RED HERRING PROSPECTUS Dated August 24 ... - Globus Spirits
RED HERRING PROSPECTUS Dated August 24 ... - Globus Spirits
RED HERRING PROSPECTUS Dated August 24 ... - Globus Spirits
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Defence Services. Thus, the brand will have the requisite presence in the CSD market as<br />
well. The Company plans to simultaneously make its presence felt in the civil market too.<br />
14. The Company lacks adequate distribution network for its products in the IMFL<br />
segment<br />
Inability to create a credible distribution channel will hamper the Company’s ability to push<br />
its products aggressively to its target consumers thereby slowing the pace of its business<br />
growth.<br />
Management Perception<br />
In Haryana, Rajasthan, Chandigarh and Uttar Pradesh the distribution network/channel that<br />
has been developed for Country Liquor is proposed to be used for IMFL products. In<br />
Karnataka, Kerala and Andhra Pradesh, the Company is distributing its products through<br />
distributors who are well acquainted with the IMFL market. In CSD supplies, as an<br />
established CSD registered brand is proposed to be acquired, no additional expenditure for<br />
promotions is likely to be required. In the civil market, a new IMFL team is being built to set<br />
in place a marketing distribution network.<br />
15. The Company is involved in the following legal proceedings:<br />
The Company is involved in certain civil, regulatory and other proceedings. These legal<br />
proceedings are pending at different levels of adjudication before various courts and<br />
tribunals. Should any new developments arise, such as a change in Indian law or rulings<br />
against the Company by trial or appellate courts or tribunals, the Company may need to<br />
make provisions in its financial statements, which could increase its expenses and its current<br />
liabilities. The Company can give no assurance that these legal proceedings will be decided<br />
in its favour. Any adverse decision may have a significant effect on its business and results<br />
of operations.<br />
A classification of the legal proceedings instituted against the Company and the<br />
monetary amount involved in these cases is given in the following table:<br />
Type of Litigation<br />
Writ Petitions against<br />
the amendment of<br />
the Excise and liquor<br />
sourcing policy<br />
implemented by<br />
State of Rajasthan<br />
(1st Case)<br />
Amount<br />
Involved<br />
(Rs. in lakhs)<br />
Not quantifiable<br />
Status<br />
The petitioners have filed the writ petition<br />
against the amendment of the excise and<br />
liquor sourcing policy for the Year 2005-06<br />
and 2006-07 implemented by the State of<br />
Rajasthan whereby a licensee of country<br />
liquor is compulsorily required to obtain his<br />
requirement of liquor from the Respondents<br />
distilleries, and the fact that only three<br />
private distilleries (one of them being<br />
<strong>Globus</strong>) and the government distillery were<br />
permitted to obtain rectified spirit from<br />
outside the state of Rajasthan and none<br />
else. The Petitioners claim is that the policy<br />
is arbitrary and clearly aims at creating a<br />
monopoly in favour of the Respondents.<br />
Pending for final hearing. Date to be fixed<br />
later on. As per the information available online<br />
on the website of Hon’ble Rajasthan<br />
High Court, notice has been issued on April<br />
23, 2009, however, the same and/or its<br />
service is incomplete.<br />
Writ Petitions against<br />
the amendment of<br />
Not quantifiable<br />
The petitioners have filed the writ petition<br />
against the amendment of the excise and<br />
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