DRAFT PROSPECTUS

Dated February 26, 2016

Please read Section 32 of the Companies Act, 2013
100% Fixed Price Issue

SAGARDEEP ALLOYS LIMITED

Sagardeep Alloys Limited was incorporated as “Sagardeep Alloyes Private Limited” on February 13, 2007 under the Companies Act 1956 with a Certificate
of Incorporation issued by Registrar of Companies, Gujarat, Dadra and Nagar Haveli at Ahmedabad. Name of the Company was changed & modified to
Sagardeep Alloys Private Limited and fresh certificate of incorporation was issued by Registrar of Companies on June 25, 2009.  Thereafter once again a
fresh certificate of incorporation consequent upon change of name on conversion of the company to public limited company in the name of the “Sagardeep
Alloys Limited” was granted by ROC on April 17, 2012. Company Incorporation Number (CIN) of the Company is U29253GJ2007PLC050007.
Regd. Office: 205, Pittalaya Bumba, Nr. Madhuram Cinema, Gheekanta, Ahmedabad-380001.
Tel: +91-79-2562 6304, 2562 6535; Fax: +91-79-2562 6535; There is no change in the registered office address since incorporation.
E-mail: secretary@sdalloys.com; Website: www.sdalloys.com; Contact Person: Mr. Dileep Panchal, Company Secretary & Compliance Officer
PROMOTERS: MR. ASAMAL S MEHTA, MR. SATISHKUMAR A MEHTA, MR. JAYESHKUMAR A MEHTA AND MR. HARISH A MEHTA
PUBLIC ISSUE OF 30,00,000 EQUITY SHARES OF FACE VALUE OF RS. 10 EACH (“EQUITY SHARES”) OF SAGARDEEP ALLOYS LIMITED
(THE “COMPANY” OR THE “ISSUER”) FOR CASH AT A PRICE OF RS. 20 PER EQUITY SHARE (INCLUDING A SHARE PREMIUM OF RS.10
PER EQUITY SHARE) (THE “ISSUE PRICE”), AGGREGATING TO RS. 600.00 LACS (“THE ISSUE”), OF WHICH 1,55,000 EQUITY SHARES
OF FACE VALUE OF RS. 10 EACH FOR CASH AT A PRICE OF RS. 20 PER EQUITY SHARE, AGGREGATING TO RS. 31.00 LACS WILL BE
RESERVED FOR SUBSCRIPTION BY THE MARKET MAKER TO THE ISSUE (THE “MARKET MAKER RESERVATION PORTION”). THE ISSUE
LESS MARKET MAKER RESERVATION PORTION I.E. ISSUE OF 28,45,000 EQUITY SHARES OF FACE VALUE OF RS. 10 EACH FOR CASH
AT A PRICE OF RS. 20 PER EQUITY SHARE, AGGREGATING TO RS. 569.00 LACS IS HEREINAFTER REFERRED TO AS THE “NET ISSUE”.
THE ISSUE AND THE NET ISSUE WILL CONSTITUTE 26.38% AND 25.02% RESPECTIVELY OF THE FULLY DILUTED POST ISSUE PAID UP
EQUITY SHARE CAPITAL OF OUR COMPANY.
THE FACE VALUE OF THE EQUITY SHARES IS RS. 10 EACH AND THE ISSUE PRICE OF RS. 20 IS 2.0 TIMES OF THE FACE VALUE OF THE
EQUITY SHARES.
In terms of SEBI Circular No. CIR/CFD/POLICYCELL/11/2015, all potential investors shall participate in the Issue only through an Application
Supported by Blocked Amount (“ASBA”) process providing details about the bank account which will be blocked by the Self Certified Syndicate
Banks (“SCSBs”) for the same. For details in this regard, specific attention is invited to the chapter titled “Issue Procedure” beginning on page 202 of
this Draft Prospectus. A copy will be delivered for registration to the Registrar of companies as required under Section 26 of the Companies Act, 2013.
THE ISSUE IS BEING MADE IN ACCORDANCE WITH CHAPTER XB OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE OF
CAPITAL AND DISCLOSURE REQUIREMENTS) REGULATIONS, 2009, AS AMENDED FROM TIME TO TIME (“SEBI ICDR REGULATIONS”). For
further details please refer the section titled ‘Issue related Information’ beginning on page 195 of this Draft Prospectus.
RISKS IN RELATION TO FIRST ISSUE
This being the first issue of Equity shares of Sagardeep Alloys Limited, there has been no formal market for the Equity Shares of the Company. The
face value of the Equity Shares is Rs. 10 and issue price is 2 times of the face value. The Issue price (as determined and justified by the Company
in consultation with Lead Manager as stated in Chapter titled “Basis for Issue Price” on page 57 of this Draft Prospectus) should not be taken to be
indicative of the market price of the Equity Shares after the Equity Shares are listed. No assurance can be given regarding an active and/or sustained
trading in the Equity Shares of the Company or regarding the price at which the Equity Shares will be traded after listing.
GENERAL RISKS
Investments in equity and equity-related securities 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. Investors are advised to read the risk factors 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
Equity Shares offered in the issue have not been recommended or approved by the Securities and Exchange Board of India (“SEBI”), nor does SEBI
guarantee the accuracy or adequacy of this Draft Prospectus. Specific attention of the investors is invited to the section titled “Risk factors” on
page 9 of this Draft Prospectus.
ISSUER’S ABSOLUTE RESPONSIBILTY
The Company, having made all reasonable inquiries, accepts responsibility for and confirms that this Draft Prospectus contains all information with
regard to the Company and the Issue which is material in the context of the issue, that the information contained in this Draft Prospectus is true and
correct in all material aspects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestly held and
that there are no other facts, the omission of which makes this Draft Prospectus as a whole or any of such information or the expression of any such
opinions or intentions misleading in any material respect.
LISTING
The Equity shares offered through this Draft Prospectus are proposed to be listed on SME platform of the National Stock Exchange of India Limited
(“NSE”) (“NSE EMERGE”). In terms of the Chapter XB of the SEBI (ICDR) Regulations, 2009, as amended, we are not required to obtain an in-
principle listing approval for the shares being offered in the issue. However, our Company has received an in-principle approval letter dated [●] from
NSE for using its name in the offer document for listing of our shares on the NSE EMERGE. For the purpose of the Issue, the Designated Stock
Exchange will be the National Stock Exchange of India Limited
LEAD MANAGER TO THE ISSUE REGISTRAR TO THE ISSUE
Chartered Capital And Investment Limited Link Intime India Private Limited
711, Mahakant, Opp V.S. Hospital, Ellisbridge, C-13, Pannalal Silk Mills Compound,
Ahmedabad-380 006 L.B.S. Marg, Bhandup (West),  Mumbai 400 078
Tel: +91-79-2657 5337, 2657 7571 Fax: +91-79-2657 5731 Tel : +91-22- 61715400, Fax : +91-22- 25960329
E-mail: sal.ipo@charteredcapital.net E-mail: sal.ipo@linkintime.co.in
Investor Grievance Email: investor.relation@charteredcapital.net Investor Grievance Email: sal.ipo@linkintime.co.in
Website: www.charteredcapital.net Website: www.linkintime.co.in
Contact Person: Mr. Manoj Kumar Ramrakhyani/ Mr. Sagar Bhatt Contact person: Ms. Shanti Gopalkrishnan
SEBI Registration No.: INM000004018 SEBI Registration No.: INR000004058

ISSUE PROGRAMME
ISSUE OPENS ON : [●] ISSUE CLOSES ON : [●]
 Page
TABLE OF CONTENTS
No.
SECTION I – DEFINITIONS AND ABBREVIATIONS....................................................................... 2
Issue Related Terms ……………………………….…………………………………………………..…… 2
Company Related Terms …………………………………………………………………………………… 4
Technical/Industry Related Terms…………………………………………………………………………. 5
Conventional/ General Terms………….…………………………………………………………………… 5
Abbreviations…………………………………………………………………………………………………. 6
SECTION II - RISK FACTORS…………………………………………………………………………….. 7
Certain Conventions - Use of Market Data…………………………………………………… ………….. 7
Forward Looking Statements………………………………………………………………………………. 8
Risk Factors………………………………………………………………………………………………….. 9
SECTION III – INTRODUCTION…………………………………………………………………………… 23
Summary………………………………………………………………………………………..................... 23
Summary Financial Information…………………………………………………………………………….. 27
The Issue……………………………………………………………………………………………………… 36
General Information………………………………………………………………………………………….. 37
Capital Structure……………………………………………………………………………………………… 43
Objects of the Issue………………………………………………………………………………………….. 52
Basis For Issue Price…………………………………………………………………………………………. 57
Statement of Tax Benefits…………………………………………………………………………………… 59
SECTION IV – ABOUT THE ISSUER COMPANY………………………………………………………. 66
Industry Overview……………………………………………………………………………………………. 66
Business Overview ………………………………………………………………………………………….. 76
Regulations and Policies……………………………………………………………………………………. 85
History and Certain Corporate Matters …………………………………………………………………… 89
Our Management……………………………………………………………………………………………. 92
Our Promoters And Promoter Group……………………………………………………………………… 104
Related Party Transactions………………………………………………………………………………… 110
Currency of Presentation……………………………………………………………………………………. 111
Dividend Policy………………………………………………………………………………………………. 112
SECTION V – FINANCIAL INFORMATION……………………………………………………………… 113
Financial Information of the Company…………………………………………………………………….. 113
Changes In Accounting Policies In Last Three Years ………………………………………… 170
Management’s Discussion And Analysis Of Financial Condition And Results Of Operations …….… 171
SECTION VI – LEGAL AND OTHER INFORMATION………………………………………………….. 177
Outstanding Litigations and Material Developments…………………………………………………….. 177
Government Approvals / Licensing Arrangements………………………………………………………. 184
SECTION VII – OTHER REGULATORY AND STATUTORY DISCLOSURES……………………… 187
SECTION VIII – ISSUE RELATED INFORMATION……………………………………………………. 195
Terms of the Issue………………………………………………………………………………………….. 195
Issue Structure………………………………………………………………………………………………. 200
Issue Procedure…………………………………………………………………………………………….. 202
SECTION IX – MAIN PROVISIONS OF THE ARTICLES OF ASSOCIATION……………………….. 250
SECTION X – OTHER INFORMATION………………………………………………………………….. 285
Material Contracts And Documents For Inspection……………………………………………………….. 285
Declaration………………………………………………………………………………........................... 287
Annexure - A…………………………………………………………………………………………………. 288

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 SECTION I- DEFINITIONS AND ABBREVIATIONS
This Draft Prospectus uses certain definitions and abbreviations which, unless the context otherwise
indicates or implies, shall have the meaning as provided below. References to any Act, legislation or
regulation shall be to such legislation, act or regulation as amended from time to time.

In the Draft Prospectus, unless otherwise indicated or the context otherwise requires, all references to
“Sagardeep Alloys Limited”, “SAL”, the/our “Company”, “we”, “our”, “us” or similar terms are to
Sagardeep Alloys Limited or, as the context requires, and references to “you” are to the equity
shareholders and/ or prospective investors in the Equity Shares.

ISSUE RELATED TERMS

Term Description
Allotment/ Allot/ Allotted Unless the context otherwise requires, the issue/allotment of Equity Shares
pursuant to the Issue to successful applicants.
Allotment Advice Note or advice or intimation of Allotment sent to the Applicants who have
been allotted Equity Shares after the Basis of Allotment has been approved
by the designated Stock Exchange.
Allottee The successful applicants to whom the Equity Shares are allotted
Applicant Any prospective investor who makes an application pursuant to the terms of
this Draft Prospectus and the Application Form.
Application amount The number of Equity Shares applied for and as indicated in the Application
Form multiplied by the price per Equity Share payable by the Applicants on
submission of the Application Form.
Application Form The form in terms of which the Applicant shall make an application to
subscribe to the Equity Shares of our Company.
Application Supported by An application, whether physical or electronic, used by all Applicants to
Blocked Amount / ASBA make application authorizing a SCSB to block the application amount in the
ASBA Account maintained with such SCSB.
ASBA Account Account maintained with SCSBs which will be blocked by such SCSBs to the
extent of the Application Amount
Banker(s) to the Issue The banks which are clearing members and registered with SEBI as Banker
to the Issue with whom the Public Issue Account will be opened and in this
case being Indusind Bank Ltd
Basis of Allotment The basis on which the Equity Shares will be allotted as described in the
section titled "Issue Procedure - Basis of Allotment" beginning on page
214 of this Draft Prospectus.
Controlling Branch of SCSB Such branches of the SCSBs which co-ordinate Applications under this
Issue made by the Applicants with the Lead Manager, the Registrar to the
Issue and the Stock Exchanges, a list of which is provided on
http://www.sebi.gov.in
Demographic Details The demographic details of the Applicants such as their Address, PAN,
Occupation and Bank Account details.
Depository Participant A Depository Participant as defined under the Depositories Act, 1996
Designated Branches Such branches of the SCSBs which shall collect the ASBA Application Form
from the ASBA Applicant and a list of which is available on
http://www.sebi.gov.in
Designated Date The date on which funds are transferred from the ASBA Accounts to the
Public Issue Account in terms of the Draft Prospectus.
Designated Stock Exchange NSE Emerge
Draft Prospectus This Draft Prospectus dated February 26, 2016 issued in accordance with
Section 32 of the Companies Act, 2013 and filed with NSE under SEBI ICDR
Regulations
Eligible NRI NRIs from such jurisdiction outside India where it is not unlawful to make an
offer or invitation under the Issue and in relation to whom this Draft
Prospectus constitutes an invitation to subscribe for the Equity Shares on the
basis of the terms thereof.
Issue/ Issue Size/ Offer/ Public Issue of 30,00,000 Equity Shares of face value Rs. 10 each of

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Initial Public Offer/ Initial Sagardeep Alloys Limited for cash at a price of Rs. 20 per Equity Share (the
Public Offering/ IPO "Issue Price") aggregating up to Rs. 600.00 Lacs.
First/ Sole Applicant The Applicant whose name appears first in the Application Form or Revision
Form
Issue Closing Date [●]
Issue Opening Date [●]
Issue Period The period between the Issue Opening Date and the Issue Closing Date
inclusive of both days and during which prospective Applicants can submit
their Applications.
Issue Price The price at which Equity Shares will be issued and allotted by our Company
being Rs. 20/- per Equity Share.
Issue Proceeds Proceeds to be raised by our Company through this Issue, for further details
please refer chapter title “Objects of the Issue” page no. 52 of this Draft
Prospectus.
LM / Lead Manager The Lead Manager for the issue being Chartered Capital And Investment Ltd
Market Maker Market Maker appointed by our Company from time to time, in this case
being Innovate Securities Private Limited who has agreed to receive or
deliver the specified securities in the market making process for a period of
three years from the date of listing of our Equity Shares or for any other
period as may be notified by SEBI from time to time
Market Making Agreement Market Making Agreement dated [●] between our Company, LM and Market
Maker
Market Maker Reservation The reserved portion of 1,55,000 Equity Shares of Rs. 10 each at an Issue
Portion Price of Rs. 20 each to be subscribed by Market Maker.
MOU/ Issue Agreement The Memorandum of Understanding dated January 27, 2016 between our
Company and Lead Manager.
Mutual Fund(s) Mutual fund(s) registered with SEBI pursuant to the SEBI (Mutual Funds)
Regulations, 1996, as amended.
Net Issue The Issue (excluding the Market Maker Reservation Portion) of 28,45,000
Equity Shares of face value Rs. 10 each of Sagardeep Alloys Limited for
cash at a price of Rs. 20 per Equity Share aggregating up to Rs. 569.00
Lacs.
Non Institutional Investors All Applicants that are not Qualified Institutional Buyers or Retail Individual
Investors and who have Applied for Equity Shares for an amount more than
Rs. 2,00,000
NSE EMERGE The SME platform of NSE, approved by SEBI as an SME Exchange for
listing of equity shares offered under Chapter X-B of the SEBI ICDR
Regulations.
Other Investors Investors other than Retail Individual Investors. These include individual
applicants other than retail individual investors and other investors including
corporate bodies or institutions irrespective of the number of specified
securities applied for.
Prospectus The Prospectus, to be filed with the RoC in accordance with the provisions of
Section 32 of the Companies Act, 2013.
Public Issue Account The Bank Account opened with the Banker to this Issue to receive monies
from the SCSBs from the bank accounts of the ASBA Applicants on the
Designated Date.
Qualified Institutional Buyers A mutual fund, venture capital fund alternative investment fund and foreign
or QIBs venture capital investor registered with the Board; a foreign portfolio investor
other than Category III foreign portfolio investor registered with the Board; a
public financial institution as defined in Section 4A of the Companies Act,
1956; a scheduled commercial bank; a multilateral and bilateral development
financial institution; a state industrial development corporation; an insurance
company registered with the Insurance Regulatory and Development
Authority; a provident fund with minimum corpus of twenty five crore rupees;
a pension fund with minimum corpus of twenty five crore rupees; National
Investment Fund set up by resolution F. No. 2/3/2005 - DDII dated
November 23, 2005 of the Government of India published in the Gazette of
India; insurance funds set up and managed by army, navy or air force of the

3
 Union of India and insurance funds set up and managed by the Department
of Posts, India.
Regulations/ SEBI SEBI (Issue of Capital and Disclosure Requirement) Regulations, 2009 as
Regulations/ SEBI (ICDR) amended from time to time
Regulations
Registrar/ Registrar Link Intime India Private Limited
to this Issue/RTI
Retail Individual Individual applicants who have applied for the Equity Shares for an amount
Investors/RIIs not more than 200,000 (including HUFs applying through their Karta and
Eligible NRIs and does not include NRIs other than Eligible NRIs)
SEBI Listing Regulations Securities and Exchange Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015 and includes the agreement to be entered
into between our Company and the Stock Exchange in relation to listing of
Equity Shares on such Stock Exchange.
Self Certified Syndicate A Bank which is registered with SEBI under SEBI (Bankers to an Issue)
Bank or SCSB Regulations, 1994 and offers services of ASBA including blocking of bank
account, a list of which is available on http://www.sebi.gov.in/pmd/scsb.pdf
Underwriters [●]
Underwriting Agreement The Agreement dated [●] entered into amongst the Underwriters and our
Company.
Working Days "Working Day" means all days, other than second and fourth Saturday of the
month, Sunday or a public holiday, on which commercial banks in Mumbai
are open for business; provided however, with reference to (a)
announcement of Price Band; and (b) Bid/Offer Period, “Working Day” shall
mean all days, excluding all Saturdays, Sundays or a public holiday, on
which commercial banks in Mumbai are open for business; and with
reference to the time period between the Bid/Offer Closing Date and the
listing of the Equity Shares on the Stock Exchanges, “Working Day” shall
mean all trading days of Stock Exchanges, excluding Sundays and bank
holidays.

COMPANY RELATED TERMS

Term Description
Articles/ Articles of The Articles of Association of our company.
Association
Auditors The statutory auditors of the Company, being M/s Piyush J Shah & Co.,
Chartered Accountants.
Board The Board of Directors of our company or a duly constituted committee
thereof.
Group Companies Companies, firms and ventures promoted by our Promoter, irrespective of
whether such entities are covered under Section 370(1)(B) of the Companies
Act or not and disclosed in the section “Promoter and Promoter Group” on
page 104
Memorandum/ Memorandum of Association of our Company, as amended
Memorandum of Association
Promoters Mr. Asamal S Mehta, Mr. Satishkumar A Mehta, Mr. Jayeshkumar A Mehta
And Mr. Harish A Mehta
Promoter Group The persons and entities constituting our Promoter group in terms of
Regulation 2(zb) of the SEBI Regulations and disclosed in the section “Our
Promoters and Promoter Group” on page 104
Registered Office/ The Registered Office of the Company at 205, Pittalaya Bumba, Nr.
Registered office of the Madhuram Cinema, Gheekanta, Ahmedabad-380001
Company
ROC Registrar of Companies, Gujarat, Dadra and Nagar Haveli
Subsidiary Sagardeep Engineers Pvt Ltd

4
TECHNICAL/INDUSTRY RELATED TERMS

Term Description
FDI Foreign Direct Investment
ESIC Employee’s State Insurance Corporation
ICAI The Institute of Chartered Accountants of India
GDP Gross Domestic Product

CONVENTIONAL/GENERAL TERMS

Term Description
AS Accounting Standards as issued by the Institute of Chartered Accountants of
India.
Companies Act Companies Act, 1956 and Companies Act, 2013, as applicable
Companies Act, 1956 Companies Act, 1956 (without reference to the provisions thereof that have
ceased to have effect upon notification of the sections of the Companies Act,
2013) along with the relevant rules made thereunder
Companies Act, 2013 Companies Act, 2013, to the extent in force pursuant to the notification of
sections of the Companies Act, 2013, along with the relevant rules made
thereunder
Depository A body corporate registered under the SEBI (Depositories and Participants)
Regulations, 1996, as amended from time to time.
Depositories Act Depositories Act, 1996, as amended from time to time
Depository Participant A depository participant as defined under the Depositories Act, 1996
FCNR Account Foreign Currency Non Resident Account.
FEMA Foreign Exchange Management Act, 1999, as amended from time to time, and
the rules and regulations framed thereunder.
Financial Year /fiscal Period of twelve months ended March 31 of that particular year, unless
year/FY/ fiscal otherwise stated.
Government/ GOI The Government of India.
GAAP Generally Accepted Accounting Principles
HUF Hindu Undivided Family.
Mn, mn Million
NAV Net asset value.
NR Non-Resident
NRE Account Non-Resident External Account.
NRO Account Non-Resident Ordinary Account.
NRI/Non-Resident Indian A person resident outside India, who is a citizen of India or a person of Indian
origin, and shall have the meaning ascribed to such term in the Foreign
Exchange Management (Deposit) Regulations, 2000
NSE The National Stock Exchange of India Ltd
OCB/ Overseas Corporate A company, partnership, society or other corporate body owned directly or
Body indirectly to the extent of at least 60% by NRIs including overseas trusts, in
which not less than 60% of beneficial interest is irrevocably held by NRIs
directly or indirectly and which was in existence on October 3, 2003 and
immediately before such date had taken benefits under the general permission
granted to OCBs under FEMA.
P/E Ratio Price/Earnings Ratio.
PAT Profit After Tax
PBT Profit Before Tax
RONW Return on Networth
SCRA Securities Contracts (Regulation) Act, 1956
SCRR Securities Contracts (Regulation) Rules, 1957
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 Securities and Exchange Board of India (Issue of Capital and Disclosure

5
 Requirements) Regulations, 2009, as amended from time to time.
SEBI Takeover Regulations Securities and Exchange Board of India (Substantial Acquisition of Shares and
Takeovers) Regulations, 2011, as amended from time to time.

ABBREVIATIONS

AGM Annual General Meeting.

ASBA Application Supported by Blocked Amount
A.Y Assessment Year
A/C Account
BG/LC Bank Guarantee/ Letter of Credit
BV / NAV Book value / Net asset value
CAGR Compounded Annual Growth Rate.
CDSL Central Depository Services (India) Ltd.
DP Depository Participant.
EGM Extraordinary General Meeting
EPS Earnings Per Share.
ESOP Employees Stock Option Plan
FDI Foreign Direct Investment
FIPB Foreign Investment Promotion Board.
FIBC Flexible Intermediate Bulk Container
FVCI Foreign Venture Capital Investor
FIIs Foreign Institutional Investors
GOI Government of India.
I.T.Act Income-Tax Act, 1961
MAT Minimum Alternate Tax
NRI(s) Non-Resident Indian (s)
NSDL National Securities Depository Limited
NSE The National Stock Exchange of India Ltd
N.A. Not Applicable
P/E Ratio Price/Earnings Ratio
PAN Permanent Account Number
QC Quality Control
QIB Qualified Institutional Buyer
RBI Reserve Bank of India.
SCSB Self Certified Syndicate Bank
UK United Kingdom
U.S./U.S.A. United States of America

The words and expressions used but not defined herein shall have the same meaning as is assigned
to such terms under the SEBI Regulations, the Companies Act, the SCRA, the Depositories Act and
the rules and regulations made thereunder.

6
 SECTION II – RISK FACTORS

CERTAIN CONVENTIONS - USE OF MARKET DATA

Unless stated otherwise, the financial data in this Draft Prospectus is derived from our financial
statements prepared in accordance with Indian GAAP, Companies Act and the SEBI Regulations
included elsewhere in this Draft Prospectus. Our fiscal year commences on April 1 every year and
closes on March 31 of the next year. In this Draft Prospectus, any discrepancies in any table between
the total and the sums of the amounts listed are due to rounding-off.

In this Draft Prospectus, unless the context otherwise requires, all references to one gender also
refers to another gender and the word “lacs” means “one hundred thousand” and the word “million”
means “ten lac” and the word “Crore” means “ten million”. Throughout this Draft Prospectus, all
figures have been expressed in lacs. Unless otherwise stated, all references to “India” contained in
this Draft Prospectus are to the Republic of India.

Industry data used throughout this Draft Prospectus has been obtained from industry publications and
other authenticated published data. Industry publications generally state that the information
contained in those publications has been obtained from sources believed to be reliable but that their
accuracy and completeness are not guaranteed and their reliability cannot be assured. Although the
Company believes that industry data used in this Draft Prospectus is reliable, it has not been
independently verified. Similarly, internal Company reports, while believed by us to be reliable, have
not been verified by any independent sources

For additional definitions, please refer to the section titled ‘Definitions and Abbreviations’ on
page no. 2 of this Draft Prospectus. In the section titled ‘Main Provisions of the Articles of
Association’ on page no. 250 of this Draft Prospectus, defined terms have the meaning given
to such terms in the Articles of Association of the Company.

7
 FORWARD LOOKING STATEMENTS
We have included statements in this Draft Prospectus, that contain words or phrases such as “will”,
“aim”, “will likely result”, “believe”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”,
“contemplate”, “seek to”, “future”, “objective”, “goal”, “project”, “should”, “will pursue” and similar
expressions or variations of such expressions that are “forward-looking statements”. However, these
words are not the exclusive means of identifying forward-looking statements. All statements regarding
our expected financial condition and results of operations, business, plans and prospects are forward
looking statements. These forward looking statements include statements as to our business strategy,
planned projects and other matters discussed in this Draft Prospectus regarding matters that are not
historical fact. These forward-looking statements and any other projections contained in this Draft
Prospectus (whether made by us or any third party) involve known and unknown risks, uncertainties
and other factors that may cause our actual results, performance or achievements expressed or
implied by such forward-looking statements or other projections.

All forward looking statements are subject to risks, uncertainties and assumptions about the company
that could cause actual results to differ materially from those contemplated by the relevant forward-
looking statement. Important factors that could cause actual results to differ materially from the
expectations include, among others:

• Our ability to retain and attract trained employees;

• Changes in the value of the Rupee and other currency changes;
• Loss or decline in the business from any of our key clients;
• General economic and business conditions in India and other countries;
• Our ability to successfully implement the strategy, growth, new projects and expansion plans;
• Changes in the Indian and international interest rates;
• Social or civil unrest or hostilities with neighboring countries or acts of international terrorism;
• Changes in laws and regulations that apply to our industry, including laws that impact our
ability to enforce our collateral.
• Changes in political conditions in India.

For further discussion of factors that could cause actual results to differ, please refer the section
entitled “Risk Factors” beginning on page 9 of this Draft Prospectus. By their nature, certain market
risk disclosures are only estimates and could be materially different from what actually occurs in the
future. As a result, actual future gains or losses could materially differ from those that have been
estimated. Neither the Company, the Directors, any member of the Lead Manager team nor any of
their respective affiliates have any obligation to update or otherwise revise any statements reflecting
circumstances arising after the date hereof or to reflect the occurrence of underlying events, even if
the underlying assumptions do not come to fruition. In accordance with SEBI requirements, the
Company and the Lead Manager will ensure that investors in India are informed of material
developments until such time as the grant of listing and trading permission by the Stock Exchange.

8
 RISK FACTORS
An investment in the Equity Shares involves a high degree of risk. You should carefully consider all
the information in this Draft Prospectus, including the risks and uncertainties described below, before
making an investment in our Equity Shares. The risks described below are not the only risks relevant
to us, our Equity Shares, the industry in which we operate or India and the other regions in which we
operate. To obtain a more complete understanding of our Company, prospective investors should
read this section in conjunction with the sections entitled “Business Overview” and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations,” on pages 76 and 171,
respectively, as well as the financial and other information contained in this Draft Prospectus.

If any of the following risks, or other risks that are not currently known or are now deemed immaterial,
actually occur, our business, results of operations and financial condition could suffer, the trading
price of our Equity Shares could decline, and all or part of your investment may be lost. Unless
otherwise stated, we are not in a position to specify or quantify the financial or other risks mentioned
herein. You should consult your tax, financial and legal advisors about the particular consequences to
you of an investment in our Equity Shares.

This Draft Prospectus contains forward-looking statements that involve risks and uncertainties. Our
actual results could differ materially from those anticipated in these forward-looking statements as a
result of certain factors, including the considerations described below and elsewhere in this Draft
Prospectus. See the section entitled “Forward Looking Statements” on page 8.

Unless otherwise stated or the context otherwise requires, the financial information used in this
section is derived from the restated consolidated/standalone financial statements of our Company.

Materiality

The Risk factors have been determined on the basis of their materiality. The following factors have
been considered for determining the materiality:

a) Some events may not be material individually but may be found material collectively.
b) Some events may have material impact qualitatively instead of quantitatively.
c) Some events may not be material at present but may be having material impacts in future.

A. SPECIFIC TO THE OBJECT OF THE ISSUE AND INTERNAL TO THE COMPANY

1) There are outstanding litigations involving our Company, our promoters, our directors and
our group companies.

Our Company, our Promoters, our Directors and our Group Companies are involved in certain
legal proceedings which are pending at different levels of adjudication before various courts,
tribunals and appellate authorities. We cannot provide assurance that these legal proceedings will
be decided in our favour. Decisions in such proceedings adverse to such person/ entity’s interests
may have a significant adverse effect on our business, results of operations, cash flows and
financial condition.

A summary of the outstanding litigations is as follows:

Particulars Total No Amount involved (Rs

in lacs)
Under Criminal Laws
Cases filed by the Promoters/Directors/Group 3 26.73
Companies/Group concerns
Under Tax laws
Cases filed by the Company 3 689.14
Under Civil Laws
Cases filed against the Company 1* 8.23+interest
Cases filed against the Promoters/Directors/Group 1* 8.23+interest
Companies/ Group concerns

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 Others
Notices Received by the company 3 0.60
*Same matter
For further details, please refer to section “Outstanding Litigations and Material Developments” on
page no.177 of Draft Prospectus.

2) We are required to obtain and maintain certain governmental and regulatory licenses and
permits and the failure to obtain and maintain such licenses and permits in a timely
manner, or at all, may adversely affect our business and operations.

We are required to obtain and maintain certain approvals, licenses, registrations and permits in
connection with its business and operations. There can be no assurance that we will be able to
obtain and maintain such approvals, licenses, registrations and permits in the future. An inability
to obtain or maintain such registrations and licenses in a timely manner, or at all, and comply with
the prescribed conditions in connection therewith may adversely affect our ability to carry on our
business and operations, and consequently our results of operations and financial condition.

Approval applied for but not received

• Factory license bearing registration no. 18/27201/2008 and License no. 209 was issued in the
name of Sagardeep Alloyes Private Limited. The same has been expired in December 31,
2014. The company has applied for the renewal but has not received the license as on date.

• Application dated May 8, 2015 under Class 6 in respect of Common Metals and their alloys,
pipe and tubes metal, copper pipes, tubes, flats, roads, nuggets, plates and copper alloys
consumables included submitted to the Office of the Trademark Registrar for registration of

Company’s Trademark “ ” under Trade Marks Act, 1999.

Approval not yet applied

• Registration Certificate of Establishment bearing registration number PII/SHA2/05/0000044

dated May 16, 2008 issued by the Ahmedabad Municipal Corporation registering our
Company as a commercial establishment under the Bombay Shops and Establishments Act,
1948. The said registration was valid till March 31, 2009. The company has not applied for its
renewal.

There are certain approvals which are still in old name. For further details, please refer to section
“Government Approvals/Licensing Arrangements” on page no.184 of Draft Prospectus.

3) Our business is substantially dependent on limited number of customers for a significant

portion of our revenues. The loss of any significant clients or an adverse change in the
customer relationship may have a material and adverse effect on our business and results
of operations.

The Company is largely dependent on single and few customers, as the top one and top ten
customers constitutes around 17.95% and 76.65% of the total income for the year 2014-15 on a
standalone and consolidated basis. While we are constantly working to increase our customer
base so as to enable us to reduce dependence limited number of customers, there is no
assurance that we will be able to broaden our customer base in a particular time frame in future.
Our business or results of operations could be adversely affected by a reduction in demand or
change in preference for our product or cessation of our relationship with any such major
customers.

4) The total revenue of the company is decreasing year on year since fiscal year 2013 and in
spite of all its efforts, the company is unable to change the trend.

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 The metal sector is facing severe economic slowdown due to multiple factors most of which are
not within the control of management and same is affecting the scale of operations and
performance of the company due to which the profitability of the company has becomes almost
stagnant during last 3 years. However, the manufacturing activity of the company is doing
relatively better and company expects that it will help in maintaining and improving the future
profitability in the future.

5) The Company has unsecured debt that is repayable on demand.

The Company has availed of certain unsecured loans that are repayable on demand. As on
September 30, 2015, the amount of outstanding unsecured loans availed by the company which
are repayable on demand is Rs. 487.50 Lacs. The unsecured loan taken by the Company is not
from any Bank or Financial Institution. In the event that the lenders of such loans demands the
repayment of these loans, the company would need to find alternative sources of financing, which
may not be available on commercially reasonable terms or at all.

6) Investment made in Subsidiary Company as well as in the Chemical business has not
worked out well as envisaged by the company.

Company invested almost Rs.3 crores in plant and machineries for the manufacturing unit of
chemical products which it had acquired on rent during 2014-15. However, the said venture could
not succeed and company had to shut down its operations in June 2015. In addition, the seller of
the unit has forcefully taken the possession of the property as well as our machineries and stock
(approximately worth Rs.9 lacs) lying in that premises. Mr. Jayeshkumar A Mehta, Director of the
Company lodged a Police complaint in the Khambhat Police Station against Mr. Ritesh Kumar
Patel along with few other person regarding the same. At present the matter is in dispute and
company is in process to solve the matter amicably. Though the company is trying to resolve the
issue through negotiations, if company is unable to get the possession of the said machineries
and stock, it will have to write off the entire amount which will affect the profitability and financial
position of the company to that extent which is substantial looking to the existing size of the
company.

In addition, Company invested Rs.5 lacs in acquiring subsidiary company Sagardeep Engineers
Private Limited (“SEPL”) from its existing promoters and thereafter Rs.511.20 lacs for subscribing
the share capital of this subsidiary company with no benefit accruing or expected to accrue to the
company. There is neither any sizeable business in the subsidiary company nor any potential
business prospect in the company which can commercially justify the amount of investment in
SEPL.

7) Our Subsidiary has incurred loss in financial year 2014-15.

Our Subsidiary has incurred loss of Rs. 0.03 Lacs in financial year 2014-15. Sustained financial
losses by our Subsidiary may not be perceived positively by external parties such as customers,
bankers, suppliers etc, which may affect our credibility and business operations. There can be no
assurance that our Subsidiary or any other ventures promoted by our Promoters, will not incur
losses in any future periods, or that there will not be an adverse effect on our reputation or
business as a result of such losses.

8) Other ventures promoted by our promoters are engaged in a similar line of business and
conflict of interest cannot be ruled out which may have adverse effect on our operations
and financial conditions.

Subsidiary Company, Sagardeep Engineering Pvt Ltd, and Proprietorship concern, Sagar Prakash
Alloys are involved in the similar activities which is also one of the activities carried on by the issuer
company.

This could lead to a potential conflict of interest for us and could adversely affect our results of
operations and financial condition. There is no assurance that in case of conflict, our Promoters will
not favour our group Companies owing to their common interest in both the Companies. In
addition, attention to the other Group entities may distract or dilute management attention from our

11
 business, which could adversely affect our results of operations and financial condition. For further
information, see the section entitled “Our Promoters and Promoter Group” on page 104 of this Draft
Prospectus.

9) Our management will have flexibility in applying the Proceeds of the Issue and the
deployment of the Proceeds is not subject to any monitoring by any independent agency.
The purposes for which the Proceeds of the Issue are to be utilized are based on
management estimates and have not been appraised by any banks or financial institutions.

We intend to use the Proceeds of the Issue for the purposes described in “Objects of the Issue”
on page 52. Our management may revise estimated costs, fund requirements and deployment
schedule owing to factors relating to our business and operations and external factors which may
not be within the control of our management.

The utilization of the Proceeds of the Issue and other financings will be monitored only by the
Audit Committee of the Board and is not subject to any monitoring by any independent agency.
Further, pending utilization of the Proceeds of the Issue, we intend to deposit the Net Proceeds
only in scheduled commercial banks included in the Second Schedule of the Reserve Bank of
India Act, 1934.

Our funding requirements and the deployment of the Proceeds of the Issue are based on
management estimates and have not been appraised by any banks or financial institutions. In
view of the highly competitive nature of the industry in which we operate, we may have to revise
our management estimates from time to time and, consequently, our funding requirements may
also change.

10) We have experienced negative cash flows in prior periods. Any operating losses or
negative cash flows in the future could adversely affect our results of operations and
financial condition.

The details of the negative cash flows of the Company are as follows:

Standalone (Rs. in Lacs)

Particulars As at
30.09.15 31.03.15 31.03.14 31.03.13 31.03.12 31.03.11
Net Cash From /(Used 388.89 392.66 790.25 171.00 (815.82) (520.95)
In ) Operating Activities
Net Cash From /(Used (508.48) (344.26) (31.34) (38.28) 23.12 (58.58)
In ) Investing Activities
Net Cash From 136.79 (76.97) (750.29) (116.16) 802.52 583.74
Financing Activities (c)
Net Increase / 17.20 (28.57) 8.62 16.56 9.82 4.21
(Decrease) in Cash

Consolidated (Rs. in Lacs)

As at
Particulars 30.09.15 31.03.15 31.03.11
Net Cash From /(Used In ) Operating Activities (77.26) 852.82 (520.95)
Net Cash From /(Used In ) Investing Activities (4.01) (614.75) (58.58)
Net Cash From Financing Activities (c) 98.87 (267.20) 583.74
Net Increase / (Decrease) in Cash 17.61 (29.13) 4.21

11) There have been instances of delay in compliances, filing of various forms, as well as non-
compliances under various provisions of applicable Companies Act for which penal action
can be taken against the company and its officers which would adversely affect financial
position of the Company to that extent.

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 Some of the instances of non compliances/delay in compliances of the provisions of the
companies act are as under for which penal action can be taken against the company and its
officers which would adversely affect financial position of the Company to that extent:

The Company has not complied with the provisions of Section 383A of the Companies Act, 1956
during the period March 22, 2012 to March 31, 2014 and the provisions of Section 203 of the
Companies Act, 2013 during the period April 1, 2014 to March 31, 2015 as the Company had not
appointed any Company Secretary during the said period. No show cause notice in respect of the
above has been received by the Company from the office of Registrar of the Companies till date.

The company had passed a special resolution under section 149 and other applicable provisions
of Companies Act, 1956 in its Extra Ordinary General Meeting held on March 6, 2014 relating to
commencement of chemical business i.e. an object mentioned in the “other Object” clause of the
Memorandum of Association of the Company. As per Section 117 of companies act, 2013, E-
form is required to be filed within the stipulated period of passing the resolution but the company
could not file E-form MGT-14 in prescribed time. Therefore, the Company filed an application to
Central Government under section 460 of Companies Act, 2013 for condonation of delay in filing
Form MGT-14 due to non filing of Special Resolution within stipulated time period. The said
application has been made by the Company to Central Government by way of e-form i.e. Form
NO. CG-1 on December 22, 2015 which is still pending. In addition, the company has also not
filed a declaration in prescribed form as required under section 149(2A) with the RoC.

Company has given loan to its wholly owned subsidiary Sagardeep Engineers Private Limited
which as on March 31, 2015 and September 30, 2015 stands at Rs.510.20 lacs and Rs.20.65 lacs
respectively. The said loans given to subsidiary were “interest free loan” which prima facie is in
non compliance of section 186 of the Companies Act, 2013.

12) Our Company has not filed certain Annual Returns appropriately in the past with respect to
shareholding records.

Our Company has not filed certain Annual Returns for the financial year 2008-09, 2009-10, 2010-
11 and 2011-12 appropriately with respect to shareholding records. Though our Company has
appropriately maintained our Register of Members, Transfer Deeds and issued share certificates
appropriately, inappropriate disclosures, as aforesaid, may in the future render us liable to
statutory penalties.

13) Our indebtedness and the conditions and restrictions imposed by our financing and other
agreements could adversely affect our ability to conduct our business and operations.

We have incurred a substantial amount of indebtedness which could adversely affect our financial
condition. As on September 30, 2015, our short term and long term borrowings are Rs. 1900.14
Lacs on a standalone and consolidated basis. In addition, we may incur substantial additional
indebtedness in the future. Our indebtedness could have several significant consequences
including but not limited to the reduction of the availability of our cash flow to fund working capital,
capital expenditures and other general corporate requirements. Also fluctuations in market
interest rates may affect the cost of our borrowings.

Apart from that as per the terms of the sanction letter of the bank, the company can not do the
certain activities, during the Currency of the bank’s credit facilities, without the bank’s prior
permission in writing of the Banks, which amongst other, includes:

a) Implement any scheme of Expansion/ Modernization/ Diversification, except which are

approved by our Bank
b) Formulate any scheme of Merger/ Acquisition/ Amalgamation / Reconstitution
c) Any Change in the management set–up /capital structure of the Company;
d) Enter into borrowing either secured or unsecured with any other Bank/ Financial
Institution/ corporate body;
e) Invest/ deposit/ lend funds to the group firms & companies / directors / family members /
other corporate bodies / firms / persons;

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