Our Company Has Eight Acres in Promoter-Linked Land Leases

Our Company has eight acres under three 33-year land leases from promoter-linked HMC E-Valley Private Limited, alongside short-term office leases from Hero Cycles Limited. The disclosure identifies overlapping directorships at the property counterparties, while the four promoters held 73.46% of Our Company’s fully diluted equity capital at the Red Herring Prospectus date.

Which promoter-linked entities provide property to Our Company?

Hero Cycles Limited and HMC E-Valley Private Limited provide the promoter-linked property disclosed for Our Company and its subsidiaries. Hero Cycles Limited is listed as a promoter-group entity, while HMC E-Valley Private Limited, formerly Hero E-Cycles Private Limited, is the lessor under all three 33-year subsidiary land leases described on pages 342 and 343.

The overlap is explicit in the prospectus. Pankaj Munjal and Abhishek Munjal are promoters of Our Company and directors of HMC E-Valley Private Limited; Amit Gupta, Ashok Kumar Taneja and Kulbir Singh, who are directors of Our Company, also serve as directors of HMC E-Valley Private Limited. The four promoters, comprising Pankaj Munjal, Charu Munjal, Abhishek Munjal and O P Munjal Holdings, held 284,172,126 equity shares, or 73.46% of fully diluted issued, subscribed and paid-up capital.

Hero Cycles Limited’s status changed after the 2022 Scheme of Arrangement. Before the National Company Law Tribunal, Chandigarh Bench approved the scheme on November 4, 2022, Hero Cycles Limited held 97.58% of Our Company and was identified as a promoter; after the scheme, it remained a promoter-group entity while the four named promoters were identified under applicable law.

Why does Our Company rely on promoter-linked land leases?

Our Company relies on promoter-linked land leases because three subsidiaries occupy eight acres supplied by HMC E-Valley Private Limited under 33-year agreements. The arrangements cover two acres for HYM Drive Systems Private Limited, three acres for Spur Technologies Private Limited and three acres for Munjal STP Industries Private Limited, rather than one combined group lease.

HYM Drive Systems Private Limited, referred to as HYM, entered its lease deed on August 23, 2022 for two acres at Block A, Plot A01A in Hero Industrial Park, Village Dhanssu, District Ludhiana. The 33-year term commenced on June 15, 2022, and the disclosed plot includes portions of specified Khasra numbers, which are land-survey identifiers.

Spur Technologies Private Limited, referred to as STPL, leases three acres at Plot A01A in Hero Industrial Park, Village Dhanansu, District Ludhiana, for 33 years from February 7, 2022. The prospectus records the agreement date as “21, 2022” without specifying a month. Munjal STP Industries Private Limited, referred to as MSIPL, leased a further three acres at Block B, Plot A-01(B)-01, Hero Industrial Park, under a December 9, 2025 deed commencing October 29, 2025.

How do the office and registered-office leases work?

Our Company and STPL use 11-month premises leased from Hero Cycles Limited, while MSIPL rents registered-office space from Our Company. These shorter arrangements differ from the 33-year HMC E-Valley Private Limited land leases in duration, area and stated purpose.

Our Company’s August 14, 2026 lease deed with Hero Cycles Limited covers part of its Hero Nagar, GT Road, Ludhiana premises for business use and Our Company’s registered office. The lease took effect on July 1, 2026 at Rs 7,500 per month for 11 months. Pankaj Munjal is described as a promoter and director of Hero Cycles Limited, and Abhishek Munjal as one of its directors.

STPL’s January 19, 2026 lease deed covers 25 square feet at Two Horizon Centre, Sector 43, DLF Phase V, Gurugram, for its registered office. It began on January 1, 2026, runs for 11 months and carries rent of Rs 5,000 per month. Separately, MSIPL rents about 221 square feet at Our Company’s Phase-8, Focal Point premises in Ludhiana for Rs 5,000 per month from June 22, 2026 for 11 months; Abhishek Munjal and Amit Gupta are directors of MSIPL.

What other property transaction links Our Company to Hero Cycles Limited?

Our Company also acquired land and a building from Hero Cycles Limited, so the disclosed property relationship extends beyond leasing. A sale deed dated October 8, 2024 covered property at Chandigarh Road, Focal Point, Phase-8, Village Mangli, Ludhiana, for total consideration of Rs 20.538 crore in Financial Year 2024.

The prospectus directs readers to a risk factor stating that a portion of the land where the Mangal Facility in Ludhiana is located remains to be registered in Our Company’s favour. Pages 342 and 343 do not quantify that portion or give a registration completion date. The ownership transaction therefore differs from the three HMC E-Valley Private Limited arrangements, which are leases with stated 33-year periods.

Our Company states that, except for the disclosed matters, its promoters have no interest in property acquired in the preceding three years or proposed to be acquired, or in transactions involving land acquisition, building construction or machinery supply. It also says no amount or benefit was paid or given to promoters or promoter-group members in the two years before the Red Herring Prospectus filing, except as disclosed.

What must hold for these arrangements to continue?

The three land leases must continue under their stated 33-year terms for the current eight-acre arrangement to persist. Their commencement dates range from February 7, 2022 to October 29, 2025, but the disclosed pages do not state rent, renewal options, termination conditions or replacement-site plans for any of the three leases.

The office arrangements have nearer stated endpoints because each lasts 11 months. The Hero Cycles Limited lease for STPL began on January 1, 2026, the MSIPL arrangement began on June 22, 2026, and Our Company’s Hero Cycles Limited lease began on July 1, 2026. Continuation after those terms would depend on a renewal, replacement site or new agreement not disclosed on pages 342 and 343.

Conclusion

Our Company’s disclosures identify a related-party property structure comprising eight acres under three long-term subsidiary leases from HMC E-Valley Private Limited, short-term office arrangements involving Hero Cycles Limited, and a Rs 20.538 crore property acquisition from Hero Cycles Limited. The structure is linked to named promoter and director overlaps, alongside promoter ownership of 73.46% of fully diluted equity capital.

The next disclosed milestones are the end dates of the 11-month office arrangements and the unresolved registration of part of the Mangal Facility land. The prospectus does not disclose renewal terms for the office leases, commercial terms for the 33-year land leases, or a date for completing the Mangal Facility registration.