Pant A Loon

Serial no.
Not for Circulation
PANTALOON RETAIL (INDIA) LIMITED

(Incorporated in the Republic of India with limited liability under the Companies Act, 1956)
Pantaloon Retail (India) Limited (the “Company”) is issuing 6,265,060 Equity Shares of Rs. 2 each at a price of Rs. 415 per Equity
Share, including a premium of Rs.413 per Equity Share, aggregating Rs. 2,599.99 million. The Company has split one Equity Share of
Rs. 10 face value into five Equity Shares of Rs. 2 each pursuant to an AGM resolution dated November 17, 2006.
ISSUE IN RELIANCE UPON CHAPTER XIII-A OF THE SEBI GUIDELINES
THIS OFFERING AND THE DISTRIBUTION OF THIS PLACEMENT DOCUMENT IS BEING DONE IN RELIANCE
UPON CHAPTER XIII-A OF THE SEBI (DISCLOSURE AND INVESTOR PROTECTION) GUIDELINES, 2000, AS
AMENDED (THE “SEBI GUIDELINES”). THIS PLACEMENT DOCUMENT IS PERSONAL TO EACH PROSPECTIVE
INVESTOR, AND DOES NOT CONSTITUTE AN OFFER OR INVITATION TO SUBSCRIBE FOR EQUITY SHARES OR
SOLICITATION OF AN OFFER TO THE PUBLIC OR TO ANY OTHER PERSON OR CLASS OF INVESTORS.
Invitations, offers and sales of Equity Shares shall only be made pursuant to the Placement Document, Placement Document and
Confirmation of Allocation Note. See “Issue Procedure.” The distribution of this Placement Document or the disclosure of its contents
without our prior consent to any person, other than Qualified Institutional Buyers (as defined in the SEBI Guidelines) and persons
retained by Qualified Institutional Buyers to advise them with respect to their purchase of Equity Shares, is unauthorized and
prohibited. Each prospective investor, by accepting delivery of this Placement Document agrees to observe the foregoing restrictions,
and to make no copies of this Placement Document or any documents referred to in this Placement Document.
This Placement Document has not been and will not be registered as a prospectus with the Registrar of Companies in India, and will
not be circulated or distributed to the public in India.
Investments in equity and equity-related securities involve a degree of risk and prospective investors should not invest any
funds in this Issue unless they are prepared to take the risk of losing all or part of their investment. Investors are advised to
read the risk factors carefully before taking an investment decision in this Issue. Each prospective investor is advised to
consult its advisers about the particular consequences to it of an investment in the Equity Shares being issued pursuant to this
Placement Document.
The information on the Company’s website or any website directly or indirectly linked to such websites does not form part of this
Placement Document and prospective investors should not rely on such information.
Applications shall be made for the listing of the Equity Shares on the Bombay Stock Exchange Limited (the “BSE”), the National
Stock Exchange of India Limited (“NSE”) and the Delhi Stock Exchange Association Limited (“DSE”) (together the “Stock
Exchanges”). The Stock Exchanges assume no responsibility for the correctness of any statements made, opinions expressed or reports
contained herein. Admission of the Equity Shares to trading on the Stock Exchanges should not be taken as an indication of the merits
of the Company or the Equity Shares.
YOU MAY NOT AND ARE NOT AUTHORIZED TO (1) DELIVER THE PLACEMENT DOCUMENT TO ANY OTHER
PERSON OR (2) REPRODUCE SUCH PLACEMENT DOCUMENT IN ANY MANNER WHATSOEVER. ANY DISTRIBUTION
OR REPRODUCTION OF THIS DOCUMENT IN WHOLE OR IN PART IS UNAUTHORIZED. FAILURE TO COMPLY WITH
THIS DIRECTIVE MAY RESULT IN A VIOLATION OF THE SEBI GUIDELINES OR OTHER APPLICABLE LAWS OF INDIA
AND OTHER JURISDICTIONS.
A copy of the Preliminary Placement Document has been delivered to the Stock Exchanges. A copy of the Placement Document will
be filed with the Stock Exchanges. A copy of the Placement Document will also be delivered to the Securities and Exchange Board of
India (the “SEBI”) for record purposes.
THIS PLACEMENT DOCUMENT HAS BEEN PREPARED BY THE COMPANY SOLELY FOR PROVIDING INFORMATION
IN CONNECTION WITH THE PROPOSED ISSUE OF THE EQUITY SHARES DESCRIBED IN THIS PLACEMENT
DOCUMENT.
THIS ISSUE IS BEING MADE IN INDIA ONLY AND NON-RESIDENTS CANNOT PARTICIPATE IN THIS ISSUE.
This Placement Document is dated December 15, 2006
Sole Bookrunner
ENAM FINANCIAL CONSULTANTS PRIVATE LIMITED

801/802, Dalamal Towers
Nariman Point, Mumbai 400 021
Page 1 of 144
TABLE OF CONTENTS
DEFINITIONS AND ABBREVIATIONS.......................................................................................................... 8

SUMMARY OF BUSINESS .............................................................................................................................. 13
RECENT DEVELOPMENTS ........................................................................................................................... 15
SUMMARY OF THE ISSUE ............................................................................................................................ 18
RISK FACTORS ................................................................................................................................................ 19
MARKET PRICE INFORMATION ................................................................................................................ 27
USE OF PROCEEDS ......................................................................................................................................... 29
CAPITALIZATION........................................................................................................................................... 30
DIVIDEND POLICY ......................................................................................................................................... 31
SELECTED HISTORICAL FINANCIAL INFORMATION ........................................................................ 32
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS .......................................................................................................................... 35
INDUSTRY ......................................................................................................................................................... 45
BUSINESS........................................................................................................................................................... 55
REGULATIONS AND POLICIES ................................................................................................................... 70
BOARD OF DIRECTORS AND SENIOR MANAGEMENT........................................................................ 72
ORGANISATIONAL STRUCTURE AND PRINCIPAL SHAREHOLDERS............................................. 80
ISSUE PROCEDURE ........................................................................................................................................ 86
INDIAN SECURITIES MARKET ................................................................................................................... 93
DESCRIPTION OF THE SHARES.................................................................................................................. 99
TAXATION ...................................................................................................................................................... 106
LEGAL PROCEEDINGS................................................................................................................................ 109
INDEPENDENT ACCOUNTANTS ............................................................................................................... 111
GENERAL INFORMATION.......................................................................................................................... 112
INDEX TO FINANCIAL STATEMENTS..................................................................................................... 113
DECLARATION .............................................................................................................................................. 143
Page 2 of 144
NOTICE TO INVESTORS
The Company accepts responsibility for the information contained in this Placement Document and to the
best knowledge and belief of the Company, having made all reasonable enquiries, confirms that this
Placement Document contains all information with respect to the Company and the Equity Shares which is
material in the context of this Issue. The statements contained in this Placement Document relating to the
Company and the Equity Shares are, in every material respect, true and accurate and not misleading, the
opinions and intentions expressed in this Placement Document with regard to the Company and the Equity
Shares are honestly held, have been reached after considering all relevant circumstances, are based on
information presently available to the Company and are based on reasonable assumptions. There are no
other facts in relation to the Company and the Equity Shares, the omission of which would, in the context
of the Issue, make any statement in this Placement Document misleading in any material respect. Further,
all reasonable enquiries have been made by the Company to ascertain such facts and to verify the accuracy
of all such information and statements. The Sole Bookrunner has not separately verified the information
contained in this Placement Document (financial, legal or otherwise). Accordingly, neither the Sole
Bookrunner nor any member, employee, counsel, officer, director, representative, agent or affiliate of the
Sole Bookrunner makes any express or implied representation, warranty or undertaking, and no
responsibility or liability is accepted, by the Sole Bookrunner, as to the accuracy or completeness of the
information contained in this Placement Document or any other information supplied in connection with
the Equity Shares. Each person receiving this Placement Document acknowledges that such person has not
relied on the Sole Bookrunner nor on any person affiliated with the Sole Bookrunner in connection with its
investigation of the accuracy of such information or its investment decision, and each such person must rely
on its own examination of the Company and the merits and risks involved in investing in the Equity Shares.
Prospective investors should not construe anything in this Placement Document as legal, business, tax,
accounting or investment advice.
No person is authorized to give any information or to make any representation not contained in this
Placement Document and any information or representation not so contained must not be relied upon as
having been authorized by or on behalf of the Company or the Sole Bookrunner. The delivery of this
Placement Document at any time does not imply that the information contained in it is correct as at any
time subsequent to its date.
The distribution of this Placement Document and the issue of the Equity Shares in certain jurisdictions may
be restricted by law. As such, this Placement Document does not constitute, and may not 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 offer or solicitation. In particular, no
action has been taken by the Company or the Sole Bookrunner which would permit an offering of the
Equity Shares or distribution of this Placement Document in any jurisdiction, other than India, where action
for that purpose is required. Accordingly, the Equity Shares may not be offered or sold, directly or
indirectly, and neither this Placement Document nor any offering materials in connection with the Equity
Shares may be distributed or published in or from any country or jurisdiction except under circumstances
that will result in compliance with any applicable rules and regulations of any such country or jurisdiction.
In making an investment decision, investors must rely on their own examination of the Company and the
terms of this Issue, including the merits and risks involved. Investors should not construe the contents of
this Placement Document as legal, tax, accounting or investment advice. Investors should consult their own
counsel and advisors as to business, legal, tax, accounting and related matters concerning this offering. In
addition, neither the Company nor the Sole Bookrunner is making any representation to any offeree or
purchaser of the Equity Shares regarding the legality of an investment in the Equity Shares by such offeree
or purchaser under applicable legal, investment or similar laws or regulations. Each purchaser of the Equity
Shares in this offering is deemed to have acknowledged, represented and agreed that it is eligible to invest
in India and in the Company under Indian law, including Chapter XIII-A of the SEBI Guidelines and is not
prohibited by the SEBI or any other statutory authority from buying, selling or dealing in securities. Each
purchaser of Equity Shares in this offering also acknowledges that it has been afforded an opportunity to
request from the Company and review information relating to the Company and the Equity Shares.
Page 3 of 144
This Placement Document contains summaries of certain terms of certain documents, but reference is made
to the actual documents, copies of which will be made available upon request during the offering period for
physical inspection at the Registered Office of the Company located at Mumbai, Maharashtra, India,
subject to applicable confidentiality restrictions. All such summaries are qualified in their entirety by this
reference.
DISCLAIMER CLAUSE OF THE STOCK EXCHANGES
As required, a copy of the Preliminary Placement Document has been submitted to the Stock Exchanges.
The Stock Exchanges do not in any manner:
1. warrant, certify or endorse the correctness or completeness of any of the contents of the
Preliminary Placement Document
2. warrant that this Company’s Equity Shares will be listed or will continue to be listed on
the Stock Exchanges; or
3. take any responsibility for the financial or other soundness of this Company, its
promoters, its management or any scheme or project of this Company;
and it should not for any reason be deemed or construed to mean that the Preliminary Placement Document
has been cleared or approved by Stock Exchanges. Every person who desires to apply for or otherwise
acquires any securities of this Company may do so pursuant to an independent inquiry, investigation and
analysis and shall not have any claim against Stock Exchanges 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 for any other reason whatsoever.
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PRESENTATION OF FINANCIAL AND USE OF MARKET DATA
We prepare our financial statements in accordance with Indian GAAP. All discrepancies in the tables
included herein between the amounts listed and the totals thereof are due to rounding off.
We publish our financial statements in Rupees.
In this Placement Document, unless otherwise indicated or the context otherwise requires, all references to
“Pantaloon Retail (India) Limited,” “PRIL”, the “Company,” “we,” “our,” “us,” or similar terms are to
Pantaloon Retail (India) Limited, and references to “you” are to the prospective investors in the Equity
Shares. References in this Placement Document to “India” are to the Republic of India and the
“Government” are to the Governments of India, central or state, as applicable.
Our shareholders vide the annual general meeting dated November 17, 2006 approved the stock split of our
equity shares of Rs. 10 each to Rs. 2 each. As such the presentation of share data has been adjusted to
reflect the split in the face value of our shares unless specified otherwise. As of December 12, 2006, the
Equity Shares of the Company are being traded on the Stock Exchanges with the face value of Rs. 2 each.
The equity shares issued pursuant to this Placement Document and the existing Equity Shares shall rank
pari passu in all respects from the date of allotment.
The financial data presented in this Placement Document as of June 30, 2006, 2005 and 2004 have not been
adjusted to reflect the stock split.
Page 5 of 144
INDUSTRY AND MARKET DATA
Information regarding market position, growth rates and other industry data pertaining to our business
contained in this Placement Document consists of estimates based on data reports compiled by professional
organizations and analysts, data from other external sources and our knowledge of markets in which we
compete. The statistical information included in this Placement Document has been reproduced from
various trade, industry and government publications and websites. This data is subject to change and cannot
be verified with complete certainty due to limits on the availability and reliability of the raw data and other
limitations and uncertainties inherent in any statistical survey. In many cases, there is no readily available
external information (whether from trade or industry associations, government bodies or other
organizations) to validate market-related analyses and estimates, so we rely on internally developed
estimates. While we have compiled, extracted and reproduced this data from external sources, including
third parties, trade, industry or general publications, we accept responsibility for accurately reproducing
such data. However, neither we nor the Sole Bookrunner have independently verified this data and neither
we nor the Sole Bookrunner make any representation regarding the accuracy of such data. Similarly, while
we believe our internal estimates to be reasonable, such estimates have not been verified by any
independent sources and neither we nor the Sole Bookrunner can assure potential investors as to their
accuracy.
Page 6 of 144
FORWARD-LOOKING STATEMENTS
All statements contained in this Placement Document that are not statements of historical fact constitute
“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, our revenue and profitability, planned projects
and other matters discussed in this Placement Document regarding matters that are not historical facts.
These forward-looking statements and any other projections contained in this Placement Document
(whether made by us or any third party) are predictions and involve known and unknown risks,
uncertainties and other factors that may cause our actual results, performance or achievements to be
materially different from any future 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 us 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 our expectations include, among others:
• Change in the composition of cost of goods;

• Competitive pressures;
• Changes in consumer spending pattern;
• Other capital market and economic conditions; and
• Changes in regulatory laws.
Investors can generally identify forward-looking statements by terminology such as “aim”, “anticipate”,
“believe”, “expect”, “estimate”, “intend”, “objective”, “plan”, “project”, “shall”, “will”, “will continue”,
“will pursue” or other words or phrases of similar import. Similarly, statements that describe our strategies,
objectives, plans or goals are also forward-looking statements.
All forward looking statements are subject to risks, uncertainties and assumptions about us that could cause
actual results and property valuations to differ materially from those contemplated by the relevant
statement. Additional factors that could cause actual results, performance or achievements to differ
materially include, but are not limited to, those discussed under “Management’s Discussion and Analysis of
Financial Condition and Results of Operations,” “Industry” and “Business.
The forward-looking statements contained in this Placement Document are based on the beliefs of
management, as well as the assumptions made by and information currently available to management.
Although we believe that the expectations reflected in such forward-looking statements are reasonable at
this time, we cannot assure investors that such expectations will prove to be correct. Given these
uncertainties, investors are cautioned not to place undue reliance on such forward-looking statements. If
any of these risks and uncertainties materialize, or if any of our underlying assumptions prove to be
incorrect, our actual results of operations or financial condition could differ materially from that described
herein as anticipated, believed, estimated or expected. All subsequent written and oral forward-looking
statements attributable to us are expressly qualified in their entirety by reference to these cautionary
statements.
Page 7 of 144
DEFINITIONS AND ABBREVIATIONS
Definitions of Certain Capitalized Terms Used in this Placement Document
The following list of defined terms is intended for the convenience of the reader only and is not exhaustive.
Term Description
“Pantaloon Retail (India) Pantaloon Retail (India) Limited, a public limited company incorporated
Limited” or “PRIL” or “the under the Companies Act, 1956.
Company” or “our
Company”
“We” or “us” or “our” Refers to Pantaloon Retail (India) Limited and where the context requires,
its subsidiaries, which are enumerated in the section titled “Business”.
Allocated, Allocation The determination of QIBs for the purposes of inviting submission of
CAN, done in consultation with the Sole Bookrunner and in compliance
with Chapter XIII-A of the SEBI Guidelines.
Allotment Unless the context otherwise requires, the allotment of Equity Shares to
the successful Investors pursuant to the Issue.
Articles/Articles of Articles of Association of our Company.
Association
Auditor M/s. NGS & Company, formerly known as S.M. Kabra & Company
Bid An indication of QIBs’ interest, including all revisions and modifications
of interest, as provided in the Bid Form to subscribe for Equity Shares of
the Company under this Issue.
Bid Closing Date December 15, 2006
Bid Opening Date December 14, 2006
Bid Form The form pursuant to which a QIB shall submit a Bid.
Board of Directors/Board The board of directors of our Company or a committee constituted
thereof.
BOLT BSE On-Line Trading
CAN/Confirmation of Note or advice or intimation to QIBs for Allotment of Equity Shares after
Allocation Note discovery of the Issue Price.
Companies Act The Companies Act, 1956 as amended from time to time.
Cut-off Price The Issue Price which shall be finalized by the Company in consultation
with the Sole Bookrunner.
Depository A depository registered with SEBI under the SEBI (Depositories and
Participant) Regulations, 1996, as amended from time to time.
Depositories Act The Depositories Act, 1996, as amended from time to time.
Depository Participant A depository participant as defined under the Depositories Act.
Director(s) Director(s) on the Board of our Company, unless otherwise specified.
Equity Shares Equity shares of the Company of face value of Rs. 2 each, unless
Page 8 of 144
specified otherwise in the context thereof. The Company has split one
Equity Share of Rs. 10 face value into five Equity Shares of Rs. 2 each
pursuant to an AGM resolution dated November 17, 2006.
FEMA The Foreign Exchange Management Act, 1999, as amended from time to
time, and the regulations framed thereunder.
FII Foreign Institutional Investor (as defined under the Securities and
Exchange Board of India (Foreign Institutional Investors) Regulations,
1995) registered with SEBI under applicable laws in India.
Floor Price Rs. 326.58 which has been calculated in accordance with clause 13A.3 of
the SEBI Guidelines. The floor price has been adjusted to reflect the split
in Equity Shares to Rs. 2 per Equity Share
Investors Any prospective investor who makes a Bid pursuant to the terms of the
Preliminary Placement Document.
Issue The issue of Equity Shares to Qualified Institutional Buyers, pursuant to
Chapter XIII-A of the SEBI Guidelines.
Issue Price A price per Equity Share of Rs. 415.
Issue Size The issue of 6,265,060 Equity Shares aggregating to Rs. 2,599.99 million.
Memorandum/ The Memorandum of Association of our Company.

Memorandum of
Association
Mutual Fund A mutual fund registered with SEBI under the SEBI (Mutual Funds)
Regulations, 1996.
Pay-in Date The last date specified in the CAN sent to QIBs, as applicable.
Placement Document This Placement Document dated December 15, 2006, issued in
accordance with Chapter XIII-A of the SEBI Guidelines.
Preliminary Placement The Preliminary Placement Document, issued in accordance with Chapter
Document XIII-A of the SEBI Guidelines.
Promoter Kishore Biyani
QIBs or Qualified A Qualified Institutional Buyer as defined under clause 2.2.2B (v) of the
Institutional Buyers SEBI Guidelines. However, non-residents including FIIs, FVCIs as well
as foreign multilateral and bilateral development financial institutions are
not eligible to participate in this Issue.
Registrar of Companies Registrar of Companies, Mumbai, Maharashtra.
Relevant Date August 23, 2006 (i.e., the day which is thirty days prior to the date on
which the meeting of general body of shareholders was held viz
September 22, 2006, in terms of sub-section (1A) of Section 81 of the
Companies Act, 1956).
SEBI Guidelines The SEBI (Disclosure and Investor Protection) Guidelines, 2000 issued
by SEBI, as amended, including instructions and clarifications issued by
SEBI from time to time.
SEBI Act The Securities and Exchange Board of India Act, 1992, as amended from
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time to time.
Sole Bookrunner Enam Financial Consultants Private Limited
Stock Exchanges BSE, NSE and DSE
GAAP Generally Accepted Accounting Principles
Abbreviations
Abbreviation Full Form

AGM Annual General Meeting of the Company.
AS Accounting Standards as issued by the Institute of Chartered Accountants
of India.
ASE Ahmedabad Stock Exchange Limited
BSE Bombay Stock Exchange Limited
CAGR Compounded Annual Growth Rate.
CEO Chief Executive Officer.
CDSL Central Depository Services Limited.
Collection Bank UTI Bank Limited
DSE The Delhi Stock Exchange Association Limited
EGM Extraordinary General Meeting.
EPS Earnings Per Share.
FDI Foreign Direct Investment.
FICCI Federation of Indian Chambers of Commerce and Industry
FII Foreign Institutional Investors
FVCI Foreign Venture Capital Investors
FY/ Fiscal Financial Year/ Fiscal year.
Financial year /Fiscal Year Period of twelve months ending June 30 of that particular year, unless
otherwise stated.
GDP Gross Domestic Production.
GoI Government of India.
IAS International Accounting Standards.
ICAI Institute of Chartered Accountants of India.
IFRS International Financial Reporting Standards.
I.T. Act The Income Tax Act, 1961, as amended from time to time.
MOU Memorandum of Understanding.
NAV Net Asset Value.
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NSDL National Securities Depository Limited.
NSE National Stock Exchange of India Limited.
p.a. Per annum.
P/E Price/Earnings Ratio.
PAN Permanent Account Number.
RBI The Reserve Bank of India.
RoC The Registrar of Companies, Mumbai, Maharashtra.
SEBI The Securities and Exchange Board of India constituted under the SEBI
Act, 1992.
Securities Act U.S. Securities Act of 1933, as amended.
Takeover Code SEBI (Substantial Acquisition of Shares and Takeovers) Regulations,
1997.
Technical and Industry Terms and Abbreviations

Anchor Tenant A commercial retail business such as a national chain store or regional
department store, placed in a shopping centre which usually enjoys
privileged commercial terms
Aspirational Products Good quality and high priced lifestyle products

Catchment Studies Systematic study of consumption and spending habits of an individual or
family in target area based on parameters such as age group, sex,
preference, purchase category
Category Killers Dominant retailers in terms of profitability and growth of market shares.
CDMA Code Division Multiple Access.
Department Store A retail organization that normally employs approximately 25 or more
people and sells merchandise in the following categories: home
furnishings, apparel for men, women, and children, and home linens and
dry goods.
Distribution Centres A warehouse which processes, moves and stores goods
A storage facility that takes orders and delivers products.
FMCG Fast moving consumer goods
Format It is a type of retail store to sell a specific nature of goods to a particular
segment of customers
GSM Global System for Mobile Communications
High Street A place or locality in a major city or principal street of a small town;
which would be the main point of purchase from well known shops
stocking high quality, apparels and non-apparels
Hypermarkets A large retail operation which combines the features of a Supermarket
and a discount house
IT Information Technology
ITES/BPO Information technology enabled Services and Business Process
Outsourcing
Lifestyle Products/ Products that meet way of living centred around certain activities
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Lifestyle Merchandise
Lifestyle Retailing The stores under this category primarily retail non-food items such as
apparel, footwear, accessories, cosmetics and household products.
Private Label Brands that are developed in house by the retailer
SKUs Stock keeping units, is the smallest unit available for keeping inventory
control.
Shrinkage Loss in inventory on account of a combination of employee theft,
shoplifting, vendor fraud and administrative error
Supermarkets A self service store that satisfies regular shopping needs of consumers,
including food and non food items
Square feet sq. ft.
Value Retailing The stores under this category retail mainly food and household items.
These are primarily large stores with volume based discounted prices
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SUMMARY OF BUSINESS
Overview
We are one of India’s leading organised multi format retailers and are pioneers in Indian hyper market
business, promoted by Kishore Biyani. We are a part of the Future Group.
From our beginning in 1987, we have today evolved as one of the leading retailer and are among the
pioneers in setting up a nation-wide chain of large format stores in India. We believe that the various
initiatives taken by us have played a key role in enhancing the standards of retail in the country. We are an
entrepreneur driven, professionally managed retailer focused on meeting the customer requirements for a
large component of their spend across fashion, food, general merchandise, home in both value and lifestyle
segments. We have also entered into partnerships and joint ventures to expand our offerings from home to
apparel to household products to durables etc. We believe our focus on customers supported by systems
and processes and a committed work force are the key factors that have contributed to our success and will
help us scale up as we embark on our strategic growth plan.
We started our operations with one store in Kolkata in 1996, occupying an area of 8000 sq ft. Presently we
operate 125 stores, (including franchisee stores and factory outlets) in over 25 cities spread across the
country occupying an aggregate area of 3,165,498 sq ft (as on October 15, 2006). .
Our business is identifiable under two major segments (i) Value retailing; and (ii) Life Style retailing. We
cater the Life Style retailing segment through 22 Pantaloon stores, 3 Central Malls, and 10 speciality retail
stores (includes 6 aLL stores, and 4 Blue Sky outlets). In Value Retailing segment, cater to our customers
needs through our 33 Big Bazaar, 48 Food Bazaar Outlets and 9 speciality retail stores (includes 5 Fashion
Stations, 3 Depot Stores and 1 Health Village Outlet).
We believe that managing customer expectation by offering them all the requirements for their entire
family under one roof is the key to being a successful retailer, and hence have built our business model
around ‘Family focus’ rather than ‘individual focus’. We believe addressing the family attracts more
customers into the store.
We retail a range of branded and private label apparel, footwear, perfumes, cosmetics, jewellery, leather
products and accessories, home products, books, music and toys in our stores. To complete the idea of a
family store, besides garments, we also retail household items, consumer durables, and home furnishings,
apart from food and personal care products. This is complemented by cafes, food stalls, entertainment,
personal care and various beauty related services. Promotions and events are an integral part of our service
offering to our customer, which helps us create a unique shopping experience.
We believe our offerings provide to our customers a unique shopping experience, comprising of a vast
range of lifestyle and value retail products, mix of retailing formats coupled with the facility of
entertainment and leisure.
We have 14 subsidiaries and six joint venture entities supplementing our business.
Our Competitive Strengths
We believe our competitive strengths include the following;
• Brand equity and early mover advantage;
• Entrepreneur led, professionally managed by an experienced team;
• Project execution and operations capabilities;
• Vast range of lifestyle and value retail products and services;
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• Strong focus on systems and processes;
• Strong distribution and logistics network and supply chain;
• strong distribution and logistics network, with our 21 distribution centres covering; and
• Large base of customers.
Our Strategy
We intend to maintain and enhance our position as a leading retail entity through continued focus on the
Indian market and investing further in our competitive strengths to grow our business. The key elements of
our business strategy include:
• Provide Everything, Everywhere, Everytime to Every Indian Consumer;

• Penetration in Key Markets;
• Capturing share of consumer spend;
• Property supply pipeline;
• Private Labels and own brands;
• Strategic Relationships;
• Learning and caring organisation; and
• Robust and scalable systems.
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RECENT DEVELOPMENTS
Stock Split
The Company has split one Equity Share of Rs. 10 face value into five Equity Shares of Rs. 2 each
pursuant to an AGM resolution dated November 17, 2006. As of December 12, 2006, the Equity Shares of
the Company are being traded on the Stock Exchanges with the face value of Rs. 2 each
Results of Operations for the Three Month Period Ended September 30, 2006
Our total income increased by 74.78 % to Rs. 6,389.12 million for the three month period ended September
30, 2006 from Rs. 3,655.53 million for the three month period ended September 30, 2005. Our profit before
tax increased by 301.24 % to Rs.579.31 million for the three month period September 30, 2006 from
Rs.192.31 million for the three month period ended September 30, 2005. Our profit after tax increased by
185.72% to Rs. 386.38 million for the three month period ended September 30, 2006 from Rs.135.23
million for the three month period ended September 30, 2005.
The selected interim financial information presented below is unaudited standalone financials and is
prepared and presented in accordance with Indian GAAP.
(Rs. Million)
Sr. No. Particulars 3 Months 3 Months ended
ended September 30,
September 30, 2005
2006
Gross Turnover 6,587.00 4,133.00
1 Net Sales/ Income from operations 6,033.66 3,648.31
2 Other Income 355.46 7.22
3 Total Expenditure 5,618.22 3,368.42
a) (Increase)/Decrease in Stock in trade (391.33) (450.46)
b) Consumption of Raw 4,366.12 2,898.52
Material/ Cost of finished goods
c) Staff Cost 454.43 185.90
d) Other Expenditure 1,189.00 734.46
4 Interest & Finance charges 124.64 57.22
5 Depreciation 66.95 37.58
6 Profit before Taxation (1+2-3-4-5) 579.31 192.31
7 Provision for taxation - -
a) Fringe Benefit Tax 4.02 2.02
b) Current Tax 76.18 24.07
c) Deferred Tax 112.73 30.99
8 Earlier years income tax - -
9 Net profit (6-7-8) 386.38 135.23
10 Paid-up Equity Share Capital 268.85 219.98
(Face Value - Rs. 10/- per share)
11 Reserves excluding revaluation reserves - -
12 Basic EPS (in Rs.) 14.37 5.38
Page 15 of 144
13 Diluted EPS (in Rs.) 14.37 5.38
14 Basic EPS (in Rs.) (Face Value Rs. 2/-) 2.87 1.08
15 Diluted EPS (in Rs.) (Face Value Rs. 2/-) 2.87 1.08
Notes
• The Company had raised Rs. 2,239.40 million through issue of shares on right basis and out of the said
amount Rs. 2,128.50 million has been deployed towards funding for setting up of new stores and
warehouses, renovation of existing stores and warehouses, expansion and upgrade, etc.
• Paid up share capital of the Company has increased from Rs. 268,846,210 to Rs. 268,847,810 due to
allotment of 160 shares to the shareholders whose entitlement were kept under abeyance in the Rights
issue.
• Other Income for the quarter ended September 30, 2006 includes profit on sale of investment of Rs.
338.00 million
Segment Reporting
(Rs. Million)
Sr. Particulars 3 Months 3 Months ended
No. ended September 30,
September 30, 2005
2006
1 Segment Revenue
Value Retailing 4,364.93 2,446.79
Lifestyle :Retailing 1,656.56 1,101.92
Others 106.84 172.22
6,128.32 3,720.93
Less : Inter Segment Revenue 94.66 72.62
Net Sales/Income from Operation 6,033.66 3,648.31
2 Segment Profit
Profit Before Tax & Interest
Value Retailing 333.14 182.78
Lifestyle Retailing 226.95 162.21
560.09 344.98
Less : 1) Interest 124.64 57.22
2) Other Unallocable Expense (143.86) 95.45
net of unallocable income
Total Profit Before Tax 579.31 192.31
3 Capital Employed
Value Retailing 7,227.61 3,050.23
Lifestyle Retailing 4,228.24 2,257.15
Unallocated 2,087.95 532.50
Total Capital Employed 13,543.81 5,839.88
Page 16 of 144
Others
The Delhi International Airport Private Limited has awarded the duty free shopping contract for the Indira
Gandhi International Airport, New Delhi to the Alpha-Pantaloon consortium, which is a joint venture
between UK based Alpha Airports Group Plc. and the Company.
Recent Corporate Announcements
1. Our Board at its meeting held on November 17, 2006 has approved the formation of a subsidiary
company for carrying on business in office supplies and approved investment up to Rs 175.0
million; and also approved the formation of a subsidiary Company in Hongkong to source
products and approved an investment of up to US$ 1 million.
2. The Company has recently through its Board meeting dated October 27, 2006 approved a proposal
to merge PAN India Restaurants Limited with a company forming a part of the promoter group
called Galaxy Entertainment Corporation Limited. The merger is subject to finalisation of
valuations, exchange ratios, schemes etc.
Page 17 of 144
SUMMARY OF THE ISSUE
The following is a general summary of the terms of the Issue:
Issuer Pantaloon Retail (India) Limited

Issue Size 6,265,060 Equity Shares of the Company of Rs. 2
each. The Company has split one Equity Share of
Rs. 10 face value into five Equity Shares of Rs. 2
each pursuant to an AGM resolution dated
November 17, 2006.
Issue Price Rs. 415/- per Equity Share

Eligible Investors QIBs
Equity Shares issued and outstanding 134,423,105 (and 12,300 Equity Shares in
immediately prior to and after the Issue abeyance totalling 134,435,405) Equity Shares
issued and outstanding immediately prior to the
Issue. Immediately after the Issue, 140,688,165
Equity Shares will be issued and outstanding (
excluding the shares arising out of conversion of
outstanding warrants)
The Company has issued and allotted 1,212,480
warrants with an option to the warrant holders to
acquire, for every warrant, five fully paid up equity
share for Rs.2 each at a price of Rs. 1,635 per
warrant aggregating to a total of Rs. 198,24,04,800
to the Promoter and promoter group on a
preferential allotment basis. The issue of warrants
has been approved by the shareholders of the
Company in its extraordinary general meeting held
on September 22, 2006.
Listing The Company shall make applications to each of
the Stock Exchanges to obtain in-principle
approvals for the listing of the Equity Shares on the
Stock Exchanges.
Transferability Restriction The Equity Shares being allotted pursuant to
this Issue shall not be sold for a period of one
year from the date of Allotment except on a
recognized stock exchange in India.
Use of Proceeds The net proceeds of this Issue (after deduction of
fees, commissions and expenses) are expected to
be approximately Rs. 2,521.99.
We intend to use the net proceeds received from
the Issue to accelerate further growth, fund various
expansion plans, long-term working capital
requirements, to finance investment opportunities
and for general corporate purposes.
Page 18 of 144
RISK FACTORS
This offering involves a high degree of risk. You should carefully consider the risks described below before
making an investment decision. If any of the risks described below actually occur, our business, prospects,
financial condition and results of operation could be seriously harmed, the trading price of our shares could
decline and you may lose all or part of your investment.
Internal Risk Factors
Our products include a range of lifestyle merchandise, services and Aspirational Products which may be
seasonal due to the bunching of festivals like Durga Puja, Diwali, Christmas and Id in the second
quarter of our financial year and hence our ability to forecast and correctly understand fashion cycles
and customer preference is critical for our continued operations
We retail products and services that our customers require including Lifestyle and Aspirational Products.
Our success is dependent on our ability to meet our customers’ requirements. We plan our products based
on forecasts of customers buying patterns as well as on forecasts of fashion and trends for forthcoming
seasons. Any mismatch between our forecasts, our planning and the actual purchase by customers can
impact us adversely, leading to excess inventory and requiring us to resort to higher markdown and thus
lower margins in order to clear such inventory. Customer preferences are susceptible to change with change
in fashion and trends, and their service level expectations too can change from time to time.
Our success depends partly upon our ability to forecast, anticipate and respond to such changing consumer
preferences and fashion trends in a timely manner. Any failure by us to identify and respond to such
emerging trends in consumer preferences could have a material adverse effect on our business.
Further, the success of our Private Label strategy depends on our ability to understand fashion trends,
introduce new designs/apparels and explore new business opportunities on a regular basis. Our inability to
identify and recognize international and domestic fashion trends and the risk of obsolescence could
adversely affect our business. We could be adversely affected if consumers lose confidence in the safety
and quality of certain food products sold as Private Labels and are discouraged from buying our products.
The success of our business is dependent on supply chain management
We strive to keep optimum inventory at our stores and distribution centre to control our working capital
requirements. Inefficient supply chain management may lead to unavailability of merchandise. Ensuring
shelf availability for our products warrants quick turnaround time and high level of coordination with
suppliers. Food and grocery items require efficient supply chain management as this involves items which
are perishable or have limited shelf life. For some of our perishable goods we outsource our supply chain
management to third party sources. Inefficient supply chain management could adversely affect the results
from operations.
Failure to manage the integration of the businesses or facilities we acquire may cause our profitability to
suffer.
We have pursued acquisitions and strategic partnerships as part of our growth strategy. We intend to
continue entering into acquisitions and strategic alliances. Our acquisitions may not contribute to our
profitability, and we may be required to incur or assume debt, or assume contingent liabilities, as part of
any acquisition. Our acquisitions may give rise to unforeseen contingent risks or latent liabilities relating to
these businesses that may only become apparent after the merger or the acquisition is finalised. We could
have difficulty in assimilating and retaining the personnel, operations and assets of the acquired company.
The loss of any available tax exemptions pursuant to an acquisition could adversely impact our results of
operations. These difficulties could disrupt our ongoing business, distract our management and employees
and increase our expenses and materially affect our profits. Further, we may not be able to accurately
identify or forge an alliance with appropriate companies in line with our growth strategy. In the event that
the alliance does not perform as estimated, our operations may be materially adversely affected.
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Further, larger number of stores will increase our fixed operating costs, and there can be no assurance that
we will experience a commensurate increase in revenue or derive operational synergies to offset these
higher costs. Our inability to manage our growth could have a material adverse effect on our business,
financial condition and results of operations.
We have broad discretion in the use of the net proceeds of this Issue and you may not necessarily agree
with how we use such proceeds.
Subject to compliance with applicable laws and regulations, we intend to use the net proceeds received
from the Issue to accelerate further growth, fund various expansion plans, long-term working capital
requirements, to finance investment opportunities and for general corporate purposes. As of the date of this
Placement Document, we have not entered into any letter of intent or any definitive commitment or
agreement for the use of proceeds.
In accordance with the policies set up by our Board, the management will have flexibility in deploying the
proceeds received by us from the Issue. Pending utilization for the purpose described above, we intend to
temporarily invest funds in creditworthy instruments, including money market mutual funds and deposits
with banks. Such investments would be in accordance with the investment policies approved by the Board
from time to time.
Our business plans may need substantial capital and additional financing in the form of debt and/or
equity to meet our requirements.
Our proposed business plans are being substantially funded through this Issue and partly by our internal
cash accruals. However the actual amount and timing of future capital requirements may differ from
estimates including but not limited to unforeseen delays or cost overruns, unanticipated expenses, market
developments or new opportunities in the industry. We may also not be able to generate internal cash in our
Company as estimated and may have to resort to alternate sources of funds. Sources of additional financing
may include commercial borrowings, vendor financing, or issue of equity or debt instruments. If we decide
to raise additional funds through the debt route, the interest obligations would increase and we may be
subject to additional covenants, which could limit our ability to access cash flows from the operations. If
we decide to raise additional funds through the equity route, your shareholding in the Company could get
diluted.
Any inability to manage our rapid growth could disrupt our business
We have experienced high growth in recent periods. Our sales and operating income has grown at a CAGR
of 62.72% from FY 2002 to FY 2006. However, our future growth plans can place significant demands on
our management and other resources. There can be no assurance that we will be able to execute our strategy
on time and within the stipulated budget or that we will meet the expectations of the customers and achieve
our planned growth.
Losses on account of shrinkage can negatively impact our profitability
Shrinkage in the retail buisness is defined as the loss in inventory on account of a combination of employee
theft, shoplifting, vendor fraud and administrative error. The retail industry the world over is affected by
shrinkage. Any increase in shrinkage levels at our existing and future stores can adversely impact results
from operations.
We face growing and new competition from domestic and potential international players that may
adversely affect our competitive position and our profitability.
Significant additional competition in the retail industry may result in reduced prices and thereby negatively
affect our revenues and profitability. Further, the introduction of foreign participation in the retail sector
will result in the entry of multinational retail companies into the Indian market. We cannot assure you that
we will be able to compete with large multinational players.
Page 20 of 144
International competitors may enjoy many of the same advantages that we do and may even have lower
cost structures, enabling them to compete vigorously vis-à-vis pricing. Competition from these competitors
may adversely impact our revenues. Global companies are significantly larger than us and have
significantly stronger international market positions, production capacities and greater financial resources
than we do. We also face significant competition from Indian players. These market participants include
other small, limited-service providers and a number of full-service global companies. The larger
competitors have a much broader portfolio of business, greater resources and more experience than smaller
companies.
Competition may impede our ability to renew leases or licences entered into by us. Further, we may not
be able to attract concessionaires, which may affect our concessionaire income.
We face competition from other large retailers who compete for scarce real estate resources. We may not
be able to renew our leases or licenses on terms acceptable to us. Our competitors may also provide
attractive terms to concessionaires who currently operate from our stores which may reduce our ability to
attract concessionaires. In the event that any of our leases or licenses are not renewed, and we are required
to vacate our stores, we may be required to identify alternative real estate and enter into fresh lease or leave
and licence agreements which could result in loss of business and may adversely affect our operations and
profitability.
Any adverse impact on the title or ownership rights or development rights of our landlords from whose
premises we operate may impede our effective operations of our stores, offices or distribution centres in
the future
Some of the premises from which we operate our stores / offices / distribution centres are taken by us on
long term lease or sub-lease or leave and licence or on conducting basis and/or on the basis of other
contractual agreements with third parties. We may continue to enter into such transactions with third
parties. Any adverse impact on the title / ownership rights / development rights of our landlords from
whose premises we operate our stores may impede our business, our operations and our profitability. The
financial impact of such aforesaid risk cannot be quantified.
Additionally, some of our lease agreements prescribe a lock-in period. These lock in periods prevent us
from moving our stores in the event that there are events or circumstances that impede our profitability.
Any such event and such restrictive covenants in our lease agreements affect our ability to move the
location of our stores and may adversely affect our business, financial condition and results of operations.
We face the risk of potential liabilities from lawsuits or claims by consumers
We may face the risk of legal proceedings and claims being brought against us by our customers /
consumers for any defective product sold or any deficiency in our services to them. We could face
liabilities should our customers / consumers face any loss or damage due to any unforeseen incident such as
fire or accidents in our stores, which could cause financial or other damage to our customers / consumers.
Any commencement of lawsuits as envisaged above against us could reduce our sales.
Changes in safety and health laws and regulations may adversely affect our results of operations and
our financial condition.
We are subject to a broad range of safety and health laws and regulations in the areas in which we operate
such as the Consumer Protection Act, 1986, the Standards of Weights and Measures Act, 1976, Sale of
Goods Act, 1930 and similar state regulatory enactments like the Shop and Establishments Acts. These
laws and regulations impose controls on our fire safety standards, and other aspects of our operations. We
have incurred, and expect to continue to incur, operating costs to comply with such laws and regulations.
In addition, we have made and expect to continue to make capital expenditures on an ongoing basis to
comply with safety and health laws and regulations. While we believe we are in compliance in all material
respects with all applicable safety, health and environmental laws and regulations, we may nevertheless be
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liable to the Government of India or the State Governments or Union Territories with respect to our failures
to comply with applicable laws and regulations.
Further, the adoption of new safety and health laws and regulations, new interpretations of existing laws,
increased governmental enforcement of laws or other developments in the future may require that we make
additional capital expenditures or incur additional operating expenses in order to maintain our current
operations or take other actions that could have a material adverse effect on our financial condition, results
of operations and cash flow. Safety, health and environmental laws and regulations in India, in particular,
have been increasing in stringency and it is possible that they will become significantly more stringent in
the future.
The costs of complying with these requirements could be significant. The measures we implement in order
to comply with these new laws and regulations may not be deemed sufficient by governmental authorities
and our compliance costs may significantly exceed current estimates. If we fail to meet safety and health
requirements, we may also be subject to administrative, civil and criminal proceedings by governmental
authorities, as well as civil proceedings by our consumers / customers and other individuals, which could
result in substantial fines and penalties against us as well as orders that could limit our operations.
There can be no assurance that we will not become involved in future litigation or other proceedings or be
held responsible in any such future litigation or proceedings relating to safety and health matters in the
future, the costs of which could be material. Remediation costs of our stores and outlets and related
litigation could adversely affect our cash flow, results of operations and financial condition.
Negative publicity if any, would adversely affect the value of our brand, and our sales.
Our business is dependent on the trust our customers have in the quality of our merchandise as well as on
our ability to protect our trademarks and copyrights and our intellectual property to maintain our brand
value. If we fail to adequately protect our intellectual property, competitors may market products similar to
ours. Any negative publicity regarding the Company, brands, or products, including those arising from a
drop in quality of merchandise from our vendors, disputes concerning the ownership of intellectual
property, mishaps at our stores, or any other unforeseen events could adversely affect our reputation our
brand value, our operations and our results from operations.
We continue to launch new formats as divisions, subsidiaries or through joint ventures with partners. A
lower than anticipated customer response to such formats, or the inability of our joint venture to
successfully meet customer requirements can adversely impact us.
We operate different formats like Pantaloons, Big Bazaar, Food Bazaar etc and continue to launch new
formats like aLL, Fashion Station, Depot. The success of these formats depends upon the customer
response. A lower than anticipated customer response can impact business. We have also entered into joint
venture agreements to expand the scope of our products and services. Any inability of our joint venture
partner to successfully attract and meet with customer requirements may adversely affect our operations
and profitability.
The success of our business is substantially dependent on our management team, our inability to retain
them could adversely affect our businesses
We have a strong team of professionals to oversee the operations and growth of our businesses. Our ability
to sustain our growth depends, in large part, on our ability to attract, train, motivate and retain highly
skilled personnel. We believe that there is significant demand for personnel who possess the skills needed
to perform the services we offer. Our inability to hire and retain additional qualified personnel will impair
our ability to continue to expand our business. An increase in the rate of attrition for our experienced
employees, would adversely affect our growth strategy. We cannot assure you that we will be successful in
recruiting and retaining a sufficient number of personnel with the requisite skills to replace those personnel
who leave. Further, we cannot assure you that we will be able to re-deploy and re-train our personnel to
keep pace with continuing changes in our business. The loss of the services of such personnel and our
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inability to hire and retain additional qualified personnel may have an adverse effect on our business,
financial condition and results of operations.
Our Promoter and promoter group will control us as long as they own a substantial portion of our
Equity Shares, and our other shareholders may not be able to affect the outcome of shareholder voting
during such time
After completion of the Issue, the Promoter and promoter group will continue to own approximately 42.27
% of our issued Equity Share Capital So long as the Promoter and promoter group own a substantial
portion of our Equity Shares, they may be able to elect a substantial number of our board of directors and
remove any director, by way of a resolution approved by a simple majority of shareholders in a general
meeting. The Promoter and promoter group will be able to control most matters affecting us, including the
appointment and removal of our officers; our business strategy and policies; any determinations with
respect to mergers, business combinations and acquisitions or dispositions of assets; our dividend payout;
and our capital structure and financing. Further, the extent of Promoter and promoter group shareholding in
us may result in delay or prevention of a change of management or control of our Company, even if such a
transaction may be beneficial to our other shareholders.
Further, our Articles of Association confer certain rights on our Promoter Kishore Biyani and his father,
Laxminarayan Biyani wherein Kishore Biyani shall be a permanent Director who shall be entitled to vacate
such position only upon him resigning or dying or retiring at his own will and Laxminarayan Biyani shall
have the right to nominate up to a maximum of 6 persons as Directors. Accordingly, Laxminarayan Biyani
and Kishore Biyani have the ability to exercise significant influence over the functioning of our Board
including matters that require our Board’s approval or our shareholders approval.
The extent of this control may delay, hamper or prevent a change in control of us, impede a merger,
consolidation, take over or discourage a potential buyer from making a tender or an offer or otherwise
attempt to take control over us.
Our indebtedness could adversely affect our financial condition and results of operations
We have entered into agreements with certain banks and financial institutions for long term borrowings.
Some of these agreements contain restrictive covenants that require us to obtain the prior consent of our
lenders to take certain actions, including declaration of dividends, alteration of our capital structure,
formulation of any scheme of amalgamation or reconstruction, expenditure in new projects, entering into
borrowing arrangements, investing by way of share capital or lending or advancing funds or placing
deposits with other concerns, undertaking guarantee obligations, creating charge, lien, or its undertakings or
any part thereof, entering into any contractual obligation of a long term nature or significantly affecting the
Company financially, changing Company practice with respect to the remuneration of directors,
undertaking any other trading activity other than the sale of products arising out of the sale of its
manufacturing operations, disposing off assets and compromising with any of its creditors, changing its
name or trade name, creating any subsidiary or permitting any company to become a subsidiary and making
changes to the management, set up and key personnel. In addition, certain of these agreements require us to
maintain various financial ratios, and may provide certain lenders with the right to appoint a nominee
director on our Board. In addition, certain of these agreements require us to obtain the prior consent of our
lenders for any variation of the shareholding of directors, promoters and principal shareholders, including
by issue of new shares or the transfer of shares.
We have a number of contingent liabilities, and our profitability could be adversely affected if any of
these contingent liabilities materialize
Our contingent liabilities as of June 30, 2006 include unexpired guarantees and letters of credit, bills
discounted with banks and claims against us not acknowledged as debt amounting to Rs. 204.25 million. If
any of these contingent liabilities materialize, our profitability may be adversely affected.
Page 23 of 144
There is a possibility of a conflict of interest with the entities forming part of the promoter group of the
Company.
The object clauses as contained in the memorandum of association of some of the companies forming part
of the promoter group enable them to carry on the business of establishing/operating/managing retail
outlets. In case these companies decided to venture into the similar line of businesses, it may result in our
Promoters having a conflict of interest with our line of business.
We are a member of the ‘Future Group’ and we utilise the logo and the trademark of the Future Group
as a part of our corporate identity
We have entered into a license agreement with Future Ideas Company Limited on October 14, 2006 for the
use of the trademark and logo appearing on the cover page of this document. The license agreement is valid
for a period of one year from October 15, 2006 to October 14, 2007 and the period mutually agreed to by
the parties thereafter.
We operate in a competitive environment, where generating brand recognition will be a significant part of
our business and growth strategy. In the event that we fail to renew the licence agreement, we may need to
change our logo. Any such change could require us to incur additional costs and may adversely impact our
business, financial condition and results of operation.
External Risk Factors
The success of our business is highly dependent on the number of customers that visit our stores.
Various factors affect the customer footfalls, including choice of location and nature of floor layout.
Factors such as the regional economy, weather conditions, natural disasters, social unrest as well as
government regulations specific to the states in which we operate also affect our result from operations
Force majeure events, particularly those affecting the states of where our facilities are located, could
adversely affect our business
We are headquartered in the state of Maharashtra and our facilities are located across India. It is possible
that earthquakes, cyclones, floods or other natural disasters in India, particularly those that directly affect
the areas in which our facilities and other operations are located, could result in substantial damage to our
manufacturing facilities and other assets and adversely affect our operations and financial results.
There may not be an active or liquid market for our Equity Shares, which may cause the price of the
Equity Shares to fall and may limit your ability to sell the Equity Shares.
The offer price of the Equity Shares in this Issue will be determined by the Company in consultation with
the Sole Bookrunner based on the Bids received in compliance with Chapter XIII-A of the SEBI
Guidelines, and it may not necessarily be indicative of the market price of the Equity Shares after this Issue
is complete. You may be unable to resell your Equity Shares at or above the offer price and, as a result, you
may lose all or part of your investment. The price at which the Equity Shares will trade after this Issue will
be determined by the marketplace and may be influenced by many factors, including:
• our financial results and the financial results of the companies in the businesses we operate in;
• the history of, and the prospects for, our business and the sectors and industries in which we
compete;
• an assessment of our management, our past and present operations, and the prospects for, and
timing of, our future revenues and cost structures;
• the present state of our development; and
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• the valuation of publicly traded companies that are engaged in business activities similar to ours.
In addition, the Indian stock market has from time to time experienced significant price and volume
fluctuations that have affected the market prices for the securities of Indian companies. As a result,
investors in the Equity Shares may experience a decrease in the value of the Equity Shares regardless of our
operating performance or prospects.
The market price of our Equity Shares may fluctuate due to the volatility of the Indian securities market
The Indian securities markets may be more volatile than the securities markets in other countries. Stock
exchanges in India have, in the past, experienced substantial fluctuations in the prices of listed securities.
The stock exchanges in India have experienced problems, including broker defaults and settlement delays,
which, if they were to continue or recur, could affect the market price and liquidity of the securities of
Indian companies, including the Equity Shares. In addition, the governing bodies of the various Indian
stock exchanges have from time to time imposed restrictions on trading in certain securities, limitations on
price movements and margin requirements. Furthermore, from time to time disputes have occurred between
listed companies and stock exchanges and other regulatory bodies, which in some cases may have had a
negative effect on market sentiment.
For example, in May 2006, the Indian stock exchanges witnessed substantial volatility. The BSE and the
NSE, India’s main stock exchanges, halted trading on May 22, 2006 after the respective indices fell more
than 10%. Trading was halted on these exchanges for one hour. The BSE fell 10.16% to 9,826.91 points,
falling below 10,000 for the first time in three months.
Future issues or sales of our Equity Shares may significantly affect the trading price of our Equity
Shares
The future issue of Equity Shares by us or the disposal of Equity Shares by any of our major shareholders
or the perception that such issuance or sales may occur may significantly affect the trading price of the
Equity Shares. Subject to these restrictions, no assurance may be given that we will not issue Equity Shares
or that such shareholders will not dispose of, encumber or pledge these Equity Shares in the future.
There are restrictions on daily movements in the price of the Equity Shares, which may adversely affect
a shareholder’s ability to sell, or the price at which it can sell, Equity Shares at a particular point in
time.
We are subject to a daily “circuit breaker” imposed by all stock exchanges in India, which does not allow
transactions beyond specified increases or decreases in the price of the Equity Shares. This circuit breaker
operates independently of the index-based market-wide circuit breakers generally imposed by SEBI on
Indian stock exchanges. The percentage limit on our circuit breakers is set by the stock exchanges based on
the historical volatility in the price and trading volume of the Equity Shares.
The stock exchanges do not inform us of the percentage limit of the circuit breaker in effect from time to
time, and may change it without our knowledge. This circuit breaker limits the upward and downward
movements in the price of the Equity Shares. As a result of this circuit breaker, no assurance may be given
regarding your ability to sell your Equity Shares or the price at which you may be able to sell your Equity
Shares at any particular time.
There is no guarantee that the Equity Shares will be listed on the BSE and the NSE in a timely manner
or at all, and any trading closures at the BSE and the NSE may adversely affect the trading price of our
Equity Shares.
In accordance with Indian law and practice, permission for listing of the Equity Shares will not be granted
until after those Equity Shares have been issued and allotted. Approval will require all other relevant
documents authorizing the issuing of Equity Shares to be submitted. There could be a failure or delay in
Page 25 of 144
listing the Equity Shares on the BSE and the NSE. Any failure or delay in obtaining the approval would
restrict your ability to dispose of your Equity Shares.
The regulation and monitoring of Indian securities markets and the activities of investors, brokers and other
participants differ, in some cases significantly, from those in Europe and the U.S. The BSE and the NSE
have in the past experienced problems, including temporary exchange closures, broker defaults, settlements
delays and strikes by brokerage firm employees, which, if continuing or recurring, could affect the market
price and liquidity of the securities of Indian companies, including the Equity Shares, in both domestic and
international markets. A closure of, or trading stoppage on, either of the BSE and the NSE could adversely
affect the trading price of the Equity Shares. Historical trading prices, therefore, may not be indicative of
the prices at which the Equity Shares will trade in the future.
The mechanism of Qualified Institutional Placement (“QIP”) under Chapter XIII-A of the SEBI
Guidelines has been recently introduced and hence the process is new.
The SEBI has introduced the mechanism of QIP by an amendment to the SEBI Guidelines dated May 8,
2006 to provide for speedy and effective institutional placements by listed Indian companies. However, this
mechanism and its efficiency has not yet been established. QIBs are thus advised to make their own
judgment about investment through this mechanism.
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MARKET PRICE INFORMATION
As of September 30, 2006, 134,423,105 (and 12,300 shares in abeyance totalling 134,435,405) of our
Equity Shares were issued and outstanding. We issued 4,481,180 fully paid up equity shares of Rs. 10 each
(equivalent to 22,405,900 Equity Shares of Rs. 2 each ) to equity shareholders on rights basis in the ratio of
one equity share of Rs. 10 each for every five equity shares of Rs. 10 each held on the ‘Record Date’
December 22, 2005. Our Board of Directors approved the rights issue in the meeting held on August 25,
2005. The equity shares started trading on an ex-right basis from December 15, 2005. The Equity Shares
arising out of the rights issue were allotted on February 17, 2006.
Market price information provided below for period prior to December 15, 2005 have been adjusted for the
issue Equity Shares on a rights basis and therefore prices mentioned below are different from the actual
price at which our Equity Shares were traded or the volume of transaction recorded.
Our Equity Shares are listed on the BSE, NSE and DSE. As our Equity Shares are actively traded on the
BSE and the NSE, our stock market data has been given separately for each of these Stock Exchanges.
There has been no trading in our shares on DSE in the past three years.
BSE
Year High (Rs.) Date of Volume Low (Rs.) Date of Volume Average
ending High on date of Low on date of price for
March 31 high (no. low (no. the year
of shares) of shares) (Rs.)
2004 337 February 19,972 119.21 April 11, 1,244 229.28
20, 2004 2003
2005 785.38 February 8,551 324.08 April 05, 3,166 499.47
15, 2005 2004
2006 2,035 March 21, 1,87,380 761.33 April 5, 8,626 1,429.71
2006 2005
Source: Market Price Information is sourced from Capital Line
NSE
Year High (Rs.) Date of Volume Low (Rs.) Date of Volume Average
ending High on date of Low on date of price for
March 31 high (no. low (no. the year
2004 335.71 February 30,855 119.63 April 11, 6,306 228.90
20, 2004 2003
2005 786.29 February 23,409 325.38 April 05, 7,630 499.46
15, 2005 2004
2006 2,003.5 March 16, 96,054 761.17 April 5, 25,958 1,429.60
2006 2005
The high and low closing prices recorded on the BSE and the NSE and the number of Equity Shares traded
on the days such high and low prices were recorded, during the last six months, are stated below:
BSE
Month, High (Rs.) Date of Volume Low (Rs.) Date of Volume Average
Year High on date of Low on date of price for
high (no. low (no. the month
Page 27 of 144
June 2006 1,607 June 2, 3,578 1,140.75 June 14, 18,749 1,397.62
2006 2006
July 2006 1,347.2 July 3, 675 1,112.4 July 25, 2,125 1,238.55
2006 2006
August 1,674 August 25, 5,424 1,254.2 August 1, 5,104 1,528.57
2006 2006 2006
September 1,922.1 September, 13,444 1,547.3 September 9,459 1,700.20
2006 2006 11, 2006
October 1,904.05 October 2,188 1,747.85 October 3,144 1,826.18
2006 21, 2006 17, 2006
November 2,268.00 November 8,279 1,885.00 November 6,444 2129.46
2006 28, 2006 1, 2006
NSE
Month, High (Rs.) Date of Volume Low (Rs.) Date of Volume Average
Year High on date of Low on date of price for
high (no. low (no. the month
June 2006 1,618.1 June 2, 18,144 1147.1 June 14, 24,443 1,339.7
2006 2006
July 2006 1,339.70 July 3, 2,026 1116.5 July 25, 7,759 1,238.12
2006 2006
August 1,672.05 August 23, 5,421 1254.15 August 1, 9,728 1,528.96
2006 2006 2006
September 1,926.2 September 19,987 1551.7 September 7,424 1,700.85
2006 26, 2006 11, 2006
October 1,905.05 October 7,263 1754.15 October 1,7624 1,826.54
2006 21, 2006 17, 2006
November 2,263.45 November 18,942 1,885.4 November 6,359 2,134.45
2006 28, 2006 1, 2006
There was no trading on the DSE for the last six months.
The market price of our equity shares on BSE on August 25, 2006, the trading day immediately following
the day on which the Board meeting was held to approve the Issue, was Rs. 1,674.00
The market price of our equity shares on NSE on August 25, 2006, the trading day immediately following
the day on which the Board meeting was held to approve the Issue, was Rs. 1,668.30
The market data provided above does not reflect the split of Equity Shares of Rs. 10 each to Rs. 2 each
passed by the Company in its AGM on November 17, 2006.As of December 12, 2006, the Equity Shares of
the Company are being traded on the Stock Exchanges with the face value of Rs. 2 each.
Page 28 of 144
USE OF PROCEEDS
The total proceeds of the Issue will be Rs. 2,599.99 million. After deducting the issue expenses of
approximately Rs. 78.00 million, the net proceeds of the Issue will be approximately Rs. 2,521.99 million.
Purpose of Issue
Subject to compliance with applicable laws and regulations, we intend to use the net proceeds received
from the Issue to accelerate further growth, fund various expansion plans, long-term working capital
requirements, to finance investment opportunities and for general corporate purposes.
In accordance with the policies set up by our Board, the management will have flexibility in deploying the
proceeds received by us from the Issue. Pending utilization for the purpose, described above, we intend to
temporarily invest funds in creditworthy instruments, including money market mutual funds and deposits
with banks and corporates. Such investments would be in accordance with the investment policies approved
by the Board from time to time.
Page 29 of 144
CAPITALIZATION
The following table shows as at June 30, 2006:
• our actual capitalization;

• our adjusted capitalization, to give effect to the issuance of Equity Shares by us in this
Issue at a price of Rs. 415 per Equity Share.
This table should be read in conjunction with our consolidated audited financial statements as of and for the
year ended June 30, 2006, the related notes and “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” and the other financial information contained elsewhere in this
Placement Document.
As at June 30, As adjusted for As adjusted for

2006 the warrants the Issue after
Actual issue adjusting for
the warrants
issue
(Rs. Millions) (Rs. Millions) (Rs. Millions)
Loan Funds
Secured Loans 5,230.92 5,230.92 5,230.92
Unsecured Loans 1,796.57 1,796.57 1,796.57
Total Debt 7,027.49 7,027.49 7,027.49
Shareholders’ funds
Equity Share Capital of par value Rs. 2 each 268.85 268.85 281.38
outstanding *
Warrant / Share Application money 66.48 264.72 264.72
Reserves & surplus 5,010.92 5,010.92 7,598.39
Total Shareholders’ Funds 5,346.24 5,544.49 8,144.49
Total Capitalization 1,2373.73 12,571.98 15,171.98

* The Company has split one Equity Share of Rs. 10 face value into five Equity Shares of Rs. 2 each pursuant to an AGM
resolution dated November 17, 2006..
The Company has issued and allotted 1,212,480 warrants with an option to the warrant holders to acquire,
for every warrant, five fully paid up Equity Share for Rs. 2 each at a price of Rs. 1,635 per warrant
aggregating to a total of Rs. 198,24,04,800 to the Promoter and promoter group on a preferential allotment
basis. The issue of warrants has been approved by the shareholders of the Company in its extraordinary
general meeting held on September 22, 2006. The option to acquire Equity Shares may be exercised by the
warrant holders at any time before the expiry of 18 months from the date of allotment of warrants. If the
warrant holders don’t exercise the option given under the warrants within 18 months, the warrants shall
lapse and the initial amount paid for the warrants shall be forfeited. The warrants shall be subject to a lock-
in period as specified under Chapter XIII of the SEBI Guidelines.
Page 30 of 144
DIVIDEND POLICY
Under the Companies Act, an Indian company pays dividends upon a recommendation by the board of
directors and approval by a majority of the shareholders, who have the right to decrease but not to increase
the amount of the dividend recommended by the board of directors. Under the Companies Act, dividends
may be paid out of profits of a company in the year in which the dividend is declared or out of the
undistributed profits or reserves of previous fiscal years or out of both.
The Company does not have any formal dividend policy. The declaration and payment of dividend will be
recommended by our Board of Directors and approved by our shareholders, at their discretion, and will
depend on a number of factors, including but not limited to our profits, capital requirements and overall
financial condition.
The dividends declared by us on Equity Shares during the last three Fiscal years have been presented
below.
Fiscal 2006 Fiscal 2005 Fiscal 2004

Face value of Equity Shares (Rs. Per share) 10 10 10
Dividend (Rs. in million) 67.21 54.99 28.71
Dividend Tax (Rs. in million) 9.43 7.71 3.75
Dividend per Equity Share (Rs.) 2.50 2.50 1.50
Dividend Rate (%) 25 25 15
The amounts paid as dividends in the past are not necessarily indicative of our dividend policy or dividend
amounts, if any, in the future.
Dividends are payable within 30 days of approval by shareholders at our annual general meeting. The
Articles of Association also give the Board the discretion to declare and pay interim dividends without
shareholder approval at an annual general meeting. When dividends are declared, all the shareholders who
appear in the share register as on the ‘‘record date’’ or “book closure date” are entitled to the dividend
declared by us. Any shareholder, who ceases to be a shareholder prior to the record date or becomes a
shareholder after the record date, will not be entitled to the dividend declared by us.
Currently, we pay a dividend distribution tax of 12.50%, a surcharge of 10.00% on the dividend
distribution tax and an educational cess of 2% on both the tax and the surcharge. These taxes are not
payable by the shareholders nor are they withheld or deducted from the dividend payments set forth above.
For further details, see the section tilted “Taxation”.
Page 31 of 144
SELECTED HISTORICAL FINANCIAL INFORMATION
The selected financial information as of and for the three years ended June 30, 2006 set forth below have
been derived from our audited financial statements included elsewhere in this Placement Document. The
financial information for the years ended June 30,2006 and June 30, 2004 are on consolidated basis while
for the year ended June 30, 2005 , the same are on standalone basis. Hence to that extent the figures are not
comparable. For more details please refer to “Schedule 20-Notes to Accounts”. The financial information
included in this Placement Document does not reflect our results of operations, financial position and cash
flows for the future and our past operating results are no guarantee of our future operating performance.
Our audited financial statements are prepared and presented in accordance with Indian GAAP. For a
summary of our significant accounting policies and the basis of the presentation of our financial statements,
refer to the notes to the audited financial statements included in this Placement Document.
The selected financial and operational data set forth below should be read in conjunction with
“Management's Discussion and Analysis of Financial Condition and Results of Operations” and our audited
financial statements.
BALANCE SHEET
SOURCES OF FUNDS June 30, June 30, June 30,
2006 2005 2004
(Rupees (Rupees (Rupees
Million) Million) Million)
SHAREHOLDERS' FUNDS
Share Capital 268.85 219.98 191.37
Share/Warrant Application Money 66.48 30.00 -
Reserves & Surplus 5,010.92 1,965.28 739.18
5,346.24 2,215.25 930.55
Minority Interest 192.48 - -
LOAN FUNDS:
Secured Loans 5,230.92 2,561.70 2,152.86
10 % Unsecured Fully Convertible Debentures - - 213.55
Unsecured Loans 1,796.57 300.38 0.08
7,027.49 2,862.08 2,366.49
DEFERRED TAX LIABILITY (NET) 273.25 130.44 51.02
TOTAL 12,839.47 5,207.77 3,348.07
APPLICATION OF FUNDS
FIXED ASSETS
Gross Block 4,696.41 2,511.04 1,890.80
Less : Depreciation 602.22 373.63 271.13
Net Block 4,094.20 2,137.42 1,619.67
Capital work-in-progress including advances 909.60 157.92 144.41
GOODWILL (on consolidation) 58.15 - 0.24
Page 32 of 144
INVESTMENTS 416.08 319.16 3.93
CURRENT ASSETS, LOANS & ADVANCES

Inventories 5,813.20 2,759.26 1,575.97
Sundry Debtors 285.45 123.07 176.04
Cash & Bank Balances 387.43 215.00 138.48
Loans & Advances 3,854.16 936.80 409.59
Other Current Assets 10.92 4.61 -
10,351.15 4,038.74 2,300.08
LESS : CURRENT LIABILITIES & PROVISIONS
Current Liabilities 2,654.42 1,264.75 654.64
Provisions 335.87 183.47 69.74
2,990.28 1,448.22 724.38

NET CURRENT ASSETS 7,360.87 2,590.52 1,575.70
MISCELLANEOUS EXPENDITURE 0.56 2.76 4.12

(To the extent not written off or adjusted)
TOTAL 12,839.47 5,207.77 3,348.07
PROFIT AND LOSS ACCOUNT

For the year ended June 30
PARTICULARS 2006 2005 2004
(Rupees (Rupees (Rupees
Million) Million) Million)
INCOME
Sales & Operating Income 19,336.71 10,527.97 6,434.03

Other Income 36.66 30.54 13.28
10,558.51 6,447.31
19,373.36
EXPENDITURE
Cost of goods consumed & sold 12,771.81 7,003.09 4,380.10
Personnel cost 1,225.70 506.54 277.05
Manufacturing & other expenses 3,979.99 2,109.78 1,228.76
Finance Charges 354.20 274.57 231.47
Depreciation 226.97 133.33 95.69
Goodwill written off 1.41 - 0.06
18,560.08 10,027.30 6,213.06
Profit Before Taxation 813.28 531.21 234.25

Less: Earlier year's Income Tax 0.73 0.32 0.75
Less: Provision for Taxation
a) Current Tax 116.64 72.84 14.50
b) Deferred Tax 148.56 70.14 27.97
c) Fringe Benefit Tax 19.78 2.40 -
Profit After Taxation 527.58 385.51 191.03
Add: Share in the Profit of Associates - - 1.48
Share of Minority Interest (9.52) - -
Page 33 of 144
Profit After Minority Interest 537.10 385.51 192.52
Add : Balance brought forward 651.96 380.81 329.48

Available for Appropriation 1,189.07 766.32 522.00
Proposed Dividend 67.21 54.99 28.71

Dividend Tax 9.43 7.71 3.75
Transfer to General Reserve 64.16 38.55 9.89
- 117.13
Brands Set-off -
Balance carried to Balance Sheet 1,048.27 665.06 362.52
766.32 522.00
1,189.07
Earnings Per Share Rs. (Face value Rs.10) Rs. Rs. Rs.
Basic 21.18 16.54 10.16
Diluted 21.18 15.63 9.63
Page 34 of 144
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
You should read the following discussion of our financial condition and results of operations together with
our audited financial statements under Indian GAAP including the schedules, annexure and notes thereto
and the reports thereon, which appear in this Placement Document. The financial information for the years
ended June 30,2006 and June 30, 2004 are on consolidated basis while for the year ended June 30, 2005,
the same are on standalone basis. Hence to that extent the figures are not strictly comparable.
Business Overview
From our beginning in 1987, we have today evolved as one of the leading manufacturer and are among the
entrepreneur driven, professionally managed retailer focused on meeting customer requirements for a large
component of their spend across fashion, food, general merchandise, home in both value and lifestyle
segments. We have also entered into partnerships/joint ventures to expand our offerings from home to
country occupying an aggregate area of 3,165,498 sq ft (as on October 15, 2006).
Our business is identifiable under two major segments (i) Value retailing and (ii) Life Style retailing. We
stores (includes 6 aLL stores, and 4 Blue Sky outlets). In Value Retailing segment, cater to our customers
needs through our 33 Big Bazaar, 48 Food Bazaar Outlets and 9 speciality retail stores (includes 5, Fashion
Station, 3 Depot Store and 1 Health Village Outlet)
We retail a range of branded and Private Label apparel, footwear, perfumes, cosmetics, jewellery, leather
family store, besides garments, we also retail household items, consumer durables and home furnishings
Our loyalty program, called ‘Green Card’ in our format Pantaloons, currently has more than 2,50,000
members as on October 15, 2006. The Green Card programme accounted for more than 50% of our sales in
Pantaloon Stores for the year ended June 30, 2006. We offer our Green Card holders rewards points on
their purchases, special offers and discounts, and invitations to exclusive events and promotions. We also
have a co-branded credit card with ICICI Bank Limited. We have more than 200,000 card holders and are
considered to be one of the largest co-branded credit cards in the country.
We have 14 subsidiaries and six joint venture entities supplementing our business.
Business Performance
Revenue
Our Net Sales and Profit after Tax for the year ended June 30, 2006 was Rs. 19,336.71 million and Rs.
537.10 million respectively as compared to Net Sales and Profit after Tax of Rs 10,527.97 and Rs. 385.51
Page 35 of 144
million respectively for the year ended June 2005. Our sales have grown at a CAGR of 73.36% during the
year 2004 to 2006.
(Rs. Million)
Period ending June 30,2006 June 30,2005 June 30,2004
Sales and Operating Income 19,336.71 10,527.97 6,434.03
% change over Last Year
83.67% 63.63% -
Gross Margins
In retail, it is important to sell more value from the same area (Shelf Space) and earn higher margins from
sales. We can do this by either retailing products that have very high margins, but lower inventory turns,
alternatively buy products, which have very high sell through but contribute to volume expansion at lower
margins..
Most of the time, a retailer uses a combination of aforementioned to increase the Gross Margins. Since our
cost of operations is largely fixed (once a store is opened, there is limited variable cost), maximizing Gross
Margins becomes the key to enhancing profitability.
Gross Margins = (Gross Sales – Cost of Goods Sold)
Our Gross Sales, Cost of Goods Sold (COGS) and Gross Margins for the last 3 years are given below
Rs. Million
Period ending June 30, 2006 June 30,2005 June 30,2004
Gross Sales 19,336.71 10,527.97 6,434.03
Cost of Goods Sold 12,771.81 7,003.09 4,380.10
Gross Margin 6,564.90 3,524.88 2,053.93
Gross Margin as % of Gross Sales 33.95% 33.48% 31.92%
Increase in gross margins is attributable to the fact of increase in operating income which includes Shop-in-
Shop commission and consignment commission. Other operating Income was Rs. 109.84 million, 345.31
million and 1,099.17 million respectively in the years 2004, 2005 and 2006
Business Segments
We operate in two segments viz; Lifestyle retailing and value retailing.
Our segmental breakup of revenues in both these segments is given below;
Sales Mix %
Period ending June 30,2006 June 30,2005 June 30,2004
Value Retailing 12,948.02 5,990.40 3,126.87
Value Retailing as a % of Net Sales 66.96 56.90 48.60
Lifestyle Retailing 5,741.84 3,476.97 2,048.08
31.83
Lifestyle Retailing as a % of Net Sales
29.69 33.03
Others
646.85 1,060.62 1,259.08
Others as a % of Net Sales
3.35 10.07 19.57
Page 36 of 144
Results of Operations
The table below sets forth various line items from our audited financial statements for the years ended
2006, 2005 and 2004.
Year ended 30th June (Rs. Million)
2006 2005 2004
Net Sales( net of excise) 19,336.71 10,527.97 6,434.03
Other income 36.66 30.54 13.28
Cost of Goods Sold 12,771.81 7,003.09 4,380.10
Cost of Goods Sold as a % to Net Sales 66.05% 66.52% 68.08%
EBIDTA 1,395.87 939.11 561.40
EBIDTA as a % to Net Sales 7.22% 8.92% 8.72%
Interest/Finance charges 354.20 274.57 231.47
Interest/Finance charges as a % of Net Sales 1.83% 2.61% 3.60%
Depreciation 228.38 133.33 95.75
Depreciation as a % of Net Sales 1.18% 1.27% 1.49%
Net Profit Before tax 813.28 531.21 234.19
Net Profit Before tax as a % of Net Sales 4.21% 5.05% 3.64%
Net Profit after Tax 537.10 385.51 192.46
Net Profit after Tax as a % of Net Sales 2.78% 3.66% 2.99%
Comparison of year ended 2006 with year ended 2005
Net Sales
Our Net Sales increased by 83.67 % in the year 2006 to Rs. 19,336.71 million as compared to Rs.
10,527.97 million in the year 2005. This was on account of revenues from new stores opened during the
year and from increased sales in existing stores.The Company recorded store growth of 21.58% during the
year.
Other Income
Other income increased by 20% to Rs.36.66 million in the year 2006 from Rs. 30.54 million in the
2005. The increase was primarily due to increase in rental income.
Expenditure
The expenditure (cost of goods consumed , manufacturing cost and employee cost) grew by about 86.89%
relative to a 83.66 % growth in sales to about Rs.17,977.50 million in the year 2006. This was primarily on
account of increase in personnel cost , rent and advertising expenditure.
Earnings before Interest, Depreciation, Tax and Amortisation and exceptional items (EBIDTA)
EBIDTA increased substantially by about 48.64% to Rs.1,395.87 million in the year 2006 over 939.11
million in 2005. This was the direct result of increase in turnover.
Finance Charges
Finance charges increased to Rs.354.20 million in the year 2006 from Rs.274.57 million in the year 2005
representing a 29% increase due to incremental debt.
Depreciation
The depreciation expense on fixed assets increased substantially from Rs. 133.33 million in the year 2005
to Rs. 228.38 million in the year 2006. The increase in depreciation can be attributed to the addition in the
gross block to the tune of Rs.1,363.31 million during the year.
Page 37 of 144
Income tax
We provided for income tax as our profits increased and had a tax charge of about Rs. 284.98 million in
June 2006.
Profit after tax as per Audited statement of Accounts

Our profit after tax, as a percentage of Net Sales was about 2.78% ,our profits have increased to Rs.537.10
million in the year 2006 as against Rs.385.51 million in the prior year, an increase of 39.32% from last
year.
Comparison of year 2005 with year 2004
Net Sales
Our Net Sales increased by 63.63% in the year 2005 to Rs. 10,527.97 million as compared to Rs. 6,434.03
million in the year 2004. This was on account of revenues from new stores opened during the year and
from increased sales in existing stores.
Other Income
Other income increased by Rs. 130.14 % to 30.54 million in the year 2005 as compared to Rs. 13.27
million in the year 2004. The increase was primarily due to profit on sale of our investments in Mark
Middle East LLC and Pantaloon Retail Technologies Limited, increase in the sales of written down
inventory and higher cash discounts availed during the year.
Expenditure
The expenditure (Cost of goods consumed, manufacturing cost and employee cost) grew by about 63.43%
relative to a 63.63% growth in sales to about Rs.9,619.40 million in the year 2005. This was primarily on
account of increase in personnel cost and advertising expenditure.
Earnings before Interest, Depreciation, Tax and Amortisation and exceptional items (EBIDTA)
EBIDTA increased by about 67.28 % to Rs. 939.11 million in the year 2005 over 561.40 million in the
year 2004. The increase is in line with the increase in our sales.
Finance Charges
Finance charges increased to Rs. 274.57 million in the ye 2005 from Rs. 231.47 million in the year 2004
representing a 18.63% increase. This was mainly due to a higher bank borrowing utilization for increase in
working capital needs due to addition of new stores and term loan acquisition for fixed assets.
Depreciation
The depreciation expense on fixed assets increased in value from Rs.95.75 million in the year 2004 to Rs.
133.33 million in the year 2005. This was the result of addition in the gross block during the year to the
tune of Rs 682.02 million.
Income tax
We provided for income tax as our profits increased and had a tax charge of about Rs. 145.38 million for
the year ended June 30, 2005
Profit after tax as per Audited statement of Accounts

Our profit after tax, as a percentage of Net Sales was 3.66% , our profits increased to Rs. 385.51 million in
the year 2005 as against Rs. 192.45 million in the prior year, an increase of 100.31% from last year.
Liquidity and capital resources

Our primary liquidity requirements have been to finance our working capital requirements and our capital
expenditures. To fund these costs, we have relied on cash flows from operations ,working capital limits,
equity capital contributions and long term borrowings and operating leases.
Page 38 of 144
Net Working capital
As of June 30, 2006, our net working capital, defined as difference between (a) current assets, loans and
advance and (b) current liabilities and provisions is Rs.7,360.87 million.
Current Assets, Loans and Advances

Current assets, loans and advances (or Total Current Assets) consist of inventories, sundry debtors, cash
and bank balances and loans and advances. Total Current Assets as of June 30, 2005 and June 30, 2006
were Rs.2590.52 million and Rs. 7,360.87 million, respectively.
The following table sets forth details of our Total Current Assets:
As of June 30,
(amounts in Rs. Million_)
2006 2005 2004
% of % of % of
Total Total Total
Current Current Current
Assets Assets Assets
Inventories........................ 5,813.20 56.16 2,759.26 68.32 1,575.97 68.52
Sundry Debtors (net of
Provisions) .................... 285.45 2.76 123.07 3.05 176.04 7.65
Loans and Advances (net
of provisions) ................ 3,854.16 37.23 936.80 23.20 409.59 17.81
Cash and Bank Balances 387.43 3.74 215.00 5.32 138.48 6.02
Others 10.92 0.10 4.6 0.11 Nil 0
Total Current Assets ...... 10,351.15 100 4,038.74 100 2,300.08 100
Inventory
Inventories, which comprises of raw materials, semi-finished goods, work-in-progress and finished goods
as of June 30, 2004, 2005 and 2006 were valued at Rs. 1,575.97 million, Rs. 2,759.26 million and Rs.
5,813.20 million, respectively. The average inventory holding period was 109.94days, 108.95 days and
108.23 days respectively for the year 2004, 2005 and 2006.
Sundry Debtors
Sundry debtors consist of receivables from customers. In turn, these receivables are divided into those that
have been outstanding for periods up to six months and those that have remained outstanding for over six
months. Receivables that have been outstanding for more than six months are sub-divided into those that
are considered good based on our internal guidelines and those that are considered doubtful. Provisions are
made for all receivables that management has determined are doubtful. The following table presents the
details of our debtors:
As of June 30,
2006 2005 2004
(in Rs. Million, except for percentages)
Amount due from debtors (net of provisions) .............................. 285.45 123.07 176.04
Gross amounts due from debtors outstanding for up to six
months....................................................................................... 201.97 116.63 171.88
Gross amounts due from debtors outstanding for up to
six months as a percentage of debtors (net of
provisions) ................................................................................ 70.75% 94.77% 97.64%
Gross amounts due from debtors outstanding for more
than six months ......................................................................... 89.86 13.57 9.94
Page 39 of 144
As of June 30,
2006 2005 2004
(in Rs. Million, except for percentages)
Gross amounts due from debtors outstanding for more
than six months as a percentage of debtors (net of
provisions) ................................................................................ 31.48% 11.03% 5.65%
Provisions for doubtful debts as at end of the period ................... 6.38 7.13 5.78
Amount of provisions for doubtful debts as a percentage
of debtors (net of provisions) .................................................... 2.24% 5.79% 3.28%
Loans and Advances

Loans and advances consist of unsecured loans and advances that are considered good. These include,
among other items, deposits with landlords for properties taken on lease, customs, port trusts, excise
authorities, advance income tax, export benefits receivables, etc. As of June 30, 2004, 2005 and 2006, loans
and advances totalled Rs 409.58 million, Rs. 936.80 million and Rs.3854.16 million respectively.
Current Liabilities and Provisions
Current liabilities and provisions consist primarily of liabilities to sundry creditors, advances from
customers and liabilities for proposed dividends as well as provisions for dividend payments, wealth taxes,
dividend taxes and income taxes.
The following table presents details of our current liabilities and provisions:
As of June 30,
(amounts in Rs. Million)
2006 2005 2004
% of Total Current % of Current % of
Liabilities Total Liabilities Total
Current & &
Liabilities & Provisions Provisions
Provisions
Current Liabilities:
Sundry Creditors 2,421.87 80.99% 1,088.86 75.19% 563.9 77.85%
Advances from Customers 199.93 6.69% 160.16 11.06% 84.37 11.65%
Interest accrued but not due 11.81 0.39% 9.07 0.63% 0.02 0.00%
Other Current Liabilities 20.80 0.70% 12.76 0.88% 6.35 0.88%
Provisions:
Provision for Taxes 219.49 7.34% 98.24 6.78% 27.17 3.75%
Proposed Dividend (incl. Dividend
tax) 76.64 2.56% 62.71 4.33% 32.46 4.48%
Provision for Leave Encashment /
Gratuity 32.04 1.07% 15.88 1.10% 10.11 1.40%
Other provisions 7.69 0.26% 0.53 0.04%
Total Current Liabilities
& Provisions 2,990.28 100% 1,448.22 100% 724.38 100%
Net Cash Flows

The table below summarizes our cash flows for the years 2004, 2005 and 2006:
Page 40 of 144
For the year ended June 30,
(in Rs. Million)
2006 2005 2004
Net Cash Generated from (Used in) Operating
(2,472.01) 196.99
Activities ...................................................................................... 17.32
Net Cash from (Used in) Investing Activities .............................. (3,692.78) (1,257.83) (724.80)
Net Cash Generated from (Used in) Financing
6,221.46 1,137.37
Activities ...................................................................................... 765.16
Net Increase/(Decrease) in Cash and Cash
56.67 76.53
Equivalents .................................................................................. 57.68
Operating Activities
Cash flow from operating activities primarily depends upon our operating profits and changes in net
working capital. The table below summarizes our cash flow from operations for the years 2004, 2005 and
2006:

(in Rs. Million)
2006 2005 2004
Operating Profits before Working Capital Changes
(net of Tax) ............................................................................... 1,296.20 889.37 537.36
Cash Flow from Exceptional and Extraordinary items................. (0.73) (0.32) (0.75)
Change in net working capital...................................................... (3,767.48) (692.06) (519.29)

Net Cash Generated from Operating Activities....................... (2,472.01) 196.99 17.32
Operating profits before working capital changes (net of tax) increased due to the growth of our operating
income in the year 2006. Cash flow from exceptional and extraordinary items mainly represents outflow
due to earlier year’s tax liability.
Investing Activities
Net cash used in investing activities represents capital expenditure, investments, and income from
dividends and interest. The table below summarizes our net cash used in investing activities for the year
ended 2004, 2005 and 2006:

(in Rs. Million)
2006 2005 2004
Purchase of fixed assets (1,474.49) (668.57) (614.24)
(Increase) / Decrease in capital work - in - progress (712.91) (13.50) (111.18)
Sale of fixed assets 2.87 1.17 0.16
Sale of investments 37.20 64.00 0.52
Purchase of investments (282.33) (318.82) (0.10)
Dividend Income 0.06 0.08 0.05
Advance given (1,263.39) (322.19) -
Net Cash from (Used in) Investing Activities ........................... (3,692.78) (1,257.83) (724.80)
Financing Activities
Net cash from financing activities is determined by the level of principal and interest payout on debts, new
indebtedness and issue of new capital stock and dividend and interest payouts. The table below summarizes
our net cash from investing activities for the years 2004, 2005 and 2006:

Particulars (Rs in Million)
2006 2005 2004
Page 41 of 144
Payment of Dividend and Dividend Tax (62.71) (32.46) (20.51)
Working Capital from Banks/Institutions 882.37 (80.75) 90.67
Conversion of Debentures into equity shares - (213.55) -
Proceeds from Issue of Share Capital 2,674.65 913.55 106.74
Proceeds from Issue of Commercial Paper 250.00 17.50 132.5
Warrant Application money received 66.48 30.00 -
Proceeds from Issue of Unsecured FCDs - - 213.55
Long Term Loans 741.17 481.60 512.08
Proceeds from Other Borrowings 2,041.50 296.04 (38.4)
Rights Issue Expenses (17.79) - -
Interest (Net) (354.21) (274.57) (231.47)
Net Cash Generated from (Used in) Financing
Activities....................................................................................... 6,221.46 1,137.37 765.16
Related Party Disclosures

For details of Related Party Disclosures, please refer to the section entitled “Related Party Disclosures” on
page 138 of this Palcement Document.
Significant Accounting Policies
1.1 Basis of Accounting :

The financial statements have been prepared to comply in all material respects with the mandatory Accounting Standards
issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956. The
financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies
have been consistently applied by the Company and are consistent with those used in the previous year.
1.2 Fixed Assets and Depreciation :

Fixed assets are stated at cost, less accumulated depreciation . Cost comprises the purchase price and any attributable
cost of bringing the asset to its working condition for its intended use. Financing costs relating to acquisition of fixed
assets are also included to the extent they relate to the period till such assets are ready to be put to use.
Depreciation is provided on Straight Line Method as per the rates and in the manner prescribed in Schedule XIV to the
Companies Act, 1956 except employee perquisite- related assets which are depreciated over three years. Depreciation on
the amount capitalised on account of foreign exchange fluctuation is provided prospectively over the residual life of the
assets.
1.21 Goodwill on Consolidation

The excess of cost to the Parent Company of its investment in subsidiaries over the Parent Company’s portion of equity
in the subsidiaries at the respective dates, on which investments in subsidiaries were made, is recognized in the
consolidated financial statements as goodwill. The Parent Company’s portion of equity in the subsidiaries is determined
on the basis of the book value of assets and liabilities as per the financial statements of the subsidiaries as on the date of
investment. The Goodwill recorded in these consolidated financial statements will be written off 5 years from the year of
acquisition.
1.22 Leased Fixed Assets

Lease payments under operating lease are recognised as expense as per the tenure of the lease agreements.
Assets taken on finance lease (including that prior to 1st April 2001) are capitalised and finance charges are charged to
Profit & Loss account on accrual basis.
1.3 Borrowing Cost:

Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are
capitalized as part of the cost of that asset up to the date the assets are ready for their intended use or sale. Other expenses
are recognized as an expense in the period in which they are incurred.
1.4 Investments :
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Long-term investments are stated at cost. Provision for diminution is being made if necessary to recognise a decline,
other than temporary in the value thereof.
Current Investments are stated at the lower of cost and market / fair value.
Inventories :
Inventories are valued as follows :
a) Stores, Spare parts, Packing material, and Branding Material : At cost
b) Raw material & Stitching material : At cost
c) Finished goods lying at the stores : At the retail price less mark up
d) Work in Progress and Finished goods lying in the factory : At the lower of cost or net realisable
value.
In case of finished goods, cost includes material cost and direct production overheads.
1.6 Transactions in Foreign Currency :

Foreign currency transactions are accounted at the rates prevailing on the date of transaction.Year-end current assets and
liabilities are translated at the exchange rate ruling on the date of the Balance Sheet.
Exchange differences on settlement / conversion are adjusted to :
Cost of fixed assets, if the foreign currency transaction relates to fixed assets.
Profit and Loss Account, in other cases.
Wherever forward contracts are entered into, the exchange differences are dealt with in the Profit and Loss
Account over the period of the contracts.
1.7 Revenue Recognition :

Sale of Goods are accounted on delivery to customers. Sales is net of returns and discounts. Sales tax/ Value Added Tax
is reduced from sales. Export sales is accounted as revenue on the basis of Bill of Lading. Interest income is recognised
on accrual basis. Dividend income is accounted for when the right to receive is established. Claims are accounted only
when there is reasonable certainty of its ultimate collection.
1.8 Miscellaneous Expenditure :
Right Issue Expenses are adjusted to Share Premium Account and Preliminary expenses are charged to Profit & Loss
Account as incurred.
1.9 Retirement Benefits :

In respect of benefits like Gratuity and Leave encashment ,the provision is accrued and provided for on the basis of
actuarial valuation at the end of every Financial Year
1.10 Taxation :
a) The deferred tax for timing differences between the book and tax profits for the period is accounted for using the tax
rates and laws that have been substantially enacted as on the balance sheet date. Deferred tax assets are recognized only
to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such
deferred tax assets can be realized. Deferred tax assets are recognized on carry forward of unabsorbed depreciation and
tax losses only if there is virtual certainty that such deferred tax assets can be realized against future taxable profits.
b) Provision for Current Tax is made on the basis of taxable profits computed for the current accounting period
(reporting period) in accordance with the Income Tax Act, 1961.
1.11 Premium on Prepayment of Term Loans :

Premium paid on prepayment of Term Loans is amortised over the unexpired tenure of the said Term Loan.
1.12 Provisions, Contingent Liabilities and Assets

Provisions are recognised when the company has a present obligation as a result of past events and it is more likely than
not that an outflow of resource will be required to settle the obligation and the amount has been reliably estimated.
1.13 Impairment of Assets

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is
Page 43 of 144
charged to Profit & Loss Account in the year in which the asset is impaired and the impairment loss recognised in prior
accounting periods is reversed if there has been a change in the estimate of recoverable amount. For the purpose of
assessing impairment, assets are grouped at the lowest level of cash generating units.
Page 44 of 144
INDUSTRY
The information presented in this section has been extracted from publicly available documents from
various sources, including officially prepared materials from the Government, its various ministries
various research agencies and has not been prepared or independently verified by the Issuer or the Lead
Managers
Industry Overview
Retailing is the world’s largest private industry
Retail is the world’s largest private industry with global retail sales of roughly USD 8 trillion. Retailing is
also one of the biggest contributors to the Gross Domestic Product (GDP) of most countries and also one of
the biggest employers. (Source CII McKinsey Report titled “Retailing in India, the Emerging Revolution”)
In India, however, the retail sector has seen a high level of fragmentation with a large share held by
unorganised players.
Indian Retail Industry
India is the 4th largest economy in the world in Purchasing Power Parity (PPP) terms after USA, China and
Japan. In 2003, India became the second fastest growing economy in the world with a growth rate of 8.2%.
The economy is expected to grow at 7-8% per annum for the next 5 years. However the average income of
an Indian evaluated on the basis of GDP per capita is a meagre $620 (Rs27900). On this measure India
figures a lowly 127 in a committee of 177 nations in the Human Development Report (HDR) 2005
produced by United Nations Development Programme (UNDP).On the other extreme, India has one of the
highest savings rate in the world with Rs 29 of every Rs 100 of its national income being saved. These
extremities leaves a lot of opportunity for marketers, both Indian and international. One of the key growth
factors has been the shift to service sector which accounts for 50% of the total GDP. Led by services such
as IT, telecommunication, healthcare and retailing, the services sector is likely to play an even more
important role in the Indian economy.
Retailing in India is one of the significant contributors to the India economy and accounts for 35% of the
GDP. India has a large number of retail enterprises. With close to 12 million retail outlets India has one of
the highest retail densities in the world, but only 4% being larger than 500 sq ft in size. In terms of the
structure, the industry is fragmented and predominantly consists of independent, owner-managed shops.
The retail businesses include a variety of traditional retail formats, such as "kirana" stores which stock
basic household necessities (including food products), street markets-regular markets held at fixed centres
retailing food and general merchandise items, street vendors-mobile retailers essentially selling perishable
food items-fruits, vegetables etc and small non specialized retailers.
Traditional retail formats

Format Definition Value position India examples
Counter stores Food: Family run stores, selling High service, Kirana stores
essentially food items Low price
Kiosks Pavement stalls selling limited variety High service Paan shops
of food and beverages
Street markets Regular markets held at fixed centre Large selection, Village haats
retailing food and general merchandise Low price
items
Street vendors Mobile retailers essentially selling High service Vegetable vendors
perishable food items - fruits,
vegetables, milk, eggs, etc.
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Migration from unorganized to organized retail has been visible with economic development, in most
economies.
Economic development drives channel modernisation
100
(%)
Taiwan US
through modern retailers
80 Argentina
Grocery turnover
60
Brazil
Malaysia
40 Thailand Israel
China
20
Indonesia
0 India
0 5,000 10,000 15,000 20,000 25,000 30,000 35,000
GDP/capita (PPP)
Source: CII McKinsey Report titled “Retailing in India, the Emerging Revolution’
In Thailand, there has been an explosion in the growth of organized retail, with over 40 % of the trade
moving to modern formats within 10 years. The easy entry of foreign retailers and the geographic
concentration of the retail industry facilitated this growth. In Poland, where modern retail has captured 20%
of the market in the last 9 years, ease of real estate access, a level playing field between modern and
traditional retailers, and ease of entry for foreign retailers contributed to the growth. (Source: CII
McKinsey Report titled “Retailing in India, the Emerging Revolution’)
Growth of Organized Retail
50% 16
Years
% Share
40%
12 % Share of Large
Format Retailers of
30% Market
8
No. of years taken
20%
4
10%
0% 0
Thailand Brazil Poland China India
Source: KSA Technopak
Trends in Consumer Spend in India
Growth in consumption
The changes in demographics are driving changes in consumption pattern in the country. According to
Central Statistical Organisation (CSO) private final consumption of consumers in India was over
Rs.17,600 billion in FY04.
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Urban consumer’s shopping basket is changing
Within the overall private final consumption expenditure there are category shifts happening in urban
consumption pattern. A study by KSA Technopak shows that urban consumers have increased their
expenditure on eating out, movies and theatre, books and music, clothing and personal care items even as
they have reduced savings and investments. Consumption has been given a further boost by a significant
increase in offtake of personal credit from an estimated Rs. 500 bn in 2000 to about Rs 1,600 billion in
2003 (source: KSA Technopak).
Consumer Shopping Basket (%)

Categories 1999 2000 2001 2002 2003
Home textile 1.0 1.0 1.5 1.4 1.6
Saving & Investment 14.0 6.1 6.4 5.2 4.1
Clothing 5.0 6.5 4.6 6.6 7.0
Home appliances and Consumer durables 9.0 5.5 7.5 5.0 6.6
Vacation 4.0 3.3 3.1 3.4 3.9
Eating out 8.0 7.9 8.8 12.2 10.8
Footwear 1.0 2.0 2.2 2.5 2.3
Movies & Theatre 1.0 2.7 2.6 3.8 4.6
Entertainment 3.0 3.0 3.0 3.0 2.1
Books & Music 5.0 7.8 6.5 6.7 7.6
Grocery 43.0 47.8 48.0 42.1 41.1
Personal care items 6.0 7.5 7.1 8.8 7.6
Historically, cultural factors have kept Indians highly disposed towards savings. However, increasing
media exposure and a large influx of consumer brands are driving consumer aspiration levels higher, and
enabling a shift in consumer spending habits.
An analysis of private final consumption expenditure in India suggests that the food, beverages and tobacco
segments constitute about 50% of total household expenditure, with clothing and footwear contributing just
around 5%. However contribution of food and groceries to organized retailing is just 14%.
There are a large variety of retailers operating in the food retailing sector such as independent grocers, fair
price shops, food specialists etc. These traditional types of retailers, who operate small single outlet
businesses mainly using family labour, dominate this sector. This is because of the competitive strengths
that traditional retailers possess. These include low operating costs and overheads, low margins, proximity
to customers, long operating hours and additional services to customers such as home delivery. Food
retailing in India also entails supply-chain complexities, given the country’s lack of investment in cold
storage, canalization of agricultural output, and the low level of participation of the organized private sector
in agricultural production.
However we believe that a greater number of higher income Indians, prefer to shop at supermarkets
because of convenience, range of merchandise, higher standards of hygiene and the attractive ambience.
Among the segments of organized retail, food retail is expected to develop the fastest. Going forward, it is
expected that supermarkets will be the fastest growing food retailers.
Like food and clothing, footwear retailing is also characterized by many traditional outlets that are small
and cramped with little emphasis on alluring displays. They basically stock a limited range of cheap and
popular items. We believe the traditional Indian consumer who is now becoming more fashion and brand
conscious welcome more sophisticated outlets retailing footwear which is evident from the fact that the
consumer spend on footwear has increased from 1% in 1999 to 2.3% in 2003.
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With growth in incomes, Indians have been spending more on health and beauty products. As in the case of
other retailing sectors, small single-outlet retailers also dominate sales of health and beauty products.
However, in recent years, retail chains specializing in health and beauty products have gained importance
as the share of consumer spending in this area is increasing substantially.
The home furniture and household goods retailing sector in India is dominated by small retailers. Despite
the large size of this market, very few modern and large retailers have established specialized stores for
these products. This offers a considerable potential for the entry or expansion of specialised retail chains.
Another interesting trend that is emerging is the increasing spend on leisure and entertainement. Indian
consumers who were traditionally averse to spending money on entertainment have started spending on
eating out, movies and theatre. There are specialised retailers for each category of products in this sector. A
few retail chains also emerged particularly in the retailing of books and music products. Another key
feature of this sector is the popularity of franchising arrangements between established manufacturers and
retailers.
The entry of a large number of foreign consumer durable companies into the Indian market during the
1990s after the government liberalised its foreign investment and import policies transformed the consumer
durable sector dramatically. A much larger variety of consumer electronic items and household appliances
became available to the Indian customer. Competition among companies to sell their brands provided a
strong impetus to the growth for retailers operating in this sector.
We believe all these factors have compelled the retailers to evolve new retail formats which can offer
customers a vide variety of products across various categories of their consupmtion basket to enhance
their share in the consumer wallet.
Growth of Organized Retail in India

India is expected to show similar trends as Indian consumers in the past have shown an ability to leapfrog
evolution cycles as has happened in the case of various consumer products such as mobile phones.
As per estimates, retail spending in India in fiscal 2005 stood at Rs. 9,990 billion, of which the organized
sector accounts for Rs. 349 billion, or approximately 3.5%. The size of the organized sector is expected to
grow at 25-30% p.a., reaching Rs. 1,095 billion in 2010.
Phases of Mall Development
The concept of Mall has come up in the early 1990’s. India entered the ‘infancy stage’ in 1990’s when the
first wave of mall deveopment was observed in the form of Spencer Plaza in Chennai, Crossroads in
Mumbai, and Ansal Plaza in New Delhi. Each of these malls was able to leverage a first movers advantage
in its respective market by offering consumers an unprecedented mix of shopping, food and leisure
popularized in USA. India and China are currently in the ‘development’ phase marked by rapid pace of
creation of reatil infrastructure. Mall deveopment in both these countries is trickling down to smaller cities
and towns. In India tierI and tierII cities have seen a sudden spurt in the development of Mall. During the
1990’s South-East Asia and the Middle East had seen a similar rise. US and the UK have reached a
declining stage in Mall development. These countries are undergoing a consolidation phase.
Page 48 of 144
Infancy Development Maturity Decline
Bangladesh South East Asia,

Sri Lanka Middle East
China, India USA, UK
Phase I Phase II Phase III Phase IV
Drivers of Growth in Organized Retailing
We believe that India is experiencing certain socio-demographic changes which are furthering the growth
in organized retail while enablers such as availability of quality real estate are hastening the pace of this
transformation.
Rising income levels

We believe that increase in household income has led to a substantial change in the profile of the Indian
consumer self indulgent consumption patterns. The traditional bottom- heavy triangle where we witness a
large number of people in the lower income group and a few at the top is a trend of the past. But this trend
has been changing over the years. Changes are seen both in the rural and urban areas. The chart below
clearly indicates the same.
Page 49 of 144
Income Distribution among households in per
cent
100%
80% High
Upper-middle
60%
Middle
40%
Lower-middle
20% Lower-middle
0%
1998-99 2006-07 1998-99 2006-07
Rural Urban
Source: NCAER, 2006-07 estimated
Young population with high disposable income

The demographic and psychographic changes relating to Indian consumer class is also driving the India
retail story. With 65% of the population below the age of 35 years, the young generation has grown up free
from ‘shortages ‘ and ‘self denial’ experienced by earlier generations. It is expected that within a decade,
the number of people in the age group 20-49 would increase by 30% - from 395 million in 2000 to 510
million in 2010. (Source: KSA Technopak)
The brand-conscious young population forms the largest segment of demand for the majority of retailers.
For a country like India with large young working population and with a very low burden of dependents,
and a large section of population waiting to enter the work force, the household incomes are bound to rise.
The higher income levels would lead to higher savings and eventually increase the purchasing power.
Availability of brands and merchandise

Consumerism and brand proliferation has been another enabler for organised retailing in India. Most of the
world’s leading brands are now present in India. Some of the well-known names that have set-up their
operations in the country are:-
Category Foreign Brands/ Retailers present in India

Foods & Beverages McDonald’s, Domino’s Pizza, Subway, Pizza Hut, Ruby Tuesday, TGIF, KFC,
Debonair’s Pizza, Movenpick Foods, Baskin Robbins, Mark Pi, Nescafe,
Cookieman
Apparel Tommy Hilfiger, Mamgo, Marks & Spencer, Ermenegildo Zegna, Lacoste, Lee
Cooper, Levi’s Pepe, Benetton, Wrangler, Morgan
Durables Sony, Philips, LG, Samsung, Electrolux, Nokia, Haier, Motorola
Sporting Goods Nike, Adidas, Reebok, Royal Sporting House, Bata, Florsheim
Luxury LVMH, Bvlgari, Cartier, Omega, Hugo Boss,Tiffany’s, Tissot, Raymond Veil,
Baume & Mercier, Mont Blanc, swatch
Consumer Goods Nestle, Coca-Cola, Pepsi, Heinz, Cadbury’s Unilever
Source:- KSA Technopak
Media Proliferation
Another factor that accelerated the concept of organised retail is media proliferation. The resultant exposure
to advertisements and brand promotions across product categories has led to a growing consumer spending
across a wide range of product categories. Organised retailers have been spending heavily on media to
Page 50 of 144
increase brand awareness and to expand the market share. However the media spending in India continues
comparatively very low to the other developed economies.
Outdoor media
Country Spends* ($trillion) As a % of Total Media Spread
US 6,250 3.5
China 796 2.2
India 159 5.0
*Estimates for 2005
Source: The Marketing Whitebook 2006
Availability of quality real estate

Availability of quality real estate has been one of the main constraints for development of organized retail
in India. In the past, negative yield on leased property, lack of bank funding and the unorganized property
market resulted in dearth of quality retail space in the country. The spread between yield on property and
the financing cost has turned positive with the fall in interest rates. Attractive yields on investments have
resulted in sharp increase in property development. Malls across the globe are getting bigger. Malls are
becoming bigger because they are now being positioned as a one stop shop for shopping, entertainment,
leisure and eating out needs rather than a place only for shopping for fashion products.
In addition, the various States governments have taken proactive steps to release large tracts of land for
commercial development. Growth of property funds and permission for Real Estate Investment Trusts
(REITs) to be set up will further help create a secondary market for real estate in the country. Profitable
mall space is not evenly distributed across the country. Table below gives the mall distribution expectation
across the country.
Mall Space Distribution Expectations
Others, 26
Delhi, 30
Pune, 5
Bangalore,
5
Hyderabad, Mumbai, 27
7
All figures in per cent

Enhanced Funding Options

Supply side changes such as consumer finance help in shaping a markets buying power. Consumer credit,
especially through credit cards, has been growing healthily year on year. There were nearly 14 million
credit cards in March 2005, up from a mere 3.73 million in 2000. The most impressive rise has been
recorded over the past years (2002-05), with a 38 percent year- on- year growth. According to a survey
conducted by the National Council of Applied Economic Research (NCAER), there are currently 81
million people who have the potential to be credit card holders. India compared to other developed
countries have very low credit card density.
Country Number of cards 1,000 people (2005)

US 2,793
Canada 2,482
UK 1,529
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Germany 1,297
France 567
India 14
Implementation of VAT to reduce cost and complexity

Differential sales tax rates across states and the incidence of multi point local levies added to costs and
complexity, and has hampered aggregation of sourcing. The implementation of Value Added Tax (VAT) is
also expected to narrow down the cost advantage that unorganized retailers enjoy over the organized ones.
Inbound tourists, shopping

There is a large NRI population. Given that international lifestyle brands are readily available in their
country of migration, this population shops for similar quality merchandise at lower prices in India on their
visits here. Additionally, inbound tourists visiting India and shopping here seek similar products at lower
costs in a similar environment.
Impact of globalisation
Globalisation has removed trade barriers and promoted consumerism. Over the last decade, there has been
an increase in branded goods – both domestic and international – in the Indian market across product
categories. Both width and depth of product offering to the Indian consumers is increasing.
Composition of Organised Retail

A break-up of sales in organized retail shows Lifestyle (clothing and textile, footwear, home, watches and
jewellery and health and beauty) as the largest segment accounting for 73% in value terms. This is followed
by food and grocery accounting for 14% of the organized retail value.
Break-up of consumer’s expenditure in organized retail
The organized Retailing Pie 2005-06
Books, music &

Jew ellery
gifts
w atches
3% Mobile handsets
7%
3%
Catering services
7% Others
4%
Furniture &
furnishings
8%
Footw ear Clothing & textiles

9% 39%
Consumer
durables Food & grocery
9% 11%
Source KSA Technopak Research
Rapid growth of organized retailing is expected in the food segment. We believe this can be attributed to
the highly unorganized nature of the market currently, which thus presents an attractive potential, and the
growing preference of consumers to shop at modern retail formats. Clothing is the other segment expected
to show high growth potential.
Challenges for organised retail
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Availability of skilled manpower: The non availability of trained manpower, especially at the management
level, poses a key risk for the retail sector. With growing opportunities in the emerging service sectors, the
ability of the retail business to hire and retain quality people is under pressure.
Further, as organized retail grows rapidly, there will be pressure on existing players as new entrants look
for trained manpower at various levels.
Supply chain issues: Supply Chain Management efficiencies are essential to retailers to maintain and
improve margins. SCM includes vendor management and logistics management. Vendor selection is an
important outcome of the sourcing process and a key to most efficient sourcing. Logistics management
aims to get the goods from the vendor to the store in the shortest possible time thereby avoiding
unnecessary stocking of goods. In India, both vendor management and logistics management are still
underdeveloped. However, with growing size of operations, supply chain efficiencies will become a key
differentiator of profitability in retail.
Similarly, supply chain tools and techniques are still developing in India with the increase in organised
retailing and entry of international brands. Bar coding is now being implemented, driven by the retailers for
whom it is an essential ingredient for supply chain management.
Category wise status of supply chain

Ready to go
Customer Dry grocery Electronics
willingness/ Men’s apparel
Fast Furnishing Music &
need food Sports clothing Books
Fresh
grocery
Fuel Women’s
apparel
DIY
Liquor
Pharmacy
Toys
Photo
Shape/adapt
Supply chain
sophistication
Source: CII McKinsey Report titled “Retailing in India, the Emerging Revolution”
Modern Retail Formats
Some of the modern retail formats and their value positions are given below.
Format Definition Value Position
Department Stores Multiple product categories, usually Service and choice

lifestyle driven with apparel/ accessories
dominating
Supermarket/Convenience Food and household products Convenience
stores
Hypermarkets/Discount Large stores in big box format, with Price and choice
Stores volume based discounted prices
Page 53 of 144
Specialty Stores/Category Extensive range of products under a Service
Killers single category
Seamless Mall Apparel, Accessories, Lifestyle products, Convenience, service and
Entertainment choice
Department stores
These large stores retail primarily non-food items such as apparel, footwear, accessories, cosmetics and
household products. They stock multiple brands across product categories, though some of them focus on
their own store label (on the lines of Marks & Spencer and St. Michael). These stores are found on high
streets and as Anchors Tenants of shopping malls.
Several local department store chains have opened shop in India in the past five years. We believe the
convenience factor coupled with the aspirational perception of shopping in a department store has
contributed to their growth. The larger chains of department stores (Namely Pantaloons’, Shoppers’ Stop,
Westside, and Lifestyle) have presence in the metros and mini metros.
Supermarkets
A supermarket is a store which is more of a large self-service grocery store selling groceries and dairy
products and household goods that are consumed regularly. These are neighbourhood stores offering home
and personal care products and food products that a typical household consumes on a day to day basis.
These stores are often part of a chain that owns or controls (sometimes by franchise) other supermarkets
located in the same or other towns; increasing the opportunities for economies of scale.
These stores offer convenience of shopping by making available a large variety of products at one place.
Some of the well known supermarket chain includes Food Bazaar, Nilgiris, Food World, Apna Bazaar,
Trinethra, etc.
Hypermarkets/Discount stores
A hypermarket is a store which combines a supermarket and a department store. The result is a retail
facility which carries an enormous range of products under one roof, including full lines of fresh groceries
and apparel. It is a large format store that aims at retail consolidation by being a single point contact
between the brand owners and customers. They are planned, constructed, and executed in a manner that a
consumer can ideally satisfy all of their routine weekly shopping needs in one trip to the hypermarket.
Large variety of products are available at reasonable prices with discounts built in for volume purchased.
This is possible because of economies of large scale operations. Big Bazaar, Spencers and Star India
Bazaar are examples of hypermarket formats.
Seamless Mall
Seamless mall is a format which is relatively new in India. In this format, various brands operate their retail
areas without any wall between them, providing a seamless shopping experience. This makes it possible for
shoppers to compare brands with ease while they shop. We believe this also means that the store can
reallocate space more easily based on merchandise/brand performance and customer feedback. Besides
offering apparels, accessories and lifestyle products these malls are also equipped with entertainment and
leisure facilities. Central is an example of a seamless mall.
Speciality stores
Speciality stores as the name suggests are stores that specialises in a particular offering. A specialty store
carries a deep assortment within a narrow line of goods. Furniture stores, florists, sporting-goods stores,
and bookstores are all specialty stores. Examples of speciality stores in India would include Planet Sports,
aLL, Vijay Sales, Planet M, Musicworld, Crossword, etc.
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BUSINESS
The financial information used in this section is derived from our consolidated and audited financial
statements under Indian GAAP. Financial information providing the break-up of our sales of various
business groups is on the basis of internal management reports and such information is not based on
audited financial statements.
Overview
From our beginning in 1987, we have today evolved as one of the leading retailer and are among the
entrepreneur driven, professionally managed retailer focused on meeting the customer requirements for a
large component of their spend across fashion, food, general merchandise, home in both value and lifestyle
segments. We have also entered into partnerships/joint ventures to expand our offerings from home to
country occupying an aggregate area of 3,165,498 sq ft (as on October 15, 2006). .
Our business is identifiable under two major segments (i) Value retailing and (ii) Life Style retailing. We
stores (includes six aLL stores, and four Blue Sky outlets). In Value Retailing segment, we cater to our
customers needs through our 33 Big Bazaar, 48 Food Bazaar Outlets and nine speciality retail stores
(includes five Fashion Station, three Depot Store and one Health Village Outlet).
We believe that managing customer expectation by offering them all the requirements for their entire
family under one roof is the key to being a successful retailer, and hence have built our business model
around ‘family focus’ rather than ‘individual focus’. We believe addressing the family attracts more
customers into the store.
We retail a range of branded and Private Label apparel, footwear, perfumes, cosmetics, jewellery, leather
family store, besides garments, we also retail household items, consumer durables and home furnishings
Our exclusive formats include;

1. Pantaloons : Lifestyle products under Private Labels and third party brands;
2. Central: Seamless mall providing the customer with a wide range of lifestyle products across
multiple national and international brands;
3. Big Bazaar: Value retailing with a range of products from apparel, toys, accessories,
consumer durables to household products and furnishing; and
4. Food Bazaar: Food and personal care products including dry groceries and FMCG products.
We believe our offerings provide to our customers a unique shopping experience, comprising of a vast
range of lifestyle and value retail products, mix of retailing formats coupled with the facility of
entertainment and leisure.
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Our loyalty program, called ‘Green Card’ in our format Pantaloons, currently has more than 2,50,000
members as on October 15, 2006. The Green Card programme accounted for more than 50% of our sales in
Pantaloon stores for the year ended June 30, 2006. We offer our Green Card holders rewards points on their
purchases, special offers and discounts, and invitations to exclusive events and promotions. We also have a
co-branded credit card with ICICI Bank Limited. We have more than 200,000 card holders and are one of
the largest co-branded credit cards in the country.
We have fourteen subsidiaries and 6 joint venture entities supplementing our business.
Our Competitive Strengths
The following are our key strengths, which we believe, enable us to compete in our business:
Brand equity and early mover advantage

We are one of India’s leading retailers with presence across multiple formats and stores across large and
medium cities across India. We successfully introduced our lifestyle fashion format through ‘Pantaloons’,
hypermarket format through ‘Big Bazaar’, introduced the concept of seamless malls through ‘Central’,
launched ‘Fashion Station’ to offer fashion apparel and accessories to mass market buyers in a theme based
style, opened ‘aLL’ an exclusive lifestyle store for plus size people and continue to invest in new concepts
and formats to capture a greater share of the consumer wallet, either directly and through our strategic
investments. In recognition of popularity of our formats, Big Bazaar was awarded the ‘CNBC TV 18
Awaaz Consumer Award 2006’ in the retail category as the most preferred, large, food and grocery store.
Entrepreneur led, professionally managed by an experienced team

We have an experienced professional management team led by our Promoter Kishore Biyani, who is one of
the leading entrepreneurs in the retail sector in the country and has received various awards over the years,
with the recent one being the Retail Face of the Year, 2005 (Images Retail Awards 2005). Several of our
management team members have experience of managing other retail / consumer facing organisations. The
management team have thus been able to complement rapid expansion with the ability to create adequate
systems and processes.
The management team is complemented by a committed work force. Our Human Resources policies aim to
create an engaged and motivated work force, which is essential for success in any service oriented industry
such as ours.
Project execution and operations capabilities

We have created a project team which enables us to roll out new stores quickly and seamlessly. This has
allowed us to grow from 561,000 Sq. ft. in 2003 to 3,165,498 (as on October 15, 2006) Sq. ft Our
operations team facilitates new stores to be opened quickly and integrated into our system and provide our
customers with the similar experience across all our stores, and also enables our stores to quickly scale up
to meet growing customer requirements.
Vast range of lifestyle and value retail products and services

Our merchandise ranges across apparel, accessories, food products, home and kitchen products, dry and
fresh groceries, consumer durables and non durables with over 2,50,000 SKUs, which are complemented
by our services offerings. Presence in both Lifestyle and Value retailing enables us to cater to a large
segment of the population, besides benefiting from the economies of scale. We offer our customers a
variety of national and international brands as well as our Private Label/brands under one roof.
Strong focus on systems and processes

We have robust systems and processes in place, developed, implemented and tested over a period of time.
We are in the process of implementing SAP ERP System. Our first phase of ‘IS Retail’ module of SAP has
been implemented. Various other SAP modules such as ‘HRMS’, ‘MAP’, ‘BIW’, project management
system are in various phase of implementation. Existing business applications handle all store operations
such as billing, customer loyalty programmes etc. All the locations are connected through company-wide
Virtual Private Network (“VPN”).
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We believe this will help us as we embark on our growth strategy and enhance our reach with our
customers and help us provide them a consistent brand experience across our stores.
Strong distribution and logistics network and supply chain

We have created a strong distribution and logistics network, with our 21 Distribution Centres covering
700,000 sq. ft, handling over 250,000 SKUs.
The distribution and logistics set up is networked and are on line allowing us to deliver merchandise to the
store within 24 hours of receipt / generation of auto replenishment order, which has helped us optimize in-
store availability of merchandise. We believe our existing Distribution Centres, which have been designed
to scale up, will be able to meet our growth requirements as we expand the number of our stores.
The above initiatives have helped us in improving the efficiencies of our supply chain, which we believe is
critical for any retailer. These aim at meeting the conflicting requirements of reducing our inventory whilst
ensuring availability of products at all stores as per customer needs, as well as reducing our operational
costs.
Large base of customers

We had 80,478,520 customer entries in our stores in the year ended June 30, 2006, We believe that the
emotional connect that we have been able to create with our customers through our service offering and
special promotions has helped us convert many of them into loyal customers.
We had around 2,50,000 members of our loyalty programme ‘Green card’ in our format Pantaloon as on
October 15 ,2006. The Green Card programme contributed to more than 50% of our sales of Pantaloon
Stores in the year 2006.
Our Strategy
We intend to maintain and enhance our position as a leading retail entity through continued focus on the
Indian market and investing further in our competitive strengths to grow our business. The key elements of
our business strategy include:
Everything, Everywhere, Everytime to Every Indian Consumer

We intend to provide every consumer, everything they want wherever they want. This essentially means to
capture every segment of market all across India by providing goods and services they need through
various delivery formats (store formats). We endeavour to capture share of every products and services
bought by them in all markets for every segment of the society. We continue to develop and design, source
and innovate new products and services. We will continue to develop or create formats to deliver the goods
to every consumer segment.
Penetration in Key Markets

Increasing our penetration in existing cities with a larger number of stores, increasingly of larger size, will
enable us to penetrate into new catchment areas within these cities and optimize our infrastructure.
Enhancing our reach to cover additional cities will enable us to reach out to a larger population.
We intend to enhance the penetration into the key urban markets apart from rolling out new stores in tier-II
and tier-III cities. We already have multiple stores of the same format in key cities such as Mumbai,
Bangalore, Kolkata, Hyderabad, Chennai, Ahmedabad, Pune and National Capital Region (NCR). We
intend to open more number of outlets in these cities in every locality to achieve scale at city level for every
store format. This will give us opportunity to leverage the common back-end resources at optimum level.
Share of consumer spend

We intend enhancing our share of the consumers’ spend by launching new formats or adding categories to
our existing product range. We will be offering product and services to consumers in all product categories.
We already started offering at our own or through our joint venture partners or subsidiary companies
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product categories such as fashion, food and grocery, general merchandise, home goods, furniture,
consumer durables and electronics, communication, health, beauty and wellness, entertainment and leisure.
We will also intend to offer host of other services including financial products, insurance, health, beauty
and fitness services etc. The objective is to capture the maximum share of consumers’ consumption basket.
This will help us to grow our business as on sustainable basis as consumers spend will increase along with
increase in their income.
Property supply pipeline

We need to source the properties for opening new stores. To maintain the pace of growth we need constant
supply of real estate availability for opening new stores. To achieve this we have four zonal teams who are
entrusted with the responsibility of sourcing the retail space across the country. In addition, we have a
separate Property Division, which takes on malls on lease.
Private Labels and own brands

We continuously focus on enhancing the depth and width of our merchandise offering. Our Private Label
and brands initiative is part of such focus and offers us a differentiating factor as compared to our
competition and at the same time helps us enhance margins.
Our brands help us to offer better value proposition to the customers as well opportunity to buy aspirational
products. We intend to make our private labels as mass product brands
Strategic Relationships
We enter into strategic relationships with joint venture partners to capture higher share of consumer spend
as well to offer goods and services which will otherwise be difficult for us to offer to the consumer. We
enter into strategic relationship with our supply partners to give them access to our front end and effectively
leverage their back end manufacturing facilities to provide greater value to our customers. This helps us to
expedite the launch of new concepts, products or formats faster to the market.
Learning and caring organisation

We aim at recruiting the best talent available in a cross section of industries, identifying fresh talent,
grounding them in our value system and providing opportunities for growth. We have created organisation
which is in constant learning mode as we launch new format or concepts to capture the learning of each
business or category. The human capital management process in the organisation gives the employees
opportunity to experiment, innovate and adapt new things, conducive environment to grow professionally
as well as personally. The various HR programme and activities give them opportunity for on the job
training, enrol for higher studies through correspondence courses, in house training programmes to sharpen
their skills and cross functional career movement. We have tie-ups with various educational institutions to
develop retailing talent through retailing management programme and courses.
Robust and scalable systems

We have a consistent focus on enhancing our operational efficiencies and monitor key operational
parameters on an ongoing basis. We are strengthening our back end system and processes including
Information Systems, Supply Chain Infrastructure, Zonal Office infrastructure to support the future growth
plans. We had already implemented core modules of SAP ERP package and in the process of rolling out
more modules to make it single source of all information and controls. We have all the business processes
documented in terms of Standard Operating Procedures (SOPs) and strong process audit mechanism to
review them.
Our Business
Retailing
We are one of India’s major retailers with presence in following two segments:
o Lifestyle Retailing - Pantaloons, Central, aLL, Blue Sky

o Value retailing - Big Bazaar, Food Bazaar, Depot, Health Village, Fashion Station
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Our entire operations can be summarized in the following diagram;
Pantaloon
Retail
(India)
Limited
Lifestyle Value
Retailing Retailing
Pantaloons Central aLL Blue Sky Big Bazaar Food Fashion Depot Health
Bazaar Station Village
We started our operations with a trouser brand, Pantaloon. In our initial stages we had small format outlets
branded Pantaloon Shoppe, which were franchise operations. Realising the problems associated with
franchise model, we decided to have our own retail outlets. We launched our own retail store “Pantaloons”
in 1997. We launched Big Bazaar- a hypermarket with over 1,70,000 products as our first offering in value
retailing segment. Food is the largest basket in terms of household expenditure, as a logical extension we
launched our new format Food Bazaar. We have introduced the concept of seamless malls in India through
our format ‘Central’. We have pioneered new retail formats in India like aLL, Fashion Station, Blue Sky,
Pantaloons-‘Fresh Fashions’
Started in 1997 through one 8,000 square feet store in Kolkata, Pantaloons is our first organised
departmental store format targeting the Indian middle class and upper class customers across age and
gender. The focus is largely on apparels and accessories and covers the entire family. We offer a wide
variety of product range including trousers, shirts, casual wear, western and ethnic wear for women,
children’s clothes, accessories and jewellery. We provide a combination of private label and third Party
Label. We have introduced a unique concept of ‘cellular zones’ within our stores that provides the
consumer with all the brands pertaining to a category, showcased together. For e.g., a consumer while
shopping for ladies ethnic wear would find all possible brands clustered together, making her shopping
experience easy and convenient.
We have a wide network of Pantaloons stores spread across the country. Our stores as on October 15, 2006
are located at;
Sr. no City Location Area( Sq. ft) Year of starting
1 Kolkata Gariahat 16,000 1997
2 Hyderabad Begumpeth 16,000 1997
3 Hyderabad Himayat Nagar 9,000 1998
4 Chennai Spencer Plaza 22,000 2000
5 Ahmedabad Ahmedabad 27,500 2000
6 Kolkata Camac street 41,000 2001
7 Kanpur Kanpur 30,000 2001
8 Pune Inox 8,000 2002
9 Mumbai Phoenix ,Lower Parel 50,000 2003
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10 Gurgaon Sahara Mall 17,000 2003
11 Mumbai Center One, Vashi 22,000 2003
12 Baroda Inox 20,000 2003
13 Ahmedabad 10 Acre, Kankaria 20,000 2005
14 Bangalore Sigma Mall 20,000 2005
15 Mumbai R Mall, Mulund 19,500 2005
Sri Vallabh Shopping
16 Mumbai Centre, Borivali 30,000 2005
17 Lucknow Sahara Ganj Marg Mall 20,000 2005
18
Indore Kalyani Mall 20,000 2005
19 Mangalore Cineplex Mall 23,550 2006
20 Shahdara Cross River Mall 25,000 2006
21 Rajkot Kalawad Road 18,000 2006
22 Delhi West Gare Mall 20,000 2006
Total 494,550
Private Labels-“Pantaloons” is a life style retailing format. The objective is to offer differentiated products
not available elsewhere. The focus is on Private Label products and fashion at affordable prices. The
antecedents of our Company lie in garment and fabric manufacturing and trading, this ability to understand
the apparel business has translated into active and strong Private Label offering contributing to 75% of our
total apparel revenues in Pantaloons in the year ended 2006.
Few of our initial Private Labels includes;

Private Label Year of launch Category
Pantaloon trousers 1987 Mens Wear
Bare Jeans 1991 Jeans, shirts, knit wear,
gaberdines, jackets and
other accessories
John Miller 1995 Shirts
Shrishti 1998 Ladies wear
Scotsville 1999 Winter wear- sweaters,
cardigans and blazers
Annabelle 1999 Ladies western wear
Ajile 2000 Sports wear
Our other Private Labels in the apparel segment include RIG, Euforia, JM Sport, Akkritti, Ghagroos,
Arabesque, Honey, Chalk, F, Lombard, T2000 and Gajra.
An intensive Private Label offering requires a proactive and innovative design team. To fulfill this
objective a Design Studio was created at Mumbai. We have a design team comprising of 38 members,
including qualified graduates form National Institute of Fashion Technology (“NIFT”), National Institute
of Design (“NID”), Nottingham Trent University,UK and other institutes. The team has a combination of
senior designers and new recruits providing a mix of experience and youth. In addition to conceptualising
designs for apparels, the team also designs and develops logos, labels and tags. Presence of a dedicated
design team has resulted in faster introduction of new Private Labels as well as ensures that all existing
Private Labels undergo frequent refurbishment.
Big Bazaar- ‘Isse Sasta aur accha kahin nahin’
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On October 12, 2001, we launched ‘Big Bazaar’as our offering in the value retailing segment. By removing
inefficiencies from the distribution chain we are able to unleash attractive savings which are passed on to
the consumer. Big Bazaar is India’s first hypermarket in the discount store format. Big Bazaar provides
more than 225,000 items- food, grocery, utensils, kitchen needs, home needs, bath needs, toys, stationery,
electronics and white goods which are sold at a discount to the maximum retail price. Price is the principal
value proposition at these stores.
A big driver at Big Bazaar is the product variety. This is achieved by selling a wide range of products and
through the “Shop-in-Shop” format. As a result, a typical Big Bazaar comprises shops that stock medicines,
optical accessories, camera rolls, bakery products, dry fruits, crockery, glassware, health and beauty
products, ladies accessories, electronics, infant necessities, watches, clocks, computer accessories, food and
beverages, stationery, readymade garments, household appliances, home furnishings, luggage.We believe
this is a win- win situation as the customer is assured of product availability, the shop owner can benefit of
the infrastructure and we enjoy assured income without needing to stock inventory. Also the Shop-in-Shop
offering is able to increase the customer traffic into the stores. The Big Bazaar has been positioned to the
customer as a place where the customer can shop for each and everything for which it goes to a market.
In July 2006, Big Bazaar was awarded the ‘CNBC TV 18 Awaaz Consumer Award 2006’ in the retail
category as the most preferred, large , food and grocery store.
The number of Big Bazaar stores has increased from 4 in 2002 to 33 till October 15, 2006:
1 Kolkata Vip Road, Kolkata 25,000 2001

Maheshwari Palace Mall, 43,500 2001
2 Hyderabad Abids
3 Bangalore Koramangla 36,000 2001
4 Mumbai Phoenix, Lower Parel 40,000 2002
5 Mumbai Mulund 56,000 2003
6 Gurgaon Sahara Mall, Gurgaon 45,000 2003
Nagpur Landmark,Dhantoli, Wadi 48,600 2003
7 Road
8 Ahmedabad Rudra Point, Ahmedabad 55,000 2004
9 Bhubaneshwar Forum Bhubaneshwar 40,000 2004
10 Nasik The Zone, College Road 26,000 2004
11 Kolkata Hi-land Park 22,500 2004
12 Ahmedabad Kankaria 66,300 2004
13 Ghaziabad East Delhi Mall 50,000 2004
14 Durgapur Dreamplex, Durgapur 26,000 2005
15 Mumbai Lake City- Thane 42,000 2005
16 Mumbai Growel Plaza, Kandivli 65,000 2005
17 Bangalore Banshankari 98,300 2005
18 Sangli New Pride Multiplex 24,100 2005
Parsvnath Metro Mall, 32,500 2005
19 Delhi DMRC Inderlok
20 Delhi DMRC, Wazirpur 35,000 2005
G V Manor Dwarka 47,200 2005
21 Vishakhapatnam Nagar
22 Lucknow Sahara Ganj Mall 55,000 2005
23 Pune Wanawari 29,000 2005
24 Indore Kalyani Mall 40,000 2005
25 Bangalore Shanti Nagar 35,000 2006
26 Ahmedabad City Gold, Bapu Nagar 25,000 2006
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27 Mangalore Cineplex Mall 27,200 2006
28 Rajkot Kalayad Road 40,000 2006
29 Bangalore KSRTC Bus stand 45,000 2006
30 Ambala Minerva Complex 30,000 2006
31 Agra Pacific Mall 44,000 2006
32 Bangalore Old Madras Road 160,000 2006
33 Nagpur Poonam City pulse 85,000 2006
Total 1,539,200
We have also launched our Private Label initiative in Big Bazaar. Understanding of the apparel industry,
decades of experience and a vertically intergrated structure provides us with more compelling reasons to
expand the number of Private Labels. We have launched a full range of accessories to supplement our
apparel business including imitation jewellery, sunglasses, watches, mobile phones etc.
Food Bazaar- ‘Wholesale prices’
We ventured into food retailing with Food Bazaar in April 2002. It began as a part of Big Bazaar and now
operates as standalone outlets in addition to being part of Big Bazaar. Food Bazaar provides a wide product
range from fresh fruits and vegetables to FMCG products and ready-to-cook products. It stocks about 8,000
to 12,000 SKUs per location. Food Bazaar’s core concept is to create a blend of a typical Indian market and
International supermarket atmosphere with the objective of giving the customer all the advantages of
Quality, Range and Price associated with large format stores. Food Bazaar offers the Indian consumers
convenience, cleanliness and hygiene through pre-packed commodities while retaining Indian’s preference
of "See- Touch- Feel" created by displaying products out in the open at competitive prices. Food Bazaar
also provides home delivery services to the customers.
Processed food and non- processed food are the dominant category. This category includes products from
various FMCG companies in India as well as a wide assortment of imported, health and speciality foods.
In 2003-04, a series of initiatives were launched to bring convenience into the daily shopping habits of the
consumers which included;
Live dairy - providing fresh milk and milk products like paneer, butermilk, ghee, and low fat milk
Live grinding facilities - customers can buy wheat, spices and have it ground
Live bakery-providing freshly made bread and bakery products
Fresh juice corner
Live kitchen. Customers have the option of buying vegetables and getting them chopped. They can
also get the vegetables fully coooked or semi-cooked. Introduced sandwiches, salads and soups
These live services has been introduced keeping in mind the Indian consumer preference of having fresh
food. Spurred by the popularity of the services offered by Food Bazaar we launched our Private Label
programme covering various products such as tea, salt, ready mix masala(Food Bazaar Tea), basmati rice,
dals and pulses (Premium Harvest), jams and sauces (Tasty Treat), handwash and shampoo(Caremate),
cleansers (Cleanmate) etc. We have a dedicated team in place that researches, conceptualises and
introduces new products.
Our network of Food Bazaars across the country as on October 15, 2006 are as follows;
Sr. no City Location Area( Sq. ft) Year of
starting
1 Mumbai Phoenix, Lower Parel 10,000 2002
2 Kolkata Vip Road, Kolkata 5,000 2002
3 Hyderabad Abids 6,500 2003
4 Mumbai R Mall Mulund 14,000 2003
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5 Bangalore Koramangla 6,000 2003
6 Gurgaon Sahara Mall, Gurgaon 11,000 2003
7 Nagpur Land Mark, Nagpur 5,400 2003
8 Mumbai Centre One, Vashi 9,000 2003
9 Kolkata Alipore 6,000 2004
10 Ahmedabad Rudra Point 10,000 2004
11 Kolkata Camac Street 5,000 2004
12 Bhubaneshwar Forum-Bhubaneshwar 5,000 2004
13 Nasik The Zone, College Road 5,000 2004
14 Bangalore Hosur Road 9,600 2004
15 Mumbai Goregaon 21,260 2004
16 Mumbai Oshiwara, Andheri 19,980 2004
17 Kolkata Hi-land Park 7,500 2004
18 Mumbai Eastern Mall, Malad 7,500 2004
19 Ahmedabad Kankaria 14,000 2004
20 Ghaziabad East Delhi Mall 10,000 2004
21 Durgapur Dreamplex, Durgapur 5,000 2005
22 Mumbai Thane 10,000 2005
23 Mumbai Kandivli 10,000 2005
24 Delhi Shipra, Ghaziabad 18,868 2005
25 Bangalore Promenade 15,000 2005
26 Sangli New Pride Multiplex, Sangli 6,500 2005
Parsvnath Metro Mall, DMRC 2005
27 Delhi Inderlok 10,000
28 Delhi DMRC, Wazirpur 10,000 2005
29 Vishakhapatnam G V Manor Dwarka Nagar 10,000 2005
30 Ghaziabad MMX Mall Ghaziabad 17,000 2005
31 Kolkata Gariahat Road 10,200 2005
32 Lucknow Sahara Mall 10,000 2005
33 Pune Wanawri 6,000 2005
34 Indore Kalani Mall 10,000 2005
35 Bangalore Sigma Mall 9,000 2006
36 Bangalore Garuda Mall 5,000 2006
37 Bangalore, Shantinagar 7,000 2006
38 Wazipur (Mezzanine Floor) 12,000 2006
39 Ahmedabad City Gold- Bapu Nagar 5,000 2006
40 Mangalore Cineplex Mall, Bijay 10,000 2006
41 Delhi Rohini 12,000 2006
42 Kolkata Eastern Bypass 12,000 2006
43 Rajkot Kalayad Road 10,000 2006
44 Bangalore KSRTC Bus Stand 10,000 2006
45 Ambala Minerva Complex 5,000 2006
46 Bhubaneshwar Maruti Mall 7,000 2006
47 Indore Sapna Sangeeta Mall 7,000 2006
Nagpur Poonam City Pulse 35,000 2006-10-23
48
482,308
Total
Central- ‘Shop, Eat, Celebrate. In the heart of the city’
Central is our second offering under the lifestyle format. Central is a seamless mall. The concept of
seamless mall is relatively new to India and Central is a pioneer of this format. The design of the mall
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does away with in-between walls and Shop-in-Shops thus offering customers unobstructed shopping
experience.
The first Central opened in Bangalore on May 14, 2004. Located in the heart of the city, the mall is spread
over 125,000 Sq. ft. across five floors and provides customers with a wide array of facilities ranging from
shopping, eating, leisure and entertainment. The mall allows customers to choose from amongst a range of
brands in apparel, toys, books, music, sports, lifestyle accessories and more under one roof. Central also
has a Food Bazaar, food courts and restaurants. The second Central was launched in Hyderabad in
November, 2004 covering an area of 216,000 Sq. ft. In April 2005 the third Central was launched in Bund
Garden, Pune covering an area of 137,000 Sq. ft. Central provides a platform to showcase in house labels
amidst other national and international brands thereby improving our brand visibility.
Speciality Retail Stores
During past two years company has progressively introduced many new formats in the area of speciality
retail both in life style retailing as well as value retailing catering to niche markets. These formats include:
Fashion Station
A thematic store, Fashion Station is an attempt to offer current fashion products to the mass market. We
believe with increasing media penetration and a proliferation of television channels some of which cover
fashion extensively, the average Indian is being steadily exposed to bolder and more contemporary
fashion. Fashion Station is positioned to meet the fashion requirements of this growing number of
customers. Presently we have five 5 stores operating in five cities occupying an area of 91,500 sq ft.
aLL-‘A little larger’

aLL is our latest format in the Lifestyle retail segment. aLL is our exclusive store dedicated to the fashion
needs of both plus size men and women which has been launched as a single dedicated stand-alone store. It
was launched in Vashi, Mumbai on July 16, 2005 and presently we operate 6 aLL stores covering over
7,900 sq. ft. The ‘aLL’ store houses a wide range of ready-to-wear fashionable clothes and accessories that
are otherwise not easily available for plus size customers. The store has a wide collection to select from -
western wear, indo-western and ethnic wear in both formal and casual categories. Matching accessories like
belts, ties, and handbags are also available.
Blue Sky
Blue Sky is a national chain of stores offering a wide selection of branded and private label sunglasses and
watches. Blue Sky has been designed to address the growing market for accessories. Customers get a wide
and interesting collection of fashion brands from across the world as well as from the company’s exciting
range of Private Label watches, namely, Cube, Koenig, RIG, Lombard and UMM. Presently we operate
four Blue Sky stores covering 2,500 sq ft.
Depot
Depot is one of the recent formats introduced by us. We retail books, multimedia, toys, stationary and gifts
through this outlet. A wide range of books from fiction to general reference, management and children’s
material and a wide category of music CDs and cassettes spanning all genres like Rock, Pop, Hindi,
Indipop etc. are retailed.
Depot Store also has an attractive selection of gifts (candles, mugs, photo frames, and themed packs) toys
and stationery (office, children’s and fancy stationery). Depot is presently operating from 3 stores covering
11,300 sq. ft
Health Village
Health Village focuses on three key areas of health, fitness and beauty and operates under multiple formats
for each area.
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Under the format named ‘Tulsi’ pharmacy we retail allopathic, ayurvedic and homeopathic medicinal
products. We have entered into a memorandum of understanding with Manipal Health Systems to operate
pharmacies and medical services across the country.
We operate a Yoga centre under the name ‘Lotus’. We have entered into a joint venture with Talwalkar
Better Value Fitness Private Limited, a leading gymnasium operator. ‘Roots’ is our hi-tech and modern
gymnasiums in association with Talwalkars group. Our health café named ‘Elaichi’ provides expert advice
to our customers on how to eat right that has a direct effect on living right. We cater to the beauty segment
through our format Star & Sitara.
Our first Health Village was launched at ten acres in Ahmedabad covering an area of 10,200 sq. ft. in the
year 2006.
ConvergeM
Realising the potential in the mobile space, we set up a new division called ‘ConvergeM’ to identify,
develop and bring to market mobile product and solutions tailor-made to suit the consumers requirement.
ConvergeM operates both in value and lifestyle platforms. In value offering, it operates the format
‘MBazaar’. Primarily aimed at replacement market, an ‘MBazaar’ is typically located within most Big
Bazaar stores. It retails both GSM and CDMA mobile handsets, postpaid and prepaid connections, recharge
coupons, mobile accessories, fixed line telephony instruments, etc. In the lifestyle segment Converge M has
two offerings Gen M and M Port. GenM focuses on the youth and teen market and offers mobile handsets,
airtime recharges, gaming and music accessories, facility of printing photos from mobile phones. GenM
operates within Pantaloons, Food Bazaar and Fashion Station. M Port offers IT based applications such as
personal computing, Small Office Home Office (SOHO) products, printing solutions and accessories. It is
situated independently or within Pantaloons and Central Malls.
Subsidiaries
Home Solutions Retail (India) Limited
Home Solutions Retail (India) Limited (“HSRIL”), a subsidiary of the Company, was incorporated to offer
solutions in home retailing. The key product category are consumer durable and furniture, home furnishing
and décor, home improvement and home services.We have through this subsidiary ventured into retailing
of furniture and furnishings and electronic and consumer goods. Currently HSRIL have the following
formats under operation
Collection-I
‘Collection I’ is a lifestyle furniture store and is built on the concept of ideas for home decor, offering latest
models in furniture, furnishings and home accents. The first store of this format was opened in April 2006
covering 10,000 sq. ft area in Indore.
Furniture Bazaar
‘Furniture Bazaar’' offers an entire range of Home Furniture and furnishings. Currently, there are three
stand alone stores of this format in three different cities of the country over and above various cut-ins of
Furniture Bazaar available at various Big Bazaar stores.
E-Zone
‘E-Zone’ retails consumer and electronic durables E-Zones are primarily standalone stores but they are also
present in Central Malls. Currently, there are three stand alone stores of this format in three different cities
of India.
Electronics Bazaar
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‘Electronics Bazaar’ offers branded electronic goods and appliances. Presently there are four stand alone
Electronic Bazaar stores located at Mangalore, Ghaziabad, Ahmedabad and Mumbai apart from cut-ins
within Big Bazaar Stores.
Pantaloon Food Product (India) Limited
‘Pantaloon Food Products (India) Limited’, was incorporated with the object of sourcing and backward
integration of food business of our Company. It has sourcing and distribution bases at all key cities of the
country.
PAN India Restaurants Limited
‘PAN India Restaurants Limited’, a subsidiary company, was incorporated to carry on the business of quick
service restaurants and kiosks. This company operates food on go retail format. We, through our subsidiary
PAN India Restaurants Limited launched a chain of snack kiosks called ‘Chamosa’ and Food Stop. These
kiosks are located in high traffic areas such as malls, multiplexes, bus stands, railway platforms,
commercial complexes and airports.
Footmart Retail (India) Limited
Pursuant to a shareholder agreement dated November 30, 2005 (the “Shareholder Agreement”) with
Liberty Shoes Limited, we have formed a joint venture company named Footmart Retail (India) Limited
wherein we hold 51% equity stake and the balance 49% is held by Liberty Shoes Limited. This joint
venture company was incorporated on November 17, 2005. In terms of the Shareholders Agreement we
have agreed to not compete with the business of Footmart until a period of two years from the date of our
ceasing to own shares in the company. Further, we will not be able to transfer any of the shares in the
company for a period of three years from the date of this agreement except with the written consent of the
other party. The company operates footwear value- retail format “Shoe Factory”. Currently, there are five
“Shoe Factory” (stand alone stores) of this format in different cities of India.
Future Media (India) Limited
‘Future Media (India) Limited’ has been set up to manage the Out of Home Media Business. The company
will manage and sell in-store media rights.
Future Logistic Solutions Limited
‘Future Logistic Solutions Limited’ has been formed to manage logistics activities of our Company and
subsidiaries. The company is yet to commence its commercial operations.
Convergem Retail (India) Limited
‘Convergem Retail (India) Limited’ has been set up to manage our communication business.
CIG Infrastructure Private Limited
‘CIG Infrastructure Private Limited’ has been formed to participate in PPP (Public-Private Participation)
projects.
KB Infin Limited
‘KB Infin Limited’ was formed to manage the financial services business of the Future group. KB Infin
Limited is a capital holding company and manages the asset management business. The name of this
company is proposed to be changed to “Future Capital Holdings Limited” and has following subsidiaries:
KSHITIJ Investment Advisory Company Limited
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‘KSHITIJ Investment Advisory Company Limited’ is an investment advisor to domestic scheme of Kshitij
Venture Capital Fund (“Kshitij”). Kshitij is a Rs. 3,500 million ‘Real Estate Venture Capital Fund’ focused
on retail and commercial real estate.
Ambit Investment Advisory Company Limited
‘Ambit Investment Advisory Company Limited’ is an investment advisor to Horizon scheme of Kshitij
Capital Venture Fund (“Kshitij”) and Horizon Realty Fund LLC, Mauritius. The fund has a corpus of US
USD350 million to invest into real estate.
Indivision Investment Advisors Limited
‘Indivision Investment Advisors Limited’ acts as a domestic advisor to Mauritius based advisor of
Indivision India Partners LLC, Mauritius, (Private Equity Fund) having a corpus of USD 425 million.
Myra Mall Management Company Limited
‘Myra Mall Management Company Limited’ is a special purpose vehicle which has been formed to acquire
office premises at Parel, Mumbai. The company owns office premises of 44,000 square feet at Peninsula
plaza.
Future Bazaar India Limited
‘Future Bazaar India Limited’ has been formed in 2005-06 to manage our E-retailing initiative -online
retail portal, www.futurebazaar.com.
Entertainment and Leisure
Galaxy Entertainment Corporation Limited
To mark our foray in the leisure and entertainment market we acquired 15.73% stake in ‘Galaxy
Entertainment Corporation Limited’ during 2004-05. The company’s flagship store is situated in Mumbai
and has bowling lanes, a sports bar, a large gaming zone and an indoor party zone.
Manufacturing
We believe our business model is unique because we have successfully integrated backwards into the in-
house manufacture of part of the apparel products sold from our shelves. Through our manufacturing
capabilities we have the ability to control garments from the initial stages in the value chain, to tide over
unexpected demand and cope with the unpredictable world of fast changing fashion trends. The resulting
seamless integration and relative independence from intermediaries represents a competitive advantage in
terms of value, cost and convenience.
We have a trouser manufacturing plant at Tarapur. The trouser manufacturing plant is equipped with state-
of art, fully automatic machines for fusing, serging, bottom hemming and welt pocket- making operations.
The factory has a capacity to manufacture 3,000 trouser pieces a day.
We use our manufacturing strengths to focus on enhancing product knowledge. The division works closely
with the design team and the research and development team to understand trends, develop products, value
engineer and finally create season wise collection that cater to regional tastes.
Processes and support functions
Category Management:
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We have employed the concept of category management in our day-to-day merchandising function as
against the traditional brand management merchandising practice followed by most retailers. Category
managers look at sales and margins of each product group in a category. The whole idea of category
management is to create products across the spectrum of a category at different price points, fabrics,
design, shape, seasons, colour and size. Category manager is entrusted with the responsibility of managing
the merchandise throughout the product life-cycle including, planning, sourcing, procurement,distribution,
promotion etc.
Visual Merchandising:
In modern retail, we believe that visual merchandising is the key to encourage a customer to purchase the
products. Visual merchandising involves store window, store directories, in-posters, unit top poster / visual,
placement of products, highlighting products in the store. We use our visual merchandising skills to present
our merchandise at its best, in order to appeal to the customer. This is a critical in store activity with our
visual merchandising team deciding on the theme as well as the manner in which the merchandise is
proposed to be displayed across our stores nation wide.
Supply Chain management-

Availability of products at the right time and right place is of utmost importance in retail business. Supply
Chain management ensures this. The diverse requirements of different retail formats in which we operate
require a model which is flexible enough to meet the diverse requirement of our various formats. Keeping
this in mind, we have created our own supply chain and logistics model. The Supply Chain function
involves vendor management, quality assurance, transportation and warehouse management.
The quality assurance function has been strengthened with the implementation of internal quality control
measures. Quality hubs have been established at zonal level with a view to proactively prevent quality
defects.
We have one central warehouse at Tarapur and 21 regional warehouses. These warehouses are located in
Delhi, Gurgaon, Ghaziabad, Lucknow, Indore, Kolkata, Bhubaneshwar, Tarapur (3), Mumbai, Ahmedabad,
Bhiwandi, Pune, Nagpur, Nasik, Bangalore, Hyderabad, Vizag, Mangalore, and Coimbatore.
Information Technology
A key element of the corporate functions is the Information Technology strategy and set up. We understand
the importance of continuously upgrading our systems to address the growing demands of customers,
ensuring a seamless flow of activities and proper business process support.
At present, business planning occurs through a high-end planning tool called ‘Cognos Planning’, while data
analysis is undertaken through ‘Cognos Powerplay’. They are a highly analytical platform that enables data
to be drilled down to the lowest level. SAP Financials, the backbone of accounting function, integrates the
accounting function across geographies and formats, and gives on-line access to the company’s overall
financial position at any given point in time.
We have implemented mySAP Business Suite - IS Retail Solution, for core transactions and financial
management and are now in the process of implementing advanced functionalities and modules from the IS
retail suite, like SAP MAP Tool for Merchandise and Assortment Planning; Automated Replenishment
systems, Advanced Warehouse Management, CRM, BW for Analytics and Business Intelligence, and SAP
HR Solutions, for a robust retail operation.
We have implemented a fully integrated transaction processing system, which would accumulate accurate
real time data with respect to key function of the organization performs such as merchandise management,
procurement, manufacturing, warehousing, logistics, inventory management, store operations and financial
management.
Human Resource
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In a business where individuals comprise the principal asset, the structure of the people pyramid influences
the quality of knowledge captured, the speed with which decisions are made and the morale of the
organization. Human Resource is one of the critical support functions and forms another key element of the
corporate backbone. We have around 14,000 employees as on October 15 2006. We are a very young and
energetic organization with average employee age being 25 years.
We believe that service is our core philosophy and people are our most important resources. Our attempt
has always been to create an environment where our employees feel proud of being called ‘Pantaloonians’.
Our Human Resource philosophy is driven through our five pillars of people based growth:
a. Corporate values based culture
b. Performance Management through Balanced Score Card
c. People Processes
d. Management Processes
e. Leadership Excellence
Organisation Design
We follow an inverse pyramid structure; as a result decisions are taken closest to the point of customer
action. Sales executive are encouraged to think customer first. They are empowered to run their respective
departments like ‘small business owners’.
Inverse Pyramid Structure
Sales and support staff
Departmental Managers
Store Mgr., Buyers,

Merchandise Mrg,
RM, GM
Board of
Directors
Competition
We face competition from other retailers of similar products and services. These include stand alone stores
in the organized and unorganized sector, as well as other chains of stores including department stores.
We focus on offering our customers a vast variety of products and services catering to their diverse
requirements and needs. We are the pioneers in launching various new formats in the country such as
Central, aLL etc. It is because of this and the service and ambience that we offer, that we believe we have
been able to create a differentiation in the mind of the customer vis-à-vis our competitors where similar
products and brands are available.
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REGULATIONS AND POLICIES
The Company, in its business of retail and establishing retail stores in India, is governed by various
legislations as applicable to it, its stores and the goods/products it sells or stores for sale.
Shops and Establishments Acts
The Company is governed by the various Shops and Establishments Acts as applicable in the states where it
has stores. These acts regulate the conditions of work and employment in shops and commercial
establishments and generally prescribe obligations in respect of inter alia registration, opening and closing
hours, daily and weekly working hours, holidays, leave, health and safety measures and wages for overtime
work. The following acts are applicable to our stores.
• The Andhra Pradesh Shops and Commercial Establishments Act, 1988;

• The Bombay Shops and Establishments Act, 1948;
• The Delhi Shops and Establishments Act, 1954;
• The Karnataka Shops and Commercial Establishments Act, 1951;
• The Madhya Pradesh Shops and Establishments Act, 1958;
• The Orissa Shops and Commercial Establishment Act, 1956;
• The Tamil Nadu Shops and Establishments Act, 1947;
• The Uttar Pradesh Shops and Commercial Establishments Act, 1962; and
• The West Bengal Shops and Establishments Act, 1963.
Other Regulations
The Company’s trademarks are required to be registered under the provisions of the Trademarks Act, 1999.
The Company is also required to comply with local/municipal regulations in respect of each of its stores as
given below.
• The Cantonments Act, 1924;

• The Haryana Municipal Corporation Act, 1955;
• The Karnataka Municipal Corporation Act, 1976;
• The Mumbai Municipal Corporation Act, 1888; and
• The New Delhi Municipal Council Act, 1994.
The Company is required to comply with the provisions of the Standards of Weights and Measures Act,
1976 and the rules made there under, particularly the Standards of Weights and Measures (Packaged
Commodities) Rules, 1977. Similarly, the Company is required to comply with the provisions of the
Prevention of Food Adulteration Act, 1954 and the rules made there under. In addition to the above, the
Company is governed by the provisions of the provisions of the Insecticides Act, 1968.
Fiscal Regulations
In accordance with the Income Tax Act, 1961 any income earned by way of profits by a company
incorporated in India is subject to tax levied on it in accordance with the tax rate as declared as part of the
annual Finance Act.
The Company, like other companies, avails of certain benefits available under the Income Tax Act, 1961.
Further, the import of some of the Company’s merchandise stocked at its stores involves the levy and
payment of customs duty in accordance with the prevalent rates prescribed in the Customs Act, 1962 and
rules and notifications issued thereunder from time to time. The Company is also required to obtain a
license under the provisions of the Export Import Policy 2002 – 2007.
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Employment Related Regulations
The Company is governed by the provisions of the Employees’ Provident Funds Act, 1952 and the rules
made thereunder and is accordingly required to make periodic contributions to the Employees’ Provident
Fund Scheme and the Employees’ Pension Scheme as applicable. The Company is also required to make
contributions under the Employees’ State Insurance Act, 1948.
Contract Labour (Regulation and Abolition) Act
The Company engages for each of its stores the services of various contractors for various activities
including gift wrapping, house keeping security, maintenance, tailoring and valet services. These
contractors in turn employ contract labour whose number exceeds twenty in respect of some of the stores.
Accordingly, the Company is regulated by the provisions of the Contract Labour (Regulation and
Abolition) Act, 1970 which requires the Company to be registered as a principal employer and prescribes
certain obligations with respect to welfare and health of contract labour.
Foreign Investment Regulations
An industrial policy was formulated in 1991 (the “Industrial Policy 1991”) in order to implement the
economic reforms initiated by the government of India. The GoI has since amended the Industrial Policy
from time to time in order to enable foreign direct investment in various sectors of the Indian industry in a
phased manner gradually allowing higher levels of foreign participation in Indian companies. However as
per the current Central Government policy on foreign direct investment, foreign direct investment in Indian
companies carrying on retail trading activity is prohibited. However, the government has permitted foreign
direct investment upto 51% with prior government approval in ‘single brand’ retail trading. Further the
products to be sold should be of ‘single brand’ only, the products should be sold under the same brand
internationally and ‘single brand’ product-retailing would cover only products which are branded during
manufacturing.
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BOARD OF DIRECTORS AND SENIOR MANAGEMENT
Our corporate governance bodies comprise the Board of Directors, the Audit Committee, the Remuneration
Committee and the Shareholders Grievances Committee.
The Board of Directors represents the interests of shareholders and is responsible for our general
management and approves our strategic and operational plans. The Board of Directors also has the overall
responsibility for the administration of our day-to-day activities.
As per our Articles of Association, our Board shall consist of not less than three Directors and not more
than 12. Of this not less than two thirds of the total number of Directors of our Company shall be persons
whose period of office is liable to determination by retirement of Directors by rotation. We currently have
10 Directors. The minimum and maximum number of Directors may be increased or decreased by an
ordinary resolution of the Company’s shareholders, subject to the provisions of the Company’s Articles of
Association and the Companies Act.
BOARD OF DIRECTORS
The Board of Directors has the ultimate responsibility for the management and administration of our
affairs, unless otherwise directed by the Articles of Association, or Indian law. The following persons
constitute our Board of Directors:
Sr. No. Name Designation

1. Kishore Biyani Managing Director
2. Gopikishan Biyani Whole time Director
3. Rakesh Biyani Whole time Director
4. Shailesh Haribhakti Independent Director
5. Darlie Koshy Independent Director
6. S. Doreswamy Independent Director
7. Anju Poddar Independent Director
8. Bala Deshpande Nominee Director
9. Ved Prakash Arya Director –Operations &

Chief Operating Officer
10. Anil Harish Independent Director
The business address of all our Directors is:

Pantaloon Knowledge House, Shyam Nagar, Off. Jogeshwari Vikhroli Link Road, Jogeshwari (East),
Mumbai 400 060.
BRIEF BIOGRAPHY OF OUR DIRECTORS
Kishore Biyani 46 is the Managing Director of the Company. He is a commerce graduate with a Post
Graduate Diploma in Marketing Management and is the driving force behind innovating new concepts such
as Big Bazaar-discount stores, Central Malls-seamless shopping. He has over 25 years of experience in the
field of manufacturing and marketing of ready-made garments. He is at the helm of affairs, guiding the
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group to its present status in the industry. He has won many awards including the ‘Retail Face of the Year-
Images Retail Awards 2005’.
Gopikishan Biyani, 61 is a Commerce graduate. He is a Whole time Director of the Company and looks
after the manufacturing operations. He has more than two decades of experience in the textile business. He
has been on the Board of our Company since June 1, 1991.
Rakesh Biyani, 34 is a Whole time Director of the Company. He is a commerce graduate. He is actively
involved in category management, retail stores operations, information technology and the export
operations of our Company. He has been in this industry for more than a decade and has been instrumental
in the implementation of our various new formats. He has been on the Board of our Company since June
27, 1992.
Shailesh Haribhakti, 50 is a Chartered Accountant, Cost Accountant, and a Certified Internal Auditor. He
is the Deputy Managing Partner of Haribhakti & Co., Chartered Accountants. He is the Chairman of the
Banking, Finance and Insurance Committee of the Indian Merchant’s Chamber and a member of the Adhoc
Advisory Committee for Master’s Degree in Management Studies, University of Mumbai. He is on the
board of several companies, including Indian Petrochemicals Corporation Limited, Ambuja Cement
Eastern Limited, GIC Asset Management Company Limited, IDBI Capital Market Services Limited,
Walchand Capital Limited Birla Global Finance Limited and Mahindra Gesco Developers Limited. He has
been on the Board of our Company since June 1, 1999.
Dr. Darlie O. Koshy, 51 has done his Masters in Business Administration and holds a PhD from the Indian
Institute of Technology, Delhi. He has over 29 years of experience in the textiles, fashion and garment
industry. He is the Director of the National Institute of Design, Ahmedabad and the Chairman of the
National Design Business Incubator. He has played a key role in setting up centres of the National Institute
of Fashion Technology in Delhi, Chennai and Bangalore during 1988-2000 and since then has spearheaded
the transformation of the National Institute of Design including setting up new campuses in Bangalore and
Gandhinagar. He has been and continues to be a part of various committees constituted by the Ministry of
Textiles, the Ministry of Commerce & Industry and the Planning Commission. He is a renowned educator
and an expert in marketing, fashion, retail, branding, design management, design policies and strategic
issues. He has been on the Board of our Company since July 27, 1999.
S. Doreswamy, 69 has a vast experience in banking and finance. He has completed a Bachelors degree in
Science and also holds a Bachelors degree in Law. He retired as Chairman and Managing Director of
Central Bank of India. He is the Chairman of CanFin Homes Limited and is also on the Board of Ceat
Limited, the Deposit Insurance and Credit Guarantee Corporation and Can Fin Homes Limited. Hehas been
on the Board of the Company since September 29, 2000.
Anju Poddar, 56 holds a Bachelors degree in Engineering from the University of Oklahoma. She has
varied interests such as textile and weaving, jewellery designing, contemporary modern art and counselling.
At present she is Director in Maharshi Commerce Limited, Samay Books Limited, Continental Projects
Limited and the National Institute of Fashion Technology, Hyderabad chapter. She is also the Joint-
Secretary of Craft Council of Hyderabad. She has been on the Board of our Company since September 29,
2000.
Bala Deshpande, 40 is a nominee of ICICI Venture Funds Management Company Limited. She has been
nominated to our Board with effect from August 9, 2001. She holds a Masters degree in Economics from
Mumbai University and a Masters in Management Studies from the Jamnalal Bajaj Institute of
Management Studies, Mumbai. She has multi-industry exposure and has worked with leading companies
such as Bestfoods, Cadburys and ICI Limited. She was part of the strategic team at Bestfoods and was also
nominated for the Woman Leadership Forum held at Bestfoods, New York. She is on the board of several
other companies including Subhiksha, Air Deccan, Nagarjuna Construction, Welspun, TechProcess
Solutions, Naukri.com, etc.
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Ved Prakash Arya, 36 is Director - Operations and Chief Operating Officer. He is an Engineer and has
done his Masters in Business Administration from the Indian Institute of Management, Ahmedabad. He has
also done a one year research scholarship in International Marketing from France. He has over ten years of
work experience. He started his career with Hathaway Investments Limited and has worked for ASIANET
and H&R Johnson in various capacities. His previous assignment prior to joining us was with GLOBUS as
Chief Executive Officer. He has been on the Board of our Company since April 27, 2004.
Anil Harish, 52 is the partner of D.M. Harish & Co., Advocates & Solicitors. He holds a Master in Law
from the University of Miami, U.S.A. and specialises in income tax, FEMA and property matters. He is on
the board of various companies like Hotel Leela Ventures Limited, Mahindra Gesco Developers Limited,
Unitech Limited and Hindu TMT Limited. He has been on the Board of our Company since August 24,
2004.
COMPENSATION AND BENEFITS IN KIND GRANTED TO THE DIRECTORS
Remuneration Details of Executive Directors
Kishore Biyani-Managing Director
Mr. Kishore Biyani was re-appointed for a further period of five years with effect from April 1, 2005
which was approved by the shareholders of our Company in the Annual General Meeting held on
November 22, 2005. The shareholders authorized the Board of Directors to increase the remuneration
of Kishore Biyani subject to limits specified under Schedule XIII to the Companies Act, 1956. The
Remuneration Committee and Board of Directors in their meeting held on September 30, 2006
approved the payment of commissions to Mr. Biyani of 1% of the net profit of the Company subject
to a maximum of Rs. 10 million p.a. with effect from July 1, 2006 in addition to his remuneration of
Rs. 16 million. His remuneration includes the following:
Particulars Remuneration
Basic Salary Rs. 8.4 million p.a.
House Rent Allowance Rs. 1.68 million p.a.
Perquisites The maximum amount of
perquisites is restricted to Rs. 328,800 p.a.
Contribution to Provident Fund Rs. 1.008 million p.a.
Adhoc Allowance Rs. 4.584 million p.a.
Variable Performance Bonus -
Gopikishan Biyani - Wholetime Director
Gopikishan Biyani was appointed as a Wholetime Director of the Company with effect from June 1,
1991. He was re-appointed for a further period of five years with effect from April 1, 2005 which was
approved by the shareholders of our Company in the Annual General Meeting held on November 22,
2005. The shareholders authorized the increase in remuneration of Gopikishan Biyani subject to
limits specified under Schedule XIII to the Companies Act, 1956. The Remuneration Committee and
Board of Directors in their meeting held on September 30, 2006 approved the increase in his
remuneration to Rs. 5.5 million p.a. with effect from July 1, 2006. He is also entitled to certain other
benefits as given below:
Perquisites The maximum amount of perquisites is restricted to Rs.
328,800 p.a.
Commission
Adhoc Allowance Rs. 0.58 million
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Rakesh Biyani –Wholetime Director
Rakesh Biyani was appointed as a Wholetime Director of the Company with effect from July 27,
1992. He was re-appointed for a further period of five years with effect from April 1, 2002 which was
approved by the shareholders of our Company in the fifteenth Annual General Meeting held on
December 20, 2002. The shareholders authorized the increase the remuneration of Rakesh Biyani
subject to the limits specified under Schedule XIII to the Companies Act, 1956. The Remuneration
Committee and Board of Directors in their meeting held on September 30, 2006 approved the
payment of commissions to Mr. Biyani of 1% of the net profit of the Company subject to a maximum
of Rs. 5 million p.a. with effect from July 1, 2006 in addition to his remuneration of Rs. 11.5 million.
His remuneration includes the following:
Perquisites Perquisites up to a maximum of Rs. 328,800 p.a.
Commission Rs. 0.5 million p.a.
Ved Prakash Arya - Chief Operating Officer
Ved Prakash Arya was appointed as Director – Operations & Chief Operating Officer of the Company with
effect from April 27, 2004 which was approved in the seventeenth Annual General Meeting held on
December 15, 2004. The Remuneration Committee and Board of Directors in their meeting held on
September 30, 2006 approved the increase in his remuneration to Rs. 19 million p.a. with effect from July
1, 2006. He is also entitled to certain other benefits as given below:
Perquisites The maximum amount of
perquisites is restricted to Rs.328,800 p.a.
Commission
Variable Performance Bonus Rs. 5 Million p.a.
Non-Executive Directors:
Directors Sitting Fees paid during 2005-2006

(Rs. In Millions)
Shailesh Haribhakti 0.26
Darlie Koshy 0.24
S. Doreswamy 0.29
Anju Poddar 0.12
Anil Harish 0.18
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Compensation of Directors
For the year ended March 31, 2006, the Company paid an aggregate compensation including sitting fees to
its Directors of Rs. 1.09 million.
Directors’ Interest
The total interests of the Directors in the Company’s Equity Shares as of September 30, 2006 are as
discussed below.
Name of the Shareholder Equity Shares held as of September 30, 2006

Kishore Biyani 4,207,665
Gopikishan Biyani 852,075
Rakesh Biyani 966,875
All the Directors, including Independent Directors, may be deemed to be interested to the extent of fees, if
any, payable to them for attending meetings of the Board or a Committee thereof as well as to the extent of
other remuneration or commission and reimbursement of expenses payable to them under the Articles of
Association. The Wholetime Directors will be interested to the extent of remuneration paid to them for
services rendered as officers or employees of the Company. All the directors, including Independent
Directors, may also be deemed to be interested to the extent of Equity Shares, if any, already held by or that
may be subscribed for and allotted to them.
The Directors may also be regarded as interested in the shares, if any, held by or that may be subscribed by
and allotted to the companies, firms and trust, in which they are interested as Directors, Members, partners
and/or trustees.
All Directors may be deemed to be interested in the contracts, agreements/arrangements entered into or to
be entered into by the Company with any Company in which they hold Directorships or any partnership
firm in which they are partners as declared in their respective declarations. Except as stated otherwise in
this Placement Document and statutory registers maintained by the Company in this regard, the Company
has not entered into any contract, agreements or arrangements during the preceding two years from the date
of the Placement Document in which the directors are interested directly or indirectly and no payments
have been made to them in respect of these contracts, agreements or arrangements which are proposed to be
made to them.
Corporate Governance
Our corporate governance policies recognise the accountability of the Board and the importance of making
the Board transparent to all its constituents, including employees, customers, investors and the regulatory
authorities, and to demonstrate that the shareholders are the ultimate beneficiaries of our economic
activities.
Our corporate governance framework is based on an effective independent board, the separation of the
board’s supervisory role from the executive management and the constitution of board committees,
generally comprising a majority of independent directors and chaired by an independent director, to oversee
critical areas and functions of executive management.
Our corporate governance philosophy encompasses not only regulatory and legal requirements, such as the
terms of listing agreements with stock exchanges, but also several voluntary practices aimed at a high level
of business ethics, effective supervision and enhancement of value for all shareholders. The Board of
Directors also functions through various committees such as the Audit Committee, the Remuneration and
the Shareholders’ Grievances Committee. These committees meet on a regular basis.
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There are three Board Level Committees in our Company, which have been constituted and function in
accordance with the relevant provisions of the Companies Act, 1956 and the Listing Agreement. These are
the (i) Audit Committee, (ii) Remuneration Committee and (iii) Investor Grievance Committee. A brief on
each Committee, its scope, composition and meetings for the current year is given below:
(i) Audit Committee
The Audit Committee comprises of Shailesh Haribhakti (Chairman), S. Doreswamy and Darlie Koshy.
Shiraj Dej has been appointed as the Secretary of the Audit Committee in terms of Clause 49 of the Listing
Agreement. The scope of the Audit Committee in companies is defined under Clause 49 of the Listing
Agreement dealing with Corporate Governance and the provisions of the Companies Act, 1956. The Audit
Committee of our Company oversees, assesses and reviews the audit functions. The Audit Committee
reviews the Company’s financial statements, monitors adequacy and effectiveness of internal controls,
oversees the Audit Function and monitors the external auditors’ independence, objectivity and
effectiveness. Apart from providing direction to the general audit function, the Committee also oversees the
operation of the total audit function in our Company, which includes the organization, operationalisation
and quality control of internal audit & inspection within the Company, follow-up on the statutory / external
audit of our Company.
(ii) Compensation Committee
The Compensation Committee comprises of S. Doreswamy (Chairman), Darlie Koshy and Bala
Deshpande. The Compensation Committee has been set up to review the overall compensation
structure and related policies with a view to attract, motivate and retain employees. The Committee
determines our Company’s policies on remuneration packages payable to the Directors including
performance bonus, perquisites and review the compensation levels vis-à-vis other companies and the
industry in general.
(iii) Investor Grievances Committee
The Investor Grievances Committee comprises of S. Doreswamy (Chairman), Gopikishan Biyani and
Rakesh Biyani. The Committee was constituted in terms of the mandatory requirement of Clause 49 of
the Listing Agreement to look into the redressal of grievances of investors like non receipt of share
certificates, non-receipt of balance sheet, non-receipt of dividend warrants etc.
POLICY ON DISCLOSURES AND INTERNAL PROCEDURE FOR PREVENTION OF INSIDER

TRADING
Regulation 12 (1) of the SEBI (Prohibition of Insider Trading) Regulations, 1992 applies to us and our
employees and requires us to implement a code of internal procedures and conduct for the prevention of
insider trading. We have already implemented an employee trading policy in line with the SEBI guidelines
in this regard.
SENIOR MANAGEMENT
In addition to our Board of Directors as set forth above, the following form part of our senior management.
Ved Prakash Arya, 36, is Director - Operations and Chief Operating Officer. He is an Engineer and has
done his Masters in Business Administration from the Indian Institute of Management, Ahmedabad after
which he went to France on a one year research scholarship in International Marketing. He has over ten
years of work experience. He started his career with Hathway Investments Limited and has worked for
ASIANET and H&R Johnson in various capacities. His previous assignment prior to joining PRIL was
with GLOBUS as Chief Executive Officer. During the last FY he was paid a gross remuneration of Rs.
12,119,573.
Page 77 of 144
Chandra Prakash Toshniwal, 40, Head - Corporate Planning, joined the Company in May 1997. He has
earlier worked with Donear Synthetics Limited, Orient Vegetexpo Limited and Control Print India Limited.
He has 15 years of experience. He is a Chartered Accountant and Company Secretary by qualification.
During the last FY he was paid a gross remuneration of Rs. 3,493,599.
Damodar Mall, 43, President, Food Division, joined the Company in February 2005. He has earlier
worked with Hindustan Lever Limited. He has 19 years of experience. He is an Engineer with a Diploma in
Business Management from the Indian Institute of Management, Bangalore. During the last FY he was paid
a gross remuneration of Rs. 3,716,650.
Sanjay Jog, 45, Head - Human Resource, joined the Company in July 2005. He has earlier worked with
DHL Limited, Taj Hotels Group and RPG Enterprise. He has over 23 years of experience in the field of
human resource. He has done his Masters in Human Resource. His gross remuneration is Rs. 3,816,328
Krishankant Rathi, 43, Chief Financial Officer, joined the Company in January 2005. He has earlier
worked with Macneil & Mayor Limited, Bihar Alloys & Steels Limited, Universal Can & Containers, KBC
International Limited and H & R Johnson (India) Limited. He has 21 years of experience. He is a Chartered
Accountant and Company Secretary by qualification. During the last FY he was paid a gross remuneration
of Rs. 3,454,087
Sanjeev Agrawal, 40, President Marketing, joined the Company in May 2003. He has earlier worked with
Hindustan Lever Limited, P & G, Godrej Soaps, Modi Revlon and Balsara Home Products Limited. He has
20 years of experience. He is an Engineer and done his PGDM from the Indian Institute of Management,
Lucknow. During the last FY he was paid a gross remuneration of Rs. 4,194,265
Chinar Deshpande, 36, Chief Technology Officer (Information Technology), joined the Company in May
2004. He has earlier worked with Dodsal Private Limited, Hindustan Lever Limited, William M Mercer
(USA) and Crompton Greaves Limited. He has 12 years of experience. He is an Engineer and has done his
Masters in Business Administration and a Masters in Science from the University of Louisville, USA.
During the last FY he was paid a gross remuneration of Rs.4,483,992 .
Bina Mirchandani, 52, Head - Pantaloon Category Management, joined the Company in September 2001.
She has earlier worked with Global Clothing, Weekender and Indian Designs. She has 25 years of
experience. She has done her Masters in Management Studies from Jamnalal Bajaj Institute of Management
Studies, Mumbai and has a Certificate in Interior Design. During the last FY she was paid a gross
remuneration of Rs 3,445,088.
Rajan Malhotra, 37, Head - Big Bazaar Category, joined the Company in February 2000. He has earlier
worked with Raymond Limited, Design Connection and Niryat-Sam Apparel. He has 16 years of
experience. He has done his Masters in Business Administration from Kurukshetra University. During the
last FY he was paid a gross remuneration of Rs. 2,987,801
Vinay Shroff, 43, Head - Supply Chain, joined the Company in November 2005. He has earlier worked
with PPG Mazer, Hindustan Lever Limited Reliance Industries Limited and Reliance Infocomm Limited.
He has 20 years of experience. He is an engineer by qualification and has completed his degree from Birla
Institute of Technology, Pilani. During the last FY he was paid a gross remuneration of Rs. 2,168,901
Vishnu Prasad, 45, President - Operations-South Zone and CEO-Central, joined the Company in March
2001. He has earlier worked with Arvind Mills and has 22 years of experience. He has done his Masters in
Business Administration from Pune University. During the last FY he was paid a gross remuneration of Rs.
5,071,727
Kruben Moodliar, 63, President - Value Retail Operations-, joined the Company in May 2006. He has
earlier worked with Pepsi Cola, Africa, Fisons Fertilizer, Shoprite, Jame Discounts and RPG Enterprises.
He has 39 years of experience. He has done his Post Graduate Retail Distribution from Cape Town
University. During the last FY he was paid a gross remuneration of Rs. 1,275,864
Page 78 of 144
Prashant Desai, 34, Head- Group IR & Investor Relations (PE), joined the Company in May 2005. He has
earlier worked with SS Kothari & Company, United Credit Securities Limited and Trisys Communications
Private Limited. He has 14 years of experience. He is an Associate Chartered Accountant and Certified
Public Accountant by qualification. During the last FY he was paid a gross remuneration of Rs. 2,656,304.
Interest of our Senior Management
None of our Senior Management holds any equity shares in our Company except as disclosed below:
No. of Equity Shares held as of
September 30, 2006
Name of Key Managerial Personnel
Rajan Malhotra 2,415
Sanjeev Agrawal 5,500
Bina Mirchandanai 3,750
Transactions with Senior Management
There have been no transactions during the current or previous fiscal year between any of our senior
management and us, which, because of their unusual nature or the circumstances in which they have been
entered into, are or should be required to be disclosed in our accounts or approved by our shareholders and
there are no such transactions during an earlier fiscal year which remain in any respect outstanding or
unperformed.
Page 79 of 144
ORGANISATIONAL STRUCTURE AND PRINCIPAL SHAREHOLDERS
Our Company was incorporated on October 12, 1987 as Manz Wear Private Limited. Our Company was
converted into a public limited company on September 20, 1991 and on September 25, 1992 the name was
changed to Pantaloon Fashions (India) Limited. In the same year we made an initial public offering. We
later changed our name to Pantaloon Retail (India) Limited on July 7, 1999.
The Registered Office of the Company was shifted from Venkatesh Bhavan ,4th Floor, 86 Mirza Street,
Mumbai 400003 to Pantaloon House, G 11, M.I.D.C. Cross Road A, Andheri East, Mumbai 400 093 and
subsequently shifted to its current Registered Office at Pantaloon Knowledge House, Shyam Nagar, Off.
Jogeshwari Vikhroli Road, Jogeshwari (East), Mumbai 400 060.
The Equity Shares of our Company were first listed on the BSE, DSE and ASE, on July 30, 1992.
Thereafter, the Equity Shares were listed on the NSE on February 20, 2001. Pursuant to a voluntary
application by the Company dated August 16, 2006 to the ASE, the ASE by their letter dated November 2,
2006 agreed to de-list the Equity Shares of the Company with effect from November 6, 2006.
We started our operations by selling branded garments under the Pantaloon, Bare and John Miller brands
and set up our first menswear Pantaloon Shoppe Outlet in 1993.
Our Principal Shareholders
The following table contains information as of September 30, 2006 concerning the ownership of our Shares
by our Promoters and each person who we know beneficially owns 1% or more of our Equity Shares.
The promoter of our Company is Kishore Biyani.
The following table contains information as of September 30, 2006, concerning the ownership of our
Equity Shares by our Promoters and each person who we know beneficially owns 1% or more of our
Equity Shares as adjusted to reflect the stock split to Rs. 2 per Equity Share.
As at September 30, 2006
Total no. of
Total shareholding as
Total no. of shares held in
Category of shareholder No. of shareholders a % of total no. of
shares dematerialized
shares
form
As a % of As a % of
(A+B) (A+B+C)
(A) Shareholding of Promoter and promoter
group
(1) Indian
Individuals / Hindu Undivided Family 21 15,648,385 15,648,385 11.64 11.64
Bodies Corporate 5 32,235,675 32,235,675 23.98 23.98
Any Others (Specify) - - -
Partnership Firms 6 11,590,470 11,590,470 8.62 8.62
Sub Total 32 59,474,530 59,474,530 44.24 44.24
(2) Foreign
Total shareholding of Promoter and promoter
32 44.24 44.24
group (A) 59,474,530 59,474,530
(B) Public Shareholding
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(1) Institutions
Mutual Funds / UTI 43 8,618,210 8,617,710 6.41 6.41
Financial Institutions / Banks 1 60,705 60,705 0.05 0.05
Insurance Companies 1 233,045 233,045 0.17 0.17
Foreign Institutional Investors 65 37,976,080 37,976,080 28.25 28.25
Sub Total 110 46,888,040 46,887,540 34.88 34.88
(2) Non-Institutions
Bodies Corporate 672 9,727,265 9,719,360 7.24 7.24
Individuals
Individual shareholders holding nominal
15788 6.22 6.22
share capital up to Rs. 1 lakh 8,363,505 6,331,795
Individual shareholders holding nominal
33 7 7
share capital in excess of Rs. 1 lakh 9,409,295 9,409,295
Any Others (Specify) - - -
Clearing Members 107 82,620 82,620 0.01 0.01
Directors & their Relatives & Friends 1 2,500 - -
Non Resident Indians 199 476,150 474,150 0.4 0.4
Sub Total 16800 28,061,335 26,017,220 20.88 20.88
Total Public shareholding (B) 16910 74,949,375 72,904,760 55.76 55.76
Total (A)+(B) 16942 134,423,905 132,379,290 100 100

(C) Shares held by Custodians and against
- - -
which Depository Receipts have been issued
Total (A)+(B)+(C) 16942 134,423,905 132,379,290 - 100
Quarter: September 2006
Statement showing Shareholding of persons belonging to the category

"Promoter and promoter group"
Sr.
Name of the shareholder No. of shares Shares as a % of total number of shares
No.
1 Kishore Biyani 4207,665 3.13
2 Gopikishan Biyani 852,075 0.63
3 Laxminarayan Biyani 959,910 0.71
4 Vijay Biyani 582,200 0.43
5 Sunil Biyani 869,275 0.65
6 Anil Biyani 974,075 0.72
7 Rakesh Biyani 966,875 0.72
8 Godavaridevi Biyani 230,000 0.17
9 Santosh Biyani 1,205 0
10 Sangeeta Biyani 30,780 0.02
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11 Lata Biyani 605 0
12 Sampat Biyani 168,000 0.12
13 Ashni Biyani 28,365 0.02
14 Kishore Biyani HUF 1,578,305 1.17
15 Gopikishan Biyani HUF 641,775 0.48
16 Laxminarayan Biyani HUF 641,775 0.48
17 Vijay Biyani HUF 682,825 0.51
18 Sunil Biyani HUF 600,000 0.45
19 Anil Biyani HUF 682,825 0.51
20 Rakesh Biyani HUF 600,000 0.45
21 Vivek Biyani 349,850 0.26
22 Gopikishan Biyani – HUF 3,951,500 2.94
23 Laxminarayan Biyani HUF 2,832,470 2.11
24 Anil Biyani 3,349,500 2.49
25 Kishore Biyani 315,000 0.23
26 Laxminarayan Biyani 450,000 0.33
27 Gopikishan Biyani 692,000 0.51
28 PFH Entertainment Limited 7,570,285 5.63
29 Pantaloon Industries Limited 10,164,405 7.56
30 Varnish Trading Private Limited 5,183,420 3.86
31 Manz Retail Private Limited 8,714,070 6.48
32 Dhruv Synthetics Private Limited 603,495 0.45
Total 59,474,530 44.24
Quarter: September 2006

Statement showing Shareholding of persons belonging to the category
"Public" and holding more than 1% of the total number of shares
Sr.
Name of the shareholder No. of shares Shares as a % of total number of shares
No.
1 Citigroup Global Markets Mauritius 5,051,045 3.76
2 BSMA Limited 1,475,600 1.1
3 Jhunjhunwala Rekha Rakesh 2,280,895 1.7
Morgan Stanley & Company
4 4.96
International 6,673,165
5 Deutsche Securities Mauritius Limited 1,907,830 1.42
American Funds Insurance Series
6 1.86
Global 2,500,000
7 Smallcap World Fund Inc 6,500,000 4.84
8 Laxmin Shivanand Mankekar 2,154,480 1.6
9 Pivotal Securities Private Limited 1,381,860 1.03
10 Morgan Stanley Investment Inc 1,452,500 1.08
11 Bennett Coleman & Company Limited 5,721,915 4.26
Total 37,099,290 27.6
Summary of Key Agreements
We have detailed below the key provisions of certain agreements for acquisitions, strategic investments and
divestments.
Acquisitions, strategic investments and disinvestments
Galaxy Entertainment Corporation Limited
Page 82 of 144
On March 4, 2005, we entered into a joint venture with Galaxy Entertainment Corporation Limited
(“Galaxy”), a company engaged in the business of leisure and entertainment, running restaurants/food
courts and bowling alleys to combine our business models. Our Company has acquired 15.73 % stake in
Galaxy by way of an open offer under the Securities and Exchange Board of India (Substantial Acquisition
of Shares and Takeovers) Regulations 1997.
Planet Retail Holdings Private Limited
We have entered into a joint venture agreement with Magnus Fashion Tradelinks Private Limited
(“Magnus”) and Planet Retail Holdings Private. Limited (formerly known as Planet Sports Private Limited)
(“PRHPL”) on February 2, 2005. We have a 49% equity stake in PRHPL. The company’s subsidiary
Supreme Trade Links Limited is the exclusive franchisee for Marks & Spencer stores in India. The
company operates retail stores chains like Planet Sports, Guess and Women’s Secret stores.
Talwalkar Better Value Fitness Private Limited
The Company has entered into a joint venture agreement in October 2006 with Talwalkar Better Value
Fitness Private Limited (“Talwalkars”). The joint venture company will be called “Talwalkar Pantaloon
Retail Private Limited” and its main business will be the development, promotion and retail sale of health
and fitness products under the brand “Roots” and the large scale provision of health and fitness related
services in the territory of India. The joint venture company will also set up gymnasiums and fitness centres
and spas. PRIL and Talwalkars will each hold 50% of the equity shares of the joint venture company.
Participatie Maatschappij Graafsschap Holland NV (Generali Group, Italy)
On May 23, 2006, the Company entered into a joint venture agreement (“JVA-1”) with the Generali Group,
Italy (“Generali”) and Shendra Infrastructure Development Limited (“Shendra”). The joint venture
company incorporated pursuant to JVA-1 will be called “Future Generali India Insurance Company
Limited”. The business under the agreement with Shendra relates to non-life insurance activities;
distribution of the non-life insurance products and other financial products similar thereto and relating to
non-life insurance business. Of the total shareholding, Generali and its affiliates will hold 25.5% of the
share capital; PRIL will hold 25.5% of the share capital and Shendra will hold 49% of the company under
JVA-1.
On May 23, 2006, the Company entered into a joint venture agreement (“JVA-2”) with the Generali Group,
Italy (“Generali”) and Sain Marketing Network Private Limited (“Sain”). The joint venture company
incorporated pursuant to JVA-2 will be called the “Future Generali India Life Assurance Company
Limited”. The business under the agreement with Sain relates to life insurance activities based on
international business practices, management and technology through Future Generali India Life Assurance
Company Limited; distribution of the life insurance products and other financial products similar thereto
and relating to life insurance business. Of the total shareholding, Generali and its affiliates will hold 25.5%
of the share capital; PRIL will hold 25.5% of the share capital and Sain will hold 49% of the company
under JVA-2.
CapitaLand Limited
PRIL has entered into a “Heads of Agreement” on April 19, 2006 with CapitaLand Limited (“CG”),
CapitaLand Retail Limited, Singapore (“CR”) and Horizon Reality Fund LLC, Mauritius. The purpose of
the agreement is to establish or cause establishment of a mall management company (“MMC”) in India and
set up and promote a new fund which will focus on long term ownership of retail properties and retail-led
properties which are under construction to be constructed by companies, entities in which Horizon or
Kshitij Venture Capital Fund (set up by PRIL as an umbrella real estate venture capital fund in India) have
invested. PRIL and its affiliates will hold 50% of the equity shares of the MMC while CG, CR and its
affiliates will hold 50% of the equity shares of MMC.
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Gini & Jony Apparel Private Limited
On March 17, 2006 the Company entered into a joint venture with Gini & Jony Apparel Private Limited
(“G&J”). The joint venture company will be called GJ Future Fashions Limited (“GJ Future fashions”) and
it has been established for the purpose of establishing (i) a chain of dedicated lifestyle exclusive brand
outlets in India (“EBOs”), (ii) shop-n-shop in Pantaloon departmental stores and (iii) shop-n-shop in central
departmental stores, all three formats in the name of “Gini & Jony, Freedom Wear”, for various products
under the three trademarks, namely, (a) “Gini & Jony Freedom Wear”, (b) “GJ Jeans Unltd” and (c) “Palm
Tree” (“G&J Brands). The parties entered into a memorandum of understanding (“MoU”) on January 19,
2006 setting out the broad terms and conditions governing the proposed joint venture. The MoU provides
that G&J shall enter into a license agreement with PRIL for an exclusive right to use the brand name “Gini
& Jony Freedom Wear”. The MoU also provides for a three year exclusivity period between G&J and PRIL
for setting up EBOs in India. PRIL and G&J, either on their own or through their affiliates will hold equal
paid-up equity share capital in GJ Future Fashions.
Home Solution Retail (India) Limited
We have diluted our holding in Home Solution Retail (India) Ltd. (“HSRIL”) , from 100% to 73.32% (pre
conversion of warrants) by selling shares to India Growth Fund, a unit scheme of Kotak SEAF India Fund
(“IGF”), vide share purchase agreement (the “SPA”) dated October 25, 2006 and fresh issue and allotment
of equity shares to India Advantage Fund (“IAF”) vide share holders agreement dated October 26, 2006
with Western India Trustee and Executor Company Limited, ICICI Venture Funds Management Company
Limited (“ICICI Venture”), India Growth Fund (“IGF”) and Home Solutions Retail (India) Ltd., Further
our Board has announced that we shall be subscribing to 3 million convertible warrants of HSRIL. Post
conversion of these warrant we shall hold 76.38% in HSRIL.
Blue Foods Private Limited
On August 25, 2006, PRIL entered into an agreement with Blue Foods Private Limited (“Blue Foods”) and
PAN India Food Solutions Private Limited (“PAN”). The main objective of PAN is to, inter alia, set up
new restaurants and food chains under the Blue Food brands and establish various retail concepts across
customer segments in food and restaurant arena and enter into tie-ups with international brands and food
chains for setting up these in India. PAN shall enter into an exclusive brand/trademark license agreement
with Blue Foods for use in perpetuity of Blue Foods Brands. PRIL and Blue Foods shall each hold 50% of
the paid up equity share capital of PAN.
Manipal Health Systems Private Limited
Manipal Health Systems Private Limited (“MHS”) and PRIL have entered into a Memorandum of
Understanding (“MoU”) dated August 5, 2006. Under the MoU, MHS and PRIL have decided to form a
joint venture company (“JVC”) which will be engaged in retail activities relating to healthcare services and
products in modern retail environments. The JVC will manage the business consisting of some existing
retail brands belonging to PRIL and MHS, namely, “Tulsi” and “Manipal Pharmacy” as also new brands to
be developed by either party, excluding any pharmacy operations in hospitals owned or managed by MHS
and Manipal Academy of Higher Education. PRIL and MHS will each hold 50% of the equity shares of the
JVC.
Alpha Airports Group
Alpha Airports Group (“Alpha”) and PRIL have entered into a Memorandum of Understanding (“MoU”)
dated September 27, 2006 to form a 50:50 joint venture (“JV”) company within sixty days. The trading
name of the JV company will be ‘Alpha Future’. The MoU confirms the mutual understanding of Alpha
and PRIL to form a JV company in India to bid for and undertake the operation of travel retail businesses
such as airport retailing and food and beverage catering in domestic and international terminals, arrivals as
well as departures at India airports, subject to regulatory approval.
Page 84 of 144
Ruchi Soya Industries
PRIL has signed a non-binding letter of intent with Ruchi Soya Industries and its affiliates (“Ruchi”).
Under the provisions of the letter of intent, PRIL will distribute certain products manufactured and
marketed by Ruchi. PRIL and Ruchi will work together to form a joint venture company which shall
develop, package and brand co-branded products. Ruchi will also pack edible oils, soya food and dairy
products on the specifications given by PRIL for PRIL’s private brands.
Future Ideas Company Limited
PRIL entered into a license agreement with Future Ideas Company Limited (the “Licensor”) on October 14,
2006 for the use of the trademark and logo appearing on the cover page of this document. The Licensor is
the author and owner of a copyright of a logo of a flying bird with a punch line ‘Rewrite Rules Retain
Values’ and the owner of the trademark in the name of ‘Future Group’ (the “Logo”). The Licensor has
agreed to grant a license to PRIL to use its copyright and a right in respect of the Logo for a period of one
year from October 15, 2006 to October 14, 2007 and the period mutually agreed to by the parties thereafter.
The rights with respect to the Logo entail the right to reprint and republish the said Logo from time to time
in the same form and without making any modifications with the right to circulate copies on a payment by
PRIL of royalty of 0.05% of gross turnover of PRIL.
Page 85 of 144
ISSUE PROCEDURE
Below is a summary intended to present a general outline of the procedure relating to the bidding,
payment, allocation and allotment of Equity Shares. The procedure followed in the Issue may differ from
the one mentioned below and the investors are assumed to have appraised themselves of the same from the
Company or the Sole Book Runner. The investors are advised to inform themselves of any restrictions or
limitations that may be applicable to them.
Qualified Institutional Placements
The Issue is being made in reliance upon Chapter XIII-A of the SEBI Guidelines through the recently
introduced mechanism of Qualified Institutional Placements (“QIP”) wherein a listed company may issue
and allot Equity Shares/ Fully Convertible Debentures/ Partly Convertible Debentures or any other security
(excluding warrants) on a private placement basis to Qualified Institutional Buyers (“QIBs”) as defined in
clause 2.2.2B (v) of the SEBI Guidelines and below.
The Company has applied for and received the approval of the Stock Exchanges under Clause 24 (a) of the
listing agreements. The Company has also filed a copy of the Preliminary Placement Document with the
Stock Exchanges.
Issue Procedure
1. The Company and the Sole Bookrunner shall circulate the Preliminary Placement Document either
in electronic form or physical form to the QIBs.
2. The Sole Bookrunner shall deliver to the QIBs a Bid Form. Such Bid Form shall either be in
electronic form or in physical form and shall be serially numbered and circulated to a maximum of
49 QIBs. The list of QIBs to whom the Bid Form is delivered shall be determined by the Company
and the Sole Bookrunner in their absolute discretion. Only QIBs that receive the Bid Form are
invited to participate in this Issue.
3. QIBs may submit the Bids (including the revision of Bids) through the Bid Form during the
bidding period to the Sole Bookrunner.
4. QIBs would have to indicate the following in the Bid:
a. Name of the QIB to whom Equity Shares are to be allotted;

b. Number of Equity Shares that such QIB is offering to subscribe for; and
c. Price at which they offer to subscribe for the Equity Shares, provided that QIBs may also
indicate that they are agreeable to submit a Bid at “Cut-off Price” which shall be any price as
may be determined by the Company in consultation with Sole Bookrunner at or above the Floor
Price;
5. The Bid Closing Date shall be notified to the Stock Exchanges and the QIBs shall be deemed to
have been given notice of the same.
6. Based on the Bids received, the Company shall decide the Issue Price which shall be at or above
the Floor Price and the number of Equity Shares to be issued in consultation with the Sole
Bookrunner. The Company shall notify the Stock Exchanges of the Issue Price. On determining
the Issue Price and the QIBs to whom Allocation shall be made, such QIBs shall be sent the
Confirmation of Allocation Note (“CAN”). Upon sending the CAN to the QIBs to whom the
Allocation shall be made, the Bid Form shall be deemed to be the application for subscription to
the Issue. The CAN shall contain details like the number of Equity Shares allocated to the QIB
and payment instructions including the details of the amounts payable by the QIB for Allotment of
Page 86 of 144
the Equity Shares in its name and the Pay-In Date as applicable to the respective QIB. The
decision of the Company and the Sole Bookrunner in this regard shall be at their sole and absolute
discretion. The eligible QIBs shall also be sent a serially numbered Placement Document either in
electronic form or by physical delivery.
7. Pursuant to receiving the CAN the QIBs would have to make the payment of application monies,
by high value cheques or through electronic transfer for the application monies to the designated
bank account of the Company by the Pay- In Date as specified in the CAN sent to the respective
QIBs.
8. Upon receipt of the application monies from the QIBs the Company shall issue and allot the
Equity Shares to the QIBs as per the details provided in the CAN. The Company shall not allot
Equity Shares to more than 49 QIBs. The Company will intimate to the Stock Exchanges the
details of the Allotment.
9. After passing the Allotment resolution and prior to crediting the Equity Shares into the depository
participant accounts of the QIBs, the Company shall apply for in-principle approval of the Stock
Exchanges for listing of the Equity Shares.
10. After receipt of the in-principle approval of the Stock Exchanges, the Company shall credit the
Equity Shares into the depository participant accounts of the QIBs.
11. The Company shall then apply for the final trading and listing permissions from the Stock
Exchanges.
12. The Equity Shares that have been so allotted and credited to the depository participant accounts of
The QIBs shall be eligible for trading on the Stock Exchanges only upon the receipt of final
trading and listing approvals from the Stock Exchanges.
13. The Stock Exchanges shall notify the final trading and listing permissions, which is ordinarily
available on their websites, and the Company shall communicate the receipt of the final trading
and listing permissions from the Stock Exchanges to the QIBs who have been allotted the Equity
Shares. The Company shall not be responsible for any delay or non-receipt of the communication
of the final trading and listing permissions from the Stock Exchanges or any loss arising from such
delay or non-receipt. QIBs are advised to appraise themselves of the status of the receipt of the
permissions from the Stock Exchanges or the Company.
Qualified Institutional Buyers
Only QIBs as defined in clause 2.2.2B (v) of the SEBI Guidelines are eligible to invest. However, non-
residents including FIIs, FVCIs as well as foreign multilateral and bilateral development financial
institutions are not eligible to invest in this Issue. QIBs that are eligible to invest are:
• Public financial institutions as defined in section 4A of the Companies Act, 1956;

• Scheduled commercial banks;
• Mutual funds registered with SEBI (“Mutual Funds”);
• Venture capital funds registered with SEBI;
• State industrial development corporations;
• Insurance companies registered with Insurance Regulatory and Development Authority,
India;
• Provident Funds with minimum corpus of Rs.250 million; and
• Pension Funds with minimum corpus of Rs.250 million.
The Company and the Sole Bookrunner are not liable for any amendments or modification or
Page 87 of 144
changes in applicable laws or regulations, which may occur after the Placement Document is filed
with the Stock Exchanges. QIBs are advised to make their independent investigations and satisfy
themselves that they are eligible to Bid. QIBs are advised to ensure that any single Bid from them
does not exceed the investment limits or maximum number of Equity Shares that can be held by
them under applicable law or regulation or as specified in this Placement Document. Further, QIBs
are required to satisfy themselves that their Bids would not eventually result in triggering a tender
offer under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations.
BIDDING
Bid Form
QIBs shall only use the specified Bid Form supplied by the Sole Bookrunner in either electronic form or by
physical delivery for the purpose of making a Bid (including revision of Bid) in terms of the Preliminary
Placement Document.
By making a Bid (including revision) for Equity Shares pursuant to the terms of the Preliminary Placement
Document, the QIB will be deemed to have made the following representations and warranties:
1. The QIB confirms that it is a Qualified Institutional Buyer (“QIB”) in terms of Clause 2.2.2B (v)
and is eligible to participate in this Issue;
2. The QIB confirms that it is not a Promoter and is not a person related to the Promoters, either
directly or indirectly and its Bid does not directly or indirectly represent the Promoter or promoter
group of the Company;
3. The QIB confirms that it has no rights under a shareholders agreement or voting agreement with
the Promoters or persons related to the Promoters, no veto rights or right to appoint any Nominee
Director on the Board of the Company other than that acquired in the capacity of a lender which
shall not be deemed to be a person related to the Promoters;
4. The QIB has no right to withdraw its Bid after the Bid Closing Date;
5. The QIB shall make payment of application monies to the designated bank account of the
Company by the pay-in date as specified in the CAN sent to the respective QIBs;
6. Upon sending the CAN to the QIBs to whom the Allocation shall be made, the Bid Form shall be
deemed to be the application for subscription to the Issue.
7. The QIB confirms that if allotted Equity Shares pursuant to the Placement Document, the QIB
shall, for a period of one year from allotment, sell the Equity Shares so acquired only on the floor
of the Stock Exchanges; and
8. The QIB confirms that the QIB is eligible to Bid and hold Equity Shares so allotted and together
with any Equity Shares held by the QIB prior to the Issue. The QIB further confirms that the
holding of the QIB, does not and shall not, exceed the level permissible as per any applicable
regulations applicable to the QIB.
9. The QIB confirms that the Bids would not eventually result in triggering a tender offer under the
SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997.
10. That to the best of its knowledge and belief together with other QIBs in the Issue that belong to the
same group or are under common control, the allotment to the QIB shall not exceed 50% of the
Issue Size. For the purposes of this statement:
a. The expression ‘belongs to the same group’ shall derive meaning from the concept of
‘companies under the same group’ as provided in sub-section (11) of Section 372 of the
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Companies Act, 1956;
b. “Control” shall have the same meaning as is assigned to it by clause (c) of Regulation 2
of the Securities and Exchange Board of India (Substantial Acquisition of Shares and
Takeovers) Regulations, 1997.
Submission of Bid Form
QIBS WOULD NEED TO PROVIDE THEIR DEPOSITORY ACCOUNT DETAILS, THEIR

DEPOSITORY PARTICIPANT’S NAME, DEPOSITORY PARTICIPANT IDENTIFICATION
NUMBER AND BENEFICIARY ACCOUNT NUMBER IN THE BID FORM. QIBS MUST
ENSURE THAT THE NAME GIVEN IN THE BID FORM IS EXACTLY THE SAME AS THE
NAME IN WHICH THE DEPOSITORY ACCOUNT IS HELD.
Each scheme /fund of a mutual fund will have to submit separate Bid Forms. Demographic details like
address, bank account etc. will be obtained from the Depositories as per the demat account details given
above.
All Bid Forms shall be duly completed with information including the name of the QIB, the price and the
number of Equity Shares bid. The Bid Form shall be submitted to the Sole Bookrunner either through
electronic form or through physical delivery at the following address:
Name: The Board of Directors

Pantaloon Retail (India) Limited
Address: C/o ENAM Financial Consultants Private Limited,
801, Dalamal Tower, Nariman Point,
Mumbai – 400 021
Contact Person: Mr. G. Venkatesh
Email: pantaloon.qip@enam.com
PRICING AND ALLOCATION
Build up of the Book
The QIBs shall submit their Bids (including the revision of their Bids) through the Bid Form within the
bidding period to the Sole Bookrunner who shall maintain the Book. The Sole Bookrunner shall not be
required to provide any written acknowledgement of the same.
Price discovery and allocation
The Company, in consultation with the Sole Bookrunner, shall finalize the Issue Price which shall be at or
above the Floor Price.
After finalization of the Issue Price, the Company shall update the Preliminary Placement Document with
the Issue details and file the same with the Stock Exchanges as the Placement Document.
Method of Allocation
The Company shall determine the Allocation in consultation with the Sole Bookrunner in compliance with
Chapter XIII-A of the SEBI Guidelines.
Bids received from the QIBs at or above the Issue Price shall be grouped together to determine the total
demand. The Allocation to all such QIBs will be made at the Issue Price. Allocation shall be decided by the
Company in consultation with the Sole Bookrunner on a discretionary basis to a maximum of 49 QIBs.
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Allocation to Mutual Funds for up to a minimum of 10% of the Issue Size shall be undertaken subject to
valid Bids being received at or above the Issue Price.
THE DECISION OF THE COMPANY AND THE SOLE BOOKRUNNER IN RESPECT OF

ALLOCATION SHALL BE BINDING ON ALL QIBS. QIBS MAY NOTE THAT ALLOCATION OF
EQUITY SHARES IS AT THE SOLE AND ABSOLUTE DISCRETION OF THE COMPANY AND
QIBS MAY NOT RECEIVE ANY ALLOCATION EVEN IF THEY HAVE SUBMITTED VALID BIDS
AT OR ABOVE THE ISSUE PRICE. NEITHER THE COMPANY NOR THE SOLE BOOKRUNNER IS
OBLIGED TO ASSIGN ANY REASONS FOR SUCH NON-ALLOCATION.
Number of Allottees
The minimum number of allottees of Equity Shares shall not be less than:
(a) two, where the issue size is less than or equal to Rs.2.5 billion;
(b) five, where the issue size is greater than Rs.2.5 billion.
Provided that no single allottee shall be allotted more than 50% of the issue size.
Provided further that QIBs belonging to the same group or those who are under common control shall be
deemed to be a single allottee for the purpose of this clause. For details of what constitutes “same group” or
“common control” see “Bidding-Bid Form”. THE DECISION OF THE COMPANY AND THE SOLE
BOOKRUNNER IN RESPECT OF ALLOTMENT SHALL BE FINAL AND BINDING ON ALL QIBS.
The maximum number of allottees of Equity Shares shall not be greater than 49 allottees.
CAN
Based on the Bids received, the Company and the Sole Bookrunner will, in their sole and absolute
discretion, decide the list of QIBs to whom the CAN shall be sent. The CAN would include details of the
bank account for transfer of funds if done electronically, Pay- In Date as well as the probable designated
date (“Designated Date”), being the date of credit of the Equity Shares to the investor’s account, as
applicable to the respective QIBs. The dispatch of this CAN forms an irrevocable, binding, non-negotiable
and non transferable obligation on you to acquire the Equity Shares allocated to you and to pay the amount
payable and you will not be entitled to withdraw or cancel or terminate your Bid.
The eligible QIBs shall also be sent a serially numbered Placement Document either in electronic form or
by physical delivery.
QIBs are advised to instruct their Depository Participant to accept the Equity Shares that may be
allocated/allotted to them pursuant to this Issue.
The dispatch of the Placement Document and the CAN shall be deemed a valid, binding and irrevocable
contract for the QIB to pay the entire Issue Price for all the Equity Shares allocated to such QIB.
Bank Account for Payment of Application Money
The Company has opened a special bank account with UTI Bank in terms of the arrangement between the
Company and the Bank. The QIB will be required to deposit the entire amount payable for the Equity
Shares allocated to it by the Pay-In Date as mentioned in the respective CAN.
If the payment is not made favouring the Bank Account within the time stipulated in the CAN, the Bid of
the QIB, the Bid Form and the CAN is liable to be cancelled.
In case of default by the QIBs, the Company and the Sole Bookrunner have the right to reallocate the
Equity Shares at the Issue Price among existing QIBs at their sole and absolute discretion.
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Payment Instructions
• The payment of application money shall be made by the QIBs in the name of “PRIL QIP
account” as per the payment instructions provided in the CAN.
• QIBs may make payment through cheques or electronic fund transfer.
Note: Payment of the amounts through outstation cheques are liable to be rejected. Payments through
cheques should be only through high value cheques payable at Mumbai.
Designated Date and Allotment of Equity Shares
(a) Our Company will endeavour to complete the allotment of Equity Shares by the probable
Designated Date for those QIBs who have paid subscription money as stipulated in the respective
CANs. The Equity Shares will not be allotted unless the QIBs pay the Issue Price in the Bank
Account as stated above.
(b) In accordance with the SEBI Guidelines, Equity Shares will be issued and allotment shall be made
only in the dematerialized form to the allottees. Allottees will have the option to re-materialize the
Equity Shares, if they so desire, as per the provisions of the Companies Act and the Depositories
Act.
(c) The Company reserves the right to cancel the Issue at any time up to Allotment without assigning
any reasons whatsoever.
(d) Post Allotment and credit of Equity Shares into the QIBs Depository Participant account, the
Company would apply for trading/listing approvals from the Stock Exchanges.
(e) The Payment Collection Bank shall not release the monies lying to the credit of the Special
Account to the Company till such time that the Company delivers to the Payment Collection Bank
the approval of the Stock Exchanges for the listing and trading of the Equity Shares offered in this
Issue.
(f) In the unlikely event of the any delay in the Allotment or credit of Equity Shares, or receipt of
trading or listing approvals or cancellation of the Issue, no interest or penalty would be payable by
the Company.
Submission to SEBI
The Company shall submit the Placement Document to SEBI within 30 days of the date of Allotment for
record purposes.
Other Instructions
Permanent Account Number or PAN
Where application(s) is/are for Rs.50,000 or more, the applicant should mention its Permanent Account
Number (PAN) allotted under the I.T. Act. The copy of the PAN card or PAN allotment letter is
required to be submitted with the Bid Form. Applications without this information will be considered
incomplete and are liable to be rejected. It is to be specifically noted that applicant should not submit
the GIR number instead of the PAN as the Bid Form is liable to be rejected on this ground.
Our Right to Reject Bids
The Company, in consultation with the Sole Bookrunner, may reject Bids, , without assigning any reasons
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whatsoever. The decision of the Company and the Sole Bookrunner in relation to the rejection of a Bid
shall be final and binding.
Equity Shares in dematerialized form with NSDL or CDSL
As per the provisions of Section 68B of the Companies Act, the Allotment of Equity Shares in this Issue
shall be only in a de-materialized form, (i.e., not in the form of physical certificates but be fungible and be
represented by the statement issued through the electronic mode).
(a) A QIB applying for Equity Shares must have at least one beneficiary account with either of the
Depository Participants of either NSDL or CDSL prior to making the Bid.
(b) Allotment to a successful QIB will be credited in electronic form directly to the beneficiary
account (with the Depository Participant) of the QIB.
(c) Equity Shares in electronic form can be traded only on the stock exchanges having electronic
connectivity with NSDL and CDSL. All the stock exchanges where our Equity Shares are
proposed to be listed have electronic connectivity with CDSL and NSDL.
(d) The trading of the Equity Shares of the Company would be in dematerialized form only for all
QIBs in the demat segment of the respective stock exchanges.
(e) The Company will not be responsible or liable for the delay in the credit of Equity Shares due to
errors in the Bid Form or on part of the QIBs.
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INDIAN SECURITIES MARKET
The information in this section has been extracted from publicly available documents from various sources,
including officially prepared materials from SEBI, BSE and the NSE, and has not been prepared or
independently verified by us or the Sole Bookrunner, or any of their respective affiliates or advisers.
The Indian Securities Market
India has a long history of organised securities trading. In 1875, the first stock exchange was established in
Mumbai.
Stock Exchange Regulation
India’s stock exchanges are regulated primarily by SEBI, as well as by the Government acting through the
Ministry of Finance, Stock Exchange Division, under the Securities Contracts (Regulation) Act 1956
(‘‘SCRA’’) and the Securities Contracts (Regulation) Rules, 1957 (‘‘SCRR’’), which, along with the rules,
bye-laws and regulations of the respective stock exchanges, regulate the recognition of stock exchanges,
the qualifications for membership and the manner in which contracts are entered into and enforced between
members.
The Securities and Exchange Board of India Act, 1992 granted powers to SEBI to regulate the Indian
securities markets, including stock exchanges and other intermediaries in the capital markets, to promote
and monitor self-regulatory organisations, to prohibit fraudulent and unfair trade practices and insider
trading and to regulate substantial acquisitions of shares and takeovers of companies. SEBI has also issued
guidelines and regulations concerning minimum disclosure requirements by public companies, rules and
regulations concerning investor protection, insider trading, substantial acquisition of shares and takeovers
of companies, buyback of securities, delisting of securities, employee stock option schemes, stockbrokers,
underwriters, mutual funds, foreign institutional investors (‘‘FIIs’’), credit rating agencies and other capital
market participants.
The Central Listing Authority of India (the ‘‘CLA’’) has been set up by SEBI and will begin to address the
issue of multiple listing of the same security across various Indian stock exchanges. It also aims to bring
about uniformity in the due diligence process by scrutinising all listing applications on any stock exchange
in India. The functions of the CLA are enumerated in the SEBI (Central Listing Authority) Regulations,
2003, which, inter alia, include processing the application made by any body corporate, mutual fund or
collective investment scheme, for the letter of recommendation for it to be listed at the stock exchange;
making recommendations as to listing conditions, making suggestions with respect to investor protection
development and regulation of the securities market and disclosures to be made in offering documents and
any other functions that may be specified by SEBI from time to time.
Listing
The listing of securities on recognised Indian stock exchanges is regulated by the SCRA, the SCRR and the
listing agreement of the respective stock exchanges, under which the governing body of each stock
exchange is empowered to suspend trading of or dealing in a listed security for breach of our obligations
under such agreement, subject to our receiving prior notice of such intent of the stock exchange.
A listed company can be delisted under the provisions of the SEBI (Delisting of Securities) Guidelines
2003, which govern voluntary and compulsory delisting of shares of Indian companies from the stock
exchanges. SEBI has the power to direct the amendment of listing agreements and bye-laws of stock
exchanges in India. Any amendment of the bye-laws by the stock exchanges on their own requires the prior
approval of SEBI.
Disclosures under the Companies Act and Securities Regulations
Under the Companies Act, a public offering of securities in India must be made by means of a prospectus,
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which must contain information specified in the Companies Act and the SEBI (Disclosure and Investor
Protection) Guidelines 2000, as amended. The prospectus must be filed with the Registrar of Companies
having jurisdiction over the place where a company’s registered office is situated, which in our case is
currently the Registrar of Companies located in Mumbai. A company’s directors and promoters may be
subject to civil and criminal liability for misrepresentation in a prospectus. The Companies Act also sets
forth procedures for the acceptance of subscriptions and the allotment of securities among subscribers and
establishes maximum commission rates for the sale of securities. SEBI has issued detailed guidelines
concerning disclosure by public companies and investor protection.
Public limited companies are required under the Companies Act and SEBI guidelines to prepare, file with
the Registrar of Companies and circulate to their shareholders audited annual accounts which comply with
the Companies Act’s disclosure requirements and regulations governing their manner of presentation and
which include sections pertaining to corporate governance, Related Party Disclosures and the
management’s discussion and analysis as required under the listing agreement. In addition, a listed
company is subject to continuing disclosure requirements pursuant to the terms of its listing agreement with
the relevant stock exchange. Accordingly, companies are now required to publish unaudited financial
statements (subject to a limited review by our auditors) on a quarterly basis and are required to inform
stock exchanges immediately regarding any stock price-sensitive information.
The Institute of Chartered Accountants of India and SEBI have implemented changes which require Indian
companies to account for deferred taxation, to consolidate their accounts with subsidiaries, to provide
sector reporting, to increase their disclosure of Related Party Disclosures from April 1, 2001 and to account
for investments in associated companies and joint ventures in consolidated accounts and interim financial
reporting from April 1, 2002.
Indian Stock Exchanges
There are now 23 stock exchanges in India. Most of the stock exchanges have their own governing board
for self-regulation. A number of these exchanges have been directed by SEBI to file schemes for
demutualisation as a measure of moving towards greater investor protection.
The BSE and NSE together hold a dominant position among the stock exchanges in terms of the number of
listed companies, market capitalisation and trading activity.
The National Stock Exchange of India Limited
The NSE serves as a national exchange, providing nationwide on-line satellite-linked screen based trading
facilities with an electronic order-based trading system, and electronic clearing and settlement for
securities, including government securities, debentures, public sector bonds and units. The principal aim of
the NSE is to enable investors to buy or sell securities from anywhere in India and to serve as a national
market for securities. Deliveries for trades executed ‘‘on-market’’ are settled through the National
Securities Clearing Corporation Limited. The NSE does not categorise shares into groups as in the case of
BSE, except in respect of the trade-to-trade category. Screen- based paperless trading and settlement is
possible through the NSE from 333 cities in India. The NSE commenced operations in the wholesale debt
market in June 1994, in capital markets in November 1994 and in derivatives in June 2000.
The average daily traded value of the capital market segment was Rs. 69.19 billion as of October 31, 2006.
The NSE launched the NSE 50 Index, now known as S&P CNX NIFTY, on April 22, 1996 and the Mid-
cap index on January 1, 1996. The securities in the NSE 50 Index are highly liquid. The market
capitalisation of the NSE was Rs.31,383.19 billion on October 31, 2006.
The Bombay Stock Exchange Limited
The BSE, the oldest stock exchange in India, was established in 1875. It has evolved over the years into its
present status as the premier stock exchange of India. The BSE switched over to online trading (‘‘BOLT’’)
from May 1995. Only a member of the BSE has the right to trade in the stocks listed on the BSE.
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As of October 31, 2006, there were 4,790 listed companies trading on the BSE. The market capitalisation of
stocks trading on the BSE as on October 31, 2006 was Rs.26,408.86 billion. The average daily turnover
on the BSE was Rs.34.81 billion in October 2006. The BSE has obtained SEBI approval to expand its
BOLT network to more than 400 cities.
Derivatives trading commenced on the NSE in 2000. The BSE has wholesale and retail debt trading
segments. Retail trading in government securities commenced in January 2003.
Takeover Code
Disclosure and mandatory bid obligations for listed Indian companies under Indian law are governed by the
Takeover Code which prescribes certain thresholds or trigger points that give rise to these obligations, as
applicable. The Takeover Code is under constant review by the SEBI and was last amended on May 26,
2006. The Takeover Code prescribes certain thresholds or trigger points that give rise to these obligations.
Certain important provisions of the Takeover Code are as follows:
• Any acquirer (meaning a person who, directly or indirectly, acquires or agrees to acquire
equity shares or voting rights in a company, either by himself or with any person acting
in concert) who acquires equity shares or voting rights that would entitle him to more
than 5%, 10%, 14%, 54% or 74% of the equity shares or voting rights in a company
(together with the company’s equity shares or voting rights, if any, already held by him)
is required to disclose the aggregate of his equity shareholding or voting rights in that
company to the company (which in turn is required to disclose the same to each of the
stock exchanges on which the company’s equity shares are listed) and to each of the
stock exchanges on which the company’s equity shares are listed within two days of (a)
the receipt of allotment information; or (b) the acquisition of equity shares or voting
rights, as the case may be. The term “shares” has been defined under the Takeover Code
to mean equity shares or any other security which entitles a person to acquire shares with
voting rights.
• A person who, together with persons acting in concert with him, holds 15% or more but
less than 55% of the equity shares or voting rights in any company is required to disclose
any purchase or sale representing 2% of the equity shares or voting rights of that
company (together with the aggregate shareholding after such acquisition or sale) to that
company and the stock exchanges on which the company’s equity shares are listed within
two days of the purchase or sale and is also required to make annual disclosure of his
holdings to that company (which in turn is required to disclose the same to each of the
stock exchanges on which the company’s equity shares are listed).
• Promoters or persons in control of a company are also required to make annual disclosure
of their holding in the same manner. The company is also required to make annual
disclosure of holdings of its promoters or persons in control as on March 31 of the
respective year to each of the stock exchanges on which its equity shares are listed.
• An acquirer cannot acquire equity shares or voting rights which (taken together with
existing equity shares or voting rights, if any, held by him or by persons acting in concert
with him) would entitle such acquirer to exercise 15% or more of the voting rights in a
company, unless such acquirer makes a public announcement offering to acquire a further
minimum of 20% of the equity shares of the company at a price not lower than the price
determined in accordance with the Takeover Code. A copy of the public announcement is
required to be delivered, on the date on which such announcement is published, to SEBI,
the company and the stock exchanges on which the company’s equity shares are listed.
• No acquirer who, together with persons acting in concert with him, has acquired, in
accordance with law, 15% or more but less than 55% of the shares or voting rights in a
company, shall acquire, either by himself or through or with persons acting in concert
with him, additional shares or voting rights that would entitle him to exercise more than
5% of the voting rights in any financial year ending March 31, unless such acquirer
makes a public announcement offering to acquire a further minimum of 20% of the
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equity shares of the company at a price not lower than the price determined in accordance
with the Takeover Code.
• An acquirer who, together with persons acting in concert with him, has acquired, in
accordance with law, 55% or more but less than 75% of the equity shares or voting rights
in a company (or, where the company concerned had obtained the initial listing of its
shares by making an offer of at least 10% of the issue size to the public pursuant to Rule
19(2)(b) of the Securities Contracts (Regulation) Rules, 1957 (the “SCRR”), less than
90% of the shares or voting rights in the company) would require such an acquirer to
make an open offer to acquire a minimum of 20% of the shares or voting rights which it
does not already own in the company. However, if an acquisition made pursuant to an
open offer results in the public shareholding in the target company being reduced below
the minimum level required under the listing agreement with the stock exchanges, the
acquirer would be required to take steps to facilitate compliance by the target company
with the relevant provisions of the listing agreement with the stock exchanges, within the
time period prescribed therein.
• Where an acquirer who (together with persons acting in concert) holds 55% or more, but
less than 75% of the shares or voting rights in a target company (or, where the concerned
company had obtained the initial listing of its shares by making an offer of at least 10%
of the issue size to the public pursuant to Rule 19(2)(b) of the SCRR, less than 90% of
the shares or voting rights in the company), intends to consolidate its holdings while
ensuring that the public shareholding in the target company does not fall below the
minimum level permitted by the listing agreement with the stock exchanges, the acquirer
may do so only by making an open offer in accordance with the Takeover Code. Such
open offer would be required to be made for the lesser of (i) 20% of the voting capital of
the company, or (ii) such other lesser percentage of the voting capital of the company as
would, assuming full subscription to the open offer, enable the acquirer (together with
persons acting in concert), to increase the holding to the maximum level possible, which
is consistent with the target company meeting the requirements of minimum public
shareholding laid down in the listing agreement with the stock exchanges.
• In addition, regardless of whether there has been any acquisition of equity shares or
voting rights in a company, an acquirer cannot directly or indirectly acquire control over
a company (for example, by way of acquiring the right to appoint a majority of the
directors or to control the management or the policy decisions of the company) unless
such acquirer makes a public announcement offering to acquire a minimum of 20% of the
voting equity shares of the company. In addition, the Takeover Code introduces the
“chain principle” by which the acquisition of a holding company will obligate the
acquirer to make a public offer to the shareholders of each subsidiary company which is
listed.
The Takeover Code sets out the contents of the required public announcements as well as the minimum
offer price.
The Takeover Code permits conditional offers as well as an acquisition and consequent delisting of the
shares of a company and provides specific guidelines for the gradual acquisition of shares or voting rights.
Specific obligations of the acquirer and the board of directors of the target company in the offer process
have also been specified. Acquirers making a public offer are also required to deposit in an escrow account
a percentage of the total consideration which amount will be forfeited in the event that the acquirer does not
fulfil his obligations.
The general requirements to make such a public announcement do not, however, apply entirely to bailout
takeovers when a promoter (i.e. a person or persons in control of the company, persons named in any offer
document as promoters and certain specified corporate bodies and individuals) is taking over a financially
weak company but not a “sick industrial company” pursuant to a rehabilitation scheme approved by a
public financial institution or a scheduled bank. A “financially weak company” is a company which has at
the end of the previous financial year accumulated losses which have resulted in the erosion of more than
50% but less than 100% of the total sum of its paid up capital and free reserves as at the end of the previous
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financial year. A “sick industrial company” is a company registered for more than five years which has at
the end of any financial year accumulated losses equal to or exceeding its entire net worth.
The Takeover Code, subject to certain conditions specified in the Takeover Code, exempts certain specified
acquisitions from the requirement of making a public offer, including, among others, the acquisition of
shares (1) by allotment in a public issue or a rights issue, (2) pursuant to an underwriting agreement, (3) by
registered stockbrokers in the ordinary course of business on behalf of clients, (4) in unlisted companies,
(5) pursuant to a scheme of reconstruction or amalgamation, (6) pursuant to a scheme under Section 18 of
the Sick Industrial Companies (Special Provisions) Act, 1985, (7) resulting from transfers between
companies belonging to the same group of companies or between promoters of a publicly listed company
and relatives, (8) by way of transmission through inheritance or succession, (9) resulting from transfers by
Indian venture capital funds or foreign venture capital investors registered with SEBI, to promoters of a
venture capital undertaking or venture capital undertaking pursuant to an agreement between such venture
capital funds or foreign venture capital investors with such promoters or venture capital undertaking, (10)
by the Government of India controlled companies, unless such acquisition is made pursuant to a
disinvestment process undertaken by the Government of India or a state government, (11) change in control
by takeover/restoration of the management of the borrower company by the secured creditor in terms of the
Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, (12)
acquisition of shares by a person in exchange of equity shares received under a public offer made under the
Takeover Code and (13) in terms of guidelines and regulations relating to delisting of securities as specified
by SEBI. The Takeover Code does not apply to acquisitions in the ordinary course of business by public
financial institutions either on their own account or as a pledgee. An application may also be filed with the
takeover panel seeking exception from the open offer requirements of the Takeover Code. In addition, the
Takeover Code does not apply to the acquisition of Global Depository Receipts or American Depository
Receipts so long as they are not converted into equity shares carrying voting rights.
Under the Takeover Code, the term “promoter” includes any person who is control of the company or any
person identified as a promoter in any document for the offer of securities to the public or existing
shareholders or in the shareholding information disclosed under the listing agreement, whichever is later, or
any person named as a relating to or belonging to the promoter group as defined under the Takeover Code.
Insider Trading Regulations
The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations 1992 (‘‘Insider
Trading Regulations’’) have been notified by SEBI to prevent insider trading in India by prohibiting and
penalising insider trading in India. The Insider Trading Regulations prohibit an ‘‘insider’’ from dealing,
either on his own behalf or on behalf of any other person, in the securities of a company listed on any stock
exchange when in possession of unpublished price-sensitive information. The terms ‘‘unpublished’’ and
‘‘price-sensitive information’’ are defined in the Insider Trading Regulations. The insider is also prohibited
from communicating, counselling or procuring, directly or indirectly, any unpublished price-sensitive
information to any other person who whilst in possession of such unpublished price-sensitive information
shall not deal in securities. The prohibition under the Insider Trading Regulations also extends to a
company dealing in the securities of a company listed on any stock exchange whilst in the possession of
unpublished price-sensitive information. It is to be noted that recently SEBI has amended the Insider
Trading Regulations to provide certain defences to the prohibition on companies in possession of
unpublished price-sensitive information dealing in securities.
The Insider Trading Regulations make it compulsory for listed companies and certain other entities
associated with the securities market to establish an internal code of conduct to prevent insider trading and
also to regulate disclosure of unpublished price-sensitive information within such entities so as to minimise
misuse of such information. To this end, the Insider Trading Regulations provide a model code of conduct.
Further, the Insider Trading Regulations specify a model code of corporate disclosure practices to prevent
insider trading which must be implemented by all listed companies.
On a continuing basis, under the Insider Trading Regulations, any person who holds more than 5 per cent
of the shares or of the voting rights in any listed company is required to disclose to the company,- the
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number of shares or voting rights held by him and any change in shareholding or voting rights,- (even if
such change results in the shareholding falling below 5 per cent) if there has been change in such holdings
from the last disclosure made, provided such change exceeds 2.0 per cent of the total shareholding or
voting rights in the company. Such disclosure is required to be made within four working days of:
• the receipt of intimation of allotment of the shares; or

• the acquisition or the sale of the shares or voting rights, as the case may be.
Depositories
In August 1996, the Indian Parliament enacted the Depositories Act 1996 (the ‘‘Depositories Act’’) which
provides a legal framework for the establishment of depositories to record ownership details and effect
transfers in electronic book-entry form. SEBI has framed the Securities and Exchange Board of India
(Depositories and Participants) Regulations 1996 which provide for the formation of such depositories, the
registration of participants as well as the rights and obligations of the depositories, participants, the
company, the beneficial owners and the issuers. The depository system has significantly improved the
operations of the Indian securities markets.
Trading of securities in book-entry form commenced in December 1996. In January 1998, SEBI notified
scripts of various companies for compulsory dematerialised trading by certain categories of investors such
as foreign institutional investors and other institutional investors and has also notified compulsory
dematerialised trading in specified scripts for all retail investors. SEBI has subsequently significantly
increased the number of scripts in which dematerialised trading is compulsory for all investors. However,
even in the case of scripts notified for compulsory dematerialised trading, investors, other than institutional
investors, may trade in and deliver physical shares on transactions outside the stock exchange where there
are no requirements to report such transactions to the stock exchange and on transactions on the stock
exchange involving lots of less than 500 securities.
Transfers of shares in book-entry form require both the seller and the purchaser of the equity shares to
establish accounts with depositary participants registered with the depositaries established under the
Depositories Act. Upon delivery, the shares shall be registered in the name of the relevant depositary in our
books and this depositary shall enter the name of the investor in its records as the beneficial owner, thus
affecting the transfer of beneficial ownership. The beneficial owner shall be entitled to all rights and
benefits of a shareholder and be subject to all liabilities in respect of his shares held by a depositary. Every
person holding equity share capital of the company and whose name is entered as a beneficial owner in the
records of the depository is deemed to be a member of the concerned company.
The Companies Act compulsorily provides that Indian companies making any initial public offerings of
securities for or in excess of Rs.100 million should issue the securities in dematerialized form.
Derivatives (Futures and Options)
Trading in derivatives is governed by the SCRA, the SCRA Rules and the SEBI Act. The SCRA was
amended in February 2000 and derivative contracts were included within the term “securities,” as defined
by the SCRA. Trading in derivatives in India takes place either on separate and independent derivatives
exchanges or on a separate segment of an existing stock exchange. The derivative exchange or derivative
segment of a stock exchange functions as a self regulatory organisation under the supervision of the SEBI.
Derivatives products were introduced in phases in India, starting with futures contracts in June 2000 and
index options, stock options and stock futures in June 2000, July 2001 and November 2001, respectively.
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DESCRIPTION OF THE SHARES
Set forth below is certain information relating to our share capital, including a brief summary of some of
the provisions of our Memorandum and Articles of Association, the Companies Act and certain related
legislation of India, all as currently in effect.
General
The authorized capital of our Company is 17,50,00,000 equity shares of Rs. 2 each. The Company has split
one Equity Share of Rs. 10 face value into five Equity Shares of Rs. 2 each pursuant to an AGM resolution
dated November 17, 2006.
Dividend
Under the Companies Act, unless the Board recommends the payment of a dividend, the shareholders at a
general meeting have no power to declare any dividend. Subject to certain conditions laid down in the
Companies Act, no dividend can be declared or paid by a company for any financial year except out of the
profits of the company determined in accordance with the provisions of the Companies Act or out of the
undistributed profits or reserves of previous fiscal years or out of both, arrived at in accordance with the
provisions of the Companies Act. Under our Articles of Association, the shareholders at a general meeting
may declare a lower, but not higher, dividend than that recommended by the Board. Dividends are
generally declared as a percentage of the par value of the shares. The dividend recommended by the Board
and approved by the shareholders at a general meeting is distributed and paid to shareholders in proportion
to the paid-up value of their Shares as at the record date for which such dividend is payable. In addition, the
Board may declare and pay interim dividends. Under the Companies Act, dividends can only be paid in
cash to shareholders listed on the register of shareholders on the date which is specified as the ‘‘record
date’’ or ‘‘book closure date’’. No shareholder is entitled to a dividend while unpaid calls on any of his
Shares are outstanding.
Dividends must be paid within 30 days from the date of the declaration and any dividend that remains
unpaid or unclaimed after that period must be transferred within seven days to a special unpaid dividend
account held at a scheduled bank. Any money that remains unpaid or unclaimed for seven years from the
date of such transfer must be transferred by us to the Investor Education and Protection Fund and thereafter
any claim with respect thereto will lapse.
Under the Companies Act, a company may pay a dividend in excess of 10.0 percent in any year, out of the
profits of that financial year only after it has transferred to its reserves a certain percentage of its profits for
that year ranging between 2.5 per cent and 10.0 per cent depending on the percentage of dividend proposed
to be declared in that year. The Companies Act further provides that if the profit for a year is insufficient,
the dividend for that year may be declared out of accumulated profits from previous years which have been
transferred to reserves, subject to certain conditions prescribed under the Companies Act.
Capitalisation of Reserves/Profits
Article 97 provides that the Company in general meeting may, upon the recommendation of the Board,
resolve: that it is desirable to capitalize any part of the amount for the time being, standing to the credit of
any or the Company’s reserve accounts, or to the credit of the profit and loss account or otherwise available
for distribution as dividend; and that such sum be accordingly set free distribution in the manner specified
in the Article 98 next hereinafter following amongst the members who would have been entitled thereto if
distributed by way of dividends and in the same proportions.
Article 98 provides that the sum so set free as aforesaid shall not be paid in cash but shall be applied subject
to the provisions contained in the Article either in or towards:
a. Paying up any amounts for the time being unpaid on any shares held by such members
respectively; or
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b. Paying up in full unissued shares or debentures of the Company to be allotted and
distributed, credited as fully paid up, amongst such members in proportions as aforesaid;
or
c. Partly in the way specified in sub-clause ‘a’ and partly as specified in sub-clause ‘b’.
Article 99 provides that whenever such a resolution as aforesaid has been passed by the Company, the
Board shall give effect thereto and it shall:
a. Make all appropriations and applications of the undivided profits resolved to be

capitalized thereby and all allotments and issues of fully paid up shares or debentures, if
any, and
b. Generally to all acts and things required to give effect thereto.
Article 100 provides that without prejudice to the foregoing, the Board shall have all powers:
a. To make such provisions by issue to fractional certificates or by payment in cash or

otherwise as it thinks fit, for the cash or shares or debentures becoming distributable in
fractions and also.
b. To authorize any person to enter on behalf of the members entitled thereto, into an
agreement with the Company providing for the allotment to them respectively credited as
fully paid up of any further shares or debentures top which they may be entitled upon
such capitalization, or (as the case may require) for the payment by the Company on their
behalf, by the application thereto of their respective proportions of profits resolved to be
capitalized, of the amounts or any part of the amounts remaining unpaid on their existing
shares. Any such agreement made under such authority shall have effect as if entered into
by the members.
Any issue of bonus shares would be subject to the guidelines issued by SEBI in this regard. The relevant
SEBI guidelines prescribe that no company shall, pending conversion of convertible securities, issue any
shares by way of bonus unless a similar benefit is extended to the holders of such convertible securities,
through a proportionate reservation of shares. Further, in order to issue bonus shares a company should not
have defaulted in the payment of interest or principal in respect of on existing debentures. The declaration
of bonus shares in lieu of a dividend cannot be made. A bonus issue may be made out of free reserves built
out of genuine profits or share premium collected in cash and not from reserves created by revaluation of
fixed assets.
The issue of bonus shares must take place within six months from the date of approval by the Board or the
shareholders, whichever is later.
Pre-emptive Rights and Alteration of Share Capital
Article 11 provides that the Company may from time to time, by ordinary resolution, increase the share
capital by such sum, to be divided into shares of such amount, as may be specified in the said resolution.
Article 12 provides that the Company may, by ordinary resolution, consolidate and divide all or any of its
share capital into shares of larger amount than its existing shares; sub-divide all or any, of its shares or any
of them into shares of smaller amount than is fixed by the memorandum subject nevertheless to the
provisions of clause (d) of sub-section (1) of Section 94 of the Act; cancel any share which, at the date of
the passing of the resolution, has not been agreed to be taken by any person and diminish the amount of its
share capital by the amount of shares so cancelled. Article 13 provides that the Company may, pass by
special resolution reduce in any manner and with subject to any incident authorized and consent required
by law its share capital; any capital redemption reserve fund; any share premium account.
However, under the provisions of the Companies Act, new shares may be offered to any persons whether or
not those persons include existing shareholders, if a special resolution to that effect is passed by the
shareholders of the company in a general meeting. The issue of the Equity Shares has been duly approved
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by a special resolution of our shareholders and such shareholders have waived their pre-emptive rights with
respect to such shares.
Preference Shares
Preference share capital is that part of the paid-up capital of the company which fulfils both the
requirements below:
• That with respect to dividends, it carries or will carry a preferential right to be paid a
fixed amount or an amount calculated at a fixed rate; and
• With respect to capital, it carries or will carry on a winding-up of the company, a
preferential right to be repaid the amount of the capital paid-up or deemed to have been
paid-up, subject to the provisions of the Companies Act.
Preference shares must be redeemed within 10 years of issue. Under the Companies Act, we may issue
redeemable preference shares but:
• no such shares may be redeemed except out of profits otherwise available for dividends
or out of the proceeds of a fresh issue of shares made for the purposes of the redemption;
• no such shares may be redeemed unless they are fully paid;
• the premium, if any, payable on redemption shall have been provided for out of the
company’s profits or share premium account, before the shares are redeemed;
• where any such shares are redeemed otherwise than out of the proceeds of a fresh issue,
there shall, out of profits which would otherwise have been available for dividends, be
transferred to a reserve fund, to be called the Capital Redemption Reserve Account, a
sum equal to the nominal amount of the shares redeemed; and
• the provisions of the Companies Act relating to the reduction of the share capital of a
company shall apply as if such reserve account were paid-up share capital of such
company.
General Meetings of Shareholders
We must hold our annual general meeting each year within 15 months of the previous annual general
meeting unless extended by the Registrar of Companies at our request for any special reason. The Board
may convene an extraordinary general meeting of shareholders when necessary and shall convene such a
meeting at the request of a shareholder or shareholders holding in the aggregate not less than 10 % of our
issued paid-up capital.
Article 48 provides that no business shall be transacted at any general meeting unless a quorum of members
is present at the time when the meeting proceeds to business. Five members present in person shall be the
quorum. Article 52 provides that in the case of an equality of votes, whether on show of hands or on a poll,
the Chairman of the meeting at which the show of hands takes place, or at which poll is demanded, shall be
entitled to a second or casting vote. Article 53 provides that any business other than that upon which a poll
has been demanded may be proceeded with, pending the taking of the poll. Article 55 provides that a body
corporate may be represented at the meeting of the Company in any of the manner set out in Section 187 of
the Act, but in each case either a copy of the resolution of the said body corporate duly certified by one of
its principal officers or the instrument of proxy shall be filed with the Company.
Written notices convening a meeting setting out the date and place of the meeting and its agenda must be
given to members at least 21 days prior to the date of the proposed meeting and where any special business
is to be transacted at the meeting an explanatory statement shall be annexed to the notice as required under
the Companies Act. With the consent of all members entitled to receive notice of a meeting or to attend and
vote at any such meeting which may be given by telegram or cable a meeting may be convened by shorter
notice than that provided by the Act as such members approve. Currently, we give written notices to all
members and, in addition, give public notice of general meetings of shareholders in a daily newspaper of
general circulation in Maharashtra. Our general meetings are held in Mumbai, Maharashtra.
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A company intending to pass a resolution relating to matters such as, but not limited to, an amendment in
the objects clause of the Memorandum, a buy-back of shares under the Companies Act, the giving of loans
or extending a guarantee in excess of limits prescribed under the Companies Act (and guidelines issued
thereunder) may pass the resolution by means of a postal ballot instead of transacting the business in the
general meeting of the company. A notice to all the shareholders must be sent along with a draft resolution
explaining the reasons therefore and requesting them to send their assent or dissent in writing on a postal
ballot within a period of 30 days from the date of such notice.
Voting Rights
Article 56 provides that on a show of hands, every member personally present shall have one vote. On a
poll, every member shall have one vote for each share of which he is a holder. Article 57 provides that in
the case of joint holders, the vote of the senior who tenders a vote, whether in person or by proxy, shall be
accepted to the exclusion of the votes of the joint holders and that for this purpose, seniority shall be
determined by the order in which the names stand in the Register of Members. Article 58 provides that no
member shall be entitled to vote at any general meeting unless all calls or other sums presently payable by
him in respect of shares in the Company have been paid. Article 59 provides that every proxy shall be
appointed in writing in any usual form under hand of the appointer or by an agent duly authorized under a
Power of Attorney or if such appointer is a Company or Corporation under the Common Seal of such
Company or Corporation or the hand of its Attorney. Article 60 provides that the Chairman of any meeting
shall be the sole judge of the validity of every vote tendered at such meeting. The Chairman present at the
taking of a poll shall be the sole judge of the validity of every vote tendered at such poll.
Ordinary resolutions may be passed by simple majority of those present and voting. Special resolutions
require that the votes cast in favour of the resolution must be at least three times the votes cast against the
resolution. The Companies Act provides that to amend the Articles of Association, a special resolution is
required to be passed in a general meeting.
The Companies Act allows us to issue shares with differential rights as to dividend, voting or otherwise,
subject to certain conditions. In this regard, the law requires that for a company to issue shares with
differential voting rights the company must have had distributable profits in terms of the Companies Act
for a period of three financial years and the company must not have defaulted in filing annual accounts and
annual returns for the immediately preceding three years.
Register of Shareholders and Record Dates
We are obliged to maintain a register of shareholders at our Registered Office in Mumbai or at some other
place in the same city. We recognise as shareholders only those persons who appear on the register of
shareholders and cannot recognise any person holding any share or part of it upon any express, implied or
constructive trust, except as permitted by law. In the case of shares held in physical form, transfers of
shares are registered on the register of shareholders upon lodgement of the share transfer form duly
complete in all respects accompanied by a share certificate or, if there is no certificate, the letter of
allotment in respect of shares transferred together with duly stamped transfer forms. In respect of electronic
transfers, the depository transfers shares by entering the name of the purchaser in its books as the beneficial
owner of the shares. In turn, the name of the depository is entered into the company’s records as the
registered owner of the Shares. The beneficial owner is entitled to all the rights and benefits as well as the
liabilities with respect to the Shares.
For the purpose of determining the shareholders, the register may be closed for periods not exceeding 45
days in any one year or 30 days at any one time at such times, as the Board may deem expedient in
accordance with the provisions of the Companies Act. Under the listing agreements of the Stock Exchanges
on which the Company’s outstanding Shares are listed, the Company may, upon at least 15 days’ advance
notice to such stock exchanges, set a record date and/or close the register of shareholders in order to
ascertain the identity of shareholders. The trading of shares and the delivery of certificates in respect
thereof may continue while the register of shareholders is closed.
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Under the Companies Act, the Company is also required to maintain a register of debenture holders.
Annual Report and Financial Results
The Annual Report must be laid before the annual general meeting. .The report includes financial
information, a corporate governance section and management’s discussion and analysis and is sent to the
company’s shareholders.
Under the Companies Act, we must file the Annual Report with the Registrar of Companies within six
months from the close of the accounting year or within 30 days from the date of the annual general
meeting, whichever is earlier. As required under our listing agreements, copies are required to be
simultaneously sent to the stock exchanges on which the Shares are listed. We must also publish our
financial results in at least one English language daily newspaper circulating in the whole or substantially
the whole of India and also in a newspaper published in the language of the region of our Registered
Office.
The Company files certain information on-line, including its Annual Report, six-month and quarterly
financial statements and the shareholding pattern statement, in accordance with the requirements of the
listing agreements and as may be specified by the SEBI from time to time.
Transfer of Shares
Shares held through depositories are transferred in the form of book entries or in electronic form in
accordance with SEBI regulations. These regulations provide the regime for the functioning of the
depositories and their participants and set out the manner in which the records are to be kept and
maintained and the safeguards to be followed in this system. Transfers of beneficial ownerships of shares
held through a depository are exempt from stamp duty.
SEBI requires that for trading and settlement purposes shares should be in book-entry form for all
investors, except for transactions that are not made on a stock exchange and transactions that are not
required to be reported to the stock exchange.
The shares are freely transferable, subject only to the provisions of the Companies Act under which, if a
transfer of shares contravenes the SEBI provisions or the regulations issued under it or the SICA, or any
other similar law, the Company Law Board may, on an application made by the company, a depository
incorporated in India, an investor, SEBI or other parties, direct a rectification of the register of records. If a
company without sufficient cause refuses to register a transfer of shares within two months from the date of
which the instrument of transfer is delivered to the company, the transferee may appeal to the Company
Law Board seeking to register the transfer. The Company Law Board may, in its discretion, issue an
interim order suspending the voting rights attached to the relevant shares before completing its
investigation of the alleged contravention. Under the Companies (Second Amendment) Act 2002, the
Company Law Board will be replaced with the National Company Law Tribunal. Further, under the Sick
Industrial Companies (Special Provisions) Repeal Act 2003, the SICA is sought to be repealed and the
board of Industrial and Financial Reconstruction, as constituted under the SICA, is to be replaced with the
National Company Law Tribunal, set up under the Companies Act.
Pursuant to our listing agreements, in the event that a transfer of shares is not affected within one month or
where we have failed to communicate to the transferee any valid objection to the transfer within the
stipulated time period of one month, we are required to compensate the aggrieved party for the opportunity
loss caused by the delay.
The Companies Act provides that shares or debentures of a public listed company (like ours) shall be freely
transferable. However, our Articles of Association provide for certain restrictions on the transfer of shares,
including granting power to the Board in certain circumstances to refuse to register or acknowledge transfer
of shares or other securities issued by us. Pursuant to Article 27 of our Articles of Association if the
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Directors refuse to register a transfer of any shares, they shall within one month after the date on which the
transfer was lodged with the Company send to the transferor and the transferee notice of the refusal.
A transfer may also be by transmission. Subject to the provisions of the Company’s Articles, any person
becoming entitled to shares in consequence of the death, lunacy, bankruptcy or insolvency of any member
or by any lawful means other than by a transfer in accordance with these presents, may, with the consent of
the Board, upon producing such evidence that he sustains the character in respect of which he proposes to
act under the Article, or his title, as the Board thinks sufficient, be registered as a member in respect of such
shares, or may, subject to the regulations as to transfer contained in the Articles, transfer such shares.
Acquisition by the Company of its own Shares
A company is prohibited from acquiring its own shares unless the consequent reduction of capital is
effected by an approval of at least 75% of its shareholders, voting on it in accordance with the Companies
Act and sanctioned by the High Court of competent jurisdiction. Subject to certain conditions, a company is
prohibited from giving, whether directly or indirectly and whether by means of loan, guarantee, provision
of security or otherwise, any financial assistance for the purpose of or in connection with a purchase or
subscription made or to be made by any person for any shares in the company or its holding company.
However, pursuant to certain amendments to the Companies Act, a company has been empowered to
purchase its own shares or other specified securities out of its free reserves, the securities premium account,
the proceeds of any shares or other specified securities (other than the kind of shares or other specified
securities proposed to be bought back) subject to certain conditions, including:
• the buy-back should be authorised by the Articles of Association of the company;

• a special resolution has been passed by postal ballot authorising the buy-back;
• the buy-back is limited to 25 per cent of the total paid-up capital and free reserves;
• the debt owed by the company is not more than twice capital and free reserves after such
buy-back; and
• the buy-back is in accordance with the Securities and Exchange Board of India (Buy-
Back of Securities) Regulations 1998.
The second condition mentioned above would not be applicable if the buy-back is for less than 10 per cent
of the total paid-up equity capital and free reserves of the company and provided that such buy-back has
been authorised by the Company’s board. A company buying back its securities is required to extinguish
and physically destroy the securities so bought back within seven days of the last date of completion of the
buy-back. Further, a company buying back its securities is not permitted to buy back any securities for a
period of one year from the buy-back or to issue securities for six months.
A company is also prohibited from purchasing its own shares or specified securities through any subsidiary
company including its own subsidiary companies or through any investment company. Further a company
is prohibited from purchasing its own shares or specified securities, if the company is in default in the
repayment of deposit or interest, redemption of debentures or preference shares, in payment of dividend to
a shareholder, in repayment of any term loan or interest payable thereon to any financial institution or bank
or in the event of non-compliance with certain other provisions of the Companies Act.
Liquidation Rights
Subject to the rights of creditors, of employees and of the holders of any other shares entitled by their terms
of issue to preferential repayment over the shares, in the event of winding up of our company, the holders
of the shares are entitled to be repaid the amounts of capital paid-up or credited as paid-up on such shares.
All surplus assets after payments due to employees, the holders of any preference shares and other creditors
belong to the holders of the Shares in proportion to the amount paid-up or credited as paid-up on such
shares respectively at the commencement of the winding-up.
In case assets available are insufficient to repay the whole of the paid up capital, the assets shall be so
distributed such that the losses are borne to the extent possible by the shareholders in the ratio of capital
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contributed. In case any of the shares involve a liability to call or otherwise, any person may, within ten
days after the passing of the resolution, by notice in writing direct the liquidators to sell his portion and pay
him the net proceeds and the liquidator shall, if practicable, act accordingly.
The division of assets on winding up, if thought expedient, may subject to the provisions of the Companies
Act, be otherwise than in accordance with the legal rights of the contributories (except when unalterably
fixed by the Memorandum) and in particular, any class may be given preferential or special rights which
may be excluded altogether or in part but any contributory who is prejudiced by the same have a right to
dissent and possess ancillary rights as though such determination were a special resolution under section
494 of the Companies Act.
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TAXATION
The information provided below sets out the possible tax benefits available to the shareholders under the
current tax laws presently in force in India. The benefits discussed below are not exhaustive. This statement
has been prepared based on a certificate dated November 23, 2006 received from NGS & Company,
chartered accountants. This statement is only intended to provide general information to the investors and is
neither designed nor intended to be a substitute for professional tax advice. In view of the individual nature
of the tax consequences and the changing tax laws, each investor is advised to consult his or her own tax
consultant with respect to the specific tax implications arising out of their participation in the Issue.
Benefits to the Resident shareholders
1. Dividends under section 10(34) of the Act

Dividends (whether interim or final) received by a shareholder from investment in share of a
domestic company would be exempt in the hands of the shareholder as per the provisions of
section 10(34) read with section 115-O of the Act.
2. Computation of capital gains

Capital assets are to be categorized into short-term capital assets and long-tem capital assets based
on the period of holding. All capital assets (except for shares held in a Company or any other
listed securities or units or UTI or units of Mutual Fund or Zero Coupon Bonds) are considered to
be long-term capital assets if these are held for period exceeding twelve months.
Section 48 of the Act, which prescribes the mode of computation of capital gains, provides for
resident shareholders a benefit permitted to substitute the cost of acquisition/improvements. The
indexed cost of acquisition/improvements, adjusts the cost of acquisition/improvements, by a cost
inflation index, as prescribed from time to time.
As per the provisions of section 112 of the Act, long-term capital gains are subject to tax at a rate
of 20% (plus applicable surcharge and cess). However, proviso to section 112(1) specifies that if
the long-term capital gains arising on transfer of listed securities or units calculated at the rate of
20% with indexation benefit exceeds the capital gains computed at the rate of 10% without
indexation benefit, then such capital gains are chargeable to tax at the rate of 10% without
indexation benefit plus applicable surcharge.
Effective October 1, 2004, long-term capital gains arising on sale of equity share and units of
equity oriented mutual fund (as defined under section 10(23D) are exempt from tax under section
10(38) of the Act subject to Securities Transaction Tax being levied under Chapter VII of the
Finance (No.2) Act, 2004.
3. Exemption of capital gains arising from income-tax

As per section 54EC of the Act and subject to the conditions specified therein capital gains arising
to the Company on transfer of a long-term capital asset shall not be chargeable to tax to the extent
such capital gains are invested in certain notified bonds within six months from the date of
transfer. However, if the Company transfer or converts the notified bonds into money (as
stipulated therein) within a period of three years form the date of their acquisition, the amount of
capital gains exempted earlier would become chargeable in such year. The bonds specified for this
section are bonds issued by National Bank for Agriculture and Rural Development (‘NABARD’),
the National Highways Authority of India (‘NHAI’), the National Housing Bank (‘NHB’), the
Rural Electrification Corporation Limited (‘REC’) and Small Industries Development Bank of
India (‘SIDBI’).
As per section 54ED of the Act and subject to the conditions specified therein, long-term capital
gains arising on listed securities or units shall not be chargeable to tax to the extent such capital
gains are invested in acquiring equity shares forming part of an eligible issue of share capital. The
investment is required to be made within six months from the relevant date of transfer. ‘Eligible
issue of capital’ means an issue of equity shares, which satisfies the following conditions:
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a. The issue is made by a public company formed and registered in India; and
b. The shares forming part of the issue are offered for subscription to the public.
There is a legal uncertainty as to whether the benefits under this section fan be extended to shares
forming part of the offer for sale by the existing shareholders. It may be relevant to note that the
Central Board of direct Taxes (‘CBDT’) has clarified vide its Circular No. 7/2003 dated
September 5, 2003, that the term ‘public issue’ in the context of section 10(36) of the Act shall
include the offer of equity shares in a company to the public through a prospectus, whether by the
company or by the existing shareholders of the Company.
Further as per the provisions of section 54F of the Act and subject to conditions specified therein,
long-term capital gains (in cases not covered under section 10(38) of the Act) arising to Individual
or Hindu Undivided Family (‘HUF’) on transfer of shares of the Company will be exempted from
capital gains tax, if the net consideration from such shares are used for purchase of residential
house property within a period of one year before and two years after the date on which the
transfer took place or for construction of residential house property within a period of three years
after the date of transfer, provided that the Individual/HUF should not own more than one
residential house other than the new residential house on the date of transfer .
If the residential house in which the investment has been made is transferred within a period of
three years from the date of its purchase or construction, the amount of capital gains tax exempted
earlier would become chargeable to tax as long-term capital gains in the year in which the
additional residential house is acquired.
Similarly, if the shareholder purchase within a period of two years or constructs within a period of
three years after the date of transfer of capital asset, another residential house, than the original
exemption will be taxed as capital gains in the year in which the additional residential house is
acquired.
4. As per the provisions of section 88E, where the business income of a resident includes profits and
gains from sale of taxable securities, a rebate shall be allowed from the amount of income tax
equal to the securities transaction tax paid on such transaction. However the amount of rebate shall
be limited to the amount arrived at by applying the average rate of income tax on such business
income.
Benefits to the Mutual funds
Dividends exempt under section 10(34) of the Act
Dividends (whether interim or final) received by the Mutual Funds from its investment in shares
of a domestic company would be exempt in the hands of the Mutual Fund as per the provisions of
section 10(34) read with section 115-O of the Act.
As per the provisions of section 10(23D) of the Act any income of Mutual Funds registered
under the Securities and Exchange Board of India Act,1992 or Regulations made there under,
Mutual Funds set up by public sector banks or public financial institutions and Mutual Funds
authorized by the Reserve Bank of India ,would be exempt from income tax, subject to the
prescribed conditions .
Benefits to the Venture Capital Companies/ Funds
Dividends exempt under section 10(34) of the Act
Page 107 of 144

Dividends (whether interim or final) received from investment in shares of another domestic
company would be exempt in the hands of the Venture Capital Company/Fund as per the
provisions of section 10(34) read with section 115-O of the Act.
Income exempt under section 10(23FB) of the Act,
As per the provisions of section 10(23FB) of the Act, any income of Venture Capital
Companies/Funds registered with the Securities and Exchange Board of India would be exempt
from income tax, subject to the conditions specified.
Benefits available under the Wealth tax Act 1957
Asset as defined under section 2(ea) of the Wealth Tax Act, 1957 does not include shares in
companies and hence shares are not liable to Wealth Tax.
Benefits available under the Gift tax Act
Gift tax is not leviable in respect of any gifts made on or after October 1, 1998.Therefore, any gift
of shares will not attract gift tax.
Page 108 of 144

LEGAL PROCEEDINGS
Except as described below, the Company is not involved in any legal proceedings, and no proceedings are
threatened, which may have, or have had, a material adverse effect on the business, properties, financial
condition or operations of the Company. The Company believes that the number of proceedings in which
the Company is involved is not unusual for a company of its size in the context of doing business in India.
1. A complaint no. 229 of 2004 has been filed before the District Consumer Disputes Redressal Forum at
Bandra, Mumbai against the Company and M/s. Tops Detective and Security Services. The complaint
claimed compensation for an amount aggregating to Rs. 0.5 million with interest at the rate of 18 per
cent per annum. for the loss the loss of his laptop on September 6, 2003 from the Big Bazaar outlet
operated by the Company in Mumbai. The complainant alleged deficiency in the services of safe
custody provided by the Company and M/s. Tops Detective and Security Services which lead to the
loss. The Company has filed its reply. The matter is currently pending.
2. B.P. Gupta, a consumer has lodged complaint no. 322/255 in the District Consumer Forum, Ghaziabad
against ‘Shipra Mall’ and the Company for compensation of Rs.1.4 million for injury suffered. B.P.
Gupta had gone for shopping along with his family to “Shipra Mall” at Ghaziabad, and after coming
out of the ‘Food Bazaar’ store towards the lift, he fell down in a pothole near the lift which was not
covered. He further alleged that there was no proper lighting facility and the pothole did not have
necessary safety arrangement. He thus suffered injury and has asked for damages for the same. The
matter is currently pending.
3. Rohit Chandra filed suit no. 70 of 2006 against the Company in the Court of Civil Judge South (Junior
Division) Lucknow for carrying out illegal and unfair trade practices at Big Bazaar, Sahara Ganj,
Lucknow. He has alleged that Big Bazaar is selling different essential commodities at cheaper prices as
compared with other vendors and thereby trying to create a monopoly like situation in the market and
disturbing the sale and working conditions of other local shopkeepers in Lucknow. Further he has also
alleged that Big Bazaar was selling foreign imported goods and items from China and Korea, on which
neither prices were printed nor name of the manufacturer or date of manufacturing of the said product
was mentioned. Rohit Chandra has made an interim application under Order 39 Rule 1 & 2 r/w Section
151 of Civil Procedure Code and sought permanent injunction against the Company for restraining the
latter from operating any business activities of wholesale and retail of any goods and commodities
from and through premises of Big Bazaar. The matter is currently pending.
4. The State of Gujarat has filed C.D.R.F./C.C. no. 22/06 before the District Consumer Redressal Forum,
Ahmedabad against ‘Big Bazaar’ store situated at Sarkhej, Ghandhinagar Highway, Ahmedabad of the
Company for carrying out unfair and restrictive trade practices. It has been alleged that with a view to
increase in the sales, the Company obtained money from the consumers under the guise of entry fee
and thus perpetrated unfair and restrictive trade practice in terms of section 2(1)(b)(3)(n) of the
Consumer Protection Act 1986. It has also been alleged that on January 26, 2006, which was declared
to be ‘Mega Saving Day’ by ‘Big Bazaar’, Big Bazaar kept an entry fee for customers visiting the shop
without any announcement in the advertisement given by it which amounted to "restrictive and unfair
trade practice". The matter is currently pending.
5. A claim has been filed in Suit No. 1533 of 2003 before the Bombay High Court against the Company
and another for restraint from using the trademark “RAYMEN”. The claimant claimed that the
Company aided and abetted the infringement of the said trademark by selling goods manufactured by
the supplier in their stores and sought damages of an amount aggregating Rs. 0.5 million for the
alleged use of the trademark. The court passed an ad-interim order dated June 16, 2003 restraining the
Company from using the said trademark. The matter is currently pending.
6. The Bombay Dyeing & Manufacturing Company Limited. has filed Suit No. 1535 of 2005 before the
Bombay High Court against the Company seeking to restrain it from using the trademark
“BEAUTYCALE” in respect of bed-sheets, textiles and other fabrics. The complainant has alleged that
the packaging and advertising material represented in the artistic label bears a colour scheme, logo,
Page 109 of 144

font of writing, lay-out, get-up, style and representation identical with and/or is substantially similar to
the colour scheme, logo, font of writing, lay-out, get-up, style and representation of the complainant’s
label “BEAUCALE”. The complainant has sought damages for an amount aggregating approximately
Rs. 5 Crores as well as interest at the rate of 21 per cent per annum from the date of filing of the suit
till the date of payment. It also moved the Court by notice of motion No. 1642 of 2005 for interim
relief. The Court passed an ad-interim order dated June 15, 2005 restraining the Company from using
the impugned mark pending the hearing and final disposal of the suit. The Court Receiver has
submitted its report after conducting its inventory of the goods as directed by the Court. The matter is
currently pending.
7. The Inspector of Security Guard Board for Brihan Mumbai, V.M. Shewade has lodged complaint C.C.
No. 3113/55 of 2005 in the Court of the Additional Chief Metropolitan Magistrate, Mumbai for
employing a private security guard at Food Bazaar, Goregaon, without obtaining exemption from the
Guard Board. The matter is currently pending.
Page 110 of 144

INDEPENDENT ACCOUNTANTS
Our audited financial statements as of and for the three years ended March 31, 2006, 2005 and 2004 were
prepared in accordance with the accounting standards and generally accepted accounting principles
followed in India and which were so included in reliance on the report of M/s. NGS & Co., formerly known
as S.M. Kabra & Co., Chartered Accountants given on the authority of such firm as experts in auditing and
accounting.
Page 111 of 144

GENERAL INFORMATION
1. Our Company was incorporated on October 12, 1987 as Manz Wear Private Limited. The
Company was converted into a public limited company on September 20, 1991 and on September
25, 1992 the name was changed to Pantaloon Fashions (India) Limited and in the same year the
Company made an initial public offering. We later changed our name to Pantaloon Retail (India)
Limited on July 7, 1999.
2. The Issue was authorized and approved by our Board of Directors on August 24, 2006, 2006 and
approved by the shareholders in their meeting held on September 22, 2006.
3. We shall apply for in-principle approval to list the Equity Shares on the BSE, the NSE and the
DSE.
4. Copies of our Memorandum and Articles of Association will be available for inspection during
usual business hours on any weekday (except Saturdays and public holidays) at our Registered
Office.
5. We have obtained all consents, approvals and authorizations required in connection with this
Issue.
6. There has been no significant change in our financial position since September 30, 2006, the date
of our last published interim financial results.
7. Except as disclosed in this Placement Document, there are no litigation or arbitration proceedings
against or affecting us or our assets or revenues, nor are we aware of any pending or threatened
litigation or arbitration proceedings, which are or might be material in the context of this Issue of
Equity Shares.
8. Our auditors are M/s. NGS & Co., formerly known as S.M. Kabra & Co., who have audited and
reviewed the accounts for June 30, 2006, 2005 and 2004 and have consented to the inclusion of
their report in this Placement Document.
9. The Company confirms that it is in compliance with the minimum public shareholding
requirements as required under the terms of the listing agreements with the Stock Exchanges.
10. The Floor Price for the Issue is Rs. 326.58 per Equity Share of face value of RS. 2/- each. The
Floor price calculated as per clause 13A.3 of SEBI guidelines is Rs. 1,632.91/- of face value Rs.
10 each which has been suitable adjusted to reflect the stock split .
Page 112 of 144

INDEX TO FINANCIAL STATEMENTS
Page
Audited financial statements

AUDITORS’ REPORT ON THE FINANCIAL STATEMENTS...............................................................114
COMPARATIVE FINANCIALS................................................................................................................116
NOTES TO THE FINANCIAL STATEMENTS........................................................................................134
Our shareholders vide the annual general meeting dated November 17, 2006 approved the stock split of our
equity shares of Rs. 10 each to Rs. 2 each.
Page 113 of 144

AUDITOR’S REPORT ON THE FINANCIAL STATEMENTS
To
The Board of Directors
Pantaloon Retail (India) Limited
Mumbai
In terms of the appointment for the purpose of certification of the financial information of Pantaloon Retail
(India) Limited. (‘the Company’) annexed to this report, which is required to be prepared in accordance
with the Chapter XIII-A read with Schedule XXIA of the Securities and Exchange Board of India
(Disclosure and Investor Protection) Guidelines 2000 (‘the Guidelines’), issued by Securities and
Exchange Board of India (‘SEBI’) on 19 January 2000 in pursuance of section 11 of the Securities and
Exchange Board of India Act, 1992, as amended from time to time, we state as follows:
1. The financial statements referred to in this report are proposed to be included in the Placement
Document of the Company in connection with proposed issue of shares to Qualified Institutional
Buyers. (‘QIBs’).
2. The summary financial statements have been extracted from the Financial Statements for the year
ended June 30, 2006, June 30, 2005 and June 30, 2004, which were audited by us.
3. The financial statements have been prepared by the management of Pantaloon Retail (India)
Limited in accordance with the requirements of Accounting Standard (AS) 21- Consolidated
Financial Statements, Accounting Standard (AS) 23- Accounting for Investments in Associates in
Consolidated Financial Statements and Accounting Standard (AS) 27 – Financial Reporting of
Interests in Joint Ventures, issued by the Institute of Chartered Accountants of India.
4. In accordance with Chapter XIII-A read with Schedule XXIA of SEBI (Disclosure and Investor
Protection) Guidelines, 2000, we have examined the following
a. the Consolidated Balance Sheets of Pantaloon Retail (India) Limited and its subsidiaries
as at June 30, 2006 and June 30, 2004 and the standalone Balance Sheets of Pantaloon
Retail (India) Limited as at June 30, 2005
b. the Consolidated Profit and Loss Accounts and Consolidated Cash Flow Statements for
years ended June 30, 2006 and June 30, 2004 and the standalone Profit and Loss
Accounts and Consolidated Cash Flow Statement for years ended June 30, 2005
c. the accompanying notes to accounts along with accounting policies for the years ended
June 30, 2006 , June 30, 2005 and June 30, 2004
d. During the year ended June 30, 2005 the company has sold 49,99,930 shares of Pantaloon
Retail Technologies Limited and consequently Pantaloon Retail Technologies Limited
has ceased to be subsidiary company and the management has not considered
consolidation of accounts of the Subsidiary with that of the Company as the estimated
impact on the accounts attributable to the operation of the subsidiary upto the period was
not significant. In the same year the following companies have become the subsidiaries of
the Company.
Sr. Percentage of Holding

Name Of Subsidiary Company
No. as on 30th June,2005
1. Home Solutions Retail (India) Limited 66.66%
2. Pantaloon Food Product (India) Limited 99.88%
3. Pan India Restaurant Limited 98.46%
4. PFH Investment Advisory Company 76%
Limited
Page 114 of 144

These subsidiary companies were in the start up stage of business cycle and since there are no
material business transactions, accounts of these companies have not been consolidated.
5. The Company’s management is responsible for the preparation of the financial statements. Our
responsibility is to report based on the work done. We have performed such tests and procedures,
which, in our opinion, were necessary for our reporting to you. These procedures include
comparison of the annexed financial information with the Company’s audited financial statements.
Based on such procedures carried out by us and review of the records produce to us and the
information and explanations given to us by the Company’s management, and our comments in
the foregoing paragraphs, we confirm that nothing has come to our attention to show non-
compliance with the SEBI Guidelines.
6. We draw attention to the comparative financial statements forming part of our audit reports for the
years ended June 30, 2006, June 30, 2005, June 30, 2004:
7. This report is intended solely for your information and for the Company to comply with the
provisions of the Chapter XIII-A read with Schedule XXIA of the Securities and Exchanges Board
of India (Disclosure and Investor Protection) Guidelines 2000 and may not be suitable for any
other purpose. The report is not to be used, referred to or distributed for any other purposed
without our prior written consent.
For and on behalf of

NGS & Co.
Chartered Accountants
Navin T. Gupta
Partner
M. No 40334
Mumbai
Dated: November 23,2006
Page 115 of 144

COMPARATIVE FINANCIALS
BALANCE SHEET
SOURCES OF FUNDS Sch June 30, 2006 June 30, 2005 June 30, 2004
No. (Rupees Million) (Rupees Million) (Rupees Million)
SHAREHOLDERS' FUNDS
Share Capital 1 268.85 219.98 191.37
Share/Warrant Application
Money 66.48 30.00 -
Reserves & Surplus 2 5,010.92 1,965.28 739.18
5,346.24 2,215.25 930.55
Minority Interest 192.48 - -
LOAN FUNDS:
Secured Loans 3 5,230.92 2,561.70 2,152.86
10 % Unsecured Fully
Convertible Debentures - - 213.55
Unsecured Loans 4 1,796.57 300.38 0.08
7,027.49 2,862.08 2,366.49
DEFERRED TAX LIABILITY

(NET) 273.25 130.44 51.02
TOTAL 12,839.47 5,207.77 3,348.07
APPLICATION OF FUNDS
FIXED ASSETS 5
Gross Block 4,696.41 2,511.04 1,890.80
Less : Depreciation 602.22 373.63 271.13
Net Block 4,094.20 2,137.42 1,619.67
Capital work-in-progress
including advances 909.60 157.92 144.41
GOODWILL (on consolidation) 58.15 - 0.24
INVESTMENTS 6 416.08 319.16 3.93
CURRENT ASSETS, LOANS

& ADVANCES
Inventories 7 5,813.20 2,759.26 1,575.97
Sundry Debtors 8 285.45 123.07 176.04
Cash & Bank Balances 9 387.43 215.00 138.48
Loans & Advances 10 3,854.16 936.80 409.59
Other Current Assets 10.92 4.61 -
10,351.15 4,038.74 2,300.08
LESS : CURRENT
LIABILITIES & PROVISIONS
Current Liabilities 11 2,654.42 1,264.75 654.64
Provisions 12 335.87 183.47 69.74
Page 116 of 144

2,990.28 1,448.22 724.38
NET CURRENT ASSETS 7,360.87 2,590.52 1,575.70
MISCELLANEOUS 13
EXPENDITURE 0.56 2.76 4.12
(To the extent not written off or
adjusted)
TOTAL 12,839.47 5,207.77 3,348.07
SIGNIFICANT 20
ACCOUNTING POLICIES
AND NOTES TO ACCOUNTS
The Schedules referred to above form an integral part of the Balance Sheet
As per our Report of even date attached
For NGS & Co. For PANTALOON RETAIL (INDIA) LIMITED

NAVIN T. GUPTA KISHORE BIYANI VED PRAKASH ARYA

Partner Managing Director Director- Operations &
Membership No. 40334 Chief Operating Officer
Place : Mumbai KK RATHI SHIRAJ DEJ

Date: November 23, 2006. Chief Financial Officer Company Secretary
Page 117 of 144

PROFIT AND LOSS ACCOUNT

PARTICULARS Sch 2006 2005 2004
No. (Rupees Million) (Rupees Million) (Rupees Million)
INCOME
Sales & Operating Income 14 19,336.71 10,527.97 6,434.03

Other Income 15 36.66 30.54 13.28
19,373.36 10,558.51 6,447.31
EXPENDITURE
Cost of goods consumed &
sold 16 12,771.81 7,003.09 4,380.10
Personnel cost 17 1,225.70 506.54 277.05
Manufacturing & other
expenses 18 3,979.99 2,109.78 1,228.76
Finance Charges 19 354.20 274.57 231.47
Depreciation 5 226.97 133.33 95.69
Goodwill written off 1.41 - 0.06
18,560.08 10,027.30 6,213.06
Profit Before Taxation 813.28 531.21 234.25
Less: Earlier year's Income Tax 0.73 0.32 0.75

Less: Provision for Taxation
a) Current Tax 116.64 72.84 14.50
b) Deferred Tax 148.56 70.14 27.97
c) Fringe Benefit Tax 19.78 2.40 -
Profit After Taxation 527.58 385.51 191.03
Add: Share in the Profit of
Associates - - 1.48
Share of Minority Interest (9.52) - -
Profit After Minority Interest 537.10 385.51 192.52
Add : Balance brought forward 651.96 380.81 329.48

Available for Appropriation 1,189.07 766.32 522.00

Transfer to General Reserve 64.16 38.55 9.89
Brands Set-off - - 117.13
Balance carried to Balance Sheet 1,048.27 665.06 362.52

1,189.07 766.32 522.00
Earnings Per Share Rs. (Face

value Rs.10) Rs. Rs. Rs.
Basic 21.18 16.54 10.16
Diluted 21.18 15.63 9.63
Page 118 of 144

SIGNIFICANT 20
ACCOUNTING POLICIES
AND NOTES TO ACCOUNTS
The Schedules referred to above form an integral part of the Balance Sheet


Place : Mumbai K K RATHI SHIRAJ DEJ

Date: November 23, 2006. Chief Financial Officer Company Secretary
Page 119 of 144

CASH FLOW STATEMENT
(Pursuant to Clause 32 of the Listing Agreement)

PARTICULARS 2006 2006 2006
(Rupees Million) (Rupees Million) (Rupees Million)
Cash Flow from Operating
Activities
Net Profit Before Tax and 821.56 531.21 234.19
Extraordinary items
Adjustments for :
Depreciation 224.22 133.33 95.75
Preliminary & capital issue exp 1.71 1.24 1.44
w/o
Provision for Doubtful 0.28 1.35 2.18
Debts/advances
Interest (Net) 354.21 274.57 231.47
Dividend Income (0.06) (0.08) (0.05)
(Profit) / Loss on sale of shares - (11.71) (0.44)
(Profit) / Loss on sale of asset 0.95 0.53 0.23
Operating profit before 1,402.87 930.44 564.75
working capital changes
Adjustments for :
Trade and other receivable (159.57) 51.43 45.21
Inventories (2,937.59) (1,183.28) (432.16)
Loans & advances (1,389.90) (172.79) (172.07)
Trade payables 695.16 599.92 36.39
Other payables 25.53 12.66 3.35
Cash generated from
operations (2,363.50) 238.38 45.46
Direct taxes paid (107.79) (41.06) (27.39)
Cash flow before
Extraordinary items (2,471.29) 197.31 18.07
Extraordinary items (0.73) (0.32) (0.75)
Net Cash from Operating
Activities (2,472.01) 196.99 17.32
Cash Flow From Investing

Activities
Purchase of Fixed Assets (1,474.49) (668.57) (614.24)
(Increase)/Decrease in capital (712.91) (13.50) (111.18)
work - in - progress
Share Application Money (49.79) - -
Sale of fixed assets 2.87 1.17 0.16
Sale of investments 37.20 64.00 0.52
Purchase of investments (232.33) (318.82) (0.10)
Advances Given (11.78) (3.65) -
Advances received 159.64 - -
Inter Corporate Deposits (220.70) - -
Deposit given-leased premises (1,116.67) (318.54) -
Dividend Income 0.06 0.08 0.05
Deposits Made (73.88) - -
Net Cash used in Investing
Activities (3,692.78) (1,257.83) (724.80)
Page 120 of 144

Cash Flow from Financing
Activities
Payment of Dividend and (62.71) (32.46) (20.51)
Dividend Tax
Working Capital from 882.37 (80.75) 90.67
Banks/Institutions
Conversion of Debentures into - (213.55) -
Equity Shares
Proceeds from Issue of Share 2,674.65 913.55 106.74
Capital
Proceeds from Issue of - - 213.55
Unsecured FCDs
Proceeds from Issue of 250.00 17.50 132.50
Commercial Paper
Warrant Application money 66.48 30.00 -
received
Proceeds from long term 741.17 481.60 512.08
borrowing
Proceeds from Other Borrowings 2,041.50 296.04 (38.40)
Rights Issue Expenses (17.79) - -
Interest (Net) (354.21) (274.57) (231.47)
Net Cash from financing
activities 6,221.46 1,137.37 765.16
Net Cash used in Cash and

Cash Equivalents (A+B+C) 56.67 76.53 57.68
Cash & Cash Equivalents 330.76 138.48 80.80
(Opening balance)
Cash & Cash Equivalents 387.43 215.00 138.48
(Closing balance)
Net Cash used in Cash and 2005-06 2004-05 2003-04

Cash Equivalents
Cash in Hand 43.61 21.58 16.52
Balance with Scheduled Banks :
in Current Accounts (including in 277.02 95.47 46.65
transit)
in Fixed Deposit Account 65.11 87.66 74.51
Fixed deposit with IDBI - 9.15 -
Dividend Account 1.69 1.15 0.80
387.43 215.00 138.48


Place : Mumbai KK RATHI SHIRAJ DEJ

Date: November 23,2006. Chief Financial Officer Company Secretary
Page 121 of 144

SCHEDULES TO BALANCE SHEET
As At June 30,2006 June 30, 2005 June 30, 2004

(Rupees
Million) (Rupees Million) (Rupees Million)
SCHEDULE 1: SHARE
CAPITAL
AUTHORISED
Equity Shares of Rs.10/- each. 350.00 250.00 250.00
350.00 250.00 250.00
ISSUED
26887081 (21997736) Equity
Shares 268.87 219.98 191.37
of Rs.10/- each fully paid
268.87 219.98 191.37
SUBSCRIBED & PAID UP

26884621 (21997736) Equity
Shares of Rs. 10/- each fully paid 268.85 219.98 191.37
268.85 219.98 191.37
SCHEDULE 2: RESERVES &

SURPLUS
Share Premium
Balance, at beginning of the year 1,251.23 366.28 269.08
Add : Premium received during the
year 2,490.49 884.94 97.21
Less : Utilised for share issue
expenses (20.55) - -
3,721.17 1,251.23 366.28
Capital Reserve on Consolidation 128.33 - -
General Reserve
Balance, at beginning of the year 48.99 10.43 0.55
Add : Transfer from Profit & Loss
Account 64.16 38.55 9.89
113.14 48.99 10.43
Surplus in Profit and Loss

Account 1,048.27 665.06 362.46
5,010.92 1,965.28 739.18
SCHEDULE 3: SECURED
LOANS
(1) Term Loans
a) Foreign Currency Loans
-From Banks 117.48 149.16 168.67
-From Financial Institutions 56.76 123.71 169.17
Page 122 of 144

b) External Commercial
Borrowings 230.40 267.59 298.84
c) Rupee Loans
-From Banks 3,060.38 1,254.94 603.42
-From Financial Institutions
and Others 1.02 173.62 252.57
(2) Working Capital Loans From
Banks
Foreign Currency Loans 57.89 426.44 284.89
Rupee Loan 1,248.56 11.35 233.65
Commercial Paper 400.00 150.00 132.50
(3) Hire Purchase 2.85 4.90 9.16
Share in jointly controlled entities 55.60 - -

5,230.92 2,561.70 2,152.86
SCHEDULE 4: UNSECURED
LOANS
Short Term Loans from Banks 1,602.85 300.33 -
Public Deposits 49.05 0.05 0.08
1,796.57 300.38 0.08
SCHEDULE 6: INVESTMENTS
LONG TERM INVESTMENT
IN SHARES
QUOTED
5,631 (Nil) Equity shares of
Andhra Bank Limited of Rs. 10/-
each fully paid up 0.51 - -
20,00,000 Equity shares of Galaxy

Entertainment Corporation Limited
of Rs. 10/- each fully paid up 88.35 88.35 -
18,300 (21300) Equity shares of

UTI Bank Limited of Rs. 10/- each
fully paid up - - 0.38
1,700 (21300) Equity shares of The

Syndicate Bank Limited of Rs. 10/-
each fully paid up - - 0.02
UNQUOTED
In Subsidiary Company
32,00,000 Equity Shares of Pan
India Restaurants Limited of Rs.
10/- each fully paid up - 80.00 -
NIL(76,000) Equity Shares of PFH

Investment Advisory Company
Limited of Rs. 10/- each fully paid
up - 7.60 -
Page 123 of 144

50,000 Equity Shares of Pantaloon
Food Products (India) Limited of
Rs. 10/- each fully paid up - 0.50 -
1,75,15,471 (33,329) Equity Shares

of Home Solutions Retail (India)
Limited of Rs. 10/- each fully paid
up - 0.33 -
In Joint Venture Company

28,40,880 Equity Shares of Planet
Retail Holding Private Limited of
Rs. 10/- each fully paid up - 142.04 -
In Others
603,228.576 units of ICICI
Prudential Floating Rate Plan 3.02 - -
1185,539.460 units of ABN AMRO
Cash Fund 11.86 - -
147 Shares of Mark Middle East
(LLC) @ 1000 Dirhams each fully
paid up - - 3.15
5 Shares of Y.A Chunawala
Industrial Co-op Society Limited 0.00 0.00 0.00
1,600 Equity shares of The Bombay
Mercantile Co-op Bank Limited of
Rs. 30/- each fully paid up - - 0.05
4,000 Equity shares of Kalyan

Janata Sahakari Bank Limited of Rs.
25/- each fully paid up 0.10 0.10 0.10
4,000 Equity Shares of The

Zorastrian Co.Op.Bank of Rs. 10/-
each fully paid up 0.10 0.10 0.10
67,13,865 Equity Shares of Off

Beat Developer of Rs. 10/- each
paid up 312.00 - -
OTHER
National Saving Certificates 0.16 0.13 0.13
416.08 319.16 3.93
Page 124 of 144

As At June 30,2006 June 30, 2005 June 30, 2004
(Rupees
Million) (Rupees Million) (Rupees Million)
SCHEDULE 7: INVENTORIES
(As certified and valued by the
Management)
Packing Materials , Branding
Material and Stores & Spares 54.45 20.21 12.35
Raw Material 130.95 199.58 294.93
Stitching Materials 12.61 8.78 14.96
Semi finished goods 67.93 61.07 37.44
Finished Goods 5,330.14 2,469.62 1,216.30
5,813.20 2,759.26 1,575.97
SCHEDULE 8: SUNDRY
DEBTORS
(Unsecured)
(a) Debts due for more than six
months
Considered Good 83.48 6.44 4.15
Considered Doubtful 6.38 7.13 5.78
89.86 13.57 9.94
Less : Provision for Doubtful
Debts 6.38 7.13 5.78
83.48 6.44 4.15
(b) Other Debts : Considered Good 115.83 116.63 171.88

- -
285.45 123.07 176.04
SCHEDULE 9: CASH & BANK

BALANCES
Cash in Hand 41.82 21.58 16.52
Balance with Scheduled Banks :
in Current Accounts (including in
transit) 271.97 95.47 46.65
in Fixed Deposit Account 62.31 96.81 74.51
Dividend Account 1.69 1.15 0.80
387.43 215.00 138.48
SCHEDULE 10: LOANS &

ADVANCES
(Unsecured & Considered good)
Loans 220.70 - -
Advances Recoverable in cash or in
kind or for value to be received 1,271.88 219.03 84.41
Export Benefits Receivables 0.75 0.26 0.40

Fixed deposit with IDBI 94.76 - 8.25
Page 125 of 144

Deposits 2,032.69 645.31 281.16
Payments /Deduction of Income
Tax 175.22 72.20 35.34
Balance with Excise Authorities - - 0.03
3,854.16 936.80 409.59
SCHEDULE 11: LIABILITIES

Acceptances 546.33 113.69 405.30
Sundry Creditors 1,515.23 780.82 135.88
Sundry Creditors - Due to Group
Companies 25.04 - -
Sundry Creditors for Capital Goods 175.39 188.24 22.73
Advances / Deposit from
Customers 187.92 160.16 84.37
Advances / Deposit from Others 12.02 - -
Interest accrued but not due 11.81 9.07 0.02
Other Liabilities 19.13 11.62 5.56
Unclaimed Dividends 1.68 1.14 0.79
2,654.42 1,264.75 654.64
SCHEDULE 12: PROVISIONS

Provision for Leave Encashment /
Gratuity 32.04 15.88 10.11
Provision for Fringe Benefit
Taxation 21.05 2.40 -
Provision for Income Tax 198.45 95.84 27.17
Other Provisions 0.75 6.64 -
335.87 183.47 69.74
SCHEDULE 13:
MISCELLANEOUS
EXPENDITURE
Preliminary expenses 0.53 - 0.12
Capital issue expenses - 2.76 4.00
0.56 2.76 4.12
Page 126 of 144

SCHEDULES TO PROFIT & LOSS ACCOUNT
June 30,2006 June 30, 2005 June 30, 2004

(Rupees Million) (Rupees Million) (Rupees Million)
SCHEDULE 14: SALES &
SERVICES
Sales 17,734.94 10,182.66 6,324.19
Other Operating Income 1,099.17 345.31 109.84

19,336.71 10,527.97 6,434.03
SCHEDULE 15: OTHER INCOME
Dividend 0.11 0.08 0.05
Export Benefits 1.01 3.72 0.40
Miscellaneous Income 9.71 4.13 6.73
Profit on Sale of Shares (0.01) 11.71 0.44
Rent Received 11.99 0.66 0.66
Cash Discount 8.22 8.62 2.54
Insurance Claim 1.02 0.78 0.45
Sundry Balances W/back (Net) 0.71 0.84 2.00
36.66 30.54 13.28
SCHEDULE 16: COST OF GOODS

CONSUMED & SOLD
Opening Stock
Raw Materials 199.58 294.93 166.38
Finished goods & Accessories 2,469.62 1,216.30 934.61
Stitching materials 8.78 14.96 6.03
2,739.05 1,563.62 1,134.20

Add : Purchase
Page 127 of 144

Raw Material 1,406.22 1,189.65 1,083.31
Finished goods & Accessories 13,821.77 6,926.44 3,684.02
15,304.50 8,183.80 4,809.52

Less : Closing Stock
Raw Materials 130.95 199.58 294.93
Finished goods & Accessories 5,330.01 2,469.62 1,216.30
5,541.49 2,739.05 1,563.62

Less : Insurance Claim
20.60 5.29 -
Share in jointly controlled entities

290.35 - -
12,771.81 7,003.09 4,380.10
SCHEDULE 17: PERSONNEL

COST
Salaries, Wages & Bonus 1,066.83 445.28 245.09
Welfare expenses 62.91 23.94 18.28
Contribution to E.S.I.C & P.F.Fund 58.14 34.33 1.70
Gratuity 6.46 3.00 11.98
1,225.70 506.54 277.05
SCHEDULE 18:
MANUFACTURING
& OTHER EXPENSES
Labour Charges 206.62 152.70 69.66
Packing Material & Expenses 192.25 124.43 56.36
Stores & Spares Consumed 2.52 1.82 1.89
Branding Material Consumed 31.82 30.24 18.31
Page 128 of 144

Printing & Stationery 60.65 33.04 18.87
Power & Fuel 377.04 219.54 120.78
Mall Maintenance Charges 336.07 216.82 101.27

Repairs & Maintenance
Building 13.47 2.62 6.49
Plant & Machinery 6.11 1.30 0.19
Others 62.69 34.25 16.82
Rent 1,081.90 479.69 275.89
Rates & Taxes 30.56 12.21 11.31
Excise Duty - 2.81 33.56
Donation 5.27 2.25 0.50
Credit card charges 84.58 41.62 24.66
Insurance 21.86 26.15 14.64
Legal & Professional Charges 68.99 32.97 21.27
Communication Expenses 72.84 40.72 20.58
Traveling & Conveyance Expenses 146.49 65.56 39.92
Auditors' Remuneration 3.74 1.72 0.90
Transportation & Handling charges 195.22 126.57 59.52
Commission 70.73 99.99 89.09
Advertisement & Sales Promotion 530.23 325.65 187.47
Lease Rental & Hire Charges 86.88 9.39 0.14
Directors Sitting Fees 1.13 1.21 0.87
Directors Commission 6.50 1.00 -
Loss on Sale of Fixed Assets 0.10 0.53 0.23
Provision for Doubtful Debts 0.56 1.35 2.18
Royalty 3.19 1.25 -
Other Expenses 83.21 49.80 26.07
Capital Issue Expenses w/off - 1.24 1.24
Page 129 of 144

Foreign Exchange loss/(profit) 34.65 (30.67) 7.91
Preliminary Expenses w/off 1.52 0.00 0.20
3,979.99 2,109.78 1,228.76
SCHEDULE 19: FINANCE

CHARGE
Interest : on fixed loans 90.90 178.64 129.99
on other loans 214.34 44.25 38.04

on Fully Convertible
Debentures - 11.27 13.54
Bill Discounting Charges 15.98 30.51 35.78
Bank Charges 39.79 17.28 18.59
361.01 281.95 235.93

Less : Interest Income
On Fixed Deposits 3.81 6.37 4.14
On Others 9.55 1.01 0.33
354.20 274.57 231.47
Schedule 5: Fixed Asset & Capital Work-in-Progress
2005-06 Gross Block Depreciation Net Block

Descript As at Addition Deduct As At Upto Adjustm Depreciat Upto As at As at
ion 01.07.20 s ions 30.06.20 01.07.20 ent ion 30.06.20 30.06.20 30.06.20
05 06 05 For the For the 06 06 05
year year
Land 47.58 - - 47.58 - - - - 47.58 47.58

Leasehol
d Land 104.76 6.12 - 110.89 6.16 - 2.47 8.62 102.26 11.02
Building 1,088.79 99.05 1.55 1,186.29 36.76 0.78 17.28 53.25 1,133.04 339.54
Kiosk
Units - 3.73 - 3.73 - - 0.39 0.39 3.34 -
Plant &
Machiner
y 167.43 32.16 2.33 197.27 24.47 0.80 9.38 33.05 164.22 142.42
Office
Equipme 67.99 43.65 0.25 111.39 8.07 0.01 5.08 13.14 98.26 55.65
Page 130 of 144

nts
Compute
r Owned 291.90 257.57 1.07 548.40 110.93 0.26 66.89 177.56 370.84 178.07
Compute
r Leased 22.63 - 14.93 7.71 17.21 14.93 4.04 6.32 1.39 5.42
Furniture
&
Fittings 974.22 652.50 1.19 1,625.53 127.70 0.65 84.12 211.17 1,414.36 832.51
Electrical
Instal. 450.13 224.04 - 674.17 38.24 - 27.10 65.35 608.82 411.89
Vehicles 35.70 17.66 - 53.36 8.25 - 4.24 12.49 40.87 24.98

Air
Conditio
ner 89.53 12.94 - 102.46 12.46 - 4.62 17.08 85.38 77.06
Generato
r 9.78 12.95 - 22.73 1.68 - 0.85 2.53 20.20 8.10
Delivery
Van 3.97 0.23 - 4.20 0.77 - 0.46 1.23 2.96 3.20
Brand -
Intangibl
es - 0.70 - 0.70 - - 0.04 0.04 0.66 -
Total 3,354.41 1,363.31 21.31 4,696.41 392.69 17.44 226.97 602.22 4,094.20 2,137.42
Capital Work-In-Progress 909.60 157.92
Page 131 of 144

Descript As at Additio Deducti As At Upto Adjustm Depreciat Upto As at As at
ion 01.07.20 ns ons 30.06.20 01.07.20 ent ion 30.06.20 30.06.20 30.06.20
04 05 04 For the For the 05 05 04
year year
Land 21.08 26.50 - 47.58 - - - - 47.58 21.08

Leasehol
d Land 11.71 - - 11.71 0.52 - 0.17 0.69 11.02 11.19
Building 354.73 18.47 - 373.19 22.42 - 11.24 33.66 339.54 332.31

Plant &
Machiner
y 157.84 11.43 2.83 166.44 18.60 2.34 7.76 24.02 142.42 139.24
Office
Equipme
nts 48.12 14.94 - 63.06 4.91 - 2.51 7.41 55.65 43.21
Compute
r Owned 192.05 94.97 - 287.02 74.69 - 34.26 108.96 178.07 117.36
Compute
r Leased 22.63 - - 22.63 11.19 - 6.02 17.21 5.42 11.44
Furniture
&
Fittings 620.05 346.62 13.45 953.22 73.56 - 47.15 120.71 832.51 546.49
Electrical
Instal. 300.19 149.94 - 450.13 21.66 - 16.58 38.24 411.89 278.53
Vehicles 25.17 9.40 1.77 32.80 5.58 0.57 2.80 7.82 24.98 19.58
Air
Conditio
ner 81.20 8.33 - 89.52 8.45 - 4.02 12.47 77.06 72.75
Generato
r 9.64 0.14 - 9.78 1.22 - 0.46 1.68 8.10 8.42
Delivery
Van 2.67 1.30 - 3.97 0.41 - 0.37 0.77 3.20 2.27
Total 1,847.08 682.02 18.06 2,511.04 243.20 2.91 133.33 373.63 2,137.42 1,603.88
Capital Work-In-Progress
157.92 1,444.14
Page 132 of 144

Descript As at Addition Deduct As At Upto Adjustm Depreciat Upto As at As at
ion 01.07.20 s ions 30.06.20 01.07.20 ent ion 30.06.20 30.06.20 30.06.20
03 04 03 For the For the 04 04 03
year year
Land 21.08 - - 21.08 - - - - 21.08 21.08

Leasehol
d Land 11.71 - - 11.71 0.34 - 0.17 0.52 11.19 11.36
Building 261.51 93.22 - 354.72 14.14 - 8.27 22.42 332.30 247.36

Plant &
Machiner
y - - - - - - - - - -
Office
Equipme
nts 96.02 61.92 - 157.94 13.11 - 5.50 18.62 139.32 82.91
Compute
r Owned 28.38 19.80 0.02 48.16 3.26 0.02 1.67 4.91 43.24 25.11
Compute
r Leased 181.90 53.77 - 235.67 76.21 - 26.39 102.60 133.07 105.69
Furniture
&
Fittings 22.62 - - 22.62 5.48 - 5.71 11.19 11.43 17.14
Electrical
Instal. 401.22 219.65 0.78 620.08 42.46 0.78 31.89 73.57 546.51 358.76
Vehicles 174.03 126.26 0.08 300.20 11.29 0.08 10.45 21.66 278.54 162.73
Air
Conditio
ner 19.28 6.79 0.90 25.17 3.93 0.52 2.17 5.58 19.58 15.35
Generato
r 52.17 29.03 - 81.20 5.57 - 2.88 8.45 72.75 46.60
Delivery
Van 6.50 3.04 - 9.54 0.85 - 0.36 1.20 8.34 5.65
Cycle 1.90 0.77 - 2.67 0.17 - 0.23 0.41 2.27 1.73
Total 0.03 - - 0.03 0.00 - 0.00 0.00 0.03 0.03

Capital Work-In-Progress
144.41 33.24
Page 133 of 144

NOTES TO THE FINANCIAL STATEMENTS
SCHEDULE 20
SIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PART OF THE

COMPARATIVE ACCOUNTS FOR THE YEAR ENDED 30TH JUNE 2006, 30TH
JUNE 2005 AND 30TH JUNE 2004
1. SIGNIFICANT ACCOUNTING POLICIES :
1.1 Basis of Accounting :

The financial statements have been prepared to comply in all material respects with the mandatory Accounting
Standards issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies
Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The
accounting policies have been consistently applied by the Company and are consistent with those used in the
previous year.
1.2 Fixed Assets and Depreciation :

Fixed assets are stated at cost, less accumulated depreciation . Cost comprises the purchase price and any
attributable cost of bringing the asset to its working condition for its intended use. Financing costs relating to
acquisition of fixed assets are also included to the extent they relate to the period till such assets are ready to be put to
use.
Depreciation is provided on Straight Line Method as per the rates and in the manner prescribed in Schedule XIV to
the Companies Act, 1956 except employee perquisite- related assets which are depreciated over three years.
Depreciation on the amount capitalised on account of foreign exchange fluctuation is provided prospectively over the
residual life of the assets.
1.21 Goodwill on Consolidation

The excess of cost to the Parent Company of its investment in subsidiaries over the Parent Company’s portion of
equity in the subsidiaries at the respective dates, on which investments in subsidiaries were made, is recognized in
the consolidated financial statements as goodwill. The Parent Company’s portion of equity in the subsidiaries is
determined on the basis of the book value of assets and liabilities as per the financial statements of the subsidiaries as
on the date of investment. The Goodwill recorded in these consolidated financial statements will be written off 5
years from the year of acquisition.
1.22 Leased Fixed Assets

Lease payments under operating lease are recognised as expense as per the tenure of the lease agreements.
Assets taken on finance lease (including that prior to 1st April 2001) are capitalised and finance charges are charged
to Profit & Loss account on accrual basis.
1.3 Borrowing Cost:

Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are
capitalized as part of the cost of that asset up to the date the assets are ready for their intended use or sale. Other
expenses are recognized as an expense in the period in which they are incurred.
Page 134 of 144

1.4 Investments :
Long-term investments are stated at cost. Provision for diminution is being made if necessary to recognise a decline,
other than temporary in the value thereof.
Current Investments are stated at the lower of cost and market / fair value.
1.5 Inventories :
Inventories are valued as follows :
a) Stores, Spare parts, Packing material, and Branding Material : At cost

b) Raw material & Stitching material : At cost
c) Finished goods lying at the stores : At the retail price less mark up
d) Work in Progress and Finished goods lying in the factory : At the lower of cost or net
realisable value.
In case of finished goods, cost includes material cost and direct production overheads.
1.6 Transactions in Foreign Currency :

Foreign currency transactions are accounted at the rates prevailing on the date of transaction.Year-end current assets
and liabilities are translated at the exchange rate ruling on the date of the Balance Sheet.
Exchange differences on settlement / conversion are adjusted to :
(i) Cost of fixed assets, if the foreign currency transaction relates to fixed assets.
(ii) Profit and Loss Account, in other cases.
(iii) Wherever forward contracts are entered into, the exchange differences are dealt with in the Profit and
Loss Account over the period of the contracts.
1.7 Revenue Recognition :

Sale of Goods are accounted on delivery to customers. Sales is net of returns and discounts. Sales tax/Value Added
Tax is reduced from sales. Export sales is accounted as revenue on the basis of Bill of Lading. Interest income is
recognised on accrual basis. Dividend income is accounted for when the right to receive is established. Claims are
accounted only when there is reasonable certainty of its ultimate collection.
1.8 Miscellaneous Expenditure :
Right Issue Expenses are adjusted to Share Premium Account and Preliminary expenses are charged to Profit & Loss
Account as incurred.
1.9 Retirement Benefits :

In respect of benefits like Gratuity and Leave encashment ,the provision is accrued and provided for on the basis of
actuarial valuation at the end of every Financial Year
1.10 Taxation :
Page 135 of 144

a) The deferred tax for timing differences between the book and tax profits for the period is accounted for using the
tax rates and laws that have been substantially enacted as on the balance sheet date. Deferred tax assets are
recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available
against which such deferred tax assets can be realized. Deferred tax assets are recognized on carry forward of
unabsorbed depreciation and tax losses only if there is virtual certainty that such deferred tax assets can be realized
against future taxable profits.
b) Provision for Current Tax is made on the basis of taxable profits computed for the current accounting period
(reporting period) in accordance with the Income Tax Act, 1961.
1.11 Premium on Prepayment of Term Loans :

Premium paid on prepayment of Term Loans is amortised over the unexpired tenure of the said Term Loan.
1.12 Provisions, Contingent Liabilities and Assets

Provisions are recognised when the company has a present obligation as a result of past events and it is more likely
than not that an outflow of resource will be required to settle the obligation and the amount has been reliably
estimated.
1.13 Impairment of Assets

An asset is treated as impaired when the carrying cost of asset exceeds its recoverable value. An impairment loss is
charged to Profit & Loss Account in the year in which the asset is impaired and the impairment loss recognised in
prior accounting periods is reversed if there has been a change in the estimate of recoverable amount. For the purpose
of assessing impairment, assets are grouped at the lowest level of cash generating units.
2. Principles of Consolidation:
The consolidated financial statements relate to Pantaloon Retail (India) Limited, the holding company, its
majority owned subsidiaries, Joint Ventures and Associates (collectively referred to as Group). The
consolidation of accounts of the Company and it subsidiaries has been prepared in accordance with
Accounting Standard (AS) 21 “Consolidated Financial Statements”. The financial statements of the parent
and its subsidiaries are combined on a line by line basis and intra group balances, intra group transactions
and unrealized profits or losses are fully eliminated.
In the consolidated financial statements, ‘Goodwill’ represents the excess of cost to the Company of its
investment in the subsidiaries and/or joint ventures over its share of equity, at the respective dates on which
the investments are made. Alternatively, where the share of equity as on the date of investment is in excess
of cost of investment, it is recognized as ‘Capital Reserve’ in the consolidated financial statements.
Minority interest in the net assets of consolidated subsidiaries consists of the amount of equity attributable
to the minority shareholders at the respective dates on which investments are made by the Company in the
subsidiary companies and further movements in their share in the equity, subsequent to the dates of
investment as stated above.
Investments in Joint Ventures are dealt with in accordance with Accounting Standard (AS) 27 “Financial
Reporting of Interests in Joint Ventures”. The Company’s interest in jointly controlled entities are reported
using proportionate consolidation, whereby the Company’s share of jointly controlled assets and liabilities
and the share of income and expenses of the jointly controlled entities are reported as separate line items.
Investments in Associates are dealt with in accordance with Accounting Standard (AS) 23 “Accounting for
Investments in Associates in Consolidated Financial Statements”. Effect has been given to the carrying
amount of investments in associates using the ‘Equity method’. The Company’s share of the post
acquisition profits or losses is included in the carrying cost of investments.
Page 136 of 144

The financial statements of the subsidiaries, joint ventures and associates used in the consolidation are
drawn upto the same reporting date as of the Company i.e. year ended June 2006, except in respect of Pan
India Restaurant Limited and CIG Infrastructure Limited the subsidiary companies, Planet Retail (India)
Limited, a joint venture company and Supreme Tradelinks Private Limited, a wholly owned subsidiary of
Planet Retail (India) Ltd., whose accounts for the year ended March 31, 2006 have been consolidated.
There are no significant transactions during the period April 2006 to June 2006 and hence there is no
impact on the profit & loss account.
The accounts of Convergem Retail (India) Limited, a subsidiary company have not been audited for the
period ended June 30, 2006 and have been consolidated on the basis of the accounts as certified by their
management. Further the accounts of Joint Venture Company, Planet Retail Private Limited and its
Subsidiary Supreme Tradelinks Private Limited, have not been audited for the year ended March 31, 2006
and have been consolidated on the basis of the accounts as certified by their respective managements.
3. Information on subsidiaries, joint ventures and associates:

(a) The subsidiary companies considered in the consolidated financial statements are:
S. No. Name of the Company Country of Percentage Holding

Incorporation
For the consolidated financials statements for the year ended on 30th June, 2006:
1. Home Solutions Retail (India) Limited India 100%
2. Pantaloon Food Products (India) Limited India 100%
3. Future Media (India) Limited India 100%
4. Future Logistics Solutions Limited India 100%
5. Convergem Retail (India) Limited India 100%
6. Pan India Restaurants Limited India 98.46%
7. KB Infin Private Limited India 79.14%
8. Ambit Investment Advisory Co. Limited India 79.14%
(100% subsidiary of KB Infin Private Limited
9. KSHITIJ Investment Advisory Co. Limited India 72.81%
(92% subsidiary of KB Infin Private Limited)
10. Indivision Investment Advisory Limited India 79.14%
(100% subsidiary of KB Infin Private Limited
11. Myra Mall Management Co. Private Limited India 79.14%
(100% subsidiary of KB Infin Private Limited)
12. Foot-Mart Retail (India) Limited India 51%
13. CIG Infrastructure Private Limited India 51%
1. Planet Retail Technologies Limited India 99.99%
(b) Interests in Joint Ventures:

Incorporation
1. GJ Future Fashions Limited India 50%
2. Planet Retail Holdings Private Limited India 49%
3. Supreme Tradelinks Limited India 49%
(100% subsidiary of Planet Retail Holdings
Private Limited
4. Gupta Infrastructure India Private Limited India 20%
Page 137 of 144

(c) Investment in Associates, considered in the financial statements for the year ended on 30th June,
2006 are:
Incorporation
1. Off Beat Developers Private Limited India 26.86%
1 Mark Middle East, L.L.C. Dubai, U.A.E. 49.00%
4. The break-up of Investment in Associates is as under:
Rs. Million
Cost of Goodwill included in cost of Share in profits/(loss) Carrying cost of
Acquisition acquisition post acquisition investment
Off Beat Developers Private
Limited 312.00 84.45 Nil 312.00
5 Contingent Liabilities not provided for:

5.1 Bill Discounting Rs. Nil (2005: Rs. 18.51 Million, 2004: 40.03 Million)
5.2 Guarantee outstanding Rs. 53.98 Million (2005: Rs. 154.32 Million, 2004: 74.93 Million)
5.3 Income tax demand against which Company has filed appeal Rs. Nil (2005: Nil, 2004: Rs. 0.03 Million)
5.4 Claims against the company not acknowledged as debts : Rs. 52.40 Million (2005: Rs. 0.50 Million, 2004: Rs. 0.50
Million)
5.5 Unused letter of credits Rs.97.87 Million (2005: Nil, 2004: Nil)
6. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of
advances) Rs. 363.85 Million. (2005: Rs. 31.62 Million; 2004: Rs. 11.31 Million).
7. Future interest liabilities in respect of assets of the value of Rs. 7.47 Million (2005: Rs. 13.33 Million,
2004: 15.48 Million) acquired on hire purchase basis is Rs. 0.02 Million (2005: Rs. 0.34 Million, 2004:
Rs. 1.15 Million).
8. The company has taken some assets on Finance Lease basis. Future Lease Rental obligations in respect
of these assets are Rs.1.05 Million (2005: Rs. 4.19 Million, 2004: Rs. 6.88 Million). The Lease Rent
payable not later than one year is Rs.1.05 Million (2005: Rs. 2.70 Million, 2004: Rs. 3.18 Million) and
that repayable later than one year but not later than 5 years is Rs. Nil (2005: Rs. 1.01 Million, 2004:
Rs. 3.71 Million).
9. The Company has entered into operating lease arrangements for the fixed assets of its stores. The
future lease rental obligation in respect of these assets is Rs. 808.87 Million (2005: Rs. 233.34 Million,
2004: Nil). The Lease Rent payable not later than one year is Rs.160.58 Million (2005: Rs. 36.38
Million, 2004: Nil), repayable later than one year but not later than 5 years is Rs. 607.60 Million
(2005: Rs. 196.69 Million, 2004: Nil)and that repayable later than 5 years is Rs. 40.69 Million (2005:
Rs. 0.30 Million, 2004: Nil).
10. Related Party Disclosure :

Disclosures as required by the Accounting Standard 18 “Related Party Disclosure” are given below :
A) List of Related Parties
Associate Companies / Firm
Whether related for year ended
Page 138 of 144

Sr. No. Name of the Company June 30, June 30, June 30,
2006 2005 2004
1. Pantaloon Industries Limited; Yes Yes Yes
2. Indus League Clothing limited; Yes Yes No
3. KB Mall management Company Yes Yes No
limited;
4. PFH Entertainment Limited; Yes Yes Yes
5. Manz Retail Private Limited; Yes Yes Yes
6. Idiom Design & Consulting Limited; Yes Yes No
7. Nishta Mall Management Company Yes Yes No
Private Limited;
8. Niyaman Mall Management Company Yes Yes No
Private Limited;
9. Acute Realty private Limited; Yes Yes No
10. Dhruv Synthetics Private Limited Yes Yes Yes
11. Anchor Malls Private Limited; Yes Yes No
12. Varnish Trading Private Limited; Yes Yes No
13. Bansi Silk Mills; Yes Yes Yes
14. Bartraya Mall Management Company Yes No No
Private Limited;
15. Unique Malls Private Limited; Yes No No
16. BLB Mall Management Company Yes No No
Private Limited;
17. ESES Commercials Private Limited; Yes No No
18. Bansi Mall Management Company Yes No No
Private Limited;
19 Ojas Mall Management Company Yes No No
Private Limited;
20. Suhani Mall Management Company Yes No No
Private Limited;
21. Mark Middle East, LLC, Dubai (part of No Yes Yes
the year ended 30th June, 2005)
Subsidiary
2006 2005 2004
1. Home Solutions Retail (India) Limited N.A. Yes N.A.
2. Pantaloon Food Products (India) N.A. Yes N.A.
Limited
3. Pan India Restaurants Limited N.A. Yes N.A.
4. PFH Investment Advisory Company N.A. Yes N.A.
Limited
5. Pantaloon Retail Technologies Limited N.A. Yes N.A.
(for part of the year)
Key Management Personnel and Relatives

2006 2005 2004
1. Mr. Kishore Biyani – Managing Yes Yes Yes
Director;
2. Mr. Gopikishan Biyani – Whole time Yes Yes Yes
Director;
Page 139 of 144

3. Mr. Rakesh Biyani – Whole time Yes Yes Yes
Director;
4. Mr. Ved Prakash Arya – Director Yes Yes Yes
Operations & Chief Operating
Officer;
B ) Transaction with related Parties (Rs. Million )

Associate Companies/Joint Key Management
Nature of transactions
Ventures Subsidiary Companies Personnel & Relatives
2005-06 2004-05 2003-04 2005-06 2004-05 2003-04 2005-06 2004-05 2003-04
Sales and other Income 1469.16 13.58 0.07 - - - - - -
Purchase of raw material /stores 538.54 515.67 126.04 - - - - - -
Expenditure on services /Others 305.49 53.91 - - - - - - -
Managerial remuneration & Commission - - - - - - 42.30 24.26 13.60
Capital Purchases / Expenses - 4.71 1.59 - 14.12 - -
Interest on FCDs - - 6.25 - - - - 3.19 6.96
Loans given 124.70 - - - - - - - -
Advances given 26.14 - - - - - - - -
Deposit given 568.83 106.00 - - 3.65 - - - -
Investment 0.30 142.04 - - 88.43 - - - -
Share Application Money 28.84 - - - - - - - -
Outstanding balances
- - - - - -
Receivable 989.56 111.51 3.65
Payable 125.64 14.89 32.18 - - - - - 1.35
C) Joint Venture Information:

Joint Ventures, as required by AS-27 “Financial Reporting of Interest in Joint Venture” are given
below:
(i) Details of Joint Venture Interest
Description of Country of Percentage of Interest

Name
Interest Incorporation As on 30.06.06
Planet Retail Holding Limited Equity India 49%

G J Future Fashions Limited Equity India 50%
Gupta Infrastructure
Equity India 20%
(ii) Corporation’s Interest in the Joint Venture

Rs. Million
For the year
Name Assets Liabilities Income Expenditure
As on ended
Page 140 of 144

Planet Retail Holding
31.03.06 442.03 249.47 31.03.2006 493.88 484.74
Limited
G J Future Fashions
30.06.06 44.31 45.56 30.06.2006 12.51 17.00
Limited
Gupta Infrastructure 30.06.06 85.15 66.37 30.06.2006 Nil Nil
The Above figures are based on latest available unaudited accounts, except for GJ Future Fashions
Limited which were audited as on 30.06.2006.
11. Segment Report :

(Rs. Million )
Sr. Particulars Year Ended Year Ended Year Ended
No. 30.06.06 30.06.05 30.06.04
1. Segment Revenue
Value Retailing 12,948.02 5,990.40 3,127.26
Others 646.85 1,060.62 13.28
19,647.88 10,705.21 6,482.37
Less: Inter Segment Revenue 311.18 177.22 35.06
Net Sales/Income from Operation 19,336.71 10,527.99 6,447.31
2. Segment Profit
Profit Before Tax & Interest
Value Retailing 978.46 460.03 237.62
Lifestyle Retailing 913.00 598.21 385.06
1,891.46 1,058.24 622.67
Less: Interest 354.21 243.90 231.47
Other unallocable expenses net of 723.97 283.13 157.02
unallocable income
Total Profit Before Tax 813.28 531.21 234.19
3. Capital Employed
Value Retailing 6,556.48 2,700.11 1,456.06
Unallocated 1,820.77 450.54 97.96
Total Capital Employed 12,839.47 5,207.77 3,292.93
Notes:
(1) Segments have been identified in line with the Accounting Standards on Segment Reporting (As –
17), taking into account the company’s organisation structure as well as the differencial risk and
return of these segments.
(2) Segment Revenue, Results, and Capital Employed figures include the respective amounts identified
to each of the segments. Other unallocable figures includes expenses incurred at corporate level
which relates to the company as a whole. Unallocated assets mainly relates to long term
investments.
12. Earning Per Share

The calculation of Earning Per Share (EPS) as disclosed in the Balance Sheet Abstract has been made
in accordance with Accounting Standard (AS) - 20 on Earning Per Share issued by the Institute of
Chartered Accountants of India. A statement on calculation of diluted EPS is as under:
Page 141 of 144

UNITS 2005-2006 2004-2005 2003-2004
Profit after tax A Rs. Million 537.10 385.51 190.97
Add: Increased earning on account of interest savings - 7.20 8.29

on dilutive potential equity shares (net of taxes) Rs. Million
B Rs. Million 537.10 392.71 199.26
Weighted average number of equity shares C No.in Million 25.36 23.31 18.79
Add: Dilutive Potential Equity Shares No.in million - 1.82 1.91
Number of equity shares for dilutive EPS D No.in million 25.36 25.13 20.70
Earning per share
Basic (A/C) Rs. 21.18 16.54 10.16
Dilutive(B/D) Rs. 21.18 15.63 9.63
13. Deferred Tax Liability :

As per accounting Standard (AS – 22) on Accounting for Taxes on Income issued by the Institute of
Chartered Accountants of India (ICAI), the deferred tax liability (DTL) comprises of the following :
Rs. Million
Item 2005-2006 2004-2005 2003-2004
Deferred Tax Liability
Related to Fixed Assets 298.04 143.38 112.50
Deferred Tax Asset

Disallowance under the Income Tax
19.10 12.95 61.48
Act,1961/Unabsorbed Depreciation
Share in Jointly Controlled Entities 5.69 - -
Provision for Deferred Tax (net) 273.25 130.44 51.02
14. In July 2005, due to unprecedented rains in Maharashtra, there was flooding at some of the stores of
the company and job workers, the company suffered a loss of Rs.20.60 Million on account of stock and
Rs. 0.82 Million on account of repairs. Insurance claim of Rs. 21.43 Million was filed and company
has received an interim claim of Rs. 20.60 Million.
Further on account of small incident of fire at Ahmedabad Big Bazaar store, company has suffered a
loss of Rs.1.50 Million on account of repair and filed a claim of Rs.1.50 Million which is under
process.
Further there was a case of break-in at one store and cash of Rs. 4.52 Million was stolen, insurance
claim of Rs. 4.52 Million has been lodged and is being evaluated by insurers.
15. For certain items, the Company and its Joint Ventures have followed different accounting policies.
However, impact of the same is not material.
16. During the year 2004-05, there were five subsidiaries, all in the start up stage of business cycle and
since there were no material business transactions, accounts of these companies have not been
consolidated.
Page 142 of 144

DECLARATION
The Company certifies that all relevant provisions of Chapter XIII-A of the SEBI Guidelines have been
complied with and no statement made in this Placement Document is contrary to the provisions of Chapter
XIII-A of the SEBI Guidelines and that all approvals and permissions required to carry on our business
have been obtained, are currently valid and have been complied with. We further certify that all the
statements in this Placement Document are true and correct.
Kishore Biyani
Managing Director
Page 143 of 144

ISSUER
PANTALOON RETAIL (INDIA) LIMITED
REGISTERED OFFICE OF THE ISSUER

Pantaloon Knowledge House, Shyam Nagar,
Off. Jogeshwari Vikhroli Link Road,
Jogeshwari (East), Mumbai 400 060.
SOLE BOOKRUNNER
ENAM FINANCIAL CONULTANTS PRIVATE LIMITED
801/802, Dalamal Towers,
Nariman Point,
Mumbai 400 021.
LEGAL ADVISERS TO THE ISSUE

AMARCHAND & MANGALDAS & SURESH A. SHROFF & CO.
Peninsula Chambers
Peninsula Corporate Park
Ganpatrao Kadam Marg, Lower Parel
Mumbai 400 013
India
AUDITORS
M/S. NGS & CO.,
B/8 (Rear Entrance), Pravasi Industrial Estate
Vishweshwar Nagar Road, Goregaon (E)
Mumbai 400 063
Page 144 of 144

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PANTALOON RETAIL (INDIA) LIMITED

ISSUE IN RELIANCE UPON CHAPTER XIII-A OF THE SEBI GUIDELINES

ENAM FINANCIAL CONSULTANTS PRIVATE LIMITED

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

DISCLAIMER CLAUSE OF THE STOCK EXCHANGES

We publish our financial statements in Rupees.

• Change in the composition of cost of goods;

Definitions of Certain Capitalized Terms Used in this Placement Document

Memorandum/ The Memorandum of Association of our Company.

Abbreviation Full Form

Technical and Industry Terms and Abbreviations

Abbreviation Full Form

Aspirational Products Good quality and high priced lifestyle products

Our Competitive Strengths

We believe our competitive strengths include the following;

• Brand equity and early mover advantage;

• Entrepreneur led, professionally managed by an experienced team;

• Project execution and operations capabilities;

• Vast range of lifestyle and value retail products and services;

• Strong distribution and logistics network and supply chain;

• Large base of customers.

• Provide Everything, Everywhere, Everytime to Every Indian Consumer;

Total Profit Before Tax 579.31 192.31

Recent Corporate Announcements

The following is a general summary of the terms of the Issue:

Issuer Pantaloon Retail (India) Limited

Issue Price Rs. 415/- per Equity Share

Internal Risk Factors

The success of our business is dependent on supply chain management

Losses on account of shrinkage can negatively impact our profitability

We face the risk of potential liabilities from lawsuits or claims by consumers

External Risk Factors

Source: Market Price Information is sourced from Capital Line

Source: Market Price Information is sourced from Capital Line

Source: Market Price Information is sourced from Capital Line

The following table shows as at June 30, 2006:

• our actual capitalization;

As at June 30, As adjusted for As adjusted for

Total Shareholders’ Funds 5,346.24 5,544.49 8,144.49

Total Capitalization 1,2373.73 12,571.98 15,171.98

Fiscal 2006 Fiscal 2005 Fiscal 2004

Minority Interest 192.48 - -

DEFERRED TAX LIABILITY (NET) 273.25 130.44 51.02

TOTAL 12,839.47 5,207.77 3,348.07

GOODWILL (on consolidation) 58.15 - 0.24

CURRENT ASSETS, LOANS & ADVANCES

2,990.28 1,448.22 724.38

MISCELLANEOUS EXPENDITURE 0.56 2.76 4.12

PROFIT AND LOSS ACCOUNT

Sales & Operating Income 19,336.71 10,527.97 6,434.03

Profit Before Taxation 813.28 531.21 234.25

Add : Balance brought forward 651.96 380.81 329.48

Proposed Dividend 67.21 54.99 28.71

Gross Margin as % of Gross Sales 33.95% 33.48% 31.92%

Comparison of year ended 2006 with year ended 2005

Profit after tax as per Audited statement of Accounts

Comparison of year 2005 with year 2004

Profit after tax as per Audited statement of Accounts

Liquidity and capital resources

Current Assets, Loans and Advances

Loans and Advances