Hanung IPO Basis of Allotment

HANUNG TOYS AND TEXTILES LIMITED

(Originally Incorporated as on October 10, 1990 as 'Hanung Toys (India) Private Limited' under the Companies Act, 1956 at New Delhi. The name was changed to Hanung Toys (India) Limited on May 23,1996 and then subsequently to
Hanung Toys and Textiles Limited on January 9, 2006)
Registered Office: E-93, 2nd Floor, Greater Kallash Enclave, Part I, New Delhi-110 048; (For details on changes of our Registered Office, please refer to the chapter titled 'History and Other Corporate Matters' beginning on page 82 of the Prospectus.) Tel.: +91112624 2122; Fax: +91112624 1822.

BASIS OF ALLOCATION

PUBLIC ISSUE OF 95,00,000 EQUITY SHARES OF RS. 10/- EACH AT A PREMIUM OF RS. 85 PER EQUITY SHARE AND AT A PRICE OF RS. 95/- PER EQUITY SHARE FOR CASH AGGREGATING RS. 9025 LAKH (HEREINAFTER REFERRED TO AS 'THIS ISSUE'). THIS ISSUE COMPRISES OF RESERVATION OF 5,00,000 EQUITY SHARES AGGREGATING RS. 475 LAKH FOR ELIGIBLE EMPLOYEES ON A COMPETITIVE BASIS AND THE NET ISSUE TO THE PUBLIC OF 90,00,000 EQUITY SHARES OF FACE VALUE OF RS. 10/- EACH AT PREMIUM OF RS. 85 PER EQUITY SHARE AND AT A PRICE OF RS. 95 PER EQUITY SHARE FOR CASH AGGREGATING RS. 8550 LAKH. THE NET ISSUE WOULD CONSTITUTE 35.73% OF THE POST ISSUE PAID-UP CAPITAL OF OUR COMPANY
THE FACE VALUE PER EQUITY SHARE IS RS 10/-. THE ISSUE PRICE PER EQUITY SHARE IS RS. 95/- AND IT IS 9.5 TIMES THE FACE VALUE.

The Issue made through the 100% Book Building Process wherein up to 50% of the Issue was to be allocated on a proportionate basis to Qualified Institutional Buyers ('QIBs') (Including 5% of the 01B portion that was to specifically be allotted to mutual funds), further, not less than 15% of the Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 35% of the Issue shall be available for allocation on a proportionate basis to Retail Bidders, subject to valid bids being received at or above the Issue Price.

The Issue received 31,208 applications for 8,39,30,540 equity shares resulting In 8.83 times subscription. The details of the applications received in the Issue from Qualified Institutional Buyers, Non-Institutional, Employees of the Company and Retail Individual Investor categories areas under: (Before technical rejections)

Final Demand
A sample of the final demand at different bid prices is as under:

The Basis of Allocation was finalized in consultation with Bombay Stock Exchange Limited ('BSE') on 13 '' October, 2006.

A. Allocation to Employees (After Technical Rejections)
The Basis of Allocation to the Eligible Employees of the Company, who nave bid at cut-off or at and above the Issue Price of Rs.95/- per Equity Snare, was finalized in consultation with BSE. The category was subscribed to the extent of 0.28 times. Hence FULL and FIRM allotments nave been made against all valid applications The total number of 140940 equity snares were allotted In this category. The spill over portion of 359060 equity snares has been added to Qualified Institutional Bidders, Non-Institutional Investors and Retail Individual Investors categories in the ratio of 50:15:35.

B.Allocation to Retell Individual Investors (After Technical Rejections)
The Basis of Allocation to the Retail Individual Investors, who nave bid at cut-off or at the Issue Prioe of Rs.95/- per Equity Snare, was finalized in consultation with BSE. The category was oversubscribed 4.44 times. The total number of snares allotted in this category is 3275671 Equity Shares. The category-wise details of the Basis of Allocation are as under:

C. Allocation to Non Institutional Investors (After Technical Rejections)
The Basis of Allocation to the Non institutional Investors, who have bid at the Issue Price of Rs.95/- per Equity Share, was finalized in consultation with BSE. The category was subscribed 9.88 times. The total number of shares allotted in this category is 1403859 Equity Shares. The category-wise details of the Basis of Allocation (Sample) are as under:

D. Allocation to QIBs
Allocation to QIBs has been done on a proportionate basis in consultation with BSE. As per the SERI guidelines, Mutual Funds were initially allotted 5% of the quantum of shares available (2,33,977) and other QIBs-and unsatisfied demands of Mutual Funds were allotted the remaining available shares (44,45,553) on proportionate basis.

Pursuant to Clause 6.8.3.2 (g) of the SEBI (Disclosure and Investor Protection Guidelines), 2000 and Item no. 20 of the Notes to the Capital Structure (page no. 23) of the Prospectus dated October 10, 2006 the Company has rounded-off fractional Equity Shares to the nearest multiple of one (1) Equity Share.

The Board of Directors of the company at it's Meeting held at the Corporate Office of the Company at 108-109, NSEZ, Industrial Area- Phase II, NOIDA (UP), on 14' October, 2006 has approved the basis of allocation of shares of the Issue and has allotted the shares to various successful applicants.

The Refund Orders and allotment advice and notice has been dispatched to the address of the investors as registered with the depositories. In case the same is not received within ten days, investors may contact at the address given below. The Refund Orders have been over-printed with the Bank Mandate details as registered, n any, with the depositories. The shares allocated to successful applicants are being credited to their beneficiary accounts subject to validation of the account details with the depositories concerned. The company is taking steps to get the equity shares admitted for trading on Bombay Stock Exchange Limited and National Stock Exchange of India Limited within seven working days from the date of approval of the basis of allocation.

INVESTORS PLEASE NOTE
This details of the allocation made would be hosted on the website of Registrars to the Issue, Darvy Computershare Private Limited at www.karvy.com or http://kcpl.karvy.com
All  future correspondence in this regard may kindly be addressed to the Registrars to the issue quoting full name of the First/ Sole applicant, Serial number of the bid-cumapplication form, number of shares bid for, name of the Member of the Syndicate and Place where the bid was submitted and payment details at the address given below:

Karvy Computershare Private Limited
Unit: Hanung Toys, Karvy House, 46, Avenue 4, Street No.1,
Banjara Hills, Hyderabad-500034, Fax: 040-23420814
Email: hanung.ipo@karvy.com   and mailmanager@karvy.com

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