 lakhs, discount rate 10.25% per annum

4 June 2009

IFCI (1,000 commercial paper of face value ` 500,000 each dated 20 March 2009 aggregating to ` 5,000 lakhs)

4,893.69 Issued at ` 4,877.33 lakhs, discount rate 10.20% per annum

18 June 2009

LIC MF Floating Rate Fund (1,000 commercial paper of face value ` 500,000 each dated 17 March 2009 aggregating to ` 5,000 lakhs)

4,767.92 Issued at ` 4746.95 lakhs, discount rate 10.75% per annum

14 September 2009

LIC MF Income Plus Fund (1,000 commercial paper of face value ` 500,000 each dated 17 March 2009 aggregating to ` 5,000 lakhs)

4,767.92 Issued at ` 4746.95 lakhs, discount rate 10.75% per annum

14 September 2009

456

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

LIC MF Liquid Fund (1,000 commercial paper of face value ` 500,000 each dated 17th March, 2009 aggregating to ` 5,000 lakhs)

4,767.92 Issued at ` 4,746.95 lakhs, discount rate 10.75% per annum

14 September 2009

LIC MF Savings Plus Fund (1,000 commercial paper of face value ` 500,000 each dated 17 March 2009 aggregating to ` 5,000 lakhs)

4,767.92 Issued at ` 4,746.95 lakhs, discount rate 10.75% per annum

14 September 2009

LIC MF Special Unit Scheme (1,000 commercial paper of face value ` 500,000 each dated 17 March 2009 aggregating to ` 5,000 lakhs)

4,767.92 Issued at ` 4,746.95 lakhs, discount rate 10.75% per annum

14 September 2009

Total 49,024.50

Period 2008

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

UTI Mutual Funds - liquid cash plan (400 commercial paper of face value ` 500,000 each dated 20 February 2008 aggregating to ` 2,000 lakhs)

1,973.16 Issued at ` 1,950.70 lakhs, discount rate 10.25% per annum

20 May 2008

ABN Amro Money Plus Fund (1,000 commercial paper of face value ` 500,000 each dated 20 February 2008 aggregating to ` 5,000 lakhs)

4,932.89 Issued at ` 4,876.74 lakhs, discount rate 10.25 % per annum

20 May 2008

Religare Mutual Fund* (400 commercial paper of face value ` 500,000 each dated 20 February 2008 aggregating to ` 2,000 lakhs)

1,973.16 Issued at ` 1,950.70 lakhs, discount rate 10.25 % per annum

20 May 2008

Birla Sunlife Interval Income Fund Quarterly Plan Series II (1,100 commercial paper of face value ` 500,000 each dated 20 February 2008 aggregating to ` 5,500 lakhs)

5,297.62 Issued at ` 5,238.78 lakhs, discount rate 10.00% per annum

20 August 2008

Kotak Quarterly Interval Plan - Series 6 (500 commercial paper of face value ` 500,000 each dated 20 February 2008 aggregating to ` 2,500 lakhs)

2,408.01 Issued at ` 2,381.26 lakhs, discount rate 9.20% per annum

20 August 2008

457

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

Allahabad Bank (400 commercial paper of face value ` 500,000 each dated 4 March 2008 aggregating to ` 2,000 lakhs)

1,965.13 Issued at ` 1,949.87 lakhs, discount rate 10.20% per annum

4 June 2008

Birla Cash Plus (900 commercial paper of face value ` 500,000 each dated 4 March 2008 aggregating to ` 4,500 lakhs)

4,421.54 Issued at ` 4,387.21 lakhs, discount rate 10.20% per annum

4 June 2008

United Bank Of India (700 commercial paper of face value ` 500,000 each dated 4 March 2008 aggregating to ` 3,500 lakhs)

3,438.97 Issued at ` 3,412.27 lakhs, discount rate 10.20% per annum

4 June 2008

UTI Spread Fund (500 commercial paper of face value ` 500,000 each dated 4 March 2008 aggregating to ` 2,500 lakhs)

2,456.41 Issued at ` 2,437.34 lakhs, discount rate 10.20% per annum

4 June 2008

Saraswat Co-op Bank Ltd. (200 commercial paper of face value ` 500,000 each dated 7 March 2008 aggregating to ` 1,000 lakhs)

982.42 Issued at ` 975.55 lakhs, discount rate 10.28% per annum

4 June 2008

SBI Life Insurance Co. Ltd. (500 commercial paper of face value ` 500,000 each dated 7 March 2008 aggregating to ` 2,500 lakhs)

2,456.04 Issued at ` 2,438.87 lakhs, discount rate 10.28% per annum

4 June 2008

Tata MF - Tata Fixed Horizon Fund (800 commercial paper of face value ` 500,000 each dated 7 March 2008 aggregating to ` 4,000 lakhs)

3,928.19 Issued at ` 3,900.14 lakhs, discount rate 10.50% per annum

4 June 2008

ABN Amro Flexible Short Term Plan - Series B (500 commercial paper of face value ` 500,000 each dated 7 March 2008 aggregating to ` 2,500 lakhs)

2,455.16 Issued at ` 2,437.59 lakhs, discount rate 10.50% per annum

4 June 2008

Total 38,688.70

458

Period 2007

Particulars of Lenders and Instrument Amount outstanding

Discount Rate Repayment Schedule

Kotak Mahindra flexi Debt Scheme (400 commercial paper of face value ` 500,000 each dated 24 May 2007 aggregating to ` 2,000 lakhs)

1,972.60 Issued at ` 1,952.60 lakhs, discount rate 9.85 % per annum

22 August 2007

Birla Cash Plus (2,000 commercial paper of face value ` 500,000 each dated 24 May 2007 aggregating to ` 10,000 lakhs)

9,863.00 Issued at ` 9,762.88 lakhs, discount rate 9.85 % per annum

22 August 2007

Total 11,835.60

* Religare Mutual Fund is formerly known as Lotus India Mutual Fund

Notes:

Note 1: Secured by first pari passu charge on all fixed assets of the company.

Note 2: Cash credit is secured by deferred payment note, hypothecation of book-debts, moveable fixed assets and stocks of chemicals.

Note 3: Secured against the motor cars acquired on Equitable Monthly Instalment (EMI) System.

Note 4: Secured by pari passu first charge on the inventories and book debts of the Company.

Note 5: Secured by pari passu Second charge of all the movable fixed assets and pari passu First charge on current assets of the Company.

Note 6: Secured by pari passu first charge on current assets of the Company including inventories, book debts and loans and advances.

Note 7: Secured by pari passu second charge on current assets and the moveable fixed assets of the Company.

Note 8: As per the terms of the issue document, the bonds were redeemable, in whole but not in part at the option of the Company at any time on or after 25 January 2009 and on or prior to 26 January 2011 subject to certain conditions at 121.679 per cent of the principal amount. During the current year the balance outstanding bonds were redeemed.

Note 9: These loans have been guaranteed by Reliance Capital Limited.

Note 10: Secured by pari passu first charge on fixed assets and current assets of the Company.

Note 11: Secured by first pari passu charge on the all assets of the Company and its wholly owned Indian subsidiaries, along with corporate guarantee by a Corporate.

Note 12: Secured by pari passu first charge on Current Assets of the Company i.e. goods, stocks, raw material, finished goods, unfinished goods, sundry debtors and loans and advances.

459

Annexure XVI

Reliance MediaWorks Limited

Statement of capitalisation as at 31 March 2012 (` in lakhs) Pre-issue Post-issue As at

Particulars 31 March 2012 As Adjusted for Issue* Borrowings:

Short term borrowings 55,642.70 Long term borrowings (including ` 53,266.70 current maturities) 110,704.20 Total borrowings 166,346.90 - Shareholder's Fund:

Share capital (including Preference Shares) 2,453.80

Reserves and surplus (net) (excluding revaluation reserves) 1,327.36 Less: Miscellaneous expenditures not written /off - Total shareholder's fund 3,781.16 -

Long term debt / Shareholder’s fund 29.28: 1 Notes : - a) Short term borrowing represents amount repayable within one year from 31 March 2012

b) The figures disclosed above are based on the summary statement of assets and liabilities, as restated, of the Company as at 31 March 2012

c) The corresponding post issue figures are not determinable at this stage pending the completion of the Rights issue process and hence have not been furnished.

460

Annexure XVII Reliance MediaWorks Limited Statement of the dividend paid / proposed

(` in lakhs)

Class of shares

Face value of share in

`

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Equity shares Equity share capital as at period end 5

2,306.30

2,306.30

2,306.30 2,306.30 2,306.30 1,990.04

Total 2,306.30 2,306.30 2,306.30 2,306.30 2,306.30 1,990.04

Final dividend

Rate of the final dividend (excluding dividend distribution tax) - - - - 50.00% 50.00%

Aggregating amount of final dividend - - - - 1,153.15 995.02

461

Annexure XVIII Reliance MediaWorks Limited Statement of related party disclosures, as restated Parties where control exists Holding company

Reliance Capital Limited (up to 30 November 2007) Reliance Land Private Limited (up to 30 November 2007)

Subsidiary companies

Reliance MediaWorks (UK) Limited (from 19 May 2006) Reliance MediaWorks (USA) Inc. (from 17 May 2006) Reliance MediaWorks (Netherlands) B.V. (from 8 February 2008) Reliance MediaWorks (Mauritius) Limited (from 20 March 2008) Adlabs Multiplexes and Theatres Limited (merged with the Company with effect from 1 April 2008) Reliance MediaWorks Theatres Limited Big Synergy Media Limited (from 12 January 2007) Adlabs Multiplex Limited (from 20 December 2007 and merged with the Company with effect from 1 April 2008) Rave Entertainment Private Limited (from 31 May 2007 and merged with the Company with effect from 1 April 2008) Reliance Broadcast Network Limited (ceased to be a subsidiary with effect from 1 April 2008 pursuant to demerger of

Radio business) Sri Ramakrishna Theatre Limited (from 11 January 2008 upto 27 May 2011) Rave Entertainment and Food Nepal Private Limited (from 24 August 2008) Reliance MediaWorks Entertainment Services Limited (from 4 May 2009) Katch 22 Entertainment Private Limited (from 23 April 2007 and merged with the Company with effect from 1 April

2006 during Period 2008) Reliance Media Consultant Private Limited (from 16 February 2012)

Step down subsidiary companies Big Cinemas Entertainment LLC (from 19 December 2007) Big Cinemas Entertainment (DE) LLC (from 24 January 2008) Big Cinemas Laurel LLC (from 28 November 2007) Big Cinemas Falls Church LLC (from 8 November 2007) Big Cinemas Norwalk LLC (from 14 March 2008) Big Cinemas Galaxy LLC (from 21 December 2007) Big Cinemas Sahil LLC (from 13 November 2007) Big Cinemas SAR LLC (from 8 November 2007) Phoenix Big Cinemas Management LLC (from 25 February 2008) Big Cinemas Phoenix LLC (from 22 February 2008) Big Cinemas Exhibitions LLC (from 6 March 2008) Big Cinemas IMC LLC (from 19 January 2008) Reliance Lowry Digital Imaging Services Inc. (from 1 September 2008) Reliance Media Works VFX Inc. (from 25 January 2010) Big Pictures USA Inc. (from 30 March 2009) Reliance Media and Marketing Communications LLC (from 13 May 2009) Adlabs Digital Media LLC (from 27 March 2009 till 15 April 2010, the date of dissolution) Adlabs Forum LLC (from 6 March 2008 till 8 February 2010, the date of dissolution) Adlabs Heritage LLC (from 7 March 200 till 14 May 2010, the date of dissolution)

462

Adlabs GlobalStar LLC (from 23 September 2009 till 9 February 2010, the date of dissolution) Big Cinemas Union LLC (from 8 February 2008 till 19 February 2010, the date of dissolution) Reliance MediaWorks (Malaysia) Sdn Bhd (from 18 April 2008) Big Cinemas Lotus Five Star Cinemas Sdn Bhd (from 1 November 2008)

Other related parties with whom transactions have taken place during the period (a) Significant shareholders, Key managerial personnel and their relatives Manmohan Shetty (up to 30 November 2007) Pooja Shetty (up to 30 November 2007) Kirti Desai – Manager appointed u/s 269 of the Companies Act, 1956 (from 30 January 2008 till 15 May 2011) Madhulika Singh – Manager appointed u/s 269 of the Companies Act, 1956 (from 28 May 2011 till 30 June 2011) Ashish R Agarwal – Manager appointed u/s 269 of the Companies Act, 1956 (from 1 July 2011) Reliance Land Private Limited (up to 30 November 2007)

(b) Enterprises over which company has significant influence / associates HPE / Adlabs LP. Sultan Production Private Limited (upto 31 March 2009)

(c) Joint ventures Cineplex Private Limited (upto 3 June 2011) Swanston Multiplex Cinemas Private Limited Divyashakti Marketing Private Limited Adlabs Multiplexes and Theatres Limited (upto 19 December 2007)

(d) Enterprises over which Key managerial personnel have significant influence Dharma Production Private Limited (up to 30 November 2007) Idream Productions Private Limited (up to 30 November 2007) Whistling Woods International Private Limited (up to 30 November 2007) Reliance Communication Infrastructure Limited (up to 30 November 2007) Reliance Capital Asset Management Limited (up to 30 November 2007) Reliance Web Stores Limited (up to 30 November 2007) Reliance General Insurance Company Limited (up to 30 November 2007) HPE / Adlabs LP. (up to 30 November 2007)

Nature of

transactions Name of related

party Holding Company

Period 2012 Period 2011 Period 2010

Period 2009

Period 2008

Period 2007

Rendering of services

Reliance Capital Limited - - - - - 31.43

Reliance Land Private Limited - - - - 515.00 463.50

Dividend Paid Reliance Capital Limited - - - - 31.38 28.24

463

Nature of transactions

Name of related party

Subsidiary Companies

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Receiving of Services

Reliance MediaWorks Theatres Limited - - 0.60 0.60 - 10.00 Adlabs Multiplex Limited - - - - 10.90 - Reliance MediaWroks Entertainment Service Limited 26.80 1,763.30 3.00 - - - Rave Entertainment Private Limited - - - - 4.70 -

Reimbursement of expenses

Reliance MediaWorks (UK) Limited - - (0.90) (70.20) 242.00 307.17 Reliance MediaWorks (USA) Inc. 88.80 (215.70) (0.80) (66.10) - 254.29 Reliance MediaWorks Entertainment Services Limited 4.00 0.30 38.90 - - - Sri Ramakrishna Theatre Limited - 1.70 - - - - Reliance MediaWorks (Mauritius) Limited 0.01 - - - - - Big Synergy Media Limited - - 58.50 86.70 81.80 114.21

Rendering of services

Reliance MediaWorks Theatres Limited 6.60 6.60 6.00 6.00 - 50.00 Reliance MediaWorks (UK) Limited - 0.50

3.80

425.80 36.40 1,315.99 Reliance MediaWorks (USA) Inc. - - 4.00 740.30 89.20 1,735.27 Adlabs Multiplex Limited - - - - 3.80 - Reliance MediaWorks Entertainment Services Limited 70.40 6.30 0.60 - - - Reliance MediaWorks (Netherlands) B.V - - 1.80 - - - Big Synergy Media Limited 218.10 304.10 312.10 76.00 70.50

Interest Income Reliance Broadcast Network Limited - - - - 130.30 2,086.68

Interest expenses

Reliance MediaWorks Theatres Limited 27.00 18.40 14.40 9.00 - -

464

Nature of transactions

Name of related party

Subsidiary Companies

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Dividend income Big Synergy Media Limited - - 85.30 - - -

Investment / Purchase of shares

Reliance MediaWorks (Mauritius) Limited - - - - 0.10 - Reliance MediaWorks (UK) Limited - - - - - 8.47 Reliance MediaWorks (USA) Inc. - - - - - 9.21 Reliance MediaWorks (Netherlands) B. V. - - - - 10.40 - Katch 22 Entertainment Private Limited - - - - - 1.00 Reliance MediaWorks Theatres Limited - - - - - 4.50 Rave Entertainment Private Limited - - - - 515.30 - Reliance Broadcast Network Limited - - - - 1,005.00 - Adlabs Multiplex Limited - - - - 1,704.50 Reliance MediaWorks Entertainment Services Limited - - 4.00 - - - Big Synergy Media Limited - - - - - 641.55

Conversion of loan to equity shares

Reliance MediaWorks Entertainment Services Limited - 2,000.00 - - - -

Subscription of preference shares

Reliance MediaWorks Entertainment Services Limited 12,000.00 - - - - -

Loan adjusted against security premium

Reliance Broadcast Network Limited - - - - - 7,965.39

Loan given

Reliance MediaWorks (Mauritius) Limited - 326.40 1,094.30 11,527.50 - - Reliance MediaWorks (UK) Limited 1,006.10 898.40 2,375.90 318.40 - - Reliance MediaWorks (USA) Inc. 789.90 7.090.00 11,564.60 9,381.70 865.80 Reliance MediaWorks (Netherlands) B. V. - 44.90 67.00 - 444.20 -

465

Nature of transactions

Name of related party

Subsidiary Companies

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Adlabs Multiplexes and Theatres Limited - - - - 436.50 - Rave Entertainment Private Limited - - - - 3,246.40 - Reliance Broadcast Network Limited - - - - 6,098.10 25,423.84 Adlabs Multiplex Limited - - - - 24.80 - Reliance MediaWorks Entertainment Services Limited 3,590.70 6,814.30 6,277.50 - - - Rave Entertainment and Food Nepal Private Limited - 432.00 - - - - Big Synergy Media Limited - - - - 155.00 50.00

Loan received back

Reliance MediaWorks Theatres Limited - - - - 310.90 - Reliance MediaWorks Entertainment Services Limited 12,000.00 - - - - - Reliance MediaWorks (Mauritius) Limited 149.80 - - - - - Reliance MediaWorks (USA) Inc. - - - 5,757.60 - - Reliance MediaWorks (Netherlands) B. V. - - - 406.70 - - Reliance Broadcast Network Limited - - - - 3,850.00 5,800.00 Reliance MediaWorks Entertainment Services Limited - - Adlabs Multiplex Limited - - - - 42.20 Big Synergy Media Limited - - - - 155.00 50.00 Reliance MediaWorks Theatres Limited - - - - 218.00

Loans taken

Reliance MediaWorks Theatres Limited (400.00) -

300.00 245.00 - -

Loans repaid

Reliance MediaWorks Theatres Limited

200.00 100.00 200.00 - - -

466

Nature of transactions

Name of related party

Subsidiary Companies

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Fixed assets purchased

Reliance MediaWorks Entertainment Services Limited

3.80 103.20 - - - -

Fixed assets sold

Reliance MediaWorks Entertainment Services Limited

- 9.70 - - - -

Guarantees given

Reliance MediaWorks (USA) Inc.

1,041.60 2,832.10 810.50 11,258.40 - -

Reliance MediaWorks (Netherlands) B.V.

- - - 33.70

- -

Reliance MediaWorks Entertainment Services Limited 2,604.00 -

7,500.00 - - -

Rave Entertainment and Food Nepal Private Limited

- - 283.00

- - -

Guarantees cancelled

Rave Entertainment and Food Nepal Private Limited - 100.00 - - - - Reliance MediaWorks (USA) Inc. - 9,906.60 - - - -

Guarantees outstanding

Reliance MediaWorks (USA) Inc. 9,134.00 7,054.00 14,094.50 11,258.4 - - Reliance MediaWorks (Netherlands) B.V.

34.70 32.00 30.30 33.70 - - Reliance MediaWorks Entertainment Services Limited 10,104.00 7,500.00 7,500.00 - - - Rave Entertainment and Food Nepal Private Limited

186.30 185.90 283.00 - - -

Net outstanding balances as at period end

Reliance MediaWorks (Mauritius) Limited 13,749.90 12,135.50 11,708.20 12,008.90 - - Reliance MediaWorks (430.30) (238.60) (333.10) (235.10) 47.90 (198.91)

467

Nature of transactions

Name of related party

Subsidiary Companies

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Theatres Limited

Reliance MediaWorks (UK) Limited 5393.10 3,745.30 2,427.60 406.10 238.10 51.07 Reliance MediaWorks (USA) Inc. 27,031.10 22,814.70 15,451.60 5,572.30 865.80 487.92 Reliance MediaWorks (Netherlands) B. V. 162.70 149.90 96.50 39.90 444.20 - Adlabs Multiplexes and Theatres Limited - - - - 436.50 - Rave Entertainment Private Limited - - - - 3,246.40 - Reliance Broadcast Network Limited - - - - 2,349.00 22,715.52 Adlabs Multiplex Limited - - - - 72.80 - Big Synergy Media Limited (151.60) (303.50) (477.20) 288.60 207.30 (114.21) Reliance MediaWorks Entertainment Services Limited 2,312.10 10,236.90 6,420.60 - - - Sri Ramakrishna Theatre Limited - 1.70 - - - - Rave Entertainment and Food Nepal Private Limited 432.00 432.00 - - - -

Nature of transactions

Name of related party

Significant shareholders, key management personnel and their relatives

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Dividend paid Manmohan Shetty - - - - 57.30 186.60

Managerial remuneration

Ashish R. Agarwal 17.50 Madhulika Singh 0.80 Kirti Desai 5.60 10.80 7.80 7.80 1.40 Manmohan Shetty - - - - 116.10 75.90 Pooja Shetty - - - - 4.90 37.95

Premium on key managerial policy Manmohan Shetty

- - - - - 48.06

Loans given Kirti Desai - - 5.00 - - - Loans repaid Kirti Desai - - 5.00 - - -

468

Nature of transactions

Name of related party

Enterprises over which Company has significant influence / associates

Period 2012 Period 2011 Period 2010

Period 2009

Period 2008

Period 2007

Reimbursement of expenses

Sultan Production Private Limited - - - (107.70) - -

Rendering of services

Dharma Production Private Limited - - - - - 111.26 Idream Productions Private Limited - - - - - 2.10 Whistling Woods International Private Limited - - - - - 4.21 Reliance Communication Infrastructure Limited - - - - - 190.88 Reliance Capital Assets Management Limited - - - - - 5.95 Reliance Web Stores Limited - - - - - 0.14

Interest Income HPE / Adlabs LP - - - - 43.70 147.08 Investment / Purchase of shares HPE / Adlabs LP - - - - - 4,607.75 Repayment of principal by Limited Liability Partnership HPE / Adlabs LP - - 241.70 - - -

Loan given Sultan Production Private Limited - - - 548.30 719.20 -

Outstanding Balances as at year / period end

Sultan Production Private Limited - - - 1,159.70 719.20 -

Nature of transactions

Name of related party

Enterprises over which Key Management personnel have significant influence

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Receiving of Services

Reliance General Insurance Company Limited - - - - - 136.16

Rendering of services

Reliance Communication Infrastructure limited - - - - - 191.75 Idream Production Private Limited - - - - - 2.10 Whistling Woods International Private Limited - - - - - 4.21 Reliance Capital Assets Management Limited - - - - - 5.95 Reliance Web Store Limited - - - - - 0.14

469

Nature of transactions

Name of related party

Enterprises over which Key Management personnel have significant influence

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Dharma Productions Private Limited - - - - - 111.26

Outstanding Balances as at period end

Dharma Production Private Limited - - - - - 0.06 Idream Productions Private Limited - - - - - 0.79 Reliance Communication Infrastructure Limited - - - - - 0.35 Whistling Woods International Private Limited - - - - - 0.38

Nature of transactions

Name of related party

Joint ventures

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Receiving of Services

Cineplex Private Limited - - 9.70 17.60 17.00 - Divyashakti Marketing Private Limited - - 8.40 14.60 18.00 - Swanston Multiplex Cinemas Private Limited - - 1.40 - - - Adlabs Multiplex Limited - - - - 23.50 -

Reimbursement of expenses

Cineplex Private Limited - 2.90 0.50 1.50 - 11.80 Divyashakti Marketing Private Limited - - 0.50 1.30 - 1.79 Adlabs Multiplex Limited - - - - - 15.46

Rendering of services

Cineplex Private Limited 2.80 16.50 16.50 16.90 12.60 18.75 Adlabs Multiplex Limited - - - - 6.50 14.92 Swanston Multiplex Cinemas Private Limited - - - - 87.60

Interest income

Divyashakti Marketing Private Limited 14.00 13.50 17.10 29.03 - - Cineplex Private Limited - 16.50 50.70 13.34 - -

Dividend Paid

Swanston Multiplex Cinemas Private Limited - - - (75.00) (55.00) -

Investment / Purchase of shares

Cineplex Private Limited - - - - - 20.00

Loan given Cineplex Private - - - - - 81.76

470

Nature of transactions

Name of related party

Joint ventures

Period 2012

Period 2011

Period 2010

Period 2009

Period 2008

Period 2007

Limited Divyashakti Marketing Private Limited - - - - - 192.55

Advance towards share application money

Swanston Multiplex Private Limited - - 125.00 - - -

Loan Received back

Cineplex Private Limited 133.40 101.50 104.30 128.10 30.00 130.00 Adlabs Multiplex Limited - - - - - 105.00

Purchase of fixed assets

Cineplex Private Limited - - - - - 1.07

Outstanding balances as at year end

Cineplex Private Limited

- 133.40 256.90 342.20 489.20 504.06

Divya Shakti Marketing Private Limited

228.10 201.30 194.50 223.60 222.40 218.83

Swanston Multiplex Cinemas Private Limited 125.80 125.80 125.80 - - -

Adlabs Multiplex Limited - - - - - 65.47

* - Amount written off – Period 2012 ` 14.00 lakhs, Period 2011 ` 13.50 lakhs, Period 2010: ` 30.40 lakhs

Note:

1. The Company's stake in share capital of Sultan Production Private Limited ('Sultan') is in excess of 20%. This investment was made by the Company with the intention of investment in the movie "Sultan: The warrior". However, during Period 2010, the Company had issued a letter of termination demanding refund for the moneys paid by the Company and filed a recovery suit against Orcher Studios, as per a shareholders’ agreement signed by the Company which has been agreed to by Orcher Studios. Since, the Company has intention of selling the shares; the Company has decided not to consider Sultan as an associate under AS-18 Related Party Disclosures and AS-23 'Accounting for Associates in Consolidated Financial Statements. The outstanding balance of Sultan Production Private Limited was ` 1,158.80 lakhs as at 31March 2010, of which the Company had considered ` 120.00 lakhs as doubtful in the previous year and provided for the same.

During Period 2011, the Company has received all the money receivable as per the shareholders agreement and sold the shares.

471

Annexure XIX

Reliance MediaWorks Limited

Statement of tax shelter (` in lakhs)

Sr. No. Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 1 (Loss) / profit

before tax, as restated (45,850.80) (24,348.00) (8,797.00) (4,920.31) 2,549.26 10,407.29

Adjustments for: Modified

Scheme of Amalgamation and Arrangement - - - - (6,705.80) (9,375.00)

Amalgamation of Katch 22 - - - - (2,000.00) (1,121.10)

2 Adjusted (Loss)

/ profit before tax, as restated (45,850.80) (24,348.00) (8,797.00) (4,920.31) (6,156.54) (88.81)

3a Income tax rates

including surcharge and education cess 32.45% 33.22% 33.99% 33.99% 33.99% *33.726%

3b Minimum alternate tax rate 20.01% 19.93% 17.00% 11.33% 11.33% *11.236%

4 Tax at income

tax rates (1X3a) - - - - - - 5 Adjustments: A Permanent

differences i Exempt income

net of expenses 1,014.66 (1,752.58) (2,318.83) 10.29 (3,737.17) (638.84) ii Expenditure

disallowed under Income Tax Act, 1961 0.38 (3,076.56) 4.05 23.68 20.77 14.83

iii Adjustments for:

Composite Scheme of Amalgamation - - - - - (2,050.42)

and Arrangement

Iv Scheme of Amalgamation - - - (7,756.55) - -

5a Total permanent differences 1,015.04 (4,829.14) (2,314.78) (7,722.58) (3,716.40) (2,674.43)

472

Annexure XIX

Reliance MediaWorks Limited

Statement of tax shelter (` in lakhs)

Sr. No. Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 B Timing

differences i Difference

between book and tax depreciation 45.70 (612.45) (2,061.06) (2,115.06) (5,038.38) (5,362.71)

ii Unrealised notional (gain) / loss on foreign exchange - - (2,037.19) 416.22 1,680.79 (35.48)

iii Arising out of differences in treatment of expenses as per Income Tax Act, 1961 and as per books of account:

iv (Loss) / profit

on sale of fixed assets 292.35 (2,701.14) 40.79 4.40 56.50 5.20

v Notional rent as per Accounting Standard 19 on "leases" 2,185.51 1,229.51 506.99 250.59 301.11 -

vi

Provision of bad debts / advances 2,325.10 1,658.21 121.88 - - 300.35

vii Others (191.55) 366.80 (174.17) 222.84 63.39 1,886.55 5b Total timing

differences 4,657.11 (59.07) (3,602.76) (1,221.01) (2,936.60) (3,206.09) c Other

differences i Profit on sale of

Investments (798.69) (423.57) (274.41) (269.17) (9.10) (1,531.65) ii Dividend

stripping u/s.94 - - - - 11.58 - 5c Total other

differences (798.69) (423.57) (274.41) (269.17) 2.48 (1,531.65) 6 Total

adjustments (5a+5b+5c) 4,873.46 (5,311.78) (6,191.95) (9,212.76) (6,650.52) (7,412.17)

7 Tax savings thereon (6X3a) 1,581.44 (1,764.57) (2,104.64) (3,131.42) (2,260.51) (2,499.83)

473

Annexure XIX

Reliance MediaWorks Limited

Statement of tax shelter (` in lakhs)

Sr. No. Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 8 Taxable (loss) /

profit as per Income Tax Act (2+6)

(40,977.34) (29,659.78) (14,988.95) (14,133.07) (12,807.06) (7,500.98)

9 Income tax

thereon (8X3a) - - - - - - 10 Short term

capital gains tax - - - - - - 11 Total income

tax - - - - - - 12

Taxable income as per section 115JB of the Income Tax Act, 1961 (43,415.53) (24,348.00) (8,882.27) (5,125.70) (8,965.66) (383.59)

13 MAT thereon

(12X3b) - - - - - - 14 Total tax as per

income tax return (higher - - - - - -

of 9 and 13) 14 Deferred tax

charge / (credit) - - - (134.80) 621.40 496.88 15 Fringe benefit

tax - - - 151.50 71.49 47.68 16 Total tax as per

summary statement of profit and loss, as restated - - - 16.70 692.89 544.56

474

Annexure XIX

Reliance MediaWorks Limited

Statement of tax shelter (` in lakhs)

Sr. No. Particulars Period 2012 Period 2011 Period 2010 Period 2009 Period 2008 Period 2007 Notes Normal tax rates

*

1 April 2006 to 31 March 2007 - 33.66% 1 April 2007 to 30 June 2007 - 33.99% MAT rates 1 April 2006 to 31 March 2007 - 11.22% 1 April 2007 to 30 June 2007 - 11.30%

1 The statement of tax shelter has been prepared based on adjusted profit/loss as per the summary statement of profit and

losses, as restated (Refer Annexure II.)

2 The above statement should be read together with Summary of significant accounting policies and notes to summary

statement, as restated (Annexure IV).

3 The figures for the year ended 31 March 2012 are based on the provisional computation of total income prepared by the

Company and are subject to any changes that may be considered at the time of final filing of the return of income for the year ended 31 March 2012.

4

Where the adjusted restated results before taxes are a loss, tax expense at applicable rate is taken as Nil.

475

FINANCIAL INDEBTEDNESS

The details of indebtedness of our Company on a standalone basis, as at June 30, 2012, are as provided below, together with a brief description of certain material covenants of the relevant financing agreements:

Secured Loans

I. Loans

Sr. no.

Name of the lenders

Nature of borrowing

Amount sanctioned

(except otherwise

stated, in ` lakhs)

Principal amount

outstanding as at June 30, 2012

(In `lakhs)

Purpose Utilization Interest/ Commission

Tenure

Repayment Security

1. Allahabad Bank, Export-Import Bank of India, Jammu & Kashmir Bank, Syndicate Bank, Union Bank of India and Vijaya Bank

Multi facility agreement dated March 28, 2008 as amended and restated by syndication and amendment agreement dated June 27, 2008 (“Multi Facility Agreement”)

Aggregate: 40,000.00

Aggregate: 13,333.36

(i) repayment of our Company’s outstanding commercial papers facilities; and (ii) funding capital expenditure in the exhibition and processing business and the repayment of our Company’s outstanding commercial papers

(i) part repayment of our Company’s outstanding commercial papers facilities; and (ii) funding capital expenditure in the exhibition division

For first 12 months commencing from the date of disbursement: 10.75% p.a. For the term thereafter (depending upon the benchmark rate selected by each of the lender): percentage rate p.a. equal to (i) SBI PLR – SBI PLR margin as defined in the Multi Facility Agreement; or (ii) GOI Sec + GOI Sec margin as defined in the Multi Facility Agreement

Five years from the date of disbursement i.e. commencing from March 31, 2008

Three equal annual installments commencing from date falling 36 months after the date of disbursement i.e. March 31, 2011

For details of security see note 1 below

Allahabad Bank:

5,000.00

1,666.67

476

Sr. no.

Name of the lenders

Nature of borrowing

Amount sanctioned

(except otherwise

stated, in ` lakhs)

Principal amount

outstanding as at June 30, 2012

(In `lakhs)

Purpose Utilization Interest/ Commission

Tenure

Repayment Security

Export-Import

Bank of India:

7,000.00

2,333.34

Jammu & Kashmir

Bank: 7,000.00

2,333.34

Syndicate Bank:

7,000.00

2,333.34

Union Bank of

India: 6,000.00

2,000.00

Vijaya Bank:

8,000.00

2,666.67

2. Syndicate Bank General Agreement dated June 11, 2010 and the sanction letter dated May 31, 2010 as supplemented by letter dated July 18, 2011

15,000.00 11,250.00 For augmenting long term working capital requirement

For augmenting long term working capital requirement

Base Rate + 2.50% p.a.

Five years 16 equal quarterly installments after one year initial moratorium from the date of drawdown

For details of security see note 1 below

477

Sr. no.

Name of the lenders

Nature of borrowing

Amount sanctioned

(except otherwise

stated, in ` lakhs)

Principal amount

outstanding as at June 30, 2012

(In `lakhs)

Purpose Utilization Interest/ Commission

Tenure

Repayment Security

3. Union Bank of India

Term loan agreement dated January 29, 2010 and review letter dated January 18, 2010 as modified by the sanction letter dated February 9, 2010. This was further modified by the sanction letter dated July 27, 2011. Our Company accepted this revision effective from June 6, 2012 vide agreement dated June 7, 2012

8,000.00 5,200.00 For financing our Company’s studios situated at Film City, Mumbai

For financing our Company’s studios situated at Film City, Mumbai

Base Rate + 3.50% p.a.

Six years 11 months

20 equal quarterly installment of `400 lakhs commencing from March 31, 2012

For details of security see note 1 below

4. Bank of Baroda Sanction letter January 5, 2010 as amended by letter dated June 20, 2010 and November 1, 2010

Aggregate: 6,100.00

Aggregate: 1,718.79

Working capital Working capital

For details of security see note 2 below Fund

based: 600.00

Fund based: 573.25

Cash credit: 1.50% below BPLR (floating) p.a.

Cash credit: 12 months

Cash credit: On demand

478

Sr. no.

Name of the lenders

Nature of borrowing

Amount sanctioned

(except otherwise

stated, in ` lakhs)

Principal amount

outstanding as at June 30, 2012

(In `lakhs)

Purpose Utilization Interest/ Commission

Tenure

Repayment Security

Non fund based:

5,500.00

Non fund based:

(i) letter of credit:

1,124.50 lakhs (USD

20 lakhs); (ii) bank

guarantee: 21.04

(i) Bank guarantee: commission of 50% of applicable charges; and (ii) Inland/import letter of credit/letter of undertaking/ letter of credit to avail buyer’s credit: (a) 40% of applicable charges for import/inland letter of credits upto `100 lakhs; (b) charges as applicable for import/inland letter of credits of above `100 lakhs; and (c) letter of undertaking / letter of credit in foreign currency as per schedule of charges

(i) Bank guarantee: five years. Above five years, the same shall will be dealt on case to case basis; and (ii) Inland/import letter of credit/ letter of undertaking / letter of credit to avail buyer’s credit: (a) 365 days for raw material; and (b) upto three years for capital goods

Bank guarantee on expiry and Inland/import letter of credit/ letter of undertaking / letter of credit to avail buyer’s credit: on maturity

5. Axis Bank Limited

Letter of arrangement: overdraft credit advances dated January 29, 2010 and sanction letter December 8,

Aggregate:

7,000.00

Aggregate: 6,039.60

For details of security see note 3 below

Fund based:

2,000.00

Fund based: 1,897.27

Over draft: to meet temporary mismatch of funds

Over draft: To meet temporary mismatch of funds

Over draft: Base Rate + 4.00% p.a.

One year Over draft: On demand

479

Sr. no.

Name of the lenders

Nature of borrowing

Amount sanctioned

(except otherwise

stated, in ` lakhs)

Principal amount

outstanding as at June 30, 2012

(In `lakhs)

Purpose Utilization Interest/ Commission

Tenure

Repayment Security

2009 as amended by the letter dated August 13, 2010 and the letter dated July 21, 2011

Non fund based:

5,000.00

Non fund based: (i)

letter of credit:Nil; (ii) letter of credit

for purchase/import of capital

goods: Nil; (iii) buyers

credit: 3,988.96; (iv)

bank guarantee:

153.37; and (v) standby

letter of credit: Nil

(i) letter of credit: (a) for procurement of raw materials, consumables stores, spares and tools, packing materials etc. (b) any other purpose approved by the bank; (ii) letter of credit for purchase / import of capital goods: (a) for procurement of capital goods; and (b) any other purpose approved by the bank; (iii) buyers credit and standby letter of credit: (a) for procurement of raw materials, consumables stores, spares and tools, packing materials etc. (b) any other purpose approved by the bank, (c) for procurement of capital goods; (iv) bank guarantee: towards bids, bond, security deposit, contract performance/performance guarantee, advance payment and retention money purpose etc.

(i) buyers credit: (a) for procurement of raw materials, consumables stores, spares and tools, packing materials etc. (b) any other purpose approved by the bank, (c) for procurement of capital goods; (ii) bank guarantee: towards bids, bond, security deposit, contract performance / performance guarantee, advance payment and retention money purpose etc.

Commission: (i) letter of credit and letter of credit for purchase/import of capital goods: 0.60% p.a. + services tax; (ii) buyers credit: 0.75% p.a. + applicable tax; (iii) bank guarantee and standby letter of credit: 0.75% p.a. + applicable service tax

(i) letter of credit and letter of credit for purchase / import of capital goods: (a) inland letter of credit: maximum usance upto 180 days; and (b) foreign letter of credit: maximum usance of 365 days; (ii) buyers credit: (a) import of raw material: upto one year; and (b) import of capital equipment: upto three years; (iv) bank guarantee: maximum upto 5.5 years; and (v) standby letter of credit: three years

On maturity

480

Sr. no.

Name of the lenders

Nature of borrowing

Amount sanctioned

(except otherwise

stated, in ` lakhs)

Principal amount

outstanding as at June 30, 2012

(In `lakhs)

Purpose Utilization Interest/ Commission

Tenure

Repayment Security

6. Syndicate Bank General agreement dated June 10, 2011 and sanction letter dated June 6, 2011

10,000.00 10,000.00 Long term working capital

Long term working capital

Base rate + 1% p.a.

Three years Four equal quarterly installments from the date of drawdown after a moratorium period of two years

For details of security see note 1 below

7. HDFC Bank Limited

Loan agreement cum guarantee dated October 26, 2006

Non fund based:

10,000.00 (credit

facility)

Non fund based: 493.85

(Bank Guarantee)

Working capital requirement

Working capital requirement

Commission: at a mutually agreed rate

On maturity On expiry For details of security see note 4 below

8. The Hongkong and Shanghai Banking Corporation Limited

Trade finance general agreement dated August 23, 2010 along with Sanction letter August 26, 2010 as amended by sanction letter dated June 20, 2011

Non fund based:

3,507.49 (USD

equivalent as at June 30, 2012

was 62.38 lakhs)

Non fund based:

3,507.49 (USD

equivalent as at June 30,

2012 was 62.38 lakhs)

(Standby letter of credit)

For issuance of standby letter of credit as a counter indemnity (guarantee) to HSBC, United States in order to facilitate issuance of standby letter of credit at HSBC, United States

For issuance of standby letter of credit as a counter indemnity (guarantee) to HSBC, United States in order to facilitate issuance of standby letter of credit at HSBC, United States

Commission: at a mutually agreed rate

Three years On maturity For details of security see note 5 below

9. Yes Bank Limited * **

Deed of Hypothecation; Loan Agreement dated 2nd November, 2011 along with Sanction letter dated December 4, 2008, addendum dated

Aggregate: 10,000.00

Aggregate: 243.33

Working capital requirement /cashflow mismatch

Working capital requirement / cashflow mismatch

6 months For details of security see note 6 below

Fund based:

10,000.00

Fund based: Nil

To be decided at the time of disbursement and 2% above YBL Base Rate

On Due dates or on Demand as mutually agreed; but maximum to be repaid by May 31, 2012

481

Sr. no.

Name of the lenders

Nature of borrowing

Amount sanctioned

(except otherwise

stated, in ` lakhs)

Principal amount

outstanding as at June 30, 2012

(In `lakhs)

Purpose Utilization Interest/ Commission

Tenure

Repayment Security

January11, 2010 & November 1, 2011

Non fund based:

4,000.00 (Sublimit

of Fund Based Limit)

Non fund based: (i)

letter of credit: Nil; (ii) letter of

credit for purchase/import of capital

goods: Nil; (iii) buyers

credit: 243.33; (iv)

Purchase Bill/ Invoice

Discounting : Nil; and (v)

standby letter of credit: Nil

(i)Letter of Credit – 0.50% p.a. payable annually in advance plus applicable taxes (including retirement charges); Delivery Order / BRO to be issued at INR 1000 (plus taxes) with Nil margin (ii) LOU for Buyers Credit - 0.60% p.a. plus taxes (iii) Purchase Bill/Invoice Discounting - to be decided at the time of drawl

On Due Dates or on Demand as mutually agreed; but maximum to be repaid by May 31, 2012 or replaced with equivalent margin against the outstanding.

10. Yes Bank Limited ***

Redeemable Non - Convertible Debentures

35,000.00 35,000.00 Refinancing of existing debt and capital expenditure of the Company

Repayment of Existing Debts

11.00% p.a. Coupon Rate

Series 1 – March 1, 2014 Series 2 – March 1, 2015 Series 3 – March 1, 2016

Series 1 – March 1, 2014 Series 2 – March 1, 2015 Series 3 – March 1, 2016

For details of security see note 7 below

* Reliance Capital Limited has provided a letter of comfort dated August 6, 2010 in favour of Yes Bank Limited ensuring that it will use its best endeavour and arrange for our

Company to repay the said facility upon receiving written request from Yes Bank Limited. ** The revolving short term loan facility includes other facilities (as its sub limits) such as sight letters of credit, usance letters of credit and letter of undertaking for buyers

credit. *** Reliance Capital Limited has provided a corporate guarantee dated March 5, 2012 in favour of Axis Trustee Services Limited for an amount of `35,000 lakhs for the said

Non convertible Debentures.

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Note 1:

First pari-passu charge on the fixed assets of our Company.

Note 2:

Cash credit & Inland/import letter of credit / letter of undertaking / letter of credit

First pari-passu charge on the entire current asset & movable fixed assets of our Company.

Bank guarantee

(i) Counter indemnity signed by our Company; and

(i) First pari-passu charge on the current asset of our Company; and

(ii) First pari-passu charge on the movable fixed assets of our Company.

Note 3:

(i) First pari-passu charge on the current asset of our Company; and

(ii) First pari-passu charge on the movable fixed assets of our Company.

In addition to the above, for bank guarantee and standby letter of credit a counter guarantee of our Company to be furnished.

Note 4:

Lien over fixed deposit to the extent of 100% value of the loan.

Note 5:

Lien over a fixed deposit to the extent of 110% value of the facility provided.

Note 6:

First pari passu charge on the fixed assets (movable and immovable) and current assets of the company including present and future.

Note 7:

Secured by pari passu first charge on Fixed Assets (including Immovable and Movable Fixed Assets) and Current Assets of the Company and wholly owned subsidiaries namely Reliance MediaWorks Entertainment Services Limited (formerly Digital Media Imaging Limited.) and Reliance MediaWorks Theatres

483

Limited (formerly Adlabs Distributors &Exhibitors Limited).

Unsecured Loans

II. Loans

Sr. no.

Name of the

lenders

Nature of borrowing

Amount sanctioned (In ` lakhs)

Principal amount

outstanding as at June 30, 2012

(In ` lakhs)

Interest/Commission

Tenure

Repayment

1. ICICI Bank Limited

Master facility Agreement dated January 11, 2006 as amended by supplemental and amendatory agreement to master facility agreement dated May 2, 2007 and the supplemental and amendatory agreement to master facility agreement dated November 30, 2007 along with credit arrangement letter dated April 19, 2007 as amended by sanction letter dated September 14, 2007

Aggregate: 22,500.00**

Aggregate: 4,113.85

Fund based: (i) Line of credit for short term loan: (a) for cost of funds linked pricing (applicable for upto six months funding): as stipulated by the bank on date of the drawal; (b) for foreign currency / foreign currency loan: such mark up over the LIBOR as stipulated by the bank at the time of drawal; (ii) overdraft: 2.50% p.a. below the sum of IBAR and the cash credit risk premium prevailing on each day + applicable interest tax or other statutory levy; (iii) working capital demand loan: 1.75% p.a. below the sum of IBAR and six months term premium + applicable interest tax or other statutory levy; and (iv) buyers credit: as stipulated by the bank on

Fund based: (i) Line of credit for short term loan: maximum upto 180 days; (ii) overdraft: on demand; (iii) working capital demand loan: maximum upto 180 days; and (iv) buyers credit: (a) raw material: 12 months from the date of shipment; and (b) capital expenditure: less than 36 months Non fund based: (i) Bank guarantee / SBLC: maximum upto five years; and (ii) letter of credit: (a) for

Fund based: (i) Line of credit for short term loan: on maturity; (ii) overdraft: on demand; (iii) working capital demand loan: on maturity; and (iv) buyers credit: on maturity. Non fund based: (i) Bank guarantee on expiry / SBLC on maturity; and (ii) letter of credit on maturity

Fund based: 2,500.00

-

Non fund based: 20,000.00

Non fund based: (i) Bank

guarantee / SBLC: 4113.85; and (ii) letter of

credit: Nil

484

Sr. no.

Name of the

lenders

Nature of borrowing

Amount sanctioned (In ` lakhs)

Principal amount

outstanding as at June 30, 2012

(In ` lakhs)

Interest/Commission

Tenure

Repayment

date of the disbursement, subject to RBI guidelines Non fund based: (i) Bank guarantee / Standby letter of credit: commission of 0.50% p.a.; and (ii) letter of credit: 0.50% p.a.

raw material: less than one year from the date of shipment; and (b) for capital goods: maximum usance period of less than three years from the date of shipment

2. Barclays Bank PLC

Redeemable Non – Convertible Debentures

4,400.00 4,400.00 12.50% p.a., compounded monthly, payable quarterly in arrears

Series A – September 18, 2012 Series B – December 10, 2012 Series C – March 10, 2013 Series D – June 10, 2013 Series E – September 10, 2013 Series F – December 10, 2013 Series G – March 10, 2014 Series H – June 10, 2014

Series A – September 18, 2012 – Rs. 550.00 Series B – December 10, 2012 - Rs. 550.00 Series C – March 10, 2013 - Rs. 550.00 Series D – June 10, 2013 - Rs. 550.00 Series E – September 10, 2013 - Rs. 550.00 Series F – December 10, 2013 - Rs. 550.00 Series G – March 10, 2014 - Rs. 550.00 Series H – June 10, 2014 - Rs. 550.00

** Each of the facility available under the credit arrangement letter dated April 19, 2007 as amended by sanction letter dated September 14, 2007 were valid upto August 26, 2008.

485

III. Inter Corporate Deposits Sr. no.

Name of the lenders

Nature of borrowing Amount sanctioned (In ` lakhs)

Principal amount outstanding as at

June 30, 2012 (In ` lakhs)

Interest

Tenure

Repayment

1. Reliance Capital Limited

Inter corporate deposit facility agreement dated March 7, 2012

25,187.50 22,504.92 13.00% p.a. One year from the date of disbursement

On Demand

2. Magma Fin Corp Ltd

Inter corporate deposit facility agreement dated March 26, 2012

2,200.00 2,200.00 12.00% p.a. 6 months from date of drawl

On Demand

3. Reliance Capital Limited

Inter corporate deposit facility agreement dated March 30, 2012

1,900.00 1,900.00 13.00% p.a. One year from the date of disbursement

On Demand

4. Reliance Capital Limited

Inter corporate deposit facility agreement dated April 3, 2012

18,850.00 18,850.00 13.00% p.a. One year from the date of disbursement

On Demand

5. Magma Fin Corp Ltd

Inter corporate deposit facility agreement dated April 30, 2012

1,300.00 1,300.00 12.00% p.a. 6 months from date of drawl

On Demand

6. Reliance Capital Limited

Inter corporate deposit facility agreement dated May 7, 2012

39,840.00 39,840.00 13.00% p.a. One year from the date of disbursement

On Demand

7. Reliance Capital Limited

Inter corporate deposit facility agreement dated June 7, 2012

3,863.50 3,863.50 13.00% p.a. One year from the date of disbursement

On Demand

Total 93,141.00 90,458.42

Others Further, as of June 30, 2012, our Company has availed an unsecured loan of `550 lakhs by way of promissory note dated March 19, 2010 from Reliance MediaWorks Theatres Limited (formerly Adlabs Distributors &Exhibitors Limited). This loan is repayable on demand and the interest payable on the same is 7.00% per annum.

486

Restrictive Covenants with Respect to our Borrowing

Certain corporate actions for which our Company requires the prior written consent of the lenders include:

1. Make any change in the management set-up;

2. Transfer the Equity Shares held by our Promoters below the prescribed per cent;

3. Issue any guarantee except as required under the transaction documents;

4. Enter into any transaction of merger, consolidation, amalgamation or re-organisation;

5. Convey, sell, lease, let or otherwise dispose of (or agree to do any of the foregoing at any future time) all or any part of its property or assets, except for any permitted disposal;

6. Alter Memorandum of Association and / or Articles of Association;

7. Agree to, create, incur, assume or suffer to exist any security interest upon or with respect to any property, revenues, or assets (real, personal or mixed, tangible or intangible) of our Company, whether now owned or hereafter acquired;

8. Change in our Company’s capital structure which is adverse to the interest of the lenders;

9. To declare or pay dividends for any year except out of profits relating to that year after the meeting of all financial commitments to the bank and making of due and necessary provisions;

10. To utilize the loans for purposes other than provided for;

11. Make any corporate investment or investment by way of contribution to share capital or debentures or advance funds to or place deposits with any concern; and

12. Any incremental indebtedness over and above outstanding as on February 15, 2012 – excluding promoter loans/group ICDs will be with the prior approval of Majority Debenture holders at that point of time.

13. Future losses to be funded through Equity or Promoter’s loan / Group ICD’s

14. All future Promoter loans/Group ICDs will be subordinated & subservient in all terms and conditions to the Debentures.

Further, under the terms of the loan agreements, our Company is required to maintain certain limits on financial ratios like, inter alia, ratio of gross borrowings to tangible net worth, ratio of gross borrowings to EBITDA, ratio of secured debt to secured fixed assets and ratio of EBITDA to schedule debt payment.

487

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

You should read the following discussion of our financial condition and results of operations in conjunction with the audited and restated consolidated financial statements including the schedules and notes thereto and the examination reports thereon, which appear at page 188. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, such as the risks set forth in the chapters entitled “Risk Factors” and “Forward Looking Statements” at pages 11 and 10, respectively. The following discussion and analysis of our financial condition and results of operations is based upon and should be read in conjunction with our audited consolidated financial statements, as restated, as of and for the twelve months ended on March 31, 2012 and Fiscal 2011, Fiscal 2010 and Fiscal 2009, including the schedules, annexures and notes thereto and the reports thereon. Our audited consolidated and standalone financial statements, as restated, are prepared in accordance with Indian GAAP, the accounting standards prescribed under the Accounting Standard Rules, 2006, the relevant provisions of the Companies Act and the SEBI Regulations. Overview We are one of India’s leading entertainment and media (“E&M”) companies with a presence across several businesses such as theatrical exhibition of films, film and media services and television content production and distribution. Our headquarters are located in Mumbai and we have operations across 78 cities and towns in India and internationally, in Nepal, Malaysia, the UK and the United States. Our theatrical exhibition business is our largest source of revenue. We operate one of India’s largest cinema chains, under the brand ‘BIG Cinemas’, with 262 screens in India and an additional 230 screens in Nepal, Malaysia and the United States as of June 30, 2012. During the 12 months ended March 31, 2012, BIG Cinemas catered to approximately 338 lakhs and 57 lakhs consumers in India and overseas, respectively. Our film and media services business comprising production, post-production services and creative services for films and television is our second largest source of revenue, which comprises: Production services: We lease sound stages, shooting floors, standard and high definition multi-camera

equipment and other related equipment to television and film production companies.

Post-production services: We process film negatives at our laboratories located in Mumbai, Chennai, Kolkata and London and trade film negatives in India. Our 4K DI laboratory located in Film City, Mumbai undertakes quality enhancement of film and television content through digital techniques.

Creative Services: We are also engaged in the film restoration business through our subsidiary, Digital Media Imaging Limited. We also provide creative services such as VFX, conversion of 2D content to 3D and CGI. In addition, our subsidiaries located in United States and UK, Lowry Digital and Reliance MediaWorks (UK) Limited, respectively, are engaged in the business of digital image correction, film restoration and film processing.

We operate our film post production services through production laboratories in Mumbai, Chennai, Kolkata and London and our creative services through facilities in Burbank (United States), London (U.K) and Navi Mumbai (India). Films processed at our laboratory in Mumbai have won, among others, 14 national awards for cinematography and our Company’s film processing facilities have been certified by Kodak Imagecare, an internationally recognised quality certification program, for each of the years beginning 2005. We were among four companies to receive the “Judges Award for Creativity & Innovation in Post-Production” at the Hollywood Post Alliance Awards in 2010. In August 2011, our Company received a patent for an innovation – “System and method for removing semi-transparent artifacts from digital images caused by contaminants in the camera’s optical path”. Our Company was the first Indian company to be recognized in the category of science and technology for the development of an unique and efficient system for the reduction of noise and other artefacts which provides a high quality image required for the film making process at the Academy of Motion Pictures, Arts & Science Awards 2012.

488

As a part of our long term growth strategy of asset creation, during the previous four years, we have established:

a business process outsourcing (BPO) facility at Navi Mumbai; post-production facilities for television commercials and broadcast; and a DI Lab.

Further, we have purchased broadcast and film cameras. We have also increased the number of screens we operate. This has been achieved organically and has enhanced our reach in terms of exhibition business and also enabled us to strengthen our capabilities in post-production services and creative services divisions. We are also in the process of establishing an approximately 2,00,000 square feet film studio located in Film City, Mumbai with facilities for shooting films, television shows and television commercials, which we believe meets international standards. This studio aims to provide a one-stop solution for all production needs for domestic and international clients. When completed, the studio is expected to have eight sound stages with appropriate noise control and other features. A part of the film studio constituting three sound stages was completed in January 2011. We expect to complete the remaining portion of the film studio by March 2013. We are also engaged in the business of television content production under the brand “BIG Synergy”, which primarily produces non-fiction programmes in addition to adapting international programme formats for Indian viewers. We have produced shows such as Kaun Banega Crorepati, Kya Aap Paanchvi Paas Se Tez Hai, Duss Ka Dum, India’s Got Talent, Aap Ki Kachehri - Kiran Bedi Ke Sath and Sach Ka Saamna. We also selectively distribute films. For the 12 months ended March 31, 2012 and Fiscal 2011, our restated consolidated net loss after tax was `57,216.63 lakhs and `32,796.95 lakhs, respectively. For the 12 months ended March 31, 2012 and Fiscal 2011, our consolidated total income was `83,472.70 lakhs and `85,026.20 lakhs, respectively.

Factors Affecting Our Results of Operations The key factors affecting our results of operations are set out below: Our Ability to Predict and Control Key Revenue and Cost Drivers The key components of our costs include:

Distributors’ Share for Exhibition of Films: Our ability to retain a sufficient share of our box office

collections for the films we exhibit is one of the key drivers of our revenues. In India, in order to obtain the right to exhibit a film in our single-screen cinema theatres, we pay the distributor of the film a certain fixed percentage of the relevant film’s gross or net box office collections, while for the exhibition of a film in our multiplexes, we pay the distributor of the film a percentage of our revenue based on the overall performance of the film at multiplexes in India. In overseas, we enter into agreements with distributors in which a distributor’s share could typically ranges between 40% to 70% of the box office collections, depending on the location of the cinema theatre and the film. In the future, if distributors are able to demand a higher share of films’ revenues, we will be able to retain a smaller share of our box office collections, which would adversely affect our operations.

Film Studio Establishment and Operation: We are also in the process of establishing an approximately 2,00,000 square feet film studio located in Film City, Mumbai with facilities for shooting films, television shows and television commercials, which we believe is on par with international standards. We believe that our future performance will be significantly dependent on our ability to complete the project in a timely manner and within expected costs. A part of this studio was completed in January 2011. We expect to incur significant additional costs to complete the remaining parts of the studio and to operate the studio to provide film and television production services. Certain factors that may affect the cost of establishing the studio include our ability to receive necessary equipment in a timely and cost efficient manner. As part of the construction process, we have placed orders for certain items of equipment. However, we are yet to place orders for large number of equipment. If we do not receive any such equipment in a timely manner, on

489

favourable terms or at all, the construction of our film studio may be delayed or prevented, which could adversely affect our results of operations.

Employee benefits Expenses: In order to successfully manage and expand our business, we are dependent on the services of key management personnel and our ability to attract, train, motivate and retain highly skilled employees, including artists, technicians and other professionals, which requires significant investments of time and financial resources. Consequently, employee benefits expenses constitute a significant portion of our total costs. As we add more products and services to our business and establish more cinema theatres, our employee benefits expenses will increase as a result. In addition, if any of our employees unionise or engage in work disruptions or stoppages, our employee benefits expenses may also increase. Changes in labour regulations in India and in the overseas jurisdictions in which we operate may also affect the costs of maintaining an adequate workforce.

Rent Expenses: Our ability to lease the properties at which we operate our cinema theatres at competitive rates is a key driver of our costs. We operate all but four of our cinema theatres through lease arrangements, business conducting agreements and management agreement for terms ranging from 3 to 30 years. . In the event that a lease or a business conducting agreement or management agreement is not renewed, we will be required to expend time and financial resources to relocate the cinema theatre which may adversely affect our financial condition. Any adverse changes in our ability to lease properties at competitive rates may adversely affect our results of operations.

Competitive Environment In our theatrical exhibition business, we face competition from other cinema theatre chains and standalone cinema theatre operators. We also face competition from alternative film delivery methods, including cable television, the Internet, digital video disc, satellite and pay-per-view services. In addition, technologies currently under development or that may be developed in the future, if employed by our existing theatrical exhibition business competitors or new entrants, may adversely affect our competitiveness. Our competitors may be able to deploy new technologies before us or we may be unable to adapt to new technologies, and we cannot predict how emerging and future technological changes will affect our operations or the competitiveness of our services. Changes in any of these factors may adversely affect the competitiveness of our theatrical exhibition business and consequently, our results of operations. We also face significant competition in our film production services business, including from local laboratories in southern India, where certain competitors are also the producers and distributors of regional films, which provides them with certain competitive advantages in relation to costs and business relationships. In digital film processing industry, we face competition from existing entities. Some of these entities have longer operating histories and greater financial resources than us. Our ability to compete in the film production services business depends in significant part on our ability to adapt to technological trends and offer competitive rates for our services. Any reduction in our ability to compete in the film production services business may adversely affect our results of operations. In our television production and distribution business, we primarily create non-fiction content, which is an emerging business in India dominated by a few key entities. Our success in this line of business would depend on our and our competitors’ ability to predict and cater to viewer preferences. Success of Films The success of the films we exhibit affects the revenue we generate in our theatrical exhibition business. Our potential cinema theatre patrons may be inclined to visit our theatres in significant part based on the appeal of the films we exhibit, irrespective of the services, technologies and amenities we offer. The availability of more successful films in our cinema theatres results in higher patronage and longer running films, and as a result, increased revenues from ticket sales, food and beverage sales and other revenue streams related to our cinema theatres. Our theatrical exhibition business revenues are driven in significant part on the availability of popular films that are well accepted by broad audiences. Ability to Borrow at Favourable Rates Our business requires significant amounts of capital expenditure and working capital. We have generally resorted to borrowings to meet our capital expenditure requirements. As an Indian company, we are subject to

490

exchange controls that regulate borrowing in foreign currencies. Such regulatory restrictions limit our financing sources for our operations and could constrain our ability to obtain financing on favourable terms and refinance existing indebtedness. In addition, certain of our financing agreements include conditions and restrictive covenants that require us to obtain consents from the respective lenders prior to carrying out certain activities and entering into certain transactions. Any future changes in regulatory restrictions or in the terms typically found in our indebtedness agreements may adversely affect our ability to borrow at favourable rates, which may in turn adversely affect our results of operations. Changes in Interest and Foreign Exchange Rates The entirety of our investments in our foreign operations and revenues generated from our foreign operations are denominated in foreign currencies. Change in the relevant foreign exchange rates could occur for a variety of reasons and may adversely affect the returns from these investments and the revenues generated. For instance, such changes in exchange rates could result from a decline in India’s foreign exchange reserves. In the future, adverse changes in interest and foreign exchange rates may adversely affect our results of operations. Changes in Economic Conditions Our results of operations are highly dependent on the overall economic conditions in India and in the foreign jurisdictions in which we operate. Our theatrical film exhibition business is our largest source of revenue. Cinema theatre attendance is a discretionary expense for our potential customers and thus may be particularly reduced in times of negative economic conditions. Any slowdown in the Indian economy or in the economies of the overseas jurisdictions in which we operate, due to, among other things, changes in interest rates, government policies, taxation, social and civil unrest and political, economic or other developments, could adversely affect our business and results of operations. Restrictions on ability to fund our foreign subsidiaries Our ability to fund our foreign subsidiaries is connected to our networth. Our stand-alone and consolidated networth, as restated as on March 31, 2012, was ` 3,781.16 lakhs and ` (23,958.07) lakhs, respectively. If our networth is impaired our ability to fund our foreign subsidiaries will be adversely impacted and, consequently, our growth and results of operations may be adversely impacted. Changes in Government Policies and Regulations We are affected by changes in a variety of government policies and regulations that affect the operations of our businesses in India. For instance, we are affected by changes in government policies regarding investment in overseas subsidiaries. These policies are governed by the relevant authority for foreign investment in those countries. In addition, we are eligible for exemptions from the payment of entertainment taxes in respect of 11 of our cinema theatres on the basis of policies of certain State governments, such as Maharashtra, Madhya Pradesh, Uttar Pradesh and Punjab. We are eligible for exemptions from the payment of a specified percentage of the entertainment taxes for a period of up to five years on a staggered basis from the date of commencement of operations in respect of 11 theatres in Maharashtra, Madhya Pradesh, and Uttar Pradesh, subject to the fulfilment of certain conditions required by the regulation. In addition, we are eligible for an exemption from payment of entire entertainment tax payable in respect of six theatres in Punjab and six theatres in Rajasthan throughout the life of such theatres. In the future, if we are unable to avail of such exemptions, our results of operations could be adversely affected. Cinema theatres in the states of Delhi, Punjab and Haryana are governed by the provisions of the Punjab Cinemas (Regulation) Act, 1952, as amended, under which the licensee must comply with ticket prices approved by the licensing authority. The said prices may be changed only with the prior intimation of the licensing authority and in Delhi, the prices may not be changes more than six times in a year.. In the event these restrictions prevent us from increasing the ticket prices as may be required by us, it may affect the results of our operations. Our Significant Accounting Policies Preparation of Consolidated Financial Statements Our consolidated financial statements have been prepared in accordance with AS 21 – ‘Consolidated Financial Statements’, AS 23 – ‘Accounting for Investments in Associates in Consolidated Financial Statements’ and AS 27 – ‘Financial Reporting of Interest in Joint Ventures’. Our consolidated financial statements are prepared

491

using uniform accounting policies for transactions and other events in similar circumstances, except where it is not practicable to do so. Our consolidated financial statements are presented to the extent possible, in the same format as that adopted by our Company for our independent financial statements. Our consolidated financial statements have been consolidated on the following basis: Subsidiaries: The excess of our cost of our investment in subsidiaries over our portion of equity in the

subsidiaries at the respective dates on which investment in such subsidiaries was made is recognised in our financial statements as goodwill and any excess of assets over our investment in a subsidiary is transferred to the capital reserve. Our portion of equity in our subsidiaries is determined on the basis of the book value of assets and liabilities in accordance with the financial statements of our subsidiaries as of the date of the investment.

The financial statements of our Company and our subsidiaries have been combined on a line-by-line basis by adding together the book values of like items of assets, liabilities, income and expenses, after eliminating intra-group balances and transactions and resulting unrealised profits in full. The amounts shown in respect of reserves and accumulated losses comprise the reserve or accumulated losses in accordance with the balance sheet of our Company and our share in the post-acquisition increase or decrease in the relevant reserves or accumulated losses of our subsidiaries. The amount of goodwill and capital reserve are presented on a net basis for each subsidiary. The minority interest’s share of profits or losses is adjusted against the income to arrive at the net income attributable to the shareholders. The minority interest’s share of net assets is disclosed separately in the balance sheet. During the 12 months ended March 31, 2012: o We sold our entire shareholding in Sri Ramakrishna Theatres Limited one of our subsidiaries

in May 2011. o We sold our entire shareholding shares in a joint venture viz., Cineplex Private Limited in

June 2011. o We incorporated a new subsidiary Reliance Media Consultant Private Limited with effect

from February 16, 2012. During Fiscal 2011: o We sold our entire shareholding in Sultan Production Private Limited

o We dissolved three LLCs in the United States viz., Adlabs Heritage LLC, Adlabs Digital

Media LLC and Adlabs GlobalStar LLC. o As part of a settlement with its minority holders, we acquired the balance 49% stake in Big

Cinemas Galaxy LLC.

Joint Venture Entities: Interest in jointly controlled entities are accounted for using the proportionate

consolidation method.

The list of subsidiaries considered in our consolidated financial statements with percentage shareholding for the 12 months ended March 31, 2012 is summarised below:

Name of Subsidiary Country of Incorporation Ownership Interest in the 12

months March 31, ended (%) Reliance MediaWorks Theatres Limited

India 100%

Reliance MediaWorks (UK) Limited

United Kingdom 100%

Reliance MediaWorks (USA) Inc. United States 100% Reliance MediaWorks (Netherlands) B.V.

The Netherlands 100%

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Name of Subsidiary Country of Incorporation Ownership Interest in the 12 months March 31, ended (%)

Reliance MediaWorks (Mauritius) Limited

Mauritius 100%

Big Synergy Media Limited India 51% Rave Entertainment and Food Nepal Private Limited

Nepal 100%

Reliance MediaWorks Entertainment Services Limited

India 100%

Reliance Media Consultant Private Limited

India 100%

Adlabs Multiplex Limited (1) India N.A. Rave Entertainment Private Limited (1)

India N.A.

Adlabs Multiplex and Theatres Limited (1)

India N.A.

Katch 22 Entertainment Private Limited (2)

India N.A.

Reliance Broadcast Network Limited (3)

India N.A.

Sri Ramakrishna Theatres Limited (4)

India N.A.

(1) It was amalgamated with our Company in Fiscal 2009. (2) It was amalgamated with our Company in Fiscal 2007. (3) It ceased to be our subsidiary from Fiscal 2009 pursuant to a scheme of demerger. (4) It ceased to be a subsidiary pursuant to sale of shares in the 12 months ended 2012.

The list of step-down subsidiaries considered in our consolidated financial statements with percentage shareholding in the 12 months ended March 31, 2012 is summarised below:

Name of Subsidiary Country of

Incorporation Name of Parent

Company Ownership Interest

in the 12 months ended March 31,

2012 (%) BIG Cinemas Entertainment LLC

United States Reliance MediaWorks (USA) Inc.

100%

BIG Cinemas Entertainment (DE) LLC

United States Reliance MediaWorks (USA) Inc.

100%

Adlabs Forum LLC (1) United States Reliance MediaWorks (USA) Inc.

N.A.

BIG Cinemas Laurel LLC

United States Reliance MediaWorks (USA) Inc.

100%

BIG Cinemas Falls Church LLC

United States Reliance MediaWorks (USA) Inc.

100%

Adlabs Heritage LLC (2) United States Reliance MediaWorks (USA) Inc.

N.A.

BIG Cinemas Norwalk LLC

United States Reliance MediaWorks (USA) Inc.

100%

BIG Cinemas Galaxy LLC

United States Reliance MediaWorks (USA) Inc.

100%

BIG Cinemas Sahil LLC

United States Reliance MediaWorks (USA) Inc.

97%

BIG Cinemas SAR LLC

United States Reliance MediaWorks (USA) Inc.

51%

Phoenix BIG Cinemas Management LLC

United States Reliance MediaWorks (USA) Inc.

51%

Big Cinemas Union LLC United States Reliance MediaWorks N.A.

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Name of Subsidiary Country of Incorporation

Name of Parent Company

Ownership Interest in the 12 months ended March 31,

2012 (%) (1) (USA) Inc. BIG Cinemas Phoenix LLC

United States Reliance MediaWorks (USA) Inc.

51%

BIG Cinemas Exhibition LLC

United States Reliance MediaWorks (USA) Inc.

100%

BIG Cinemas IMC LLC

United States Reliance MediaWorks (USA) Inc.

100%

Big Pictures USA Inc.

United States Reliance MediaWorks (USA) Inc.

100%

Adlabs Digital Media LLC (2)

United States Reliance MediaWorks (USA) Inc.

N.A.

Reliance Media and Marketing Communications LLC

United States Reliance MediaWorks (USA) Inc.

100%

Reliance Lowry Digital Imaging Services Inc.

United States Reliance MediaWorks (USA) Inc. – 90% Our Company – 10%

100%

Reliance MediaWorks VFX Inc.

United States Reliance MediaWorks (USA) Inc.

100%

Reliance MediaWorks (Malaysia) Sdn. Bhd.

Malaysia Reliance MediaWorks (Mauritius) Limited

100%

BIG Cinemas Lotus Five Star Sdn. Bhd.

Malaysia Reliance MediaWorks (Malaysia) Sdn. Bhd.

70%

(1) Dissolved in Fiscal 2010 (2) Dissolved in Fiscal 2011

The list of joint venture entities considered in our consolidated financial statements with percentage shareholding is summarised below:

Name of Joint Venture Country of Incorporation

Ownership Interest in the 12 months ended March

31, 2012 (%) Swanston Multiplex Cinemas Private Limited

India 50%

Divyashakti Marketing Private Limited

India 50%

Cineplex Private Limited (1) India N.A. (1) Ceased to be a Joint Venture pursuant to sale of shares in the 12 months ended March 31, 2012

Key accounting policies that are relevant and specific to our business and operations are as follows: Basis of Preparation: The summary statements of the subsidiaries, joint ventures and associate

companies used in the consolidation are for the same reporting period as our Company. These financial statements are audited by the auditors of the respective entities. Our financial statements have been prepared to comply in all material respects with the requirements of the Schedule II of the Companies Act, 1956 (the “Act”) and the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, to the extent applicable. Effective 1 April 2011, as per the Government Notification no. S.O. 447 (E) dated 28 February 2011 (as amended by notification no. F. No/2/6/2008-CL-V dated 30 March 2011), read with General

494

Circular no. 62/2011 dated 5 September 2011, issued by the Ministry of Company Affairs, the revised Schedule VI notified under the Act has become applicable to the Company for the purpose of preparation and presentation of its summary statements. The adoption of revised Schedule VI does not impact the recognition and measurement principles followed for preparation of summary statements. All assets and liabilities have been classified as current or non-current as per the Company’s normal operating cycle and other criteria set out in the revised Schedule VI.

Use of Estimates: The preparation of financial statements in conformity with GAAP in India requires

us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent liabilities on the date of the financial statements and the reported amount of income and expenses during the reported period. We believe that the estimates made in the preparation of financial statements are reasonable. Actual results could differ from those estimates. Any revision to accounting estimates is recognised prospectively in current and future periods.

Goodwill on consolidation: The excess of cost to the parent company of its investments over its portion of equity in the subsidiaries / associates / joint ventures, as at the date on which the investment was made, is recognised as goodwill in the financial statements. Our portion of equity in the subsidiaries / associates / joint ventures’ is determined on the basis of the book value of assets and liabilities as per the financial statements of the subsidiaries as on the date of investment. Goodwill is reviewed for a decline other than temporary in its carrying value, whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. We assess the recoverability of goodwill by reference to the valuation methodology adopted by us on the acquisition date, which included strategic and synergic factors that were expected to enhance the enterprise value. Accordingly, we would consider that there exists a decline other than temporary in the carrying value of goodwill when, in conjunction with its valuation methodology, its expectations with respect to the underlying acquisitions we have made deteriorates with adverse market conditions.

Fixed Assets and Depreciation / Amortisation:

o Tangible Assets: Tangible fixed assets are stated at cost or revalued amount in accordance with the scheme of amalgamation less accumulated depreciation and any provision for impairment. Cost includes freight, duties, taxes (other than those recoverable from tax authorities) and other expenses related directly or indirectly to the acquisition or construction and installation of the fixed assets and for bringing the asset to its working condition for its intended use. Depreciation on fixed assets is provided on the straight line method, at the rates prescribed in Schedule XIV to the Act, which, in our opinion, reflects the estimated useful lives of those fixed assets, except assets of subsidiaries, namely Reliance MediaWorks (USA) Inc. (including its subsidiaries), Big Cinemas Lotus Five Star Sdn. Bhd., Reliance MediaWorks (UK) Limited and Swanston Multiplex Cinemas Private Limited and our theatrical exhibition segment in India wherein depreciation is provided at following rates:

Plant and machinery: 7.07% to 20%

Furniture and fixtures: 10% to 25%

Computers: 20%

Motor cars: 10%

Office equipment: 10%

Leasehold improvements / buildings are depreciated over the lower of useful life of the asset and lease term, on a straight line basis. Individual assets costing up to Rs. 0.05 lakhs are depreciated fully in the year of acquisition.

o Intangible Assets: Intangible assets, all of which have been acquired or created and are

controlled through custody or legal rights, are capitalised at cost, where they can be reliably measured. Where capitalised, intangible assets are regarded as having a limited useful economic life and the cost is amortised over the lower of useful life or ten years.

495

Application software purchased, which is not an integral part of the related hardware, is shown as intangible assets and amortised on a straight line basis over its useful life, not exceeding five or ten years, as determined by us. Film rights comprise negative rights and distribution rights in films and are for a contractually specified mode of exploitation, period and territory and are stated at cost less accumulated amortisation. Cost of film rights comprises original purchase price or minimum guarantee. Cost is ascertained on a specific identification basis where possible. In case multiple films or rights are acquired for a consolidated amount, cost is allocated to each film / right based on management’s best estimates.

The individual film forecast method is used to amortise the cost of film rights acquired. Under this method, costs are amortised in the proportion that gross revenues realised bear to our estimate of the total gross revenues expected to be received. If estimates of the total revenues and other events or changes in circumstances indicate that the realisable value of a right is less than its unamortised cost, a loss is recognised for the excess of unamortised cost over the film right’s realisable value.

In respect of unreleased films, payments towards film rights are classified under capital advances as the amounts are refundable in the event of non-release of the film.

Internally generated software is capitalised by the Company and amortised over its estimated useful life of five / ten years.

Purchased goodwill is recognised by us on the basis of excess of purchase consideration paid over the value of the assets acquired at the time of acquisition and is amortised over its estimated useful life not exceeding ten years.

Impairment: In accordance with Accounting Standards 28 – ‘Impairment of Assets’, where there is an

indication of impairment of our asset, the carrying amounts of our assets are reviewed at each balance sheet date to determine whether there is any impairment. The recoverable amount of the asset (or where applicable, that of the cash generating unit to which the asset belongs) is estimated as the higher of its net selling price and its value in use. An impairment loss is recognised whenever the carrying amount of an asset or a cash generating unit exceeds its recoverable amount. Impairment loss is recognised in the statement of profit and loss. If at the Balance sheet date there is an indicator that a previously assessed impairment loss no longer exists, the recoverable amount is re-assessed and the asset is reflected at the recoverable amount subject to a maximum depreciated historical amount. Value in use is the present value of estimated future cash flows expected to arise from the continuing use of the asset and from its disposal at the end of its useful life.

Investments: Long-term investments are carried at cost. A provision for diminution is made to

recognise a decline, other than temporary, in the value of long-term investments and is determined separately for each individual investment. Current investments are carried at lower of cost and fair value.

Inventories: Inventories (comprising of food and beverage items, chemicals, negative film rolls, xenon

lamps and stores and spares related to theatrical exhibition / film production services business etc.) are stated at the lower of cost and net realisable value. Cost is determined on the first-in first out basis, except in the case of Reliance MediaWorks (USA) Inc. (and its subsidiaries), Big Cinemas Lotus Five Star Cinemas Sdn. Bhd. wherein we use the weighted average method. Inventory of DVDs is stated at lower of cost and net realisable value.

Employee benefits:

o Short Term Employee Benefits: All employee benefits payable wholly within 12 months of

rendering the service are classified as short term employee benefits. The undiscounted amount

496

of short term employee benefits expected to be paid in exchange for the services rendered by employees are recognised as an expense during the period.

o Long Term Employee Benefits:

Provident Fund and Other Schemes: Our state governed provident fund scheme,

employee state insurance scheme and labour welfare fund are defined contribution plans. The contribution paid or payable under the schemes is recognised during the year in which the employee renders the related service.

Gratuity Plan: Our gratuity benefit scheme is a defined benefit plan. Our net

obligation in respect of the gratuity benefit scheme is calculated by estimating the amount of future benefit that employees have earned in return for their service in the current and prior year; that benefit is discounted to determine its present value and the fair value of any plan assets is deducted. The present value of the obligation under such defined benefit plan is determined based on actuarial valuation using the Projected Unit Credit Method. The obligation is measured at the present value of the estimated future cash flows. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government Securities as at the Balance Sheet date. Actuarial gains and losses are recognised immediately in the statement of Profit and Loss.

Other Long Term Employment Benefits: Compensated absences which are not

expected to occur within twelve months after the end of the period in which the employee renders the related services are recognised as a liability at the present value of the defined benefit obligation at the Balance Sheet date, determined based on actuarial valuation using Projected Unit Credit Method. The discount rates used for determining the present value of the obligation under defined benefit plan, are based on the market yields on Government Securities as at the Balance Sheet date.

Revenue Recognition: Revenue is recognised to the extent that it is probable that the economic

benefits will flow to us and the revenue can be reliably measured. The amount recognised as sales is exclusive of value added tax and service tax and net of trade discounts. Amount of entertainment tax is shown as a reduction from revenue.

o Film Production Services Income: Revenue from processing or printing of cinematographic

films is recognised upon completion of the related processing / printing. Revenue from processing of digital content is recognised using the proportionate completion method. Use of the proportionate completion method requires us to estimate the efforts expended to date as a proportion of the total efforts to be expended. Efforts expended have been used to measure progress towards completion, as there is a direct relationship between efforts expended and contracted output. Sale of traded goods is recognised when the risks and rewards of ownership are passed on to the customer, which generally coincides with the dispatch of goods. Income from equipment or facility rental is recognised over the period of the relevant agreement or arrangement.

o Theatrical Exhibition and Related Income:

Sale of tickets: Revenue from theatrical exhibition is recognised on the date of the

exhibition of the films and comprises proceeds from sale of tickets, gross of entertainment tax. As we are the primary obligor with respect to exhibition activities, the share of distributors in these proceeds is separately disclosed as distributors’ share. Amount of entertainment tax is shown as a reduction from revenue

Revenue from gift cards is recognised on the basis of availing the facility by the customer. At the time of sale, the amounts received are recognised as deferred revenue.

Share of profit in partnership firm is recognised on the basis of audited financial statement of the Partnership firm.

497

Sale of food and beverages: Revenue from sale of food and beverages is recognised

upon sale and delivery at the counter.

Advertisement / sponsorship revenue: Revenue from advertisements, sponsorship and events is recognised on the date of the exhibition of the advertisement or event, over the period of the contract or on completion of our obligations, as applicable.

Management fee is recognised as revenue on a time proportion basis as per the relevant agreement.

o Television/ Film Production and Related Income: Revenue from sale of content or motion

pictures is accounted for on the date of agreement to assign or sell the rights in the concerned content or motion picture or on the date of release of the content or motion picture, whichever is later. Program sales are accounted on the delivery of tape to the channel.

o Income from Film Distribution Activity: In case of distribution rights of motion pictures or

content, revenue is recognised on the date of release or exhibition. Revenue from other rights such as satellite rights, overseas rights, music rights or video rights is recognised on the date when the rights are made available to the assignee for exploitation. Revenue from sale of VCDs/ DVDs is recognised when the risks and rewards of ownership are passed on to the customer, which generally coincides with the dispatch of the products.

o Interest Income or Income from Film Financing: Interest income, including from film or

content related production financing, is recognised on a time proportion basis at the rate implicit in the transaction.

o Dividend Income: Dividend income is recognised when the right to receive dividend is

unconditional at the balance sheet date.

o Marketing Rights or Rights to Profit: Amounts received in lieu of future marketing rights sale, right to future profit from our business and other rights are recognised as income in the period of entering into the contract.

Foreign Currency Transactions: Transactions denominated in foreign currency are recorded at the

exchange rate prevailing on the date of the transactions. Exchange differences arising on foreign exchange transactions settled during the year are recognised in the statement of profit and loss of the period. Monetary assets and liabilities denominated in foreign currencies as at the balance sheet date are translated at the closing exchange rates on that date; the resultant exchange differences are recognised in the statement of profit and loss except in case of exchange differences arising on translation of monetary items which form part of our net investment in a non-integral foreign operation which is accumulated in a ‘foreign currency translation reserve’ until its disposal. Non-monetary items which are carried at historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction. Forward contracts are entered into to hedge the foreign currency risk of the underlying transaction. The premium or discount on all such contracts arising at the inception of each contract is amortised as income or expense over the life of the contract. Exchange difference on forward contracts are recognised as income or expense in the statement of profit and loss of the period. Any profit or loss arising on the cancellation and renewal of forward contract is recognised as income or expense for the period.

Foreign Currency Translation: The consolidated financial statements are reported in Indian rupees in

accordance with AS-11 – ‘The Effects of Changes in Foreign Exchange Rates’ which specifies translation of foreign subsidiaries on the basis of their classification as integral / non-integral to the operations of the parent company. Local currency financials of each integral foreign subsidiary into Indian Rupees is performed in respect of assets and liabilities other than fixed assets, using the exchange rate in effect at the balance sheet date and for revenue and expense items other than the depreciation costs, using average exchange rate during the reporting period. Net exchange difference resulting from the above translation of the financial statements of integral foreign subsidiaries is recognised in the consolidated statement of profit

498

and loss. Fixed assets are translated at exchange rates on the date of the transaction and depreciation on fixed assets is translated at exchange rates used for translation of the underlying fixed assets. Translation of local currency balances of each non-integral foreign subsidiary into Indian Rupees is performed in respect of assets and liabilities at the exchange rate in effect at the balance sheet date and for revenue and expense items at the average exchange rate during the reporting period. Net exchange differences resulting from the above translation of the financial statements is accumulated in a ‘Foreign currency translation reserve’, disclosed as reserves and surplus. The amount accumulated will be held in this account till the time of disposal of the net investment in the subsidiary.

Leases: Rental expenses in non-cancellable arrangements / agreements with scheduled rent increases are recorded on a straight line basis over the lease term.

Borrowing costs: Borrowing costs that are attributable to the acquisition, construction or production of qualifying assets are capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes a substantial period of time to get ready for its intended use. All other borrowing costs are charged to revenue.

Recent Changes in Accounting Policies

1. Change in Accounting Policy for Depreciation, amortisation and impairment expense

During Fiscal 2009, we have charged depreciation as per the written down value method in the film production services, production and distribution business and for unallocated assets at the rates specified in Schedule XIV of the Companies Act till March 31, 2008. Commencing from April 1, 2008, we changed our policy to charge depreciation as per the straight line method at the rates specified in Schedule XIV of the Companies Act. For further details, please see the chapter entitled “Financial Statements – Significant accounting policies and notes to the restated summary statements of the Group – Significant changes in accounting policies and other adjustments (debited) / credited to the restated financial statements on page 188.

Our Business Segments Our business is divided into three segments on the basis of the nature of the businesses, the differing risks and returns, the organisation structure and our internal reporting systems: (a) Film Production Services: Film production services primarily comprise of processing of raw exposed

films, colour correction, editing, digital processing, visual effects, equipment rental, copying and printing of positive exhibition prints and trading in raw film rolls.

(b) Theatrical Exhibition: Theatrical exhibition operations comprise of single screen, multiplex, IMAX

cinema exhibition and a range of activities and services offered at our cinema theatres including catering food and beverages.

(c) Television, Film Production, Distribution and related services: Television and film production and

distribution operations comprise of the production of television or film content which is produced or co-produced by us and includes relates services of financing for production of films. Film distribution operations comprise of our share of revenue from exploitation and distribution rights acquired by us, which may include as a package, theatrical rights and video and television rights.

499

The following table summarises our consolidated income and operating profit from our three business segments, for the 12 months ended March 31, 2012 and for Fiscals 2011, 2010 and 2009:

(in ` lakhs except percentage amounts) Business Segment

12 months ended March 31, 2012

Fiscal 2011 Fiscal 2010 Fiscal 2009

Income

% of Total Income of Thre

e Segments

Operating

Profit/ (Loss)

Income

% of Total Incom

e of Three Segme

nts

Operating

Profit/ (Loss)

Income

% of Total Income of Thre

e Segments

Operating Profit

/ (Loss

)

Income

% of Total Income of Three Segments

Operating

Profit/ (Loss)

Theatrical Exhibition#

55,544.60

68.03%

(18,522.45)

54,678.30

65.39%

(10,398.60)

46,724.80

64.37%

(4,953.70)

33,171.14

50.31%

(4,545.60)

Film Production Services#

19,851.90

24.32%

(5,653.94)

23,265.50

27.83%

(477.60)

15,764.30

21.72%

3,067.42

13,057.00

19.80%

3,538.96

Film Production and Distribution#

6,247.96

7.65% 1,147.63

5,670.50 6.78%

1,150.00

10,099.00

13.91%

4,011.00

19,707.20

29.89%

3,187.33

Total 81,64

4.46 100.0

0% (23,028.

76) 83,614.

30 100.00

% (9,726.

20) 72,58

8.10 100.0

0% 2,124.

72 65,93

5.34 100.0

0% 2,180.6

9 # This includes part of Other Income allocated to each of our business segments and does not include unallocated revenue. Additionally, we have considered our overseas operations as separately identifiable geographic segments due to substantial operations in the US and Malaysia. The following table summarises our consolidated income from our four geographic segments, for the 12 months ended March 31, 2012 and Fiscals 2011, 2010 and 2009:

(in ` lakhs except percentage amounts) Geographic Segments

12 months ended March 31, 2012*

Fiscal 2011* Fiscal 2010* Fiscal 2009*

Income % of Total

Income of Three Segments

Income % of Total

Income of Three Segments

Income % of Total

Income of Three

Segments

Income % of Total

Income of Three Segments

India 59,280.66 72.61% 60,277.90 72.09% 50,012.80 68.90% 52,324.04 79.36 % United States of America

13,343.60 16.34% 16,234.10 19.41% 15,679.80 21.60% 11,540.00 17.50%

Malaysia 6,317.60 7.74% 5,615.70 6.72% 4,970.80 6.85% 1,491.10 2.26% Others 2,702.60 3.31% 1,486.60 1.78% 1,924.70 2.65% 580.20 0.88% Total 81,644.46 100.00% 83,614.30 100.00% 72,588.10 100.00% 65,935.34 100.00% * This includes part of Other Income allocated to each of our business segments and does not include unallocated revenue.

500

Consolidated Results of Operations The following table provides certain information with respect to our consolidated results of operations for twelve months ended March 31, 2012 and Fiscals 2011, 2010 and 2009, as set forth in our audited restated consolidated financial statements.

(in ` lakhs except percentage amounts) Particulars 12 months ended

March 31, 2012 Fiscal 2011 Fiscal 2010 Fiscal 2009

Amount (`̀ in

lakhs)

% of Total Income

Amount

(` in lakhs)

% of Total Income

Amount

(` in lakhs)

% of Total Income

Amount (` in lakhs)

% of Total Income

Revenue from operations 81,744.9

0 97.93

% 79,207.4

0 93.16

% 71,507.2

0 95.64

% 65,935.

34 90.17

%

Other income 1,727.80 2.07% 5,818.80 6.84% 3,256.70 4.36% 7,184.9

0 9.83%

Total revenue 83,472.7

0 100.0

0% 85,026.2

0 100.0

0% 74,763.9

0 100.0

0% 73,120.

24 100.0

0% Expenditure

Direct operational expenses 32,615.6

0 39.07

% 31,059.8

0 36.53

% 28,102.0

0 37.59

% 23,868.

30 32.64

%

Employee benefits expense 21,741.1

0 26.05

% 20,979.8

0 24.67

% 13,179.3

0 17.63

% 10,147.

60 13.88

%

Other expenses 43,279.9

5 51.85

% 34,672.9

6 40.78

% 25,317.0

5 33.86

% 20,056.

90 27.43

%

Finance costs (net) 28,505.1

7 34.15

% 17,514.2

0 20.60

% 11,717.2

0 15.67

% 12,447.

20 17.02

% Depreciation, amortization and impairment expense

14,159.10

16.96%

13,226.50

15.56% 9,729.44

13.01%

13,542.41

18.52%

Total expenses 140,300.

92 168.0

8% 117,453.

26 138.1

4% 88,044.9

9 117.7

6% 80,062.

41 109.4

9%

Loss before tax, minority interest and share in associates

(56,828.

22) (68.08

)%

(32,427.

06) (38.14

)%

(13,281.

09) (17.76

)%

(6,942.1

7) (9.49)

% Less: Provision for tax

- Current tax

460.00 0.55%

113.90 0.13%

39.61 0.05%

414.91 0.57%

- Deferred tax credit / (charge)

(472.69) (0.57)

%

452.69 0.53%

13.25 0.02%

(69.44) (0.09)

%

- Fringe benefit tax

- 0.00%

- 0.00%

- 0.00%

171.70 0.23%

Loss after tax and before minority interest

(56,815.

53) (68.06

)%

(32,993.

65) (38.80

)%

(13,333.

95) (17.83

)%

(7,459.3

4) (10.20

)% Add: Share in profit of associate

Less: (Loss) / profit transferred to Minority interest

401.10 0.48%

(196.70)

(0.23)%

(530.87)

(0.71)%

(322.12

) (0.44)

%

Net loss after tax before adjustment pursuant to Schemes

(57,216.

63) (68.55

)%

(32,796.

95) (38.57

)%

(12,803.

08) (17.12

)%

(7,137.2

2) (9.76)

% Less: Adjustment pursuant to Radio Scheme of Arrangement / Scheme of Amalgamation - - - - - -

(649.30)

(0.89)%

501

Particulars 12 months ended March 31, 2012

Fiscal 2011 Fiscal 2010 Fiscal 2009

Amount (`̀ in

lakhs)

% of Total Income

Amount

(` in lakhs)

% of Total Income

Amount

(` in lakhs)

% of Total Income

Amount (` in lakhs)

% of Total Income

Net loss as restated

(57,216.

63) (68.55

)%

(32,796.

95) (38.57

)%

(12,803.

08) (17.12

)%

(7,786.5

2) (10.65

)% INCOME Our income comprises income from our operations and other income, each of which is described below. Income from operations Our income from operations is primarily comprised of income from our various businesses: theatrical exhibition, film production services and television and film content production and distribution. Theatrical Exhibition The theatrical exhibition of films is our primary business and largest source of revenue, which is generated from the sale of admission tickets, food and beverage sales, the sale of advertisement space and the utilisation of other facilities in our cinema theatres. Film Production Services Our film production services business is our second largest source of revenue, which is generated from the operation of services related to film processing, film negatives trading, equipment rental, post-production and film restoration. Television and Film Production and Distribution We acquire various rights including the right to theatrical exhibition in India and overseas territories and home viewing format rights for films for distribution on a commission basis or on an overflow basis for our distribution business. We typically acquire the rights to films that are under production or are at a conceptual stage. We also engage in the co-production of films. Where we have co-produced films we realise our revenue from these films including through the sale of rights for theatrical releases and satellite broadcast. BIG Synergy Media Limited, one of our subsidiaries is engaged in the production of television content. Interest Income Interest income is primarily generated from certain fixed deposits that we maintain. We also generate interest income from loans given to our employees and interest on inter-corporate deposits. Other Income Our other income primarily includes both recurring and non-recurring income. The recurring components of our other income include dividend income, interest income, profit on sale of current investments, bad debts recovered, provisions and sundry balances written back and foreign exchange gains. The non-recurring components of our other income include profits on option contracts, sale and discarding of assets and sale of investments, profits from insurance and share of advertisement income. Expenditure

502

Our expenditure consists generally of operating expenses, employee benefits expenses, administrative expenses, finance costs (net) and depreciation / amortisation. Direct operational expenses Our operating expenses primarily comprise the following:

the production and processing of film negatives for our film services business; distributors’ share in our theatrical exhibition business; food and beverage costs; overflow to producers; and content production costs in the relation to our television and film content production and distribution

business. Cost of Negative Films The production and processing of film negatives is a significant cost in relation to our film production services business. It primarily consists of the cost of negatives purchased by us for trading and utilisation during processing. Distributors’ Share in Our Theatrical Exhibition Business In order to obtain the right to exhibit a film in our single-screen cinema theatres, we pay the distributor of the film a certain fixed percentage of the relevant film’s gross or net box office collections. In order to obtain the right to exhibit a film in our multiplexes, we pay the distributor of the film a percentage of our revenue based on the overall performance of the film at multiplexes in India, in accordance with the settlement agreement reached in May 2009 between the Multiplex Association of India and the Film & Television Producers’ Guild of India. Pursuant to the settlement agreement, we have entered into distribution agreements with major distributors in India which provide for a sliding scale of payment of a distributor’s share based on a film’s performance. For the exhibition of films in the United States, we enter into agreements with distributors in which a distributor’s share typically ranges from approximately 40.0% to 70.0% of box office collections, depending on the location of the cinema theatre and the film. Food and Beverage Costs We purchase branded and unbranded food and beverage items from various vendors for preparation and sale in our theatres and multiplexes. The cost of our food and beverage sales is determined by the type and quantity of items purchased, the controls we institute to reduce wastage and the structure of the menu used in our theatres and multiplexes. Overflow to Producers When we acquire film distribution rights, we typically are required to pay a minimum guarantee to the producer of the content. Revenue received in excess of such minimum guarantee is shared between us and the producer, according to terms of the relevant distribution agreement. Content Production Costs Content production costs relate to our television and film content production and distribution business and consist of costs such as equipment rental, location rental, artist costs, other technical and profession personnel hiring and other incidental expenses at film and television content production locations. Electricity, power and water charges

503

Electricity, power and water charges are mainly pertaining to our theatrical exhibition business, wherein we incur cost of utilities for operation of our theatres and also include cost of diesel for operation of generators for backup power at our cinemas and facilities. Employee Benefits Expense Employee benefits expenses consist primarily of expenses incurred towards payment of salaries, allowances and bonuses, contributions to the employees’ provident fund and other welfare funds, gratuity and leave encashment and other staff welfare expenses. Our employee benefits expenses have grown and are expected to continue to grow, primarily due to the increase in the number of cinema theatres we operate and the expansion of our new businesses. Other Expenses Other expenses primarily include rent, legal and professional expenses, expenses for advertising and business promotion, travelling and conveyance expenses, communication expenses, electricity charges, office, printing and stationary expenses. Rent Lease rent for theatrical exhibition is a major component of our cost. Finance Costs Our finance costs include interest and charges payable on borrowings and loss on derivative contracts. Interest primarily includes interest on borrowings paid to banks and financial institutions and interest paid to corporate lenders on inter-corporate deposits. We borrow primarily to meet our capital expenditure requirements and meet working capital shortfalls. Finance costs also include bank guarantee commissions paid to banks towards guarantees given to our Subsidiaries, regulatory authorities and other officials in various states. Depreciation and Amortisation Expense We incur capital expenditure on lease improvements, plant and machinery, air conditioning equipment, theatrical equipment, data processing equipment and office equipment. In our theatrical exhibition business, our plant and machinery include, among others, our projectors, sound system equipment and equipment used for our concession counters in our cinema theatres. In our film production services business, our plant and machinery include, among others, laboratory equipment used for processing of film negatives, scanners for the processing of exposed film, subtitling equipment and cameras for our equipment rental business. Immoveable assets at our leased premises, which include civil works and electrical items, are capitalised as leasehold assets and are amortised over the primary period of lease. Depreciation is provided on the basis of “Straight Line Method”, at the rates specified in Schedule XIV of the Companies Act or the rates based on useful lives of the assets as estimated by the management, whichever is higher. Individual assets costing less than ` 0.05 lakhs are fully depreciated in the year of acquisition. The depreciation is provided on pro rata basis on the assets acquired, sold or disposed of during the relevant year. The annual depreciation rates are as provided below:

Asset Rate of Depreciation (%) Plant and machinery 7.07% to 20% Office equipment 10% Furniture and fixtures 10% to 25% Computers 20% Vehicles 10%

504

Taxation We are subject to income tax liability in India under the IT Act and overseas based on the relevant local laws of the particular jurisdiction. In India, pursuant to the provisions of the IT Act we may also be liable to pay Minimum Alternate Tax based on book profit. We make provision for current tax as well as for deferred tax liability based on our anticipated utilisation of tax charges carried forward. We have made necessary provisions for fringe benefit tax as well. Provision for Taxation Current Tax: Current tax is the provision made for income tax liability on the profits for the applicable financial period in accordance with applicable tax laws. Deferred Tax: Deferred tax arises from timing differences between book profits (accounting) and taxable profits that originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using tax rates and laws that have been enacted or substantially enacted as of the date of our balance sheet. Fringe Benefit Tax: In accordance with existing laws, we have provided for the necessary fringe benefit tax up to and including Fiscal 2009. 12 months ended March 31, 2012 compared to Fiscal 2011 Our financial year for 2012 has been extended to September 30, 2012. Accordingly, the comparison below is only for the 12 months from April 1, 2011 to March 31, 2012. To the extent mentioned above the restated consolidated financials of 12 months ended March 31, 2012 and Fiscal 2011 may not be directly comparable. Our results of operations for 12 months ended March 31, 2012 were primarily driven by the following key factors: (i). We started delivery for the Digital Domain contract from our centres in Mumbai, India and London, United

Kingdom. Further, during the year: i) We sold our entire shareholding in our subsidiary Sri Ramakrishna Theatres Limited and our Joint Venture

Cineplex Private Limited.

ii) We incorporated a new subsidiary Reliance Media Consultant Private Limited with effect from February 16, 2012.

Income Our total income declined marginally from ` 85,026.20 lakhs in Fiscal 2011 to ` 83,472.70 lakhs in the 12 months ended March 31, 2012, for the reasons mentioned below. Income from Operations Our income from our operations increased marginally by 3.20% to ` 81,744.90 lakhs for 12 months ended March 31, 2012 from ` 79,207.40 lakhs for Fiscal 2011, primarily on account of increase in revenue from theatrical exhibition and film production services. The following table provides comparison of our income from operations in the 12 months ended March 31, 2012 and Fiscal 2011:

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(In ` lakhs) Particulars 12 months ended March 31, 2012 Fiscal 2011

Amount % of Total Income

Amount % of Total Income

Theatrical exhibition business: Sale of tickets 43,692.60 52.34% 39,009.50 45.88% Entertainment tax (7,026.90) (8.42)% (5,098.90) (6.00)% Food and Beverage Sales 12,613.20 15.11% 10,716.70 12.60% Advertisements / Sponsorship revenue 2,290.80 2.74% 3,684.20 4.33% Others 3,932.90 4.71% 3,066.40 3.61% Total (a) 55,502.60 66.49% 51,377.90 60.42% Film Production Services Business: Processing / printing of films 16,473.00 19.73% 18,794.00 22.10% Equipment / facility rental income 2,430.90 2.91% 2,084.60 2.45% Trading income 999.10 1.20% 1,926.30 2.27% Others 94.90 0.11% 44.30 0.05% Total (b) 19,997.90 23.96% 22,849.20 26.87% Income from television / films distribution and production and related services (c) 6,244.40 7.48% 4,980.30 5.86% Total Income from Operations (a + b + c) 81,744.90 97.93% 79,207.40 93.16% Income from Theatrical Exhibition Business Income from theatrical exhibition business increased by 8.03% from ` 51,377.90 lakhs in Fiscal 2011 to ` 55,502.60 lakhs in 12 months ended March 31, 2012. This increase was primarily due to increase in admits in our cinema theatres and the release of a number of successful movies in the 12 months ended March 31, 2012. Our sale of tickets income increased by 12.00% from ` 39,009.50 lakhs in Fiscal 2011 to ` 43,692.60 lakhs in 12 months ended March 31, 2012. This increase was primarily due to increase in admits in our cinema theatres and the release of a number of successful movies in the 12 months ended March 31, 2012. Food and beverage sales income increased by 17.69% from ` 10,716.70 lakhs to ` 12,613.20 lakhs during 12 months ended March 31, 2012. In terms of percentage to the sale of tickets collections it increased from 27.47% in Fiscal 2011 to 28.87% during 12 months ended March 31, 2012 due to higher spending on food and beverages in our cinema theatres. Advertisement / sponsorship income decreased by 37.82% from ` 3,684.20 lakhs in Fiscal 2011 to ` 2,290.80 lakhs in the 12 months ended March 31, 2012. This decrease was primarily due to reduction in the advertisement inventory utilisation on account of lower demand from customers in view of the adverse economic and business conditions. Other exhibition business income increased by 28.26% from ` 3,066.40 lakhs in Fiscal 2011 to ` 3,932.90 lakhs in the 12 months ended March 31, 2012. This was primarily on account of increase in admits.

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Income from Film Production Services Business Our income from film production services business decreased by 12.48% from ` 22,849.20 lakhs in Fiscal 2011 to ` 19,997.90 lakhs during the 12 months ended March 31, 2012. Income from processing and printing of films decreased by 12.35% from ` 18,794.00 lakhs in Fiscal 2011 to ` 16,473.00 lakhs in the 12 months ended March 31, 2012, primarily due to reduction in analogue film processing at our facilities consequent to an industry wide shift towards digital prints. Income from equipment / facility rental income increased by 16.61% from ` 2,084.60 lakhs in Fiscal 2011 to ` 2,430.90 lakhs during the 12 months ended March 31, 2012 due to increased utilisations of our studio. One stage of our studio commenced operations only in January 2011. Our income from film negatives trading decreased by 48.13% from ` 1,926.30 lakhs in Fiscal 2011 to ` 999.11 lakhs for the 12 months ended March 31, 2012, primarily due to an industry wide shift towards digital prints. Other film production services income increased by 114.22% from ` 44.30 lakhs in Fiscal 2011 to ` 94.90 lakhs in the 12 months ended March 31, 2012. Income from Television / Film Content Production and Distribution business Our total income from our television / film content production and distribution business increased by 25.38%, from ` 4,980.03 lakhs in Fiscal 2011 to ` 6,244.40 lakhs in the 12 months ended March 31, 2012. The increase was primarily due to increase in higher content production by Big Synergy Media Limited, a subsidiary of our Company. Other Income Our other income decreased by 70.31% from ` 5,818.80 lakhs in Fiscal 2011 to ` 1,727.80 lakhs in the 12 months ended March 31, 2012. The increase in Fiscal 2011 was due to recovery of bad debts and profit on sale of fixed assets in Fiscal 2011. Expenditure

(In ` lakhs) Particulars 12 months ended March 31, 2012 Fiscal 2011

Amount % of Total Income

Amount % of Total Income

Direct operational expenses 32,615.60 39.07% 31,059.80 36.53% Employee benefits expense 21,741.10 26.05% 20,979.80 24.67% Other expenses 43,279.95 51.85% 34,672.96 40.78% Finance costs (net) 28,505.17 34.15% 17,514.20 20.60% Depreciation, amortisation and impairment expense 14,159.10 16.96% 13,226.50 15.56% Total Expenditure 140,300.92 168.08% 117,453.26 138.14% Our expenditure increased by 18.60% from ` 117,453.26 lakhs in Fiscal 2011 to ` 139,300.92 lakhs in the 12 months ended March 31, 2012, for the reasons detailed below. Direct Operating Expenses

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Direct operating expenses increased by 5.01% from ` 31,059.80 lakhs in Fiscal 2011 to ` 32,615.60 lakhs in the 12 months ended March 31, 2012. The key components of our Operating Expenses included the following:

Particulars 12 months ended March 31, 2012

Fiscal 2011

Amount (`̀ in lakhs)

% of Total Income

Amount (`̀ in lakhs)

% of Total Income

Distributors share 17,115.20 20.50% 16,027.20 18.85% Print, publicity expenses and Producers overflow

62.50 0.07% 253.30 0.30%

Cost of production for television content 3,565.10 4.27% 3,185.20 3.75% Electricity, power and water charges 5,753.00 6.89% 5,140.90 6.05% Cost of food and beverage sold 4,148.40 4.97% 3,382.40 3.98% Cost of raw films sold 881.50 1.06% 1,667.10 1.96% Processing charges 280.80 0.34% 332.10 0.39% Other direct operational expenses 809.10 0.97 % 1,071.60 1.26% Total 32,615.60 39.07% 31,059.80 36.53% Our revenues from television content have increased by 38.37% from ` 4,334.55 lakhs Fiscal 2011 to ` 5,997.77 lakhs in the 12 months ended March 31, 2012 and consequently, resulting in an increase of 11.93% in the cost of production of television content from ` 3,185.20 lakhs in Fiscal 2011 to ` 3,565.10 lakhs in the 12 months ended March 31, 2012. Costs pertaining to exhibition business – distributors share, cost of food and beverages sold and electricity, power and water charges have remained constant at approximately 50% of the exhibition business revenue. Our cost of food and beverages increased by 9.72% from ` 3,382.40 lakhs in Fiscal 2011 to ` 4,148.40 lakhs in the 12 months ended March 31, 2012 in proportion to the increase in consumption of food and beverages during the said period. Other direct expenses comprising consumables, show-tax etc. reduced by 24.50% from ` 1,071.60 lakhs in Fiscal 2011 to ` 809.10 lakhs in the 12 months ended March 31, 2012. Employee benefits expense Our employee benefits expenses increased marginally by 3.63% from ` 20,979.80 lakhs in Fiscal 2011 to ` 21,741.10 lakhs in the 12 months ended March 31, 2012 due to net impact of reduction in manpower and increments. As of March 31, 2012, we engaged 2,720 full-time employees and 2,077 workers on contract labour basis. Other Expenses Our other expenses increased by 24.82% from ` 34,672.96 lakhs in Fiscal 2011 to ` 43,279.95 lakhs in the 12 months ended March 31, 2012. This increase was primarily on account of increase in our rental cost and write off of carrying cost of capital work in progress due to settlement with owners of the cinema theatres with whom we had entered into business conducting agreements. Finance Costs Our finance costs increased by 62.75% from ` 17,514.21 lakhs in Fiscal 2011 to ` 28,505.17 lakhs in 12 months ended March 31, 2012, which was primarily due to losses on derivative contracts aggregating ` 5,966.70 lakhs recognised during the 12 months ended March 31, 2012 and increase in borrowing for funding our working capital and capital expenditure.

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Our borrowings decreased from ` 198,241.80 lakhs in Fiscal 2011 to ` 173,520.10 lakhs in 12 months ended March 31, 2012. We had borrowed a sum of Rs. 29,500 lakhs from Reliance Utility Engineers Private Limited and Reliance Infocomm Engineering Private Limited in the 12 months ended March 31, 2012 towards repaying some of our outstanding obligations. These loans were subsequently converted to preference shares on March 31, 2012, thereby reducing our outstanding borrowings. Depreciation, amortisation and impairment expense Depreciation, amortisation and impairment expense increased by 7.05% from ` 13,226.50 lakhs in Fiscal 2011 to ` 14,159.10 lakhs in the 12 months ended March 31, 2012, primarily as a result of the capital expenditure incurred during the 12 months ended March 31, 2012 and new operations that were commenced during Fiscal 2011. Tax Tax expenses reduced from Rs. 566.59 lakhs in Fiscal 2011 to Rs. (12.69) lakhs in the 12 months ended March 31, 2012 due to reversal of deferred tax recognised by us in earlier periods. Minority Interest Share of the minority interest in our losses was ` 401.10 lakhs in the 12 months ended March 31, 2012 as compared to ` (196.70) lakhs in Fiscal 2011. (Loss)/Profit After Minority Interest After Adjustments pursuant to Schemes Loss after minority interest after adjustments pursuant to Schemes increased by 74.46% from ` 32,796.95 lakhs in Fiscal 2011 to ` 57,216.63 lakhs in the 12 months ended March 31, 2012 due to the reasons mentioned above. Fiscal 2011 Compared to Fiscal 2010 Our results of operations for Fiscal 2011 were primarily driven by the following key factors: (ii). Increase in the number of screens to 543 as of March 31, 2011 from 508 as of March 31, 2010; and (iii). Commencement, in Fiscal 2011, of commercial operation of our subsidiary Reliance MediaWorks

Entertainment Services Limited, which is engaged in the business of film restoration and conversion. This contributed to the improvement in our revenues from film production services during Fiscal 2011.

Additionally, during the year our subsidiaries Adlabs Heritage LLC and Adlabs Digital Media LLC were dissolved and we acquired additional 49% stake in our subsidiary Big Cinemas Galaxy LLC, whereupon it became our wholly owned subsidiary. Consequently, to this extent, the restated consolidated financial statements for Fiscal 2011 may not be directly comparable with the financial statements for Fiscal 2010. Income Our total income increased by 13.73% to ` 85,026.20 lakhs for Fiscal 2011 from ` 74,763.90 lakhs for Fiscal 2010, primarily as a result of increase in revenue from theatrical exhibition and film production services, which was partially offset by a decrease in income from television and film content production and distribution. Income from Operations Our income from our operations increased by 10.77% to ` 79,207.40 lakhs for Fiscal 2011 from ` 71,507.20 lakhs for Fiscal 2010, primarily as a result of increase in revenue from theatrical exhibition and film production services, which was partially offset by a decrease in income from television and film content production and distribution. The following table provides details of our income from operations for Fiscals 2011 and 2010:

(` in lakhs) Particulars Fiscal 2011 Fiscal 2010

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Amount % of Total Income

Amount % of Total Income

Theatrical exhibition business: Sales of tickets 39,009.50 45.88% 34,706.70 46.42% Entertainment Tax (5,098.90) (6.00%) (3,958.20) (5.29%) Food and Beverage Sales 10,716.70 12.60% 8,722.30 11.67% Advertisements 3,684.20 4.33% 4,651.70 6.22% Others 3,066.40 3.61% 2,587.50 3.46% Total Theatrical Exhibition Business Income 51,377.90 60.42% 46,710.00 62.48% Film Production Services Business: Processing and Printing of Film 18,794.00 22.10% 11,486.40 15.36% Equipment and facilities rental income 2,084.60 2.45% 1,566.50 2.10% Film Negatives Trading 1,926.30 2.27% 2,229.30 2.98% Others 44.30 0.05% 72.30 0.10% Total Film Production Services Business Income 22,849.20 26.87% 15,354.50 20.54% Total Television and Film Content Production and Distribution Income

4,980.30 5.86% 9,442.70 12.63%

Total Income from Operations 79,207.40 93.16% 71,507.20 95.64% Income from Theatrical Exhibition Business Our total income from our theatrical exhibition business increased by 9.99% to ` 51,377.90 lakhs for Fiscal 2011 from ` 46,710.00 lakhs for Fiscal 2010, primarily as a result of increase in the number of screens under operation and the average realisations from theatres. The number of our properties increased to 146 as of March 31, 2011 from 140 as of March 31, 2010. Due to the increase in our properties, our screens under operation increased to 543 screens as of March 31, 2011 from 508 screens as of March 31, 2010. In addition to the increase in the number of properties, we also derived realisations for full 12 months of Fiscal 2011 from 20 properties which had commenced operations during Fiscal 2010. Our sale of tickets collections income increased by 12.40% to ` 39,009.50 lakhs for Fiscal 2011 from ` 34,706.70 lakhs for Fiscal 2010, primarily as a result of increase in the number of screens under operation and average realisation from theatres due to an increase in the number of multiplexes and an improvement in the business environment. Food and beverage sales income increased by 22.86% to ` 10,716.70 lakhs for Fiscal 2011 from ` 8,722.30 lakhs for Fiscal 2010, primarily due to the launch of new food products and combinations of food and beverages made available through a new menu at our cinema theatres. Advertisement sponsorship income decreased by 20.80% to ` 3,684.20 lakhs for Fiscal 2011 from ` 4,651.70 lakhs for Fiscal 2010, mainly due to the decrease in advertising expenditure incurred by our clients in view of adverse business and economic conditions. Income from our other theatrical exhibition business increased by 18.51% from to ` 3,066.40 lakhs in Fiscal 2011 from ` 2,587.50 lakhs in Fiscal 2010. Our other theatrical exhibition business mainly comprises of income from parking and kiosk rentals. The increase in our income from other theatrical exhibition business was primarily on account of increase in footfalls and the number of our screens under operation. Income from Film Production Services Business Our total income from our film production services business increased by 48.81% to ` 22,849.20 lakhs for Fiscal 2011 from ` 15,354.50 lakhs for Fiscal 2010, primarily as a result of growth in business related to digital

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conversion, movie restoration and equipment renting. Additionally, our subsidiary, Reliance MediaWorks Entertainment Services Limited commenced operations in Fiscal 2011 and generated an income of ` 4,293.37 lakhs. Our income from processing and printing of films increased by 63.62% to ` 18,794.00 lakhs for Fiscal 2011 from ` 11,486.40 lakhs for Fiscal 2010 due to an improvement in our analogue film processing. During Fiscal 2011 we processed 372,484,000 feet of films as compared to 358,387,000 feet in Fiscal 2010. Consequently our income from processing of films increased to ` 5,978.75 lakhs in Fiscal 2011 from ` 5,680.03 lakhs in Fiscal 2010. Our income from equipment and facility rental increased by 33.07% to ` 2,084.60 lakhs for Fiscal 2011 from ` 1,566.50 lakhs for Fiscal 2010, primarily as a result of completion of phase I of our new studio facility in January 2011 and consequent commencement of its renting. Our income from film negatives trading decreased by 13.59% to ` 1,926.30 lakhs for Fiscal 2011 from ` 2,229.30 lakhs for Fiscal 2010, primarily as a result of decrease in the number of cans of negative sold from 18,41,000 cans in Fiscal 2010 to 13,75,800 cans in Fiscal 2011. Our other film services income decreased by 38.73% to ` 44.30 lakhs in Fiscal 2011 from ` 72.30 lakhs in Fiscal 2010 primarily due to income from digital restoration and related services provided by us, which commenced during the Fiscal 2011. Income from Television and Film Content Production and Distribution Business Our total income from our television and film content production and distribution business decreased by 47.26% to ` 4,980.30 lakhs for Fiscal 2011 from ` 9,422.70 lakhs for Fiscal 2010, primarily as a result of reduction in the number of movies distributed by us in Fiscal 2011. Other Income Our other income increased by 78.67% to ` 5,818.80 lakhs for Fiscal 2011 from ` 3,256.70 lakhs for Fiscal 2010, primarily as a result of the profit realised on sale of fixed assets amounting to ` 2,694.80 lakhs, which were leased back subsequently, and recovery of bad debts or provision written back amounting to ` 1,405.50 lakhs in Fiscal 2011. Expenditure

(` in lakhs) Particulars Fiscal 2011 Fiscal 2010

Amount % of Total Income

Amount % of Total Income

Direct Operational Expenses 31,059.80 36.53% 28,102.00 37.59% Employee benefits expense 20,979.80 24.67% 13,179.30 17.63% Other expenses 34,672.96 40.78% 25,317.05 33.86% Finance costs (net) 17,514.20 20.60% 11,717.20 15.67% Depreciation, amortisation and impairment expense

13,226.50 15.56% 9,729.44 13.01%

Total Expenditure 117,453.26 138.14% 88,044.99 117.76% Our expenditure increased by 33.40% to ` 117,453.26 lakhs for Fiscal 2011 from ` 88,044.99 lakhs for Fiscal 2010, primarily as a result of increases in direct operational expenses, employee benefits expenses and administrative and other expenses, and finance costs (net). Direct Operational Expenses The key components of our direct operational expenses are detailed in the following table:

(` in lakhs) Particulars Fiscal 2011 Fiscal 2010

511

Amount % of Total Income

Amount % of Total Income

Distributors’ share 16,027.20 18.85% 15,782.50 21.11% Print, publicity expenses and producers overflow 253.30 0.30% 333.80 0.45% Cost of production for television content 3,185.20 3.75% 1,915.60 2.56% Electricity, power and water charges 5,140.90 6.05% 4,173.90 5.58% Cost of food and beverage sold 3,382.40 3.98% 2,618.30 3.50% Cost of raw films sold 1,667.10 1.96% 2,007.00 2.68% Processing charges 332.10 0.39% 509.00 0.68% Other Direct Expenses 1,071.60 1.26% 761.90 1.02% Total 31,059.80 36.53% 28,102.00 37.59% Direct operational expenses increased by 10.53% to ` 31,059.80 lakhs for Fiscal 2011 from ` 28,102.00 lakhs for Fiscal 2010. This increased primarily as a result of increases in Fiscal 2011 in (i) the cost of production for television content caused by an increase in the content production and distribution undertaken by us during this Fiscal, (ii) utilities charges due to increased cost of fuel and other inputs and an increase in the number of screens operated by us, (iii) and an increase in cost of food and beverages sold resulting from the increase in the number of screens operated by us customer footfalls. Employee benefits expense Our employee benefits expenses increased by 59.19% to ` 20,979.80 lakhs for Fiscal 2011 from ` 13,179.30 lakhs for Fiscal 2010, primarily as a result of an increase in the number of employees to 6,644 as of March 31, 2011 as compared to 5,634 as of March 31, 2010 due to the commencement of our production and post-production services for television commercials, VFX services, studio located at the Film City, Mumbai, and digital conversion and restoration services. Other Expenses Our administrative and other expenses increased by 36.96% to ` 34,672.96 lakhs for Fiscal 2011 from ` 25,317.05 lakhs for Fiscal 2010, primarily as a result of increases in costs due to rent and miscellaneous costs. Finance Charges Our finance costs (net) increased by 49.47% to ` 17,514.20 lakhs for Fiscal 2011 from ` 11,717.20 lakhs for Fiscal 2010, primarily as a result of utilisation of borrowed funds for capital expenditure. Additionally, during Fiscal 2011, the interest rate on our borrowing increased, we incurred expenditure on the interest rate swap for hedging the interest rates on our long term syndicated bank loan and we incurred foreign exchange loss due to redemption of FCCBs. Depreciation, amortisation and impairment expense Depreciation, amortisation and impairment expense increased by 35.94% to ` 13,226.50 lakhs for Fiscal 2011 from ` 9,729.44 lakhs for Fiscal 2010, primarily as a result of increase in our assets due to the capital expenditure incurred and full year utilisation of certain assets during Fiscal 2011. Tax Tax increased by 954.37% to ` 566.59 lakhs for Fiscal 2011 from ` 52.86 lakhs for Fiscal 2010, primarily as a result of deferred tax, which increased to ` 452.69 lakhs for Fiscal 2011 as from ` 13.25 lakhs for Fiscal 2010. Minority Interest Share of the minority interest in our losses was ` 196.70 lakhs for Fiscal 2011 as compared to ` 530.87 lakhs for Fiscal 2010.

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(Loss)/Profit After Minority Interest After Adjustments Pursuant to Schemes Loss after minority interest before adjustments increased to ` 32,796.95 lakhs for Fiscal 2011 from ` 12,803.08 lakhs for Fiscal 2010, primarily as a result of increases in employee benefits expenses, administrative and other expenses, finance costs (net) and depreciation, amortisation and impairment expense. Fiscal 2010 Compared to Fiscal 2009 Our results of operations for Fiscal 2010 were primarily driven by the following key factors: (i). the expansion of our theatrical exhibition business; (ii). the acquisition of assets related to processing laboratory acquired by us from Vectrox Limited; and (iii). the expansion of our equipment rental business. Additionally, during the year our subsidiaries BIG Cinemas Union LLC and Adlabs Forum LLC were dissolved, we acquired 100% stake in Reliance MediaWorks Entertainment Services Limited, whereupon it became our wholly owned subsidiary, we registered three new subsidiaries being Reliance Media Works VFX Inc., Adlabs Globalstar LLC and Reliance Media and Marketing Communications LLC, we purchased the balance 10% of the outstanding shares of Reliance Lowry Digital Imaging Services Inc., pursuant to which it became our wholly owned subsidiary and we diluted our shareholding in BIG Cinemas Sahil LLC by 3%. Consequently, to this extent, the restated consolidated financial statements for Fiscal 2010 may not be directly comparable with the financial statements for Fiscal 2009. Income Our total income increased by 2.25% to ` 74,763.90 lakhs for Fiscal 2010 from ` 73,120.24 lakhs for Fiscal 2009, primarily as a result of an increase in our total theatrical exhibition business income by 40.82% to ` 46,710.00 lakhs for Fiscal 2010 from ` 33,171.14 lakhs for Fiscal 2009, an increase in film production services income by 17.60% to ` 15,354.50 lakhs for Fiscal 2010 from ` 13,057.00 lakhs for Fiscal 2009, which was partially offset by a decrease in our total television and film content production and distribution income by 52.09% to ` 9,442.70 lakhs for Fiscal 2010 from ` 19,707.20 lakhs for Fiscal 2009. Income from Operations Our income from our operations increased by 8.45% to ` 71,507.20 lakhs for Fiscal 2010 from ` 65,935.34 lakhs for Fiscal 2009, primarily as a result of increases in our total theatrical exhibition business income and film production services income, which, was partially offset by a decrease in our total television and film content production and distribution income. The following table provides details of our income from operations for Fiscals 2010 and 2009:

(` in lakhs) Particulars Fiscal 2010 Fiscal 2009

Amount % of Total

Income

Amount % of Total

Income Theatrical exhibition business: Sale of tickets 34,706.70 46.42% 25,864.40 35.37% Entertainment Tax (3,958.20) (5.29)% (2,288.70) (3.13)% Food and Beverage Sales 8,722.30 11.67% 6,470.34 8.85% Advertisements / Sponsorship 4,651.70 6.22% 1,465.20 2.00% Others 2,587.50 3.46% 1,659.90 2.27% Total Theatrical Exhibition Business Income 46,710.00 62.48% 33,171.14 45.37

Film Production Services Business: Processing and Printing of Film 11,486.40 15.36% 9,299.80 12.72% Equipment/ Facility Rental 1,566.50 2.10% 612.40 0.84% Film Negatives Trading 2,229.30 2.98% 3,077.40 4.21%

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Particulars Fiscal 2010 Fiscal 2009 Amount % of

Total Income

Amount % of Total

Income Others 72.30 0.10% 67.40 0.09% Total Film Production Services Business Income 15,354.50 20.54% 13,057.00 17.86%

Total Television and Film Content Production and Distribution Income

9,442.70 12.63% 19,707.20 26.95%

Total Income from Operations 71,507.20 95.64% 65,935.34 90.17% Income from Theatrical Exhibition Business Our total income from our theatrical exhibition business increased by 40.82% to ` 46,710.00 lakhs for Fiscal 2010 from ` 33,171.14 lakhs for Fiscal 2009, primarily as a result of an increase in the scale of our operations in India and the effect of accruing a full year of revenue for our theatrical exhibition business operations in Malaysia. Our number of properties increased to 140 properties as of March 31, 2010 from 115 properties as of March 31, 2009. Our number of screens increased to 508 screens as of March 31, 2010 from 429 screens as of March 31, 2009. Our sale of tickets collections income increased by 34.19% to ` 34,706.70 lakhs for Fiscal 2010 from ` 25,864.40 lakhs for Fiscal 2009, primarily as a result of an increase in the number of our cinema theatres in India and the effect of accruing a full year of revenue for our theatrical exhibition business operations in Malaysia. Food and beverage sales income increased by 34.80% to ` 8,722.30 lakhs for Fiscal 2010 from ` 6,470.34 lakhs for Fiscal 2009, primarily as a result of an increase in the number of our cinema theatres and an improved menu. Advertisement sponsorship income increased by 217.48% to ` 4,651.70 lakhs for Fiscal 2010 from ` 1,465.20 lakhs for Fiscal 2009, primarily as a result of increased monetisation of available space in the Indian and overseas markets and the launch of several initiatives for co-branding and promotion of our products. Income from Film Production Services Business Our total income from our film production services business increased by 17.60% to ` 15,354.50 lakhs for Fiscal 2010 from ` 13,057.00 lakhs for Fiscal 2009, primarily as a result of our expansion into new business areas such as equipment rental. Our income from the processing and printing of film increased by 23.51% to ` 11,486.40 lakhs for Fiscal 2010 from ` 9,299.80 lakhs for Fiscal 2009, primarily as a result of the full year effect of the acquisition of our Subsidiary, Lowry Digital. Our income from equipment rental increased by 155.80% to ` 1,566.50 lakhs for Fiscal 2010 from ` 612.40 lakhs for Fiscal 2009, primarily as a result of an increase in the number of cameras we rented and the rental of specialised equipment. Our income from film negatives trading decreased 27.56% to ` 2,229.30 lakhs for Fiscal 2010 from ` 3,077.40 lakhs for Fiscal 2009, primarily as a result of reduction in sales volume. Income from Television and Film Content Production and Distribution Business Our total income from our television and film content production and distribution business decreased by 52.09% to ` 9,442.70 lakhs for Fiscal 2010 from ` 19,707.20 lakhs for Fiscal 2009, primarily as a result of the non-availability of popular, large-budget content. Other Income

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Our other income decreased by 54.67% to ` 3,256.70 lakhs for Fiscal 2010 from ` 7,184.90 lakhs for Fiscal 2009, primarily as a result of reduced income from, among other sources, dividends, the sale of long term investments and consultation fees. Expenditure

(` in lakhs) Particulars Fiscal 2010 Fiscal 2009

Amount % of Total Income

Amount % of Total Income

Direct Operational Expenses 28,102.00 37.59% 23,868.30 32.64% Employee benefits expense 13,179.30 17.63% 10,147.60 13.88% Other Expenses 25,317.05 33.86% 20,056.90 27.43% Finance costs (net) 11,717.20 15.67% 12,447.20 17.02% Depreciation, amortisation and impairment expense

9,729.44 13.01% 13,542.41 18.52%

Total Expenditure 88,044.99 117.76% 80,062.41 109.49% Our expenditure increased by 9.97% to ` 88,044.99 lakhs for Fiscal 2010 from ` 80,062.41 lakhs for Fiscal 2009, primarily as a result of increases in direct operational expenses, employee benefits expenses and administrative and other expenses, partially offset by a decrease in depreciation, amortisation and impairment expense. Direct Operational Expenses The key components of our direct operational expenses are detailed in the following table:

Particulars Fiscal 2010 Fiscal 2009 Amount

(`̀ in lakhs) % of Total

Income Amount

(`̀ in lakhs) % of Total

Income Distributors’ share 15,782.50 21.11% 8,758.10 11.98% Print, publicity expenses and Producers overflow

333.80 0.45% 2,029.20 2.78%

Cost of production for television content 1,915.60 2.56% 2,510.30 3.43% Electricity, power and water charges 4,173.90 5.58% 3,640.50 4.98% Cost of food and beverage sold 2,618.30 3.50% 2,020.70 2.76% Cost of raw films sold 2,007.00 2.68% 3,008.70 4.11% Processing charges 509.00 0.68% 1,331.40 1.82% Other Direct Expenses 761.90 1.02% 569.40 0.78% Total 28,102.00 37.59% 23,868.30 32.64%

Direct operational expenses increased by 17.74% to ` 28,102.00 lakhs for Fiscal 2010 from ` 23,868.30 lakhs for Fiscal 2009, primarily as a result of an increase in amounts paid for distributors’ share caused by the addition of new cinema theatres. Employee benefits expense Our employee benefits expenses increased by 29.88% to ` 13,179.30 lakhs for Fiscal 2010 from ` 10,147.60 lakhs for Fiscal 2009, primarily as a result of an increase in the number of employees to 5,634 as of March 31, 2010 as compared to 2,382 as of March 31, 2009 to operate additional cinema theatres and the new businesses initiated by us during this Fiscal. Other Expenses Our administrative and other expenses increased by 26.23% to ` 25,317.05 lakhs for Fiscal 2010 from ` 20,056.90 lakhs for Fiscal 2009, primarily as a result of increases in costs due to rent, legal and professional fees, facility maintenance charges, labour charges, advertisement, repairs and miscellaneous costs.

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Finance Charges Our finance costs (net) decreased by 5.86% to ` 11,717.20 lakhs for Fiscal 2010 from ` 12,447.20 lakhs for Fiscal 2009, primarily as a result of lower expenditure on hedging of loans and interest and foreign exchange gain due to redemption of FCCBs, which was partially offset by an increase in the utilisation of borrowed funds for capital expenditure. Depreciation, amortisation and impairment expense Depreciation, amortisation and impairment expense decreased by 28.16% to ` 9,729.44 lakhs for Fiscal 2010 from ` 13,542.21 lakhs for Fiscal 2009, primarily as a result of a reduction in our amortisation cost of films due to a reduction in the number of films released during this Fiscal. Tax Tax decreased by 89.61% to ` 52.86 lakhs for Fiscal 2010 from ` 517.17 lakhs for Fiscal 2009, primarily as a result of withdrawal of the fringe benefit tax during this Fiscal 2010 as compared to charge of ` 171.70 lakhs for Fiscal 2009, deferred tax (net) was ` 13.25 lakhs for Fiscal 2010 as compared to a credit of ` 69.44 lakhs for Fiscal 2009 and lower profit, in accordance with the IT Act, in Big Synergy Media Limited. Minority Interest Share of the minority interest in our losses was ` 530.87 lakhs for Fiscal 2010 as compared to ` 322.12 lakhs for Fiscal 2009. (Loss)/Profit After Minority Interest After Adjustments and Pursuant to Schemes Loss after minority interest before adjustments increased to a loss of ` 12,803.08 lakhs for Fiscal 2010 from a loss of ` 7,786.52 lakhs for Fiscal 2009, primarily as a result increased interest costs, including losses from derivative contracts, depreciation, amortisation and impairment expense. Liquidity and Capital Resources We operate in a capital intensive industry. Our primary liquidity needs have been to finance our operations, working capital needs, acquisitions and expansions, dividend payments and debt servicing. We have historically funded such capital expenditures through a combination of internal cash flows and borrowings. The following table sets forth a summary of our cash flows for the 12 months ended March 31, 2012 and Fiscals 2011, 2010 and 2009:

(In ` lakhs)

12 months ended

March 31, 2012

Fiscal 2011 Fiscal 2010 Fiscal 2009 Net cash (used in) / generated from operating activities (1,245.52) (5,276.62) 5,294.43 1,565.71 Net cash generated from /(used in) investing activities 16,794.34 746.68 (46,562.73) (23,791.91) Net cash generated/(used in) financing activities (17,874.71) 5,414.50 41,993.29 23,650.40 Net increase/(decrease) in cash and cash equivalents (2,325.89) 884.56 724.99 1,424.20 Cash in the form of bank deposits, current account balances and cash on hand represents our cash and cash equivalents.

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Net cash generated from Operating Activities Net cash used in operations in the 12 months ended March 31, 2012 was ` 1,245.52 lakhs primarily due to higher losses incurred by the Company in the 12 months ended March 31, 2012. Net cash used in operations in Fiscal 2011 was ` 5,276.62 lakhs, primarily as a result of higher losses incurred during Fiscal 2011. In Fiscal 2010 we generated ` 5,294.43 lakhs as net cash from operating activities, primarily as a result of a smaller increase in sundry debtors and greater finance costs (net), partially offset by a larger net loss before tax and an increase in loans and advances. Net cash used in operations in Fiscal 2009 was ` 1,565.71 lakhs primarily due to increase in sundry debtors, trade payments and loss during the year. Net cash generated from Investing Activities Net cash from investing activities was ` 16,794.34 lakhs in the 12 months ended March 31, 2012 primarily due to receipt of proceeds towards advance against sale of fixed assets. Net cash generated from investing activities was ` 746.68 lakhs in Fiscal 2011. Key investments during Fiscal 2011 included, purchase of fixed assets of ` 22,335.80 lakhs and redemption of mutual fund units aggregating ` 7,983.98 lakhs. Net cash used in investing activities was ` 46,562.73 lakhs in Fiscal 2010. Key investments during Fiscal 2010 comprised of purchase of fixed assets of ` 40,917.60 lakhs and investments in mutual fund units aggregating ` 7,982.03 lakhs. Net cash used in investing activities was `(23,791.91) lakhs in Fiscal 2009, which primarily consisted of the purchase of fixed assets aggregating ` 35,911.00 lakhs and amounts paid for acquisition of companies which are, presently, our subsidiaries aggregating ` 7,861.20 lakhs, partially offset by proceeds on the sale of long term investments/rights therein of ` 3,127.30 lakhs and redemption of mutual fund units aggregating ` 13,556.69 lakhs . Net cash generated from Financing Activities Net cash used in financing activities was ` 17,874.71 lakhs during 12 months ended March 31, 2012 due to repayment of debts during the period of ` 24,565.12 lakhs, which was offset by funds raised through issue of 10%, 29,50,000 Redeemable Non Convertible Preference Shares of `5 each at a price of ` 1,000 aggregating ` 29,500 lakhs. Net cash generated from financing activities in Fiscal 2011 was ` 5,414.50 lakhs. During Fiscal 2011, we raised ` 37,500 lakhs from long term borrowings and repaid ` 18,292.40 lakhs and ` 13,333.30 lakhs towards short term loans (net) and long term borrowings, respectively. Net cash generated from financing activities was ` 41,993.29 lakhs in Fiscal 2010, which primarily consisted of proceeds from short term borrowings (net) of ` 52,962.60 lakhs and proceeds from long term borrowings of ` 5,489.00 lakhs, partially offset by interest expense and finance charges (net) of ` 13,414.80 lakhs. Net cash generated from financing activities was ` 23,650.40 lakhs in Fiscal 2009, which primarily consisted of proceeds from short term borrowings (net) of ` 31,271.20 lakhs and proceeds from long term borrowings of ` 7,826.10 lakhs, partially offset by interest expense and finance charges (net) of ` 11,287.10 lakhs, and payment of dividend of `1,574.90 lakhs.

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Contingent Liabilities For details in relation to our contingent liabilities, please see the chapter entitled “Financial Statements” on page 188. Indebtedness For details in relation to the Company’s indebtedness, please see the chapter entitled “Financial Indebtedness” on page 475. Capital Commitments and Lease Obligations For details in relation to our Capital Commitments and Lease Obligations, please see the chapter entitled “Financial Statements” at page 188. Off-Balance Sheet Arrangements Derivative Instruments We had a derivative contract for interest rate swap outstanding as of March 31, 2012 which was assigned to an assignee which had advised our Company with regards to entering into the derivative contract. Subsequently, on April 3, 2012, our Company cancelled the derivative contract and the cancellation charges for the same were paid by our Company. Capital Expenditure Historical Capital Expenditure The following table sets forth our historical capital expenditure by segment for the 12 months ended March 31, 2012 and Fiscals 2011, 2010 and 2009:

(In ` lakhs) Particular

s 12 months ended March 31, 2012

Fiscal 2011 Fiscal 2010 Fiscal 2009

Amount % of Total Capital Expenditure

Amount % of Total Capital Expenditure

Amount % of Total

Capital Expendi

ture

Amount % of Total Capital

Expenditure

Theatrical Exhibition 2,488.60 39.19 5,860.10 26.16 18,905.70 43.87 36,854.70 88.05 Film Production Services 3,786.50 59.63 16,464.20 73.49 23,533.80 54.61 4,810.90 11.50 Television and Film Content Production and Distribution 23.10 0.36 19.20

0.09 483.20 1.12 - -

Unallocated 51.90 0.82 58.70

0.26 168.60 0.40 186.30 0.45

Total 6,350.10 100.00 22,402.20

100.00 43,091.30 100.00 41,851.90 100.00

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Related Party Transactions For details of the related party transactions, please see the chapter entitled “Financial Statements - Statement of Related Party Transactions” at page 188. Quantitative and Qualitative Disclosure about Market Risk Market risk is the risk of loss related to adverse changes in market prices, including interest rate and foreign exchange rates of financial instruments. We are exposed to various types of market risks, in the normal course of our business. The following discussion and analysis, which constitute “forward-looking statements” that involve risk and uncertainties, summarise our exposure to different market risks. 1. Unusual or Infrequent Events or Transactions

Except as described in this Draft Letter of Offer, there have been no other events or transactions that, to the knowledge of the management of our Company, may be described as “unusual” or “infrequent”.

2. Significant Economic Changes

Other than as mentioned under the part “Factors Affecting Results of Performance” in this chapter, to the knowledge of the management of our Company, there are no other significant economic changes that materially affect or are likely to affect income from continuing operations.

3. Known Trends or Uncertainties

Our business has been affected and we expect will continue to be affected by the trends identified above in the part entitled “Factors Affecting our Results of Operations and Financial Condition” and the uncertainties described in the chapter entitled “Risk Factors” at page 11. To our knowledge, except as described or anticipated in this Draft Letter of Offer, there are no known factors which we expect will have a material adverse impact on our revenues or income from continuing operations.

4. Future Relationship Between Costs and Income

Other than as described elsewhere in this Draft Letter of Offer, particularly in this chapter, to the knowledge of the management of our Company, there are no known factors that might affect the future relationship between costs and revenues.

5. Material Increases in Net Sales or Revenue due to Increased Sales Volume, Introduction of New Products or Services, or Increased Sales Prices

Changes in revenues during the last three years are as explained in the part “Fiscal 2011 compared to Fiscal 2010” and “Fiscal 2010 compared to Fiscal 2009” in this chapter.

6. Total Turnover of Each Major Industry Segment in Which the Issuer Company Operated

We operate in the media and entertainment industry. We currently operate in three business segments; namely theatrical exhibition, film production services facility and television / film production and distribution. Relevant published data, as available, has been included in the chapter entitled ‘Industry Overview’ at page 99 of this Draft Letter of Offer.

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7. Status of Any Publicly Announced New Products or Business Segment

Except as described in this chapter and the chapters entitled ‘Our Business’ and ‘Risk Factors’ at pages 111 and 11, respectively, of this Draft Letter of Offer, there are currently no publicly announced new products or business segments.

8. Seasonality of Business

Our business is not seasonal. Our business is largely dependent on the state of economy and overall economic conditions prevailing both locally and globally. The level of our operations, income and profitability may be affected by these factors. For further details in this regard, please see the chapter entitled ‘Risk Factors’ at page 11 of this Draft Letter of Offer.

9. Supplier or Customer Concentration

Our business is not significantly dependent on any of our suppliers or customers. 10. Competitive Conditions

We have many competitors who are present in the exhibition, film processing, TV content production, equipment rental, digital intermediate lab, digital cinema mastering and restoration business. In the future we may also face competition from global entertainment companies who may establish operations in India. Besides, our exhibition business is subject to varying degrees of competition in the geographic areas in which we operate. These competitors may be national players, regional players or smaller independent exhibitors. For further details in this regard, please see the chapter entitled ‘Risk Factors’ at page 11 of this Draft Letter of Offer.

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STOCK MARKET DATA

The Equity Shares of our Company have been listed on the BSE and the NSE since January 8, 2001 and January 10, 2001, respectively. The tables below set forth, for the periods indicated the high, low and average closing prices and the trading volumes on the BSE and the NSE for our Company’s Equity Shares. As on the date of this Draft Letter of Offer, 4,61,26,170 Equity Shares have been issued and are fully paid up. The following tables set forth the reported high, low and average of the closing prices of the Equity Shares of our Company on the BSE and the NSE traded on the days such high and low prices were recorded for the fiscal years 2009, 2010, 2011 and for 12 months ended March 31, 2012. BSE

12 months ended March

31

High (`) Date of High Volume on date of High

Low (`) Date of Low

Volume on date of

Low

Average Price (`)

2010 441.80 June 5, 2009 13,68,853 178.20 April 1, 2009

4,83,425 291.50

2011 292.95 October 5, 2010

81,19,349 129.90 February 9, 2011

5,65,558 204.90

2012 183.35 April 5, 2011 25,31,454 67.90 December 20, 2011

49,806 104.80

(Source: www.bseindia.com) NSE

12 months ended March

31

High (`) Date of High Volume on date of High

Low (`)

Date of Low

Volume on date of

Low

Average Price (`)

2010 358.90 October 20, 2009

3,69,377 204.50 February 25, 2010

3,82,789 255.80

2011 292.90 October 11, 2010

2,28,37,038 129.90 February 9, 2011

18,73,391 205.10

2012 183.55 April 5, 2011 51,80,438 67.90 December 20, 2011

1,38,119 104.80

(Source: www.nse-india.com) Notes

High, Low and average prices are of the daily closing prices. In case of two days with the same closing price, the date with higher volume has been considered.

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The following tables set forth the reported high, low and average closing prices of our Equity Shares recorded on the BSE and the NSE and the number of Equity Shares traded on the days such high and low prices were recorded and the volume of Equity Shares traded in each month during the last six months. BSE

Month High (`) Date of High

Volume on date of High

Low (`) Date of Low

Volume on date of

Low

Average Price (`)

January 2012 93.30 January 13, 2012

17,86,666 68.70 January 2, 2012

40,548 80.40

February 2012 91.30 February 21, 2012

30,870 78.40 February 27, 2012

15,961 85.50

March 2012 94.30 March 5, 2012

4,65,309 73.10 March 28, 2012

78,206 83.50

April 2012 84.60 April 3, 2012

1,89,254 73.10 April 27, 2012

21,261 79.50

May 2012 72.80 May 2, 2012

35,624 49.70 May 31, 2012

90,111 61.50

June 2012 56.55 June 29, 2012

2,18,736 51.00 June 1, 2012

2,25,698 53.78

(Source: www.bseindia.com) NSE

Month High (`) Date of High

Volume on date of High

Low (`) Date of Low

Volume on date of

Low

Average Price (`)

January 2012 92.90 January 13, 2012

32,54,647 68.60 January 2, 2012

1,21,746 80.40

February 2012 91.60 February 21, 2012

92,595 78.20 February 27, 2012

35,988 85.70

March 2012 94.50 March 5, 2012

84,38,61 73.20 March 28, 2012

1,04,542 83.50

April 2012 84.70 April 3, 2012

3,42,189 73.30 April 27, 2012

41,112 79.50

May 2012 73.30 May 2, 2012

57,983 49.80 May 31, 2012

1,69,241 61.50

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Month High (`) Date of High

Volume on date of High

Low (`) Date of Low

Volume on date of

Low

Average Price (`)

June 2012 56.70 June 29, 2012

3,43,240 50.95 June 1, 2012

3,21,200 53.90

(Source: www.nseindia.com) Notes

High, Low and average prices are of the daily closing prices. In case of two days with the same closing price, the date with higher volume has been considered.

The closing prices of our Equity Shares on the BSE and the NSE on July 26, 2012, the trading day immediately following the day on which the resolution of the Board to approve the Issue was passed, were `57.50 and `57.60 per Equity Share, respectively.

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MATERIAL DEVELOPMENTS Recent Developments In accordance with circular no.F.2/5/SE/76 dated February 5, 1977 issued by the Ministry of Finance, Government of India, and as amended by Ministry of Finance, Government of India through its circular dated March 8, 1977, the information required to be disclosed for the period between the last date of the financial statements provided to the shareholders and the date preceding one month from the date of this Draft Letter of Offer is provided below: 1. Working results of our Company on a stand-alone basis for the period from April 1, 2012 to May 31,

2012:

Particulars Amount (In ` lakhs) Total sales/ turnover 7,995.56 Other operating income 1,194.94 Total income 9,190.50 EBITDA 568.65 Interest/ finance charges (net) (6,001.67) Provision for depreciation (1,192.74) Provision for tax - Profit after tax (6,625.76) *Interest/ finance charges (net) include loss on derivative contracts of ` 2,435.27 lakhs, which has been accounted in the restated summary financial statements, more detailed information in the section entitled “Financial Information” at page 188. 2. Material changes and commitments, if any, affecting the financial position of our Company: There are no material changes and commitments, other than as disclosed in this Draft Letter of Offer, which are likely to affect the financial position of our Company since March 31, 2012 (i.e. last date up to which audited information is incorporated in this Draft Letter of Offer). 3. Pursuant to approval of the RoC dated June 28, 2012 our financial year for 2012 has been extended to

September 30, 2012.

4. Our Company has executed share purchase deed dated May 3, 2012 with a local buyer to sell the shares of Rave Entertainment and Food Nepal Private Limited at face value. The Company in accordance with applicable Nepali law, has, subsequently, sought the approval of the Department of Industries, Nepal for the said sale. The application is pending.

5. Our Company has, on July 17, 2012, executed an indicative non-binding term sheet with a private equity fund to acquire a substantial minority stake through an investment of `60,500 lakhs in our Company’s film and media services division. The investment is proposed to be made into the subsidiary of our Company, into which our film and media services division will be transferred. No definitive agreement has been executed in respect of the proposed transaction.

6. Swanston Multiplex Cinemas Private Limited, a Joint Venture of the Company operated a multiplex cinema. The lease of the multiplex cinema has been terminated by the landlord and the company has vacated the premises.

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SECTION VI: LEGAL AND OTHER INFORMATION

OUTSTANDING LITIGATION AND MATERIAL DEVELOPMENTS Except as stated below there are no outstanding litigation, suits, criminal or civil prosecutions, proceedings or tax liabilities against our Company, its Subsidiaries, its Joint Ventures, its Promoters, Directors and the Group Companies and there are no defaults, non-payment of statutory dues, over-dues to banks/financial institutions, defaults against banks/financial institutions, defaults in dues payable to holders of any debenture, bonds and fixed deposits and arrears of preference shares issued by our Company, defaults in creation of full security as per terms of issue/other liabilities, proceedings initiated for economic/civil/any other offences (including past cases where penalties may or may not have been awarded and irrespective of whether they are specified under paragraph (I) of Part 1 of Schedule XIII of the Companies Act) other than unclaimed liabilities of our Company and no disciplinary action has been taken by SEBI or any stock exchanges against our Company, its Subsidiaries, its Joint Ventures, its Promoters, Directors or our Group Companies. For details of the contingent liabilities of our Company, see the section entitled “Financial Statements” at page 188. Cases involving our Company Cases filed against our Company Criminal Cases

The Government of Gujarat through Kishor. K. Dave, managing trustee representing Shree Jagrut Nagrik, consumer protection organization registered under Public Charity Trust Act, 1950 and Society Registration Act, 1860, has filed a criminal complaint before the Additional Sessions Judge at Deesa, Palanpur, against Rajmandir BIG Cinemas Deesa Theatre alleging that, inter alia, food items were being sold in the above-mentioned theatre at a high price and for non-adherence to rules and regulations under the Standard and Weights Measures Act, 1976 and the rules made there under. The matter is currently pending.

Civil Cases

1. IndusInd Media & Communications Limited (“Plaintiff”) has filed a summary suit (no. 1666 of 2006) before the High Court of Judicature at Bombay against Amit Bokadia, K.C. Bokadia and our Company for recovery of money due and payable by Amit Bokadia and K.C. Bokadia to the Plaintiff in relation to two films titled “Ek Haseena Ek Deewana” and “Sazaa”. Our Company was a party to the suit as our Company is in possession of the negatives of the above-mentioned films. Our Company has in the reply, inter alia, stated that since our Company was entrusted with the task of converting the negatives of the film into positives for public exhibition, our Company had the first lien and primary charge over the film negatives until the amount of `123.90 lakhs due and payable is paid to our Company. The matter is currently pending.

2. One Mahendra Dhariwal had obtained advances in the form of loans from Samdarshi Jaiswal (“Plaintiff”)

for making three films i.e. “Maa Tujhe Salaam”, “Nehle Pe Dehla” and “Jail”. Samdarshi Jaiswal has filed a summary suit (no. 285 of 2007) before the Court of Civil Judge (Senior Division), Chandigarh, against amongst others Mahendra Dhariwal and our Company alleging non-payment of an amount due and payable by Mahendra Dhariwal and breach of undertaking by our Company by handing over the prints of the movie “Nehle Pe Dehla” to Mahendra Dhariwal while the loan amount was outstanding. The Plaintiff has also claimed a sum of `300.00 lakhs. The matter is currently pending.

3. Samdarshi Jaiswal (“Applicant”) has filed a civil contempt application (no. 144 of 2008) before the Civil Judge (Junior Division), Chandigarh against our Company alleging violation of interim order dated February 21, 2007 in summary suit (no. 285 of 2007) discussed in 2 above which restrained the release of the prints of the movie. The matter is currently pending.

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4. There are 15 matters pending against our Company, and others, before various courts and fora including Collector of Stamps, in relation to, inter alia, infringement of intellectual property rights, recovery of amounts due and payable, ticket pricing, restraining orders against the release of films. The aggregate amount involved in these cases is `174.18 lakhs. The matters are currently pending.

Arbitration Proceedings 1. Pursuant to a memorandum of understanding dated February 1, 2008 between Nishant Constructions

Private Limited, the developer of Regency Centre at Prahladnagar, Ahmedabad and our Company, the developer has initiated arbitration proceedings against our Company in December 2011. The developer has claimed that it was ready to handover the possession of the multiplex shell and our Company reneged from its obligations under the memorandum of association and terminated the memorandum of association. The aggregate amount involved in this case is `6,044.00 lakhs. The matter is pending.

2. G.S.G. Builders and Infrastructure Limited, the developer of Gold Spot Mall, Hyderabad has initiated arbitration proceedings against our Company in January 2012. The developer has alleged that our Company has on various occasions defaulted in the payment of charges payable under a lease deed dated July 27, 2004 between the developer and our Company and has sought to terminate the lease deed. Our Company has opposed the termination on various grounds and the matter is pending. The aggregate amount involved in the matter cannot be ascertained since no monetary claim has been made by the developer.

Tax Cases 1. A show cause notice dated August 30, 1999 (the “Show Cause Notice”) was issued by the Office of the

Commissioner of Central Excise, Mumbai, alleging that a chemical preparation employed for use in the processing of cinematograph films in our Company’s laboratories amounted to a ‘manufacturing activity’ and hence attracts appropriate tariffs. It was further alleged that the waste generated from the chemical preparations during such processing activity known as ‘Hypo Solution Waste’ fell within the category of “Ash and residues – other than from the manufacture of iron and steel, containing metal or metal compounds” and was chargeable to excise duty. The Commissioner of Central Excise pursuant to his order dated June 26, 2000 confirmed the demands mentioned in the Show Cause Notice and levied penalties on our Company and Vasanji Mamania, our director then. Several other periodical notices were issued by the Commissioner of Central Excise, Mumbai and the demand made pursuant to these show cause notices were confirmed by their respective adjudicating officers. An appeal was preferred to the Customs Excise and Service Tax Appellate Tribunal (“CESTAT”) by our Company challenging the orders of the above-mentioned adjudicating officers. The CESTAT by its order dated July 11, 2008 remanded the matter back to the adjudicating authority for a fresh hearing. The Commissioner of Central Excise preferred an appeal to the High Court of Judicature at Bombay challenging the order dated of July 11, 2008. The High Court, by its order dated June 24, 2009, directed all parties to appear before the Commissioner of Central Excise and with this the appeal was disposed off. The adjudicating officer upon hearing the parties further confirmed the demand made by all the show cause notice by his order dated August 27, 2009. Hence our Company has preferred an appeal to the CESTAT challenging the order dated August 27, 2009. Thereafter, the Joint Commissioner of Central Excise, Mumbai issued another show cause notice which was further confirmed by the Joint Commissioner of Central Excise, Mumbai by his order dated July 15, 2010. A writ petition has been filed before the High Court of Judicature at Bombay against the order dated July 15, 2010. The amount involved in the matter is `2,133.51 lakhs. Multiple proceedings in the matter are currently pending.

2. 1 (one) matter involving our Company is pending before the CESTAT in relation to service tax liabilities on various transactions. The aggregate amount involved in this matter is `137.21 lakhs.

3. 6 (six) matters involving our Company are pending before various state authorities in relation to value added tax liabilities. The aggregate amount involved in these matters is `33.18 lakhs.

4. Our Company has received 13 demand notices from the TDS department with respect to short deduction of

526

TDS, tax deducted but not paid and interest for delayed payment of TDS. The amount involved in these matters is `1,017.10 lakhs. Our company has preferred appeals and applications for rectification of mistakes apparent with respect to some of these notices. No replies have been received in this regard. The IT Department has issued our Company with a “NIL TDS Certificate” for financial years 2011- 2012 and 2012- 2013.

5. There are 2 (two) disputes pending with regard to Rave Entertainment Private Limited, a wholly owned

subsidiary of our Company which merged with our Company with effect from April 1, 2008. The IT Department issued a notice of demand for `1,401.20 lakhs on November 20, 2010 with respect to addition of `3,344 lakhs undisclosed income in the assessment for the assessment year 2008- 2009. An appeal was preferred to the CIT (Appeal). The CIT (Appeal) by order dated November 30, 2011 deleted the addition and allowed the appeal. The IT department preferred an appeal to the Income Tax Tribunal against the order passed by the CIT (Appeal) and the matter is pending. In a separate instance, The IT Department passed an ex parte order treating addition in assessment of assessment year of 2008 – 2009 as assessed income of `3,286 lakhs for assessment year 2009 – 2010 and issued a demand notice of `1,787.20 lakhs on December 12, 2011. Our Company has preferred an appeal to CIT (Appeal), Kanpur and the matter is still pending.

6. In respect of its Multiplexes at Ghaziabad, Chinchwad and Kolkatta, our Company has made applications to the entertainment tax authorities under the Entertainment Tax Act for availing exemption from payment of Entertainment Tax retrospectively from the date of commencement of operations by our Company of the aforesaid multiplexes. The applications are pending and the amount involved in these matters is 300.60 lakhs. The owners of certain multiplexes that we manage in Gurajat, in their capacity as license holders, initiated proceedings before the High Court of Judicature at Gujarat against the Entertainment tax authorities for availing exemption from payment of tax under the applicable law. The High Court decided the matter against the owners who preferred an appeal to the Supreme Court of India. In accordance with directions of the Supreme Court, our Company has deposited the amount payable for the disputed period with the concerned authority since our Company is responsible for collection of entertainment tax. The amount involved in this matter is `509.57 lakhs. The matter is currently pending.

Labour Cases

6 (six) matters involving our Company are pending, among others, before various courts and forums such as Labour Court, City Civil Court, Office of the Collector (Labour) in relation to, inter alia, payment of minimum wages, illegal termination and retrenchment. The aggregate amount involved in these matters is `14.53 lakhs.

Consumer Cases

3 (three) matters involving our Company are pending before Jaipur District Consumer Forum in relation to cancellation of movie shows. The aggregate amount involved in these cases is `0.90 lakhs.

Stamp Duty Cases

A demand notice dated March 9, 2009 was issued by the Collector of Stamps, Mumbai, to our Company demanding payment of stamp duty aggregating to `7.34 lakhs allegedly payable on various agreements executed by our Company, in relation to the distribution and co-production of various films between December 2006 to October 2007. Our Company has replied to the notice on April 10, 2009. The matter is currently pending.

Notices

Four separate show cause notices have been issued by various authorities to our Company alleging exhibition of lesser number of Marathi movies than the number required as per the Maharashtra State Government resolution dated January 4, 2003 read with the provisions of the Bombay Entertainments Duty

527

Act, 1923. Our Company has filed interim replies to each of the notices. The aggregate amount involved in these matters is `28.58 lakhs. The matters are currently pending.

Cases filed by our Company Criminal Complaints

Our Company had engaged the services of a contractor, Laurent & Benton Management Consultants Limited (“Contractor”), for engaging the services of and deploying the personnel of the contractor at its various exhibition properties. Pursuant to an agreement with the Contractor, our Company paid to the Contractor a sum of `294.20 lakhs towards its Provident Fund contribution payable to the personnel deployed at the properties of our Company. Our Company, on learning that the amount as aforesaid which was supposed to be deposited in the individual accounts of the personnel by the Contractor had actually been misappropriated by the Contractor, lodged an FIR with the police authorities in New Delhi and filed a criminal complaint in the Court of Metropolitan Magistrate, Patiala House, New Delhi. The Metropolitan Magistrate has by an order dated June 30, 2012 directed the Station House Officer, Barakhamba and the Deputy Commissioner of Police (EOW) to look into the matter and submit their reports.

Criminal Cases

Our Company has filed 3 (three) separate complaints before various Metropolitan Magistrates and Sessions Courts in relation to misappropriation of funds, cheating and misrepresentation of facts, violation of Private Security Guards (Regulation of Employment and Welfare) Scheme, 2002 and Maharashtra Private Security Guards (Regulation of Employment and Welfare) Act, 1981. The aggregate amount involved in these cases is `325.00 lakhs. The matters are currently pending.

Civil Cases 1. Our Company has filed 4 (four) separate suits before the High Court of Judicature at Bombay for recovery

of dues. The aggregate amount involved in these cases is `603.98 lakhs. The matters are currently pending.

2. Our Company has filed a complaint before the Competition Commission of India, New Delhi, against Karnataka Film Chamber and Commerce (“KFCC”) seeking a direction from the forum restraining KFCC for pressurizing all the local distributors and producers in the State of Karnataka not to supply any language film prints to Big Cinema outlets. An interim order date September 9, 2010, which was further extended by its order dated September 21, 2010, restraining KFCC from directly or indirectly imposing restriction on the distributors or producers to supply the film prints to Big Cinema Theatres. The matter is currently pending.

3. Our Company has filed a suit before the High Court of Judicature at Bombay against Headstart Films Private Limited and four others for recovery of dues amounting to `857.64 lakhs towards assistance given for the film “London Dreams”. A notice of motion seeking interim reliefs was moved by our Company and the same was rejected by the High Court of Judicature at Bombay pursuant to its order dated September 21, 2010. The matter is currently pending.

4. Our Company has filed a writ petition before the High Court of Judicature at Hyderabad against the Lokayukta, the Government of Andhra Pradesh, Commissioner of Police, G. L. Narasimha Rao and others challenging order dated April 1, 2011 passed by the Lokayukta, Government of Andhra Pradesh and seeking directions from the Court quashing the proceeding initiated pursuant to a complaint filed by G. L. Narasimha Rao before the Court of the IX Additional Chief Metropolitan Magistrate, Nampally alleging that online sale of movie tickets through online agencies by various theatres and multiplexes including our Company is unlawful. By an order dated July 20, 2011 the High Court of Judicature at Hyderabad has granted interim directions restraining the respondents from interfering with the sale of tickets through on-line ticket bookings by our Company. The matter is currently pending.

528

Arbitration proceedings 1. Our Company has initiated 3 (three) separate arbitration proceedings in relation to termination of

conducting agreements, entered into between our Company with owners of properties at Indore (Big B and Satyam) and Guna (Jyoti and Sriram Smriti) on grounds such as failure to obtain requisite approvals, structural deficiencies of the theatre, etc. The aggregate amount claimed by our Company is `1,498.10 lakhs.

2. Our Company has initiated an arbitration proceeding against B. R. Films in relation to termination of an agreement dated March 14, 2008 pertaining to a film titled “Banda Yeh Bindaas Hai”. Pursuant to this agreement our Company had paid an amount of `925.00 lakhs for distribution, exploitation, exhibition and marketing of the above-mentioned film. B. R. Films had agreed to hand over the film to our Company on its completion. It is the claim of our Company that the B. R. Films failed to comply with its obligation. The amount involved in the matter is approximately `1,321.50 lakhs. The matter is currently pending.

Section 138 of the Negotiable Instruments Act, 1881

10 (ten) cases have been filed by our Company against its customers under Sections 138 and 142 of Negotiable Instruments Act, 1881 for recovery of dues and dishonour of cheques. The aggregate amount involved in these cases is approximately `511.98 lakhs. These matters are pending.

Winding up cases

Our Company has filed a winding up petition before the High Court of Judicature at Bombay, against WEG Entertainment Private Limited (“WEPL”). Our Company entered into a joint distribution agreement dated September 22, 2007 with WEPL for acquisition and distribution of 95 English films. Our Company paid a sum of `100.00 lakhs as our share of the acquisition costs. A net amount of `253.76 lakhs is due and payable by WEPL.

Notices

Our Company has served a notice dated April 14, 2009 to Jagdish Vasudev Agarwal, proprietor of Rajmandir Cinema, Jalna for termination of the conducting agreement entered into between the parties on July 31, 2007. Pursuant to this agreement it was agreed between the parties that the premises of Rajmandir Cinema would be handed over to our Company on or before September 1, 2007 with all the necessary licenses, permissions, certifications and requirements for the purposes of refurbishing and operating the same. Our Company has stated in its statement that Jagdish Vasudev Agarwal failed to carry out his obligations. The title of the property was disputed by Marathwada Wakf Board. Our Company has claimed an amount of `42.50 lakhs from Jagdish Vasudev Agarwal.

Miscellaneous Matters

Our Company has filed 2 (two) separate complaints before the Joint Assessor & Collector, Mumbai Municipal Corporation and the Brihan Mumbai Municipal Corporation. Our Company has sought adoption of the profit basis method for assessment of its property at IMAX Big Cinemas, Wadala and Big Cinemas R Mulund, respectively, rather than the currently followed gross method. Both the complaints are currently pending.

Small Scale Industries Except as disclosed below, our Company does not owe any small scale industries any amounts exceeding ` 1.00 lakh which is outstanding for more than 30 days except for those small scale sector industry entities where the payment terms are in excess of 30 days. There are no disputes with such entities in relation to payments to be made to them.

529

(in `) Sr. No. Name Amount

outstanding as on June, 30 2012

Amount outstanding more than 30 days as on June, 30 2012

1 Dhananjay Industrial Engineering Private Limited 1,35,430 1,35,430 2 Linear Electronics Private Limited 1,05,941 1,05,941 3 R & S (I) Electronics Private Limited 7,83,879 7,83,879 4 Gemini Picture Palace 12,18,906 12,18,906 5 Insight Business Machines Private Limited 3,40,684 3,11,328 6 Ellora Mega Buildings Projects 44,83,813 29,38,839 7 Bituchem 1,44,423 1,44,423 8 Olive Imaging 1,74,132 1,74,132 9 KMG A to Z Systems Private Limited 14,84,991 14,84,991

Cases involving our Subsidiaries and Joint Ventures Subsidiaries 1. Big Cinemas Entertainment (DE) LLC

Nil 2. Big Cinemas Entertainment LLC

Nil 3. Big Cinemas Exhibitions LLC

Nil 4. Big Cinemas Falls Church LLC

Nil 5. Big Cinemas Galaxy LLC

Nil 6. Big Cinemas IMC LLC

Nil 7. Big Cinemas Laurel LLC

Nil 8. Big Cinemas Lotus Five Star Sdn. Bhd.

Nil

9. Big Cinemas Norwalk LLC

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Nil

10. Big Cinemas Phoenix LLC

Nil 11. Big Cinemas Sahil LLC

Nil 12. Big Cinemas SAR LLC

Nil 13. Big Pictures USA, Inc

Nil 14. Big Synergy Media Limited Cases filed against Big Synergy Media Limited

Nil Cases filed by Big Synergy Media Limited Criminal Cases

Big Synergy Media Limited has filed a criminal complaint with the police station located at Amboli, Maharashtra against Prashant Jhadav alleging criminal breach of trust. Monies were advanced to Prashant Jhadav in various tranches for the production and delivery of a TV series. The program did not materialise and the monies were repayable to Big Synergy Media Limited. Prashant Jhadav was acting as Creative Producer through Shree Om Comtech Private Limited. The company claims that Prashant Jhadav has misappropriated the money advanced to him by Big Synergy Media Limited. This matter has been transferred to the police station located at Veera Desai. The amount involved in the matter is `75.00 lakhs and till date, an amount of `37.75 lakhs has been recovered from him. The matter is currently pending.

Section 138 of the Negotiable Instruments Act, 1881

Big Synergy Media Limited has filed a cheque dishonour case in Andheri Metropolitan Magistrate Court against Mahuaa Media Private Limited (“Mahuaa”). Mahuaa has approached the Sessions Court for squashing of the summons issued by Andheri Metropolitan Magistrate Court. The amount involved in the matter is ` 524.88 lakhs. The matter is currently pending.

Winding up cases 1. Big Synergy Media Limited has filed a winding up petition before the High Court of Judicature at Delhi

against Mahuaa Media Private Limited (“Mahuaa”) for recovery of money in relation to a television show produced by Big Synergy Media Limited for Mahuaa. The amount involved is `524.88 lakhs. The matter is currently pending.

15. Reliance MediaWorks Entertainment Services Limited (Formerly known as Digital Media Imaging

Limited)

531

Cases filed against Reliance MediaWorks Entertainment Services Limited Tax Cases

Reliance MediaWorks Entertainment Services Limited received a demand notice from Navi Mumbai Municipal Corporation for payment of Octroi / Cess Tax as per details provided below.

Financial Year Tax (`̀ in Lakhs) Interest / Penalty (`̀ in Lakhs)

Total (`̀ in Lakhs)

2008-09 12.08 57.64 69.72 2009-10 84.48 383.69 467.16 Reliance MediaWorks Entertainment Services Limited has preferred an appeal claiming that the company is a SEZ unit and, is therefore, exempt from payment of Octroi/entry tax under the Maharashtra IT ITEs Policy 2009. The Directorate of Industries, Government of Maharashtra, issued a letter on January 4, 2012 stating exemption of the company from Octroi/entry tax. The matter is currently pending.

Cases filed by Reliance MediaWorks Entertainment Services Limited Nil

16. Reliance MediaWorks Theatres Limited (Formerly, Adlabs Distributors and Exhibitors Limited) Cases filed against Reliance MediaWorks Theatres Limited Civil Cases

Two separate show cause notices dated August 17, 2010 and September 21, 2010 (the “Show Cause Notice”) were issued by the Collector, Pune and the Assistant Commissioner of Police (Administration), Pune, respectively, to Gold Adlabs, alleging exhibition of lesser number of Marathi movies than the number required as per the Maharashtra State Government resolution dated January 4, 2003 read with the provisions of the Bombay Entertainments Duty Act, 1923. The Collector, Pune has claimed `1.50 lakhs from Reliance MediaWorks Theatres Limited pursuant to the above-mentioned show cause notice dated August 17, 2010. Reliance MediaWorks Theatres Limited has filed its written submissions. The matters are currently pending.

Cases filed by Reliance MediaWorks Theatres Limited Nil 17. Reliance Media Consultant Private Limited

Nil

18. Phoenix Big Cinemas Management LLC

Nil 19. Reliance Lowry Digital Imaging Services Inc.

Nil 20. Reliance Media & Marketing Communications LLC

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Nil 21. Reliance Media Works VFX Inc

Nil 22. Reliance MediaWorks (Malaysia) Sdn. Bhd.

Nil 23. Reliance MediaWorks (Mauritius) Limited

Nil 24. Reliance MediaWorks (UK) Limited Cases filed against Reliance MediaWorks (UK) Limited Winding up Cases

A statutory demand notice dated June 3, 2011 was issued by Vector X Limited to Reliance MediaWorks (UK) Limited alleging non-payment of outstanding amounts in relation to the agreement for sale and purchase of assets dated December 21, 2009. It further mentions that non-payment on the above-mentioned alleged dues may result in Vector X Limited filing a winding up petition against Reliance MediaWorks (UK) Limited. The amount involved in the matter is £0.63 lakhs (as at June 30, 2012 the ` equivalent was `55.14 lakhs). The matter is currently pending.

Cases filed by Reliance MediaWorks (UK) Limited

Nil 25. Reliance MediaWorks (USA) Inc. Cases filed against Reliance MediaWorks (USA) Inc. Civil Cases

NewBurgh / Six Mile Limited Partnership has filed a complaint before the United States District Court, E.D. Michigan, Southern Division, against Reliance MediaWorks (USA) Inc. in relation to a lease agreement entered into between the parties for theater premises located at Laurel Park Place, Livonia, Michigan alleging non-performance of the obligations on the part of Reliance MediaWorks (USA) Inc. A counter claim was filed by Reliance MediaWorks (USA) Inc. in the matter claiming that NewBurgh had failed to deliver the theater premises to them on the due date as required under the lease agreement and also failed to acquire the necessary equipment from the existing tenant. The District Court Judge pursuant to his order dated July 13, 2010 directed Reliance MediaWorks (USA) Inc. to pay an amount of US $48.70 (as at June 30, 2012 the ` equivalent was `2,738.40) lakhs towards losses suffered by NewBurgh for the entire term of the lease. An appeal was preferred by Reliance MediaWorks (USA) Inc. before the Sixth Circuit Court of Appeal against the order date July 13, 2010. United States District Court, E.D. Michigan, Southern Division has granted a stay to Reliance MediaWorks (USA) Inc against the execution of the order dated July 13, 2010 pending a final ruling. The Sixth Circuit affirmed the decision of the District Court by its order dated May 22, 2012. Reliance MediaWorks (USA) Inc. has not preferred an appeal yet. Reliance MediaWorks (USA) Inc has also obtained a stay of execution of any amount of the judgment pending a final ruling from any appellate court.

Cases filed by Reliance MediaWorks (USA) Inc.

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Civil Cases

Reliance MediaWorks (USA) Inc. filed a legal malpractice complaint against its former counsel Giarmarco, Mullins & Horton, P.C in the above mentioned civil case (NewBurgh / Six Mile Limited Partnership v. Adlabs Films USA, Inc.). The matter is currently pending in United States District Court, Eastern District of Michigan.

26. Reliance MediaWorks (Netherlands) B.V. Cases filed against Reliance MediaWorks (Netherlands) B.V. Civil Cases

Bharath Entertainment International B.V. (“BEI”) has filed a suit before the Rotterdam District Court against Reliance MediaWorks (Netherlands) B.V. alleging breach of a distribution agreement entered into with Reliance MediaWorks (Netherlands) B.V. pursuant to which Reliance MediaWorks (Netherlands) B.V. had agreed to distribute all its films in Netherlands through BEI. Reliance MediaWorks (Netherlands) B.V. has denied the existence of such an agreement. The Court by its order dated June 27, 2012 has directed Reliance MediaWorks (Netherlands) B.V. to pay a sum of approximately Euro 0.54 lakhs (as at June 30, 2012 the ` equivalent was `38.07 lakhs). An appeal has not yet been preferred.

Cases filed by Reliance MediaWorks (Netherlands) B.V.

Nil Joint Ventures 1. Divya Shakti Marketing Private Limited

Nil

2. Swanston Multiplex Cinemas Private Limited Cases filed against Swanston Multiplex Cinemas Private Limited Criminal Cases 1. The Brihan Mumbai Municipal Corporation (“BMC”) has filed 2 (two) cases before the Metropolitan

Magistrate, Ville Parle, Mumbai against Shravan Shroff, director of Swanston Multiplex Cinemas Private Limited alleging unauthorized construction of an overhead tank and cooling towers for Fame Big Cinemas theatre. The BMC has sought to impose a penalty of `0.20 lakhs. The matters are currently pending.

2. BMC has filed a complaint before the Court of Metropolitan Magistrate, Mumbai against Mr. Shravan Shroff and Swanston Multiplex Cinemas Private Limited for keeping celluloid base film at the theatre in violation of the general conditions of the license issued by the Municipal Corporation of Greater Mumbai. The matter is currently pending.

3. The Security Guard Board for Brihan Mumbai and Thane District has initiated criminal proceedings being Criminal complaint number 2485/SS/2005 before the Additional Chief Judicial Magistrate, 38th Court, Mumbai against Swanston Multiplex Cinemas Private Limited, Shravan Shroff, Mr. Satendra Singh and Shushma Kadam, alleging the company had violated the provisions and requirements of the CLRA. Process has been issued by order dated September 20, 2005 (“Order 1”) against all accused in the criminal complaint above. One of the accused Shravan Shroff (“Applicant”) director of Swanston Multiplex

534

Cinemas Private Limited has filed a revision petition along with an application for condonation of delay bearing number 1820 of 2008 before the Court of Sessions, Mumbai against “Order 1”. The Additional Sessions Judge vide order dated April 19, 2011 dismissed the Revision Application. The matter is currently pending.

Labour Cases The workers of Fame (India) Limited and Swanston Multiplex Cinemas Private Limited (through their union) (“Complainants”) have filed a case before the Industrial Court, Bandra, Mumbai against Fame (India) Limited and Swanston Multiplex Cinemas Private Limited (“Defendants”) alleging unfair labour practices. The Defendants have filed their reply to the complaint. The matter is currently pending.

Cases filed by Swanston Multiplex Cinemas Private Limited Civil Cases

Swanston Multiplex Cinemas Private Limited filed a writ petition before the High Court of Judicature at Bombay against the State of Maharashtra and other parties in relation to notices issued by the Tahilsdar on December 5, 2005, December 30, 2005 and January 21, 2006 for alleged non-payment of entertainment dues amounting to `198.10 lakhs. The High Court of Judicature at Bombay granted relief exonerating Swanston Multiplex Cinemas Private Limited from payment of the dues. However, this judgment was reversed by the Supreme Court of India upon an appeal by the State of Maharashtra. Further the State of Maharashtra was directed to realize the amount claimed and donate the same to a charitable organization. Swanston Multiplex Cinemas Private Limited has deposited an amount of `187.00 lakhs with the Tehsildar, representing the State of Maharashtra. A review petition has now been filed by Swanston Multiplex Cinemas Private Limited in the Supreme Court for a review of the judgment of the Supreme Court of India. The matter is currently pending. Swanston Multiplex Cinemas Private Limited has also filed a notice of motion before the High Court of Judicature at Bombay for recovery of `20.00 lakhs from the Government of Maharashtra which was deposited upon the directions of the High Court at the time of filing the writ petition. The notice of motion is currently pending.

Tax Cases 1. A notice has been received for the assessment year 2005 – 2006 reopening the assessment and giving show

cause for disallowance under the Income Tax Act for alleged non deduction of TDS on film rental amounting to `30.95 lakhs paid to non-resident film distributor. Swanston Multiplex Cinemas Private Limited submitted its response to the notice.

2. Swanston Multiplex Cinemas Private Limited has preferred an appeal to the Commissioner of Income Tax (Appeals)-3, Mumbai against the assessment order passed by the Assistant Commissioner of Income Tax- 11(1), Mumbai, dated December 23, 2010. Swanston Multiplex Cinemas Private Limited had filed a revised return of income for the assessment year 2008 – 2009 declaring an income of `92.37 lakhs. The Assessing Officer vide rectification order dated December 23, 2010 computed the taxable income as a total income of `141.24 lakhs and total book profit of `87.40 lakhs, initiating further penalty proceedings. The matter is currently pending.

3. Swanston Multiplex Cinemas Private Limited was issued a show cause notice raising demand of `17.45 lakhs and interest and penalty of `40.13 lakhs by the Assistant Commissioner of Sales Tax, Mumbai. Swanston Multiplex Cinemas Private Limited replied to the said notice partially accepting claims raised by Assistant Commissioner of Sales Tax, Mumbai.

535

Cases involving our Directors 1. Gautam Doshi Cases filed against Gautam Doshi Criminal Cases

1. The Central Bureau of Investigation (CBI) has registered a first information report dated October 21, 2009

(FIR) pertaining to allegations of criminal conspiracy and criminal misconduct, in respect of telecommunications licences and spectrum allotted by the Government of India inter alia to SwanTelecom Limited in 2008. Pursuant to the FIR, the CBI filed a charge sheet dated April 2, 2011 in the Court of Special Judge (CBI), New Delhi, against various persons, including one of our non-executive Directors, Gautam Doshi. The Special Judge (CBI) has framed charges against all the persons specified in the charge sheet. Proceedings, in the matter, including a writ petition that Gautam Doshi has preferred to the High Court of Judicature at Delhi are ongoing.

2. Snehal Shah filed a criminal complaint, Criminal Case No. 294/SW/11, against, amongst others, Reliance Life Insurance Company Limited, Gautam Doshi, a director of our Company and an ex director of Reliance Life Insurance Company Limited, alleging criminal breach of trust and cheating in respect of an investment of `250.00 lakhs in the Reliance Money Guarantee Plan. The Ld. Metropolitan Magistrate 22nd Court, Andheri, Mumbai passed an order on October 4, 2011, issuing process and around November, 2011, summons was served on the respondents. On December 12, 2011, Gautam Doshi and others filed a writ petition, WP No. 3815 of 2011, before the High Court of Judicature at Bombay seeking to quash the said order and the summons. The High Court of Judicature at Bombay issued an ad-interim stay on the order of the Magistrate. Subsequently, Ankit Shah, son of Snehal Shah, lodged another complaint with the Senior Inspector of Police, Santa Cruz in respect of the same investment and summons were issued in the name of the above parties, for the purpose of investigation. The aforesaid fact was brought to the notice of the High Court and necessary amendments were carried out in the above petition. The High Court of Judicature at Bombay extended the ad-interim stay on the complaint filed by Ankit Shah. The matters are currently pending.

Cases filed by Gautam Doshi

Nil 2. Amit Khanna

Nil 3. Sujal Shah

Nil 4. Anil Sekhri

Cases filed against Anil Sekhri Criminal Cases

J. B. Singh filed criminal complaint C. C. no. 289/S of 1996 and C. C. no. 823/ Misc / 1996 in the Court of Metropolitan Magistrate, 10th Court at Andheri Bombay against Anil Sekhri, one of our directors alleging that certain sums were advanced to Anil Sekhri in respect of filing income tax returns as Chartered Accountant of the complainant and the same was misappropriated. The matter is currently pending. The

536

Disciplinary Committee of the Council of the Institute of Chartered Accountants of India submitted its report on the matter (25-CA (28)/2000) opining that Anil Sekhri is not guilty of any of the charges levied against him.

Cases filed by Anil Sekhri Section 138 of the Negotiable Instruments Act, 1881

Anil Sekhri, one of our directors had filed summary suit no. 3772 of 1998) for recovery of `12.00 lakhs from one J. B. Singh before the High Court of Judicature at Bombay. The recovery suit was in relation to a cheque issued by J. B. Singh which was dishonoured. The High Court of Judicature at Bombay on December 2, 2002 issued a decree against J. B. Singh in the sum of `24.54 lakhs. J. B. Singh has preferred an appeal no. 382 of 2003 to the High Court of Judicature at Bombay on June 15, 2008 and the matter is pending.

5. Prasoon Joshi

Nil Cases involving our Promoters 1. Reliance Land Private Limited

Nil

2. Reliance Capital Limited (as at June 30, 2012) Cases filed against Reliance Capital Limited Criminal Cases

There are 31 criminal cases filed against Reliance Capital Limited by its customers in various Courts in respect of recovery of loan amounts. These cases are pending at various stages of adjudication. These matters are currently pending.

Civil Cases 1. Bharatiben and others (as legal heirs and representatives of late Manubhai Maneklal) (“Plaintiffs”) have

filed a suit before the High Court of Judicature at Bombay against Reliance Capital Limited for recovery of equity shares delivered by Manubhai Maneklal and others to Reliance Capital Limited as a custodian in relation to transactions undertaken by Reliance Enterprises Limited. The aggregate amount involved in this matter is `757.00 lakhs. The matter is currently pending.

2. Harinarayan Bajaj and others (“Plaintiffs”) have filed a suit before the High Court of Judicature at Bombayagainst Reliance Capital Limited alleging improper enforcement of security by Reliance Capital Limited in relation to loans amounting to `1,000.00 lakhs granted by Reliance Capital Limited to the Plaintiffs. The Plaintiffs are claiming refund of the shares pledged as security along with accrued benefits thereon or a payment of an amount of `164.50 lakhs with interest at 24%. The matter is currently pending.

Investor Related Disputes 1. There are 53 investor related disputes in respect of shares and 11cases are in relation to monetary claims

involving an aggregate amount of `9.42 lakhs. Further, there are 115 investor related disputes in which Reliance Capital Limited has been made a party, but there would be no financial impact on Reliance Capital Limited. Out of these, 32 cases are in relation to settlement involving brokers or third parties, 53 cases which involve the complainant making payment to Reliance Capital Limited or providing suitable

537

indemnities, 29 cases where settlement is pending for completion of procedural formalities and 26 cases where copies of relevant court documents / complaints are not available.

2. There are 39 investor related disputes filed after the demerger of Reliance Capital Ventures Limited from Reliance Industries Limited and its subsequent merger with Reliance Capital Limited, where parties claim to have lost shares pursuant to the said demerger and merger. These cases relate to 1,534 shares in total. Reliance Capital Limited has not been made a party in all these cases. These cases relate to ownership of shares and shares to be allotted subsequent to the said demerger and merger.

Consumer Cases

There are 266 consumer cases filed against Reliance Capital Limited in various courts in respect of disbursement of loan amounts. The aggregate amount involved in these matters is `1,120.54 lakhs and are pending.

Cases filed by Reliance Capital Limited Criminal Cases

There are 21,551 cases filed by Reliance Capital Limited in various Metropolitan Magistrate courts for recovery of dues and dishonour of cheques given towards repayment of loan. The cases involve an aggregate amount of `2,850.43 lakhs and are pending.

Arbitration Proceedings

There are 3,895 cases filed by Reliance Capital Limited before the sole arbitrator for recovery of dues in respect of loan facilities granted by it to its various customers. The cases involve an aggregate amount of ` 4,023.86 lakhs and are pending.

Cases involving our Group Companies Except for the litigation in which our Company is also a party, none of the litigation against the Group Companies is likely to have any adverse effect on the financial performance of our Company. Cases filed against our Group Companies 1. Reliance Broadcast Network Limited Cases filed against Reliance Broadcast Network Limited

Civil Cases

1. Aanand Audio Video has filed a writ petition before the High Court of Judicature at Bangalore against an

order dated August 25, 2010 passed by the Indian Copyright Board in a proceeding involving Phonographic Performance Limited (“PPL”), a registered copyright licensing authority. Various FM radio broadcasting companies, including Reliance Broadcast Network Limited have been made a party to the suit. The order dated August 25, 2010 places a cap of 2% of net advertisement earnings made by each FM radio station on the license fees payable to PPL and other music providers to be distributed pro rata as compensation to all music providers in proportion to the music provided by the respective music providers and broadcast by the FM radio station. In view of the said order, Aanand Audio Video received letters from various FM radio broadcasters stating the license fee payable by them to Aanand Audio Video would be in accordance with the said order. Hence, Aanand Audio Video filed the above-mentioned writ petition. The matter is currently pending.

538

2. Subhiksha Trading Services Limited (“Plaintiff”) has filed a suit before the Additional City Civil Court, Chennai against Hash 10 Telecom Private Limited, Reliance Broadcast Network Limited and others for restraining the airing of certain advertisement alleged to be defamatory. Reliance Broadcast Network Limited has filed its written statement. The matter is currently pending.

3. Leading Edge has taken out 5 (five) Chamber Summons for changing the name from Reliance Media

World Limited to Reliance Broadcast Network Limited in connection with recovery of an amount of approximately `64.00 lakhs. The application has been allowed. Summons is yet to be served to Reliance Broadcast Network Limited.

4. Narendra Kumar Gupta, proprietor of Jai Durga Tent & Light Decorators has filed a suit before the District

Court, New Delhi, against Reliance Broadcast Network Limited for non – payment of dues for services rendered by him aggregating to `6.85 lakhs. The matter is currently pending.

5. Rajender Mathur and two others have filed a suit before the District Court, Hisar, against Reliance

Broadcast Network Limited for recovery of damages caused to premises licensed to Reliance Broadcast Network Limited aggregating to `6.82 lakhs. The matter is currently pending.

6. De Kulture Music Pvt. Ltd. has filed a suit before the District Sessions Judge, Jaipur, against Reliance

Broadcast Network Limited for obtaining injunction against broadcasting of certain sound recordings. The matter is currently pending.

7. Colour Purple has filed a petition before the High Court of Judicature at Calcutta against Reliance

Broadcast Network Limited for injunction against the airing of certain radio spots aired by Reliance Broadcast Network Limited, alleging them to be defamatory in nature and also claiming an amount of `500.00 lakhs towards damages. The matter is currently pending.

8. Sunrise Advertising Pvt. Ltd. has filed a petition before the District Court, New Delhi against Reliance

Broadcast Network Limited for injunction against the airing of certain radio spots aired by Reliance Broadcast Network Limited, alleging them to be defamatory in nature and also claiming the amount payable for the suit instituted. The matter is currently pending.

9. Access Atlantech Edutainment (I) Ltd. has filed a petition before the High Court at Chennai against

Reliance Broadcast Network Limited for injunction against the airing of certain radio spots aired by Reliance Broadcast Network Limited, alleging them to be defamatory in nature and also claiming an amount of `30.00 lakhs towards damages. The matter is currently pending.

10. Regency Ceramics Limited has filed a petition before the City Civil Court, Hyderabad, against Reliance

Broadcast Network Limited for injunction against the airing of certain radio spots aired by Reliance Broadcast Network Limited, alleging them to be defamatory in nature and also claiming an amount of `125 lakhs towards damages. The matter is currently pending.

11. Galaxy Amaze Kingdom Limited has filed a petition before the High Court of Judicature at Chennai,

against Reliance Broadcast Network Limited for injunction against the airing of certain radio spots aired by Reliance Broadcast Network Limited, alleging them to be defamatory in nature and also claiming an amount of `26.00 lakhs towards damages. The matter is currently pending.

Tax Cases

A notice was issued by the Excise & Taxation Officer, Punjab (“ETO”) against Reliance Broadcast Network Limited for improper documentation of goods under transport. Thereafter, an order dated July 28, 2007 was passed by the ETO against Reliance Broadcast Network Limited for detention of the goods. Reliance Broadcast Network Limited obtained release of the goods and preferred an appeal to the Deputy Excise and Taxation Commissioner cum Joint Director of Enforcement, Patiala (“Excise Commissioner”). The Excise Commissioner disposed the appeal and remanded the matter back to the ETO. The ETO passed

539

a similar order dated March 7, 2009 against which Reliance Broadcast Network Limited has filed a fresh appeal to the Deputy Excise and Taxation Commissioner-Cum-Joint Director Enforcement, Patiala Division, Patiala. The aggregate amount involved in this matter is `2.57 lakhs. The matter is currently pending.

Labour Cases

1. Priti Suiru (“Claimant”) has filed a claim before the Industrial Tribunal, Panaji against Reliance Broadcast Network Limited alleging wrongful termination of employment and claiming reinstatement and payment of outstanding wages. The amount involved in the matter is `3.00 lakhs. The order has been passed in favour of the Claimant. Reliance Broadcast Network Limited has filed a writ petition before the Bombay High Court at Goa against the said order.

2. Mahamaya Jena (“Claimant”) has filed a complaint before the Labour Court, Bhubaneswar against

Reliance Broadcast Network Limited claiming an amount of `2.28 lakhs towards performance incentive. The matter is currently pending.

3. Munish Ohja (“Claimant”) has filed a claim before the Labour Court, Chandigarh against Reliance

Broadcast Network Limited claiming amounts aggregating to `0.30 lakhs towards leave encashment. The matter is currently pending.

4. Meenakshi Bhojwani (“Claimant”) has filed an application before the High Court of Judicature at Delhi against Reliance Broadcast Network Limited challenging the arbitral award dated December 30, 2009 passed by B. L. Garg, sole arbitrator in favour of Reliance Broadcast Network Limited. The arbitral award dated December 30, 2009 was in relation to an employment contract and employment bond, entered into between Reliance Broadcast Network Limited and Meenakshi Bhojwani, former employee. The amount involved in the matter is `21.87 lakhs. The matter is currently pending.

5. Quadir Ashraf (“Claimant”) has filed a claim before the Labour Court, Jammu, against Reliance Broadcast

Network Limited claiming amounts aggregating to `3.84 lakhs towards leave encashment and performance bonus. The matter is currently pending.

Stamp Duty Cases

A notice dated April 30, 2007 was issued by the Court of Additional Commissioner (Stamps), Aligarh (“Stamps Commissioner”) against Reliance Broadcast Network Limited alleging evasion of stamp duty payable on lease renewals. The aggregate amount involved in this matter is `8.19 lakhs. The Stamps Commissioner passed an order dated October 22, 2009 against Reliance Broadcast Network Limited. Thereafter, Reliance Broadcast Network Limited has filed a writ petition before the High Court of Judicature at Allahabad for quashing of the said order. The High Court of Judicature quashed the orders of the lower court and the matter has been remanded to the Assistant Commissioner (Stamp) for determination of stamp duty payable. The matter is pending.

Notices 2 (two) separate show cause cum demand notices were issued by the Commissioner Service Tax, Mumbai against Reliance Broadcast Network Limited for an amount of `74.44 lakhs and 5 (five) show cause cum demand notices were issued by the Assistant Commissioner Service Tax, Mumbai for an amount of `815.53 lakhs. Reliance Broadcast Network Limited has filed its replies against these show cause cum demand notices and the amount of the contingent liability is approximately `1414.00 lakhs.

Cases filed by Reliance Broadcast Network Limited

Civil Cases

540

1. Reliance Broadcast Network Limited has filed a complaint before the Monopolies & Restrictive Trade Practices Commission, New Delhi (“MRTP Commission”) against Rajasthan Patrika Private Limited for its refusal to publish Reliance Broadcast Network Limited’s advertisements in its newspaper. The matter is currently pending.

2. Reliance Broadcast Network Limited has filed a suit before the High Court of Judicature at Bombay against

the Maharashtra State Road Development Corporation Limited for recovery of amounts paid by Reliance Broadcast Network Limited under an agreement dated May 17, 2009 as security deposit and advance license fees along with interest. The amount involved in this matter is `540.00 lakhs. The matter is currently pending.

Arbitration Proceedings

1. Reliance Broadcast Network Limited has initiated an arbitration proceeding before a sole arbitrator against

Access Atlantech Entertainment Limited in relation to payment for certain services rendered by Reliance Broadcast Network Limited. An interim order dated March 1, 2011 has been passed in favour of Reliance Broadcast Network Limited in relation to the admissibility of the arbitration proceeding. The aggregate amount involved in this matter is `34.30 lakhs. The matter is currently pending.

2. Reliance Broadcast Network Limited has initiated an arbitration proceeding in relation to breach of

employment contract and employment bond entered into between Reliance Broadcast Network Limited and Meenakshi Bhojwani, former employee. Reliance Broadcast Network Limited obtained award dated December 30, 2009 in its favour and the same has been challenged before the High Court of Judicature at Delhi by Meenakshi Bhojwani. An execution petition has also been filed before the District Judge, Chandigarh by Reliance Broadcast Network Limited for executing the arbitral award dated December 30, 2009. The aggregate amount involved in the matter is `21.87 lakhs. The matter is currently pending.

3. Reliance Broadcast Network Limited had initiated an arbitration petition in Hyderabad in connection with

the dispute with M/s Stanpower in which Reliance Broadcast Network Limited is claiming an amount of `415.17 lakhs on account of breach by Stanpower of the terms and conditions of an agreement executed with Reliance Broadcast Network Limited. The matter is currently pending.

4. Reliance Broadcast Network Limited has a pending dispute with Broadcast Engineering consultant India

Ltd. (“BECIL”) for an amount of ` 3,896.87 lakhs. 2 (two) separate applications have been filed by Reliance Broadcast Network Limited before the High Court of Judicature at Delhi, under Sections 9 and 11 of the Arbitration & Conciliation Act, 1996, for the appointment of an arbitrator to resolve the dispute with BECIL. The matter is currently pending. Reliance Broadcast Network Limited has filed two applications under section 11 of the Arbitration and Conciliation Act, 1996 before the High Court of Judicature at Bombay for the appointment of an arbitrator to resolve the dispute with Mahuaa Media Private Limited, and the dispute with Moon Up Info Tech Private Limited and Mangla Add Creation. The total amount involved in these matter is `98.52 lakhs. The matter is currently pending.

Section 138 of the Negotiable Instruments Act, 1881 47 cases have been filed by Reliance Broadcast Network Limited under sections 138 and 142 of the Negotiable Instruments Act, 1881 for recovery of dues and dishonour of cheques. The aggregate amount involved in these cases is approximately `250.00 lakhs. These matters are pending.

Intellectual Property Proceedings

1. Reliance Broadcast Network Limited has filed 16 compulsory licensing application in accordance with Section 31 (1) (b) of the Copyright Act, 1957, before the Indian Copyright Board against various music labels to allow Reliance Broadcast Network Limited to broadcast the work from repertoire of the respective

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music labels on payment of certain percentage of the net advertising earnings of each of its radio station. The matter is currently pending.

2. Reliance Broadcast Network Limited has filed a complaint under Section 19A(2) read with Section 30A of

the Indian Copyright Act, 1957, before the Indian Copyright Board against Indian Performing Rights Society and Super Cassettes Industries Limited to refund the royalty paid by Reliance Broadcast Network Limited as performance royalty. The matter is currently pending.

3. Reliance Broadcast Network Limited has filed a suit before the High Court of Judicature at Bombayfor

declaration, permanent and mandatory injunction & recovery against Indian Performing Rights Society. The matter is currently pending.

4. Reliance Broadcast Network Limited has filed a suit before the High Court of Judicature at Delhi for

declaration, permanent and mandatory injunction & recovery against Super Cassettes Industries Limited. The matter is currently pending.

Winding up cases

1. Reliance Broadcast Network Limited has filed a winding up petition before the High Court of Judicature at Chennai against Subhiksha Trading Services Limited for non-payment of liabilities amounting to approximately `43.49 lakhs. The winding up has been ordered by the court.

2. Reliance Broadcast Network Limited has filed a winding up petition before the High Court of Judicature at

Bombay against Raj Oil Mills Limited for non-payment of liabilities amounting to approximately `178.12 lakhs. The matter is pending.

2. Reliance Capital Asset Management Limited Cases filed against Reliance Capital Asset Management Limited Civil Cases 1. Vinny Trehan (through Radha Rani) (“Plaintiff”) has filed a suit before the Civil Judge, Junior Division,

Amritsar against Reliance Capital Asset Management Limited for making a transmission of mutual fund units on the basis of a nomination made by deceased investor of Reliance Mutual Fund (“RMF”), which is alleged to be against the terms of the will produced by the Plaintiff. The aggregate amount involved in this matter is `3.67 lakhs. The matter is currently pending.

2. PAN Securities Limited (“Plaintiff”) has filed a suit before the Junior Civil Judge, City Civil Court,

Hyderabad against Gopal M. Mahubani, Reliance Capital Asset Management Limited and others. The matter involves a dispute relating to the redemption of units provided by Reliance Capital Asset Management Limited. The aggregate amount involved in this matter is `2.43 lakhs. The matter is currently pending.

3. Siddharth Deepak Chury has filed a suit before the High Court of Judicature at Bombay against Prabhakar

Deepak Chury and Reliance Capital Asset Management Limited for obtaining possession of a flat owned by Siddharth Deepak Chury which was being occupied by Reliance Capital Asset Management Limited on leave and license basis. Reliance Capital Asset Management Limited has retained possession of the flat since the security deposit paid by Reliance Capital Asset Management Limited was not refunded upon expiry of the license. The aggregate amount involved in this matter is `10.00 lakhs. The matter is currently pending.

4. Pramila Lodha (“Plaintiff”) has filed a suit before the High Court of Judicature at Bombay against

Edelweiss Securities Limited and Reliance Capital Asset Management Limited. The Plaintiff had provided a power of attorney in favour of Edelweiss Securities Limited and directed Reliance Capital Asset

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Management Limited to mark a lien on her folio in favour of Edelweiss Securities Limited. In the present dispute, the Plaintiff has moved to the High Court for issuing directions to Reliance Capital Asset Management Limited not to act on instructions of the Edelweiss Securities Limited. The aggregate amount involved in this matter is `12.73 lakhs. The matter is currently pending.

5. Kanti Gupta and Tanushree Varshney (through Kanti Gupta) (“Plaintiffs”) have filed a suit before the Civil

Judge (Senior Division), Kanpur Nagar against Shweta Varshney, Reliance Capital Asset Management Limited and 22 others (“Defendants”) seeking a permanent injunction against Shweta Varshney from making payments to Defendant Nos. 2 to 23 in relation to investments held in the name of Vivek Varshney, deceased son of Kanti Gupta, and for a decree of declaration of the Plaintiffs’ share in Vivek Varshney’s property. The matter is currently pending.

6. Dr. Murad A. Rahman (“Plaintiff”) has filed a suit before the High Court of Judicature at Delhi against

Ayesha Swathy Rehman, Reliance Capital Asset Management Limited and others for declaration, partition and a permanent and mandatory injunction. The High Court of Judicature at Delhi has directed Reliance Capital Asset Management Limited to freeze the mutual fund investments of the Plaintiff’s father, late M.A. Rahman, until the matter is disposed off. The amount involved in the matter is `8.63 lakhs. The matter is currently pending.

7. Ravi Ghai (“Plaintiff”) has filed a suit before the High Court of Judicature at Delhi against Mala Mehra

and others in relation to the estate of late Krishna Ghai, an investor in Reliance Mutual Fund. The amount involved is `100.00 lakhs. The matter is currently pending.

8. Bharti Wadone has filed a suit before the Civil Judge (Senior Division), Gadag in relation to transmission of mutual fund units on the basis of the nomination made by Ravindra A. Wadone, the deceased investor. The units of mutual fund held in the folio of Ravindra A. Wadone have been freezed pending the disposal of the suit by the competent court. The amount involved in the matter is `0.61 lakhs. The matter is currently pending.

9. V. Sundar has filed a petition before the District Judge, Coimbatore in relation to the transmission of

mutual fund units on the basis of the nomination made by D K P Varadarajan, the deceased investor. The units of mutual fund held in the folio of D K P Varadarajan have been freezed pending the disposal of the suit by the competent court. The amount involved in the matter is `1.35 lakhs. The matter is currently pending.

10. Siddharth Shukla (“Plaintiffs”) has filed a suit before the Additional District Judge, Jabalpur M.P., in relation to recovery of `1.35 lakhs towards non receipt of units in Reliance Diversified Power Sector Fund.

11. Indian Dairy (“Plaintiffs”) has filed a suit before Senior Civil Judge, Rohini, Delhi in relation to recovery of `1.50 lakhs towards non allotment of units in Reliance Liquid Plus Fund.

12. Vachaspati Dixit ("Plaintiff") has filed a suit before the Civil Judge (Sr. Div.) Kotdwara against Neeru Dixit and Others in relation to the estate of Neeru Dixit, an investor in Reliance Mutual Fund. The amount involved is `0.55 lakhs. The matter is currently pending.

13. Shobha Shukla (“Plaintiffs”) has filed a suit before the Addl. Magistrate Of First Class, Bhopal against RMF and others for succession to the properties of Late Sh. Rajneesh Shukla who was an investor of Reliance Mutual Fund. The amount involved is `0.16 lakhs. The matter is currently pending.

14. Minor Gitanshu Agarwal & Minor Taejaal Agarwal (represented by their natural father, Sanjoy Kumar Agarwal) (“Plaintiffs”) have filed a suit before the Civil Judge (Jr. Div.) Howrah against RMF & others for declaration to the effect that the redemption amount which was paid by Defendant No. 1 (RMF) to Defendant No. 2, being the grandfather of Minor Gitanshu Agarwal & Minor Taejaal Agarwal belongs to the Plaintiff.

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15. Piyush Chandra (“Plaintiff”) has filed a suit at High Court of Judicature at Delhi, against Reliance Mutual Fund and others for obtaining a decree for permanent injunction.

16. Manoj Kumar Sharma (“Plaintiff”) has filed a case in the Court of Magistrate of First Class, Family Court, Bareily against Neetu Singh & Ors. and including Reliance Capital Asset Management Limited as a party for transfer of units invested in the name of Neetu Singh to his name.

17. Mamta Tiwari (“Plaintiffs”) has filed a suit before the Hon’ble Court of Judicial Magistrate of First Class against Reliance Mutual Fund and others for succession to the properties of Madhu Sudan Tiwari who was an investor of Reliance Mutual Fund. The amount involved is `0.11 lakhs. The matter is currently pending.

18. MGD Electronics & Mr. Rajesh Rathi (“Plaintiffs”) have filed a suit before the Hon’ble Civil Judge, Gandhinagar against YES Bank Ltd, Ms. Shruti Panchal, RMF and others for recovery of a total amount of `33.67 lakhs in respect of losses incurred as a result of an alleged fraud conducted on the Plaintiffs. The amount involved is `2.13 lakhs and interest thereon. The matter is currently pending.

19. Smt Rajam Srinivasan filed a suit against Reliance Capital Asset Management Limited alleging wrongful allotment of units of mutual funds to Sujatha against cheque submitted by her for an amount of `3.00 lakhs. An order was passed by the High Court of Judicature at Chennai directing Reliance Capital Asset Management Limited to deposit a sum of `5.16 lakhs with the Registrar of the Court. Reliance Capital Asset Management Limited preferred an appeal. The matter is currently pending.

Consumer Cases

There are 27 consumer related complaints filed against Reliance Capital Asset Management Limited before various District and State Consumer Disputes Redressal Forums. In certain cases the branch managers, regional managers and chief executive officer/ managing director of Reliance Capital Asset Management Limited have also been added as parties. These matters involve allegations relating to inter alia deficiency in service, fraud committed by third parties, rejection of application for allotment of units, refusal for redemption of units and non-receipt of dividend. The approximate amount involved in these matters is `227.00 lakhs. The matters are currently pending.

Cases filed by Reliance Capital Asset Management Limited Civil Cases

Reliance Capital Asset Management Limited has filed an application before the High Court of Judicature at Bombay for permission to act as an agent of the receiver appointed by the High Court in the suit (no. 1937 and 1938 of 2000) filed by Siddharth Deepak Chury against Prabhakar Deepak Chury and others for a flat owned by Siddharth Deepak Chury which was being occupied by Reliance Capital Asset Management Limited on leave and license basis. Reliance Capital Asset Management Limited has retained possession of the flat since the security deposit paid by Reliance Capital Asset Management Limited was not refunded upon expiry of the license. The aggregate amount involved in this matter is `10.00 lakhs. The matter is currently pending.

Consumer Cases 1. Reliance Capital Asset Management Limited has preferred an appeal to the State Consumer Disputes

Redressal Commission, Hyderabad against an order of the District Consumer Disputes Redressal Forum Kurnool pursuant to which Reliance Capital Asset Management Limited has been directed to pay interest at 12% p.a. on the investment of `20,000 along with `1,000 towards litigation cost. The aggregate amount involved in this matter is approximately `0.25 lakhs. The matter is currently pending.

2. Reliance Capital Asset Management Limited has preferred an appeal to the State Consumer Disputes Redressal Commission, Maharashtra (Aurangabad Bench) against an order of the District Consumer

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Disputes Redressal Forum. The aggregate amount involved in this matter is approximately `0.10 lakhs. The matter is currently pending.

3. Reliance General Insurance Company Limited

Cases filed against Reliance General Insurance Company Limited Insurance Claims

There are 24,080 claims pending before the Motor Accidents’ Claims Tribunal (“MACT”) against Reliance General Insurance Company Limited involving an aggregate amount of `20,993.87 lakhs. The matters are currently pending before various tribunals.

Cases filed by Reliance General Insurance Company Limited Civil Cases 1. A civil suit has been filed against ICICI Bank in the High Court of Judicature at Bombay under Original

Ordinary Civil Jurisdiction claiming wrongful debit of a sum of `24.54 lakhs and seeking recovery of the same.

2. Reliance General Insurance has filed recovery suit against Garg HUF at Muzaffarnagar for non-refund of security amount post termination of lease agreement deposited with Garg HUG at the time of lease. The amount involved in the matter is `18.00 lakhs.

Arbitration Proceedings

Reliance General Insurance Company Limited has filed two arbitration applications before the High Court of Judicature at Delhi against Mac Overseas and Allied Enterprises (“Defendants”) for refund of the security deposit paid to the Defendants by Reliance General Insurance Company Limited in relation to the premises, furniture and fixtures taken by Reliance General Insurance Company Limited on leave and license basis. The aggregate amount involved in the matter is `18.60 lakhs. The matter is currently pending.

4. Reliance Securities Limited

Cases filed against Reliance Securities Limited

Civil Cases

Amit Bhargava (“Appellant”) has preferred an appeal to the High Court of Judicature at Delhi against Reliance Securities Limited challenging the arbitration award dated December 24, 2009 in favour of Reliance Securities Limited. The Appellant had filed an arbitration application before a panel of arbitrators at NSE, New Delhi against Reliance Securities Limited claiming reversal of the contract executed on NSE among other claims towards damages and compensation. The amount involved in the matter is `1,900 lakhs. The matter is currently pending.

Arbitration Proceedings

Arbitration proceedings have been filed before the National Stock Exchange, by Rajesh Antony, Chennai and Omprakash Chincholikar, Mumbai alleging unauthorized transactions in their accounts amounting to `26.18 lakhs. These matters are pending.

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Consumer Cases 1. There are 5 (five) consumer complaints filed against Reliance Securities Limited before consumer disputes

redressal fora in various states and districts. The aggregate amount involved in these matters is `23.26 lakhs. The matters are currently pending.

2. Laxmi Tomar, Bhopal and Sanjay Mehta, Gujarat ("Appellant") have preferred appeals to the respective

State Consumer Dispute Redressal Commission, against the orders given by the District forum in favour of Reliance Securities Limited in respect of certain trades executed in illiquid scrip and unauthorised trades in their accounts by the company. The amount involved in these matters is `3.32 lakhs. The matters are currently pending.

3. Sajeena Abdul Latheef has filed a complaint against the Chairman and General Manager, Reliance Capital

Limited, the Branch Manager, Reliance Securities Limited and the Branch Manager, Reliance Mutual Fund before the Kerala State Consumer Dispute Redressal Commission at Thiruvananthapuram alleging unauthorized transactions in her account. The amount involved in this matter is `25.10 lakhs. The matter is currently pending.

4. Reliance Securities Limited (“Appellant”) has preferred two separate appeals to the State Consumer

Dispute Redressal Commission, Mumbai and one appeal to the State Commission, Jaipur for setting aside impugned order passed by the respective District Forum at Sindhudurg, and Jaipur. The amount involved in the matter is `9.25 lakhs. The matters are currently pending.

Tax Cases 2 (two) petitions were filed before the High Court of Judicature, Delhi against Reliance Securities Limited for reimbursement of service tax and claim of the balance rent under lease agreements for 2 (two) office premises rented by Reliance Securities Limited in Delhi. The High Court order in both matters was given against Reliance Securities Limited. Subsequently, Reliance Securities Limited has preferred an appeal against both the orders before the Supreme Court of India. The aggregate amount involved in these matters is `15.00 lakhs. The matters are currently pending.

Cases filed by Reliance Securities Limited Arbitration Proceedings 1. Reliance Securities Limited has preferred an appeal to the High Court of Judicature at Bombay against the

Arbitration award dated August 18, 2010 in the matter of arbitration before NSE, Mumbai in the case filed by Badrinath Bodhai against Reliance Securities Limited. The amount involved in the matter is `4.14 lakhs. The matter is currently pending.

2. Reliance Securities Limited has filed 12 arbitration petitions against its clients before various stock

exchanges for recovery of the outstanding ledger balance in the clients’ accounts. The amount involved in these matters is approximately `32.62 lakhs. In ten of these matters, the Arbitrator has passed orders in favour of Reliance Securities Limited. In one of these cases, the Arbitrator has passed orders against Reliance Securities Limited. These orders are pending execution. There has been no order in one of these matters.

Section 138 of the Negotiable Instruments Act, 1881

Reliance Securities Limited has filed criminal complaints under section 138 of the Negotiable Instruments Act, 1881, against 2 (two) clients for dishonour of cheques amounting to `9.84 lakhs. The matters are currently pending.

5. Reliance Commodities Limited

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Cases filed against Reliance Commodities Limited

Nil

Cases filed by Reliance Commodities Limited Criminal cases

Reliance Commodities has filed an application before the High Court of Judicature, at Ahmedabad for quashing of the criminal complaint pending before the local police at Ahmadabad in respect of the complaint filed by one of the commodity client alleging unauthorized transactions in his account along with his family member’s accounts. A settlement agreement was entered into between the parties and the same was communicated to FMC and MCX. The matter is currently pending.

Section 138 of the Negotiable Instruments Act, 1881

Reliance Commodities Limited has filed complaints under section 138 of the Negotiable Instruments Act, 1881, against 3 (three) customers for dishonour of cheques amounting to `13.7 lakhs. The Court has issued bailable warrants in all three complaints. The matters are pending.

6. Reliance Money Express Limited (RMEX) Cases filed against Reliance Money Express Limited Civil Cases

Pritpal Kaur has filed a suit before Civil Judge (Senior Division), Chandigarh against RMEX and others for recovery of arrears on lease rent pertaining to the Branch office occupied by Reliance Money Express Limited during the period 2008 to 2010. The amount involved is `1.03 lakhs. The matter is currently pending.

Cases filed by Reliance Money Express Limited Civil Cases

RMEX has filed a suit before the Subordinate Court at Kottayam against Cee & Cee Gold & Forex Pvt. Ltd & others for recovery of money advanced to them for conversion to foreign currency. The amount involved in the matter is `235 lakhs. The matter is pending.

Section 138 of the Negotiable Instruments Act, 1881

RMEX has filed complaints under Section 138 of the Negotiable Instruments Act, 1881, against a defaulting client, M/s Globe Explorer for dishonour of cheques amounting to `3.00 lakhs. The matter is pending.

7. Reliance Life Insurance Company Limited (RLIC)

Cases Filed against RLIC Criminal Cases

1. Two first information reports (“FIRs”) have been filed against certain employees, ex employees, advisors,

agents and distributors of Reliance Life Insurance Company Limited under various sections of the IPC. The FIRs have been filed in relation to allegations of inter alia forgery, cheating and criminal breach of trust.

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The matters are currently under police investigation.

2. Snehal Shah filed a criminal complaint, Criminal Case No. 294/SW/11, against, amongst others, Reliance Life Insurance Company Limited, Gautam Doshi, a director of our Company and an ex director of Reliance Life Insurance Company Limited, alleging criminal breach of trust and cheating in respect of an investment of `250.00 lakhs in the Reliance Money Guarantee Plan. The Ld. Metropolitan Magistrate 22nd Court, Andheri, Mumbai passed an order on October 4, 2011, issuing process and around November, 2011, summons was served on the respondents. On December 12, 2011, Gautam Doshi and others filed a writ petition, WP No. 3815 of 2011, before the High Court of Judicature at Bombay seeking to quash the said order and the summons. The High Court of Judicature at Bombay issued an ad-interim stay on the order of the Magistrate. Subsequently, Ankit Shah, son of Snehal Shah, lodged another complaint with the Senior Inspector of Police, Santa Cruz in respect of the same investment and summons were issued in the name of the above parties, for the purpose of investigation. The aforesaid fact was brought to the notice of the High Court and necessary amendments were carried out in the above petition. The High Court of Judicature at Bombay extended the ad-interim stay on the complaint filed by Ankit Shah. The matters are currently pending.

3. Three petitions have been filed before the High Court of Judicature at Karnataka, by Anusuya Ghosh and Vijay Swami, employees of the company, for quashing of the F.I.R. lodged before the Bhashwer Chowk Police Station, Nipani by Arvind Hiremath, Ashok Hiremath and Sreedhar Nayak alleging irregularity in the life insurance policies issued to them. The High Court of Judicature at Karnataka has granted interim stay on proceedings for eight weeks pursuant to its order dated September 5, 2011. The matters are currently pending..

Civil Cases

1. Dhruv Kumar (“Petitioner”) has filed a writ petition in the nature of public interest litigation before the Lucknow bench of High Court of Judicature at Allahabad against the Union of India, Insurance Regulatory and Development Authority, SEBI, Reliance Life Insurance Company Limited and 13 other insurance companies. The Petitioner is challenging the validity and sale of Unit Linked Insurance Products. The matter is currently pending.

2. Rajiv Lohia (“Plaintiff”) has filed a suit before the High Court of Judicature at Calcutta against Reliance Life Insurance Company Limited alleging non-payment of certain sums owed by Reliance Life Insurance Company Limited to the Plaintiff. The amount involved in the matter is `10.52 lakhs along with interest at a rate of 18% p.a. The matter is currently pending.

3. Suprabha Ghosh and two others (“Petitioners”) have filed a writ petition before the High Court of Judicature at Orissa against the Life Insurance Corporation of India, regional manager of Reliance Life Insurance Company Limited and Manjula Sahoo. The Petitioner seeks to prevent Reliance Life Insurance Company Limited from paying amounts due under a policy of `5.00 lakhs taken by Suratha Kumar Sahoo alleging that the Petitioner is entitled to a percentage of the amounts payable pursuant to a will executed by Suratha Kumar Sahoo. The matter is currently pending.

4. Bal Natrajan (“Petitioner”) has filed a writ petition before the High Court of Judicature at Kerala challenging the order dated August 31, 2007 of the Insurance Ombudsman, Cochin. The Petitioner is challenging the cancellation of an insurance policy by Reliance Life Insurance Company Limited. The amount involved in the matter is `0.50 lakhs. The matter is currently pending.

5. 59 civil cases have been filed before various civil courts against Reliance Life Insurance Company Limited for disputes in relation to inter alia repudiation of claims, recovery of commission, commercial disputes, injunction for termination of services and termination of lease deeds. The amount involved in the matters is approximately `168.00 lakhs. The matters are currently pending.

6. 16 cases have been filed before Lok Adalats at various locations against Reliance Life Insurance Company Limited involving disputes relating to repudiation of claims, wrongful termination and deficiency in

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service. The amount involved in these matters is approximately `44.00 lakhs. The matters are currently pending.

7. Hartford Academy of Insurance and Education Private Limited have filed a suit before the High Court of Judicature at Chennai against Reliance Life Insurance Company Limited for recovering an amount of `94.72 lakhs towards the alleged unpaid bills. The matter is currently pending.

Arbitration Cases

Syntel Global Private Limited (“Claimant”) has commenced arbitration proceedings before Rohit Kapadia, Arbitrator, Mumbai against Reliance Life Insurance Company Limited alleging non-provision of services required to be rendered under letters of intent dated March 1, 2008 and April 1, 2008 issued by Reliance Life Insurance Company Limited and a master services agreement dated September 19, 2008 entered into with Reliance Life Insurance Company Limited. The Claimant seeks payment of `1,120.25 lakhs with interest at a rate of 18% p.a. along with the arbitration costs or a sum of `989.17 lakhs for expenditure incurred towards setting up office infrastructure along with the arbitration costs. The matter is currently pending.

Tax Cases 1. Reliance Life Insurance Company Limited has preferred an appeal to the Commissioner of Income Tax

(Appeals), Chennai (“CIT”) against an order passed by the Assistant Director of Income Tax, International Taxation, Chennai, in relation to classification of royalty payment made to the AMP Group, Australia. The amount involved in the matter is `5.23 lakhs. The matter is currently pending.

2. Reliance Life Insurance Company Limited has preferred an appeal to the Small Causes Court of Bombay against an order dated August 8, 2008 passed by the Municipal Corporation of Greater Mumbai (“MCGM”) directing Reliance Life Insurance Company Limited to pay property tax in accordance with the enhanced value of a leasehold property of Reliance Life Insurance Company Limited in Ghatkopar, Mumbai. The MCGM has filed the details of computation of the property tax, claiming arrears of `93.00 lakhs from Reliance Life Insurance Company Limited before the Court and Reliance Life Insurance Company Limited has replied to the same. The amount involved in the matter is `21.30 lakhs. The matter is currently pending.

3. Reliance Life Insurance Company Limited has preferred an appeal to the Commissioner (Appeals) in Customs Excise and Service Tax Appellate Tribunal (“CESTAT”), South Zonal Bench, Chennai against an order of the Commissioner (Appeal), Chennai in relation to disallowance of ineligible credit of service tax. The amount involved in the matter is `33.80 lakhs. The matter is currently pending.

Labour Cases 7 complaints have been filed before different labour conciliation officers against Reliance Life Insurance Company Limited involving allegations of inter alia illegal termination and non-payment of wages. Reliance Life Insurance Company Limited has filed its replies before the respective labour authorities.

Consumer Cases

1. 44 appeals have been preferred to the respective State Consumer Disputes Redressal Commissions

challenging the orders of the various District Consumer Disputes Redressal Forums passed in favour of Reliance Life Insurance Company Limited. The amount involved in the matters is approximately `340.00 lakhs. The matters are currently pending.

2. 444 consumer complaints have been filed before consumer disputes redressal fora in various districts and states of India against Reliance Life Insurance Company Limited. These matters involve allegations relating to inter alia claims repudiation, non-receipt of policy documents and deficiency of service. The amount involved in the matters is approximately `1170.00 lakhs. The matters are currently pending.

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3. Reliance Life Insurance Company Limited has preferred 60 appeals to various State Consumer Disputes Redressal Forums against orders of the respective District Consumer Disputes Redressal Commissions. The amount involved in the matters is approximately `172.00 lakhs.The matters are currently pending.

Insurance Cases

1. 581 complaints have been filed before the Insurance Ombudsman at various locations against Reliance Life Insurance Company Limited involving disputes relating to inter alia refusal to refund the premium, cancellation of policy, unilaterally change in terms of the policy. The amount involved in these matters is not ascertainable. Reliance Life Insurance Company Limited has replied to 531 complaints and is in the process of replying to the remaining complaints.

2. 2,749 complaints have been filed by policy holders received and have been received by Reliance Life Insurance Company Limited from Insurance Regulatory and Development Authority and Life Council involving disputes relating to inter alia miss-selling, non-processing claims, repudiation of claims, rejection of claims, refusal to refund premium amounts, non-issue of premium receipts, unilaterally changing the terms of the policy, non receipt of the policy documents, recovery of money, fraud committed by employees of Reliance Life Insurance Company Limited and deficiency of services. The amount involved in these cases is not ascertainable. Reliance Life Insurance Company Limited has replied to 2,698 complaints and is in the process of replying to the remaining 51 complaints.

Notices 1. 278 inspection notices were issued by various labour enforcement officers against different branches of

Reliance Life Insurance Company Limited in relation to compliances under labour laws. Reliance Life Insurance Company Limited has replied to 274 of these notices and is in the process of replying to the 4 remaining notices.

2. 302 legal notices were issued against Reliance Life Insurance Company Limited in relation to various issues pertaining to policy matters having claim and non-claim disputes, notices from statutory / regulatory authorities, non-payment of the lease rentals, commercial disputes, unilateral termination or breach of lease / leave and license agreements. We have replied to 284 notices and 18 are in the process of being replied. The amount involved in the matters is approximately `377.00 lakhs.

Cases Filed by RLIC Criminal Cases

1. 27 FIRs have been filed by Reliance Life Insurance Company Limited in various police stations, against

different individuals. These cases relate to misappropriation of premium amount, dishonest misappropriation of cheques, issuance of fake receipt, theft at office premise, etc. The aggregate amount involved in the matters is Nil. The investigations in relation to these matters are ongoing and the matters are currently pending.

2. Reliance Life Insurance Company Limited has filed separate criminal cases against Siddharth Patel and Parin Mistry, former employees, for misappropriation of money, cheating and forgery. The aggregate amount involved in the matters is `8.50 lakhs. The matters are currently pending.

Civil Cases

1. Reliance Life Insurance Company Limited has filed four separate civil suits before the High Court at

Bombay against Dawnay Day, Sanjay Jadhav, Rajiv Lohia and Naizi Mohammad (“Defendants”) for recovery of amounts due to Reliance Life Insurance Company Limited from the Defendants. The matters involve disputes relating to inter alia unsatisfactory services rendered by the service provider, breach of contract and excess payment of remuneration. The amount involved in the matters is approximately `765.52 lakhs. The matters are currently pending.

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2. Reliance Life Insurance Company Limited has filed five civil suits before the City Civil Court, Mumbai against four former employees namely Abhinav Chahad, Rajeev Singh, Jasmine Kapadia, Santosh Singh and Rajendra Bartiya (“Defendants”) for recovery of amounts due for the alleged breach of the respective employment contracts of the Defendants. The amount involved in the matters is `2.28 lakhs. The matters are currently pending.

3. Reliance Life Insurance Company Limited has filed a writ petition before the High Court of Judicature at Allahabad against Insurance Ombudsman, U.P. and Uttrakhand and Vijay Kumar Gupta challenging an award of the Insurance Ombudsman, Lucknow pertaining to computation of the premium amount. The matter is currently pending.

4. Reliance Life Insurance Company Limited has filed a writ petition before the High Court of Judicature at Hyderabad against Insurance Ombudsman, (A.P., Karnataka and Yanam) and M. Subhash challenging an award dated February 7, 2010 of the Insurance Ombudsman, Hyderabad pertaining to payment of sum assured to the nominee after the death of life assured. The amount involved in the matter is `1.00 lakhs. The matter is currently pending.

5. Reliance Life Insurance Company Limited has filed a writ petition before the High Court of Judicature at Chandigarh against permanent Lok Adalat, Gurgaon and Surendra Kumar challenging an award dated March 21, 2011 of the permanent Lok Adalat, Gurgaon pertaining to payment of claim arising out of health insurance. The amount involved in the matter is `2.10 lakhs. The matter is currently pending.

6. Reliance Life Insurance Company Limited has filed a writ petition before the High Court of Judicature at Lucknow against Insurance Ombudsman, U.P and Uttarakhand and Sudhir Srivastava challenging the award of the Insurance Ombudsman, Lucknow pertaining to claim related to Total Permanent Disability rider in the concerned policy. The matter is currently pending.

7. Reliance Life Insurance Company Limited has filed a writ petition before the High Court of Judicature at Guwahati against Insurance Ombudsman, Assam, Meghalaya, Mizoram, Arunachal Pradesh, Nagaland & Tripura and Ajijul Haque challenging the award of the Insurance Ombudsman, Assam, Meghalaya, Mizoram, Arunachal Pradesh, Nagaland & Tripura pertaining to claim related to repudiation of claim based on suppression of material facts. The matter is currently pending.

Arbitration Proceedings

Reliance Life Insurance Company Limited has commenced arbitration proceedings before arbitrator M.P.S. Rao against Azilon Software Solutions Limited (“Azilon”) in relation to the non-provision of services by Azilon pursuant to a master services agreement dated July 26, 2007 entered into by Azilon with Reliance Life Insurance Company Limited. Reliance Life Insurance Company Limited had released 30% of the agreed services fees i.e. `9.36 lakhs under the agreement which has already been realized by Azilon. The Bombay High Court pursuant to its order dated January 21, 2011 appointed M. P. S. Rao as a sole arbitrator to adjudicate the matter. The amount involved in the matter is `9.36 lakhs along with `100.00 lakhs towards damages. The matter is currently pending.

8. Reliance Home Finance Limited Cases filed against Reliance Home Finance Limited

Consumer Cases

There are 6 consumer cases filed against Reliance Home Finance Limited in various courts in respect of disbursement of loan amounts. These cases involve an amount of `205.38 lakhs and are at various stages of adjudication.

Cases filed by Reliance Home Finance Limited

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Criminal Cases

There are 75 cases filed by Reliance Home Finance Limited before various Metropolitan Magistrate Courts for recovery of dues and dishonor of cheques which were given for repayment of loan. The cases involve an aggregate of `18,800.62 lakhs and are at various stages of adjudication.

Arbitration Proceedings

There are 43 cases filed by Reliance Home Finance Limited before the sole arbitrator for recovery of dues in respect of loan facilities granted by it to its various customers. The cases involve an aggregate amount of `2,513.89 lakhs and are at various stages of adjudication.

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GOVERNMENT AND OTHER APPROVALS

On the basis of the approvals listed below, our Company can undertake this Issue and our current business activities and other than disclosed below no further material approvals from any governmental or regulatory authority or any other entity are required to undertake the Issue or continue our business activities. Unless otherwise stated, these approvals are all valid as of the date of this Draft Letter of Offer. I. Tax related and other approvals

1. Permanent Account Number AAACA4252H. 2. Tax Deduction Account Number MUMA20296D under the Income Tax Act, 1961.

3. Permits to pay the entertainment tax and additional tax on basis of return granted by the

Commercial Tax Department of relevant State Government. 4. Registration under the Central Sales Tax (Registration and Turnover) Rules, 1957 granted by the

Commercial Tax Department of relevant State Government.

5. Registration under the relevant state value added tax rules granted by the Commercial Tax Department of relevant State Government.

II. Approvals in relation to human resources

1. Provident Fund Number MH / BAN / 45577.

2. Employee State Insurance Corporation Number 31 - 43575 – 122.

3. We have obtained the following Professional Tax Registration under the relevant state laws:

(i) State of Maharashtra (all locations): 27960001845P; (ii) State of Gujarat (Vapi): PE2507001542; (iii) State of Madhya Pradesh (all locations): 78271103303; (iv) State of Andhra Pradesh (all locations, except Vizianagaram): 28405770417; (v) State of Tamil Nadu (all locations): 08-117-PE-0034; and (vi) West Bengal (all locations): RCE0037281.

III. Approvals in relation to the Business

Our Company is required to obtain various approvals in relation to our business. The registrations and approvals required to be obtained by our Company usually in respect of our business in India include the following: Cinema Licenses

1. License for cinema issued by the Commissioner of Police of the cities where the theaters of our

Company are located.

2. License to sell tickets for admission to a cinema issued by the Commissioner of Police / Deputy Commissioner of the cities where the theaters of our Company are located.

3. License for exhibition of cinematograph shows in theatres issued by the District Magistrate / Deputy Commissioner of the cities where the theaters of our Company are located.

Municipality Laws

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1. Licenses for storage of cinematograph films issued by license department of the relevant local

municipalities.

2. Licenses for establishment of cafeteria in theatres managed and operated by our Company issued by license department of the relevant local municipalities.

3. Certificate for sanitary convenience issued by health department of the relevant local municipalities.

4. No objection certificates for disposal of treated sewage/effluents issued by the relevant local municipalities.

Environmental Regulations

Consents from the State Pollution Control Board to operate under the provisions of the Water (Prevention and Control of Pollution) Act, 1974 and Air (Prevention and Control of Pollution) Act, 1981. Labour Laws Registration Certificate of contract labours under the Contract Labour (Registration and Abolition) Act, 1970 issued by the relevant state authorities. Prevention of Food Adulteration Laws

License under the Prevention of Food Adulteration Act, 1954 and the Prevention of Food Adulteration Rules, 1955 issued by the relevant state authorities. Shops and Establishments Legislations Registration Certificate of Establishment under the Shops and Establishment Act, 1948 as issued by the Corporation of the cities where the theaters of our Company are located.

Fire and Emergency Service Laws Fire license issued by the Directorate of Fire and Emergency Services under the Fire Force Act, applicable in the states where the theatres of our Company are situated.

Certain approvals may have elapsed in their normal course and our Company has applications to the relevant authorities for renewal of such licenses and / or approvals or is in the process of making such applications. We undertake to obtain all approvals, licenses, registrations and permissions required to operate our business.

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OTHER REGULATORY AND STATUTORY DISCLOSURES Authority for the Issue The Issue has been authorised by a resolution of our Board of Directors passed at their meeting held on July 25, 2012, pursuant to Section 81 (1) of the Companies Act. The Draft Letter of Offer has been approved by the Committee of Directors on July 28, 2012. Our Company received in-principle approvals from the BSE and the NSE for the listing of the Equity Shares pursuant to letters dated [●] and [●], respectively. Prohibition by SEBI or Other Governmental Authorities Our Company, Promoters, Directors, Promoter Group and Group Companies, have not been prohibited from accessing or operating in capital markets under any order or direction passed by SEBI or any other regulatory or governmental authority. The companies, with which our Promoters, Directors or persons in control of our Company are associated as promoter, directors or persons in control have not been prohibited from accessing in capital markets under any order or direction passed by SEBI or any other regulatory or governmental authority. There has been no action taken by SEBI against our Directors or any entity our Directors are involved in as promoters or directors. Details of the entities that our Directors are associated with, which are engaged in securities market related business and are registered with SEBI for the same are as follows: Name of the Director Sujal Shah Name of the entity Keynote Corporate Services Limited SEBI Registration Number of the entity INM 0000 03606 If registration has elapsed, reason for non-renewal Registration is valid till December 15, 2011 Details of any inquiry/investigation conducted by SEBI at any time

Details as given below

Penalty imposed by SEBI (penalty includes deficiency/warning letter, adjudication proceedings, suspension/cancellation/prohibitory order

(i) Keynote Corporate Services Limited’s (Keynote) certificate of registration was suspended for a period of two months pursuant to a SEBI order dated September 26, 2003 in relation to the matter of public issue of Maha Chemicals Limited which opened for subscription in April 1994. Keynote was one of the lead managers to the said issue. The Presiding Officer, Securities Appellate Tribunal pursuant to his order dated October 21, 2003 stayed the order dated September 26, 2003. Further, pursuant to a subsequent order of April 21, 2004, SAT directed Keynote not to negotiate, accept or act upon any new assignments for two months. The matter has been settled.

(ii) A show cause notice was issued by SEBI to Keynote in relation to a public cum rights issue of Majestic Industries Limited during the year 1996. In June 2009, Keynote filed consent terms with SEBI which was further revised pursuant to a letter dated August 7, 2009. SEBI by its order

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dated February 15, 2010 approved the consent terms. The matter has been settled.

(iii) SEBI issued a show cause notice dated January

30, 2004 to Keynote in relation to the public issue of Andhra Pradesh Power Tools Limited. A personal hearing was conducted on September 16, 2005. Subsequently, a further show cause notice dated June 7, 2011 was issued by SEBI enclosing the report of the Enquiry Officer. The Enquiry Officer in his report had recommended to SEBI to terminate the proceedings against Keynote as no charges were established. Keynote has filed its reply dated June 24, 2011 with SEBI. A personal hearing was scheduled on September 2, 2011 and subsequently, Keynote has on April 13, 2012, filed its consent terms.

(iv) SEBI has issued a show cause notice dated

September 9, 2008 to Keynote in relation to the public issue of Nissan Copper Limited. Consent terms dated December 8, 2008 were filed by Keynote Corporate Services Limited with SEBI. SEBI by its order dated April 9, 2009 approved the consent terms. The matter has been settled.

(v) A show cause notice dated May 20, 2011 was

issued by SEBI to Keynote Corporate Services Limited in relation to a public issue of Emmbi Polyarns Limited dealt with during the year 2010. Keynote has filed its reply dated July 12, 2011. Subsequently, on October 10, 2011 a personal hearing was granted. The matter is currently pending.

(vi) SEBI has passed an order dated January 31, 2012 against Keynote imposing a penalty of ` 10 lakhs in relation to the public issue of Edserve Softsystems Limited. Keynote has filed an appeal to the SAT on March 13, 2012. The matter is pending.

Outstanding fee payable to SEBI by the entity, if any Nil Prohibition by RBI Neither our Company nor its Promoters, Directors, Group Companies or relatives (as per the Companies Act) of our Promoters are identified as willful defaulters by the RBI or any other governmental authority. There are no violations of securities laws committed by them in the past or are pending against them. Eligibility for the Issue Our Company is a listed company and has been incorporated under the Companies Act. Our Equity Shares are presently listed on the Stock Exchanges. It is eligible to offer this issue in terms of Chapter IV of the ICDR Regulations. It is eligible to offer the Issue in terms of Chapter IV of the ICDR Regulations.

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Please note that our Company has undergone a change of control consequent to an acquisition of its majority stake by the Reliance Group in June 2005 in accordance with the Takeover Regulations and is making a rights issue of its securities for the first time subsequent to such change of control in accordance with clause (3)(a) of Part E of Schedule VIII of ICDR Regulation. Therefore, the disclosures in the DLOF have been made in accordance with Part A of Schedule VIII of the ICDR Regulations, except for disclosures as specified in clause (4) of Part E of Schedule VIII of the ICDR Regulations. DISCLAIMER CLAUSE OF SEBI AS REQUIRED, A COPY OF THIS DRAFT LETTER OF OFFER HAS BEEN SUBMITTED TO SEBI. IT IS TO BE DISTINCTLY UNDERSTOOD THAT THE SUBMISSION OF THIS DRAFT LETTER OF OFFER TO SEBI SHOULD NOT, IN ANY WAY BE DEEMED OR CONSTRUED THAT THE SAME HAS BEEN CLEARED OR APPROVED BY SEBI. SEBI DOES NOT TAKE ANY RESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR THE PROJECT FOR WHICH THE ISSUE IS PROPOSED TO BE MADE, OR FOR THE CORRECTNESS OF THE STATEMENTS MADE OR OPINIONS EXPRESSED IN THIS DRAFT LETTER OF OFFER. THE LEAD MANAGER, YES BANK LIMITED HAS CERTIFIED THAT THE DISCLOSURES MADE IN THIS DRAFT LETTER OF OFFER ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH SEBI (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 IN FORCE FOR THE TIME BEING. THIS REQUIREMENT IS TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION FOR MAKING INVESTMENT IN THE PROPOSED ISSUE. IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE ISSUER COMPANY IS PRIMARILY RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT INFORMATION IN THIS DRAFT LETTER OF OFFER, THE LEAD MANAGER IS EXPECTED TO EXERCISE DUE DILIGENCE TO ENSURE THAT THE COMPANY DISCHARGES ITS RESPONSIBILITY ADEQUATELY IN THIS BEHALF AND TOWARDS THIS PURPOSE THE LEAD MANAGER, YES BANK LIMITED WILL FURNISH TO SEBI A DUE DILIGENCE CERTIFICATE WHICH WILL READ AS FOLLOWS: (1) WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO

LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH COLLABORATORS, ETC. AND OTHER MATERIAL IN CONNECTION WITH THE FINALISATION OF THIS DRAFT LETTER OF OFFER PERTAINING TO THE ISSUE;

(2) ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE COMPANY, OUR DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES, AND INDEPENDENT VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTS OF THE ISSUE, PRICE JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTS AND OTHER PAPERS FURNISHED BY THE COMPANY, WE CONFIRM THAT:

(a) THIS DRAFT LETTER OF OFFER FILED WITH THE BOARD IS IN CONFORMITY

WITH THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE ISSUE;

(b) ALL THE LEGAL REQUIREMENTS RELATING TO THE ISSUE AS ALSO THE REGULATIONS GUIDELINES, INSTRUCTIONS, ETC. FRAMED/ISSUED BY THE BOARD, THE CENTRAL GOVERNMENT AND ANY OTHER COMPETENT AUTHORITY IN THIS BEHALF HAVE BEEN DULY COMPLIED WITH; AND

(c) THE DISCLOSURES MADE IN THIS DRAFT LETTER OF OFFER ARE TRUE, FAIR AND ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL INFORMED DECISION AS TO THE INVESTMENT IN THE PROPOSED ISSUE AND SUCH DISCLOSURES ARE IN ACCORDANCE WITH THE REQUIREMENTS OF THE COMPANIES ACT, 1956, THE SECURITIES AND EXCHANGE BOARD OF INDIA

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(ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 AND OTHER APPLICABLE LEGAL REQUIREMENTS.

(3) WE CONFIRM THAT BESIDES OURSELVES, ALL THE INTERMEDIARIES NAMED IN THIS

DRAFT LETTER OF OFFER ARE REGISTERED WITH THE BOARD AND THAT TILL DATE SUCH REGISTRATION IS VALID.

(4) WE HAVE SATISFIED OURSELVES ABOUT THE CAPABILITY OF THE UNDERWRITERS TO FULFIL THEIR UNDERWRITING COMMITMENTS – NOT APPLICABLE

(5) WE CERTIFY THAT WRITTEN CONSENT FROM PROMOTERS HAS BEEN OBTAINED FOR INCLUSION OF THEIR SPECIFIED SECURITIES AS PART OF PROMOTERS’ CONTRIBUTION SUBJECT TO LOCK-IN AND THE SPECIFIED SECURITIES PROPOSED TO FORM PART OF PROMOTERS’ CONTRIBUTION SUBJECT TO LOCK-IN SHALL NOT BE DISPOSED / SOLD / TRANSFERRED BY THE PROMOTERS DURING THE PERIOD STARTING FROM THE DATE OF FILING THE DRAFT RED HERRING PROSPECTUS/DRAFT PROSPECTUS WITH THE BOARD TILL THE DATE OF COMMENCEMENT OF LOCK-IN PERIOD AS STATED IN THE DRAFT RED HERRING PROSPECTUS/DRAFT PROSPECTUS – NOT APPLICABLE

(6) WE CERTIFY THAT REGULATION 33 OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009, WHICH RELATES TO SPECIFIED SECURITIES INELIGIBLE FOR COMPUTATION OF PROMOTERS CONTRIBUTION, HAS BEEN DULY COMPLIED WITH AND APPROPRIATE DISCLOSURES AS TO COMPLIANCE WITH THE SAID REGULATION HAVE BEEN MADE IN THE DRAFT RED HERRING PROSPECTUS/DRAFT PROSPECTUS – NOT APPLICABLE

(7) WE UNDERTAKE THAT SUB-REGULATION (4) OF REGULATION 32 AND CLAUSE (C) AND (D) OF SUB-REGULATION (2) OF REGULATION 8 OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 SHALL BE COMPLIED WITH. WE CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT PROMOTERS’ CONTRIBUTION SHALL BE RECEIVED AT LEAST ONE DAY BEFORE THE OPENING OF THE ISSUE. WE UNDERTAKE THAT AUDITORS’ CERTIFICATE TO THIS EFFECT SHALL BE DULY SUBMITTED TO THE BOARD. WE FURTHER CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT PROMOTERS’ CONTRIBUTION SHALL BE KEPT IN AN ESCROW ACCOUNT WITH A SCHEDULED COMMERCIAL BANK AND SHALL BE RELEASED TO THE ISSUER ALONG WITH THE PROCEEDS Of THE PUBLIC ISSUE – NOT APPLICABLE

(8) WE CERTIFY THAT THE PROPOSED ACTIVITIES OF THE COMPANY FOR WHICH THE FUNDS ARE BEING RAISED IN THE PRESENT ISSUE FALL WITHIN THE ‘MAIN OBJECTS’ LISTED IN THE OBJECT CLAUSE OF THE MEMORANDUM OF ASSOCIATION OR OTHER CHARTER OF THE COMPANY AND THAT THE ACTIVITIES WHICH HAVE BEEN CARRIED OUT UNTIL NOW ARE VALID IN TERMS OF THE OBJECT CLAUSE OF ITS MEMORANDUM OF ASSOCIATION.

(9) WE CONFIRM THAT NECESSARY ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT THE MONEYS RECEIVED PURSUANT TO THE ISSUE ARE KEPT IN A SEPARATE BANK ACCOUNT AS PER THE PROVISIONS OF SUB-SECTION (3) OF SECTION 73 OF THE COMPANIES ACT, 1956 AND THAT SUCH MONEYS SHALL BE RELEASED BY THE SAID BANK ONLY AFTER PERMISSION IS OBTAINED FROM ALL THE STOCK EXCHANGES MENTIONED IN THE LETTER OF OFFER. WE FURTHER CONFIRM THAT THE AGREEMENT ENTERED INTO BETWEEN THE BANKERS TO THE ISSUE AND THE ISSUER SPECIFICALLY CONTAINS THIS CONDITION - NOTED FOR COMPLIANCE

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(10) WE CERTIFY THAT A DISCLOSURE HAS BEEN MADE IN THIS DRAFT LETTER OF OFFER THAT THE INVESTORS SHALL BE GIVEN AN OPTION TO GET THE SHARES IN DEMAT OR PHYSICAL MODE.

(11) WE CERTIFY THAT ALL THE APPLICABLE DISCLOSURES MANDATED IN THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 HAVE BEEN MADE IN ADDITION TO DISCLOSURES WHICH, IN OUR VIEW, ARE FAIR AND ADEQUATE TO ENABLE THE INVESTOR TO MAKE A WELL INFORMED DECISION.

(12) WE CERTIFY THAT THE FOLLOWING DISCLOSURES HAVE BEEN MADE IN THIS DRAFT LETTER OF OFFER:

(a) AN UNDERTAKING FROM THE ISSUER THAT AT ANY GIVEN TIME, THERE

SHALL BE ONLY ONE DENOMINATION FOR THE EQUITY SHARES OF THE COMPANY AND

(b) AN UNDERTAKING FROM THE COMPANY THAT IT SHALL COMPLY WITH SUCH DISCLOSURE AND ACCOUNTING NORMS SPECIFIED BY THE BOARD FROM TIME TO TIME.

(13) WE UNDERTAKE TO COMPLY WITH THE REGULATIONS PERTAINING TO

ADVERTISEMENT IN TERMS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009 WHILE MAKING THE ISSUE.

(14) WE ENCLOSE A NOTE EXPLAINING HOW THE PROCESS OF DUE DILIGENCE HAS BEEN EXERCISED BY US IN VIEW OF THE NATURE OF CURRENT BUSINESS BACKGROUND OR THE ISSUER, SITUATION AT WHICH THE PROPOSED BUSINESS STANDS, THE RISK FACTORS, PROMOTERS EXPERIENCE ,ETC.

(15) WE ENCLOSE A CHECKLIST CONFIRMING REGULATION-WISE COMPLIANCE WITH THE APPLICABLE PROVISIONS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009, CONTAINING DETAILS SUCH AS THE REGULATION NUMBER, ITS TEXT, THE STATUS OF COMPLIANCE, PAGE NUMBER OF THIS DRAFT LETTER OF OFFER WHERE THE REGULATION HAS BEEN COMPLIED WITH AND OUR COMMENTS, IF ANY.

THE FILING OF THIS DRAFT LETTER OF OFFER DOES NOT, HOWEVER, ABSOLVE THE COMPANY FROM ANY LIABILITIES UNDER SECTION 63 OR SECTION 68 OF THE COMPANIES ACT OR FROM THE REQUIREMENT OF OBTAINING SUCH STATUTORY OR OTHER CLEARANCE AS MAY BE REQUIRED FOR THE PURPOSE OF THE PROPOSED ISSUE. SEBI FURTHER RESERVES THE RIGHT TO TAKE UP, AT ANY POINT OF TIME, WITH THE LEAD MANAGER ANY IRREGULARITIES OR LAPSES IN THIS DRAFT LETTER OF OFFER. Caution Disclaimer clauses from our Company and the Lead Manager Our Company and the Lead Manager accept no responsibility for statements made otherwise than in this Draft Letter of Offer or in any advertisement or other material issued by our Company or by any other persons at the instance of our Company and anyone placing reliance on any other source of information would be doing so at his own risk. The Lead Manager and our Company shall make all information available to the Equity Shareholders and no selective or additional information would be available for a section of the Equity Shareholders in any manner

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whatsoever including at presentations, in research or sales reports etc. after filing of this Draft Letter of Offer with SEBI. No dealer, salesperson or other person is authorised to give any information or to represent anything not contained in this document. You must not rely on any unauthorised information or representations. This Draft Letter of Offer is an offer to sell only the Equity Shares and rights to purchase the Equity Shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this Draft Letter of Offer is current only as of its date. Investors who invest in the Issue will be deemed to have represented to our Company and Lead Manager and their respective directors, officers, agents, affiliates and representatives that they are eligible under all applicable laws, rules, regulations, guidelines and approvals to acquire Equity Shares, and are relying on independent advice / evaluation as to their ability and quantum of investment in the Issue. Disclaimer with respect to jurisdiction This Draft Letter of Offer has been prepared under the provisions of Indian laws and the applicable rules and regulations thereunder. Any disputes arising out of the Issue will be subject to the jurisdiction of the appropriate court(s) in Mumbai, India only. Designated Stock Exchange The Designated Stock Exchange for the purpose of the Issue will be [●]. Disclaimer Clause of the BSE As required, a copy of this Draft Letter of Offer has been submitted to the BSE. The Disclaimer Clause as intimated by the BSE to us, post scrutiny of this Draft Letter of Offer, shall be included in the Letter of Offer prior to filing with the Stock Exchanges. Disclaimer Clause of the NSE As required, a copy of this Draft Letter of Offer has been submitted to the NSE. The Disclaimer Clause as intimated by the NSE to us, post scrutiny of this Draft Letter of Offer, shall be included in the Letter of Offer prior to filing with the Stock Exchanges. Selling Restrictions The distribution of this Draft Letter of Offer and the issue of Equity Shares on a rights basis to persons in certain jurisdictions outside India may be restricted by legal requirements prevailing in those jurisdictions. Persons into whose possession this Draft Letter of Offer may come are required to inform themselves about and observe such restrictions. Our Company is making the Issue of Equity Shares on a rights basis to the Equity Shareholders of our Company and will dispatch the Letter of Offer and CAFs only to Equity Shareholders who have provided an Indian address. No action has been or will be taken to permit the a public offering of the Equity Shares or Rights Entitlement to occur in any jurisdiction, or the possession, circulation, or distribution of this Draft Letter of Offer or any other material relating to our Company, the Equity Shares or Rights Entitlement in any jurisdiction, where action would be required for that purpose, except that this Draft Letter of Offer has been filed with SEBI. Accordingly, the Equity Shares and Rights Entitlement may not be offered or sold, directly or indirectly, and none of this Draft Letter of Offer or any offering materials or advertisements in connection with the Equity Shares or Rights Entitlement may be distributed or published in any jurisdiction, except in accordance with legal requirements applicable in such jurisdiction. Receipt of this Draft Letter of Offer will not constitute an offer in those jurisdictions in which it would be illegal to make such an offer.

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This Draft Letter of Offer and its accompanying documents are being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, in whole or in part, for any purpose. If this Draft Letter of Offer is received by any person in any jurisdiction where to do so would or might contravene local securities laws or regulation, or by their agent or nominee, they must not seek to subscribe to the Equity Shares or the Rights Entitlement referred to in this Draft Letter of Offer. Investors are advised to consult their legal counsel prior to accepting any provisional allotment of Equity Shares, applying for excess Equity Shares or Rights Entitlement or making any offer, sale, resale, pledge or other transfer of the Equity Shares or Rights Entitlement. Neither the delivery of this Draft Letter of Offer nor any sale hereunder, shall under any circumstances create any implication that there has been no change in our Company’s affairs from the date hereof or that the information contained herein is correct as of any time subsequent to this date. Each person who exercises Rights Entitlement and subscribes for Equity Shares or excess Equity Shares, or who purchases Rights Entitlement or Equity Shares shall do so in accordance with the restrictions set out below. United States Restrictions The Rights Entitlement and the Equity Shares have not been, and will not be, registered under the Securities Act or under any securities laws of any state or other jurisdiction of the United States and may not be offered, sold, resold, allotted, taken up, exercised, renounced, pledged, transferred or delivered, directly or indirectly, within the United States (as defined in Regulation S). The Issue to which this Draft Letter of Offer relates is not, and under no circumstances is to be construed as, an offering of any Equity Shares or Rights Entitlement for sale in the United States or as a solicitation therein of an offer to buy any of the said Equity Shares or Rights Entitlement. Accordingly, this Draft Letter of Offer and the CAF should not be forwarded to or transmitted in or into the United States at any time. Any person who acquires Rights Entitlements or Equity Shares will be deemed to have declared, warranted and agreed, by accepting the delivery of this Draft Letter of Offer, that it is not and that at the time of subscribing for the Equity Shares or the Rights Entitlements, it will not be, in the United States and is not a U.S. person (as defined in Regulation S). The Rights Entitlement and the Equity Shares have not been approved or disapproved by the U.S. Securities and Exchange Commission, any state securities commission in the United States or any other U.S. regulatory authority, nor have any of the foregoing authorities passed upon or endorsed the merits of the offering of the Rights Entitlement, the Equity Shares or the accuracy or adequacy of this Draft Letter of Offer. Any representation to the contrary is a criminal offence in the United States. Neither our Company nor any person acting on behalf of our Company will accept a subscription or renunciation from any person, or the agent of any person, who appears to be, or who our Company or any person acting on behalf of our Company has reason to believe is, in the United States. Any envelope containing a CAF and postmarked from the United States will not be accepted. Similarly, any CAF in which the exercising holder or subscribing applicant requests Equity Shares to be issued in registered form or credited to a securities account and gives an address in the United States will not be accepted. Our Company reserves the right to treat as invalid any CAF which: (i) appears to our Company or its agents to have been executed in or dispatched from the United States; (ii) does not include the relevant certifications; or (iii) where our Company believes acceptance of such CAF may infringe applicable legal or regulatory requirements; and our Company shall not be bound to allot or issue any Equity Shares or Rights Entitlement in respect of any such CAF. Any payment made in respect of any CAF that does not meet the foregoing criteria will be returned without interest. Any person in the United States who obtains a copy of this Draft Letter of Offer or its accompanying documents is required to disregard it. Until the expiration of the 40 day period beginning on the date on which our Company will allot and issue the Equity Shares, an offer to sell or a sale of, or subscription for, the Rights Entitlement or the Equity Shares within the United States by a broker / dealer (whether or not it is participating in the Issue) may violate the registration requirements of the Securities Act.

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Each purchaser of the Rights Entitlement and / or the Equity Shares will be deemed to have represented and agreed as follows (terms defined in Regulation S have the same meanings when used herein): (a) the purchaser (i) is, and the person, if any, for whose account it is acquiring such Rights Entitlement and/or

the Equity Shares is, outside the United States, and (ii) is acquiring the Rights Entitlement and/or the Equity Shares in an offshore transaction meeting the requirements of Regulation S;

(b) the purchaser is aware that the Rights Entitlement and the Equity Shares have not been and will not be registered under the Securities Act and are being distributed and offered outside the United States in reliance on Regulation S; and

(c) the purchaser acknowledges that our Company, the Lead Manager, their affiliates and others will rely upon the truth and accuracy of the foregoing representations and agreements.

European Economic Area Restrictions In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, “Relevant Member State”), an offer of the Equity Shares to the public may not be made in that Relevant Member State prior to the publication of a prospectus in relation to the Rights Entitlement or the Equity Shares which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except that an offer of Equity Shares or Rights Entitlement to the public in that Relevant Member State from and including the Relevant Implementation Date may be made: (a) to legal entities which are authorised or regulated to operate in the financial markets or, if not so authorised

or regulated, whose corporate purpose is solely to invest in securities;

(b) to any legal entity which has two or more of (1) an average of at least 250 employees during the last Financial Year; (2) a total balance sheet of more than Euro 43,000,000 and (3) an annual net turnover of more than Euro 50,000,000, as shown in its last annual or consolidated accounts; or

(c) in any other circumstances falling within Article 3(2) of the Prospectus Directive; provided that no such offer of Equity Shares shall result in the requirement for the publication by our Company or the Lead Manager pursuant to Article 3 of the Prospectus Directive. For the purposes of this provision, the expression an “offer to the public” in relation to any Equity Shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Equity Shares to be offered so as to enable an investor to decide to purchase or subscribe the Equity Shares, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression “Prospectus Directive” means Directive 2003/7 1/EC and includes any relevant implementing measure in each Relevant Member State. In the case of any Rights Entitlement or Equity Shares being offered to a financial intermediary as that term is used in Article 3(2) of the Prospectus Directive, such financial intermediary will be deemed to have represented, acknowledged and agreed that the Rights Entitlement or Equity Shares acquired by them in the Issue have not been acquired on a non-discretionary basis on behalf of, nor have they been acquired with a view to their offer or resale to, persons in circumstances which may give rise to an offer of any Rights Entitlement or Equity Shares acquired by them in the Issue to the public other than their offer or resale in a Relevant Member State to qualified investors as so defined who are not financial intermediaries or in circumstances in which the prior consent of the Lead Manager has been obtained to each such proposed offer or resale.

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United Kingdom Restrictions This Draft Letter of Offer is only being distributed to and is only directed at (i) persons who are outside the UK, or (ii) in circumstances where Section 21(1) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 does not apply. Filing This Draft Letter of Offer has been filed with the Corporation Finance Department of the SEBI, located at SEBI Bhavan, C-4-A, G Block, Bandra-Kurla Complex, Bandra (East), Mumbai 400 051, India for its observations. After SEBI gives its observations, the final Letter of Offer will be filed with the Designated Stock Exchange as per the provisions of the Companies Act. Listing Our Company will issue and dispatch Allotment advice/ share certificates/demat credit and/or letters of regret along with refund order or credit the Allotted Equity Shares to the respective beneficiary accounts, if any, within a period of 15 days from the Issue Closing Date. If such money is not repaid within eight days from the day our Company becomes liable to repay it, (i.e. 15 days after the Issue Closing Date or the date of the refusal by the Stock Exchange(s), whichever is earlier) our Company and every Director of our Company who is an officer in default shall, on and from expiry of eight days, be jointly and severally liable to pay the money with interest as prescribed under Section 73 of the Companies Act. Consents Consents in writing of our Directors, the Auditors, the Lead Manager, the Legal Counsel, the Registrar to the Issue, and the Bankers to the Issue, lenders and experts to act in their respective capacities have been obtained and such consents have not been withdrawn up to the date of this Draft Letter of Offer. B S R & Co. and Chaturvedi & Shah, Chartered Accountants, the Auditors of our Company, have given their written consent for the inclusion of their report in the form and content in which it appears in this Draft Letter of Offer and such consent and report have not been withdrawn up to the date of this Draft Letter of Offer. Jitendra Sanghavi & Co., Chartered Accountants have given their written consent for the inclusion of the statement of tax benefits dated July 25, 2012 in the form and content in which it appears in this Draft Letter of Offer. Expert Opinion Except for the report on the statement of tax benefits dated July 25, 2012 received from Jitendra Sanghavi & Co., Chartered Accountants, in the form and context in which it appears in this Draft Letter of Offer, we have not obtained any other expert opinion in relation to this issue. Issue related expenses The Issue related expenses include, among others, fees to various advisors, printing and distribution expenses, advertisement expenses, and registrar and depository fees. The estimated Issue related expenses are as follows:

Activity Expense (` in

lakhs)

Expense (% of total expenses)

Expense (% of Issue Size)

Lead Manager [●] [●] [●] Registrars to the Issue [●] [●] [●] Monitoring Agency, Legal Advisors and Bankers to the Issue

[●] [●] [●]

SCSB Commission [●] [●] [●] Others (SEBI Fees, Stock Exchange Fees, Printing, Stationery and Postage, Advertisement, etc)

[●] [●] [●]

563

Activity Expense (` in

lakhs)

Expense (% of total expenses)

Expense (% of Issue Size)

Total estimated Issue expenses [●] [●] [●] Previous Issues by our Company Our Company has not undertaken any public or rights issue during the last five years. Our Company had filed a draft letter of offer dated September 27, 2011 with SEBI. The in-principal approval from BSE was received on October 17, 2011. However, SEBI, vide its letter dated October 7, 2011 informed our Company that it would not process the said draft letter of offer since it was not signed by one of our directors. Previous issues of Equity Shares otherwise than for cash Except as disclosed in the chapter entitled “Capital Structure” at page 69, our Company has not issued any Equity Shares for consideration otherwise than for cash. Commission and Brokerage paid on previous issues of the Equity Shares Our Company had undertaken an initial public offer in Fiscal 2001. The commission and brokerage paid in relation to the initial public offer was `191.09 lakhs. Previous capital issue during the previous three years by listed Subsidiaries, Group Companies and associates of our Company Except as disclosed in this Draft Letter of Offer, none of our Subsidiaries, Group Companies and associates of our Company are listed on any stock exchange. Reliance Broadcast Network Limited, a listed Group Company, has not made any public or rights issue in the last three years. Performance vis-à-vis objects – Public / Rights Issue of our Company and/or listed Subsidiaries, Group Companies and associates of our Company Our Company has not undertaken any public or rights issue during the last 10 years immediately preceding the date of this Draft Letter of Offer. Except as disclosed in this Draft Letter of Offer, none of our Group Companies, our Subsidiaries and associates of our Company are listed on any stock exchange. Reliance Broadcast Network Limited has not made any public or rights issue in the last ten years. Outstanding Debentures/Bonds and Preference Shares Our Company has issued:

3,500 11.00% secured redeemable non-convertible debentures of `10,00,000 each which are currently outstanding;

440 12.50% unsecured redeemable non-convertible debentures of `10,00,000 each which are currently outstanding; and

29,50,000 10.00% redeemable non-convertible preference shares of `5 each which are currently outstanding.

Option to Subscribe

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Other than as disclosed in the chapter entitled “Capital Structure” at page 69, our Company has not given any person any option to subscribe for the Equity Shares. Investor Grievances and Redressal System Our Company has adequate arrangements for the redressal of investor complaints in compliance with the corporate governance requirements under the Listing Agreements. The Shareholders and Investors’ Grievance Committee currently comprises Gautam Doshi, Amit Khanna and Prasoon Joshi and its broad terms of reference include investigation into any matter relating to redressing shareholders’ and/or investors’ complaints pertaining to transfer of shares, non-receipt of balance sheet, non-receipt of declared dividend, duplicate share certificates and dematerialization or rematerialization of shares. Status of Complaints (a) Total number of complaints received during Fiscal 2010: 19 (b) Total number of complaints received during Fiscal 2011: 37 (c) Total number of complaints received during the 12 months ended March 31, 2012: 25

(d) Time normally taken for disposal of various types of investor complaints: Not more than five days . Status of outstanding investor complaints in relation to our Company As of date of this Draft Letter of Offer, there were no outstanding investor complaints. Status of outstanding investor complaints in relation to the listed Group Companies In relation to the Reliance Broadcast Network Limited, as of date of this Draft Letter of Offer, there were no outstanding investor complaints. Investor Grievances arising out of the Issue Our Company’s investor grievances arising out of the Issue will be handled by Link Intime India Private Limited, who is the Registrar to the Issue. The Registrar will have a separate team of personnel handling only post-Issue correspondence. The agreement between our Company and the Registrar will provide for retention of records with the Registrar for a period of at least one year from the last date of dispatch of Allotment Advice/ share certificate / demat credit / refund order to enable the Registrar to redress grievances of Investors. All grievances relating to the Issue may be addressed to the Registrar to the Issue or the SCSB in case of ASBA applicants giving full details such as folio no., name and address, contact telephone / cell numbers, email i.d. of the first applicant, number and type of shares applied for, Application Form serial number, amount paid on application and the name of the bank and the branch where the application was deposited, along with a photocopy of the acknowledgement slip. In case of renunciation, the same details of the Renouncee should be furnished. The average time taken by the Registrar for attending to routine grievances will be 7-10 days from the date of receipt of complaints. In case of non-routine grievances where verification at other agencies is involved, it would be the endeavour of the Registrar to attend to them as expeditiously as possible. Our Company undertakes to resolve the Investor grievances in a time bound manner. Registrar to the Issue

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Link Intime India Private Limited C 13, Pannalal Silk Mills Compound LBS Marg, Bhandup (West) Mumbai 400 078 Telephone: +91 22 2596 7878 Toll-free: 1-800-22-0878 Facsimile: +91 22 2596 0329 E-mail: rml.rights@linkintime.co.in Investor Grievance Email: rml.rights@linkintime.co.in Website: www.linkintime.co.in Contact Person: Pravin Kasare SEBI Registration No.: INR 0000 04058 Investors may contact the Compliance Officer in case of any pre-Issue / post -Issue related problems such as non-receipt of Allotment advice/share certificates/ demat credit / refund orders etc. The contact details of the Compliance Officer are as follows: Ashish Agarwal Reliance MediaWorks Limited Film City Complex Goregaon (East) Mumbai 400 065 Maharashtra, India Tel: +91 22 3980 8900 Facsimile: +91 22 3980 8985 Email: investor.complaints@relianceada.com Changes in Auditors during the last three years Chaturvedi & Shah, Chartered Accountants were appointed as one of joint auditors on September 30, 2009. Capitalization of Reserves or Profits Other than as disclosed in the chapter entitled “Capital Structure” of this Draft Letter of Offer, our Company has not capitalized any of its reserves or profits in the last five years. Revaluation of Fixed Assets Except as stated in the chapter entitiled “Financial Statements” at page 188,there has been no revaluation of our Company’s fixed assets in the last five years. Minimum Subscription If our Company does not receive the minimum subscription of 90% of the Issue, or the subscription level falls below 90%, after the Issue Closing Date on account of cheques being returned unpaid or withdrawal of applications, our Company shall refund the entire subscription amount received within 15 days from the Issue Closing Date. If there is delay in the refund of the subscription amount by more than eight days after our Company becomes liable to pay the subscription amount (i.e., 15 days after the Issue Closing Date), our Company and every Director of our Company who is an officer in default shall be jointly and severally liable to pay interest for the delayed period, as prescribed under sub-sections (2) and (2A) of Section 73 of the Companies Act.

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SECTION VII: ISSUE INFORMATION

TERMS OF THE ISSUE

The Equity Shares proposed to be issued on a rights basis, are subject to the terms and conditions contained in this Draft Letter of Offer, the enclosed CAF, the Memorandum of Association and Articles of Association of our Company, and the provisions of the Companies Act, FEMA, the guidelines and regulations issued by SEBI, the guidelines, notifications and regulations for the issue of capital and for listing of securities issued by GoI and other statutory and regulatory authorities from time to time, terms and conditions as stipulated in the allotment advice or security certificate. Please note that QIB applicants and other applicants whose application amount exceeds `2,00,000 can participate in the Issue only through the ASBA process. Equity Shareholders of our Company who are not QIBs and whose application amount is not more than `2,00,000 can participate in the Issue through the ASBA process as well as the non ASBA process. ASBA Investors should note that the ASBA process involves application procedures that may be different from the procedure applicable to non ASBA process. ASBA Investors should carefully read the provisions applicable to such applications before making their application through the ASBA process. For details, please see parts entitled “Procedure for Application through the Applications Supported by Blocked Amount (“ASBA”) Process” in this chapter. Basis for the issue The Equity Shares are being offered for subscription for cash to the existing Equity Shareholders whose names appear as beneficial owners as per the list to be furnished by the Depositories in respect of the Equity Shares held in the electronic form and on the register of members of our Company in respect of the Equity Shares held in physical form at the close of business hours on the Record Date, fixed in consultation with the Stock Exchanges. Rights Entitlement As your name appears as a beneficial owner in respect of the Equity Shares held in the electronic form or appears in the register of members as an Equity Shareholder of our Company as on the Record Date, i.e., [●], you are entitled to the number of Equity Shares as set out in Part A of the enclosed CAF. The distribution of the Letter of Offer and the issue of Equity Shares on a rights basis to persons in certain jurisdictions outside India may be restricted by legal requirements prevailing in those jurisdictions. Our Company is making the issue of Equity Shares on a rights basis to the Equity Shareholders and the Letter of Offer, Abridged Letter of Offer and the CAFs will be dispatched only to those Equity Shareholders who have a registered address in India. Any person who acquires Rights Entitlements or Equity Shares will be deemed to have declared, warranted and agreed, by accepting the delivery of the Letter of Offer, that it is not and that at the time of subscribing for the Equity Shares or the Rights Entitlements, it will not be, in the United States. PRINCIPAL TERMS OF THE EQUITY SHARES Face Value Each Equity Share will have the face value of `5/-. Issue Price Each Equity Share shall be offered at an Issue Price of ` [●] for cash at a premium of ` [●] per Equity Share. The Issue Price has been arrived at after consultation between our Company and the Lead Manager.

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Rights Entitlement Ratio The Equity Shares are being offered on a rights basis to the Equity Shareholders in the ratio of [●] Equity Shares for every [●] Equity Shares held on the Record Date. Terms of Payment The full amount of `[●] per Equity Share is payable on application. Reliance Capital Limited through its letter dated July 26, 2012 has consented to adjust the RCL Loan towards share application money against their Rights Entitlements and additional subscription, if any. Consequently no fresh Issue proceeds would be received by our Company to such an extent. Fractional Entitlements For Equity Shares being offered on a rights basis under this Issue, if the shareholding of any of the Equity Shareholders is less than [●] Equity Shares or not in the multiple of [●], the fractional entitlement of such Equity Shareholders shall be ignored. Equity Shareholders whose fractional Rights Entitlements are being ignored would be given preferential consideration for the Allotment of one additional Equity Share each if they apply for additional Equity Shares over and above their rights entitlement, if any. For example, if an Equity Shareholder holds between [●] and [●] Equity Shares, he will be entitled to [●] Equity Shares on a rights basis. He will also be given a preferential consideration for the Allotment of one additional Equity Share if he has applied for the same. Those Equity Shareholders holding less than [●] Equity Shares will therefore be entitled to zero Equity Shares under this Issue and shall be despatched a CAF with zero entitlement. Such Equity Shareholders are entitled to apply for additional Equity Shares. However, they cannot renounce the same in favour of third parties. CAFs with zero entitlement will be non-negotiable / non-renounceable. For example, if an Equity Shareholder holds between one and [●] Equity Shares, he will be entitled to zero Equity Shares on a rights basis. He will be given a preference for Allotment of [●] additional Equity Share if he has applied for the same. Ranking The Equity Shares being issued shall be subject to the provisions of our Memorandum of Association and Articles of Association. The Equity Shares allotted in the Issue shall rank pari passu with our existing Equity Shares. Listing and trading of Equity Shares proposed to be issued Our Company’s existing Equity Shares are currently listed and traded on the Stock Exchanges under the ISIN INE540B01015. The fully paid up Equity Shares proposed to be issued on a rights basis shall be listed and admitted for trading on the Stock Exchanges under the existing ISIN for fully paid up Equity Shares of our Company. The listing and trading of the Equity Shares shall be based on the current regulatory framework applicable thereto. Accordingly, any change in the regulatory regime would affect the listing and trading schedule. The Equity Shares allotted pursuant to this Issue will be listed as soon as practicable and all steps for completion of the necessary formalities for listing and commencement of trading shall be taken within seven Working Days of finalisation of the basis of allotment. Our Company has made an application for “in-principle” approval for listing of the Equity Shares to the BSE and the NSE through letters dated [●] and [●], respectively and has received such approval from the BSE pursuant to the letter no. [●] dated [●] and from the NSE pursuant to letter no. [●] dated [●].

568

Rights of the Equity Shareholder Subject to applicable laws, the Equity Shareholders of our Company shall have the following rights: Right to receive dividend, if declared; Right to attend general meetings and exercise voting powers, unless prohibited by law; Right to vote in person or by proxy; Right to receive offers for rights shares and be allotted bonus shares, if announced; Right to receive surplus on liquidation; Right to free transferability of Equity Shares; and Such other rights as may be available to a shareholder of a listed public company under the Companies Act

and Memorandum of Association and Articles of Association. General Terms of the Issue Market Lot The Equity Shares of our Company are tradable only in dematerialized form. The market lot for Equity Shares in dematerialised mode is one. In case an Equity Shareholder holds Equity Shares in physical form, our Company would issue to the allottees one certificate for the Equity Shares allotted to each folio (“Consolidated Certificate”). Joint Holders Where two or more persons are registered as the holders of any Equity Shares, they shall be deemed to hold the same as joint tenants with the benefit of survivorship subject to the provisions contained in the Articles of Association. Nomination Nomination facility is available in respect of the Equity Shares in accordance with the provisions of the Section 109A of the Companies Act. An Equity Shareholder can nominate any person by filling the relevant details in the CAF in the space provided for this purpose. A sole Equity Shareholder or first Equity Shareholder, along with other joint Equity Shareholders being individual(s) may nominate any person(s) who, in the event of the death of the sole holder or all the joint holders, as the case may be, shall become entitled to the Equity Shares. A person, being a nominee, becoming entitled to the Equity Shares by reason of the death of the original Equity Shareholder(s), shall be entitled to the same advantages to which he would be entitled if he were the registered holder of the Equity Shares. Where the nominee is a minor, the Equity Shareholder(s) may also make a nomination to appoint, in the prescribed manner, any person to become entitled to the Equity Share(s), in the event of death of the said holder, during the minority of the nominee. A nomination shall stand rescinded upon the sale of the Equity Share by the person nominating. A transferee will be entitled to make a fresh nomination in the manner prescribed. When the Equity Share is held by two or more persons, the nominee shall become entitled to receive the amount only on the demise of all the holders. Fresh nominations can be made only in the prescribed form available on request at the registered office of the Company or such other person at such addresses as may be notified by the Company. The Applicant can make the nomination by filling in the relevant portion of the CAF. Only one nomination would be applicable for one folio. Hence, in case the Investor(s) has already registered the nomination with our Company, no further nomination needs to be made for Equity Shares that may be allotted in this Issue under the same folio. In case the allotment of Equity Shares is in dematerialised form, there is no need to make a separate nomination for the Equity Shares to be allotted in this Issue. Nominations registered with respective Depositary Participant (“DP”) of the Investor would prevail. Any Investor desirous of changing the existing nomination is requested to inform its respective DP.

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Notices All notices to the Equity Shareholder(s) required to be given by our Company shall be published in one English language national daily newspaper, one Hindi language national daily newspaper and one regional language daily newspaper with wide circulation in Maharashtra and / or, will be sent by post to the registered address of the Equity Shareholders in India or the Indian address provided by the Equity Shareholders from time to time. Additional Subscription by our Promoters Our Promoters have, through the Subscription Letter, jointly and severally, undertaken to (i) apply for Equity Shares being offered to them pursuant to the Issue to the extent of their Rights Entitlement; (ii) apply directly or through our Company’s Promoter Group for any Equity Shares renounced in their favour; and (iii) apply directly or through the Company’s Promoter Group for any additional Equity Shares in the Rights Issue only to the extent of any unsubscribed portion of the Rights Issue, subject to applicable law, to ensure that at least 90% of the Rights Issue is subscribed.

As a result of the subscription to any unsubscribed portion and consequent allotment of Equity Shares in accordance with the paragraph above, the Promoters may acquire Equity Shares over and above their Rights Entitlement which may result in an increase in their shareholding, individually and / or collectively, above their current shareholding. Any such subscription and acquisition of Equity Shares by the Promoters in the Rights Issue will not result in change of control of the management of the Company in accordance with Regulation 3 (2) of the Takeover Regulations and shall be exempt in terms of Regulation 10 (4) (b) of the Takeover Code. Further, such subscription to additional Equity Shares by the Promoters beyond their Rights Entitlement will be in accordance with the provisions of Regulation 10(4) (b) of the Takeover Regulations. As such, other than meeting the requirements indicated in the chapter entitled “Objects of the Issue” at page 82, there is no other intention / purpose for the Issue, including any intention to delist our Equity Shares, even if, as a result of any Allotment in the Issue to our Promoter(s) and / or the members of our Promoter Group, the shareholding of our Promoters and/or Promoter Group in our Company exceeds their current shareholding. However, such participation will not result in breach of minimum public shareholding requirement stipulated in the equity Listing Agreement entered into between us and the Stock Exchanges. For details, please see the part entitled “Basis of Allotment” at page 582. Procedure for Application The CAF for Equity Shares would be printed in black ink for all Equity Shareholders. In case the original CAFs are not received by the Equity Shareholder or is misplaced by the Equity Shareholder, the Equity Shareholder may request the Registrar to the Issue, for issue of a duplicate CAF, by furnishing the registered folio number, DP ID, Client ID and their full name and address. In case the signature of the Investor(s) does not match with the specimen registered with our Company, the application is liable to be rejected. Please note that neither our Company nor the Registrar to the Issue shall be responsible for delay in the receipt of the CAF/duplicate CAF attributable to postal delays or if the CAF/duplicate CAF are misplaced in the transit. Please note that QIB applicants and other applicants whose application amount exceeds `2,00,000 can participate in the Issue only through the ASBA process. Equity Shareholders of our Company who are not QIBs and whose application amount is not more than `2,00,000 can participate in the Issue through the ASBA process as well as the non-ASBA process. Acceptance of the Issue You may accept the offer to participate and apply for the Equity Shares offered, either in full or in part, by filling Part A of the enclosed CAFs and submit the same along with the application money payable to the Bankers to the

570

Issue or any of the collection branches as mentioned on the reverse of the CAFs before the close of the banking hours on or before the Issue Closing Date or such extended time as may be specified by our Board of Directors in this regard. Investors at centres not covered by the branches of collecting banks can send their CAFs together with the cheque drawn at par on a local bank at Mumbai/demand draft payable at Mumbai to the Registrar to the Issue by registered post. Such applications sent to anyone other than the Registrar to the Issue are liable to be rejected. For further details on the mode of payment, please see the parts entitled “Mode of Payment for Resident Equity Shareholders/Investors” and “Mode of Payment for Non-Resident Equity Shareholders/Investors” at pages 574 and 574, respectively. Option available to the Equity Shareholders The CAFs will clearly indicate the number of Equity Shares that the Shareholder is entitled to. If the Equity Shareholder applies for an investment in Equity Shares, then he can: Apply for his Rights Entitlement of Equity Shares in full; Apply for his Rights Entitlement of Equity Shares in part; Apply for his Rights Entitlement of Equity Shares in part and renounce the other part of the Equity Shares; Apply for his Rights Entitlement in full and apply for additional Equity Shares; Renounce his Rights Entitlement in full.

Additional Equity Shares You are eligible to apply for additional Equity Shares over and above your Rights Entitlement, provided that you are eligible to apply under applicable law and have applied for all the Equity Shares offered without renouncing them in whole or in part in favour of any other person(s). Applications for additional Equity Shares shall be considered and allotment shall be made at the sole discretion of the Board, subject to sectoral caps and in consultation if necessary with the Designated Stock Exchange and in the manner prescribed under the part entitled “Basis of Allotment” at page 582. If you desire to apply for additional Equity Shares, please indicate your requirement in the place provided for additional Equity Shares in Part A of the CAF. The Renouncee applying for all the Equity Shares renounced in their favour may also apply for additional Equity Shares. Where the number of additional Equity Shares applied for exceeds the number available for Allotment, the Allotment would be made on a fair and equitable basis in consultation with the Designated Stock Exchange. Renunciation This Issue includes a right exercisable by you to renounce the Equity Shares offered to you either in full or in part in favour of any other person or persons. Your attention is drawn to the fact that our Company shall not Allot and/or register Equity Shares in favour of more than three persons (including joint holders), partnership firm(s) or their nominee(s), minors, HUF, any trust or society (unless the same is registered under the Societies Registration Act, 1860 or the Indian Trust Act, 1882 or any other applicable law relating to societies or trusts and is authorised under its constitution or bye-laws to hold Equity Shares, as the case may be). Additionally, existing Equity Shareholders shall not renounce in favor of persons or entities in the United States or who would otherwise be prohibited from being offered or subscribing for Equity Shares or Rights Entitlement under applicable securities laws. Any renunciation (i) from resident Indian equity shareholder(s) to non-resident(s), or (ii) from non-resident equity shareholder(s) to resident Indian(s), or (iii) from a non-resident equity shareholder(s) to other non-resident(s), is subject to the renouncer(s)/ renouncee(s) obtaining the necessary regulatory approvals. By virtue of the Circular No. 14 dated September 16, 2003 issued by the RBI, Overseas Corporate Bodies (“OCBs”) have been derecognized as an eligible class of investors and the RBI has subsequently issued the Foreign Exchange Management (Withdrawal of General Permission to Overseas Corporate Bodies (OCBs)) Regulations, 2003.

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Accordingly, the existing Equity Shareholders of our Company who do not wish to subscribe to the Equity Shares being offered but wish to renounce the same in favour of Renouncee shall not renounce the same (whether for consideration or otherwise) in favour of OCB(s). Part ‘A’ of the CAF must not be used by any person(s) other than those in whose favour this offer has been made. If used, this will render the application invalid. Submission of the enclosed CAF to the Banker to the Issue at its collecting branches specified on the reverse of the CAF with the form of renunciation (Part ‘B’ of the CAF) duly filled in shall be conclusive evidence for our Company of the person(s) applying for Equity Shares in Part ‘C’ of the CAF to receive Allotment of such Equity Shares. The Renouncees applying for all the Equity Shares renounced in their favour may also apply for additional Equity Shares. Part ‘A’ of the CAF must not be used by the Renouncee(s) as this will render the application invalid. Renouncee(s) will have no further right to renounce any Equity Shares in favour of any other person. Procedure for renunciation To renounce all the Equity Shares offered to an Equity Shareholder in favour of one Renouncee If you wish to renounce the offer indicated in Part ‘A’, in whole, please complete Part ‘B’ of the CAF. In case of joint holding, all joint holders must sign Part ‘B’ of the CAF. The person in whose favour renunciation has been made should complete and sign Part ‘C’ of the CAF. In case of joint Renouncees, all joint Renouncees must sign this part of the CAF. To renounce in part/or renounce the whole to more than one person(s) If you wish to either accept this offer in part and renounce the balance or renounce the entire offer under this Issue in favour of two or more Renouncees, the CAF must be first split into requisite number of forms. Please indicate your requirement of SAFs in the space provided for this purpose in Part ‘D’ of the CAF and return the entire CAF to the Registrar to the Issue so as to reach them latest by the close of business hours on the last date of receiving requests for SAFs. On receipt of the required number of SAFs from the Registrar, the procedure as mentioned in paragraph above shall have to be followed. In case the signature of the Equity Shareholder(s), who has renounced the Equity Shares, does not match with the specimen registered with our Company, the application is liable to be rejected. Renouncee(s) The person(s) in whose favour the Equity Shares are renounced should fill in and sign Part ‘C’ of the CAF and submit the entire CAF to the Bankers to the Issue on or before the Issue Closing Date along with the application money in full. Change and/or introduction of additional holders If you wish to apply for Equity Shares jointly with any other person(s), not more than three, who is/are not already a joint holder with you, it shall amount to renunciation and the procedure as stated above for renunciation shall have to be followed. Even a change in the sequence of the name of joint holders shall amount to renunciation and the procedure, as stated above shall have to be followed. However, this right of renunciation is subject to the express condition that our Board of Directors of our Company shall be entitled in its absolute discretion to reject the request for Allotment from the Renouncee(s) without assigning any reason therefore. Instructions for Options The summary of options available to the Equity Shareholder is presented below. You may exercise any of the following options with regard to the Equity Shares offered, using the enclosed CAF:

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Option Available Action Required

1. Accept whole or part of your Rights Entitlement without renouncing the balance

Fill in and sign Part A (All joint holders must sign)

2. Accept your Rights Entitlement in full and apply for additional Equity Shares

Fill in and sign Part A including Block III relating to the acceptance of entitlement and Block IV relating to additional Equity Shares (All joint holders must sign)

3. Accept a part of your Rights Entitlement and renounce the balance to one or more Renouncee(s)

OR

Renounce your Rights Entitlement to all the Equity Shares offered to you to more than one Renouncee

Fill in and sign Part D (all joint holders must sign) requesting for SAFs. Send the CAF to the Registrar to the Issue so as to reach them on or before the last date for receiving requests for SAFs. Splitting will be permitted only once On receipt of the SAF take action as indicated below

For the Equity Shares you wish to accept, if any, fill in and sign Part A

For the Equity Shares you wish to renounce, fill in and sign Part B indicating the number of Equity Shares renounced and hand it over to the Renouncee. Each of the Renouncee should fill in and sign Part C for the Equity Shares accepted by them

4. Renounce your Rights Entitlement in full to one person (Joint Renouncees are considered as one)

Fill in and sign Part B (all joint holders must sign) indicating the number of Equity Shares renounced and hand it over to the Renouncee. The Renouncee must fill in and sign Part C (All joint Renouncees must sign)

5. Introduce a joint holder or change the sequence of joint holders

This will be treated as a renunciation. Fill in and sign Part B and the Renouncee must fill in and sign Part C

Please note that: Part ‘A’ of the CAF must not be used by any person(s) other than the Equity Shareholder to whom this

Letter of Offer has been addressed. If used, this will render the application invalid. Request for SAFs should be made for a minimum of one Equity Share or, in either case, in multiples

thereof and one SAF for the balance Equity Shares, if any. Request by the Investor for the SAFs should reach the Registrar on or before [●].

Only the Equity Shareholder to whom this Letter of Offer has been addressed shall be entitled to renounce

and to apply for SAFs. Forms once split cannot be split further. SAFs will be sent to the Investor(s) by post at the applicant’s risk.

Equity Shareholders shall not renounce in favour of persons or entities in the United States or who would

otherwise be prohibited from being offered or subscribing for Equity Shares or Rights Entitlement under applicable securities laws.

Availability of duplicate CAF In case the original CAF is not received, or is misplaced by the Investor, the Registrar to the Issue will issue a duplicate CAF on the request of the Investor who should furnish the registered folio number/ DP and Client ID and

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his/ her full name and address to the Registrar to the Issue. Please note that the request for duplicate CAF should reach the Registrar to the Issue within [●] days from the Issue Opening Date. Please note that those who are making the application in the duplicate form should not utilize the original CAF for any purpose including renunciation, even if it is received/ found subsequently. If the Investor violates such requirements, he / she shall face the risk of rejection of either original CAF or both the applications. Please also note that shareholder has an option to print the duplicate CAF from the website of the Registrar to the Issue (Web site: www.linkintime.co.in) by providing his / her folio. no. / DP ID / Client ID to enable the shareholder to apply for the Issue. Application on Plain Paper An Investor who has neither received the original CAF nor is in a position to obtain the duplicate CAF may make an application to subscribe to the Issue on plain paper, along with Demand Draft, net of bank and postal charges payable at Mumbai and the Investor should send the same by registered post directly to the Registrar to the Issue. Applications on plain paper will not be accepted from any address outside India. The envelope should be super scribed “[●]” and should be postmarked in India. The application on plain paper, duly signed by the Investors including joint holders, in the same order as per specimen recorded with our Company, must reach the office of the Registrar to the Issue before the Issue Closing Date and should contain the following particulars: Name of Issuer, being Reliance MediaWorks Limited; Name and address of the Investor including joint holders; Registered Folio Number/ DP and Client ID; Number of Equity Shares held as on Record Date; Number of Equity Shares entitled to; Number of Equity Shares applied for; Number of additional Equity Shares applied for, if any; Total number of Equity Shares applied for; Total amount paid at the rate of ` [●] per Equity Share; Particulars of cheque/draft; Savings/Current Account Number and name and address of the bank where the Investor will be depositing

the refund order; and Except for applications on behalf of the Central or State Government, the residents of Sikkim and the

officials appointed by the courts, PAN number of the Investor and for each Investor in case of joint names, irrespective of the total value of the Equity Shares applied for pursuant to the Issue.

If the payment is made by a draft purchased from NRE/FCNR/NRO account, as the case may be, an account debit certificate from the bank issuing the draft confirming that the draft has been issued by debiting the NRE/FCNR/NRO account.

Additionally, all applicants shall include the following: “I/We understand that neither the Rights Entitlement nor the Equity Shares have been, and will be, registered under the United States Securities Act of 1933, as amended (“US Securities Act”) or any United States state securities laws, and may not be offered, sold, resold or otherwise transferred within the United States or to the territories or possessions thereof (“United States”). I/we understand the Equity Shares referred to in this application are being offered in India but not in the United States. I/we understand the offering to which this application relates is not, and under no circumstances is to be construed as, an offering of any Equity Shares or Rights Entitlement for sale in the United States, or as a solicitation therein of an offer to buy any of the said Equity Shares or Rights Entitlement in the United States. Accordingly, I/we understand this application should not be forwarded to or transmitted in or to the United States at any time. I/we understand that none of the Company, the Registrar, the Lead Manager or any other person acting on behalf of the Company will accept subscriptions from any person, or the agent of any person, who appears to be, or who the Company, the Registrar, the Lead Manager or any other person acting on behalf of the Company has reason to believe is, a resident of the United States.

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I/We will not offer, sell or otherwise transfer any of the Equity Shares which may be acquired by us in any jurisdiction or under any circumstances in which such offer or sale is not authorised or to any person to whom it is unlawful to make such offer, sale or invitation except under circumstances that will result in compliance with any applicable laws or regulations. We satisfy, and each account for which we are acting satisfies, all suitability standards for investors in investments of the type subscribed for herein imposed by the jurisdiction of our residence. I/We understand and agree that the Rights Entitlement and Equity Shares may not be reoffered, resold, pledged or otherwise transferred except in an offshore transaction in compliance with Regulation S, or otherwise pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act. I/We (i) am/are, and the person, if any, for whose account I/we am/are acquiring such Rights Entitlement and/or the Equity Shares is/are, outside the United States, and (ii) is/are acquiring the Rights Entitlement and/or the Equity Shares in an offshore transaction meeting the requirements of Regulation S. I/We acknowledge that the Company, the Lead Manager, their affiliates and others will rely upon the truth and accuracy of the foregoing representations and agreements.”

Please note that those who are making the application otherwise than on original CAF shall not be entitled to renounce their rights and should not utilize the original CAF for any purpose including renunciation even if it is received subsequently. If the Investor violates such requirements, he/she shall face the risk of rejection of both the applications. Our Company shall refund such application amount to the Investor without any interest thereon. Last date for Application The last date for submission of the duly filled in CAF is [●]. The Board may extend the said date for such period as it may determine from time to time, subject to the Issue Period not exceeding 30 days. If the CAF together with the amount payable is not received by the Banker to the Issue/ Registrar to the Issue on or before the close of banking hours on the aforesaid last date or such date as may be extended by the Board/ Committee of Directors, the invitation to offer contained in the Letter of Offer shall be deemed to have been declined and the Board/ Committee of Directors shall be at liberty to dispose off the Equity Shares hereby offered, as provided under part entitled “Basis of Allotment” at page 582. Modes of Payment Mode of Payment for Resident Equity Shareholders/ Investors All cheques / drafts accompanying the CAF should be drawn in favour of “[●]”, crossed ‘A/c Payee only’

and should be submitted along with the CAF to the Bankers to the Issue/Collecting Bank or to the Registrar to the Issue, as the case may be;

Investors residing at places other than places where the bank collection centres have been opened by our Company for collecting applications, are requested to send their CAFs together with Demand Draft for the full application amount, net of bank and postal charges drawn in favour of “[●]”, crossed ‘A/c Payee only’ and marked “[●]” payable at Mumbai directly to the Registrar to the Issue by registered post so as to reach them on or before the Issue Closing Date. Our Company or the Registrar to the Issue will not be responsible for postal delays or loss of applications in transit, if any.

Mode of Payment for Non-Resident Equity Shareholders/ Investors As regards the application by non-resident Investor, the following conditions shall apply: Individual non-resident applicants who are permitted to subscribe for Equity Shares by applicable local

securities laws can obtain application forms from the following address:

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Link Intime India Private Limited C 13, Pannalal Silk Mills Compound LBS Marg, Bhandup (West) Mumbai 400 078 Tel: +91 22 2596 7878 Toll-free: 1-800-22-0878 Facsimile: +91 22 2596 0329 E-mail: rml.rights@linkintime.co.in Investor Grievance Email: rml.rights@linkintime.co.in Website: www.linkintime.co.in Contact Person: Pravin Kasare SEBI Registration No.: INR 0000 04058

Applications will not be accepted from non-resident Indian in the United States or its territories and possessions, or any other jurisdiction where the offer or sale of the Rights Entitlements and Equity Shares may be restricted by applicable securities laws.

All non-resident investors should draw the cheques/demand drafts in favour of “[●]”, crossed “A/c Payee only” for the full application amount, net of bank and postal charges and which should be submitted along with the CAF to the Bankers to the Issue/Collecting Bank or to the Registrar to the Issue.

Non-resident investors applying from places other than places where the bank collection centres have been opened by our Company for collecting applications, are requested to send their CAFs together with Demand Draft for the full application amount, net of bank and postal charges drawn in favour of “[●]”, crossed ‘A/c Payee only’ and marked “[●]” payable at Mumbai directly to the Registrar to the Issue by registered post so as to reach them on or before the Issue Closing Date. Our Company or the Registrar to the Issue will not be responsible for postal delays or loss of applications in transit, if any.

Payment by non-residents must be made by demand draft payable or drawn at Mumbai / cheque payable

drawn on a bank account maintained at [●] or funds remitted from abroad in any of the following ways:

Application with repatriation benefits

By Indian Rupee drafts purchased from abroad and payable at Mumbai or funds remitted from abroad (submitted along with Foreign Inward Remittance Certificate); or

By cheque / draft drawn on a NRE or FCNR Account maintained in [●]; or

By Rupee draft purchased by debit to NRE / FCNR Account maintained elsewhere in India and

payable in Mumbai; or

FIIs registered with SEBI must remit funds from special non-resident rupee account.

Application without repatriation benefits As far as non-residents holding Equity Shares on non-repatriation basis are concerned, in addition

to the modes specified above, payment may also be made by way of cheque drawn on Non-Resident (Ordinary) Account maintained in [●] or Rupee Draft purchased out of NRO Account maintained elsewhere in India but payable at Mumbai. In such cases, the Allotment of Equity Shares will be on non-repatriation basis.

Applicants should note that where payment is made through drafts purchased from NRE /

FCNR / NRO accounts as the case may be, an account debit certificate from the bank issuing the draft confirming that the draft has been issued by debiting the NRE/ FCNR/ NRO account should be enclosed with the CAF. In the absence of such an account debit certificate,

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the application shall be considered incomplete and is liable to be rejected. An eligible Shareholder whose status has changed from resident to non-resident should open a

new demat account reflecting the changes status. Any application from a demat account which does not reflect the accurate status of the Applicant are liable to be rejected at the sole discretion of our Company and the Lead Managers.

Notes:

In case where repatriation benefit is available, interest, dividend, sales proceeds derived from the investment in Equity Shares can be remitted outside India, subject to tax, as applicable according to the IT Act.

In case Equity Shares are allotted on a non-repatriation basis, the dividend and sale proceeds of the Equity

Shares cannot be remitted outside India. The CAF duly completed together with the amount payable on application must be deposited with the

Collecting Bank indicated on the reverse of the CAFs before the close of banking hours on or before the Issue Closing Date. A separate cheque or bank draft must accompany each CAF.

In case of an application received from non-residents, Allotment, refunds and other distribution, if any, will

be made in accordance with the guidelines/ rules prescribed by RBI / Government of India as applicable at the time of making such Allotment, remittance and subject to necessary approvals.

Procedure for Application through the Applications Supported by Blocked Amount (“ASBA”) Process This section is for the information of the ASBA Investors proposing to subscribe to the Issue through the ASBA Process. Our Company and the Lead Manager are not liable for any amendments or modifications or changes in applicable laws or regulations, which may occur after the date of the Letter of Offer. Investors who are eligible to apply under the ASBA Process are advised to make their independent investigations and to ensure that the CAF is correctly filled up. The list of banks that have been notified by SEBI to act as SCSBs for the ASBA Process is provided on http://www.sebi.gov.in. For details on Designated Branches of SCSBs collecting the CAF, please refer the above mentioned SEBI link. Equity Shareholders who are eligible to apply under the ASBA Process The option of applying for Equity Shares in the Issue through the ASBA Process is only available to the Investors of our Company on the Record Date and who: hold the Equity Shares in dematerialised form as on the Record Date and have applied towards his/her

Rights Entitlements or additional Equity Shares in the Issue in dematerialised form; have not renounced his/her Rights Entitlements in full or in part; are not in the United States and are eligible under applicable securities laws to subscribe for the Rights

Entitlements and Equity Shares in the Issue; and are not a Renouncee.

CAF The Registrar will despatch the CAF to all Equity Shareholders as per their Rights Entitlement on the Record Date for the Issue. Those Investors who wish to apply through the ASBA payment mechanism will have to select for this mechanism in Part A of the CAF and provide necessary details. Investors desiring to use the ASBA Process are required to submit their applications by selecting the ASBA Option in Part A of the CAF only. Application in electronic mode will only be available with such SCSBs who provide such

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facility. The Investor shall submit the CAF to the SCSB for authorising such SCSB to block an amount equivalent to the amount payable on the application in the said bank account maintained with the same SCSB. Acceptance of the Issue You may accept the Issue and apply for the Equity Shares either in full or in part, by filling Part A of the respective CAFs sent by the Registrar, selecting the ASBA process option in Part A of the CAF and submit the same to the SCSB before the close of the banking hours on or before the Issue Closing Date or such extended time as may be specified by our Board of Directors of our Company in this regard. Mode of payment The Investor applying under the ASBA Process agrees to block the entire amount payable on application with the submission of the CAF, by authorizing the SCSB to block an amount, equivalent to the amount payable on application, in a bank account maintained with the SCSB. After verifying that sufficient funds are available in the bank account details of which are provided in the CAF, the SCSB shall block an amount equivalent to the amount payable on application mentioned in the CAF until it receives instructions from the Registrar. Upon receipt of intimation from the Registrar, the SCSBs shall transfer such amount as per the Registrar’s instruction from the bank account with the SCSB mentioned by the Investor in the CAF. This amount will be transferred in terms of the ICDR Regulations, into the separate bank account maintained by our Company as per the provisions of section 73(3) of the Companies Act. The balance amount remaining after the finalisation of the basis of Allotment shall be unblocked by the SCSBs on the basis of the instructions issued in this regard by the Registrar to the Issue and the Lead Manager to the respective SCSB. The Investor applying under the ASBA Process would be required to block the entire amount payable on their application at the time of the submission of the CAF. The SCSB may reject the application at the time of acceptance of CAF if the bank account with the SCSB details of which have been provided by the Investor in the CAF does not have sufficient funds equivalent to the amount payable on application mentioned in the CAF. Subsequent to the acceptance of the application by the SCSB, our Company would have a right to reject the application only on technical grounds. Options available to the Equity Shareholders applying under the ASBA Process The summary of options available to the Investors is presented below. You may exercise any of the following options with regard to the Equity Shares, using the respective CAFs received from Registrar:

Option Available Action Required

1. Accept whole or part of your Rights Entitlement without renouncing the balance.

Fill in and sign Part A of the CAF (All joint holders must sign)

2. Accept your Rights Entitlement in full and apply for additional Equity Shares

Fill in and sign Part A of the CAF including Block III relating to the acceptance of entitlement and Block IV relating to additional Equity Shares (All joint holders must sign)

The Investors applying under the ASBA Process will need to select the ASBA option process in the CAF and provide required necessary details. However, in cases where this option is not selected, but the CAF is tendered to the SCSBs with the relevant details required under the ASBA process option and the SCSBs block the requisite amount, then that CAFs would be treated as if the Investor have selected to apply through the ASBA process option.

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Please note that pursuant to the applicability of the directions issued by SEBI vide its circular bearing number CIR/CFD/DIL/1/2011 dated April 29, 2011, all applicants who are QIBs or are applying in this Issue for Equity Shares for an amount exceeding `2,00,000 shall mandatorily make use of ASBA facility. Additional Equity Shares You are eligible to apply for additional Equity Shares over and above the number of Equity Shares that you are entitled to, provided that you are eligible to apply for Equity Shares under applicable law and you have applied for all the Equity Shares (as the case may be) offered without renouncing them in whole or in part in favour of any other person(s). Applications for additional Equity Shares shall be considered and Allotment shall be made at the sole discretion of the Board, in consultation with the Designated Stock Exchange and in the manner prescribed under “Basis of Allotment” in this chapter at page 582. If you desire to apply for additional Equity Shares, please indicate your requirement in the place provided for additional Equity Shares in Part A of the CAF. Renunciation under the ASBA Process Renouncees cannot participate in the ASBA Process. Application on Plain Paper An Investor who has neither received the original CAF nor is in a position to obtain the duplicate CAF and who is applying under the ASBA Process may make an application to subscribe to the Issue on plain paper, along with Demand Draft, net of bank and postal charges payable at Mumbai which should be drawn in favour of the “[●]” and the Investors should send the same by registered post directly to the SCSB. Applications on plain paper will not be accepted from any address outside India. The envelope should be super scribed “[●]” and should be postmarked in India. The application on plain paper, duly signed by the Investors including joint holders, in the same order as per the specimen recorded with our Company, must reach the office of the SCSB before the Issue Closing Date and should contain the following particulars: Name of Issuer, being Reliance MediaWorks Limited; Name and address of the Investor including joint holders; Registered Folio Number/ DP and Client ID.; Number of Equity Shares held as on Record Date; Number of Equity Shares entitled to; Number of Equity Shares applied for; Number of additional Equity Shares applied for, if any; Total number of Equity Shares applied for; Total amount paid at the rate of ` [●] per Equity Share; Particulars of cheque/draft; and Except for applications on behalf of the Central or State Government, the residents of Sikkim and the

officials appointed by the courts, PAN number of the Investor and for each Investor in case of joint names, irrespective of the total value of the Equity Shares applied for pursuant to the Issue.

Additionally, all applicants shall include the following: “I/We understand that neither the Rights Entitlement nor the Equity Shares have been, and will be, registered under the United States Securities Act of 1933, as amended (“US Securities Act”) or any United States state securities laws, and may not be offered, sold, resold or otherwise transferred within the United States or to the territories or possessions thereof (“United States”). I/we understand the Equity Shares referred to in this application are being offered in India but not in the United States. I/we understand the offering to which this application relates is not, and under no circumstances is to be construed as, an offering of any Equity Shares or Rights Entitlement for sale in the United States, or as a solicitation therein of an offer to buy any of the said Equity Shares or Rights Entitlement in the United States. Accordingly, I/we understand this application should not be forwarded to or transmitted in or

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to the United States at any time. I/we understand that none of the Company, the Registrar, the Lead Manager or any other person acting on behalf of the Company will accept subscriptions from any person, or the agent of any person, who appears to be, or who the Company, the Registrar, the Lead Manager or any other person acting on behalf of the Company has reason to believe is, a resident of the United States. I/We will not offer, sell or otherwise transfer any of the Equity Shares which may be acquired by us in any jurisdiction or under any circumstances in which such offer or sale is not authorised or to any person to whom it is unlawful to make such offer, sale or invitation except under circumstances that will result in compliance with any applicable laws or regulations. We satisfy, and each account for which we are acting satisfies, all suitability standards for investors in investments of the type subscribed for herein imposed by the jurisdiction of our residence. I/We understand and agree that the Rights Entitlement and Equity Shares may not be reoffered, resold, pledged or otherwise transferred except in an offshore transaction in compliance with Regulation S, or otherwise pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act. I/We (i) am/are, and the person, if any, for whose account I/we am/are acquiring such Rights Entitlement and/or the Equity Shares is/are, outside the United States, and (ii) is/are acquiring the Rights Entitlement and/or the Equity Shares in an offshore transaction meeting the requirements of Regulation S. I/We acknowledge that the Company, the Lead Manager, their affiliates and others will rely upon the truth and accuracy of the foregoing representations and agreements.” Option to receive Equity Shares in Dematerialized Form General instructions for Investors applying under the ASBA Process (a) Please read the instructions printed on the respective CAF carefully. (b) Application should be made on the printed CAF only and should be completed in all respects. The CAF

found incomplete with regard to any of the particulars required to be given therein, and / or which are not completed in conformity with the terms of this Letter of Offer are liable to be rejected. The CAF must be filled in English.

(c) The CAF in the ASBA Process should be submitted at a Designated Branch of the SCSB and whose bank

account details are provided in the CAF and not to the Bankers to the Issue / Collecting Banks (assuming that such Collecting Bank is not a SCSB), to our Company or Registrar or Lead Manager to the Issue.

(d) All applicants, and in the case of application in joint names, each of the joint applicants, should mention

his/her PAN number allotted under the Income-Tax Act, 1961, irrespective of the amount of the application. Except for applications on behalf of the Central or State Government, the residents of Sikkim and the officials appointed by the courts, CAFs without PAN will be considered incomplete and are liable to be rejected. With effect from 16 August 2010, the demat accounts for Investors for which PAN details have not been verified shall be “suspended credit” and no allotment and credit of Equity Shares pursuant to the Issue shall be made into the accounts of such Investors.

(e) All payments will be made by blocking the amount in the bank account maintained with the SCSB. Cash

payment is not acceptable. In case payment is affected in contravention of this, the application may be deemed invalid and the application money will be refunded and no interest will be paid thereon.

(f) Signatures should be either in English or Hindi or in any other language specified in the Eighth Schedule to

the Constitution of India. Signatures other than in English or Hindi and thumb impression must be attested by a Notary Public or a Special Executive Magistrate under his/her official seal. The Investors must sign the CAF as per the specimen signature recorded with our Company/or Depositories.

(g) In case of joint holders, all joint holders must sign the relevant part of the CAF in the same order and as per

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the specimen signature(s) recorded with our Company. In case of joint applicants, reference, if any, will be made in the first applicant’s name and all communication will be addressed to the first applicant.

(h) All communication in connection with application for the Equity Shares, including any change in address

of the Investors should be addressed to the Registrar to the Issue prior to the date of Allotment in this Issue quoting the name of the first/sole applicant Investor, folio numbers and CAF number.

(i) Only the person or persons to whom the Equity Shares have been offered and not renouncee(s) shall be

eligible to participate under the ASBA process. (j) Only persons outside the United States and who are eligible to subscribe for Rights Entitlement and Equity

Shares under applicable securities laws are eligible to participate. Please note that pursuant to the applicability of the directions issued by SEBI vide its circular bearing number CIR/CFD/DIL/1/2011 dated April 29, 2011, all applicants who are QIBs or are applying in this Issue for Equity Shares for an amount exceeding `2,00,000 /- shall mandatorily make use of ASBA facility.

Do’s: a. Ensure that the ASBA Process option is selected in part A of the CAF and necessary details are filled in. b. Ensure that you submit your application in physical mode only. Electronic mode is only available with

certain SCSBs and not all SCSBs and you should ensure that your SCSB offers such facility to you. c. Ensure that the details about your Depository Participant and beneficiary account are correct and the

beneficiary account is activated as Equity Shares will be allotted in the dematerialized form only. d. Ensure that the CAFs are submitted at the SCSBs and details of the correct bank account have been

provided in the CAF. e. Ensure that there are sufficient funds (equal to {number of Equity Shares as the case may be applied for}

X {Issue Price of Equity Shares, as the case may be}) available in the bank account maintained with the SCSB mentioned in the CAF before submitting the CAF to the respective Designated Branch of the SCSB.

f. Ensure that you have authorised the SCSB for blocking funds equivalent to the total amount payable on

application mentioned in the CAF, in the bank account maintained with the respective SCSB, of which details are provided in the CAF and have signed the same.

g. Ensure that you receive an acknowledgement from the SCSB for your submission of the CAF in physical

form. h. Except for CAFs submitted on behalf of the Central or State Government and the residents of Sikkim and

the officials appointed by the courts, each applicant should mention their PAN allotted under the I. T. Act. i. Ensure that the name(s) given in the CAF is exactly the same as the name(s) in which the beneficiary

account is held with the Depository Participant. In case the CAF is submitted in joint names, ensure that the beneficiary account is also held in same joint names and such names are in the same sequence in which they appear in the CAF.

j. Ensure that the Demographic Details are updated, true and correct, in all respects. Don’ts: a. Do not apply if you are in the United States or are not eligible to participate in the Issue under the securities

laws applicable to your jurisdiction.

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b. Do not apply on duplicate CAF after you have submitted a CAF to a Designated Branch of the SCSB. c. Do not pay the amount payable on application in cash, by money order or by postal order. d. Do not send your physical CAFs to the Lead Manager to Issue / Registrar / Collecting Banks (assuming

that such Collecting Bank is not a SCSB) / to a branch of the SCSB which is not a Designated Branch of the SCSB / Company; instead submit the same to a Designated Branch of the SCSB only.

e. Do not submit the GIR number instead of the PAN as the application is liable to be rejected on this ground. f. Do not instruct your respective banks to release the funds blocked under the ASBA Process. Grounds for Technical Rejection under the ASBA Process In addition to the grounds listed under the part entitled “Grounds for Technical Rejection” in this chapter at page 588, applications under the ABSA Process are liable to be rejected on the following grounds: a) DP ID and Client ID mentioned in CAF not matching with the DP ID and Client ID records available with

the Registrar.

b) Sending CAF to a Lead Manager / Registrar / Collecting Bank (assuming that such Collecting Bank is not a SCSB) / to a branch of a SCSB which is not a Designated Branch of the SCSB / Company.

c) Renouncee applying under the ASBA Process.

d) Insufficient funds are available with the SCSB for blocking the amount.

e) Funds in the bank account with the SCSB whose details are mentioned in the CAF having been frozen pursuant to regulatory orders.

f) Account holder not signing the CAF or declaration mentioned therein.

g) CAFs that do not include the certification set out in the CAF to the effect that the subscriber does not have a registered address (and is not otherwise located) in the United States and is authorised to acquire the rights and the securities in compliance with all applicable laws and regulations.

h) CAFs which have evidence of being executed in/dispatched from the United States. Depository account and bank details for Investors applying under the ASBA Process IT IS MANDATORY FOR ALL THE INVESTORS APPLYING UNDER THE ASBA PROCESS TO RECEIVE THEIR EQUITY SHARES IN DEMATERIALISED FORM AND TO THE SAME DEPOSITORY ACCOUNT IN WHICH THE EQUITY SHARES ARE HELD BY THE INVESTOR AS ON THE RECORD DATE. ALL INVESTORS APPLYING UNDER THE ASBA PROCESS SHOULD MENTION THEIR DEPOSITORY PARTICIPANT’S NAME, DEPOSITORY PARTICIPANT IDENTIFICATION NUMBER AND BENEFICIARY ACCOUNT NUMBER IN THE CAF. INVESTORS APPLYING UNDER THE ASBA PROCESS MUST ENSURE THAT THE NAME GIVEN IN THE CAF IS EXACTLY THE SAME AS THE NAME IN WHICH THE DEPOSITORY ACCOUNT IS HELD. IN CASE THE CAF IS SUBMITTED IN JOINT NAMES, IT SHOULD BE ENSURED THAT THE DEPOSITORY ACCOUNT IS ALSO HELD IN THE SAME JOINT NAMES AND ARE IN THE SAME SEQUENCE IN WHICH THEY APPEAR IN THE CAF. Investors applying under the ASBA Process should note that on the basis of name of these Investors,

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Depository Participant’s name and identification number and beneficiary account number provided by them in the CAF, the Registrar to the Issue will obtain from the Depository demographic details of these Investors such as address, bank account details for printing on refund orders and occupation (“Demographic Details”). Hence, Investors applying under the ASBA Process should carefully fill in their Depository Account details in the CAF. These Demographic Details would be used for all correspondence with such Investors including mailing of the letters intimating unblock of bank account of the respective Investor. The Demographic Details given by the Investors in the CAF would not be used for any other purposes by the Registrar. Hence, Investors are advised to update their Demographic Details as provided to their Depository Participants. By signing the CAFs, the Investors applying under the ASBA Process would be deemed to have authorised the Depositories to provide, upon request, to the Registrar to the Issue, the required Demographic Details as available on its records. Letters intimating Allotment and unblocking or refund (if any) would be mailed at the address of the Investor applying under the ASBA Process as per the Demographic Details received from the Depositories. Refunds, if any, will be made directly to the bank account linked to the DP ID. Investors applying under the ASBA Process may note that delivery of letters intimating unblocking of bank account may get delayed if the same once sent to the address obtained from the Depositories are returned undelivered. In such an event, the address and other details given by the Investor in the CAF would be used only to ensure dispatch of letters intimating unblocking of bank account. Note that any such delay shall be at the sole risk of the Investors applying under the ASBA Process and none of our Company, the SCSBs or the Lead Manager shall be liable to compensate the Investor applying under the ASBA Process for any losses caused due to any such delay or liable to pay any interest for such delay. In case no corresponding record is available with the Depositories that matches three parameters, (a) names of the Investors (including the order of names of joint holders), (b) the DP ID and (c) the beneficiary account number, then such applications are liable to be rejected. Underwriting The Issue is not underwritten. Issue Schedule Issue Opening Date: [●]

Last date for receiving requests for SAFs: [●]

Issue Closing Date: [●] The Board may however decide to extend the Issue period as it may determine from time to time but not exceeding 30 days from the Issue Opening Date. Basis of Allotment Subject to the provisions contained in the Letter of Offer, the Articles of Association of our Company and the approval of the Designated Stock Exchange, the Board will proceed to Allot the Equity Shares in the following order of priority: (a) Full Allotment to those Investors who have applied for their Rights Entitlement either in full or in part and

also to the Renouncee(s) who has/ have applied for Equity Shares renounced in their favour, in full or in part.

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(b) Allotment pertaining to fractional entitlements in case of any shareholding other than in multiples of [●]. (c) Allotment to the Investors who having applied for all the Equity Shares offered to them as part of the Issue

and have also applied for additional Equity Shares. The Allotment of such additional Equity Shares will be made as far as possible on an equitable basis having due regard to the number of Equity Shares held by them on the Record Date, provided there is an under-subscribed portion after making full Allotment in (a) and (b) above. The Allotment of such Equity Shares will be at the sole discretion of the Board / Committee of Directors in consultation with the Designated Stock Exchange, as a part of the Issue and will not be a preferential Allotment.

(d) Allotment to Renouncees who having applied for all the Equity Shares renounced in their favour, have

applied for additional Equity Shares provided there is surplus available after making full Allotment under (a), (b) and (c) above. The Allotment of such Equity Shares will be at the sole discretion of the Board/Committee of Directors in consultation with the Designated Stock Exchange, as a part of the Issue and not preferential Allotment.

(e) Our Promoters have, through the Subscription Letter, jointly and severally, undertaken to (i) apply for

Equity Shares being offered to them pursuant to the Issue to the extent of their Rights Entitlement; (ii) apply directly or through our Company’s Promoter Group for any Equity Shares renounced in their favour; and (iii) apply directly or through the Company’s Promoter Group for any additional Equity Shares in the Rights Issue only to the extent of any unsubscribed portion of the Rights Issue, subject to applicable law, to ensure that at least 90% of the Rights Issue is subscribed. As a result of the subscription to any unsubscribed portion and consequent allotment of Equity Shares in accordance with the paragraph above, the Promoters may acquire Equity Shares over and above their Rights Entitlement which may result in an increase in their shareholding, individually and / or collectively, above their current shareholding. Any such subscription and acquisition of Equity Shares by the Promoters in the Rights Issue will not result in change of control of the management of the Company in accordance with Regulation 3 (2) of the Takeover Regulations and shall be exempt in terms of Regulation 10 (4) (b) of the Takeover Code. Further, such subscription to additional Equity Shares by the Promoters beyond their Rights Entitlement will be in accordance with the provisions of Regulation 10(4) (b) of the Takeover Regulations. As such, other than meeting the requirements indicated in the chapter entitled “Objects of the Issue” at page 82, there is no other intention / purpose for the Issue, including any intention to delist our Equity Shares, even if, as a result of any Allotment in the Issue to our Promoter(s) and / or the members of our Promoter Group, the shareholding of our Promoters and/or Promoter Group in our Company exceeds their current shareholding. However, such participation will not result in breach of minimum public shareholding requirement stipulated in the equity Listing Agreement entered into between us and the Stock Exchanges.

Allotment Advices / Refund Orders Our Company will issue and dispatch Allotment advice/ share certificates / demat credit and/or letters of regret along with refund order or credit the allotted Equity Shares to the respective beneficiary accounts, if any, within a period of 15 days from the Issue Closing Date. If such money is not repaid within eight days from the day our Company becomes liable to repay it, (i.e. 15 days after the Issue Closing Date or the date of the refusal by the Stock Exchange(s), whichever is earlier) our Company and every Director of our Company who is an officer in default shall, on and from expiry of eight days, be jointly and severally liable to pay the money with interest as prescribed under Section 73 of the Companies Act. Investors residing at centers where clearing houses are managed by the RBI will get refunds through National Electronic Clearing Service (“NECS”) except where Investors have not provided the details required to send electronic refunds. In case of those Investors who have opted to receive their Rights Entitlement in dematerialized form using electronic

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credit under the depository system, advice regarding their credit of the Equity Shares shall be given separately. Investors to whom refunds are made through electronic transfer of funds will be sent a letter through ordinary post intimating them about the mode of credit of refund within 15 days of the Issue Closing Date. In case of those Investors who have opted to receive their Rights Entitlement in physical form and our Company issues letter of allotment, the corresponding share certificates will be kept ready within one month from the date of Allotment thereof or such extended time as may be approved by our Company Law Board under Section 113 of the Companies Act or other applicable provisions, if any. Investors are requested to preserve such letters of allotment, which would be exchanged later for the share certificates. The letter of allotment / refund order would be sent by registered post / speed post to the sole / first Investors registered address. Such refund orders would be payable at par at all places where the applications were originally accepted. The same would be marked ‘Account Payee only’ and would be drawn in favour of the sole/first Investor. Adequate funds would be made available to the Registrar to the Issue for this purpose. The letter of allotment / Intimations would be sent by ordinary post. Payment of Refund Mode of making refunds The payment of refund, if any, would be done through any of the following modes: 1. NECS – Payment of refund would be done through NECS for Investors having an account at any of the

centres where such facility has been made available. This mode of payment of refunds would be subject to availability of complete bank account details including the MICR code as appearing on a cheque leaf, from the Depositories/the records of the Registrar. The payment of refunds is mandatory for Investors having a bank account at any centre where NECS facility has been made available (subject to availability of all information for crediting the refund through NECS).

2. NEFT – Payment of refund shall be undertaken through NEFT wherever the Investors’ bank has been

assigned the Indian Financial System Code (IFSC), which can be linked to a MICR, allotted to that particular bank branch. IFSC Code will be obtained from the website of RBI as on a date immediately prior to the date of payment of refund, duly mapped with MICR numbers. Wherever the Investors have registered their nine digit MICR number and their bank account number with the registrar to our Company or with the depository participant while opening and operating the demat account, the same will be duly mapped with the IFSC Code of that particular bank branch and the payment of refund will be made to the Investors through this method.

3. Direct Credit – Investors having bank accounts with the Bankers to the Issue shall be eligible to receive

refunds through direct credit. Charges, if any, levied by the relevant bank(s) for the same would be borne by our Company.

4. RTGS – If the refund amount exceeds `2 lakhs, the investors have the option to receive refund through

RTGS. Such eligible Investors who indicate their preference to receive refund through RTGS are required to provide the IFSC code in the CAF. In the event the same is not provided, refund shall be made through ECS or any other eligible mode. Charges, if any, levied by the refund bank(s) for the same would be borne by our Company. Charges, if any, levied by the Investor’s bank receiving the credit would be borne by the Investor.

5. For all other Investors the refund orders will be despatched through Speed Post/ Registered Post. Such

refunds will be made by cheques, pay orders or demand drafts drawn in favour of the sole/first Investor and payable at par.

6. Credit of refunds to Investors in any other electronic manner permissible under the banking laws which is

in force, and is permitted by the SEBI from time to time.

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Printing of Bank Particulars on Refund Orders As a matter of precaution against possible fraudulent encashment of refund orders due to loss or misplacement, the particulars of the Investor’s bank account are mandatorily required to be given for printing on the refund orders. Bank account particulars, where available, will be printed on the refund orders/refund warrants which can then be deposited only in the account specified. Our Company will in no way be responsible if any loss occurs through these instruments falling into improper hands either through forgery or fraud. Allotment advice / Share Certificates/ Demat Credit Allotment advice/ demat credit or letters of regret will be dispatched to the registered address of the first named Investor or respective beneficiary accounts within 15 days, from the Issue Closing Date. In case our Company issues Allotment advice, the relative share certificates will be dispatched within one month from the date of the Allotment. Allottees are requested to preserve such allotment advice (if any) to be exchanged later for share certificates. Option to receive Equity Shares in Dematerialized Form Investors shall be allotted the Equity Shares in dematerialized (electronic) form at the option of the Investor. Our Company has signed a tripartite agreement with NSDL on October 31, 2000 which enables the Investors to hold and trade in Equity Shares in a dematerialized form, instead of holding the Equity Shares in the form of physical certificates. Our Company has also signed a tripartite agreement with CDSL on September 14, 2000 which enables the Investors to hold and trade in Equity Shares in a dematerialized form, instead of holding the Equity Shares in the form of physical certificates. In this Issue, the allottees who have opted for Equity Shares in dematerialized form will receive their Equity Shares in the form of an electronic credit to their beneficiary account as given in the CAF, after verification with a depository participant. Investor will have to give the relevant particulars for this purpose in the appropriate place in the CAF. Allotment advice, refund order (if any) would be sent directly to the Investor by the Registrar to the Issue but the Investor’s depository participant will provide to him the confirmation of the credit of such Equity Shares to the Investor’s depository account. CAFs, which do not accurately contain this information, will be given the Equity Shares in physical form. No separate CAFs for Equity Shares in physical and /or dematerialized form should be made. If such CAFs are made, the CAFs for physical Equity Shares will be treated as multiple CAFs and is liable to be rejected. In case of partial Allotment, Allotment will be done in demat option for the Equity Shares sought in demat and balance, if any, will be allotted in physical Equity Shares. INVESTORS MAY PLEASE NOTE THAT THE EQUITY SHARES OF OUR COMPANY CAN BE TRADED ON THE STOCK EXCHANGES ONLY IN DEMATERIALIZED FORM. The procedure for availing the facility for Allotment of Equity Shares in this Issue in the electronic form is as under: Open a beneficiary account with any depository participant (care should be taken that the beneficiary

account should carry the name of the holder in the same manner as is registered in the records of our Company. In the case of joint holding, the beneficiary account should be opened carrying the names of the holders in the same order as registered in the records of our Company). In case of Investors having various folios in our Company with different joint holders, the Investors will have to open separate accounts for such holdings. Those Investors who have already opened such beneficiary account(s) need not adhere to this step.

For Equity Shareholders already holding Equity Shares of our Company in dematerialized form as on the

Record Date, the beneficial account number shall be printed on the CAF. For those who open accounts later or those who change their accounts and wish to receive their Equity Shares pursuant to this Issue by way of credit to such account, the necessary details of their beneficiary account should be filled in the space provided in the CAF. It may be noted that the Allotment of Equity Shares arising out of this Issue may be made in dematerialized form even if the original Equity Shares of our Company are not dematerialized.

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Nonetheless, it should be ensured that the depository account is in the name(s) of the Investors and the names are in the same order as in the records of our Company.

The responsibility for correctness of information (including Investor’s age and other details) filled in the CAF vis-à-vis such information with the Investor’s depository participant, would rest with the Investor. Investors should ensure that the names of the Investors and the order in which they appear in CAF should be the same as registered with the Investor’s depository participant.

If incomplete / incorrect beneficiary account details are given in the CAF, the Investor will get Equity Shares in physical form.

The Equity Shares allotted to applicants opting for issue in dematerialized form, would be directly credited to the beneficiary account as given in the CAF after verification. Allotment advice, refund order (if any) would be sent directly to the applicant by the Registrar to the Issue but the applicant’s depository participant will provide to him the confirmation of the credit of such Equity Shares to the applicant’s depository account.

Renouncees will also have to provide the necessary details about their beneficiary account for Allotment of Equity Shares in this Issue. In case these details are incomplete or incorrect, the application is liable to be rejected.

General instructions for Investors (a) Please read the instructions printed on the enclosed CAF carefully. (b) Application should be made on the printed CAF, provided by our Company except as mentioned under the

head “Application on Plain Paper” in this section at page 578 and should be completed in all respects. The CAF found incomplete with regard to any of the particulars required to be given therein, and/ or which are not completed in conformity with the terms of the Letter of Offer are liable to be rejected and the money paid, if any, in respect thereof will be refunded without interest and after deduction of bank commission and other charges, if any. The CAF must be filled in English and the names of all the Investors, details of occupation, address, father’s / husband’s name must be filled in block letters.

The CAF together with the cheque / demand draft should be sent to the Bankers to the Issue/Collecting Bank or to the Registrar to the Issue and not to our Company or Lead Manager to the Issue. Investors residing at places other than cities where the branches of the Bankers to the Issue have been authorised by our Company for collecting applications, will have to make payment by Demand Draft payable at Mumbai of an amount net of bank and postal charges and send their CAFs to the Registrar to the Issue by registered post. If any portion of the CAF is / are detached or separated, such application is liable to be rejected. Applications where separate cheques/demand drafts are not attached for amounts to be paid for Equity Shares are liable to be rejected.

(c) Except for applications on behalf of the Central and State Government, the residents of Sikkim and the officials appointed by the courts, all Investors, and in the case of application in joint names, each of the joint Investors, should mention his / her PAN number allotted under the I.T. Act, 1961, irrespective of the amount of the application. CAFs without PAN will be considered incomplete and are liable to be rejected.

(d) Investors are advised that it is mandatory to provide information as to their savings / current account number and the name of the bank with whom such account is held in the CAF to enable the Registrar to the Issue to print the said details in the refund orders, if any, after the names of the payees. Application not containing such details is liable to be rejected.

(e) All payment should be made by cheque/demand draft only. Application through the ASBA process as

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mentioned above is acceptable. Cash payment is not acceptable. In case payment is effected in contravention of this, the application may be deemed invalid and the application money will be refunded and no interest will be paid thereon.

(f) Signatures should be either in English or Hindi or in any other language specified in the Eighth Schedule to

the Constitution of India. Signatures other than in English or Hindi and thumb impression must be attested by a Notary Public or a Special Executive Magistrate under his / her official seal. The Investors must sign the CAF as per the specimen signature recorded with our Company.

(g) In case of an application under power of attorney or by a body corporate or by a society, a certified true

copy of the relevant power of attorney or relevant resolution or authority to the signatory to make the relevant investment under this Issue and to sign the application and a copy of the Memorandum and Articles of Association and / or bye laws of such body corporate or society must be lodged with the Registrar to the Issue giving reference of the serial number of the CAF. In case the above referred documents are already registered with our Company, the same need not be a furnished again. In case these papers are sent to any other entity besides the Registrar to the Issue or are sent after the Issue Closing Date, then the application is liable to be rejected. In no case should these papers be attached to the application submitted to the Bankers to the Issue.

(h) In case of joint holders, all joint holders must sign the relevant part of the CAF in the same order and as per

the specimen signature(s) recorded with our Company. Further, in case of joint Investors who are Renouncees, the number of Investors should not exceed three. In case of joint Investors, reference, if any, will be made in the first Investor’s name and all communication will be addressed to the first Investor.

(i) Application(s) received from NRs/NRIs, or persons of Indian origin residing abroad for Allotment of Equity Shares shall, inter alia, be subject to conditions, as may be imposed from time to time by the RBI under FEMA in the matter of refund of application money, Allotment of Equity Shares, subsequent issue and Allotment of Equity Shares, interest, export of share certificates, etc. In case a NR or NRI Investor has specific approval from the RBI, in connection with his shareholding, he should enclose a copy of such approval with the CAF. Additionally, applications will not be accepted from NRs/NRIs in the United States or its territories and possessions, or any other jurisdiction where the offer or sale of the Rights Entitlements and Equity Shares may be restricted by applicable securities laws.

(j) All communication in connection with application for the Equity Shares, including any change in address

of the Investors should be addressed to the Registrar to the Issue prior to the date of Allotment in this Issue quoting the name of the first/sole Investor, folio numbers and CAF number. Please note that any intimation for change of address of Investors, after the date of Allotment, should be sent to the Registrar and Transfer Agents of our Company, in the case of Equity Shares held in physical form and to the respective depository participant, in case of Equity Shares held in dematerialized form.

(k) SAFs cannot be re-split. (l) Only the person or persons to whom Equity Shares have been offered and not Renouncee(s) shall be

entitled to obtain SAFs. (m) Investors must write their CAF number at the back of the cheque / demand draft. (n) Only one mode of payment per application should be used. The payment must be by cheque / demand draft

drawn on any of the banks, including a co-operative bank, which is situated at and is a member or a sub member of the Bankers Clearing House located at the centre indicated on the reverse of the CAF where the application is to be submitted.

(o) A separate cheque / draft must accompany each CAF. Outstation cheques / demand drafts or post-dated

cheques and postal / money orders will not be accepted and applications accompanied by such cheques / demand drafts / money orders or postal orders will be rejected. The Registrar will not accept payment

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against application if made in cash. (For payment against application in cash please refer point (e) above). (p) No receipt will be issued for application money received. The Bankers to the Issue / Collecting Bank /

Registrar, as the case may be, will acknowledge receipt of the same by stamping and returning the acknowledgment slip at the bottom of the CAF.

(q) The distribution of this Letter of Offer and issue of Equity Shares and Rights Entitlements to persons in

certain jurisdictions outside India may be restricted by legal requirements in those jurisdictions. Persons in the United States and such other jurisdictions are instructed to disregard this Letter of Offer and not to attempt to subscribe for Equity Shares.

(r) Investors shall be given an option to get the Equity Shares in demat or physical mode. Grounds for Technical Rejections Investors are advised to note that applications are liable to be rejected on technical grounds, including the following: Amount paid does not tally with the amount payable;

Bank account details (for refund) are not given;

Age of Investor(s) not given (in case of renouncees);

Except for CAFs on behalf of the Central or State Government, the residents of Sikkim and the officials appointed by the courts, PAN number not given for application of any value;

In case of CAF under power of attorney or by limited companies, corporate, trust, relevant documents are not submitted;

If the signature of the Investor does not match with the one given on the CAF and for renounce(s) if the signature does not match with the records available with their depositories;

CAFs are not submitted by the Investors within the time prescribed as per the CAF and the Letter of Offer;

CAFs not duly signed by the sole / joint Investors;

CAFs by OCBs;

CAFs accompanied by Stockinvest;

In case no corresponding record is available with the Depositories that matches three parameters, (a) names of the Investors (including the order of names of joint holders), (b) the DP ID and (c) the beneficiary account number, then such applications are liable to be rejected.

CAFs that do not include the certifications set out in the CAF to the effect that, among other thing, the subscriber is not located in the United States and is authorised to acquire the Rights Entitlements and Equity Shares in compliance with all applicable laws and regulations;

CAFs which have evidence of being executed in/dispatched from the United States or any other jurisdiction where the offer or sale of the Rights Entitlements and Equity Shares may be restricted by applicable securities laws;

CAFs by ineligible non-residents (including on account of restriction or prohibition under applicable local laws) and where a registered address in India has not been provided;

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CAFs where our Company believes that CAF is incomplete or acceptance of such CAF may infringe applicable legal or regulatory requirements;

In case the GIR number is submitted instead of the PAN;

Applications by renouncees who are persons not competent to contract under the Indian Contract Act, 1872, including minors; and

Multiple CAFs, including cases where an Investor submits CAFs along with a plain paper application.

Applications from QIBs or from Investors applying in this Issue for Equity Shares for an amount exceeding `2,00,000, which are not in ASBA.

Please read the Letter of Offer and the instructions contained therein and in the CAF carefully before filling in the CAF. The instructions contained in the CAF are an integral part of the Letter of Offer and must be carefully followed. The CAF is liable to be rejected for any non-compliance of the provisions contained in the Letter of Offer or the CAF. Investment by FIIs In accordance with the current regulations, the following restrictions are applicable for investment by FIIs: The Issue of Equity Shares under this Issue to a single FII should not exceed 10% of the post-issue paid up capital of our Company. In respect of an FII investing in the Equity Shares on behalf of its sub-accounts the investment on behalf of each sub-account shall not exceed 5% of the total paid up capital of our Company. Applications will not be accepted from FIIs in the United States or its territories and possessions, or any other jurisdiction where the offer or sale of the Rights Entitlements and Equity Shares may be restricted by applicable securities laws. Please note that pursuant to the applicability of the directions issued by SEBI vide its circular bearing number CIR/CFD/DIL/1/2011 dated April 29, 2011, all applicants who are QIBs or are applying in this Issue for Equity Shares for an amount exceeding `2,00,000 shall mandatorily make use of ASBA facility. Investment by NRIs Investments by NRIs are governed by the Portfolio Investment Scheme under Regulation 5(3)(i) of the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000. Applications will not be accepted from NRIs in the United States or its territories and possessions, or any other jurisdiction where the offer or sale of the Rights Entitlements and Equity Shares may be restricted by applicable securities laws. Please note that pursuant to the applicability of the directions issued by SEBI vide its circular bearing number CIR/CFD/DIL/1/2011 dated April 29, 2011, all applicants who are QIBs or are applying in this Issue for Equity Shares for an amount exceeding `2,00,000 shall mandatorily make use of ASBA facility. Procedure for Applications by Mutual Funds A separate application can be made in respect of each scheme of an Indian mutual fund registered with the SEBI and such applications shall not be treated as multiple applications. The applications made by asset management companies or custodians of a mutual fund should clearly indicate the name of the concerned scheme for which the application is being made.

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Please note that pursuant to the applicability of the directions issued by SEBI vide its circular bearing number CIR/CFD/DIL/1/2011 dated April 29, 2011, all applicants who are QIBs or are applying in this Issue for Equity Shares for an amount exceeding `2,00,000 shall mandatorily make use of ASBA facility. Impersonation As a matter of abundant caution, attention of the Investors is specifically drawn to the provisions of sub-section (1) of section 68A of the Companies Act which is reproduced below: “Any person who makes in a fictitious name an application to a Company for acquiring, or subscribing for, any shares therein, or otherwise induces a Company to Allot, or register any transfer of shares therein to him, or any other person in a fictitious name, shall be punishable with imprisonment for a term which may extend to five years”. Dematerialized dealing Our Company has entered into agreements dated October 31, 2000 and September 14, 2000 with NSDL and CDSL, respectively, and its Equity Shares bear the ISIN INE540B01015. Payment by Stockinvest In terms of RBI Circular DBOD No. FSC BC 42/24.47.00/2003- 04 dated 5 November 2003, the Stockinvest Scheme has been withdrawn. Hence, payment through Stockinvest would not be accepted in this Issue. Disposal of application and application money No acknowledgment will be issued for the application moneys received by our Company. However, the Bankers to the Issue / Registrar to the Issue receiving the CAF will acknowledge its receipt by stamping and returning the acknowledgment slip at the bottom of each CAF. The Board reserves its full, unqualified and absolute right to accept or reject any application, in whole or in part, and in either case without assigning any reason thereto. In case an application is rejected in full, the whole of the application money received will be refunded. Wherever an application is rejected in part, the balance of application money, if any, after adjusting any money due on Equity Shares allotted, will be refunded to the Investor within a period of 15 days from the Issue Closing Date. If such money is not repaid within eight days from the day our Company becomes liable to repay it, our Company and every Director of our Company who is an officer in default shall, on and from expiry of eight days, be jointly and severally liable to repay the money with interest as prescribed under Section 73 of the Companies Act. For further instructions, please read the CAF carefully. Utilisation of Issue Proceeds Our Board of Directors declares that: (i) All monies received out of this Issue shall be transferred to a separate bank account other than the bank

account referred to sub-section (3) of Section 73 of the Companies Act; (ii) Details of all monies utilized out of the Issue shall be disclosed under an appropriate separate head in the

balance sheet of our Company indicating the purpose for which such monies have been utilised; (iii) Details of all unutilized monies out of the Issue, if any, shall be disclosed under an appropriate separate

head in the balance sheet of our Company indicating the form in which such unutilized monies have been invested; and

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(iv) Our Company may utilize the funds collected in the Issue only after the basis of Allotment is finalized. Undertakings by our Company Our Company undertakes the following: 1. The complaints received in respect of the Issue shall be attended to by our Company expeditiously and

satisfactorily. 2. All steps for completion of the necessary formalities for listing and commencement of trading at all Stock

exchanges where the Equity Shares are to be listed will be taken within seven working days of finalization of basis of Allotment.

3. The funds required for making refunds to unsuccessful applicants as per the modes disclosed shall be made

available to the Registrar to the Issue by our Company. 4. Our Company undertakes that where refunds are made through electronic transfer of funds, a suitable

communication shall be sent to the Investor within 15 days of the Issue Closing Date, giving details of the banks where refunds shall be credited along with amount and expected date of electronic credit of refund.

5. Our Company accepts full responsibility for the accuracy of information given in this Letter of Offer and confirms that to the best of its knowledge and belief, there are no other facts the omission of which makes any statement made in this Letter of Offer misleading and further confirms that it has made all reasonable enquiries to ascertain such facts.

6. Adequate arrangements shall be made to collect all ASBA applications and to consider them similar to non-ASBA applications while finalising the basis of Allotment.

7. At any given time there shall be only one denomination for the Equity Shares of our Company.

8. We shall comply with such disclosure and accounting norms specified by SEBI from time to time. Minimum Subscription If our Company does not receive the minimum subscription of 90% of the Issue, our Company shall forthwith refund the entire subscription amount received within 15 days from the Issue Closing Date. If such money is not repaid within eight days from the day our Company becomes liable to repay it, (i.e. 15 days after the Issue Closing Date or the date of the refusal by the Stock Exchange(s), whichever is earlier) our Company and every Director of our Company who is an officer in default shall, on and from expiry of eight days, be jointly and severally liable to repay the money with interest as prescribed under sub-section (2) and (2A) of Section 73 of the Companies Act. Important Please read this Letter of Offer carefully before taking any action. The instructions contained in the

accompanying CAF are an integral part of the conditions of this Letter of Offer and must be carefully followed; otherwise the application is liable to be rejected.

All enquiries in connection with this Letter of Offer or accompanying CAF and requests for SAFs must be addressed (quoting the Registered Folio Number/ DP and Client ID, the CAF number and the name of the first Equity Shareholder as mentioned on the CAF and super scribed ‘[●] Rights Issue’ on the envelope and postmarked in India) to the Registrar to the Issue at the following address:

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Link Intime India Private Limited C 13, Pannalal Silk Mills Compound LBS Marg, Bhandup (West) Mumbai 400 078 Tel: +91 22 2596 7878 Toll-free: 1-800-22-0878 Facsimile: +91 22 2596 0329 E-mail: rml.rights@linkintime.co.in Investor Grievance Email: rml.rights@linkintime.co.in Website: www.linkintime.co.in Contact Person: Pravin Kasare

SEBI Registration No.: INR 0000 04058 It is to be specifically noted that this Issue of Equity Shares is subject to the risk factors mentioned in the

section entitled “Risk Factors” at page 11. The Rights Entitlement and the Equity Shares are not intended to be offered or sold to persons in the United

States or any other jurisdiction where such offer or sale may be prohibited. The offering to which this Letter of Offer relates is not, and under no circumstances is to be construed as, an offering of any shares or rights to sale in the United States, the territories or possessions thereof, or a solicitation therein of an offer to buy any of the said shares or rights. Accordingly, this Letter of Offer and the CAF should not be dispatched or forwarded to or transmitted in or to, the United States at any time. Our Company and the Lead Manager reserve absolute discretion in determining whether to allow such participation as well as the identity of the persons who may be allowed to do so. Any person who acquires Rights Entitlements or Equity Shares will be deemed to have declared, warranted and agreed, by accepting the delivery of the Letter of Offer, that it is not and that at the time of subscribing for the Equity Shares or the Rights Entitlements, it will not be, in the United States or any other jurisdiction where such acquisition may be prohibited.

THE ISSUE WILL REMAIN OPEN FOR A MINIMUM 15 DAYS. HOWEVER, THE BOARD WILL

HAVE THE RIGHT TO EXTEND THE ISSUE PERIOD AS IT MAY DETERMINE FROM TIME TO TIME BUT NOT EXCEEDING 30 DAYS FROM THE ISSUE OPENING DATE.

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RESTRICTIONS ON FOREIGN OWNERSHIP OF INDIAN SECURITIES Foreign investment in Indian securities is regulated through the Industrial Policy, 1991 of the Government of India and FEMA. While the Industrial Policy, 1991 prescribes the limits and the conditions subject to which foreign investment can be made in different sectors of the Indian economy, FEMA regulates the precise manner in which such investment may be made. Under the Industrial Policy, unless specifically restricted, foreign investment is freely permitted in all sectors of the Indian economy up to any extent and without any prior approvals, but the foreign investor is required to follow certain prescribed procedures for making such investment. The government bodies responsible for granting foreign investment approvals are FIPB and RBI. Subscription by foreign investors (NRIs/FIIs) FIIs are permitted to subscribe to shares of an Indian company in a public offer without the prior approval of the RBI, so long as the price of the equity shares to be issued is not less than the price at which the equity shares are issued to residents. The transfer of shares between an Indian resident and a non-resident does not require the prior approval of the FIPB or the RBI, provided that (i) the activities of the investee company are under the automatic route under the foreign direct investment (“FDI”) Policy and transfer does not attract the provisions of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (ii) the non-resident shareholding is within the sectoral limits under the FDI policy; and (iii) the pricing is in accordance with the guidelines prescribed by the SEBI/RBI. As per the existing policy of the Government of India, OCBs cannot participate in this Issue.

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SECTION VIII: MAIN PROVISIONS OF ARTICLES OF ASSOCIATION

Capitalised terms used in this section have the meaning that has been given to such terms in the Articles of Association of our Company. Pursuant to Schedule II of the Companies Act and the ICDR Regulations, the main provisions of the Articles of Association of our Company are detailed below: The regulations contained in Table 'A' in Schedule I of the Companies Act, 1956, shall not apply to our Company on its registration, but instead thereof regulations contained in these Articles shall apply. Capital Article 3 provides that “The Authorised Capital of the Company shall be as per Capital Clause of the Memorandum of Association of the Company with power to increase, reduce, divide and/or sub-divide the Share Capital or reclassify them into several classes and attach thereto respectively such preferential, priority, deferred, qualified or special rights, privileges, conditions or restrictions, whether in regard to dividend, voting, return of capital, distribution of assets or otherwise, as may be determined in accordance with the laws, rules and regulations applicable to the Company and to vary, modify or abrogate such rights, privileges, conditions or restrictions in such manner as may from time to time be provided by the regulations/resolutions of the Company or are provided for in the Articles of Association of the Company and to consolidate or sub-divide or re-organise shares or issue shares of higher or lower denominations..” Article 4 provides that “Such shares of the authorised capital to carry such rights, privileges and conditions attached thereto as are provided by the regulations of the Company for the time being and with the power to increase and reduce the Share Capital of the Company and to divide the Shares in the Capital for the time being into several classes and to attach thereto respectively such preferential rights, privileges or conditions as may be determined by or in accordance with the regulations of the Company and to vary, modify or abrogate any such rights, privileges or conditions in such manner as may for the time being be provided by the regulations of the Company. The rights of the preference shares shall be determined at the time of issue thereof.” Increase of Capital by the Company at how carried into effect Article 5 provides that “The Company may in General Meeting, from time to time by ordinary resolution, increase its capital by creation of new shares which may be unclassified and may be classified at the time of issue in one or more classes and of such amount or amounts as may be deemed expedient. The new shares shall be issued upon such terms and conditions with such rights and privileges annexed thereto as the resolution shall be prescribed and in particular, such shares may be issued with a preferential or qualified right to dividends and in the distribution of assets of the Company and with a right of voting at General Meeting of the Company in conformity with Section 87 and 88 of Act, Whenever the Capital of the Company has been increased under the provisions of this Article, the Directors shall comply with the provisions of Section 97 of the Act.” Article 5a provides that “The Company may by special resolution, reduce or adjust in any manner, subject to any authorizations and approvals required by Law- (a) its Share Capital (b) any Capital Redemption Reserve Account (c) any Securities Premium Account Notwithstanding the above any amounts standing to the credit of Securities Premium Account may also be utilized other than for capitalization, for any other purposes as are in accordance with the provisions of law.” Redeemable Preference Shares Article 7 (1) provides that “Subject to the provision of Section 80 of the Act, the Company shall have the power to issue preference shares which are or at the option of the Company are liable to be redeemed in accordance with Section 80A of the Act and the resolution authorizing such issue shall prescribe the manner, terms and conditions of

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redemption.” Further Issue of Capital Article 8(a) provides that “The Company shall have right to issue further shares in accordance with the provision of Section 81 of the Act.” Sub-division, consolidation and cancellation of Shares Article 8(b) provides that “Subject to the provisions of Section 94 and other applicable provisions of the Act, the Company in General Meeting may, from time to time, sub-divide or consolidate its shares or any of them and the resolution where by any share is sub-divided may determine that, as between the holders of the shares resulting from such sub-division one or more of such shares shall have same preference or special advantage as regards dividend, capital or otherwise over or as compared with the other or other subject as aforesaid, the Company in General Meeting may also cancel shares which have not been taken or agreed to be taken by any person and diminish the amount of its share capital by the amount of the shares so cancelled.” Modification of rights Article 9 provides that “Wherever the capital, by reason of the issue of the preference shares or otherwise is divided into different classes of shares, all or any of the rights and privileges attached to each class may, subject to the provisions of sections 106 and 107 of the Act, be modified, commuted, affected, abrogated, dealt with or varied with the consent in writing of the holders, of not less than three fourth of the issues capital of that class or with the sanction of a special resolution passed at a separate general meeting of the holders of shares of that class and all the provisions hereinafter contained as to general meeting shall mutatis mutandis apply to every such meeting. This Article is not to derogate from any power the Company would have if this Article was omitted. The rights conferred upon the holders of the shares (including preference shares if any) of any class issued with preferred or other rights or privileges shall unless otherwise expressly provided by the terms of issue of shares of that class, be deemed not to be modified, commuted, affected, abrogated dealt with or varied by the creation of issue of further shares ranking pari passu therewith.” Beneficial Owner (Including Depository) Article 12 provides that “Save as herein otherwise provided, the Company shall be entitled to treat the person whose name appears on the Register of Members as the holder of any share or whose name appears as the beneficial owner of shares in the records of the depository, as the absolute owner thereof and accordingly shall not except as ordered by a court of competent jurisdiction or as by law require, be bound to recognize any benami trust or equity or equitable, contingent, future or partial or other claim or claims or right to or interest in such share on the part of any other person whether or not it shall have express or implied notice thereof. No Notice of any trust, express, implied or constructive shall be entered in the Register of Members or of debenture holders.” The Board may issue shares as fully paid-up Article 14 provides that “Subject to the provisions of the Act and these Articles, the Board may allot and issue shares in the Capital of the Company as payment of any property sold or transferred or for services rendered to the Company in the conduct of its business or in satisfaction of any shares, which may be so issued shall be deemed to be fully paid-up or partly paid-up shares.”

Acceptance of shares Article 15 provides that “Any application signed by or on behalf of an applicant for shares in the Company followed by an allotment of any share therein, shall be an acceptance of shares within the meaning of these

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Articles and every person who thus or otherwise accepts any shares and whose name is therefore placed on the register shall, for the purpose of this Articles, be a member.”

Deposit and Call etc. to be a debt payable Article 16 provides that “The money, if any, which the Board of Directors shall on the allotment of any shares being made by them, require or direct to be paid by way of deposit, call or otherwise, in respect of any shares allotted by them shall immediately on the inscription of the name of the allotted in the register of members as the name of the holder of such shares, become a debt due to and recoverable by the Company from the allotted thereof and shall be paid by him accordingly.”

Liability of Members Article 17 provides that “Every member or his heirs, executors or administrators to the extent of his assets which come to their hands shall be liable to pay of the Company the portion of the capital represented by his shares or shares which may, for the time being remain unpaid thereon in such amount at such time or times and in such manner as the Board of Directors shall from time to time, in accordance with the Company’s requisitions, require or fix for the payment thereof.” Share Certificate Article 18 provides that “(a) Every member or allottee of shares shall be entitled, without payment to receive one certificate for all the shares of the same class registered in his name. Every share certificate shall specify the name of the person in whose favour it is issued, the share certificate number and the distinctive number(s) of the shares to which it relates and the amount paid up thereon. Such certificate shall be issued only in pursuance of resolution passed by the Board and on surrender to the Company of its letter of allotment or its fractional coupons of requisite value, save in cases of issues, against letters of acceptance or of renunciation or in cases of issue of bonus shares PROVIDED THAT if the letter of allotment is lost or destroyed, the Board may impose such reasonable terms, if, any as it think fit, as to evidence and indemnity and the payment of out of pocket expenses incurred by the Company in investigating the evidence. If any member shall require additional certificate he shall pay for each additional certificate (not being in the marketable lot) such sum not exceeding One Rupee as the Directors shall determine. The certificates of title to shares shall be issued under the seal of the Company and shall be signed in conformity with the provisions of the Companies (Issue of Share Certificates) Rules, 1960 or any statutory modification or re-enactment thereof for the time being in force. Printing of blank forms to be used for issue of share certificates and maintenance of books and documents relating to issue of Share Certificate shall be in accordance with the provisions of the aforesaid rules. Such certificates of title to shares shall be completed and kept ready for delivery within three months after the allotment and within one month after the application for the registration of the transfer of any such shares unless the conditions of issue of share provide otherwise.

(b) Any two or more joint allottee or holders of shares shall, for the purpose of this Article, be treated as a single member and the certificate of any share which may be the subject of joint ownership may be delivered to any one of such joint owners on behalf of all of them. (c) Provided, however, that no share certificate (s) shall be issued in respect of shares held in Depository.” Renewal of Shares Certificate Article 19 provides that “No Certificate of any share or share shall be issued either in exchange for those which are sub-divided or consolidated or in replacement of those which are defaced, torn or old, decrepit, worn out or where the pages on the reverse for recording transfer have been duly utilized unless the certificate in lieu of which it is issued is surrendered to the Company. PROVIDED THAT no fees shall be charged for issue of new certificates in replacement of those which are old, decrepit or worn out or where the pages on the reverse for recording transfer have been fully utilized.

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In case of rematerialisation of shares, procedure thereof as may be prescribed under law, shall be followed.” Dematerialisation of shares Article 21 provides that “The Company shall be entitled to dematerialize its existing shares, debentures and other securities, rematerialize its shares, debentures and other securities held in Depositories and other securities, in a dematerialized form pursuant to the Depositories Act,1996 and the rules, bye laws, regulations framed thereunder, if any.” Company not bound to recognize any interest in share other than of registered holder Article 22 provides that “Except as ordered by a Court of Competent jurisdiction or as by law required, the Company shall not be bound to recognize, even when having notice thereof, any equitable, contingent, future or partial interest in any share of (except only as is by these Articles otherwise expressly provided) any right in respect of a share other than an absolute right thereto, in accordance with these Articles, of the person from time to time registered as holder thereof but the Board shall be at liberty at their sole discretion to register any share in the joint names of any two or more persons (but not exceeding 4 persons) or the survivor or survivors of them.” Trust not recognized Article 23 provides that “(a) Save as herein otherwise provided, the Company shall be entitled to treat the person whose name appears on the Register of Members as the holder of any share as the absolute owner thereof and accordingly shall not ( except as ordered by a Court of Competent jurisdiction or as by law required) be bound to recognize any benami, trust or equity or equitable, contingent, future or partial or other claim or claim s or rights to or interest in such share in the part of any other person whether or not it shall have express or limited notice thereof. The provisions of Section 153 of the Act, shall apply. (b) Shares may be registered in the name of an incorporated Company or other body corporate but not in the name of a minor (except in case where they are fully paid) or in the name of a person of unsound mind or in the name of any firm or partnership.” Calls Directors may make call Article 28 provides that “(a)Subject to the provisions of Section 91 of the Act the Board of Directors may, from time to time by a Resolution passed at a meeting of a Board ( and not be a circular resolution) make such calls as it think fit upon the members in respect of all moneys unpaid on the shares whether on account of the nominal value of the shares or by way of premium, held by them respectively and not be conditions of allotment thereof made payable at fixed time and each member shall pay the amount of every calls so made payable at fixed time and each member shall pay the amount of every call so made on him to the person or person and at the times and places appointed by the Board of Directors. A call may be made payable by installments. A call may be postponed or revoked as the Board may determine. Liability of joint-holders Article 28 provides that “(b) The joint holders of a share shall be jointly and severally liable to pay all calls in respect thereof.” Notice or calls Article 29 provides that “Not less than thirty days notice in writing of any calls shall be given by the Company specifying the time and place of payment and the person or persons to whom such calls shall be paid.” When call deemed to have been made

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Article 30 provides that “A call shall be deemed to have been made at the time when the resolution authorizing such call was passed at a meeting of the Board of Directors and may be made payable to the members on such date or at the discretion of the Directors on such subsequent date as shall be fixed by the Board of Directors.” Evidence in action by Company against shareholders. Article 34 provides that “On the trial or hearing of any action or suit brought by the Company against any member or his legal representative for the recovery of any moneys claimed to be due to the Company in respect of his shares it shall be sufficient to prove that the name of the members in respect of whose shares the money is sought to be recovered and entered on the register of member as the holder or as one of the holders at or subsequent to the date at which in money sought to be recovered is alleged to have become due on the shares in respect of which the money is sought to be recovered that the resolution making the call is duly recorded in the minute book and the notice of such call was duly given to the member or his legal representative sued in pursuance of these Articles and it shall not be necessary to prove the appointment of Directors who made such call, not that a quorum of Directors was present at the Board at which any call was made not that the meeting at which any call was made was duly convened or constituted nor any other matter whatsoever but the proof of the matters aforesaid shall be conclusive evidence of the debt.” Lien Partial payment not to preclude forfeiture Article 36 provides that “Neither the receipt by the Company of a portion of any money which shall, from time to time, be due from any member to the Company in respect of his shares, either by way of principal or interest of any indulgence granted by the Company in respect of the payment of such money, shall preclude the Company from thereafter proceeding to enforce a forfeiture of such shares as hereinafter provided.” Company to have lien on shares Article 37 provides that “The Company shall have a first and paramount lien upon all shares (other than fully paid up shares registered in the name of each member whether solely or jointly with others) and upon the proceeds of sale thereof, for all moneys (whether presently payable or not), called or payable at a fixed time in respect of such shares and no equitable interests in any share shall be created except upon the footing and condition that this Article is to have full legal effect. Any such lien shall extend to all dividends from time to time declared in respect of shares, PROVIDED THAT the Board of Directors may, at any time, declare any share to be wholly or in exempt from the provisions of this Article.” As to enforcing lien by sale Article 38 provides that “The Company may sell, in such manner as the Board thinks, fit, any shares on which the Company has a lien for the purpose of enforcing the same PROVIDIED THAT no sale shall be made: (a) Unless a sum in respect of which the lien exists is presently payable or (b) Until the expiration of fourteen days after a notice in writing starting and demanding payment of such part of the amount in respect of which the lien exists as is presently payable has been given to the registered holder for the time being of the share or the person entitled thereto by reason of his death or insolvency. For the purposes of such sale, the Board may cause to be issued a duplicate certificate in respect of such shares and may authorize one of their members to execute a transfer thereof on behalf of and in the name of such members. (c) The purchaser shall not be bound to see the application of the purchase money nor shall his title to the shares be affected by any irregularity or invalidity in the proceedings in reference to the sale.”

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Application of proceeds of sale Article 39 provides that “(a)The net proceeds of any such sale shall be received by the Company and applied in or towards satisfaction of such part of the amount in respect of which the lien exists as is presently payable; and (b) The residue, if any, after adjusting costs and expenses, if any, incurred shall be paid to the person entitled to the shares at the date of the sale (subject to a like lien for sums not presently payable existed on the shares before the sale.)” Forfeiture of Shares If money payable on share not paid notice to be given Article 40 provides that “If any member fails to pay the whole or any part of any call or any installment of a call on or before the day appointed for the payment of the same or any such extension thereof, the Board of Directors may, at any time thereafter, during such time as the call for installment remains unpaid, give notice to his requiring him to pay the same together with any interest that may have accrued and all expenses that may have been incurred by the Company by reason of such non-payment.” In default of payment shares to be forfeited Article 43 provides that “If the requirements of any such notice as aforesaid are not complied with any share or shares in respect of which such notice has been given may at any time thereafter before payment of all calls or installments, interests and expenses due in respect thereof, be forfeited by a resolution of the Board of Directors to that effect. Such forfeiture shall include all dividends declared or any other moneys payable in respect of the forfeited shares and not actually paid before the forfeiture.” Notice of forfeiture to a member Article 44 provides that “When any share shall have been so forfeited, notice of the forfeiture shall be given to the member in whose name it stood immediately prior to the forfeiture and an entry of the forfeiture, with the date thereof, shall forthwith be made in the Register of Members, but no forfeiture shall be in any manner invalidated by any omission or neglect to give such notice or to make any such entry as aforesaid.”

Forfeited share to be the property of the Company and may be sold etc. Article 45 provides that “Any share so forfeited, shall be deemed to be the property of the Company and may be sold, re-allotted or otherwise disposed off, either to the original holder or to any other person upon such terms and in such manner as the Board of Directors shall think fit.

Member still liable to pay money owing at the time of forfeiture and interest Article 46 provides that “Any member whose shares have been forfeited shall notwithstanding the forfeiture be liable to pay and shall forthwith pay to the Company on demand all calls, installments, interest and expenses owing upon or in respect of such shares at the time of the forfeiture together with interest thereon from the time of the forfeiture until payment, at such rate not exceeding eighteen percent per annum as the Board of Directors may determine and the Board of Directors may enforce the payment of such moneys or any part thereof, if it thinks fit, but shall not be under any obligation to do so.”

Effect of forfeiture Article 47 provides that “The forfeiture of a share shall involve the extinction at the time of the forfeiture of all interest in and all claims and demand against the Company in respect of the share and all other rights incidental to the share, except only such to those rights as by these Articles are expressly saved.”

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Power to annual forfeiture Article 48 provides that “The Board of Directors may at any time before any share so forfeited shall have been sold, re-allotted or otherwise disposed off, annul the forfeiture thereof upon such conditions as it thinks fit.” Cancellation of share certificate in respect of forfeited shares Article 51 provides that “Upon sale, re-allotment or other disposal, under the provisions of these Articles, the certificate or certificates originally issued in respect of the relative shares shall (unless the same shall on demand by the Company have been previously surrendered to it by the defaulting member) stand cancelled and become null and void and of no effect and the Directors shall be entitled to issue a new certificate or certificates in respect of the said shares to the person of persons entitled thereto.” Surrender of Shares Article 54 provides that “The Directors may, subject to the provisions of the Act, accept a surrender of any share from any member desirous of surrendering on such terms and condition as they think fit.” Transfer and Transmission of Shares Article 55 provides that “The Company shall keep a book to be called “Register of Transfer’ and therein shall be fairly and distantly entered particulars of every transfer or transmission of any share held in a material form.” Article 56 provides that “In the case of transfer or transmission of shares or other marketable securities where the Company has not issued any certificates and where such shares or securities are being held in an electronic and fungible form in a Depository, the provisions of the Depositories Act, 1996 shall Apply.” Form of transfer Article 57 provides that “The instrument of transfer of any share shall be in the prescribed form under the Companies (Central Government) General Rules and Forms, 1956 and in accordance with the requirements of Section 108 of the Act.” Transfer to be presented with evidence of title Article 59 provides that “Every instrument of transfer shall be presented to the Company duly stamped for registration accompanied by such evidence as the Board may required to prove the tile of the transferor, his right to transfer the shares and generally under the subject to such conditions and regulations as the Board may, from time to time, prescribe and every registered instrument of transfer shall remain in the custody of the Company until destroyed by order of the Board. In case of securities being dematerialized, procedure as applicable to demat, to be followed.” Nomination facility Article 61 provides that “(1) Every holder of shares in, or holder of debentures of, a Company may, at any time nominate, in the prescribed manner, a person to whom his shares in, or debentures of, the Company shall vest in the event of his death. (2) Where the shares in, or debentures of, a Company are held by more than one person jointly, the joint holders may together nominate, in the prescribed manner, a person to whom all the rights in the shares or debentures of the Company shall vest in the event of death of all the joint holders. (3) Notwithstanding anything contained in any other law for the time being in force or in any disposition, whether testamentary or otherwise, in respect of such shares in, or debentures of, the Company, where a nomination made in the prescribed manner purports to confer on any person the right to vest the shares in or debentures of the

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Company, the nominee shall, on the death of the share holder or holder of debentures of the Company or, as the case may be, on the death of the joint holders become entitled to all the rights in the shares or debentures of the Company or, as the case may be, all the joint holders, in relation to such shares in, or debentures of the Company to the exclusion of all other persons, unless the nomination is varied or cancelled in the prescribed manner. (4) Where the nominee is a minor, it shall be lawful for the holder of the shares or holder of debentures, to make the nomination to appoint in the prescribed manner any person to become entitled to shares in or debentures of the Company, in the event of his death, during the minority.” Transmission of shares Article 62 provides that “(1) Any person who becomes a nominee by virtue of the provisions of section 109A, upon the production of such evidence as may be required by the Board and subject as hereinafter provided, elect, either. (a) to be registered himself as holder of the share of debenture, as the case may be ; or (b) to make such transfer of the share or debenture , as the case may be, as the deceased shareholder or debenture holder, as the case may be, could have made. (2) The Board shall, in either case, have the same right to decline or suspend registration, as it would have had, if the deceased shareholder or debenture holder, as the case may be, had transferred the share of debenture, as the case may be, before his death. (3) If the person being a nominee, so becoming entitled, elects to be registered as holder of the share or debenture, as the case may be, himself, he shall deliver or send to the Company a notice in writing signed by him stating that he so elects and such notice shall be accompanied with the death certificate of the deceased shareholder or debenture holder, as the case may be. (4) All the limitations, restrictions and provisions of this Act relating to the right to transfer and the registration of the transfers of shares or debentures shall be applicable to any such notice of transfer as aforesaid as if the death of the member had not occurred and the notice of transfer were a transfer signed by that shareholder or debenture holder, as the case may be. (5) A person, being a nominee, becoming entitled to a share or debenture by reason of the death of the holder shall be entitled to the same dividends and other advantages to which he would be entitled if he were the registered holder of the share or debenture except that he shall not, before being registered a member in respect of his share or debenture, be entitled in respect of it to exercise any right conferred by membership in relation to meetings of the Company. Provided that the Board may, at time, give notice requiring any such person to elect either to be registered himself or to transfer the share or debenture, and if the notice is not complied with within ninety days, the Board may thereafter with hold payment of all dividends, bonuses or other moneys payable in respect of the share or debenture, until the requirements of the notice have been complied with.” Buy Back of securities Article 63 provides that “The Company shall have the power subject to and in accordance with all other applicable provisions of the Act to purchase any of its own shares, whether or not they are redeemable, at such rate(s) and to keep them alive and/or reissue from time to time such number(s) of shares, purchased at such rate (s) and on such terms and conditions as the Board may deem fit and appropriate. Except to the extent permitted by Section 77 or other applicable provisions (if any) of the Act, the Company shall not give whether directly or indirectly and whether by means of a loan, guarantee, provisions of security or otherwise any financial assistance for the purpose of, or in connection with the purchase or subscription made or to be made by any person of or for any shares in the Company.”

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Power of Company to purchase its own securities. Article 64 provides that “(1) The Company may purchase its own shares or other specified securities (hereinafter referred to as “buy-back”) out of – (i) its free reserves; or (ii) the securities premium account ; or (iii) the proceeds of any shares or other specified securities However, no buy-back of any kind of shares or other specified securities shall be made out of the proceeds of an earlier issue of the same kind of shares or same kind of other specified securities. (2) The company shall not purchase its own shares or other specified securities under sub-section (1) unless – (a) a special resolution has been passed in general meeting of the company authorising the buy back; (b) the buy-back does not exceed twenty five percent of the total paid-up capital and free reserves of the company. However the buy-back of the equity shares in any financial year shall not exceed twenty five percent of its total paid-up equity capital in that financial year; (c) the ratio of the debt owed by the company is not more than twice the capital and its free reserves after such buy-back or such other ratio as the Central Government may prescribe. (d) all the shares or other specified securities for buy-back are fully paid-up; (3) The notice of the meeting at which special resolution is proposed to be passed shall be accompanied by an explanatory statement stating - (a) a full and complete disclosure of all material facts; (b) the necessity for the buy-back; (c) the class of security intended to be purchased under the buy-back; (d) the amount to be invested under the buy-back; and (e) the time limit for completion of buy-back. (4) Every buy-back shall be completed within twelve months from the date of passing the special resolution under clause (b) of sub-section (2). (5) The buy-back under sub-section (1) may be (a) from the existing security holders on a proportionate basis; or (b) from the open market; or (c) from old lots, that is to say, where the lot of securities is listed public company, whose shares are listed on a recognized stock exchange, is smaller than such market lot, as may be specified by the stock exchange; or (d) by purchasing the securities issued to employees of the company pursuant to a scheme of stock option or sweat equity.

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(6) Where the company has passed a special resolution under sub-clause (b) if Clause (2) to buy-back its own shares or other securities under this section, it shall, before making such purchases, file with the Registrar and the Securities and Exchange Board of India a declaration of solvency in the form prescribed, verified an affidavit to the effect that the Board has made a full inquiry into the affairs of the company as a result of which it is capable of meeting its liabilities and will not be rendered insolvent within period of one year of the date of declaration adopted by the Board, and signed by at least two directors of the company, one of whom shall be the managing director, if any: However the company shall file no declaration of solvency with the Securities and Exchange Board of India so long its share is not listed on any recognized stock exchange. (7) Where the company buys-back its own securities, it shall extinguish and physically destroy the securities so bought-back within seven days of the last date of completion of buy-back. (8) Where the company completes a buy-back of its shares or other securities, it shall not make further issue of the same kind of shares (including allotment of further shares under clause (a) of sub-section (1) of section 81) or other specified securities within a period of twenty-four months except by way of bonus issue or in the discharge of subsisting obligations such as conversion of warrants, stock option schemes sweat equity or conversion of preference shares or debentures into equity shares. (9) Where the company buys-back its securities under this section, it shall maintain a register of the securities so bought, the consideration paid for the securities bought-back the date of cancellation of securities, the date of extinguishing and physically destroying of securities and such other particulars as may be prescribed. (10) The company shall, after the completion of the buy-back under this section, file with the Registrar and the Securities and Exchange Board of India, a return containing such particulars relating to the buy-back within thirty days of such completion, as may be prescribed. However no return shall be filed with the Securities and Exchange Board of India as long as the shares of the Company are not listed on any recognised stock exchange. Transfer of certain sums to capital redemption reserve account Article 65 provides that “Where the company purchases its own shares out of free reserves, then sum equal to the nominal value of the share so purchased shall be transferred to the capital redemption reserve account referred to in clause (d) of the provision to sub-section (1) of section 80 and details of such transfer shall be disclosed in the balance-sheet.” Prohibition for buy-back in certain circumstances Article 66 provides that (1) The Company shall not directly or indirectly purchase its own shares or other specified securities – (a) through any subsidiary company including its own subsidiary companies; or (b) through any investment company or group of investment company; or (c) if a default, in repayment of deposit, redemption of debenture of preference shares or payment of dividend to any share holder or repayment of a term loan or interest payable thereon to any financial institution or bank is subsisting. (2) The company shall not directly or indirectly purchase its own shares or other specified securities in case such company has not complied with provisions of Section 159, 207 and 211.

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Issue of sweat equity shares Article 67 provides that “(1) The company may issue sweat equity shares of a class of shares already issued if the following conditions are fulfilled, namely: (a) the issue of sweat equity shares is authorised by a special resolution passed by the company in the general meeting; (b) the resolution specifies the number of shares, current market price, consideration if any, and the class or classes of directors or employees to whom such equity shares are to be issued; (c) not less than one year has at the date of the issue elapsed since the date on which the company was entitled to commence business (d) the sweat equity shares of a company whose shares are listed on a recognised stock exchange are issued in accordance with the regulations made by the Securities Exchange Board of India in this behalf. However, so long as the equity shares of the Company are not listed on any recognized stock exchange, the sweat equity shares are to be issued in accordance with the guidelines as may be prescribed. (2) All the limitations, restrictions and provisions relating to equity shares shall be applicable to such sweat equity shares issued under clause (1).” Power to issue share warrants Article 68 provides that “The Company may issue warrants subject to and in accordance with the provisions of Section 114 and 115 of the Act and accordingly the Board may in its discretion with respect to any share which is fully paid upon application in writing signed by the persons registered as holder of the share and authenticated by such evidence (if any) as the Board may, from time to time, require as to the identity of the person signing the application and on receiving the certificates (if any) of the share and the amount of the stamp duty on the warrant and such fee as the Board may, from time to time, require, issue a share warrant.” Deposit of Share Warrants Article 69 provides that “(a) The bearer of a share warrant may, at any time, deposit the warrant at the office of the Company and so long as the warrant remains so deposited, the depositor shall have the same right of signing a requisition for calling a meeting of the Company and of attending and voting and exercising the other privileges of the member at any meeting held after the expiry of two clear days from the time of deposit, as if his name were inserted in the Register of Members as the holder of the share included in the deposit warrant. (b) Not more than one person shall be recognized as depositor of the share warrant. (c) The Company shall, on two days’ written notice, return the deposited share warrant to the depositor;” Privileges and disabilities of the holders of share warrant Article 70 provides that “(a) Subject as herein otherwise expressly provided, no person shall as bearer of a share warrant, sign a requisition for calling a meeting of the Company or attend or vote or exercise any other privileges of a member at a meeting of the Company or be entitled to receive any notice from the Company. (b) The bearer of a share warrant shall be entitled in all other respects to the same privileges and advantages as if he were named in the Register of members as the Holder of the Share included in the warrant and he shall be a member of the Company.” Issue of new share warrant or coupon

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Article 71 provides that “The Board may, from time to time, make bye-laws as to the terms on which (if it shall think fit), a new share warrant or coupon maybe issued by way of renewal in case of defacement, loss or destruction.” Conversion of Shares into Stock and reconversion Article 72 provides that “Share may be converted into stock The Company may, by Ordinary Resolution: (a) convert any paid up share into stock; and (b) reconvert any stock into paid-up shares of any denomination.” Transfer of Stock Article 73 provides that “The several holders of such stock may transfer their respective interest therein or any part thereof in the same manner and subject to the same regulations under which the stock arose might, before the conversion, have been transferred or as near thereto as circumstances admit. PROVIDED THAT the Board may, from time to time, fix the minimum amount of stock transferable, so however that such minimum shall not exceed the nominal amount of the shares from which the stock arose.” Right of stockholders Article 74 provides that “The holders of stock shall, according to the amount of stock held by them, have the same right, privileges and advantages as regards dividends, voting at meeting of the Company and other matters, as if they held shares from which the stock arose, but no such privilege or advantage (except participation in the dividends and profits of the Company and in the assets on winding up) shall be conferred by an amount of stock which would not, if existing in shares, have conferred those privileges or advantages.” Power of Borrow Article 76 provides that “Subject to the provisions of Section 58A, 292 and 293 of the Act and of these Article, the Board of Directors may, from time to time at its discretion by a resolution passed at a meeting of the Board, borrow, accept, deposits from members either in advance of calls or otherwise and generally raise or borrow or secure the payment of any such sum or sums of money for the purpose of the Company from any source. PROVIDED THAT, where the moneys to be borrowed together with the moneys already borrowed (apart from temporary loans obtained from the Company’s bankers in the ordinary course of business) exceeds the aggregate of the paid up capital of the Company and its free reserves (not being reserves set apart for any specific purpose) the Board of Directors shall not borrow such money without the sanction of the Company in general meeting. No debt incurred by the Company in excess of the limit imposed by this Article shall be valid or effectual unless the lender proves that he advanced the loan in good faith and without knowledge that the limit imposed by this Article had been exceeded.” The payment or repayment of money borrowed Article 77 provides that “The payment or repayment of moneys borrowed as aforesaid may be secured in such manner and upon such terms and conditions in all respects as the Board of Directors may think fit and in particular in pursuance of a resolution passed at a meeting of the Board(and not by circular Resolution) by the issue of bonds, debentures or debenture-stock of the Company, charged upon all or any part of the property of the Company, (both present and future) including its uncalled capital for the time being and the debentures and the debenture-stock and other securities may be made assignable free from any equities between the Company and the person to whom the same may be issued.”

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Term of issue of debenture Article 78 provides that “Any debentures, debenture-stock or other securities may be issued at a discount, premium or otherwise and may be issued on condition that they shall be convertible into share of any denomination and with any privileges and conditions as to redemption, surrender, drawing, allotment of shares, attending (but not voting) at General Meeting, appointment of Directors and otherwise, debentures with the right to conversion into or allotment of shares shall be issued only with the consent of the Company in General Meeting by a Special Resolution.” Mortgage of uncalled capital Article 79 provides that “If any uncalled capital of the company is included in or charged by an mortgage or other security, the Directors may, subject to the provisions of the Act and these Articles, make calls on the members in respect of such uncalled capital in trust for the person in whose favour such mortgage or security executed.” Statutory Meeting Article 80 provides that “The Statutory Meeting shall be held in accordance with the provisions of Section 165 of the Act within a period of not less than one month and not more than six months from the date on which the Company shall be entitled to commence business.” Annual General Meeting Article 81 provides that “The Company shall in each year hold a General Meeting as its Annual General Meeting in addition to any other Meeting in that year. All General Meetings other than Annual General Meetings shall be called Extra-ordinary General Meetings. An Annual General Meeting of the company shall be held within six months after the expiry of each financial year, provided that not more than fifteen months shall lapse between the date of the Annual General Meeting and that of next. Nothing contained in the foregoing provision shall be taken as affecting the right conferred upon the Registrar under the provisions of section 166 (1) of the Act to extend the time within which any Annual General Meeting may be held. Every Annual General Meeting shall be called for a time during business hours, on a day that is not a public holiday and shall be held at the office of the company or at some other place within the city in which the Registered Office of the Company is situated as the Board may determine and the notices calling the Meeting specify as the Annual General Meeting. The company may in any one Annual General Meeting fix the time for its subsequent Annual General Meeting. Every member of the company shall be entitled to attend either in person or by proxy and the Auditors of the company shall have the right to attend and to be heard at any General Meeting, which he attends on any part of the business, which concerns him as Auditor. At every Annual General Meeting of the company there shall be laid on the table the Director’s Report and Audited Statement of Accounts, the Proxy Register with proxies and the Register of Director’s Share holding which Register shall remain open and accessible during the continuance of the Meeting.” Extra-ordinary General Meeting Article 83 provides that “All General Meetings other than Annual General Meetings shall be called Extra-ordinary General Meetings.” Requisitionists’ Meeting Article 84 provides that “(1) Subject to the provisions of Section 188 of the Act, the Directors shall on the requisition in writing of such number of members as hereinafter specified and (unless the General Meeting otherwise resolves) at the expense of requisitionists: (a) give to the members of the Company entitled to receive notice of the next Annual General Meeting, notice of any resolution, which may properly be moved and is intended to be moved at the meeting.

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(b) circulate to members entitled to have notice of any general meeting sent to them, any statement of not more than one thousand words with respect to the matter referred to in any proposed resolution or any business to be dealt with at the meeting. (2) The number of members necessary for a requisition under clause (1) hereof shall be (a) Such number of members as represent not less than one-twentieth of the total voting power of all the members having at the date of the resolution a right to vote on the resolution or business to which the requisition related; or (b) not less than one hundred member having the rights aforesaid and holding shares in the Company on which there has been paid up an aggregate sum of not less than rupees one lakh in all. (3) Notice of any such resolution shall be given and any such statement shall be circulated to members of the Company entitled to have notice of the meeting sent to them by serving a copy of the resolution or statement on each member in any manner permitted by the Act for service of notice of the meeting and notice of any such resolution shall be given to any other member of the Company be giving notice of the general effect of the resolution in any manner permitted by the Act, for giving him notice of meeting of the Company. The copy of the resolutions shall be served or notice of the effect of the resolution shall be given, as the case may be , in the same manner and so far as practicable, at the same time as notice of the meeting and where it is not practicable for it to be served or given at that time, it shall be served or given as soon as practicable thereafter. (4) The Company shall not be bound under this Article to give notice of any resolution or to circulate any statement unless: (a) a copy of requisition signed by the requisitionists (or two or more copies which between them contain the signature of all the requisitionists) is deposited at the registered office of the Company. (i) in the case of requisition, requiring notice resolution, not less than six weeks before the meeting; (ii) in the case of any holder requisition, not less than two weeks before the meeting; and (b) there is deposited or tendered with the requisition sum reasonably sufficient to meet the Company expenses in giving effect thereto. PROVIDED THAT if after a copy of the requisition requiring notice of a resolution has been deposited at the registered office of the Company and an Annual General Meeting is called for a date of six weeks or less after such copy has been deposited, the copy although not deposited within the time required by this clause, shall be deemed to have been properly deposited for the purposes also thereof. (5) The Company shall also not be bound under this Article to circulate any statement if, on the application either of the Company or of any other person who claims to be aggrieved is satisfied that the rights conferred by this Article are being abused to secure needless publicity for defamatory matter. (6) Notwithstanding anything in these Articles, the business which maybe dealt with at an Annual General Meeting shall include any resolution of which notice is given in accordance with this Article and for the purposes of this clause, notice shall be deemed to have been so given, notwithstanding the accidental commission, in giving it, to one or more members.” Extra-ordinary General Meeting by Board and by requisition Article 85 (a) provides that “The Directors may, whenever they think fit, convene an Extra-Ordinary General Meeting and they shall on requisition of the members as hereinafter provided, forthwith proceed to convene Extra-ordinary General Meeting of the Company.”

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When a Director or Any Two Members May Call an Extra-Ordinary General Meeting Article 85 (b) provides that “If at any time there are not within India sufficient Directors capable of acting to form a quorum or if the number of Directors be reduced in number to less than the minimum number of Directors prescribed by these Articles and continuing Directors fail or neglect to increase the number of Directors to that number or to convene a general meeting, any Director or any two or more members of the Company holding not less than one-tenth of the total paid up share capital of the Company may call an Extra-Ordinary General Meeting in the same manner as nearly as possible as that in which meeting may be called by the Directors.” Quorum Article 92 provides that “Five members entitled to vote and present in person shall be quorum for General Meeting and no business shall be transacted at the general meeting unless the quorum requisite be present at the commencement of the meeting. A body corporate being a member shall be deemed to be personally present if it is represented in accordance with Section 187 of the Act. The President of India or the Governor of a State being a member of the Company shall be deemed to be personally present if he is presented in accordance with Section 187A of the Act.” If quorum not present when meeting to be dissolved and when to be adjourned Article 93 provides that “If within half an hour from the time appointed for holding a meeting of the Company a quorum is not present, the meeting if called by or upon the requisition of members shall stand adjourned to the same day in the next week or if that day is a public holiday until the next succeeding day which is not a public holiday at the time and place or to such other day and at such other time and place as the Board may determine. If at the adjourned meeting also a quorum is not present with half an hour from the time appointed for holding the meeting, the members present shall be quorum and may transact the business for which the meeting was called.” Resolutions passed at adjourned meeting Article 94 provides that “Where a resolution is passed at an adjourned meeting of the Company, the resolution for all purposes, be treated as having been passed on the date on which it was in fact passed and shall not be deemed to have been passed on any earlier date.” Chairman of General Meeting Article 95 provides that “At every General Meeting the Chair shall be taken by the Chairman of the Board of Directors. If at any meeting, the Chairman of the Board of Directors be not present within ten minutes after the time appointed for holding the meeting or though present, be unwilling to act as Chairman, the Vice-Chairman of the Board of Directors would act as Chairman of the meeting and if Vice-Chairman of the Board of Directors be not present or though present, be unwilling to act as and in default of their doing so or if no Directors shall be present and willing to take the Chair, then the members present shall choose one of themselves, being a member entitled to vote to be Chairman. (a) Act for resolution sufficiently done or passed in General Meeting by ordinary resolution unless otherwise require. Any Act or resolution which, under the provisions of this Article or of the Act, is permitted or enquired to be done or passed by the Company in General Meeting shall be sufficiently so done or passed if effected by an ordinary resolution unless either the Act or the Articles specifically require such act to be done or resolution passed by a Special resolution.” Chairman's casting vote Article 102 provides that “In the case of equality of votes the Chairman shall both on a show of hands and a poll (if any) have a casting vote in addition to the vote or votes to which he may be entitled as a member.” Votes of Members

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Member paying money in advance no to be entitled to vote in respect thereof Article 106 provides that “A member paying the whole or a part of the amount remaining unpaid on any share held by him although on part of that amount has been called up, shall not entitled to any voting rights in respect of the moneys so paid by him until the same would but for such payment become presently payable.” Article 106A provides that “The Company may pass a resolution by postal ballot in the manner prescribed by Section 192A of the Act and such other applicable provisions of the Act. Notwithstanding anything contained in the provisions of the Act, the Company, being a listed Company, may, and in the case of resolutions relating to such business as the Central Government may be notification declare to be conducted only by postal ballot, shall get any resolution passed by means of a postal ballot instead of transacting the business in a general meeting of the Company.” Restriction on exercise of voting rights of members who have not paid calls Article 107 provides that “No member shall exercise any voting rights in respect of any shares registered in his name on which any calls or other sums presently payable by him have not been paid or in regard to which the Company has exercised any right of lien.” Number of votes to which member entitled Article 108 provides that “Subject to the provisions of Article 106 every member of the Company, holding any equity share capital and otherwise entitled to vote shall, on a show of hands when present in person (or being a body corporate present by a representative duly authorised) have one vote on a poll, when present (including a body corporate by a duly authorised representative) or by an agent duly authorised under a Power of Attorney or by proxy, his voting right shall be in proportion to his share of the paid-up equity share capital of the Company. Provided however, if any preference share-holder be present at any meeting of the Company, save as provided in clause (b) of such-section(2) of Section 87, he shall have a right to vote only on resolutions before the meeting which directly affect the rights attached to his preference shares. A member is not prohibited from exercising his voting rights on the ground that he has not held his shares or interest in the Company for any specified period proceeding the date on which the vote is taken.” Voting in person or by proxy Article 113 provides that “Subject to the provisions of these Articles, vote may be given either personally or by proxy. A body corporate being a member may vote either by a proxy or by a representative duly authorised in accordance with Section 187 of the Act.” Proxies Article 115 provides that “Any member of the Company entitled to attend and vote at a meeting of the Company shall be entitled to appoint another person (whether a member or not) as his proxy to attend and vote instead of himself PROVIDED ALWAYS that a proxy so appointed shall not have any right whatever to speak at the meeting. Every notice convening a meeting of the Company shall state that a member entitled to attend and vote is entitled to appoint one or more proxies.” Chairman of any meeting to be the judge of validity of any vote Article 122 provides that “The Chairman of any meeting shall be the sole judge of the validity of every vote tendered at such meeting. The Chairman present at the taking of a poll shall be the sole judge of the validity of every vote tendered at such poll. The decision of the Chairman shall be final and conclusive.” Directors

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Number of Directors Article 124 provides that “Until otherwise determined by a General Meeting of the Company and subject to the provisions of Section 252 of the Act, the number of Directors shall not be less than three and not more than twelve.” Debenture Directors Article 126 provides that “Any Trust Deed for securing debentures or debenture-stocks, may, if so arranged, provide for the appointment, from time to time by the Trustees thereof or by the holders of debentures or debenture-stocks, of some person to be a Director of the Company and may empower such Trustees or holder or debentures or debenture-stocks, from time to time, to remove and re-appoint any Director so appointed. The Director appointed under Article is herein referred to as "Debenture Director" and the term "Debenture Director" means the Director for the time being in office under this Article. The Debenture Director shall be liable to retire by rotation or be removed by the Company. The Trust Deed may contain such ancillary provisions as may be arranged between the Company and the Trustees and all such provisions shall have effect notwithstanding any of the other provisions herein contained.” Corporation Directors Article 127 provides that “Any bond or any other writing giving security issued or executed by the company in favour of any Credit Corporation or any agreement executed by the company in favour of a Credit Corporation may provide for the appointment of a Director (in these presents referred to as "The Corporation Directors") for and on behalf of the holder of such bonds of such Credit Corporation for such period as therein provided for not exceeding the period for which any amount may be outstanding under such bond or writing or agreement and for removal from the office of such Director and on a casual vacancy being caused whet her by resignation, death removal or otherwise, for the appointment of another Director in the vacant place. The Corporation Director shall not be liable to retire by rotation and subject to the provisions of the Act be removed from his office by the company.” Nominee Director Article 128 provides that “(a) Notwithstanding anything to the contrary contained in these Articles, so long as any moneys remain owning by the Company to Bank, Industrial Finance Corporation of India(IFCI),Industrial Credit and Investment Corporation of India Limited(ICICI) The Industrial Development Bank of India (IDBI) or to any other Financing Company or so long as IFCI, ICICI, IDBI or any other Financing Corporation or any other Financing Company or Body (each of which IFCI, ICICI, IDBI or any other Finance Corporation or Credit Corporation or any other Financing Company or Body is hereinafter in this Article referred to as "the Corporation") continued to hold debentures in the Company as a result of underwriting or by direct subscription or private placement or so long as the Corporation holds shares in the Company as result of underwriting or direct subscription or so long as any liability of the Company arising out of any guarantee furnished by the Corporation on behalf of the Company remains outstanding the Corporation shall have a right to appoint from time to time any person or persons as a Director or Directors, Whole-time or non-Whole-time (which Director or Directors is/are hereinafter referred to as "Nominee Director/s") on the Board of the Company and to the Company and to remove from such office any person or persons so appointed and to appoint any person or persons in his or their place/s. (b) The Board of Directors of the Company shall have no power to remove from office the Nominee Director/s. At the option of the Corporation, such Nominee Director/s shall not be required to hold any share qualification in the Company. Also at the option of the Corporation, such Nominee Director/s shall not be liable to retirement by rotation, Subject as aforesaid the Nominee Director/s shall be entitled to the same rights and privileges and be subject to the same obligation as any other Director of the Company. (c) The Nominee Director/s so appointed shall hold the said office only so long as moneys remained owing by the Company to the Corporation or so long as the Corporation or private placement or so long as the Corporation holds shares in the Company as a result of underwriting or direct subscription or liability of the company arising

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out of any guarantee is outstanding and the Nominee Director/s so appointed in exercise of the said power shall ipso facto vacate such office immediately on the moneys owing by the Company to the Corporation is paid off or on the Corporation shall ceasing to hold debentures/shares in the Company or on the satisfaction of the liability of the Company arising out of any guarantee furnished by the Corporation. (d) The Nominee Director/s appointed under this Article shall be entitled to receive all notices of and attend all General Meeting, Board meetings or the Committee of which the Nominee Director/s is/are member/s as also the minutes of such meetings. The Corporation shall also be entitled to receive all such notice and minutes. (e) The Company shall pay to the Nominee Director/s sitting fees and expenses which the other Directors of the Company are entitled but if any others fees, commission, moneys or remuneration in any other form is payable to the Directors of the Company. The fees, commission, moneys, remuneration in relation to such Nominee Director/s shall accrue to the Corporation and same shall accordingly be paid by the company directly to the Corporation Any expenses that may be incurred by the Corporation or such Nominee Director/s in connection with their appointment or Directorship shall also be paid or reimbursed by the Company to the Corporation or as the case may be to such Nominee Director/s. Provided that if any such Nominee Director/s is an officer of the Corporation , the sitting fees in relation to such Nominee Director/s shall also accrue to the Corporation and the same shall accordingly be paid by the Company directly to the Corporation. (f) Provided also that in the event of the Nominee Director/s being appointed as whole time Director/s such Nominee Director/s shall exercise such power and duties as may be approved by the Lenders and have such rights as are usually exercised or available to a whole time Director, in the management of the affairs of the Borrower and such Nominee Director/s shall be entitled to receive any remuneration, fees, commission and moneys as may be approved by the Lenders.” Limit on number of non-retiring Directors Article 129 provides that “The provisions of Articles 124, 125 and 126 are subject to the provisions of Section 256 of the Act and number of such Directors appointed under Article 132 shall not exceed in the aggregate one-third of the total number of Directors for the time being in office.” Qualification of shares Article 133 provides that “A Director need not hold any qualification shares.” Director's sitting fees Article 134 provides that “The fees payable to a Director for attending Board Meeting shall be such sum as may be prescribed under Section 310 of the Act or may be prescribed by the Central Government from time to time for each of the meetings of the Board or a Committee thereof and adjournments thereto attended by him. The Directors, subject to the sanction of the Central Government (if any required), may be paid such higher fees as the company in General Meeting shall from time to time determine.” Extra remuneration to Directors for special work Article 135 provides that “Subject to the provisions of Section 198, 309,310,311 and 314 of the Act, if any Director, being willing shall be called, upon to perform extra services (which expression shall include work done by a Director as a member of any committee formed by the Directors or in relation to signing Share Certificates) or to make special exertions in going or residing out of his usual place of residence or otherwise for any of the purposes of the Company, the Company shall remunerate the Director so doing either by a fixed sum or otherwise as may be determined by the Directors and such remuneration may be either in addition to or in substitution for his share in the remuneration above provided. The Directors (other than the Managing Director or any other Whole-time paid Director) shall also be entitled to further remuneration by way of commission at the rate of 1 per cent of the net profits of the company calculated in accordance with the provisions of the Companies Act, 1956 and such remuneration shall be divided among the Directors (other than the Managing Director or Whole-time paid

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Directors) in such proportion and manner as may be agreed upon between them and the Board of Directors and in the absence of agreement, equally.” Directors and Managing Director may contract with company Article 138 provides that “Subject to the provisions of the Act, the Directors (including a Managing Director and Whole-time Director) shall not be disqualified by reason of his or their office as such from holding office under the company or form contracting with the company either as vendor, purchaser, lender, agent, broker, lessor or lessee or otherwise, nor shall any such contract or any contract or arrangement entered into by or on behalf of the company with any Director or with any company or partnership, of or in which any Director shall be member or otherwise interested be avoided, nor shall any Director so contracting or being such member or so interested be liable to account to the company for any profit realised by such contract or arrangement by reason only of such Director holding that office or of the fiduciary relation thereby established, but it is declared that the nature of his interest shall be disclosed as provided by Section 299 of the Act and in this respect all the provisions of Sections 300 and 301 of the Act shall be duly observed and complied with.” Rotation and Appointment of Directors Rotation of Directors Article 139 provides that “Not less than two-thirds of the total number of Director shall (a) be persons whose period of the office is liable to termination by retirement of Directors by rotation and (b) save otherwise expressly provided in the Articles be appointed by the company in General Meeting.” Retirement of Directors Article 140 provides that “Subject to the provisions of Articles 129 the non-retiring Directors should be appointed by the Board for such period or periods as it may in its discretion deem appropriate.” Retirement of Directors Article 141 provides that “Subject to the provisions of Section 256 of the Act and Articles 129 at every Annual General Meeting of the Company, one-third of such of the Directors for the time being as are liable to retire by rotation or if their number is not three or a multiple of three the number nearest to one-third shall retire from office. The Debenture Directors, Nominee Directors, Corporation Directors, subject to Articles 126,127,128 and 146 Managing Directors, if any, shall not be subject to retirement under this Article and shall not be taken into account in determining the number of Directors to retire by rotation. In these Articles, a "Retiring Director" means a Director retiring by rotation.” Eligibility for re-election Article 143 provides that “A retiring Director shall be eligible for re-election and shall act as a Director throughout and till the conclusion of the meeting at which he retires.” Managing Director Power to appoint Managing Director Article 146 provides that “Subject to the provisions of Sections 267, 268, 269, 316 and 317 of the Act, the Board may, from time to time, appoint one or more Directors to be Managing Director or Managing Directors or Whole-time Directors of the Company, either for a fixed term of five years as to the period for which he or they is or are to hold such office and may, from time to time (subject to the provisions of any contract between him or them and the company) remove or dismiss him or them from office and appoint another or others in his or their place or places.”

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Proceedings of the Board of Directors Article 150 provides that “The Directors may meet together as a Board for the dispatch of business from time to time unless the Central Government by virtue of the provision of Section 285 of the Act otherwise directs, shall so meet at least once in every three months and at least four such meetings shall be held in every year. The Directors may adjourn and otherwise regulate their meetings as they think fit. The provision of this Article shall not be deemed to have been contravened merely by reason of the fact that the meeting of the Board which had been called in compliance with the terms of this Article could not be held for want of a quorum.” Quorum Article 151 provides that “(a) Subject to Section 287 of the Act, the quorum for a meeting of the Board of Directors shall be one-third of its total strength (excluding Directors, if any, whose place may be vacant at the time and any fraction contained in that one-third being rounded off as one) or two Directors whichever is higher. PROVIDED THAT where at any time the number of interested Directors at any meeting exceeds or is equal to two-third of the total strength, the number of the remaining Directors (that is to say, the number of remaining who are not interested) present at the meeting being not less than two shall be the quorum during such time. (b) For the purpose of clause (a): (i) “Total Strength” means total strength of the Board of Directors of the Company determined in pursuance of the Act, after deducting therefrom number of the Directors, if any, whose place may be vacant at the time; and (ii) “Interested Directors” means any Director whose presence cannot, by reason of any provisions in the Act, count for the purpose of forming a quorum at a meeting of the Board, at the time of the discussion or vote or any matter. Chairman of Meeting Article 153 provides that “(a) The Directors from time to time elect one of their number to be the Chairman and one to be the Vice-Chairman, if required of the Board of Directors and determine the period for which they have to hold such office, but if no such Chairman or Vice-Chairman is elected, the Directors present shall choose one of their number to be the Chairman of such meeting. (b) The Chairman of the Board of Directors shall be the Chairman of the Meeting of Directors and shall also preside over all General Meetings of the company. Provided that if the Chairman of the Board of Directors is not present, the Vice-Chairman of the Board of Directors shall preside the meeting and if the Vice-Chairman of the Board of Directors is also not present, the Directors present shall choose one of their number to be the Chairman of such meeting.” Questions at Board Meeting how decided Article 154 provides that “Subject to the provisions of Sections 316, 375(5) and 386 of the Act, questions arising at any meeting of the Board shall be decided by a majority of votes and in case of any equality of votes, the Chairman shall have a second or casting vote.” Powers of Board Meeting Article 155 provides that “A meeting of the Board of the Directors for the time being at which a quorum is present shall be competent to exercise all or any of the authorities, powers and discretion which by or under the Act or these Articles or the regulations for the time being of the Company are vested in or exercisable by the Board of Directors generally. Directors may appoint committee

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Article 156 provides that “The Board of Directors may subject to the provisions of Section 292 and other relevant provisions of the Act or these Articles, delegate any of the powers other than the powers to make calls and to issue debentures to such committee or committees and may from time to time revoke and discharge any such committee of the Board either wholly or in part and either as to the persons or purposes, but every committee of the Board so formed shall in exercise of the powers so delegated conform to any regulation that may from time to time be imposed on it by the Board of Directors. All acts done by any such committee of the Board in conformity with such regulations and in fulfillment of the purpose of their appointments, but not otherwise, shall have the like force and effect, as if done by the Board.” Powers of the Board General Powers of Management vested in Directors Article 160 provides that “The business of the Company shall be managed by the Directors who may exercise all such powers of the Company and do all such acts and things as are not by the Act or any other Act or by the Memorandum or by the Articles of Company required to be exercised by the Company in General Meeting, subject nevertheless to any regulation of these Articles or the provisions of the Act or any other Act and to such regulation being not inconsistent with the aforesaid regulations or provisions as may be prescribed by the Company in General Meeting but no regulations made by the Company in General Meeting shall invalidate any prior act of the Directors which would have been valid if that regulation had not been made, provided that the Board of Directors shall not except with the consent of the Company in General Meeting : (a) Sell, lease or otherwise dispose off the whole or substantially the whole of the undertaking of the Company or where the Company owns more than one undertaking, of the whole or substantially the whole of any such undertaking; (b) Remit or give time for the payment of any debt due by a Director (c) Invest, otherwise than in trust securities, the amount of compensation received by the Company in respect of the compulsory acquisition, of any such undertaking as is referred to in clause (a) or of any premises or properties used for any such undertaking and without which it cannot be carried on or can be carried on only with difficulty or only after a considerable time; (d) Borrow moneys, where moneys to be borrowed, together with the money already borrowed by the Company (apart from temporary loans obtained from the Company's bankers in the ordinary course of business) will exceed the aggregate of the paid up capital of the Company and its free reserves, that is to say, reserves not set apart for any specific purpose; or (e) Contribution to charitable and other funds not directly relating to the business of the Company or the welfare of its employees any amounts the aggregate of which will, in any financial year, exceed fifty thousand rupees or five per cent of its average net profits as determined in accordance with the provisions of Sections 349 and 350 of the Act during the three financial years immediately preceding, whichever is greater, provided that the Company in General Meeting or the Board of Directors shall not contribute any amounts to any political party or for any political purpose to any individual or body; (i) Provided that in respect of the matter referred to in clause (d) and (e), such consent shall be obtained by a resolution of the Company which shall specify the total amount upto which moneys may be borrowed by the Board under clause (d) or as the case may be, total amount which may be contributed to charitable or other funds in any financial year under clause (e). (ii) Provided further that the expression "temporary loans" in clause (d) above shall mean loans repayable on demand or within six months from the date of the loan such as short term cash credit arrangements, the discounting of bills and the issue of other short term loans of a seasonal character, but does not include loans raised for the purpose of financing expenditure of a capital nature.”

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Certain powers to be exercised by the Board only at meeting. Article 161 provides that “(1) Without derogating from the powers vested in the Board of Directors under these Articles, the Board shall exercise the following powers on behalf of the Company and they shall do so only by means of resolutions passed at the meeting of the Board : (a) The power to make calls on shareholders in respect of moneys unpaid on their shares; (b) The power to issue debentures ; (c) The power to borrow moneys otherwise than on debentures ; (d) The power to invest the funds of the Company; and (e) The power to make loans. Provided that the Board may, by resolution passed at a meeting, delegate to any committee of Directors, the Managing Director or any other principal officer of the Company, the powers specified in sub-clauses (c), (d) and (e) to the extent specified below. (2) Every resolution delegating the power referred to in sub-clause (1)(c) shall specify the total amount outstanding at any one time, upto which money may be borrowed by the delegate. (3) Every resolution delegating the power referred to in sub-clause (1)(d) shall specify the total amount upto which the funds of the Company may be invested and the nature of the investments which may be made by the delegate. (4) Every resolution delegating the power referred to in sub-clause (1)(e) shall specify the total amount upto which loans may be made by the delegate, the purpose for which the loans may be made and the maximum amount of loans which may be for each such purpose in individual cases.” Certain powers of the Board Article 162 provides that “Without prejudice to the general powers conferred by the last preceding Article and so as not in any way to limit or restrict those powers and without prejudice to the other powers conferred by these Articles but subject to the restrictions contained in the last preceding Articles, it is hereby declared that the Directors shall have the following powers, that is to say, power : (1) To pay the costs, charges and expenses preliminary and incidental to the formation, promotion, establishment and registration of the Company. (2) To pay and charge to the Capital Account of the Company any commission or interest, lawfully payable thereout under the provisions of Sections 76 and 208 of the Act. (3) Subject to Sections 292 and 297 and other applicable provisions of the Act, to purchase or otherwise acquire for the Company any property, rights or privileges which the Company is authorised to acquire at or for such price or consideration and generally on such terms and conditions as they may think fit in any such purchase or other acquisition, accept such title as the Director may believe or may be advised to be reasonably satisfactory. (4) At their discretion and subject to the provisions of the Act, to pay for any property, rights or privileges by or services rendered to the Company, either wholly or partially in cash or in shares, bonds, debentures, mortgages or other securities of the Company and any such shares may be issued either as fully paid up or with such amount credited as paid up thereon as may be agreed upon and any such bonds, debentures, mortgages or other securities as may be either specifically charged upon all or any part of the property of the Company and its uncalled capital or not so charged.

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(5) To secure the fulfillment of any contracts or engagements entered into by the Company by mortgage or charge of all or any of the property of the Company and its uncalled capital for the time being or in such manner as they may think fit. (6) To accept from any member, so far as may be permissible by law, a surrender of his shares or any part thereof, on such terms and conditions as shall be agreed. (7) To appoint any person to accept and hold in trust for the Company property belonging to the Company or in which it is interested or for any other purposes and to execute and to do all such deeds and things as may be required in relation to any such trust and to provide for the remuneration of such trustee or trustees. (8) To institute, conduct, defend, compound or abandon any legal proceedings by or against the Company or its officer or otherwise concerning the affairs of the Company and also to compound and allow time for payment on satisfaction of any debts due and of any claim or demands by or against the Company and to refer any difference to arbitration and observe the terms of any awards made therein either according to Indian Law or according to Foreign Law and either in India or abroad and observe and perform or challenge any award made therein. (9) To act on behalf of the Company in all matters relating to bankruptcy, insolvency, winding up and liquidation of Companies. (10) To make and give receipts, release and other discharge for moneys payable to the Company and for the claims and demands of the Company. (11) Subject to the provisions of Sections 291(1), 295, 370 and 372 and other applicable provisions of the Act and these Articles, to invest and deal with any moneys of the Company not immediately required for the purpose thereof, upon such security (not being the shares of this Company) or without security and in such manner as they may think fit and from time to vary or realise such investment. Save as provided in Section 49 of the Act, all investments shall be made and held in the Company's own name. (12) To execute in the name and on behalf of the Company in favour of any Director or other person who may incur or be about to incur any personal liability whether as principal or surety, for the benefit of the Company, such mortgage of the Company's property (present and future) as they think fit and any such mortgage may contain a power of sale and other powers, provisions, covenants and agreements as shall be agreed upon. (13) To open bank accounts and to determine from time to time who shall be entitled to sign, on the Company's behalf, bills, notes, receipt, acceptance, endorsements, cheques, dividend warrants, release, contracts and documents and to give the necessary authority for such purposes. (14) To distribute by way of bonus amongst the staff of the Company a share or shares in the profits of the Company and do give to any Director, officer or other person employed by the Company a commission on the profits of any particular business and or transaction and to charge such bonus or commission as part of working expenses of the Company. (15) To provide for the welfare of Directors or Ex-Directors or employees or ex-employees of the Company and the wives, widows and families of the dependents or connections of such persons by building or contributing to the building of houses, dwellings or chawls or by grants of money, pension, gratuities, allowances, bonus or other payments or by creating and from time to time, subscribing or contributing to provident and other associations, institutions and by providing or subscribing or contributing towards places of interests and recreation, hospitals, dispensaries, medical and other attendance and other assistance as the Board shall think fit and subject to the provisions of Section 293(1)(e) of the Act, to subscribe or contribute or otherwise to assist or to guarantee money to charitable, benevolent, religious, scientific, national or other institutions or objects which shall have any moral or other claim to support or aid by the Company either by reason of locality of operation or the public and general utility or otherwise.

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(16) Before recommending any dividend, to set aside, out of the profits of the Company, such sums as they may think proper for depreciation or the depreciation fund or to an insurance fund or as a reserve fund or sinking fund or any special or other fund or funds or account or accounts to meet contingencies or to repay redeemable preference shares, debentures or debenture-stock or for special dividends or for equalising dividends for repairing, improving, extending and maintaining any part of the property of the Company and such other purposes (including the purposes referred to in the preceding clause) as the Board may, in their absolute discretion think conducive to the interest of the company and subject to Section 292 of the Act, to invest the several sums so set aside or so much thereof as required to be invested, upon such investments (other than share of this Company) as they may think fit and from time to time to deal with and vary such investments and dispose off and apply and expend all or any part thereof for the benefit of the Company, in such manner and for such purposes as the Board in their absolute discretion think conducive to the interest of the Company notwithstanding that the matters to which the Board apply or upon which they expend the same or any part thereof or upon which the capital moneys of the Company might rightly be applied or expended and to divide the General Reserve or Reserve Fund into such special funds as the Board may think fit with full power to transfer the whole or any portion of a Reserve Fund to another Reserve Fund and/or division of a Reserve Fund and with full power to employ the assets constituting all or any of the above funds including the depreciation fund in the business of the Company or in purchase or repayment of redeemable preference shares, debentures or debenture-stock and without being bound to keep the same separate from the other assets and without being bound to pay interest on the same with power however to the Board at their discretion to pay or allow to the credit of such funds interest at such rate as the Board think proper. (17) To appoint and at their discretion remove or suspend such general managers, managers, secretaries, assistants, supervisors, scientists, technicians, engineers, consultants, legal, medical or economic advisers, research workers, labourers, clerks, agents and servants for permanent, temporary or special services as they may from time to time think fit and to determine their powers and duties and to fix their salaries or emoluments or remuneration and acquire security in such instances and to such amounts as they may think fit and also from time to time provide for the management and transactions of the affairs of the company in any specified locality in India or elsewhere in such manner as they think fit. (18) From time to time and at any time to establish any local Board for managing of the affairs of the Company in any specified locality in India or elsewhere and to appoint any person to be members of such local Board or managers or agencies and to fix their remuneration. (19) Subject to Section 292 of the Act, from time to time and at any time, to delegate to any persons so appointed any of the powers, authorities and discretion for the time being vested in the Board, other than their powers to make calls or to make loans or borrow moneys and to authorise the members for the time being of such local Board or any of them to fill up any vacancies therein and to act notwithstanding vacancies and such appointment or delegation may be made on such terms subject to such conditions as the Board may think fit and the Board may at any time remove any person so appointed and may annul or vary any such delegation. (20) At any time and from time to time by power of Attorney under the Seal of the Company, to appoint any person or persons to be the Attorney or Attorneys of the Company, for such purposes and with such powers, authorities and discretion (not exceeding those vested in or exercisable by the Board under these presents and excluding the power to make calls and excluding also, except in their limits authorised by the Board, the power to make loans and borrow moneys) and for such period and subject to such conditions as the Board may from time to time think fit and any such appointments may (if the Board thinks fit) be made in favour of the members of any local Board established as aforesaid or in favour of any Company or the shareholders, Directors, Nominees or Managers of any Company or firm or otherwise in favour of any fluctuating body or persons whether nominated directly or indirectly by the Board and any such power of Attorney may contain such powers for the protection of convenience of persons dealing with such Attorneys as the Board may think fit and may contain powers enabling any such delegating Attorneys as aforesaid to sub-delegate all or any of the powers, authorities and discretion for the time being vested in them. (21) Subject to Sections 294, 297, 300 and other applicable provisions of the Act, for or in relation to any of the matters aforesaid or otherwise for the purposes of the Company, to enter into all such negotiations and contracts

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and rescind and vary all such contracts and execute and do all such acts, deeds and things in the name and on behalf of the company as they may consider expedient. (22) From time to time make, vary and repeal bye-laws for the regulations of the business of the Company, its officers and servants. (23) To purchase or otherwise acquire any lands, buildings, machinery, premises, hereditaments, property, effects, assets, rights, credits, royalties, business and goodwill of any Joint Stock Company carrying on the business which the Company is authorised to carry on in any part of India. (24) To purchase, take on lease for any term of years or otherwise acquire any factories, or any land or lands, with or without buildings and out houses thereon, situate in any part of India, at such price or rent and under and subject to such terms and conditions as the Directors may think fit and in any such purchase, lease or other acquisition to accept such title as the Directors may believe or may be advised to be reasonably satisfactory. (25) To insure and keep insured against loss or damage by fire or otherwise for such period and to such extent as it may think proper all or any part of the buildings, machinery, goods, stores, produce and other movable property of the Company, either separately or co-jointly, also to insure all or any portion of the goods, produce, machinery and other articles imported or exported by the Company and to sell, assign, surrender or discontinue any policies of assurance effected in pursuance of this power. (26) To purchase or otherwise acquire or obtain license for the use of and to sell, exchange or grant license for the use of any trademark, patent, invention or technical know-how. (27) To sell from time to time any articles, materials, machinery, plants, stores and other articles and things belonging to the Company as the Board may think proper and to manufacture, prepare and sell waste and bye-products. (28) From time to time to extend any business any undertaking of the Company by adding, altering or enlarging all or any of the buildings, factories, workshops, premises, plant and machinery, for the time being the property of or in the possession of the Company or by erecting new or additional building and to expend such sum of money for the purpose aforesaid or any of them as may be thought necessary or expedient. (29) To undertake on behalf of the Company any payment of all rents and the performance of the convenants, conditions and agreements contained in or reserved by any lease that may be granted or assigned to or otherwise acquired by the Company and to purchase the reversion or reversions and otherwise to acquire the free hold simple of all or any of the lands of the Company for the time being held under lease or for an estate less than free hold estate. (30) To improve, manage, develop, exchange, lease, sell, resell and repurchase, dispose off, deal or otherwise turn to account, and property (movable or immovable) or any rights or privileges belonging to or at the disposal of the Company or in which the Company is interested. (31) To let, sell or otherwise dispose off, subject to the provisions of Section 293 of the Act and of the other Articles, any property of the Company, either absolutely or conditionally and in such manner and upon such terms and conditions in all respects as it thinks fit and to accept payment of satisfaction for the same in cash or otherwise as it thinks fit. (32) Generally, subject to the provisions of the Act and these Articles, to delegate the powers, authorise and discretion vested in the Directors to any person, firm, Company or fluctuating body of persons as aforesaid.” The Seal The Seal its custody and use

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Article 167 provides that “(a)The Board of Directors shall provide a Common Seal for the purpose of the Company and shall have power from time to time to destroy the same and substitute a new seal in lieu thereof and the Board shall provide for the safe custody of the Seal for the time being, under such regulations as the Board may prescribe. (b) The Seal shall not be affixed to any instrument except by the authority of the Board of Directors or a Committee of the Board previously given and in the presence of at least two Directors of the Company or at least one Director and Secretary or any other person duly authorised by the Board, both of whom shall sign every instrument to which the seal is affixed. Provided further that the certificates of shares or debentures shall be sealed in the manner and in conformity with the provisions of the Companies (Issue of Share Certificates) Rules, 1960 and their statutory modifications for the time being in force. Dividend Division of profits Article 168 provides that “(a) Subject to the rights of persons, if any, entitled to shares with special rights as to dividends, all dividends shall be declared and paid according to the amounts paid or credited as paid on the shares in respect whereof the dividend is paid but if and so long as nothing is paid upon any shares in the Company, dividends may be declared and paid according to the amounts of the shares. (b) No amount paid or credited as paid on a share in advance of calls shall be treated for the purpose of this regulation as paid on the shares.” The Company in General Meeting may declare dividends Article 169 provides that “The Company in General Meeting may declare dividends, to be paid to members according to their respective rights and interest in the profits and may fix the time for payment and the Company shall comply with the provisions of Section 207 of the Act, but no dividends shall exceed the amount recommended by the Board of Directors but the Company may declare a smaller dividend in General Meeting.” Dividend out of profits only Article 170 provides that “No dividend shall be payable except out of profits of the Company arrived at in the manner provided for in Section 205 of the Act.” Interim Dividend Article 171 provides that “The Board of Directors may from time to time pay to the members such interim dividends as in their judgment the position of the Company justifies.” Debts may be deducted Article 172(a) provides that “The Directors may retain any dividends on which the Company has a lien and may apply the same in or towards the satisfaction of the debts, liabilities or engagements in respect of which the lien exists.” Company may retain dividends Article 172(b) provides that “The Board of Directors may retain the dividend payable upon shares in respect of which any person is under the transmission Article entitled to become a member or which any person under that Article is entitled to transfer until such person shall become a member or shall duly transfer the same.“ No member to receive dividend whilst indebted to the Company and the Company’s right of reimbursement thereof

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Article 175 provides that “No member shall be entitled to receive payment of any interest or dividend or bonus in respect of his share or shares, whilst any money may be due or owing from him to the Company in respect of such share or shares (or otherwise however either alone or jointly with any other person or persons) and the Board of Directors may deduct from the interest or dividend to any member, all such sums of money so due from him to the Company.” Effect of Transfer of shares Article 176 provides that “A transfer of shares shall not pass the right to any dividend declared therein before the registration of the transfer.” Dividend to joint holders Article 177 provides that “Any one of several persons who are registered as joint holders of any share may give effectual receipts for all dividends or bonus and payments on account of dividends in respect of each shares.” Capitalisation Article 182 provides that “(1) The Company in General Meeting may, upon the recommendation of the Board, resolve: (a) that it is desirable to capitalize any part of the amount for the time being standing to the credit of the Company’s reserve accounts or to the credit of the profit and loss account or otherwise available for distribution; and (b) that such sum be accordingly set free for distribution in the manner specified in clause (2) amongst the members who would have been entitled thereto, if distributed by way of dividend and in the same proportions. (2) The sum aforesaid shall not be paid in cash but shall be applied, subject to the provision contained in clause (3) either in or towards: (i) paying up any amount for the time being unpaid on any shares held by such members respectively. (ii) paying up in full unissued shares of the Company to be allocated and distributed, credited as fully paid up to and amongst members in the proportions aforesaid; or (iii) partly in the way specified in such clause (i) and partly in that specified in sub-clause (ii). (3) A share premium account and a capital redemption reserve account may, for the purpose of this regulation, only be applied in the paying up of unissued shares to be issued to members of the Company as fully paid bonus shares. (4) The Board shall give effect to the resolution passed by the Company in pursuance of this regulation.” Fractional certificates Article 183 provides that “ (1) Whenever such a resolution as aforesaid shall have been passed, the Board shall (a) make all appropriations and applications of the undivided profits resolved to be capitalized thereby and all allotments and issues of fully paid shares and (b) generally do all acts and things required to give effect thereto (2) The Board shall have full power:

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(a) to make such provision, by the issue of fractional cash certificate or by payment in cash or otherwise as it think fit, in the case of shares becoming distributable in fractions, also (b) to authorise any person to enter, on behalf of all the members entitled thereto, into an agreement with the Company providing for the allotment to them respectively credited as fully paid up, of any further shares to which they may be entitled upon such capitalization or (as the case may require) for the payment by the Company on their behalf, by the application thereof of either respective proportions of the profits resolved to be capitalized of the amounts remaining unpaid on their existing shares. (3) Any agreement made under such authority shall be effective and binding on all such members. (4) That for the purpose of giving effect to any resolution, under the preceding paragraph of this Article, the Directors may give such directions as may be necessary and settle any question of difficulties that may arise in regard to any issue including distribution of new equity shares and fractional certificates as they think fit.” Accounts Article 184 provides that “ Books to be kept (1) The Company shall keep at its registered office proper books of account as would give a true and fair view to the state of affairs of the Company or its transaction with respect to: (a) all sums of money received and expended by the Company and the matters in respect of which the receipt and expenditure take place; (b) all sales and purchases of goods by the Company; (c) the assets and liabilities of the Company; and (d) if so required by the Central Government, such particulars relating to utilization of material or labour or other items of cost as may be prescribed by that Government. Provided that all or any of the books of account aforesaid may be kept at such other place in India as the Board of Directors may decide and when the Board of Directors so decides, the Company shall, within seven days of the decision file with the Registrar a notice in writing giving the full address of that other place. (2) Where the Company has branch office, whether in or outside India, the Company shall be deemed to have complied with the provisions of clause (1) if proper books of account relating to the transactions effected at the branch are kept at that office and proper summarised returns, made upto date at intervals of not more than three months, are sent by the branch office to the Company at its registered office or the other place referred to in clause (1). The books of account and other books and papers shall be open to inspection by any Director during business hours.” Accounts to be audited Article 187 provides that “Once at least in every year the accounts of the Company shall be examined, balanced and audited and the correctness of the Profit and Loss Account and Balance Sheet ascertained by one or more Auditor or Auditors.” Winding Up Distribution of Assets Article 195 provides that “If the Company shall be wound up and the assets available for distribution among the members as such shall be insufficient to repay the whole of the paid up capital, such assets shall be distributed so that as nearly as may be the losses shall be borne by the members in the proportion to the capital paid up or which

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ought to have been paid up at the commencement of winding up on the shares held by them respectively and if in the winding up, the assets available for distribution among the members shall be more than sufficient to repay the whole of the capital paid at the commencement of the winding up, the excess shall be distributed amongst members in proportion to the capital at the commencement of the winding up, paid up or which ought to have been paid up on the shares held by them respectively. But this article is to be without prejudice to the rights of the holders of shares issued upon special terms and conditions.” Distribution in specie or kind Article 196 provides that “(a) If the Company shall be wound up, whether voluntarily or otherwise, the liquidator may, with the sanction of a special resolution, divide amongst the contributories in specie or kind, any part of the assets of the Company and may with the like sanction vest any part of the assets of the Company in Trustees upon such trusts for the benefit of the contributories or any of them as the Liquidator, with the like sanction, shall think fit. (b) If thought expedient any such division may subject to the provisions of the Act be otherwise than in accordance with the legal rights of the contributories (except where unalterably fixed by the Memorandum of Association) and in particular any class may be given preferential or special rights or may be excluded altogether or in part but in case any division otherwise than in accordance with the legal rights of the contributories, shall be determined on any contributory who would be prejudicial thereby shall have a right to dissent any ancillary rights as if such determination were a special resolution passed pursuant to Section 494 of the Act. (c) In case any shares to be divided as aforesaid involve a liability to calls or otherwise, any person entitled under such division to any of the said shares may within ten days after the passing of the special resolution by notice in writing direct the liquidator to sell his proportion and pay him the net proceeds and the liquidator shall, if practicable, act accordingly.” Directors and other’s right to indemnity Article 197 provides that “Subject to the provisions of Section 201 of the Act, every Director or officer or servant of the Company or any person (whether an officer of the Company or not) employed by the Company as auditor, shall be indemnified by the Company against and it shall be the duty of the Directors out of the funds of the Company, to pay all costs, charges, losses and damages which any such person may incur or become liable to by reason of any contract entered into or any act, deed, matter or thing done, concurred in or omitted to be done by him in any way in or about the execution or discharge of his duties or supposed duties (except such, if any, as he shall incur or sustain through or by his own wrongful act, neglect or default including expenses and in particular and so as not to limit the generality of the foregoing provisions against all liabilities incurred by him as such Director, Officer or Auditor or other Officer of the Company in defending any proceedings whether civil or criminal in which judgement is given in his favour or in which he is acquitted or in connection with any application under Section 633 of the Act in which relief is granted to him by the Court.” Director, Officer not responsible for acts of others Article 198 provides that “Subject to the provisions of Section 201 of the Act, no Director, Auditor or other Officer of the Company shall be liable for the acts, receipts, neglects or defaults of any other Director or Officer or for joining in any receipt or other act for conformity or for any loss or expenses happening to the Company through the insufficiency or deficiency of title to any property acquired by order of the Directors for or on behalf of the Company or for the insufficiency or deficiency of any security in or upon which any of the money of the Company shall be invested or for any loss or damages arising from the insolvency or tortuous act of any person, firm or Company to or with whom any moneys, securities or effects shall be entrusted or deposited or any loss occasioned by any error of judgement, omission, default or oversight on his part or for any other loss, damage or misfortune whatever shall happen in relation to execution of the duties of his office or in relation thereto unless the same shall happen through his own dishonesty.” Secrecy Clause

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Article 199 provides that “Every Director, Manager, Auditor, Treasurer, Trustee, Member of a Committee, Officer, servant, Agent, Accountant or other person employed in the business of the Company shall, if so required by the Director, before entering upon his duties, sign a declaration pledging himself to observe a strict secrecy respecting all transactions and affairs of the Company with the customers and the state of the accounts with individuals and in matter thereto and shall, by such declaration pledge himself not to reveal any of the matters which may come to his knowledge in the discharge of his duties, except when required to do so by the directors or by law or by the person to whom such matters relate and except so far as may be necessary in order to comply with any of provisions in these presents contained.” No member to enter the premises of the Company without permission Article 200 provides that “No member or other person (not being a Director) shall be entitled to visit or inspect any property or premises of the Company without the permission of the Board of Directors or Managing Director or to inquire discovery of or any information respecting any details of the Company’s trading or any matter which is or may be in the nature of the trade secret, mystery of trade, secret process or any other matter which relate to the conduct of the business of the Company and which in the opinion of the Directors, it would be inexpedient in the interest of the Company to disclose.”

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SECTION IX: OTHER INFORMATION

MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION

The copies of the following contracts which have been entered, or are to be entered into by our Company (not being contracts entered into in the ordinary course of business carried on by our Company or contracts entered into more than two years before the date of this Draft Letter of Offer) which are or may be deemed material have been attached to the copy of the Letter of Offer delivered to the RoC for registration. Copies of the abovementioned contracts and also the documents for inspection referred to hereunder, may be inspected at the Registered Office between 10 a.m. and 5 p.m. on all Working Days until the Bid/Issue Closing Date.

A. Material Contracts for the Issue

1. Engagement Letter dated July 25, 2012 between our Company and the LM.

2. Memorandum of Understanding dated July 27, 2012 between our Company and the LM. 3. Memorandum of Understanding dated July 26, 2012 between our Company and the Registrar to

the Issue.

B. Material Documents

1. Certified copies of the updated Memorandum and Articles of Association of our Company as amended.

2. Certificate of Incorporation dated October 5, 2009.

3. Prospectus of our Company dated November 21, 2000. 4. Consents of our Directors, Company Secretary and Compliance Officer, Auditors, Lead Manager

to the Issue, Bankers to the Issue, Lenders, Legal Counsel and the Registrar to the Issue to include their names in this Draft Letter of Offer to act in their respective capacities.

5. Resolution of our Board of Directors dated July 25, 2012 authorising the Issue and other related matters.

6. Resolution of our Board of Directors dated July 28, 2012, approving this Draft Letter of Offer.

7. Approval dated June 28, 2012 from the RoC for extending our financial year to September 30, 2012.

8. The Report of the Auditors being, B S R & Co. and Chaturvedi & Shah, as set out herein dated

July 25, 2012 in relation to the audited financial information of our Company.

9. Annual Reports of our Company for the Fiscal Years 2007, 2008, 2009, 2010 and 2011 taken on a standalone and consolidated basis.

10. The Statement of Tax Benefits dated July 25, 2012 from Jitendra Sanghavi & Co., Chartered Accountants.

11. Due Diligence Certificate dated July 28, 2012 addressed to SEBI from the LM. 12. In principle listing approvals dated [●] and [●] issued by BSE and NSE respectively. 13. Tripartite Agreement dated October 31, 2000 between our Company, NSDL and Registrar to the

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Issue. 14. Tripartite Agreement dated September 14, 2000 between our Company, CDSL and Registrar to

the Issue.

15. Letter no. [●] dated [●] issued by the SEBI for the Issue

16. The Service Agreement dated July 1, 2011 entered between our Company with Ashish Agarwal.

Any of the contracts or documents mentioned in this Draft Letter of Offer may be amended or modified at any time if so required in the interest of our Company or if required by the other parties, without reference to the Equity Shareholders, subject to compliance with applicable law.

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DECLARATION

No statement made in this Draft Letter of Offer contravenes any of the provisions of the Companies Act, 1956 and the rules made thereunder. All the legal requirements connected with the Issue as also the guidelines, instructions etc. issued by SEBI, Government and any other competent authority in this behalf, have been duly complied with. We further certify that all the statements in this Draft Letter of Offer are true and correct.

Signed by the Directors of our Company

Gautam Doshi

__________________________________________

Amit Khanna

__________________________________________

Sujal Shah

__________________________________________

Anil Sekhri

__________________________________________

Prasoon Joshi

__________________________________________

Anil Arjun Chief Executive Officer

__________________________________________

Ashish Agarwal Company Secretary & Manager

__________________________________________

Mohan Umrotkar Group Financial Controller

__________________________________________

Date: July 28, 2012 Place: Mumbai

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