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Shelf Disclosure Document Private and Confidential - For Private Circulat ion Only

Shelf Disclosure Document

Serial Number – [•] Addressed to – [•] Non-Transferable

DOCUMENT CONTAINING DISCLOSURES AS PER SCHEDULE I OF SEBI (ISSUE AND LISTING OF DEBT SECURITIES) REGULATIONS, 2008 AS AMENDED BY SEBI (ISSUE AND LISTING OF DEBT SECURITIES) (AMENDMENT) REGULATIONS, 2012 AND PURSUANT TO SECTION 42 OF THE COMPANIES ACT, 2013

Astra Microwave Products Limited ASTRA Towers, Survey No.12 (P), Kothaguda Post, Kondapur, Hitechcity, Hyderabad, Telangana- 500 084

Tel: +91 040 3061 8000/8001; Fax: +91 040 3061 8048 Email: [email protected] Website: www.astramwp.com Compliance officer: T. Anjaneyulu

Issue of 1,000 Rated Listed Secured Redeemable Non Cumulative Taxable Non-Convertible Debentures (“NCDs or Debentures”) of Face Value of ` 10,00,000 (Rupees Ten Lakhs) each, aggregating upto ` 1,00,00,00,000 (Rupees One Hundred Crores) on a Private Placement basis in multiple tranches to be issued in the financial year 2015-16.

The Issue is being made pursuant to the provisions of the Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008, as amended and the Companies Act, 2013, read with the Companies (Prospectus and Allotment of Securities) Rules, 2014, as amended.

RISK IN RELATION TO THE ISSUE There has been no formal market for the NCDs of the issuer. No assurance can be given regarding an active or sustained trading in the NCDs of the issuer or regarding the price at which the NCDs will trade after listing.

GENERAL RISK Prospective investors should consult their own legal, regulatory, tax, financial and/or accounting advisors about risks associated with an investment in such Debentures and the suitability of investing in such Debentures in light of their particular circumstances. Investment in these Debentures involve a degree of risk and investors should not invest any funds in this Issue unless they can afford to take the risk of losing their investment. Potential investors are advised to read this Offer Document carefully before taking an investment decision in this Issue. For taking an investment decision, investors must rely on their own examination of the Company and the Issue including the risks involved. The Debentures 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 document. This Offer Document has not been submitted, cleared or approved by SEBI.

ISSUER’S ABSOLUTE RESPONSIBILITY The Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Shelf Disclosure Document contains all information with regard to the Issuer and the Issue, which is material in the context of the Issue, that the information contained in this Shelf Disclosure Document 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 Shelf Disclosure Document as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.

CREDIT RATING CRISIL Limited has assigned its ‘CRISIL A+/Stable’ rating to NCDs of Astra Microwave Products Limited (AMPL). The rating is not a recommendation to buy, sell or hold securities and investors should take their own decision. The ratings may be subject to revision or withdrawal at any time by the assigned Credit Rating Agency on the basis of new information and each rating should be evaluated independently of any other rating. The ratings obtained are subject to revision at any point of time in the future.

LISTING The NCDs are proposed to be listed on the Bombay Stock Exchange Limited ("BSE" or the "Stock Exchange"). The BSE has given its 'in-principle' approval to list the NCDs by letter no. [•] dated [•].

MEMORANDUM OF PRIVATE PLACEMENT This Shelf Disclosure Document is neither a prospectus nor a statement in lieu of a prospectus. This is only an information brochure in the form of a single initial disclosure document, intended for private use and should not be construed to be a prospectus and /or an invitation to the public for subscription to the NCDs under any law for the time being in force. The Company however retains the right, at its sole and absolute discretion to change the “GENERAL TERMS AND CONDITIONS”

SHELF DISCLOSURE DOCUMENT

The Tranches of NCDs shall be issued on the terms and conditions set forth in this Shelf Disclosure Document, Addendum for Tranche 1 read together with the Debenture Trust Deed. The Company shall, by way of addendums to the Shelf Disclosure Document, provide details of material changes, if any, to the information provided in this Shelf Disclosure Document.

This Shelf Disclosure Document is dated October 27, 2015 and will be valid for a period of 180 days from the date of filing with the BSE.

Shelf Disclosure Document Private and Confidential - For Private Circulat ion Only


Arrangers Debenture Trustee Registrar and Transfer Agent

ICICI Securities Limited ICICI Centre, H. T. Parekh Marg, Churchgate, Mumbai 400 020

Tel: :+91-22-2288 2460 / 70 Fax: +91-22-2282 6580 Website: www.icicisecurities.com Email: [email protected]

IIFL Holdings Limited 10th Floor, IIFL Centre, Kamala City, Senapati Bapat Marg, Lower Parel (W) Mumbai 400 013

Tel: :+91-22-46464600 Fax: +91-22-24931073 Website: www.iiflcap.com Email: [email protected]

Axis Trustee Services Limited 2nd Floor, E wing, Bombay Dyeing Mills Compound, Pandurang Budhkar Marg, Worli Mumbai 400 025 Tel:+91-22- 2425 5218 Fax:+91- 22- 2425 4200 Website: www.axistrustee.com Email: [email protected]

Link Intime India Private Limited C-13, Pannalal Silk Mills Compound, L B S Marg, Bhandup (W), Mumbai – 400 078 Tel: +91 22 25963838 Fax: +91 22 25946979 /25946969 Website: www.linkintime.co.in Email : [email protected]

ISSUE PROGRAM Issue Opens on [•] 2015 Issue Closes on [•] 2015 The Company reserves the right to change the Issue time table including the Date of Allotment (as defined hereinafter) at its sole discretion, without giving any reasons or prior notice. The Issue will be open for subscription at the commencement of banking hours and close at the close of banking hours. . However, the Board/Committee of Directors (through its authorized signatories) reserves the right to close the issue on a later date. The Issue shall be subject to the terms and conditions of this Shelf Disclosure Document filed with the Stock Exchange and other documents in relation to the Issue.

Private and Confidential - For Private Circulation Only

3 Shelf Disclosure Document

DISCLAIMER

ISSUER’S DISCLAIMER This Shelf Disclosure Document is neither a prospectus nor a statement in lieu of a prospectus under the Companies Act, 2013. The Debentures issued pursuant to the Issue are proposed to be listed on BSE. Multiple copies hereof given to the same entity shall be deemed to be given to the same person and shall be treated as such. It does not constitute and shall not be deemed to constitute an offer or an invitation to subscribe to the Debentures to the public in general. Apart from this Shelf Disclosure Document, no offer document or prospectus has been prepared in connection with the offering of this issue or in relation to the company nor this Shelf Disclosure Document required to be registered under the applicable laws. Accordingly, this Shelf Disclosure Document has neither been delivered for registration nor it is intended to be registered. Neither this Shelf Disclosure Document nor any other information supplied in connection with the Debentures is intended to provide the basis of any credit or other evaluation and any recipient of this Shelf Disclosure Document should not consider such receipt, a recommendation to purchase any Debentures. Each Investor contemplating purchasing any Debentures should make its own independent investigation of the financial condition and affairs of the Issuer, and its own appraisal of the creditworthiness of the Issuer. Potential Investors should consult their own financial, legal, tax and other professional advisors as to the risks and investment considerations arising from an investment in the Debentures and should possess the appropriate resources to analyze such investment and the suitability of such investment to such Investor's particular circumstances. The Issuer confirms that, as of the date hereof, this Shelf Disclosure Document (including the documents incorporated by reference herein, if any) contains all information that is material in the context of the Issue and issue of the Debentures, is accurate in all material respects and does not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements herein, in the light of the circumstances under which they are made, and are not misleading. No person has been authorized to give any information or to make any representation not contained or incorporated by reference in this Shelf Disclosure Document or in any material made available by the Issuer to any potential Investor pursuant hereto and, if given or made, such information or representation must not be relied upon as having been authorized by the Issuer. This Shelf Disclosure Document and the contents hereof are restricted only for the intended recipient(s) who have been addressed directly and specifically through a communication by the Company and only such recipients are eligible to apply for the Debentures. All Investors are required to comply with the relevant regulations/guidelines applicable to them for investing in this Issue. The contents of this Shelf Disclosure Document are intended to be used only by those Investors to whom it is distributed. It is not intended for distribution to any other person and should not be reproduced by the recipient. No invitation is being made to any persons other than those to whom application forms along with this Shelf Disclosure Document being issued have been sent. Any application by a person to whom the Shelf Disclosure Document has not been sent by the Issuer shall be rejected without assigning any reason. The person who is in receipt of this Shelf Disclosure Document shall not reproduce or distribute in whole or part or make any announcement in public or to a third party regarding the contents without the consent of the Issuer. The Issuer does not undertake to update the Shelf Disclosure Document to reflect subsequent events after the date of the Shelf Disclosure Document and thus it should not be relied upon with respect to such subsequent events without first confirming its accuracy with the Issuer. Neither the delivery of this Shelf Disclosure Document nor any sale of Debentures made hereunder shall, under any circumstances, constitute a representation or create any implication that there has been no change in the affairs of the Issuer since the date hereof. Each person receiving this Shelf Disclosure Document acknowledges that such person has been afforded an opportunity to: a. request and to review and has received all additional information considered by an investor to be necessary;



b. verify the accuracy of or to supplement the information herein; and c. understand the nature of the NCD and the risks involved in investing in them including for any reason having to sell them or be made to redeem them before final redemption date No Prospective Investor has relied on any Intermediary, Arrangers or their Respective Agents or Advisors that may be associated with the issue in connection with its investigation of the accuracy of information or its investment decision This Shelf Disclosure Document does not constitute, nor may it be used for or in connection with, an offer or solicitation by anyone in any jurisdiction in which such offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. No action is being taken to permit an offering of the Debentures or the distribution of this Shelf Disclosure Document in any jurisdiction where such action is required. Persons into whose possession this Shelf Disclosure Document comes are required to inform themselves about and to observe any such restrictions. The Shelf Disclosure Document is made available to Investors in the Issue on the strict understanding that it is confidential.



DISCLAIMER OF THE SECURITIES AND EXCHANGE BOARD OF INDIA This Shelf Disclosure Document has not been filed with SEBI. The NCDs have not been recommended or approved by SEBI nor does SEBI guarantee the accuracy or adequacy of this document. It is to be distinctly understood that this document should not, in any way, be deemed or construed that the same has been cleared or vetted by SEBI. SEBI does not take any responsibility either for the financial soundness of Company or for the correctness of the statements made or opinions expressed in this document. The issue of NCDs being made on private placement basis, filing of this document is not required with SEBI, however SEBI reserves the right to take up at any point of time, with the Company, any irregularities or lapses in this document. DISCLAIMER OF THE STOCK EXCHANGE As required, a copy of this Shelf Disclosure Document has been submitted to the BSE Limited ("BSE") for hosting the same on its website. It is to be distinctly understood that such submission of the document with BSE or hosting the same on its website should not in any way be deemed or construed that the document has been cleared or approved by BSE; nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this document; nor does it warrant that this Issuer's securities will be listed or continue to be listed on BSE; nor does it take responsibility for the financial or other soundness of the Issuer, its promoters, its management or any scheme or project of the Company. Every person who desires to apply for or otherwise acquire any securities of this Issuer may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against BSE whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/ acquisition whether by reason of anything stated or omitted to be stated herein or any other reason whatsoever. Disclaimer of the Arrangers

It is advised that the Issuer has exercised self due diligence to ensure complete compliance of prescribed disclosure norms etc. in this Shelf Disclosure Document. The role of the Arrangers in the assignment is confined to marketing and placement of the Debentures on the basis of this Shelf Disclosure Document as prepared by the Issuer. The Arrangers has neither scrutinized/vetted nor have they done any due-diligence for verification of the contents of this Shelf Disclosure Document. Accordingly, no representation, warranty or undertaking (express or implied) is made and no responsibility is accepted by the Arrangers or any of their officers as to the adequacy, completeness or reasonableness of the information contained herein or of any further information, statement, notice, opinion, memorandum, expression or forecast made or supplied at any time in relation thereto.

The Arrangers shall use this Shelf Disclosure Document for the purpose of soliciting subscription from eligible investors for the Debentures to be issued by the Issuer on a private placement basis. It is to be distinctly understood that the aforesaid use of this Shelf Disclosure Document by the Arrangers should not in any way be deemed or construed that the Shelf Disclosure Document has been prepared, cleared, approved or vetted by the Arrangers; nor do they in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this Shelf Disclosure Document; nor do they take responsibility for the financial or other soundness of this Issuer, its promoters, its management or any scheme or project of the Bank. The Arrangers or any of their directors, employees, affiliates or representatives do not accept any responsibility and/or liability for any loss or damage arising of whatever nature and extent in connection with the use of any of the information contained in this Shelf Disclosure Document.

Please note that:

(A) The Arrangers and/or their Affiliates may, now and/or in the future, have other investment and commercial banking, trust and other relationships with the Issuer and with other persons ("Other Persons");

(B) As a result of those other relationships, the Arrangers and/or their Affiliates may get information about Other Persons, the Issuer and/or the Issue or that may be relevant to any of them. Despite this, the Arrangers and/or their Affiliates will not be required to disclose such information, or the fact that it is in possession of such information, to any recipient of this Shelf Disclosure Document;



(C) The Arrangers and/or their Affiliates may, now and in the future, have fiduciary or other relationships under which it, or they, may exercise voting power over securities of various persons. Those securities may, from time to time, include Debentures of the Issuer; and

(D) Each of the Arrangers and/or their Affiliates may exercise such voting powers, and otherwise perform its functions in connection with such fiduciary or other relationships, without regard to its relationship to the Issuer and/or the Debentures.

DISCLAIMER IN RESPECT OF JURISDICTION This Issue is made in India to investors as specified under clause “Who Can Apply” of this Shelf Disclosure Document, who shall be specifically approached by the Company. This Shelf Disclosure Document does not constitute an offer to sell or an invitation to subscribe to Debentures offered hereby to any person to whom it is not specifically addressed. Any disputes arising out of this Issue will be subject to the exclusive jurisdiction of the courts of Hyderabad. This offer of Debenture is made in India to persons resident in India. This Shelf Disclosure Document does not constitute an offer to sell or an invitation to subscribe to the Debentures herein, in any other jurisdiction to any person to whom it is unlawful to make an offer or invitation in such jurisdiction. Persons into whose possession this Shelf Disclosure Document comes are required to inform themselves about and to observe any such restrictions. Any person who has got access to the Shelf Disclosure Document unlawfully or accidentally should return it to the Company. This Shelf Disclosure Document is made available to potential investors in the Issue on the strict understanding that it is confidential and may not be transmitted to others, whether in electronic form or otherwise. CAUTIONARY NOTE This Shelf Disclosure Document is not intended to provide the sole basis of any credit decision or other evaluation and should not be considered as a recommendation that any recipients of this Shelf Disclosure Document should invest in the Debentures proposed to be issued by the Company. Each potential investor should make its own independent assessment of the investment merit of the Debentures and the Company. Potential investors should consult their own financial, legal, tax and other professional advisors as to the risks and investment considerations arising from an investment in the Debentures and should possess the appropriate resources to analyze such investment and the suitability of such investment to such investor’s particular

circumstance. This Shelf Disclosure Document is made available to potential investors on the strict understanding that it is confidential. Recipients shall not be entitled to use any of the information otherwise than for the purpose of deciding whether or not to invest in the Debentures. No person including any employee of the Company has been authorized to give any information or to make any representation not contained in this Shelf Disclosure Document. Any information or representation not contained herein must not be relied upon as having being authorized by or on behalf of the Company. Neither the delivery of this Shelf Disclosure Document at any time nor any statement made in connection with the offering of the Debentures shall under the circumstances imply that any information/representation contained herein is correct at any time subsequent to the date of this Shelf Disclosure Document. The distribution of this Shelf Disclosure Document or the Application Forms and the offer, sale, pledge or disposal of the Debentures may be restricted by law in certain jurisdictions. This Shelf Disclosure Document does not constitute an offer to sell or an invitation to subscribe to the Debentures in any jurisdiction to any person to whom it is unlawful to make such offer or invitation in such jurisdiction. Persons into whose possession this Shelf Disclosure Document comes are required by the Company to inform themselves about and observe any such restrictions. The sale or transfer of these Debentures outside India may require regulatory approvals in India, including without limitation, the approval of the RBI.



TABLE OF CONTENTS

DEFINITIONS AND ABBREVIATIONS .......................................................................................................... 8

SPECIAL CONSIDERATIONS AND RISK FACTORS ............................................................................... 12

TERMS OF OFFER ........................................................................................................................................... 40

DISCLOSURE REQUIREMENTS UNDER FORM PAS-4 PRESCRIBED UNDER THE COMPANIES ACT, 2013 ............................................................................................................................................................ 44

ANNEXURE 1 ANNEXURE 2 ANNEXURE 3 ANNEXURE 4 ANNEXURE 5 ANNEXURE 6 ANNEXURE 7 ANNEXURE 8 ANNEXURE 9 ANNEXURE 10



DEFINITIONS AND ABBREVIATIONS Unless the context otherwise indicates or requires, the following terms shall have the meanings given below in this Shelf Disclosure Document. General terms Term Description “AMPL” or “Astra Microwave” or the “Company” or the “Issuer” or “our Company”

a public limited company incorporated under the Companies Act, 1956 having its registered office at ASTRA Towers, Survey no.12 (P), Kothaguda Post, Kondapur, Hitechcity, Hyderabad- 500 084.

“we”, “us”, “our” Unless the context otherwise requires, the Company, and its Subsidiaries

Company related terms Term Description Articles of Association The Articles of Association of the Company Auditors Amar & Raju, Chartered Accountants, Hyderabad are

the statutory auditors of the Company. Board of Directors/Board The Board of Directors of the Company or a duly

constituted committee thereof.

Director(s) Director(s) on the Board, as appointed from time to time

Registered Office ASTRA Towers, Survey No.12 (P), Kothaguda Post, Kondapur, Hitechcity, Hyderabad- 500 084.

Subsidiaries Subsidiary of a company as defined under the Companies Act, 2013

Issue related terms Term Description Allot/Allotment/Allotted Unless the context otherwise requires or implies, the

allotment of the Debentures pursuant to the Issue. Application Form The form in which an investor can apply for

subscription to the Debentures Beneficial Owner(s) Holder(s) of the Debentures in dematerialized form as

defined under section 2 of the Depositories Act. Coupon Payment Date Date of payment of interest on the Debentures Credit Rating Agency CRISIL Limited Date of Allotment/ Deemed Date of Allotment Deemed date of allotment means in respect of the

Tranche 1 NCDs, the Tranche 1 Deemed Date of Allotment and in respect of the Tranche 2 NCDs, the Tranche 2 Deemed Date of Allotment, as the case may be

Debentures/NCDs Rated Listed Secured Redeemable Non-Cumulative Taxable Non-Convertible Debentures of the face value of ` 10,00,000 each aggregating to ` 100,00,00,000 to be issued by the Company on a private placement basis in multiple tranche (collectively Tranche 1 and Tranche 2)



Term DescriptionDebenture holder(s) The investors who are allotted Debentures Debenture Trustee Trustee for the Debenture holders, in this case being

Axis Trustee Services Limited

Debenture Trustee Regulations Securities and Exchange Board of India (Debenture Trustee) Regulations, 1993, as amended

Depository(ies) A depository registered with the SEBI under the Securities and Exchange Board of India (Depositories and Participant) Regulations, 1996, as amended from time to time, in this case being NSDL and CDSL.

Issue Issue by way of private placement of the Debentures in multiple tranches by the Issuer.

Maturity Date The date on which repayment of principal amount in respect of the Debentures shall be made.

Mutual Fund A mutual fund registered with SEBI under the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996.

NRI A person resident outside India, who is a citizen of India or a person of Indian origin and shall have the same meaning as ascribed to such term in the FEMA Regulations.

Pay-in Date The date on which the Debenture holders shall make payment for subscription to the Debentures

Record Date The date prior to the Maturity Date on which the determination of the persons entitled to receive interest in respect of the Debentures (i.e., persons whose names are registered in the Register of Debenture holders or NSDL/CDSL record) shall be made.

Registered Debenture holder The Debenture holder whose name appears in the Register of Debenture holders or in the beneficial ownership record furnished by NSDL/CDSL for this purpose.

Register of Debenture holders The register maintained by the Company/R&T containing the name of Debenture holders entitled to receive interest in respect of the Debentures on the Record Date, which shall be maintained at the Registered Office

Registrar/Registrar to the Issue Registrar to the Issue, in this case being Link Intime India Private Limited

Shelf Disclosure Document This document dated October 27, 2015 for Private Placement of Rated, Listed, Secured, Redeemable, Non-Cumulative, Taxable, Non-Convertible Debentures for cash at par aggregating to ` 100,00,00,000 to be issued by the Company in multiple tranches.

Stock Exchange BSE Tranche of NCDs Any of the Tranche 1 NCDs and the Tranche 2 NCDs. Tranche 1 Deemed Date of Allotment The date of deposit of the Tranche 1 Investment

Amount in the Escrow Account in accordance with the Debenture Trust Deed

Tranche 1 Investment Amount

The aggregate principal amount of the Tranche 1 NCDs subscribed to by the NCD Holders, up to a maximum of ` 500,000,000 (Rupees Fifty Crore only) or such other amount as may be mutually agreed between the Company and the NCD Holders (but not



Term Description exceeding the Investment Amount

Tranche 1 NCDs NCDs of a principal amount equal to the Tranche 1 Investment Amount, issued by the Company under the Debenture Trust Deed.

Tranche 2 Deemed Date of Allotment means the date of deposit of the Tranche 2 Investment Amount in the Escrow Account in accordance with the Debenture Trust Deed

Tranche 2 Investment Amount The aggregate principal amount of the Tranche 2 NCDs subscribed to by the NCD Holders, up to a maximum of ` 500,000,000 (Rupees Fifty Crore only) or such other amount as may be mutually agreed between the Company and the NCD Holders (but not exceeding the Investment Amount (after deducting the Tranche 1 Investment Amount)

Tranche 2 NCDs NCDs of a principal amount equal to the Tranche 2 Investment Amount, issued by the Company under the Debenture Trust Deed.

Working Days All days except Saturday, Sunday and any public holiday.

Conventional and General Terms, Abbreviations and References to Other Business Entities Term Description AY Assessment Year Buy-Back Regulations Securities and Exchange Board of India (Buy-back of

Securities) Regulations, 1998, as amended from time to time.

BSE BSE Limited. CDSL Central Depository Services (India) Limited. IPO Initial Public Offering. Companies Act The Companies Act, 2013 as amended from time to

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

time Depository Participant/DP A depository participant as defined under the

Depositories Act. DRDO Defence Research and Development Organisation Equity Shares Equity shares of the Company of face value of ` 2

each. FEMA Foreign Exchange Management Act, 1999. FEMA Regulations Rules and Regulations issued by the RBI under the

FEMA. Fiscal Period of twelve months ended March 31 of that

particular year, unless otherwise stated HNI High Net worth Individual. HUF Hindu Undivided Family. ISIN International Securities Identification Number. IT Act The Income Tax Act, 1961, as amended from time to

time. LOA Letter of Allotment NCR National Capital Region of Delhi. p.a. per annum. PAN Permanent Account Number PAC Persons Acting in Concert.



Term Description RBI The Reserve Bank of India. RoC The Registrar of Companies, Hyderabad National Capital Territory of Delhi and Haryana, located at New Delhi. ` Rupees SEBI The Securities and Exchange Board of India

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

1992, as amended from time to time. SEBI Regulations The Securities and Exchange Board of India (Issue

and Listing of Debt Securities) Regulations, 2008 issued by SEBI.

SEZ Special Economic Zone YTM Yield to Maturity



SPECIAL CONSIDERATIONS AND RISK FACTORS The Issuer believes that the following factors may affect its ability to fulfill its obligations under the Debentures issued under the Shelf Disclosure Document. All of these factors are contingencies which may or may not occur and the Issuer is not in a position to express a view on the likelihood of any such contingency occurring. In addition, certain factors which are material for the purpose of assessing the market risks associated with Debentures issued under the Shelf Disclosure Document are also described below. The Issuer believes that the factors described below represent the principal risks inherent in investing in Debentures issued under the Shelf Disclosure Document, but the inability of the Issuer, as the case may be, to pay coupon, principal or other amounts on or in connection with any Debentures may occur for other reasons and the Issuer does not represent that the statements below regarding the risks of holding any Debentures are exhaustive. Prospective Investors should also read the detailed information set out elsewhere in this Shelf Disclosure Document and all other information of the issuer available in the public domain and reach their own views prior to making any investment decision. Prior to making an investment decision, prospective Investors should carefully consider, along with the other matters set out in this Shelf Disclosure Document, the following investment considerations. Structured products such as the Debentures are sophisticated instruments, can involve a high degree of risk and are intended for sale only to those Investors capable of understanding the risks entailed in such instruments. If in doubt, potential Investors are strongly recommended to consult with their financial advisors before making any investment decision. The following discussion of a few risks associated to the Debentures, is subject to and pursuant to the terms of issuance of the Debentures as provided in this Shelf Disclosure Document, The initial subscriber by subscribing to, and any subsequent purchaser by purchasing the Debentures, shall be deemed to have agreed, and accordingly the Company shall be entitled to presume, that each of the initial subscriber, and any subsequent purchaser has reviewed, read and understood the terms and conditions contained in this Shelf Disclosure Document and found the same acceptable for investment. Risks in relation to our Business We have not entered into any long term contracts with our customers. Our company has not entered into any long term agreements with our customers. We may not be successful in winning significant business each year from our existing or future clients as the award of project is dependent on various factors. Furthermore, we do not have long term arrangements with our customers to purchase our products and services in the future, at the current prices or at all. There is no assurance that we will be able to maintain historic levels of business from the existing customers or to retain existing customers, or that we will be able to replace our customer base in a timely manner or at all, in the event our existing customers do not continue to purchase products manufactured by us at the same rate as in the past or at all. Such loss of customers or customer orders may have an adverse effect on our business, financial condition and results of operations. The loss, shutdown or slowdown of operations at any of our manufacturing facilities or underutilization of our manufacturing capacities may have a material adverse effect on our results of operations. We have four manufacturing facilities for manufacturing of our products. Our manufacturing facilities are subject to various operating risks, including the breakdown or failure of equipment, performance below expected levels of output or efficiency, facility obsolescence or disrepair, labour disputes, natural disasters and industrial accidents. Although, we take precautions to minimize the risk of any significant operational issues at our manufacturing facilities, the occurrence of any of these risks could adversely affect our operations by causing production at one or more of our facilities to cease or slow down. Utilization rates at our manufacturing facilities are subject to various factors including availability of raw materials, power, water, efficient working of machinery and equipment and optimal production planning and capacity utilization. An inability to utilize our manufacturing facilities to their full or optimal capacity or non-utilization of such capacities may adversely affect our business, results of operations and financial condition.



We have high working capital requirements and we may not be able to raise the required capital for future orders. As payments from customers are typically received several months after we commence work on particular projects, our business requires a large amount of working capital, used primarily to finance the purchase and processing of raw materials, and carrying inventory before they are sold and payments are received from customers. Our working capital requirements may increase if, under certain orders from our customers, payment terms do not include advance payments or such orders have payment schedules that shift payments toward the end of the order or otherwise increase our working capital requirements. In addition, our working capital requirements have increased in recent years because we have to maintain a stock of inventory of raw materials and products throughout the year. All of these factors may result, or have resulted, in increases in our working capital needs. Our ability to arrange working capital financing and the costs of such financing are dependent on numerous factors, including general economic and capital market conditions, credit availability from banks, investor confidence, the continued success of our current projects and laws that are conducive to our raising capital in this manner. Our attempts to complete future financings may not be successful or on favourable terms. In connection with projects that we implement, we may be required to provide bank guarantees or performance guarantees in favour of customers to secure obligations under contracts. If we are unable to provide sufficient collateral to secure the bank guarantees or performance guarantee, our ability to enter into new contracts could be limited. We may not be able to continue obtaining additional bank guarantees, and performance guarantee in sufficient quantities to match our business requirements. We maintain inventory of raw materials and components, work in progress and finished goods. Our level of inventory increases our risk of loss and storage costs as well as the working capital needed to operate our business. As our customers are not presently obliged to purchase our products or provide us with binding forecasts with respect to future production, there can be no assurance that our customers will require or purchase the goods we produce. Any of the foregoing, including if customer demand does not meet our production levels, could adversely affect our business, financial condition and results of operations. Defence offset policy is being replaced with made in India policy We were getting orders under Defence offset policy wherein foreign companies are supposed to manufacture or assemble equipment with parts or accessories or components manufactured in Indian Territory. The offset policy offered huge opportunity to our company. With the outset of new government, there are changes in government policies and the government has introduced made in India policy. Under such policy all equipment, parts, accessories, etc are to be manufactured only in India. Implementation of make in India policy could adversely affect our business, financial condition and results of operations. Any deficiency in the quality of our products may expose us to product liability claims. We are subject to laws and regulations relating to product liability arising from the manufacture and sale of our radio frequency and microwave based components and subsystems. If any of our products sold by us fails to comply with applicable quality standards, it may result in customer dissatisfaction, which may have an adverse effect on our business, sales and results of operations. From time to time, due to human or operational error, orders may not meet the specifications required by those customers and may therefore be rejected by customers. Any ongoing issues with products not meeting required specifications could reduce our revenue and impact negatively upon our reputation and financial performance. In addition, we may incur liability for defective products, product recalls, and delays in delivery or fulfilling contracts. Although we have not experienced any major product liability claims in the past, there can be no assurance that our customers or unrelated third parties will not make claims against us in the future that may result in adverse publicity. In case of any such product liability claims in the future, there can be no assurance that any product liability insurance we may obtain will be sufficient to indemnify us against such liabilities



Our success depends on our senior management and skilled manpower and an inability to attract and retain key personnel may have an adverse effect on our business prospects.

Our experienced senior management and executive directors have made significant contribution to the growth of our business, and our future success is dependent on the continued service of our senior management team. An inability to retain any senior management personnel may have an adverse effect on our operations. Our ability to successfully grow our radio frequency and microwave based components and subsystem business depends on our ability to attract, train, motivate and retain highly skilled professionals. We continue to face challenges in recruiting suitably skilled personnel, particularly as we continue to grow and diversify into new products. The loss of any of the members of our senior management team, our whole time directors or other key personnel or an inability to manage the attrition levels in different employee categories may materially and adversely impact our business, results of operations, financial condition and growth prospects.

Our results of operations could be adversely affected by strikes, work stoppages or increased wage demands by our employees.

While we have not experienced any significant employee related issues in the past, there can be no assurance that we will not in the future experience any strikes, work stoppages or other industrial actions or that these situations will not disrupt our business and operations. In the event that we are unable to manage any employee related issues or negotiate any settlement with our employees on acceptable terms, it could result in strikes, work stoppages or increased operating costs as a result of higher than anticipated wages or benefits. In addition, such industrial disruptions or work stoppages may result in production losses and delays in delivery of products, which may adversely affect our business prospects, reputation, and results of operations.

Our insurance coverage may not adequately protect us against certain operating hazards and this may have a material adverse effect on our business.

Our significant insurance policies consist of a comprehensive coverage for risks relating to our operations. While we believe that the amount of our insurance coverage is adequate based on management assessment, there can be no assurance that any claim under the insurance policies maintained by us will be honored fully, in part or on time. To the extent that we suffer loss or damage that is not covered by insurance or exceeds our insurance coverage, our results of operations and financial condition may be adversely affected.

We may be unable to obtain future financing to fund our operations, expected capital expenditure and working capital requirements on favourable terms, or at all.

Our business requires funding for capital expenditure and working capital requirements. The actual amount and timing of future capital expenditure may depend on several factors, among others, new opportunities, regulatory changes, economic conditions, technological changes and market developments in our industry. Our sources of additional funding, if required, to meet our capital expenditure may include the incurrence of debt or the issue of equity or debt securities or a combination of both. If we decide to raise additional funds through the incurrence of debt, our interest and debt repayment obligations will increase, and could have a significant effect on our profitability and cash flows and we may be subject to additional covenants, which could limit our ability to access cash flows from operations. In case there is insufficient cash flows to meet our working capital requirement or we are unable to arrange the same from other sources or there is delay in disbursement of arranged funds, or there is any increase in interest rate on our borrowings, it may adversely affect our operations and profitability. These factors may result in an increased amount of short-term borrowings. Continuous increase of our working capital requirements may have an adverse effect on our results of operations and financial condition.

Further our ability to arrange for additional funds on acceptable terms is subject to a variety of uncertainties, including future results of operations, financial condition and cash flows; economic, political conditions and market scenario for our products; costs of financing, liquidity and overall condition of financial and capital markets in India; issuance of necessary business/government licenses, approvals and other risks associated with our businesses; and limitations on our ability to raise capital in capital markets and conditions of the Indian and other capital markets in which we may seek to raise funds. Any such inability to raise sufficient funds could have a material adverse effect on our business and results of operations.



Increases in interest rates may materially impact our results of operations.

Interest rates for borrowings have been volatile in India in recent periods. Our operations are funded to a significant extent by debt and increases in interest expense may have an adverse effect on our results of operations and financial condition. Our current debt facilities carry interest at variable rates as well as fixed rates. Although we may engage in interest rate hedging transactions or exercise any right available to us under our financing arrangements to terminate the existing debt financing arrangement on the respective reset dates and enter into new financing arrangements, there can be no assurance that we will be able to do so on commercially reasonable terms, that our counterparties will perform their obligations, or that these agreements, if entered into, will protect us adequately against interest rate risks.

Any shortage or non-availability of electricity may adversely affect our manufacturing processes and consequently our business, results of operations and financial condition.

Our Company is engaged in the business of interalia manufacturing microwave based components and sub system requires substantial amounts of electricity. We depend on power supplied by the State electricity boards, as well as power generated through power generators. While we have not in the past been affected by any major power interruptions, such interruptions could occur in the future as a result of any natural calamity, technical fault or power shortages beyond our control. Further, there can be no assurance that electricity supplied by the State electricity boards, and from generators will be sufficient to meet our requirements or that we will be able to procure adequate and uninterrupted power supply in the future at a reasonable cost. Lack of sufficient electrical power or an increase in the cost of such power could adversely affect our business and results of operation.

We are subject to risks arising from foreign exchange rate fluctuations, which could adversely affect our results of operations.

Changes in currency exchange rates affect our results of operations. A portion of our expenses, including cost of any imported raw materials, products, freight costs, and other operating expenses in connection with our operations outside India, as well as certain of our capital expenditure on equipment imported, are denominated in currencies other than Indian Rupees. Depreciation of the Indian Rupee against the U.S. dollar and other foreign currencies may adversely affect our results of operations by increasing the cost of financing any debt denominated in foreign currency that we may enter into in the future or any proposed capital expenditure in foreign currencies. Furthermore, the financial reporting currency of our Company and the Indian subsidiaries is in Indian Rupees, while the financial reporting currency of our international operations is in other currencies. Our foreign currency exchange risks therefore arise from the mismatch between our financial reporting currencies, currency of a substantial majority of our revenue and the currency of a substantial portion of our expenses and our indebtedness, as well as timing differences between receipts and payments which could result in an increase of any such mismatch. Although we may selectively enter into hedging transactions to minimize our currency exchange risks, there can be no assurance that such measures will enable us to avoid the effect of any adverse fluctuations in the value of the Indian Rupee against the other relevant foreign currencies.

The Companies Act, 2013 has effected significant changes to the existing Indian company law framework, which may subject us to higher compliance requirements and increase our compliance costs. A majority of the provisions and rules under the Companies Act, 2013 have recently been notified and have come into effect from the date of their respective notification, resulting in the corresponding provisions of the Companies Act, 1956 ceasing to have effect. The Companies Act, 2013 has brought into effect significant changes to the Indian company law framework, such as in the provisions related to issue of capital (including provisions in relation to issue of securities on a private placement basis), disclosures in offer document, corporate governance norms, accounting policies and audit matters, related party transactions, introduction of a provision allowing the initiation of class action suits in India against companies by shareholders or depositors, a restriction on investment by an Indian company through more than two layers of subsidiary investment companies (subject to certain permitted exceptions), prohibitions on loans to directors and insider trading and restrictions on directors and key managerial personnel from engaging in forward dealing. We are also required to spend, in each financial year, at least 2.0% of our average net profits during three immediately preceding financial years towards corporate social responsibility activities. Further, the Companies



Act, 2013 imposes greater monetary and other liability on our Company, Directors and Key Managerial Personnel for any non-compliance. To ensure compliance with the requirements of the Companies Act, 2013, we may need to allocate additional resources, which may increase our regulatory compliance costs and divert management attention. The Companies Act, 2013 introduced certain additional requirements which do not have corresponding equivalents under the Companies Act, 1956. Accordingly, we may face challenges in interpreting and complying with such provisions due to limited jurisprudence on them. In the event, ur interpretation of such provisions of the Companies Act, 2013 differs from, or contradicts with, any judicial pronouncements or clarifications issued by the Government in the future, we may face regulatory actions or we may be required to undertake remedial steps. Additionally, some of the provisions of the Companies Act, 2013 overlap with other existing laws and regulations (such as the corporate governance norms and insider trading regulations issued by SEBI). Recently, SEBI issued revised corporate governance guidelines which are effective from October 1, 2014. Pursuant to the revised guidelines, we will be required to, amongst other things ensure that there is at least one woman director on our Board at all times, establish a vigilance mechanism for directors and employees and reconstitute certain committees in accordance with the revised guidelines. We may face difficulties in complying with any such overlapping requirements. Further, we cannot currently determine the impact of provisions of the Companies Act, 2013 and the revised SEBI corporate governance guidelines, which are yet to come in force. Any increase in our compliance requirements or in our compliance costs may have an adverse effect on our business and results of operations. A slowdown in economic growth in India could cause the Company's business to suffer The Company's performance and the quality and growth of its assets are necessarily dependent on the health of the overall Indian economy. A slowdown in the Indian economy could adversely affect its business, including its ability to grow its asset portfolio, the quality of its assets, and its ability to implement its strategy. India's economy could be adversely affected by a general rise in interest rates, or various other factors affecting the growth of industrial, manufacturing and services sector or general down trend in the economy Political instability or changes in the Government could delay further liberalization of the Indian economy and adversely affect economic conditions in India generally, which could impact the Company's financial results and prospects. Political instability could arise due to several reasons. Any political instability in the country could impact our business. The role of the Indian Central and State Governments in the Indian economy has remained significant over the years. There can be no assurance that these liberalization policies will continue in the future. The rate of economic liberalization could change, and specific laws and policies affecting financial services companies, foreign investment, currency exchange rates and other matters affecting investments in Indian companies could change as well. A significant change in India's economic liberalization and deregulation policies could disrupt business and economic conditions in India, thus affecting our business.

Terrorist attacks, civil unrest and other acts of violence or war involving India and other countries could adversely affect the financial markets and the Company's business Terrorist attacks and other acts of violence or war may negatively affect the Indian markets and may also adversely affect the worldwide financial markets. These acts may also result in a loss of business confidence. In addition, adverse social, economic and political events in India could have a negative impact on the Company. Such incidents could also create a greater perception that investment in Indian companies involves a higher degree of risk and could have an adverse impact on the Company's business. Risks in relation to the Debentures

The Debentures may be Illiquid



It is not possible to predict if and to what extent a secondary market may develop in the Debentures or at what price the Debentures will trade in the secondary market or whether such market will be liquid or illiquid. If the Debentures are listed or quoted or admitted to trading on BSE no assurance is given that any such listing or quotation or admission to trading will be maintained. The fact that the Debentures may be so listed or quoted or admitted to trading does not necessarily lead to greater liquidity than if they were not so listed or quoted or admitted to trading.

The Issuer may, but is not obliged to, at any time purchase the Debentures at any price in the open market or by tender or private agreement. Any Debentures so purchased may be resold or surrendered for cancellation. The more limited the secondary market is, the more difficult it may be for holders of the Debentures to realize value for the Debentures prior to redemption of the Debentures.

Downgrading in Credit Rating

CRISIL Limited has assigned its ‘CRISIL A+/Stable’ rating to NCDs of Astra Microwave Products Limited

(AMPL). The rating is not a recommendation to buy, sell or hold securities and investors should take their own decision. The ratings may be subject to revision or withdrawal at any time by the assigned Credit Rating Agency on the basis of new information and each rating should be evaluated independently of any other rating. The ratings obtained are subject to revision at any point of time in the future. Taxation

Potential purchasers and sellers of the Debentures should be aware that they may be required to pay stamp duties or other documentary charges/taxes in accordance with the laws and practices of India. Payment and/or delivery of any amount due in respect of the Debentures will be conditional upon the payment of all applicable taxes, duties and/or expenses.

Potential Investors who are in any doubt as to their tax position should consult their own independent tax advisers. In addition, potential Investors should be aware that tax regulations and their application by the relevant taxation authorities change from time to time. Accordingly, it is not possible to predict the precise tax treatment which will apply at any given time. With respect to the securities offered, the respective pledgers have made an application to the Income Tax Authorities under Section 281 of the Income Tax Act, 1961.There may be delay in receipt of such approval or the Authorities may not grant it approval / reject the application made by the pledging companies, which would impact the securities offered by the pledgers and the claim of the Authority may rank superior to that of the debenture holders.

Interest Rate Risk

All securities where a fixed rate of interest is offered are subject to price risk. The price of such securities will vary inversely with changes in prevailing interest rates, i.e. when interest rates rise, prices of fixed income securities fall and when interest rates drop, the prices increase. The extent of fluctuation in the prices is a function of the existing coupon/yield to maturity, days to maturity and the increase or decrease in the level of prevailing interest rates.

Delays in court proceedings in India

In the event any dispute arises between the Issuer and any other party, the Issuer or such other party may need to take recourse to judicial proceedings before courts in India. It is not unusual for court proceedings in India to continue for extended periods. Disposition of cases may be further subject to various delays including multiple levels of appellate adjudication.

The Debentures may not be a suitable investment for all investors.

Potential investors should ensure that they understand the nature of the Debentures and the extent of their exposure to risk, that they have sufficient knowledge, experience and access to professional advisers such as legal, tax, accounting and other advisers to make their own legal, tax, accounting and financial evaluation of the merits and risks of investment in the Debentures and that they consider the suitability of the Debentures as an investment in the light of their own circumstances and financial condition.



Future legal and regulatory obstructions

Future government policies and changes in laws and regulations in India and comments, statements or policy changes by any regulator, including but not limited to the SEBI or the RBI, may adversely affect the Debentures. The timing and content of any new law or regulation is not within the Issuer’s control and such

new law, regulation, comment, statement or policy change could have an adverse effect on market for and the price of the Debentures.

Further, the SEBI, the other relevant regulatory authorities may require clarifications on this Shelf Disclosure Document, which may cause a delay in the issuance of the Debentures or may result in the Debentures being materially affected or even rejected. Further, the exercise by the Debenture Trustee of the powers and remedies conferred on them respectively under the Debentures, and the other transaction documents, or otherwise vested in them by law, will be subject to general equitable principles regarding the enforcement of security, the general supervisory powers and discretion of the Indian courts in the context thereof and the obtaining of any necessary governmental or regulatory consents, approvals, authorisations or orders.

The Issuer has limited sources of funds to fulfill its obligations under the Debentures

If there is a shortfall in any amounts then due and payable pursuant to the terms of the Debentures, the Issuer may not have sufficient funds to make payments on the Debentures, and the Debenture Holders may incur a loss on the Debenture amount and redemption premium. The ability of the Issuer to meet its obligations to pay any amounts due to Debenture holders under the Debentures will ultimately be dependent upon funds being received from internal accruals and/or borrowings. The Issuer is therefore generally exposed to the credit risk of the relevant counterparties in respect of such payments.

DISCLAIMERS

This Shelf Disclosure Document in relation to the Debentures is made available by the Company to the applicant on the further strict understanding that

(i) the applicant is a “Person Resident in India” as defined under the Foreign Exchange Management Act,

1999,

(ii) in providing this Shelf Disclosure Document to the applicant, there will be no violation of rules, regulations and byelaws issued by any applicable authority including those issued by the Securities And Exchange Board of India;

(iii) the applicant has sufficient knowledge, experience, and professional advice to make his own evaluation of the merits and risks of a transaction of the type under this Shelf Disclosure Document; and

(iv) the applicant is not relying on the Issuer nor on any of the affiliates of the Company for information, advice or recommendations of any sort except for the accuracy of specific factual information about the possible terms of the transaction.

The Company is not acting as the advisor or agent of the applicant. This Shelf Disclosure Document does not purport to identify for the applicant, the risks (direct or indirect) or other material considerations, which may be associated with the applicant entering into the proposed transaction. Prior to entering into any proposed transaction, the applicant should independently determine, without reliance upon the Company or the affiliates of the Company, the economic risks and merits, as well as the legal, tax, and accounting characterizations and consequences of the transaction and including that the applicant is able to assume these risks. The Company, and/or the affiliates of the Company, may act as principal or agent in similar transactions and/or in transactions with respect to instruments underlying a proposed transaction. The Company, and/or the affiliates of the Company may, from time to time, have a long or short proprietary position/s and/or actively trade, by making markets to its clients, in financial products identical to or economically related to those financial products described in this Shelf Disclosure Document. The Company may also undertake hedging transactions related to the initiation or termination of a transaction, that may adversely affect the market price, rate, index or other market factors(s) underlying the financial product and consequently its value. The Company may have a commercial relationship with and access to information of reference securities, financial products, or other interests underlying a transaction.



This Shelf Disclosure Document and its contents are the Company’s property, and are to be considered proprietary information and may not be reproduced or otherwise disseminated in whole or in part without the Issuer’s written consent unless required to by judicial or administrative proceeding, and then with prior notice to

the Company. Applicants must understand that while the Debentures would be listed, in view of the nature and complexity of the Debentures, marketability may be impacted in a manner that cannot be determined. Past performance is not indicative of future performance. Investment in the Debentures may be subject to the risk of loss, meaning the Debenture holder may lose some or all of its investment especially where changes in the value of the transaction may be accentuated by leverage. Even where the Debentures are principal protected, there is a risk that any failure by a person including a counterparty to perform obligations when due may result in the loss of all or part of the investment. There is no assurance that past performances indicated in earlier product/scheme/instrument etc will be repeated. Applicants are not being offered any guaranteed or indicative returns through these Debentures No liability whatsoever is accepted for any loss arising (whether direct or consequential) from any use of the information contained in this Shelf Disclosure Document. The Company undertakes no obligation to effect any updates on information. Any opinions attributed to the Company, and/or the affiliates of the Company constitute the Company’s judgment as of the date of the material and are subject to change without notice. Provision of information may cease at any time without reason or notice being given. Commissions and other transaction costs may not have been taken into consideration. Any scenario analysis is provided for illustrative purposes only and does not represent actual termination or unwind prices, nor does it present all possible outcomes or describe all factors that may affect the value of your investment. NOTE: This Shelf Disclosure Document is not intended for distribution and it is meant solely for the consideration of the person to whom it is addressed and should not be reproduced by the recipient. The Debentures mentioned herein are being issued on a private placement basis and this offer does not constitute nor should it be considered a public offer/invitation. Nothing in this Shelf Disclosure Document shall constitute and/or deem to constitute an offer or an invitation to an offer to the Indian public or any section thereof to subscribe for or otherwise acquire the Debentures. This Shelf Disclosure Document and the contents hereof are restricted for only the intended recipient(s) who have been addressed directly through a communication by the Company and have been marked against the serial number provided herein and only such recipients are eligible to apply for the Debentures. All investors are required to comply with the relevant regulations/guidelines applicable to them for investing in this Issue. The Company or any other parties whose names appear herein, shall not be liable for any statements made herein or any event or circumstance arising therefrom. A copy of this Shelf Disclosure Document has not been filed or submitted to the SEBI for its review and/or approval. Potential investors are required to make their own independent evaluation and judgment before making the investment and are believed to be experienced in investing in debt markets and are able to bear the economic risk of investing in such instruments.



DISCLOSURES UNDER SCHEDULE I OF SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE AND LISTING OF DEBT SECURITIES) REGULATIONS, 2008, SEBI (ISSUE AND LISTING OF DEBT SECURITIES) (AMENDMENT) REGULATIONS 2012 AND PURSUANT TO SECTION 42 AND RULE 14(1) OF COMPANIES (PROSPECTUS AND ALLOTMENT OF SECURITIES) RULES, 2014.

NAME AND ADDRESS OF THE REGISTERED/ HEAD OFFICE OF THE ISSUER Name of the issuer Astra Microwave Products Limited Registered and Corporate Office ASTRA Towers, Survey No.12 (P), Kothaguda Post,

Kondapur, Hitechcity, Hyderabad, Telangana- 500 084

Compliance officer Mr. T Anjaneyulu@ CFO Mr. Gurunatha Reddy Sonnapureddy Tel: +91 040 3061 8000/8001 Fax: +91 040 3061 8048 Website: www.astramwp.com Address of the RoC Registrar of Companies

2nd Floor, Corporate Bhawan, GSI Post, Tattiannaram Nagole, Bandlaguda, Hyderabad – 500 068

@Investors can contact the compliance officer at the email id – [email protected] in case of any pre-issue or post-issue related problems such as non-receipt of letters of allotment, credit of debentures, interest on application money, etc. in the respective beneficiary account or refund orders, etc.

(i) Arrangers, if any, of the instrument:

Arrangers

ICICI Securities Limited ICICI Centre, H. T. Parekh Marg, Churchgate, Mumbai 400 020

Tel: :+91-22-2288 2460 / 70 Fax: +91-22-2282 6580 Website: www.icicisecurities.com Email: [email protected]

IIFL Holdings Limited 10th Floor, IIFL Centre, Kamala City, Senapati Bapat Marg, Lower Parel (W) Mumbai 400 013

Tel: :+91-22-46464600 Fax: +91-22-24931073 Website: www.iiflcap.com Email: [email protected]

(ii) Trustee of the issue: Axis Trustee Services Limited (iii) Registrar of the issue:

Registrar and Transfer Agent

Link Intime India Pvt. Ltd C-13, Pannalal Silk Mills Compound, L B S Marg, Bhandup (W), Mumbai – 400 078 Tel: +91 22 25963838 Fax: +91 22 25946979 / 25946969 Website: www.linkintime.co.in Email:[email protected]

(iv) Credit Rating Agency (-ies) of the issue: CRISIL Limited



(v) Compliance Officer Name : Mr. T Anjaneyulu Address : ASTRA Towers, Survey No.12 (P), Kothaguda Post, Kondapur, Hitechcity,

Hyderabad, Telangana- 500 084 Tel : 040 3061 8000 Fax : 040 3061 8048 Email : [email protected]

(vi) Auditors of the issuer Name : M/s Amar & Raju Address : Flat No: 201, KOR Residency,

H.No:8-3-966/16, Road No:3, Nagarjuna Nagar, Srinagar Colony, Hyderabad – 500 073.

Tel : +91 040 23748129 Email : [email protected]



A. Brief Summary of the business activities of the issuer and its line of business

i. Overview

Our Company is in the business of designing, developing and manufacturing a wide array of radio frequency systems, microwave chips, microwave based components, subsystems and systems and associated digital electronics for original equipment manufacturers (“OEMs”) of radars, telemetry equipment’s, ground based surveillance, satellite communications, equipment’s used in defence sector

like missiles, light combat aircrafts and equipment’s used for meteorology etc. Our Company also

provides services of installation, maintenance and repairs of the components, subsystems and systems manufactured by us. Some of our major clients include large public sector enterprises including navratna public sector enterprises and large multinational defence electronics companies. A significant part of our products, catering to the defence industry, are also exported. Our focus areas for designing, developing and manufacturing radio frequency systems, microwave chips, microwave based components, subsystems and systems under each segment are as follows:

Products catering to the defence sector Designing, developing and manufacturing of components, subsystems and systems used in manufacturing of

Radars Missiles Electronic warfare Telemetry Avionics Ground based surveillance

Products catering to the space sector Designing, developing and manufacturing of components, subsystems and systems used in manufacturing of

Ground based modules S-level (on- board) modules

Products catering to the metrological and telecom sector

Designing, developing and manufacturing of components, subsystems and systems

Metrological products mainly comprising of automatic weather stations and met towers

Telecom and satcom products mainly comprising of MSS terminals for disasters communication.

Products that are exported Designing, developing and manufacturing of components, and subsystems used in manufacturing of radar and telecom applications

Base station filters Transmit / Receive modules for radar

application IC Components

Our Company was promoted inter alia by our Managing Director, Mr. Bhummireddy Malla Reddy, who has over three decades of experience in the field of designing, developing and manufacturing of radio frequency systems, microwave chips, microwave based components, subsystems and systems and associated digital electronics. Prior to incorporating our Company, on September 13, 1991, he had worked as a scientist with Defence Research and Development Laboratory and other private sector companies. Our Company started by making radio transistors, receivers and cell jammers and over a period of nearly two and a half decades, our Company aided with a professional work environment, strong technical skills, large workforce, strong research



and development expertise and a competent management, developed the ability to design, develop and manufacture complex radio frequency systems, microwave chips, microwave based components and associated digital electronics, catering to the needs of both domestic and international customers.

Our Company has four operational manufacturing facilities, all of which are located in Telangana. Unit I and Unit II are located at Medak district in Telangana and Unit III and Unit IV are located at Ranga Reddy district in Telangana. Manufacturing operations were commenced at Unit I in Medak district in FY 1993-94, at Unit II in Medak district in FY 1997-98, at Unit III in Ranga Reddy district in FY 2003-04 and at Unit IV in in Ranga Reddy district in FY 2008-09. All the four units of our Company design, develop and manufacture inter alia radio frequency systems, microwave chips, microwave based components, subsystems and systems and associated digital electronics. The Units follow two types of processes namely Build To Specs (“BTS”) and Built To Print (“BTP”) for designing, developing and manufacturing products, to meet the requirements of our customers. The BTS process is used when our Company is required to manufacture a finished product after designing, developing and testing the product, from scratch. The BTP model is used when the customer provides the complete manufacturing details of their requirements, and our Company is required to manufacture and deliver the product as per the requirements provided by the customer. The designing and developing of our products is carried out by our in-house R&D unit, which is recognized by the Ministry of Science and Technology, Department of Scientific and Industrial Research. Our subsidiary, Bhavyabhanu Electronics Private Limited, is into manufacturing, producing and processing of automatic assembly services and otherwise to deal in all kinds of electronic machinery, spares and other types of consultancy services in the field of electronic machinery and equipment. Our another subsidiary, Aelius Semiconductors Pte. Limited, is in the business of manufacture of semiconductor devices and printed circuit board with electronic parts.

We have recently set up R&D center in Bangalore for Defence, security and civilian applications, which will enable our Company to cater to a new market segment of customers. This R&D center in Bangalore is working on development of seekers, advance radar warning systems and wind profile radars which has potential to deliver high business volume down the line. We believe our R&D center will further strengthen our capabilities of providing complete end to end solutions, i.e building from concept to ultimate product development, in a very cost effective and time effective manner. Riding on the technical excellence of our R&D center our Company successfully produced space-borne hardware, successfully designed and developed the command guidance unit for Akash, the battle field surveillance radar for DRDO Labs and the electronics for Active Array Antenna Unit.. The DRDO, Ministry of Defence awarded the Defence Technolgy Absorption Award 2001, to our Company for, developing and producing microwave components and systems, meeting the stringent quality requirements of various critical sub-systems and assemblies (such as Command and Guidance Unit Mark-II for Akash Missile System), required by Defence Research & Development Laboratory. The miniaturized versions of various critical sub-systems and assemblies produced by our Company are about 50% in weight and size and are being used by other missile systems also.

Our Company has received various industry and client specific accreditations and certifications which allow us to deliver and supply quality products to our customers. Intertek Certification Limited has certified our quality management system, for our units, to be confirming to the requirement of ISO 9001:2008 certificates (in relation to the supply of microwave components, equipment, antennas and MMIC for defence, space and telecommunication applications). Further National Quality Assurance, USA has granted a certificate of registration against the provisions of ANSI/ESD S20.20-2007 to the electrostatic discharge control program, of Unit IV of our Company, in relation to defence radar products. The National Quality Assurance, USA has also granted a certificate of registration that the quality management system, of Unit IV of our Company, applicable to the production and supply of transmit/receive modules for RF systems, to be assessed and approved against the provisions of ISO 9001:2008 and AS9100C and in accordance with the requirements of AS9104/1:2012. We believe that these accreditations and certifications help us in maintaining long term relationships with our customers.



For the FY 2014-15 and FY 2013-14, our total income, was ` 6,398.17 million and ` 5,389.73 million respectively and our profit after tax, as restated, was ` 627.58 million and ` 508.36 million respectively, based on restated audited consolidated financial statements.

Corporate Structure:

Set forth is a simplified organizational structure chart of our Company and its subsidiaries as of September 30, 2015:

(i) Key Operational and Financial Parameters for the last 3 Audited years: On a Consolidated basis (The key operational and financial parameters have been provided for a period of two years, since there was no subsidiary of the company for the financial year 2013 and hence accordingly no consolidated statements were prepared for financial year 2013) (` million)

Parameters FY-2015 FY-2014 For Non-Financial Entities Net Worth@ 2918.2 2411.9 Total Debt 923.1 608.0 of which – - Non Current Maturities of Long Term Borrowing 326.3 261.5 - Short Term Borrowings 488.9 256.7

- Current Maturities of long Term Borrowings

107.9 89.8

Net Fixed Assets 1416.0 1260.5 Non Current Assets 1439.1 1350.0 Cash and Cash Equivalents(a) 290.5 636.7 Current Investments 0 20.0 Current Assets 3502.4 4296.3 Current Liabilities 1553.5 2865.5 Net Sales 6335.6 5311.6 EBITDA 1128.0 849.1 EBIT 907.5 701.0 Interest 99.7 67.3 Profit after tax (PAT) 627.6 508.4 Dividend Declared 98.19 90.01

Current Ratio 2.25 1.50 Interest Coverage Ratio 9.77 11.16 Gross debt/equity ratio 0.32 0.25

Astra Microwave Products Limited

Bhavyabhanu Electronics Private Limited (99.998%)

Aelius Semiconductors Pte.

Limited (100%)



Debt Service Coverage Ratio 8.67 11.01 @ Net Worth = Share capital + All Reserves

Gross Debt: Equity Ratio -Consolidated Basis:- Before the issue of debt securities(b) 0.32 After the issue of debt securities(b) 0.66

Note:

a) Cash &Cash equivalents amount includes Margin Deposits provided as security for Bank Guarantees and Dividend Warrant Bank (current ) accounts balances.

b) Gross Debt Equity Ratio after the issue of Debt securities aggregating to ` 1,000 million is calculated using the base as financial year ending March 31, 2015.

(ii) Key Operational and Financial Parameters for the last 3 Audited years: On a standalone basis (` million) For Non-Financial Entities FY-2015 FY-2014 FY-2013 Net Worth@ 2900.2 2412.8 2008.8 Total Debt 892.0 608.0 463.2 of which – - Non Current Maturities of Long Term Borrowing

315.2 261.5 135.2

- Short Term Borrowings 475.6 256.7 282.0 - Current Maturities of long Term Borrowings 101.2 89.8 46.0 Net Fixed Assets 1392.1 1256.5 1079.2 Non Current Assets 1417.4 1330.5 1111.8 Cash and Cash Equivalents(a) 277.2 610.0 1132.7 Current Investments 0 20.0 233.0 Current Assets 3378.8 4281.2 3876.1 Current Liabilities 1439.8 2829.6 2765.8 Net Sales / Total Income 6343.4 5311.6 2274.7 EBITDA 1086.4 850.3 615.4 EBIT 871.0 702.4 481.9 Interest 94.8 67.3 41.3 Profit after tax (PAT) 607.3 509.3 371.9 Dividend Declared 98.19 90.01 65.46 Current Ratio 2.35 1.51 1.40 Interest Coverage Ratio 9.93 11.18 13.44 Gross debt/equity ratio 0.31 0.25 0.23 Debt Service Coverage Ratio 8.65 11.03 5.03 @ Net Worth = Share capital + All Reserves Gross Debt: Equity Ratio -Standalone Basis:- Before the issue of debt securities(b) 0.31 After the issue of debt securities(b) 0.65

Note:



a) Cash &Cash equivalents amount includes Margin Deposits provided as security for Bank Guarantees and Dividend Warrant Bank (current ) accounts balances.

b) Gross Debt Equity Ratio after the issue of Debt securities aggregating to ` 1,000 million is calculated using the base as financial year ending March 31, 2015.

Brief history of the Company Our Company was incorporated on September 13, 1991 under the name of Astra Microwave Products Private Limited as a private limited company. Pursuant to a fresh certificate of incorporation dated April 6, 1993, consequent to change of name, our Company’s name was changed to Astra Microwave Products Limited. The CIN of our Company is L29309TG1991PLC013203. Our Registered Office is situated at ASTRA Towers, Survey No.12 (P), Kothaguda Post, Kondapur, Hitechcity, Hyderabad, Telangana- 500 084

Subsidiaries The Company has 2 subsidiaries 1. M/s Bhavyabhanu Electronics Private Limited 2. Aelius Semiconductors Pte. Limited

Details of Share Capital as on last quarter ended September 30, 2015 :

Share Capital Details Amount (` million) Authorized Share Capital 150,000,000 equity shares of ` 2 each 300

Issued Share Capital 81,825,225 equity shares of ` 2 each 163.65 Subscribed & fully paid up 81,825,225 equity shares of ` 2 each 163.65 Size of the Present Offer No Equity shares are being offered in the present

offer Nil

Subscribed & fully paid up Paid up capital

(a) After the offer 81,825,225 equity shares of ` 2 each 163.65 (b) After conversion of

convertible instrument (if applicable)

Not Applicable Not Applicable

Share Premium Account before the issue as on 31st March 2015

-- 50.45

Share Premium Account after the issue

-- 50.45

Changes in its capital structure as on last quarter end, for the last five years:

Date of Change (AGM/EGM) ` Particulars

December 31, 2010(EGM) 54,550,150 Allotment of bonus share July 31, 2014(AGM) 300,000,000 Increase in authorised share capital

from ` 200,000,000 to ` 300,000,000

Equity Share Capital History of the Company as on last quarter end, for the last five years:

Date of No of Face Issue Nature of Nature of Cumulative Remarks



Allotment Equity Shares

Value (`)

Price (`)

consideration

allotment No of equity shares

Equity Share

Capital (`)

Equity Share

Premium (`)

December 31, 2010

27,275,075 2 2 Other than Cash

Bonus Issue 81,825,225 163,650,450

177,550,442

-

The history of the equity share capital of our Company since inception is as follows:

Date of Issue/ Allotment

Number of Equity Shares

Face Value (`)

Issue Price (`)

Cumulative Number of

Equity Shares

Cumulative paid-up capital

(`)

Nature of Consideration

Mode of Allotment

September 13,1991

200 10 10 200 2,000 Cash Subscribers to Memorandum

September 23, 1991

4,100 10 10 4300 43,000 Cash Preferential Allotment

March 31, 1993

610,350 10 10 614,650 6,146,500 Cash Preferential Allotment

May 28, 1993 307,325 10 10 921,975 9,219,750 Other than Cash

Bonus issue

May 28, 1993 200,000 10 10 1,121,975 11,219,750 Cash Issue of shares on account of conversion of secured loan (income loan from Canbank Venture Financial Services)

July 17, 1993 30,500 10 10 1,152,475 11,524,750 Cash Conversion of secured loan taken from Canbank Venture Financial Services

August 10, 1994

47,375 10 10 1,199,850 11,998,500 Cash Preferential Allotment

January 11, 1995

458,300 10 60 1,658,150 16,581,500 Cash Initial Public Offering

March 30, 1995

150 10 10 1,658,300 16,583,000 Other than Cash

Scheme of amalgamation

July 31, 2000 141,700 10 10 1,800,000 18,000,000 Cash Equity share allotted pursuant to ESOP

September 1, 2000

1,800,000 10 10 3,600,000 36,000,000 Other than Cash

Bonus Issue

January 7, 2002

729,168 10 46.85 4,329,168 43,291,680 Cash Preferential Allotment

January 31, 2002

729,167 10 46.85 5,058,335 50,583,350 Cash Preferential Allotment.

April 25, 2003 252,910 10 16.70 5,311,245 53,112,450 Cash Preferential Allotment August 31, 2005

26,556,225 2 2 26,556,225

53,112,450 - Split of equity shares

October 15, 2005

26,556,225 2 2 53,112,450 106,224,900 Other than Cash

Bonus Shares

April 5, 2006 167,150 2 72.20 53,279,600 106,559,200 Cash Equity share allotted pursuant to ESOP

April 5, 2006 167,150 2 - 53,446,750 106,893,500 Other than Cash

Bonus issue

April 5,2007 154,550 2 72.20 53,601,300 107,202,600 Cash ESOP April 5,2007 154,550 2 - 53,755,850 107,511,700 Other than Bonus Issue



Cash April 2, 2008 145,050 2 72.20 53,900,900 107,801,800 Cash ESOP April 2, 2008 145,050 2 - 5,40,45,950 108,091,900 Other than

Cash Bonus Issue

April 3, 2009 48,700 2 72.20 54,094,650 108,189,300 Cash ESOP April 3, 2009 48,700 2 - 54,143,350 108,286,700 Other than

Cash Bonus Issue

April 5, 2010 203,400 2 72.20 54,346,750 108,693,500 Cash ESOP April 5, 2010 203,400 2 - 54,550,150 109,100,300 Other than

Cash Bonus Issue

December 31, 2010

27,275,075 2 2 81,825,225 163,650,450 Other than Cash

Bonus Issue

Details of number and price at which each of the allotments were made in the last one year preceding the date of the Shelf Disclosure Document separately indicating the allotments made for considerations other than cash and the details of the consideration in each case- Not applicable

Details of any Acquisition or Amalgamation in the last 1 year- Not applicable

Details of any Reorganization or Reconstruction in the last 1 year: - Not applicable

Details of the shareholding of the Company as on the latest quarter end:-

i. Shareholding pattern of the Company as on last quarter end i.e as on September 30, 2015:- Please refer Annexure 8.

ii. List of top 10 holders of equity shares of the Company as on the latest quarter end i.e as on

September 30, 2015:-

Sr No Name of the shareholders

Total No of Equity Shares

No of shares in demat form

Total Shareholding as %

of total no of equity shares

1. LARSEN AND TURBO LIMITED

7,950,045 7,950,045 9.71

2. HDFC TRUSTEE COMPANY LIMITED- HDFC

73,62,613 73,62,613 8.99

3. AXIS MUTUAL FUND TRUSTEE LIMITED

48,63,146 48,63,146 5.94

4. ATIM KABRA 33,66,211 33,66,211 4.11 5. HASHAM

INVESTMENT AND TRADING COMPANY

3,182,709 3,182,709 3.88

6. RELIANCE CAPITAL TRUSTEE CO LTD

2,932,869 2,932,869 3.58

7. TATA BALANCED FUND

24,85,000 24,85,000 3.03

8. BHUMI REDDY MALLA REDDY

24,25,882 24,25,882 2.96

9. STRATEGIC VENTURES FUND

1,789,597 1,789,597 2.18






Total Shareholding as %

of total no of equity shares

(MAURITIUS) 10. RAMYA

CHITRAKAR 17,79,997 17,79,997 2.17

Profits of the company, before and after making provision for tax, for the three financial years

immediately preceding the date of circulation of Shelf Disclosure Document: (` in million)

Financial Year 2015 (Consolidated)

2014 (Consolidated)

2015 (Standalone)

2014 (Standalone)

2013 (Standalone)

Profit Before Tax 847.09 696.20 814.38 697.51 504.38

Less: Provision for Tax 219.51 187.83 207.13

188.24

132.52

Profit After Tax 627.58 508.37 607.25 509.27 371.86

Dividends declared by the company in respect of the said three financial years; interest coverage ratio for last three years

Financial Year 2015

(Consolidated) 2014

(Consolidated) 2015

(Standalone) 2014

(Standalone) 2013

(Standalone) Dividend Declared (` in million)

98.19 90.01 98.19 90.01 65.46

Interest Coverage Ratio 9.77 11.16 9.93 11.18 13.44

Brief Particulars of management Mr. Bhumireddy Malla Reddy

Mr. Bhumireddy Malla Reddy, aged 68 years, is the Managing Director of our Company.

Mr. Prakash Anand Chitrakar

Mr. Prakash Anand Chitrakar, aged 64 years, is the Whole Time Director designated as Chief Operating Officer of our Company.

Mrs. Prameelamma Chennareddy

Mrs. Prameelamma Chennareddy, aged 66 years, is the Whole Time Director designated as Director (Technical) of our Company.

Mr. Shiban Kishen Koul

Mr. Shiban Kishen Koul, aged 61 years, is the Independent Director & Chairman of our Company.

Mr. Gurunatha Reddy Sonnapureddy

Mr. Gurunatha Reddy Sonnapureddy, aged 56 years, is the Whole Time Director & Chief Financial Officer of our Company.

Mr. Maram Venkateshwar Reddy



Mr. Maram Venkateshwar Reddy, aged 48 years, is the Whole Time Director of our Company.

Mr. Ramachandru Tejavath

Mr. Ramachandru Tejavath, aged 62 years, is the Independent Director of our Company.

Mr. Umayi Kuppusamy Kalyanaramudu

Mr. Umayi Kuppusamy Kalyanaramudu, aged 61 years, is the Non-Executive Director of our Company.

Mr. Ganapathi Subramani Sabarinathan

Mr.Ganapathi Subramani Sabarinathan, aged 55 years, is the Independent Director of our Company.

NAMES AND ADDRESSES OF THE DIRECTORS OF THE ISSUER

Name, Occupation, Term and Nationality

Age Designati

on

Director Identification

Number Address Director Since

Details of other directorships

Mr. Bhumireddy Malla Reddy Occupation: Business Term: Liable to retire by rotation Nationality: Indian

68

Managing Director

00003154 Plot no. 514, road no. 29, Jubilee Hills, Hyderabad, 500034, Andhra Pradesh, India

September 13, 1991

NIL

Mr. Prakash Anand Chitrakar Occupation: Business Term: Liable to retire by rotation Nationality: Indian

64 Chief Operating Officer

00003213 Plot no.8/A, Vinay Nagar Colony, Saidabad, Hyderabad, 500059, Andhra Pradesh, India

March 01, 1993

NIL

Mrs. Prameelamma Chennareddy Occupation: Business Term: Liable to retire by rotation Nationality: Indian

66 Director 00003243 Flat No:G-106, Girisikara Enclave, Hilltop Colony, Erramanzil, Hyderabad-500082, Andhra Pradesh, India

September 13, 1991

NIL

Dr. Shiban Kishen Koul Occupation: Professional Term: Till March 31, 2019

61

Independent Director and Chairman

00003360 1, West Avenue, opposite Kailash Girls Hostel, IIT Campus, Hauz Khas, New Delhi-110016, Delhi, India

April 25, 2005

Electronics Sector Skills Council of India



Name, Occupation, Term and Nationality Age

Designation

Director Identification

Number Address Director Since

Details of other directorships

Nationality: Indian Mr. Gurunatha Reddy Sonnapureddy Occupation: Professional Term: Liable to retire by rotation Nationality: Indian

56

Whole Time Director & Chief Financial Officer

00003828 Flat No:301, Urjitha Apartments, West Anand Bagh, Safilguda, Hyderabad 500047, Andhra Pradesh, India

April 29, 2013

NIL

Mr. Maram Venkateshwar Reddy Occupation: Professional Term: Liable to retire by rotation Nationality: Indian

48

Whole Time Director

00421401 6-3-597/5/9, Red Fort Constructions, Anand Nagar, Hyderabad, 500004, Andhra Pradesh, India

April 29, 2013

NIL

Mr. Ramachandru Tejavath

Occupation: Retired IAS, Professional Term: Till March 31, 2019 Nationality: Indian

62 Independent Director

02000451 N-33, Nivedita Kunj, Sector-10, R.K.Puram, New Delhi, 110022, Delhi, India

October 30, 2013

NIL

Mr. Umayi Kuppusamy Kalyanaramudu Occupation: Professional Term: Till March 31, 2019 Nationality: Indian

61 Non – Executive Director

05227194 1486, 5th Main E Block, 2nd Stage, Rajaji Nagar, Bangalore-560010, Karnataka, India

April 28, 2014

NIL

Mr.Ganapathi Subramani Sabarinathan Occupation: Professional Term: Till January 30, 2020 Nationality: Indian

55 Independent Director

05219684 No. 307, Faculty Quarters, Indian Institute of Management Bangalore, Bangalore-560076, Karnataka, India

January 31, 2015

IIMB Innovations



None of the current directors of the Company are appearing in the RBI defaulter list and/or ECGC default list. Following details of the directors of the Company:- Details of change in directors since last three years:-

Name, Designation and

DIN Date of Appointment/

Resignation Director of the

Company since ( in case of resignation)

Remarks

Mr. Gurunatha Reddy Sonnapureddy Designation- Whole-Time Director & CFO DIN: 00003828

April 29, 2013 - Appointment

Mr. Maram Venkateshwar Reddy Designation:Director DIN: 00421401


Mr. Ramachandru Tejavath Designation- Independent Director DIN: 02000451

October 30, 2013 - Appointment

Mr. Umayi Kuppusamy Kalyanaramudu Designation- Non- Executive Director DIN: 05227194


Mr.Ganapathi Subramani Sabarinathan Designation- Independent Director DIN: 05219684

January 31, 2015 - Appointment

Mr. Janardana Rao Venkatdas Designation- Independent Director DIN: 00003227

August 1, 2015 May 24, 2000 Resignation



Name, Designation and DIN

Date of Appointment/ Resignation

Director of the Company since ( in case

of resignation)

Remarks

Mr. Atim Kabra Designation-Non Executive Director DIN: 00003366

August 1, 2015 December 24, 2001 Resignation

Following details regarding the auditors of the Company:-

Details of the auditor of the Company:-

Name Address Auditor since M/s Amar& Raju Flat No. 201, KOR Residency, H.

No. 8-3-966/16, Road no. 3, Nagarjuna Nagar, Srinagar Colony, Hyderabad- 500 073

Since incorporation

Details of change in auditor since last three years:-

There has been no change in auditors of our Company since the last three years.

Details of Borrowings (i) Details of borrowings of the Company, on standalone basis, as on June 30, 2015:-

Details of Secured Loan Facilities :-

Lender’s Name

Type of Facility

Amount Sanctioned(`

millions)

Principal Amount outstanding/Amount

outstanding (` million)

Repayment Date /

Schedule / Tenure of

facility

Security

Canara Bank Working Capital(Fund based and Non fund based)

1,100 No outstanding amount

December 12, 2015

Hypothecation of entire stock and other chargeable current asset of the company and other collateral security

State Bank of India

Working Capital(Fund based and Non fund based)

2,800 No outstanding amount

November 11, 2015

Hypothecation of entire stock and other chargeable current asset of the company and other



Lender’s Name

Type of Facility

Amount Sanctioned(`

millions)



Repayment Date /


facility

Security

collateral security

HDFC Bank Limited


700 367.17 Renewal on yearly basis


Term Loan 200 81.49 Repayable quarterly upto October 20, 2016

First charge on unencumbered fixed assets funded by HDFC bank and other collateral security

Term Loan 187.5 143.37 Repayable quarterly upto August 21, 2018

First charge on unencumbered fixed assets funded by HDFC bank and other collateral security

Term Loan 120 108.65 Repayable quarterly upto December 11, 2020

First charge on fixed assets funded by HDFC bank, charge on company’s

entire current asset and other collateral security

ICICI Bank Limited


500 No outstanding amount

November 27, 2015


Axis Bank Working Capital(Fund

500 No outstanding amount

May 7, 2016 Hypothecation of entire stock



Lender’s Name

Type of Facility

Amount Sanctioned(`

millions)



Repayment Date /


facility

Security

based and Non fund based)

and other chargeable current asset of the company and other collateral security

Term Loan 81 47.51 Repayable quarterly upto April 30, 2019

First exclusive charge on the fixed assets funded by term loan sanctioned by Axis Bank and other collateral security

(ii) Details of Unsecured Loan Facilities:- Not Applicable

(iii) Details of NCDs:- Nil (iv) List of Top 10 Debenture Holders (as on 31.08.2015) :Not Applicable (v) The amount of corporate guarantee issued by the Issuer along with name of the counterparty (like name

of the subsidiary, group company, etc) on behalf of whom it has been issued. Rs. 200 million

(vi) Details of Commercial Paper:- The total Face Value of Commercial Papers Outstanding as on the latest quarter end:-. Nil

(vii) Details of Rest of the borrowing ( if any including hybrid debt like FCCB, Optionally Convertible Debentures / Preference Shares ) as on the latest quarter end -Nil

(viii) Details of default, if any, including therein the amount involved, duration of default and present status, in repayment of – (a) statutory dues; Nil (b) debentures and interest thereon; Nil (c) deposits and interest thereon; Nil (d) loan from any bank or financial institution and interest thereon. Nil

(ix) Details of all default/s and/or delay in payments of interest and principal of any kind of term loans, debt

securities and other financial indebtedness including corporate guarantee issued by the Company, in the past 5 years.: Nil

(x) Details of any outstanding borrowings taken/ debt securities issued where taken / issued (i) for

consideration other than cash, whether in whole or part, (ii) at a premium or discount, or (iii) in pursuance of an option; Nil

The Company hereby confirms that it has not issued any debt securities (Debentures) or agreed to issue any debt



securities for consideration other than cash, whether in whole or in part, at a premium or discount or in pursuance of an option since inception. Nil (xi) Details of Promoters of the Company:- Mr. Bhumireddy Malla Reddy, Mr. Prakash Anand Chitrakar

and Mrs. Prameelamma Chennareddy. (i) Details of Promoter Holding in the Company as on the latest quarter end (as on September 30, 2015):




Total shareholding as % of total no of equity

shares

No of Shares

Pledged

% of Shares pledged

with respect

to shares owned.

1 BHUMI REDDY MALLA REDDY 24,25,882 24,25,882

2.96 N.A N.A

2 RAMYA CHITRAKAR 17,79,997 17,79,997

2.18 N.A N.A

3 RASHMI CHITRAKAR 17,41,884 17,41,884

2.13 N.A N.A

4 PRAMEELAMMA CH 16,51,461 16,51,461

2.02 N.A N.A

5 P A CHITRAKAR 1,414,386 1,414,386 1.73 N.A N.A

6 RENUKA CHITRAKAR 1,264,497 1,264,497

1.55 N.A N.A

7 PRASANNA LAKSHMI .B 875,622 875,622

1.07 N.A N.A

8 T.SITARAMA REDDY 870,000 870,000

1.06 N.A N.A

9 K MURALI MOHAN 821,500 821,500 1.00 N.A N.A 10 A S S R REDDY 5,03,727 5,03,727 0.62 N.A N.A

11 B VENKATA LAKSHMI 381,300 381,300

0.47 N.A N.A

12 LAKSHMI REDDY CHITTEPU 205,450 205,450

0.25 N.A N.A

13 PADMAVATHI CHITTEPU 161,780 161,780

0.20 N.A N.A

14 BHUMIREDDY LAKSHMI 112,500 112,500

0.14 N.A N.A

15 RAMAKRISHNA REDDY .P 96,893 96,893

0.12 N.A N.A

16 PRATHAP REDDY .C 90,750 90,750

0.11 N.A N.A

17 VARADA REDDY. B 23,331 23,331

0.03 N.A N.A

18 CHANDRASEKARA REDDY G 49,620 49,620

0.06 N.A N.A

19 SUBRAMANYAM J 29,995 29,995 0.04 N.A N.A 20 G THULASI DEVI 12,045 12,045 0.01 N.A N.A

21 VENKATAMMA CHITTEPU 1,672 1,672

0.00 N.A N.A

22 NARAPU REDDY C V 50 50

0.00 N.A N.A






Total shareholding as % of total no of equity

shares

No of Shares

Pledged

% of Shares pledged

with respect

to shares owned.

TOTAL 1,45,14,342 1,45,14,342 17.74 (xii) Abridged version of Audited Consolidated (wherever available) and Standalone Financial Information

( like Profit & Loss statement, Balance Sheet and Cash Flow statement) for at least last three years and auditor qualifications , if any:

Please refer Annexure 9

(xiii) Abridged version of Latest Audited / Limited Review Half Yearly Consolidated (wherever available)

and Standalone Financial Information (like Profit & Loss statement, and Balance Sheet) and auditors qualifications, if any.:

In the absence of half yearly consolidated and standalone financial information i.e. as on September 30, 2015, our Company is enclosing abridged version of Latest Audited / Limited Review quarterly Standalone Financial Information i.e as on June 30, 2015. Please refer Annexure 10

(xiv) Any change in accounting policies during the last three years and their effect on the profits and the

reserves of the company: Nil

(xv) Any material event/ development or change having implications on the financials/credit quality (e.g. any material regulatory proceedings against the Issuer/promoters, tax litigations resulting in material liabilities, corporate restructuring event etc) at the time of issue which may affect the issue or the investor’s decision to invest / continue to invest in the debt securities: NIL

(xvi) A summary of material legal proceedings where the amount involved exceeds ` 1 million and certain

other litigation we consider material is set forth below The Commissioner of Custom, Central Excise and Service Tax (“Authority”) issued a show cause

notice number 162/2013- Adj(Commr) CE dated September 4, 2013 (“Show Cause Notice") to our

Company, to show cause as to why (1) duty of ` 12.41 million on goods cleared from December 2009 to February 2011 should not be paid under section 11 A of the Central Excise Act, 1944, (2) duty of ` 12.39 million already paid under protest should not be adjusted against demand raised, (3) interest at applicable rates not be charged on ` 12.41 million and penalty not be imposed on them. Our Company has filed its reply dated October 17, 2013 denying all the contentions taken in the Show Cause Notice. Subsequently, the Authority vide order dated September 26, 2014 appropriated duty already paid under protest against the duty demanded and confirmed the demand of ` 12.41 along with penalty of ` 12.41 million and interest. Aggrieved, our Company filed an appeal number E/23491 of 2014 dated November 3, 2014 praying to quash or set aside the Order and to allow exemption notification 63/1995. The matter is currently pending. Further there is no inquiry, inspections or investigations initiated or conducted under the Companies Act or any previous company law in the last three years immediately preceding the year of circulation of offer letter in the case of company and all of its subsidiaries. Also there were no prosecutions filed (whether pending or not) fines imposed, compounding of offences in the last three years immediately preceding the year of the offer letter and if so, section-wise details thereof for the company and all of its subsidiaries

(xvii) The names of the debenture trustee(s) shall be mentioned with statement to the effect that debenture

trustee(s) has given his consent to the Issuer for his appointment under regulation 4 (4) and in all the



subsequent periodical communications sent to the holders of debt securities. Axis Trustee Services Limited has vide its letter dated August 10, 2015 given its consent to the Issuer for his appointment under regulation 4 (4) to act as the debenture trustee for the present issue.

(xviii) The detailed rating rationale (s) adopted (not older than one year on the date of opening of the issue)/

credit rating letter issued (not older than one month on the date of opening of the issue) by the rating agencies shall be disclosed: Please refer Annexure 7.

(xix) If the security is backed by a guarantee or letter of comfort or any other document / letter with similar

intent, a copy of the same shall be disclosed. In case such document does not contain detailed payment structure (procedure of invocation of guarantee and receipt of payment by the investor along with timelines), the same shall be disclosed in the offer document: Not Applicable

Names of all the recognized stock exchanges where the debt securities are proposed to be listed clearly indicating the designated stock exchange. The debt issue is to be listed on the Wholesale Debt Segment of BSE Limited, which is the designated stock exchange. Disclosures with regard to interest of directors, litigation etc: • Details of any financial or other material interest of the directors, promoters or key managerial

personnel in the offer and the effect of such interest in so far as it is different from the interests of other persons: Not Applicable.

• Details of any litigation or legal action pending or taken by any Ministry or Department of the Government or a statutory authority against any promoter of the offeree company during the last three years immediately preceding the year of the circulation of the Shelf Disclosure Document and any direction issued by such Ministry or Department or statutory authority upon conclusion of such litigation or legal action shall be disclosed

Not Applicable

• Remuneration of current directors (during the current year and last three financial years); (` in millions)

Names of the Directors From April 2015 to August 2015

March 31, 2015

Fiscal 2014

Fiscal 2013

Mr. Bhumireddy Malla Reddy 1.69 12.82 11.74 12.03 Mr. Prakash Anand Chitrakar 1.69 12.94 11.94 12.21 Mrs. Prameelamma Chennareddy 1.69 12.77 11.96 12 Mr. Shiban Kishen Koul 0.02 1.2 1.32 0.91 Mr. Gurunatha Reddy Sonnapureddy 1.77 7.95 7.34 - Mr. Maram Venkateshwar Reddy 1.69 8.01 7.53 - Mr. Ramachandru Tejavath 0.02 1.2 0.65 - Mr.Ganapathi Subramani Sabarinathan 0.01 - - - Mr. Umayi Kuppusamy Kalyanaramudu 0.02 0.89 - -

• Related party transactions entered during the last three financial years immediately preceding the year of

circulation of Shelf Disclosure Document including with regard to loans made or, guarantees given or securities provided: Please refer Annexure 5.

• Summary of reservations or qualifications or adverse remarks of auditors in the last five financial years immediately preceding the year of circulation of Shelf Disclosure Document and of their impact on the



financial statements and financial position of the company and the corrective steps taken and proposed to be taken by the company for each of the said reservations or qualifications or adverse remark NIL

Details of acts of material frauds committed against the company in the last three years, if any, and if so, the action taken by the company:

NIL

FUTURE BORROWINGS The Company shall be entitled, from time to time, to make further secured / unsecured borrowings for meeting its business purpose / working capital requirements without consent from the debenture holders, subject to the condition that the Consolidated net debt of the Company(on a consolidated basis) does not exceed Rs 250 Crs. The Company shall also be entitled to borrow from the promoter as and when the need be without consent from the debenture holders, subject to the condition that the loans from Promoters should be subordinated to the payment obligations with respect to Debentures.



TERMS OF OFFER This is a Confidential Shelf Disclosure Document setting out the terms and conditions pertaining to the issue of Rated Listed Secured Redeemable Non Cumulative Taxable Non-Convertible Debentures to be issued by the Company. Your participation and subscription is subject to the completion of the Application Form and submission of relevant documents. AUTHORITY

The Debentures are being issued pursuant to the resolution of the Board of Directors of the Company, passed on April 2, 2015 and resolution passed by the shareholders on May 12, 2015 and are also subject to the provisions of the Memorandum and Articles of Association of the Company. The present Issue is within the general borrowing limits set out in the resolution passed under section 180 (1) (c) of the Companies Act, 2013, at the Annual General Meeting of the Company held on July 31, 2014.The Company hereby confirms that it is entitled to raise money through current issue of Debentures with the consent/ permission/ approval from the Debenture holders/ Trustees/ Lenders/ other creditors of the Company, wherever applicable. Fictitious Application All fictitious applications will be rejected. As a matter of abundant caution and although not applicable in the case of the Debentures, attention of applicants is specially drawn to the provisions of subsection (1) of Section 38 of the Companies Act, 2013: “Any person who: (a) makes or abets making an application in a fictitious name to a company for acquiring, or

subscribing for, its securities; or (b) makes or abets making of multiple applications to a company in different names or in different combinations of his name or surname for acquiring or subscribing for its securities; or (c) otherwise induces directly or indirectly a company to allot, or register any transfer of, Debentures therein, to him, or any other person in a fictitious name, shall be liable for action under the Companies Act, 2013”. Basis of Allotment Notwithstanding anything stated elsewhere, the Issuer reserves its full, unqualified and absolute right to accept or reject any application, in part or in full, re-size the Issue including the Series size, without assigning any reasons thereof. The investors will be required to remit the Paid-Up Amount as well as submit the duly completed Application Form along with other necessary documents to the Issuer. COMPUTATION OF INTEREST

Interest for each of the interest period shall be computed on an Actual/Actual days basis, on the Principal outstanding on the Debentures at the applicable Coupon Rate. Record date Record date for the purpose of payment of interest shall be at least 15 days prior to each interest payment date, and 15 days prior to the date of maturity. RIGHT TO ACCEPT OR REJECT APPLICATIONS

The Company is entitled at its sole and absolute discretion, to accept or reject any application, in part or in full, without assigning any reason thereto. The Application Forms, which are not complete in all respects, are liable to be rejected. The rejected applicants will be intimated along with the refund warrants, if applicable. STOCK EXCHANGE WHERE SECURITIES ARE PROPOSED TO BE LISTED

The Rated, Listed, Secured, Redeemable, Non-Cumulative, Taxable Non-Convertible Debentures are proposed to be listed on the Wholesale Debt Market (WDM) Segment of the Bombay Stock Exchange Limited ( BSE). The Company has obtained an in-principle approval from the BSE dated [•] for listing of said Debentures on its



Wholesale Debt Market (WDM) Segment. WHO CAN APPLY

Only the persons who are specifically addressed through a communication directly by the Company and only such recipients are eligible to apply for the Debentures. No other person can apply. The categories of investors eligible to invest in the Debentures, when addressed directly, include HNIs, companies and body corporates, banks, financial institutions, insurance companies, mutual funds and such other category of investor as expressly authorised to invest in the Debentures. Furthermore, NRIs, OCBs, FIIs and other persons resident outside India are not eligible to apply for or hold the Debentures. All investors are required to comply with the relevant regulations/guidelines applicable to them for investing in this Issue. In the following paragraphs, the procedure for making applications along with enabling provisions is given. However, the applicants should verify independently their eligibility to make an application under this issue. By Commercial Banks The applications must be accompanied by certified true copies of (i) Document authorizing investment, (ii) Specimen signatures of authorized signatories and (iii) Power of Attorney. By Corporate Bodies/Companies/Financial Institutions The application must be accompanied by certified true copies of (i) Memorandum and Articles of Association/Constitution/Bye-laws (ii) Resolution authorizing investment and containing operating instructions (iii) Specimen signatures of authorized signatories and (iv) Order under section 197 of the Income Tax Act, 1961 from the Assessing Officer for claiming exemption from deduction of tax at source on the interest income. By Mutual Funds The application must be accompanied by certified true copies of (i) SEBI Registration Certificate (ii) Resolution authorizing investment and containing operating instructions and (iii) Specimen signatures of authorized signatories. HOW TO APPLY

Investors are required to send application for investing in the Debentures, to the office of either of the Arrangers. Applications for the Debentures must be made in the prescribed form, and must be completed in block letters in English. The format of the Application Form is enclosed. Applications complete in all respects (along with all necessary documents as detailed in the memorandum of information) must be submitted before the last date indicated in the issue time table or such extended time as decided by the Company. Applications not completed in the said manner are liable to be rejected. Application forms must be accompanied by a RTGS/demand draft or cheque, drawn or made payable at par value in favour of “Astra Microwave Products Limited - NCD Account” only Cheques/demand drafts may be drawn on any bank including a co-operative bank, which is a member or sub-member of the Banker’s Clearing House located at any of the places where the collection centers mentioned in

the application form are located. Investors in centers which do not have any bank, including a co-operative bank, which is a member or sub-member of the Banker’s Clearing House located at the above mentioned centers, will be required to make

payments only through demand drafts payable at any one of the centers mentioned in the application form.



Cash, outstation cheques, money orders, postal orders and stock invest will not be accepted. The Company assumes no responsibility for any applications/cheques/demand drafts lost in mail. Applications under Power of Attorney A certified true copy of the power of attorney or the relevant authority as the case may be along with the names and specimen signature(s) of all the authorized signatories and the tax exemption certificate/ document, if any, must be lodged along with the submission of the completed Application Form. Further modifications/ additions in the power of attorney or authority should be notified to the Company or to its Registrars or to such other person(s) at such other address (es) as may be specified by the Company from time to time through a suitable communication. PAN/GIR Number All applicants should mention their Permanent Account Number or the GIR Number allotted under Income Tax Act, 1961 and the Income Tax Circle/ Ward/ District. In case where neither the PAN nor the GIR Number has been allotted, the fact of such a non-allotment should be mentioned in the Application Form in the space provided. Acknowledgements No separate receipts will be issued for the application money. However, the Bankers to the Issue receiving the duly completed Application Form will acknowledge receipt of the application by stamping and returning to the applicant the Acknowledgement slip at the bottom of each Application Form. Right to Accept or Reject Applications The Company reserves its full, unqualified and absolute right to accept or reject any application, in part or in full, without assigning any reason thereof. The application forms that are not complete in all respects and are varying with the commitment letter are liable to be rejected and would not be paid any interest on the application money. Debenture holder not a Shareholder The Debenture holders will not be entitled to any of the rights and privileges available to the shareholders. If, however, any resolution affecting the rights attached to the Debentures is placed before the members of the Company, such resolution will first be placed before the Debenture holders for their consideration. Tax Deduction at Source

Tax as applicable under the IT Act or any other statutory modification or re-enactment thereof will be deducted at source on the interest payable on the Debentures. Tax exemption certificate/document/form, under Section 193 of the IT Act if any, must be lodged at the Registered Office of the Issuer, at least 15 days before the relevant interest payment becoming due. Tax exemption certificate / declaration of non-deduction of tax at source on interest on application money, should be submitted along with the application form.

The Issuer shall be entitled to deduct appropriate taxes or other deductions as required to be withheld on the redemption amount or any other Debenture payments at the rates prevailing from time to time under the provisions of the IT Act or any other law, or any other statutory modification or re-enactment thereof. In case any Debenture holder wishes to avail a lower rate of withholding tax pursuant to the provisions of any tax treaty entered into by India with the country of residence of such Debenture holder, then such Debenture holder shall need to provide an appropriate representation / documentation to the satisfaction of the Issuer for claiming a lower rate of withholding tax under the respective tax treaty. Debenture Redemption Reserve



The Issuer shall maintain the debenture redemption reserve as per Section 71(4) of the Companies Act, 2013 read with Rule 18(7) of Companies (Share Capital and Debentures) Rules, 2014 and circulars issued by Central Government in this regard. The Company undertakes that it shall create such reserve and shall maintain the amounts prescribed by law to be maintained in such reserve. MATERIAL CONTRACTS & AGREEMENTS INVOLVING FINANCIAL OBLIGATIONS OF THE ISSUER

Our Company, in the ordinary course of its business, enters into various agreements, including loan agreements and joint venture agreements, which may contain certain financial obligations and/or provisions which may have an impact on its financial condition. Such contracts or agreements may be inspected at the Registered Office from 11.00 am to 1.00 pm from the date of this Shelf Disclosure Document, until the date of closure of this Issue. Mentioned below is an illustrative list of certain material contracts and agreements having certain financial obligations entered into by our Company as on date of this Shelf Disclosure Document. (a) Memorandum and Articles of Association of the Company as amended from time to time.

(b) Board Resolution dated April 2, 2015 and Shareholders Resolution May 12, 2015 authorizing issue of

Debentures offered under terms of this Shelf Disclosure Document.

(c) Letter of consent from Axis Trustee Services Limited for acting as Trustees for and on behalf of the holder(s) of the Debentures.

(d) Letter from BSE conveying its in-principle approval for listing of Debentures.

(e) Letter from CRISIL Limited conveying the credit rating for the Debentures of the Company and the rating rationale pertaining thereto.

(f) Tripartite Agreement between the Company, CDSL and Link Intime Limited for issue of Debentures in dematerialised form

(g) Resolution of our shareholders dated July 31, 2014 authorising our Board to borrow for the purpose of the Company, upon such terms and conditions as the Board may think fit, not exceeding the aggregate of the paid up capital and free reserves by more than ` 10,000 million.

NOTICES

The notices to the Debenture holder(s) required to be given by the Company or the Trustees shall be deemed to have been given if sent by ordinary post to the sole/first allottee or sole/first registered holder of the Debentures, as the case may be. All notices to be given by the Debenture holder(s) shall be sent by registered post or by hand delivery to the Company or to such persons at such address as may be notified by the Company from time to time.



DISCLOSURE REQUIREMENTS UNDER FORM PAS-4 PRESCRIBED UNDER THE COMPANIES ACT, 2013

The table below sets out the disclosure requirements as provided in PAS-4 and the relevant pages in this Shelf Disclosure Document where these disclosures, to the extent applicable, have been provided.

Sr. No.

Disclosure Requirements Relevant Page of this


1. GENERAL INFORMATION a. Name, address, website and other contact details of the company indicating

both registered office and corporate office. Cover page

b. Date of incorporation of the company. 26 c. Business carried on by the company and its subsidiaries with the details of

branches or units, if any. 22-23

d. Brief particulars of the management of the company. 29-30 e. Names, addresses, DIN and occupations of the directors. 30-33 f. Management's perception of risk factors. 12-16 g. Details of default, if any, including therein the amount involved, duration of

default and present status, in repayment of: Not Applicable

(i) Statutory dues; Not Applicable (ii) Debentures and interest thereon; Not Applicable (iii) Deposits and interest thereon; and Not Applicable (iv) Loan from any bank or financial institution and interest thereon. Not Applicable h. Names, designation, address and phone number, email ID of the nodal/

compliance officer of the company, if any, for the private placement offer process.

21

2. PARTICULARS OF THE OFFER a. Date of passing of board resolution. 43 b. Date of passing of resolution in the general meeting, authorising the offer of

securities. 43

c. Kinds of securities offered (i.e. whether share or debenture) and class of security.

Cover page, 9 and 40

d. Price at which the security is being offered including the premium, if any, along with justification of the price.

Cover page

e. Name and address of the valuer who performed valuation of the security offered.

Not Applicable

f. Amount which the company intends to raise by way of securities. Cover page g. Terms of raising of securities: (i) Duration, if applicable; Not Applicable (ii) Rate of dividend or rate of interest Not Applicable (iii) Mode of payment Not Applicable (iv) Repayment Not Applicable h. Proposed time schedule for which the offer letter is valid Cover page i. Purposes and objects of the offer 47 j. Contribution being made by the promoters or directors either as part of the

offer or separately in furtherance of such objects Not Applicable

k. Principle terms of assets charged as security, if applicable Not Applicable 3. DISCLOSURES WITH REGARD TO INTEREST OF DIRECTORS,

LITIGATION ETC.

(i) Any financial or other material interest of the directors, promoters or key managerial personnel in the offer and the effect of such interest in so far as it is different from the interests of other persons

38

ii. details of any litigation or legal action pending or taken by any Ministry or Department of the Government or a statutory authority against any promoter of the offeree company during the last three years immediately

38



Sr. No. Disclosure Requirements

Relevant Page of this Shelf Disclosure

Document preceding the year of the circulation of the offer letter and any direction issued by such Ministry or Department or statutory authority upon conclusion of such litigation or legal action shall be disclosed

iii. remuneration of directors (during the current year and last three financial years)

38

iv. Related party transactions entered during the last three financial years immediately preceding the year of circulation of offer letter including with regard to loans made or, guarantees given or securities provided

38

v. Summary of reservations or qualifications or adverse remarks of auditors in the last five financial years immediately preceding the year of circulation of offer letter and of their impact on the financial statements and financial position of the company and the corrective steps taken and proposed to be taken by the company for each of the said reservations or qualifications or adverse remark

38

vi. Details of any inquiry, inspections or investigations initiated or conducted under the Companies Act or any previous company law in the last three years immediately preceding the year of circulation of offer letter in the case of company and all of its subsidiaries. Also if there were any prosecutions filed (whether pending or not) fines imposed, compounding of offences in the last three years immediately preceding the year of the offer letter and if so, section-wise details thereof for the company and all of its subsidiaries

37

vii. Details of acts of material frauds committed against the company in the last three years, if any, and if so, the action taken by the company

39

4. FINANCIAL POSITION OF THE COMPANY a. the capital structure of the company in the following manner in a tabular

form: 26

i. a the authorised, issued, subscribed and paid up capital (number of securities, description and aggregate nominal value)

26

b. size of the present offer Cover page c. paid up capital:

A. after the offer 26

B. after conversion of convertible instruments (if applicable) Not applicable d. share premium account (before and after the offer) 26 ii. the details of the existing share capital of the issuer company in a tabular

form, indicating therein with regard to each allotment, the date of allotment, the number of shares allotted, the face value of the shares allotted, the price and the form of consideration Provided that the issuer company shall also disclose the number and price at which each of the allotments were made in the last one year preceding the date of the offer letter separately indicating the allotments made for considerations other than cash and the details of the consideration in each case

26-28

Not Applicable

b. Profits of the company, before and after making provision for tax, for the three financial years immediately preceding the date of circulation of offer letter

29

c. Dividends declared by the company in respect of the said three financial years; interest coverage ratio for last three years (Cash profit after tax plus interest paid/interest paid)

29

d. A summary of the financial position of the company as in the three audited balance sheets immediately preceding the date of circulation of offer letter

37

e. Audited Cash Flow Statement for the three years immediately preceding the 37



Sr. No. Disclosure Requirements

Relevant Page of this Shelf Disclosure

Document date of circulation of offer letter

f. Any change in accounting policies during the last three years and their effect on the profits and the reserves of the company.

37

5. DECLARATION BY THE DIRECTORS 65



ANNEXURE 1: TERM SHEET

Security Name 10.58% Astra NCD 2015.

Debenture Trustee Axis Trustee Services Limited

Issuer Astra Microwave Products Limited

Type of Instrument Rated, Listed, Secured, Redeemable, Non-Cumulative, Taxable Non-Convertible Debentures (“NCDs” or “Debentures”)

Nature of Instrument Secured

Seniority Senior

Mode of Issue Private placement in multiple tranches

Eligible Investors Only the persons who are specifically addressed through a communication directly by the Company and only such recipients are eligible to apply for the Debentures. No other person can apply. The categories of investors eligible to invest in the Debentures, when addressed directly, include HNIs, companies and body corporates, banks, financial institutions, insurance companies, mutual funds and such other category of investor as expressly authorised to invest in the Debentures. Furthermore, NRIs, OCBs, FIIs and other persons resident outside India are not eligible to apply for or hold the Debentures. All investors are required to comply with the relevant regulations/guidelines applicable to them for investing in this Issue.

Listing (including name of Stock Exchange(s) where it will be listed and timeline for listing)

The NCDs issued under this document are proposed to be listed on the BSE. The NCDs will be listed around [•] 2015. In case the Debentures are not listed within 10 days of Deemed Date of Allotment for any reason whatsoever, the Issuer shall be required to immediately redeem all the Debentures from the Debenture Holders along with the interest accrued from the deemed date of allotment at the Interest Rate till the date of redemption.

Rating of the Instrument Rated ‘CRISIL A+/Stable’ by CRISIL Limited.

Paid Up Amount 10,00,000 per debenture

Issue Size /Investment amount Rs.100 Crs

Option to retain over subscription (Amount) Not Applicable

Objects of the Issue / Details of the utilization of the Proceeds

Issue proceeds will be utilized for following purposes:

Repayment of existing debt

Capital expenditure

Long term working capital requirement

General Corporate Purpose for ordinary



course of business including investment in joint venture etc.

Payment of the expenses related to the Issue, including the fees of the Arrangers

No part of the proceeds would be utilized directly/indirectly towards capital markets, land acquisition or usages as restrictive for bank finances

Coupon Rate / Interest Rate 10.58% compounded quarterly from the Deemed Date of Allotment to the Maturity Date.

Step Up/Step Down Coupon Rate In case of downgrade in external credit rating of the NCDs, the Interest Rate for the balance period would increase by 0.25% p.a. for each notch downgrade in rating and the same will be with effect from the rating downgrade date In case of rating from multiple rating agencies, lowest rating available for long-term borrowing shall be considered for the above purpose

Coupon Payment Frequency Annually

Coupon payment dates Dates on which coupon will be paid.

Coupon Type Fixed

Coupon Reset Process (including rates, spread, effective date, interest rate cap and floor etc.).

Not Applicable

Day Count Basis Actual/Actual

Interest on Application Money Interest at the Interest Rate (subject to deduction of income tax under the provisions of the Income Tax Act, 1961, or any other statutory modification or re-enactment thereof, as applicable) will be paid to the applicants on the application money for the NCDs for the period starting from and including the date of realization of application money in Issuer’s Bank Account upto one day prior to the Deemed Date of Allotment. Where Pay-in Date and Deemed Date of Allotment are the same, no interest on Application money is to be paid

Default Interest Rate In case of default in payment of interest and/or principal redemption on the due dates, additional interest @ 2% p.a. over the Interest Rate will be payable by the Issuer for the defaulting period.

Tenor 50% to be repaid at the end of 30 months from the date of Issue Remaining 50% to be repaid at the end of 36 months from the date of Issue]

Repayment 50% to be repaid at the end of 30 months from the date of Issue Remaining 50% to be repaid at the end of 36 months from the date of Issue

Redemption Date [●]

Redemption Amount The sum of the outstanding principal accrued Coupon, Default Interest payable (if any) and trustee



fees payable. Early Redemption The Debentures along with accrued interest shall

become due and payable within 7 calendar days upon receipt of written notice from Debenture Trustee of happening of any of the following events (“Early Redemption Events”): 1. Rating of the Debentures is downgraded to

“BBB+” or below. In case the NCDs are downgraded to credit rating to BBB+ or lower by CRISIL Limited, the debenture holders can exercise the right to demand early redemption of the NCDs.

2. Any Material Adverse Effect occurs. 3. Any change in the below team

Mr.B.Malla Reddy

Mr.P.A.Chitrakar

Mr.C.Prameelamma

Mr.M.V.Reddy

Mr.S.Gurunatha Reddy

or re-organisation of the above team done without the prior written approval of debenture holders. The occurrence of events above will be determined by the Debenture Holders solely and at its discretion. The Debenture Holders shall have the option to require the Company to redeem the Debentures (“Early Redemption Option”) on happening of any of the Early Redemption Events. Upon the exercise of the Early Redemption Option by the Debenture Holders, the Debenture Trustee shall issue a notice to the Company for redemption of all amounts outstanding in relation to the Debentures (including any unpaid principal, accrued but unpaid Coupon, Default Interest (if applicable)) as on the date of exercise of the Early Redemption Option (“Early Redemption Date”).

Redemption Premium/Discount Not Applicable

Issue Price At Par

Discount at which security is issued and the effective yield as a result of such discount.

Not Applicable

Put Date Not Applicable

Put Price Not Applicable

Call Date Not Applicable

Call Price Not Applicable

Put Notification Time Not Applicable



Call Notification Time Not Applicable

Face Value Rs 10 lakhs per Debenture

Minimum Application and in multiples of Debt securities thereafter

Minimum application of ten NCDs and in multiples of one NCD thereafter.

Issue Timing 1. Issue Opening Date 2. Issue Closing Date 3. Pay-in Date 4. Deemed Date of Allotment

[●]

Issuance mode of the Instrument Demat only (for private placement)

Trading mode of the Instrument Demat only (for private placement)

Settlement mode of the Instrument All cheques/drafts/transfers/RTGS must be made payable to “Astra Microwave Products Limited- NCD Account”. Details for RTGS payments are mentioned in the instructions as part of the application form in Annexure IV.

Depository National Securities Depository Ltd. (NSDL) and the Central Depositary Services (India) Limited (CDSL)

Business Day Convention ‘Business Day’ shall be a day on which commercial banks are open for business in the city of Mumbai. Payment shall be done as per SEBI circular.

Record Date 15 days prior to each Coupon Payment Redemption date.

Security (where applicable) (Including description, type of security, type of charge, likely date of creation of security, minimum security cover, revaluation, replacement of security).

The outstanding Facility amount, together with interest, redemption premium, default interest remuneration of the Trustee, charges, fees, expenses and all other monies due from the Borrower, shall be secured by (to the satisfaction of the NCD holders): First pari passu charge over movable property/ fixed assets of the company both present and future other than those assets that are exclusively charged and any other security as mutually agreed between the NCD holder and the Issuer. Security Cover of 1.25 times to be maintained on the Outstanding Facility Amount at all times during the tenure of the Facility. For the purpose of calculating security cover, land and building will be taken at market value.

Security Creation In the event of delay in security creation, issuer shall pay penal interest of 2% per annum over the Interest Rate for the delayed period till such conditions are complied.

Transaction Documents The Issuer has executed/ shall execute the documents including but not limited to the following, as required, in connection with the Issue as per latest RBI guidelines/SEBI guidelines/ Companies Act 2013 for issuance of NCDs through Private Placement: 1. Security documents i.e Deed of Hypothecation /



Mortgage 2. Letter appointing Trustees to the Debenture

holders; 3. Debenture Trustee Agreement; 4. Debenture Trust Deed; 5. Rating Agreement with the aforesaid rating

agency(ies) as regards to this Issue; and 6. Tripartite Agreements between the Issuer,

Registrar and NSDL and Tripartite Agreements between the Issuer, Registrar and CDSL for issue of NCDs in dematerialized form.

Conditions Precedent to Disbursement The Company shall fulfill the following Conditions Precedent, to the satisfactions of the Debenture Trustee, prior to the Pay In Date: (i) A certified true copy of the constitutional

documents of the Company (being its Memorandum and Articles of Association and Certificate of Incorporation) shall have been submitted to the Debenture Trustee

(ii) All corporate approvals from the Board of Directors and shareholders of the Company, if applicable, shall have been received for the issuance of the NCDs, creation of the Security and the execution, delivery and performance by the Company of the Transaction Documents in accordance with the Companies Act, 2013, the Companies (Prospectus and Allotment of Securities) Rules, 2014, the Companies (Share Capital and Debentures) Rules, 2014 and other rules prescribed;

(iii) Execution of the Debenture Trustee Agreement and Debenture Trust Deed, in a form and manner satisfactory to the Debenture Trustee shall have taken place and Company will get 90 days for making the required filings of Debenture Trust Deed ;

(iv) The Company shall have created and perfected the security in respect of the NCD’s, which shall entail including without limitation payment of requisite stamp duty on this Deed and the other Transaction Documents, as may be required under the Applicable Laws, filing of Form CHG 9 pursuant to Rule 3 of Companies (Registration of Charges) Rules, 2014 with the concerned Registrar of Companies, before the Pay In Date and Company will get 90 days for perfection of the security ;

(v) Rating of the Debentures being completed and the rating agency having provided a minimum rating of ‘A+’ for the Debentures and the rating letter issued by the Rating Agency being in a form and manner satisfactory to the Debenture



Trustee; (vi) Receipt of in-principle approval from BSE for

listing of the Debentures; (vii) The Debenture Trustee shall have received a

legal opinion, to the comfort of the Debenture Trustee on the validity and enforceability of the Transaction Documents, to the satisfaction of the Debenture Trustee;

(viii) The Company shall have provided to the Debenture Trustee a certificate from a director/company secretary of the Company certifying that:-

(a) the Company and its Directors have the necessary powers under the Memorandum and Articles of Association of the Company to borrow moneys pursuant to the issuance of the Debentures;

(b) the borrowing of moneys pursuant to the issuance of the Debentures and the creation of Security will not cause any limit binding on the Company to be exceeded;

(c) no Material Adverse Effect has occurred in the Company, and/or the business of the Company;

(d) the Company has obtained all necessary consents and approvals, if applicable, from including but not limited to its creditors, secured or unsecured, for the issuance of the Debentures and creation of Security; shall have been delivered in a form and manner satisfactory to the Debenture Trustee;

(ix) The delivery by the Company to the Debenture Trustee, of certificates signed by authorized signatories of the Issuer, in a form and substance satisfactory to the Debenture Trustee, with respect to: (a) incumbency and signatures; (b) accuracy of representations and

warranties required by the Debenture Trustee / Debenture Holders;

(c) absence of defaults and any Material Adverse Effect;

(d) all representations and warranties contained in this Deed are true and correct in all material respects on and as of the Deemed Date of Allotment, before and after giving effect to the Issue and to the application of the proceeds therefrom;

(e) non–occurrence of any force majeure event; and

(f) the Debenture Trustee shall have



received from the Company its audited account statements for the financial year ended 31st March 2015.

(x) Due execution of the Depository Agreements by, inter-alia, the Depository and the Issuer;

(xi) Due execution of the Tripartite Agreement by, inter-alia, the Registrar and Transfer Agent, Depository and the Issuer;

(xii) The Debenture Trustee shall have received satisfactory reports from CIBIL in respect of the Company;

(xiii) The Company shall have submitted to the Debenture Holders / Debenture Trustee, all required documents for the purpose of satisfying its respective KYC requirements; and

(xiv) No Event of Default or potential Event of Default has occurred and is continuing, or would result from such advances.

(xv) Any and all other documents / certificates as may be required by the Debenture Trustee

Condition Subsequent to Disbursement The Issuer shall ensure that the following documents are executed/ activities are completed as per time frame mentioned elsewhere in this Document: (a) The Issuer shall immediately on receipt of

funds, take on all necessary steps to, including making all applicable filings in the Registrar of Companies and obtaining all necessary approvals including filing Form PAS 5 along with the Information Memorandum and Form PAS 3 along with requisite fee within prescribed timelines;

(b) File Form PAS 5 along with the Information Memorandum with SEBI;

(c) Receive final listing approval from BSE within 10 days from Deemed Date of Allotment;

(d) Credit of demat account(s) of the allottee(s) by number of NCDs allotted within 2 Business days from the Deemed Date of Allotment;

(e) To ensure compliance with SEBI/ Companies Act 2013 for issuance of NCDs;

(f) Security will be created/ perfected within 6 months from date of allotment

(g) there are no proceedings pending against the Company (as an assessee) under the Income Tax Act, 1961 which would warrant the requirement of permission / certificate from the Assessing Officer under Section 281 of the Income Tax Act, 1961 for the creation of Security; shall have been delivered in a form and manner satisfactory to the Debenture Trustee. Further, the Company shall have a period of 30 days post the deemed date of allotment for submitting the permission under Section 281 of the Income Tax



Act, 1961 Acceleration of Redemption/ Events of Default

including provisions related to Cross Default Clause

The occurrence of any one of the following events shall constitute an “Event of Default” by the Company: (a) Failure to pay any amount due in respect of

Debentures including any installment of interest (including penal interest, if applicable) or the principal amount of the Debentures, any other monies including costs, charges, expenses incurred by the Trustee, as and when the same shall have become due and payable as per the terms of this Deed and other the Transaction Documents;

(b) Any information given by the Company in this Deed, the Information Memorandum, the Transaction Documents and/or other information furnished and/or the representations and warranties given/deemed to have been given by the Company to the Debenture Holder(s)/Beneficial Owner(s) under the Transaction Documents for financial assistance by way of subscrip¬tion to the Debentures is or proves to be misleading or incorrect in any respect or is found to be incorrect;

(c) The Company fails to comply with any of its covenants, obligations, representations or warranties laid down in this Deed or under any Transaction Documents to which it is a party;

(d) If the Issuer / subsidiaries of the company is unable to or admits in writing its inability to pay its debts as they mature or suspends making payment of any of its debts, by reason of actual or anticipated financial difficulties or proceedings for taking it into liquidation have been admitted by any competent court or a moratorium or other protection from its creditors is declared or imposed in respect of any indebtedness of the Company;

(e) If any of the following occurs in connection with the Security:

(i) Any Security Document is not (once entered into) in full force and effect or any Security Document does not (once entered into) create in favour of the Debenture Trustee the Security which it is expressed to create fully perfected with the ranking and priority



it is expressed to have; (ii) In the reasonable opinion of the Debenture

Trustee the Security created for the benefit of the Debenture Holders is in jeopardy;

(iii) Security for the Debentures is not created and perfected within the timelines as set out in this Deed and in the Transaction Documents;

(iv) The Secured Assets offered as security to the Trustee/ Debenture Holder(s)/ Beneficial Owner(s) for the Debentures are not insured or kept under-insured by the Company or the aggregate value of such Secured Assets depreciate in value to such an extent that in the opinion of the Debenture Holder(s)/ Beneficial Owner(s)/ Debenture Trustee, the minimum Security Cover of 1.25 times is not maintained and additional security, to the satisfaction of the Debenture Holder(s)/ Beneficial Owner(s)/Debenture Trustee, required to maintain the Security Cover is not given within 15 (Fifteen) Business Days of written notice by the Majority Debenture Holders/Beneficial Owners or the Debenture Trustee;

(v) The Company fails to comply with any other provisions of this Deed or other Transactions Documents in relation to the Security and Security Cover, within 2 (Two) Business Days of such failure.

(f) If without the prior approval of the Debenture Trustee and/or Debenture Holder(s) /Beneficial Owner(s), as the case may be, any land, buildings, structures, plant and machinery of the Company are sold, disposed of, charged, encumbered or alienated or the said buildings, structures, machinery, plant or other equipment are removed pulled down or demolished;

(g) The Company, the Promoter/s and/or any member of the Promoter Group rescinds / repudiates or purports to rescind / repudiate or evidences an intention to rescind / repudiate any of the Transaction Documents to in whole or in part;

(h) Any member of the key management team (as mentioned earlier) or any member of the promoter group holding more than 0.5% of the equity share capital of the Company at any point of time, being declared as willful defaulter.



(i) The Company shall have voluntarily or involuntarily become the subject of proceedings under bankruptcy or insolvency law or CDR proceedings including any corporate action, legal proceedings or other procedure or step which has been taken (including the making of an application, the presentation of a petition, the filing or service of a notice or the passing of a resolution);

(j) The Company / subsidiaries has taken or

suffered any action to be taken for its reorganization, liquidation or dissolution;

(k) A receiver or liquidator, provisional liquidator,

supervisor, receiver, administrative receiver, administrator, compulsory manager, trustee or other similar officer in respect of the Company or any of its assets is appointed or allowed to be appointed of all or any part of the undertaking of the Company;

(l) If an attachment or expropriation or restraint or

act of sequestration is levied on the Hypothecated assets or any part thereof and / or certificate proceedings are taken or commenced for recovery of any dues from the Company;

(m) Cross Default

(i) any Financial Indebtedness of the Company / subsidiaries is not paid when due and the applicable cure period has lapsed without the Company remedying the same; or

(ii) any Financial Indebtedness of the Company / subsidiaries is declared or otherwise becomes due and payable before its specified maturity as a result of an event of default; or

(iii) any creditor of the Company / subsidiaries becomes entitled to declare any Financial Indebtedness of the Company due and payable before its specified maturity as a result of an event of default

(n) If the Company suspends, ceases or threatens to suspend or cease to carry on its business or gives notice of its intention to do so;

(o) If the Company is declared a sick undertaking under the provisions of the Section 3(1)(o) of the Sick Industrial Undertakings (Special Provisions) Act, 1985 or under section 2(46)(AA) of the



Companies Act 1956 if a reference has been made to BIFR by a creditor under the said Act and the Company has not resolved the complaint or is nationalized or is under the management of the Central Government

(p) All or a material part of the undertaking, assets,

rights or revenues of the Company are condemned, seized, nationalised, expropriated or compulsorily acquired, or shall have assumed custody or control of the business or operations of the Company, or shall have taken any action for the dissolution of the Company, or any action that would prevent the Company, their member, or their officers from carrying on their business or operations or a substantial part thereof, by or under the authority of any Government or Government authority;

(q) Any material act of fraud, embezzlement,

misstatement, misappropriation or siphoning off of the Issuer / Promoter funds or revenues or any other act having a similar effect being committed by the management or an officer of the Issuer

(r) The Company has taken or suffered to be taken

any action for re-organisation of its capital or any rearrangement, merger or amalgamation without the prior written approval of the Debentureholders;

(s) Change in Control of the Company (t) Transfer and/or the creation of an Encumbrance

on the shareholding in the Company of any member of the promoter group holding more than 0.5% of the equity share capital of the Company at any point of time without prior written approval or sanction of the Debenture Trustee

(u) No change in management control & the

current promoters to hold atleast 13% stake in the company taken on fully diluted basis

(v) Any Transaction Document once executed and

delivered, ceases to be in full force and effect or becomes unlawful, invalid or unenforceable or fails to provide the Debenture Trustee and the Debentureholder(s)/Beneficial Owners(s) with the interests in the Security intended to be created thereby;



(w) Any of the necessary clearances required or

desirable in relation to the business or operation of the Company or the Debentures in accordance with any of the Transaction Documents is not received or is revoked or terminated, withdrawn, suspended, modified or withheld or shall cease to be in full force and effect which shall, in the opinion of Debenture Holder(s)/Beneficial Owners(s), have Material Adverse Effect on the project or Company or the Debentures;

(x) A petition for the reorganization, arrangement,

adjustment, winding up or composition of debts of the Company is filed on the Company (voluntary or otherwise) or have been admitted or makes an assignment for the benefit of its creditors generally and such proceeding is not contested by the company for staying, quashing or dismissed within 15 (fifteen) days;

(y) If any member of the promoter group holding

more than 0.5% of the equity share capital of the Company at any point of time and /or the directors of the Company are accused of, charged with, arrested or convicted a criminal offence involving moral turpitude, dishonesty or which otherwise including any accusations, charges and/or convictions of any offence relating to bribery

(z) It is or becomes unlawful for the Company to

perform any of its obligations under any Transaction Document

(aa) Occurrence of force majeure events like fire,

flood, earthquake, strike, lock out, civil unrest, terror attacks etc. which has resulted in damage to the Secured Assets or which adversely affects the ability of the Company: (a) to pay the principal, interest, or any other amount payable under the terms of the Debentures; and/or (b) to perform any other obligations under the Transaction Documents to which it is a party

(bb) The Company is adjudged insolvent or takes

advantage of any law for the relief of insolvent debtors

(cc) Event of death of any member of the key

management team (as mentioned earlier) or any member of the promoter group holding more



than 0.5% of the equity share capital of the Company at any point of time.

Role and Responsibilities of Debenture Trustee Role and responsibilities of debenture trustee are outlined in the Debenture trustee agreement/ debenture trust deed entered/to be entered between the issuer and the debenture trustee.

Governing Law and Jurisdiction This Term Sheet shall be governed and construed exclusively in accordance with the laws of India and any disputes arising there from shall be subject to the jurisdiction of appropriate courts and tribunals at Mumbai.

Covenants for Facility The Issuer shall provide for followings covenant for the facility. Financial Covenants for Astra Microwave Products Ltd. on consolidated basis 1) Net Debt to Equity Ratio not exceeding 1.0 times

2) Consolidated net debt not to exceed Rs.250 Crs 3) No loss on annual basis (PAT Basis) 4) Net Debt to EBIDTA not exceeding 2 times All covenants would be tested on semi-annual basis for the Company i.e. as on 31stMarch and 30th Sept every year, starting from 31st March 2016 on consolidated balance sheet till the redemption of the Debentures. The covenants shall be certified by the Company within 30 days from end of each reporting half year. “Net Debt” shall mean aggregate of 1. All long-term debt outstanding, whether secured or unsecured, plus 2. Any short term debt outstanding, whether secured or unsecured, availed of in lieu of long term debt or by way of bridge financing for long term debt 3. Any amount raised by acceptance under any acceptance credit facility 4. Receivables sold or discounted (other than any receivables to the extent they are sold on a non- recourse basis) 5. Any amount raised under any other transaction (including any forward sale or purchase agreement) having the commercial effect of a borrowing. 6. Contingent liability pertaining to corporate/ financial guarantees given on behalf of any company / SPV / subsidiary/affiliate to the extent of outstanding of such guaranteed debt, plus less a) Cash & Bank Balances and b) Investments in marketable securities inter alia including investment in liquid mutual funds and fixed deposits which are not earmarked Debt availed by Joint Ventures of the Company on a non-recourse basis shall not be included in the aforesaid definition of “Net Debt”. Further, Performance / Bank Guarantees availed by the Company for business



purposes shall also be excluded from the definition of “Net Debt” “Equity” shall mean issued and paid up Equity and Preference Share capital (+) all reserves (excluding revaluation reserves) (–) any dividend declared (+) deferred tax liability (-) deferred tax asset (-) intangibles (including but not restricted to brand valuation, goodwill etc) as per the latest audited financials of the Borrower. EBIDTA means earnings before Interest, Depreciation and Tax. For clarity it will also excludes any exceptional gain or loss & other income as classified in financial of the company and includes export incentives. Other Covenants 1) Issuer shall not amend or modify Clause in its

Memorandum of Association and Article of Association without prior consent of the Debenture Trustee/Debenture Holders

2) Issuer shall not change its financial year-end from 31st March (or such other date as may be approved by Investors) without prior consent of the Debenture Trustee/Debenture Holders

3) Issuer shall not change the accounting policies currently followed without prior consent of the Debenture Trustee/Debenture Holders unless required under the law/Accounting Standards to do so.

4) Provide consolidated financial statements at the end of financial year and standalone financial statements at the end of financial half years of Issuer

5) notification of any potential Event of Default or Event of Default;

6) obtain, comply with and maintain all licenses / authorizations;

7) No M&A, acquisition, restructuring, amalgamation without approval of debenture holders. This clause shall not be applicable to joint ventures entered into by the Issuer or investment in subsidiaries.

8) the Issuer will not purchase or redeem any of its issued shares or reduce its share capital without the investors’ prior written consent;

9) Any sale of assets/business/division or re-structuring of the existing business, to be with the prior consent of the debenture holder

10) Issuer’s net worth to remain positive during the Tenor of the Issue.

11) Subject to the condition that the Consolidated



net debt of the Company (on a consolidated basis) does not exceed Rs 250 Crs., there shall be no assumption of further debt or any other liability of any kind by the Issuer other than permitted as per the term of the NCD, exceptions to be agreed. It is clarified that Company may fully drawdown the working capital /term loan requirement of the Company from time to time, subject to the condition that the Consolidated net debt of the Company (on a consolidated basis) does not exceed Rs 250 Crs.

12) No dividend, if an Event of Default has occurred and is subsisting

13) The Issuer shall maintain its corporate existence and right to carry on its business and operations and comply with all Applicable Laws in all respects, at all times

14) The Issuer shall not, without the prior approval of Investors, enter into any transaction of merger, de-merger, consolidation, re-organization, scheme of arrangement or compromise with its creditors or shareholders or effect any scheme of amalgamation or reconstruction; provided however that this restriction shall not apply in the event that the compliance with this restriction would result in the Issuer defaulting in relation to any of its payment obligations in relation to the Debentures.

15) Not undertake any new business or any diversification of its business, without approval of NCD holders

16) Provide details of any material litigation, arbitration or administrative proceedings

17) No change in statutory auditors without prior written consent of debenture holders

18) All hypothecated mortgaged assets are free from encumbrances

19) Permit visits and inspection of books of records, documents and accounts to debenture holders as and when required by them

20) Any force majeure event Information Undertakings a. unaudited quarterly financial statements within

60 days; b. Its annual audited consolidated or

unconsolidated financial statements within 120 days from the close of the accounting year

c. Details of any material litigation, arbitration or administrative proceedings

d. Notice of any change in authorized signatories of the Issuer with respect to the facility

e. Issuer to provide end-use certificate within 3 months of Deemed Date of Allotment



confirming that no part of the Issue has been used for purpose ineligible for bank finance as per RBI guidelines

f. Promptly inform Debentures holders of change in composition of board

g. Promptly inform Debentures holders of change any change in nature and conduct of business, prior to bring in such change

Representations, Warranties The Issuer will make representations customary for the facilities of this nature and others appropriate in the judgment of the Investor, including but not limited to:

full title on all the rights, property and undertakings subject to the security (free from any litigations)

No Event of Default or potential Event of Default has occurred and is continuing and no such event or circumstance will result as a consequence of the Issuer / performing any obligation contemplated under the transaction documents.

No Material Adverse Change in business, condition or operations of the Issuer

Absence of any pending or threatened litigation, investigation or proceedings that may have a material adverse effect on the business condition (financial or otherwise), operations, performance or prospects of the Issuer or that purports to affect the Facility

Compliance with all laws and regulations (including any disclosure requirements) and procuring all relevant approvals in order to creation and perfection of the security, as may be required in relation to the Transaction.

Illegality Permitted Investment Permitted Investment shall mean investments as per

the company’s investment policy i.e primarily in fixed deposits of scheduled commercial banks and in liquid schemes of mutual funds with a minimum rating of AA or equivalent.

Confidentiality The terms and conditions described in this Term Sheet, including its existence, shall be confidential information and shall not be disclosed to any third party except to each Party’s advisors and counsel. Provided however that if any of the Parties is required by law to disclose information regarding this Term Sheet or to file this Term Sheet with any regulatory body, it shall, at a reasonable time after making any such disclosure or filing, informing the other Parties.



Transaction Costs

The Issuer shall bear all transaction related costs incurred by the Investor with respect to legal counsel, valuers and auditors/consultants. Such costs include: 1. Professional fee payable to advisors for legal due

diligence and valuation 2. Legal fee payable to Law firm engaged by the

Investor for transaction documentation and title due diligence.

3. Trustee fees and listing fees 4. Stamping and registration in relation to creation

of security and all definitive agreements. Taxes duties cost and expenses 1. Relevant taxes, duties and levies are to be

borne by the Issuer. 2. The charges / fees and any amounts payable

as mentioned herein do not include any applicable taxes, levies including service tax etc. and all such impositions shall be borne by the Issuer additionally.



ANNEXURE 2: CASH FLOWS

Cash flows emanating from the issue of NCDs

Please note that filing will be made with the BSE in relation to each tranche of the NCDs as required under Regulation 21A of the SEBI Debt Regulations. The cash flow including principal repayment and interest payment dates for each tranche of the NCDs shall be disclosed in the Trance Disclosure Document.



ANNEXURE 4: APPLICATION FORM

Application No: ___ Date: The Director, Astra Microwave Products Limited, ASTRA Towers, Survey No.12 (P), Kothaguda Post, Kondapur, Hitechcity, Hyderabad, Telangana- 500 084 Dear Sirs, Having read and understood the contents of the Shelf Disclosure Document dated [•], I/we hereby apply for allotment of the Debentures to us. The Paid Up Amount payable on application as shown below is remitted herewith. I/We irrevocably give our authority and consent to Axis Trustee Services Limited, to act as my/our trustees and for doing such acts and signing such documents as are necessary to carry out their duties in such capacity. Notwithstanding anything contained in this Shelf Disclosure Document dated [•] and the attachments hereto, I/we confirm that I/we have carefully read and understood the contents, terms and conditions of the Shelf Disclosure Document dated [•] and the attachments hereto, in their entirety and further confirm that in making my/our investment decisions I/we have relied on my/our own examination of the Company and the terms of the issue of the Debentures. On allotment, please place my/our name(s) on the Register of Debenture holder(s). I/We bind ourselves to the terms and conditions as contained in the Information Document / Shelf Disclosure Document. (Please read carefully the instructions on the next page before filling this form) Details No. of debentures applied (in figures) No. of debentures applied (in words) Paid Up Amount ( ` in figures) Paid Up Amount ( ` in words) Cheque/Demand Draft/RTGS Details Date Drawn on Bank Applicant’s Name & Address in full (please use capital letters) Pin Code: Telephone: Fax: Email: Status: Banking Company ( ) Insurance Company ( ) Mutual Fund ( ) Others ( ) – please specify Name of Authorized Signatory Designation Signature Details of Bank Account Bank Name & Branch



Nature of Account Account No.: IFSC/NEFT Code Depository Details

DP Name DP ID Client ID (*) We understand that in case of allotment of debentures to us/our Beneficiary Account as mentioned above would be credited to the extent of debentures allotted. Taxpayers PAN / GIR No.

IT Circle/Ward/District ( ) Not Allotted

Tax Deduction Status ( ) Fully Exempt ( ) Tax to be deducted at Source ( ) Yes ( ) No __________________________________(Tear here)______________________________

ACKNOWLEDGEMENT SLIP Details No.of debentures applied (in figures)

No.of debentures applied (in words)

Paid Up Amount ( ` in figures) Paid Up Amount ( ` in words) Cheque / DD/RTGS (Cheques /Demand Drafts are subject to realization) For all further correspondence please contact: Mr. T Anjaneyulu, Astra Microwave Products Limited, ASTRA Towers, Survey No.12 (P), Kothaguda Post, Kondapur, Hitechcity, Hyderabad, Telangana- 500 084.



INSTRUCTIONS

1. You must complete application in full in BLOCK LETTERS IN ENGLISH. 2. Your Signatures should be made in English or in any of the Indian languages 3. Application forms duly completed in all respects, together with Cheques/Pay Order/Demand Draft,

must be lodged at the Astra Microwave Products Limited’ head office. 4. In case of payments through RTGS, the payments may be made as follows:

Beneficiary : Astra Microwave Products Limited Bank Details : HDFC Bank Limited- Current Account Branch : Lakdikapul branch, Hyderabad Account No. : 00210330005492 IFSC Code : HDFC0000021

5. The Cheque(s)/Demand Draft(s) should be drawn in favour of "Astra Microwave Products Limited" and crossed "A/c payee" only. Cheque(s)/Demand draft(s) may be drawn on any scheduled bank and payable at Hyderabad.

6. Outstation cheques, cash, money orders, postal orders and stock invest will NOT be accepted. 7. As a matter of precaution against possible fraudulent encashment of interest warrants due to

loss/misplacement, you are requested to mention the full particulars of the bank account, as specified in the application form.

8. Interest warrants will then be made out in favour of the bank for credit to your account. In case the full

particulars are not given, cheques will be issued in the name of the applicant at their own risk. 9. Astra Microwave Products Limited in the “Acknowledgement Slip” appearing below the Application

Form will acknowledge receipt of applications. No separate receipt will be issued. 10. You should mention your Permanent Account Number or the GIR number allotted under Income-Tax

Act, 1961 and the Income-Tax Circle/Ward/District. In case where neither the PAN nor GIR number has been allotted, the fact of non-allotment should be mentioned in the application form in the space provided.

11. The application would be accepted as per the terms of the issue outlined in the Information Document / Shelf Disclosure Document.



ANNEXURE 5 RELATED PARTY TRANSACTION

The related party transactions during the years ended March 31, 2013, March 31, 2014 and March 31, 2015 are as follows

There were no materially significant related party transactions, which had potential conflict with the interests of the Company at large.

Annexure 6

Annexure 7

May 2015 www.crisilratings.com CRISIL RATINGS

CREDIT RATING REPORT

Astra Microwave Products Limited May 2015

INSTRUMENTS RATED

Total Bank Loan Facilities Rated

Long-Term Rating

Short-Term Rating

(Refer to Annexure 1 for Facility-wise details)

Rs.200 Million Commercial Paper Programme

Rs.1000 Million Non-Convertible Debenture

RATING HISTORY

Date Long-Term Fixed

Deposit Short-Term

Rating Watch/Outlook

No Rating changes in the last three years

CRISIL has assigned ‘CRISIL A+/Stable’ rating to Astra Microwave Products Ltd’s (AMPL’s) Rs.1.0-billion non-convertible debenture (NCD) programme and has reaffirmed its ratings on the company’s existing debt instrument and bank facilities at ‘CRISIL A+/Stable/CRISIL A1’. AMPL has an investment plan of Rs.1.7 billion to be funded with NCDs of Rs.1 billion and equity of Rs.700 million. The plan includes setting up a research and development (R&D) centre in Bengaluru, R&D of new products, and setting up two joint ventures (JVs) with foreign partners. AMPL will have a 51 per cent stake in these JVs. The investment plan is spread over two years, 2015-16 (refers to financial year, April 1 to March 31) and 2016-17. The NCDs will be raised over this period, while the equity of Rs.700 million is expected in 2015-16. CRISIL believes that though the investment plan is large, AMPL will judiciously fund the investment and take appropriate measures to partially offset project risks. Timely equity infusion and completion of the project without any significant time or cost overrun will be key rating sensitivity factors.

RATINGS

Rs.5960 Million

CRISIL A+/Stable (Reaffirmed)

CRISIL A1 (Reaffirmed)

CRISIL A1 (Reaffirmed)

CRISIL A+/Stable (Assigned)

Analytical Contacts at CRISIL: Sudip Sural Phone:+91 124 672 2000 Email: [email protected] Manoj Damle Phone:+91 22 3342 3342 Email: [email protected]

Customer Service Helpdesk Timings: 10:00 am to 7:00 pm Toll free number: 1800 267 1301 Email: [email protected]

Disclaimer:

CRISIL has taken due care and caution in compilation of data for this rating rationale, based upon the information provided by the issuer and also upon information obtained from sources it considers reliable. However, CRISIL does not guarantee the accuracy, adequacy or completeness of any information. CRISIL especially states that it has no financial liability whatsoever to the subscribers / users / transmitters / distributors of the rating or the rationale. No part of this rationale may be published / reproduced in any form without CRISIL's prior written approval.

A CRISIL rating reflects CRISIL's current opinion on the likelihood of timely payment of the obligations under the rated instrument and does not constitute an audit of the rated entity by CRISIL. A CRISIL rating is not a recommendation to buy, sell or hold the rated instrument; it does not comment on the market price or suitability for a particular investor. All CRISIL ratings are under surveillance. Ratings are revised as and when circumstances so warrant. CRISIL Ratings’ rating criteria are generally available without charge to the public on the CRISIL public web site, www.crisil.com. For the latest rating information on any instrument of any company rated by CRISIL, please contact CRISIL RATING DESK at [email protected], or at (+91 22) 3342 3000 - 09.

CRISIL Complexity Levels are assigned to various types of financial instruments. The CRISIL Complexity Levels are available on www.crisil.com/complexity-levels. Investors are advised to refer to the CRISIL Complexity Levels for instruments that they propose to invest in. Investors can also call the Customer Service Helpdesk with queries on specific instruments.



Rating Drivers

Strengths Established market position supported by strong in-house capabilities in microwave radio frequency

(RF) applications domain

Adequate order book and strong customer relations

Healthy financial risk profile marked by low gearing and comfortable debt protection metrics

Weaknesses Susceptibility to risks inherent in tender-based business, limited long-term revenue visibility, and

long gestation period for projects

Revenue concentration in defence sector

Working-capital-intensive operations

Rating sensitivity factors Timely equity infusion and completion of project without any considerable time or cost overrun

Pace of order inflow

Changes in defence procurement policies and government expenditure on defence

Extent of further debt-funded capital expenditure (capex)

Outlook: Stable CRISIL believes that Astra Microwave Products Ltd's (AMPL's) will continue to benefit over the medium term from its established market position and its strong in-house R&D capabilities. The outlook may be revised to ‘Positive’ if the company improves its working capital efficiency, or increases its accruals through higher operating revenue and profitability, while diversifying its customer mix, thus improving its liquidity and capital structure. Conversely, the outlook may be revised to ‘Negative’ if AMPL’s capital structure weakens considerably because of low order inflows, low pace of order execution, or a stretch in its working capital cycle. A delay in equity infusion may also result in revision in outlook to ‘Negative’.

Liquidity AMPL has adequate liquidity with most of its cash and bank balance encumbered in the form of margin money with banks. The company had Rs.277 million of cash and bank balances as of March 20151, almost 90 per cent of which is encumbered. AMPL has healthy expected annual cash accruals of about Rs.700 million over the medium term, which will be sufficient to meet its debt obligations. AMPL has an investment plan of Rs.1.7 billion which will be supported by NCDs of Rs.1 billion and equity of Rs.700 million. The investment plan is spread over two years, 2015-16 and 2016-17. CRISIL believes that though the investment plan is large, AMPL will judiciously fund the investment and with strong cash accruals, and that the company’s liquidity will be adequate over the near team.

About the Company AMPL was reconstituted as a public limited company in 1993; it was initially incorporated as a private limited company in 1991. Based in Hyderabad and promoted by Mr. B Malla Reddy, Ms. C Pramelamma, and Mr. P A Chitrakar, the company designs, develops, and manufactures customised sub-systems and components for microwave communication systems used in the defence, space, and telecommunication sectors. In July 2011, AMPL sold its 100 per cent stake in Komoline Electronics Pvt Ltd. AMPL also

1 Only abridged 2014-15 full year financials are available



floated 100 per cent owned Bhavyabhanu Electronics Pvt Ltd in 2013-14 which acts as a captive supplier of raw material for AMPL’s export orders. The year 2013-14 was the first year of its operations. AMPL delivers sub-systems and transmit/receive (T/R) modules for radars, which contributes 70 per cent to its revenue from the defence segment. Over the years, the company has been undertaking product development of T/R modules and sub-systems in different RF bands and delivering T/R modules for radar applications. AMPL is undertaking production of sub-systems for a few radars.

The ratings reflect AMPL’s following strengths: Established market position supported by its strong in-house capabilities in microwave RF applications domain AMPL has a track record of over two decades in microwave RF applications, indicating the company’s ability to weather business cycles. Its business credentials are strengthened by the extensive industry experience of its promoters, who have operated for more than 35 years in the same line of business. AMPL derives its core business strength from its in-house capabilities to provide customised microwave RF solutions in the wireless communication segment. The company has four state-of-the-art facilities in and around Hyderabad with R&D capacities for microwave RF applications, test equipment, and environment chambers for space applications. AMPL designs certain critical semi-conductor devices through its in-house R&D team and thereby secures its supply chain. The microwave RF applications’ domain has high entry barriers. A new entrant requires strong in-house R&D capabilities with an extensive and proven track record, established and long-standing relationships with defence research establishments, a significant pool of trained and qualified employees, and an adequate infrastructure for training them. Also, from the national security perspective, critical technologies in defence may not be imparted to new entrants by defence establishments. Furthermore, AMPL’s constant endeavour to upgrade its R&D capabilities and testing laboratory equipment, and create a pool of well-qualified and trained employees, has established it as a pioneer and unique player in its business domain. Over the years, AMPL has diversified its business portfolio by providing microwave applications in the space and civil telecommunication segments. AMPL is also developing systems for civilian/industrial security and weather-monitoring systems. CRISIL believes that the strong in-house capabilities of AMPL, coupled with the promoters’ extensive experience and competence in the niche microwave RF applications domain, will enable AMPL to maintain its dominant market position over the medium term. CRISIL believes that AMPL will be able to diversify its revenue across different segments, backed by its established business credentials. Adequate order book providing moderate revenue visibility and strong customer relations

AMPL has reported healthy growth in the past few years in net sales to Rs.6.34 billion in 2014-15 from Rs.1.96 billion in 2011-12, supported by strong execution of both domestic and export orders. However, the company’s reported operating margin declined to 17.4 per cent from 31.3 per cent during the same period on account of higher execution of low-margin export orders. CRISIL believes that maintenance of operating margin at its current level over the medium term will be a key monitorable. As on December 31, 2014, AMPL had a pending order book of around Rs.5.7 billion which has shrunk because of good execution and limited order inflows. The order book is expected to be executed over the next 12 to 18 months, thus providing revenue visibility over the medium term (see Chart 1). About 72 per



cent of the order book (see Chart 2) is from domestic customers and the rest is from exports (mainly ELTA). CRISIL believes that the pace of order inflow over the medium term will be a key monitorable. Order Book break-up as on March 31, 2014

Sector Rs.Mn

Defence/Public Sector Products 4,265.3

Space 521.6

Meteorological and Telecom Products 115.8

Exports 481.4

Total 9,716

Source: Annual report

Chart 1: Order book trend Chart 2: Order book mix in favour of domestic orders

Source: Company Source: Company

AMPL has long-standing relationships with its customers. The company is recognised as a qualified vendor by defence research establishments, and is also recognised by the Indian Space Research Organisation (ISRO) for its space applications’ testing laboratories. AMPL’s facilities are recognised by the Ministry of Science and Technology, Government of India (GoI), and are International Organisation for Standardisztion (ISO) 9001:2000-certified by Intertek, UK. AMPL’s prime customers include Defence Research Development Organisation (DRDO), ISRO, Bharat Electronics Ltd (BEL), and Indian Meteorological Department (IMD).

Also, the Indian government mandates foreign armament makers to source systems and armaments from Indian firms for at least 30 per cent of the value of the goods they sell to the Indian military. AMPL has gained strongly from this policy and has developed key relationships with entities in Israel such as ELTA systems since 2010 and has bagged key orders under the defence offset policy. Healthy financial risk profile

AMPL’s financial risk profile is marked by a prudent capital structure and healthy debt protection metrics. The company had gearing of about 0.3 times as on March 31, 2015 (0.25 times as on December 31, 2014). Because of the debt-funded investment plan the gearing is expected to moderate but still remain healthy (with peak gearing of 0.6 times over the medium term) because of healthy cash accruals, phased investment plan, and equity infusion of Rs.700 million to support investment. AMPL has strong debt protection metrics as reflected in net cash accruals to total debt (NCATD) and interest coverage ratios at



85 per cent and 11.1 times, respectively, for 2014-15. Because of the debt-laden investment plan, AMPL’s debt protection metrics are expected to weaken but still remain healthy with a trough in NCATD and interest coverage ratios at about 40 per cent and 5 times, respectively, over the medium term. AMPL is likely to post annual net cash accruals of about Rs.700 million over the next two years; these will be adequate to cover debt obligations of Rs.90 million to Rs.140 million over the next two years. CRISIL believes that AMPL will maintain its healthy financial risk profile over the medium term backed by its conservative gearing and healthy cash accruals.

The above-mentioned strengths are partially offset by AMPL’s following weaknesses: Susceptibility to risks inherent in tender-based business, limited long-term revenue visibility, and long gestation period for projects AMPL’s business depends on bidding successfully for tenders invited by various defence public sector undertakings and research establishments. Defence research establishments, such as DRDO, invite tenders from qualified vendors to execute its R&D requirements, and on successful completion of product development, bulk production commences. The long-term revenue visibility of AMPL is limited, as revenue is driven by the success of R&D projects at DRDO and the subsequent mass production of these products. Also, AMPL’s growth is constrained by long gestation periods associated with procurement procedures in defence establishments. Furthermore, the company’s high dependence on tender-based business restricts its revenue visibility over the medium term. However, being a unique player in the microwave RF applications segment, AMPL also gets a few tenders on a single-tender basis in a year. CRISIL believes that AMPL’s business risk profile over the medium term will be constrained by its dependence on defence establishments, low long-term revenue visibility, and long gestation periods. Revenue concentration in defence sector AMPL’s revenue is concentrated in the defence market; most of these defence projects are initiated, designed, and developed by DRDO, and are driven by government policies and priorities. Thus, as the short-term dynamics of the market are not under the company’s control, AMPL faces risks of uncertain revenue from the defence segment. The share of revenue from this segment reduced to 26 per cent in 2013-14 from 72 per cent in 2012-13 (see Table 1). Although the company has increased the proportion of revenue from the space segment, major contribution is still from the defence segment, including exports. However, with the offset clause introduced by GoI in June 2005, the company is likely to benefit from increased export orders. Presently, AMPL’s exports are to Israel in the defence segment. Table 1: AMPL Revenue mix

Revenue Segment

2013-14 2012-13

Rs. Million per cent Rs. Million per cent

Defence Products 1420.7 26 1716.8 72

Space Products 551.5 10 73.6 3

Meteorology/ Telecom 50.8 1 51.2 2

Exports 3419.4 63 541.3 23

Total 5442.4 100.0 2382.9 100.0



CRISIL believes that AMPL will gradually diversify its revenue profile to ensure that the revenue concentration in the defence segment is diluted over the medium term. The inherent order-based nature of business exposes AMPL to volatility in operating income and accruals. While AMPL diversified into international orders to reduce the dependence on domestic defence sector, there is significant client concentration in the export segment with a single client accounting for over 90 per cent of the orders. The relatively small size of AMPL makes it vulnerable to concentration risk. Working-capital–intensive operations

AMPL’s operations are working capital intensive, as indicated by its high gross current assets, at 260 days as on March 31, 2014. The company primarily caters to government organisations and the products manufactured generally have a lengthy production cycle. Also, the company has to keep a high inventory to cater to all the segments as the end products are customised as per the customer’s requirement, which varies across segments. Thus AMPL’s average inventory period is high at more than 120 days. The debtor period is also high with average receivable days at over 88 days as on March 31, 2014 and around 219 days a year earlier, and an average of around 150 days over the past three years. Moreover, the domestic business is more working capital intensive than the export business, which has better payment terms and lower inventory requirement. With expectation of higher execution of domestic orders over the medium term, CRISIL believes that AMPL’s operations will remain working capital intensive.

Financial Profile

Financial policy AMPL has a conservative financial policy. As on March 31, 2015, its gearing was at 0.3 times. The company’s capital structure is expected to remain healthy, despite a debt-laden investment plan, with peak gearing of around 0.6 times over the medium term. AMPL has no exposure to derivatives.

Profitability and cash flow protection AMPL reported an operating profit margin of 17.4 per cent for 2014-15 (17.2 per cent for 2013-14). The profitability has gradually come down from 31.3 per cent in 2011-12. The decline in operating margin is on account of strong execution of low-margin export orders. CRISIL believes AMPL’s margins will gradually increase to about 19 per cent over the medium term with higher proportion of domestic orders in the revenue mix which have a better operating margin profile. AMPL has moderate cash flow protection; the company is expected to report cash accruals of over Rs.700 million per annum which along with equity infusion of Rs.700 million will be adequate to meet its capex and debt repayment over the medium term.

Capital structure and financial flexibility AMPL’s low gearing and adequate cash accruals provide it with sufficient means to service debts. However, the financial flexibility is constrained by large working capital requirements and limited cushion available in existing bank lines.

Liability management AMPL had a term loan of around Rs.400 million as on March 31, 2015 (Rs.351 million as on March 31, 2014) for which the debt obligations are about Rs.90 million. The company’s net cash accruals will be



sufficient to service its debt over the medium term. AMPL has not entered into any complex derivative contracts.

Financial Summary

31-Mar-14 31-Mar-13 31-Mar-12

Actual Actual Actual

Operating Income Rs.Million 5,247 2,218 1,956

OPBDIT Rs.Million 904 672 611

PAT Rs.Million 509 372 332

Net Cash Accruals Rs.Million 552 429 390

Cash Flow from Operations Rs.Million (396) 1388 16

Equity Share Capital Rs.Million 164 164 164

Tangible Net Worth Rs.Million 2,413 2010 1,713

Total Debt Rs.Million 608 463 594

OPBDIT Margins per cent 17.2 30.3 31.3

Net Profit Margins per cent 9.7 16.8 17.0

RoCE per cent 29.0 23.7 24.9

PBDIT/Int. & Finance Charges Times 8.12 9.64 7.90

Net Cash Accruals/Total Debt Times 0.91 0.93 0.66

Total Debt/Tangible Net Worth Times 0.25 0.23 0.35

Current Ratio Times 0.63 1.40 1.90

Twelve month data (abridged financials)

For the 12 months ended Unit Mar 2015 Mar 2014

Net Sales Rs.Million 6,335 5,247

OPBDIT Rs.Million 1,105 904

PAT Rs.Million 628 509

Net Cash Accruals Rs.Million 753 552

OPBDIT Margins % 17.4 17.2

Net Margins % 9.9 9.7

PBDIT/Int. & Finance Charges Times 11.1 8.1



Annexure – 1

S.No. Bank Facility Bank Amount

(Rs.in Million) Outstanding

Rating

1 Term Loan HDFC Bank Ltd. 387.5 CRISIL A+/Stable

2 Term Loan Axis Bank 72.5 CRISIL A+/Stable

3 Cash Credit* HDFC Bank Ltd. 500.0 CRISIL A+/Stable

4 Cash Credit State Bank of India 500.0 CRISIL A+/Stable

5 Cash Credit Canara Bank 100.0 CRISIL A+/Stable

6 Cash Credit ICICI Bank 50.0 CRISIL A+/Stable

7 Cash Credit Axis Bank 100.0 CRISIL A+/Stable

8 Bank Guarantee Canara Bank 1000.0 CRISIL A1

9 Bank Guarantee HDFC Bank Ltd. 200.0 CRISIL A1

10 Bank Guarantee# State Bank of India 2200.0 CRISIL A1

11 Bank Guarantee ICICI Bank 450.0 CRISIL A1

12 Bank Guarantee Axis Bank 400.0 CRISIL A1

Total 5960.0

* Sublimit of Rs.42.5 million for letter of credit # Sublimit of Rs.100.0 million for letter of credit

CRISIL Limited

CRISIL House, Central Avenue, Hiranandani Business Park, Powai, Mumbai 400076. Tel: + 91 (22) 3342 3000 – 09 Fax: + 91 (22) 3342 3001

CRISIL rating actions are updated online on www.crisil.com

Annexure 8

Annexure 9

Annexure 10