The Equity Shares being offered are subject to the provisions of the Companies Act, the Memorandum and Articles of Association of our Company, conditions of RBI approval, if any, the terms of the Draft Red Herring Prospectus, Red Herring Prospectus and Prospectus, Bid cum Application Form, ASBA Bid cum Application Form, the Revision Form, the Confirmation of Allocation Note (“CAN”), the Listing Agreement with the Stock Exchanges and other terms and conditions as may be incorporated in the Allotment advice, and other documents/certificates that may be executed in respect of the Issue. The Equity Shares shall also be subject to laws as applicable, guidelines, notifications and regulations relating to the issue of capital and listing and trading of securities issued from time to time by SEBI, GoI, Stock Exchanges, RBI, ROC, FIPB and / or other authorities, as in force on the date of the Issue and to the extent applicable.
Ranking of Equity Shares
The Equity Shares being offered shall be subject to the provisions of the Companies Act, Memorandum and Articles of Association and shall rank pari passu in all respects with the other existing shares of our Company including in respect of the rights to receive dividends. The Allottees of the Equity Shares in the Issue shall be entitled to dividends and other corporate benefits, if any, declared by our Company after the date of Allotment. For further details, see the chapter titled “Main Provisions of the Articles of Association” on page no. 199 of the Draft Red Herring Prospectus.
Mode of payment of dividend
We shall pay dividend to our shareholders as per the provisions of the Companies Act, the Articles and the Listing Agreement.
Face Value and Issue Price
The face value of each Equity Share is ` 10. The Floor Price of the Equity Shares is ` [●] per Equity Share and the Cap Price is ` [●] per Equity Share. At any given point of time there shall be only one denomination of Equity Shares, subject to applicable law. The Issue Price is [●] times the Face Value of the Equity Shares.
Price Band
The Price Band shall be from ` [●] to ` [●] per Equity Share of face value of ` 10 each. Compliance with SEBI Rules and Regulations
Our Company shall comply with all applicable disclosure and accounting norms as specified by SEBI from time to time.
Rights of the Equity Shareholder
Subject to applicable laws, the equity shareholders of our Company shall have the following rights: Right to receive dividend, if declared;
Right to attend general meetings and exercise voting powers, unless prohibited by law; Right to vote on a poll either in person or by proxy;
Right to receive offers for rights shares and be allotted bonus shares, if announced;
Right to receive surplus on liquidation subject to any statutory and other preferential claims being satisfied; Right of free transferability of Equity Shares; and
Such other rights, as may be available to a shareholder of a listed public company under the Companies Act the terms of the Listing Agreement executed with the Stock Exchanges, and the Memorandum and Articles of Association of our Company.
161 For a detailed description of the main provisions of the Articles of Association such as those dealing with voting rights, dividend, forfeiture and lien, transfer and transmission and / or consolidation / splitting, please refer to the chapter titled “Main Provisions of the Articles of Association” on page no. 199 of the Draft Red Herring Prospectus.
Market Lot
Under section 68B of the Companies Act, the Equity Shares shall be allotted only in dematerialized form. In terms of existing SEBI (ICDR) Regulations, the trading in the Equity Shares shall only be in dematerialized form for all investors. Since trading of the Equity Shares is in dematerialized mode, the tradable lot is one Equity Share. Allocation and Allotment of Equity Shares through the Issue will be done only in electronic form, in multiple of one Equity Share, subject to a minimum allotment of [●] Equity Shares. For details of allocation and allotment, please refer to the chapter titled “Issue Procedure” on page no. 167 of the Draft Red Herring Prospectus.
Joint Holders
Where two or more persons are registered as the holders of any Equity Shares, they shall be deemed to hold the same as joint-tenants with benefits of survivorship.
Jurisdiction
Exclusive jurisdiction for the purpose of the Issue is with the competent courts/authorities in Mumbai, India. Nomination Facility to the Investor
In accordance with section 109A of the Companies Act, the sole or first bidder, along with other joint bidder, may nominate any one person in whom, in the event of the death of sole bidder or in case of joint bidders, death of all the bidders, as the case may be, the Equity Shares allotted, if any, shall vest. A person, being a nominee, entitled to the Equity Shares by reason of the death of the original holder(s), shall in accordance with section 109A of the Companies Act, be entitled to the same advantages to which he or she would be entitled if he or she were the registered holder of the Equity Share(s). Where the nominee is a minor, the holder(s) may make a nomination to appoint, in the prescribed manner, any person to become entitled to equity share(s) in the event of his or her death during the minority. A nomination shall stand rescinded upon a sale / transfer / alienation of equity share(s) by the person nominating. A buyer will be entitled to make a fresh nomination in the manner prescribed. Fresh nomination can be made only on the prescribed form available on request at our Company’s Registered Office or to our Registrar and Transfer Agents.
In accordance with section 109B of the Companies Act, any person who becomes a nominee by virtue of the provisions of section 109A of the Companies Act, shall upon the production of such evidence as may be required by the Board, elect either:
to register himself or herself as the holder of the Equity Shares; or
to make such transfer of the Equity Shares, as the deceased holder could have made.
Further, the Board may at any time give notice requiring any nominee to choose either to be registered himself or herself or to transfer the Equity Shares, and if the notice is not complied with within a period of ninety days, the Board may thereafter withhold payment of all dividends, bonuses or other monies payable in respect of the Equity Shares, until the requirements of the notice have been complied with.
Since the allotment of Equity Shares in the Issue will be made only in dematerialized mode, there is no need to make a separate nomination with our Company. Nominations registered with respective depository participant of the applicant would prevail. If the investors require changing the nomination, they are requested to inform their respective depository participant.
162 Bidding Period
Bidders may submit their Bids only in the Bidding Period. The Bid/Issue Opening Date is [●] and the Bid/Issue Closing Date is [●].
Minimum Subscription
If we do not receive the minimum subscription of 90% of the Issue through the Draft Herring Prospectus including devolvement of Underwriters within 60 days from the date of closure of the Issue, our Company shall forthwith refund the entire subscription amount received. If there is a delay beyond eight days after our Company becomes liable to pay the amount, our Company shall pay interest as prescribed under section 73 of the Companies Act. Further, in accordance with Clause 26(4) of the SEBI (ICDR) Regulations, our Company shall ensure that the number of prospective allottees to whom the Equity Shares will be allotted will be not less than 1,000.
Withdrawal of the Issue
Our Company, in consultation with the BRLM reserves the right not to proceed with the Issue at any time, after the Bid / Issue Opening Date, but before Allotment of Equity Shares. In such an event our Company would issue a public notice in the newspapers, in which the pre Issue advertisements were published within two days of the Bid / Issue Closing Date providing reasons for not proceeding with the Issue. Our Company shall also promptly inform the same to the Stock Exchanges on which our Equity Shares are proposed to be listed. Any further issue of Equity Shares by our Company shall be in compliance with applicable laws. If the Issue is withdrawn after the Bid / Issue Closing date, our Company shall be required to file a fresh offer document with SEBI. The BRLM, through the Registrar to the Offer, shall notify the SCSBs to unblock the bank accounts of the ASBA Bidders within one day from the day of receipt of such notification.
Notwithstanding the foregoing, the Issue is also subject to obtaining (i) the final listing and trading approvals of the Stock Exchanges, which our Company shall apply for after Allotment and (ii) the final ROC approval of the Prospectus after it is filed with the ROC.
Arrangement for disposal of odd lot
The Equity Shares will be traded in dematerialized form only and therefore the marketable lot is one (1) Equity Share. Hence, there is no possibility of any odd lots.
Application by Eligible NRIs, FIIs and Foreign Venture Capital Funds registered with SEBI
As per the extant policy of the Government of India, OCBs cannot participate in the Issue. The current provisions of the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000, there exists a general permission for the NRIs, FIIs and FVCIs registered with SEBI to invest in shares of Indian companies by way of subscription in an IPO. However, such investments would be subject to other investment restrictions under the Foreign Exchange Management (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000, RBI and / or SEBI regulations as may be applicable to such investors. It is to be distinctly understood that there is no reservation for NRIs, FIIs or FCVIs registered with SEBI, applicants will be treated on the same basis with other categories for the purpose of allocation.
The allotment of the Equity Shares to Non-Residents shall be subject to the conditions, if any, as may be prescribed by the Government of India/RBI while granting such approvals.
The Equity Shares have not been and will not be registered under the U.S. Securities Act of 1933, (the “Securities Act”) or any state securities laws in the United States and may not be offered or sold within the United States or to, or for the account or benefit of, “U.S. persons” (as defined in Regulation S under the Securities Act). The Equity Shares shall be sold only outside the United States in compliance with Regulation S and the applicable laws of the jurisdiction where those offers and sales occur.
163 The above information is given for the benefit of the Bidders. The Bidders are advised to make their own enquiries about the limits applicable to them. Our Company and the BRLM do not accept any responsibility for the completeness and accuracy of the information stated hereinabove. Our Company and the BRLM are not liable to inform the investors of any amendments or modifications or changes in applicable laws or regulations, which may occur after the date of the Draft Red Herring Prospectus. Bidders are advised to make their independent investigations and ensure that the number of Equity Shares Bid for do not exceed the applicable limits under laws or regulations.
Restriction on Transfer of Shares
There are no restrictions on transfers and transmission of shares/ debentures and on their consolidation / splitting except as provided in the Draft Red Herring Prospectus and in the Articles of Association of our Company. For further details refer to chapter titled “Main Provisions of the Articles of Association” on page no. 199 of the Draft Red Herring Prospectus.
Pursuant to the existing regulations, OCBs are not eligible to participate in the Issue. Further, NRIs who are not Eligible NRIs are not permitted to participate in the Issue. Equity Shares acquired by Eligible NRIs can be only sold to any other person eligible to acquire the same in accordance with all applicable laws, rules and regulations. Sub accounts of FIIs registered with SEBI, being foreign corporate or foreign individuals are not eligible to participate in the Issue in the QIB Portion.
The Equity Shares have not been and will not be registered, listed or otherwise qualified in any other jurisdiction outside India and may not be offered or sold, and Bids may not be made by persons in any such jurisdiction, except in compliance with the applicable laws of such jurisdiction.
The Equity Shares have not been and will not be registered under the US Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold within the United States (as defined in Regulation S under the Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. The Equity Shares are being offered and sold only outside the United States in offshore transactions in compliance with Regulation S under the Securities Act and the applicable laws of the jurisdictions where those offers and sales occur.
Issue of Equity Shares in dematerialized form in the Issue
In accordance with the SEBI (ICDR) Regulations, Equity Shares will be issued, transferred 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.
164 ISSUE STRUCTURE
The present Issue is of 39,00,000 Equity Shares of ` 10 each for cash at a price of ` [●] per Equity Share (including a share premium of ` [●] per Equity Share) aggregating to ` [●] lakhs. The Issue will constitute 27.24% of the post Issue paid-up capital of our Company. Our Company is considering a Pre-IPO Placement of up to 3,00,000 Equity Shares aggregating up to ` 450 lakhs with various investors. If the Pre-IPO Placement is completed the Issue size offered to the public would be reduced by the extent of such Pre-IPO Placement, subject to a minimum Issue size of 25% of the post Issue paid-up equity share capital of our Company. The Equity Shares allotted under the Pre - IPO Placement, if completed, shall be subject to a lock - in period of one (1) year from the date of the Allotment pursuant to the Issue.
The Issue is being made through the 100% Book Building Process. This Issue is being made in compliance with Rule 19(2)(b) of SCRR wherein not less than 25% of the Post Issue Paid up Capital shall be offered for subscription to the public through Red Herring Prospectus.
Particulars QIBs Non-Institutional
Bidders
Retail Individual Bidders Number of Equity Shares
available for allocation.
Not less than [•] Equity Shares (of which [qu Equity Shares shall be available for allocation to Mutual Funds).
Not more than [•] Equity Shares or Issue size less allocation to QIB Bidders and Retail Individual Bidders shall be available for allocation. *
Not more than [•] Equity Shares or Issue size less allocation to QIB Bidders and Non Institutional Bidders shall be available for allocation.*
Percentage of Issue Size available for Allotment/ Allocation*.
Atleast 50% of the Issue (of which 5% shall be available for allocation to Mutual Funds).
Mutual Funds participating in the 5% reservation in the QIB Portion will also be eligible for allocation in the remaining QIB Portion. The unsubscribed portion in the Mutual Fund reservation will be available to QIBs.
Not more than 15% of the Issue or the Issue less allocation to the QIB Bidders and Retail Individual Bidders shall be available for allocation. *
Not more than 35% of the Issue or the Issue less allocation to the QIB Bidders and Non Institutional Bidders shall be available for allocation.* Basis of proportionate Allotment/Allocation if respective category is oversubscribed**. Proportionate as follows: a) Equity Shares shall be allocated on a proportionate basis to
Mutual Funds; and b) The balance Equity Shares shall be allotted on a proportionate basis to all QIBs including Mutual Funds receiving allocation as per (a) above.
Proportionate Proportionate
Minimum Bid Such number of Equity
Shares that the Bid Amount exceeds ` 2,00,000.
Such number of Equity Shares that the Bid Amount exceeds ` 2,00,000.
[●] Equity Shares
Maximum Bid Not exceeding the size of
the Issue subject to applicable limits.
Not exceeding the size of the Issue subject to applicable limits.
Such number of Equity Shares whereby Bid Amount does not exceed ` 2,00,000.
165
Mode of Allotment Compulsorily in
dematerialized form.
Compulsorily in dematerialized form.
Compulsorily in dematerialized form.
Bid Lot [●] Equity Shares and in
multiples of [●] Equity Shares thereafter.
[●] Equity Shares and in multiples of [●] Equity Shares thereafter.
[●] Equity Shares and in multiples of [●] Equity Shares thereafter.
Allotment Lot [●] Equity Shares and in
multiples of one thereafter
[●] Equity Shares and in multiples of one thereafter
[●] Equity Shares and in multiples of one thereafter
Trading Lot/ Market Lot One Equity Share. One Equity Share. One Equity Share.
Who can Bid A mutual fund, venture
capital fund and foreign venture capital investor registered with SEBI; a foreign institutional investor and sub- account (other than a sub- account which is a foreign corporate or foreign individual), registered with SEBI; a public financial institution as defined in section 4A of the Companies Act, 1956; a scheduled commercial bank; a multilateral and bilateral development financial institution; a start industrial development corporation; an insurance company registered with the Insurance Regulatory and Development Authority (IRDA); provident funds with minimum corpus of ` 2500 lakhs; pension funds with minimum corpus of ` 2500 lakhs; National Investment Fund set up by resolution no. F.No. 2/3/2005-DDII dated November 23, 2005 of the Government of India published in the Gazette of India; and Insurance funds set up and managed by army, navy or air force of the Union of India.
Resident Indian individuals, eligible NRIs, HUF, applying through their Karta, minors applying through their natural guardian companies, corporate bodies, scientific institution, societies, trust, sub- accounts of FIIs registered with SEBI, which are foreign corporates or foreign individuals.
Resident Indian individuals (including HUF, applying through their Karta, minors applying through their natural guardian) and Eligible NRIs applying for Equity Shares such that the Bid Amount does not exceed ` 2,00,000 in value.
Terms of Payment Bid Amount shall be