Shekhawati Poly-yarn

Statement of Justification

And

Qualitative Analysis

Introduction
Shekhawati Poly-Yarn Limited was originally incorporated on November 5,
1990 as a Private Limited Company. The Company was taken over by Mr.
Mukesh Ruia and Mr. Ramniranjan Ruia in 1993.
The company has been in the Polyester Industry for more than a decade
and since incorporation has been engaged solely into the manufacture of
Polyester Texturised Yarn (PTY), which is used in the process of weaving of
fabric used for suiting, shirting, dress materials, saris, hosiery, knitted
fabric, zipper fastener, curtain & industrial cloth as also to manufacture
fancy yarn for high value dress materials and upholstery.
Later, it was converted into a Public Limited Company by passing a
Special Resolution at the Extra Ordinary General Meeting of the Company
held on 27th Feb, 2010. It went ahead with an Initial Public Offer in
December 2010. (Issue open 27th Dec – Issue close Dec 29th).

The listing happened on January 12th 2011.

The Closing Share Prices for a few dates following the IPO are as follows:

Jan 12: Rs 47.5

Jan 13: Rs 38.05
Jan 14: Rs 30.45
Jan 17: Rs 27.45
Jan 18: Rs 25.55
Jan 19: Rs 25.50
Jan 20: Rs 23.25
Jan 21: Rs 22.90

Note: The issue was at Rs 30 i.e. at a premium of Rs 20. The point to be

noted is that except the first few moments of opening the share was
always on a decline. On the first three days of trade the stock was frozen
for transaction as the drop was more than……………………..

Qualitative Analysis

Management
SPL is promoted by Mr. Sajjan Kumar Jain, Mr. Rajneesh N Jain, Mr.Ratanlal
Jain and Mr. Rajesh Kumar Jain. It was taken over by Mr. Ramniaranjan
Ruia and Mr. Mukesh Ruia in 1993. Mr. Ramniranjan Ruia, Chairman, has
over four decades of experience in the textile industry and Mr.Mukesh
Ruia , Managing director, has vast expertise of over 18 years in textile
industry.

SPL does not have any pending litigations as on March 31, 2010

Corporate Governance
Currently board has 6 directors whereas chairman of the board is a non
independent and executive director. Complies with clause 49 of listing
agreement. SPL has constituted prescribed committees such as Audit
committee and the remuneration and the shareholders grievance
committee. SPL is not registered under section 5 of the Maharashtra State
tax on Professions, Trades, Callings and employment act, 1975 and has
not followed AS -15 regarding employees’ benefits prescribed by ICAI.
Promoting Financials : With CAGR of 65%