LOHA ISPAAT LIMITED Our Company Was Incorporated As Loha Ispat Private Limited on December 20, 1988 Under the Companies Act, Bearing Registration No
Total Page:16
File Type:pdf, Size:1020Kb
CMYK Draft Red Herring Prospectus Dated: December 14, 2012 (The Draft Red Herring Prospectus will be updated upon filing with the RoC) Please read Sections 60 and 60B of the Companies Act, 1956 Book Building Issue LOHA ISPAAT LIMITED Our Company was incorporated as Loha Ispat Private Limited on December 20, 1988 under the Companies Act, bearing Registration No. 050107 having its Registered Office in Mumbai, Maharashtra. For further details regarding the changes in our name and registered office, kindly refer to the Chapter titled “History and Certain Corporate Matters” beginning on page 146 of this Draft Red Herring Prospectus. The Company’s Corporate Identity Number is U27200MH1988PLC050107. Registered and Corporate Office: 9th Floor, Naman Centre, C-31, Bandra Kurla Complex, Bandra (East), Mumbai 400051. Tel.: +91 22 67577000; Fax: +91 22 67577001; Email: [email protected]; Website: www.loha.in Company Secretary and Compliance Officer:Ms. Shobhana Sinkar PROMOTER OF THE COMPANY: MR. RAJESH PODDAR PUBLIC ISSUE OF 30,241,320# EQUITY SHARES OF A FACE VALUE ` 10 EACH OF LOHA ISPAAT LIMITED (THE “COMPANY” OR THE “ISSUER”) FOR CASH AT A PRICE OF ` [●] PER EQUITY SHARE (INCLUDING A SHARE PREMIUM OF ` [●] PER EQUITY SHARE) AGGREGATING TO ` [●] MILLION (THE “ISSUE”). THE ISSUE WILL CONSTITUTE 29.94% OF THE POST-ISSUE PAID-UP EQUITY SHARE CAPITAL OF THE COMPANY. #Our Company is also considering a Pre-IPO Placement of up to 4,900,000 Equity Shares aggregating upto ` [●] million (“Pre-IPO Placement”). The Pre-IPO Placement is at the discretion of our Company. Our Company will complete the issuance and allotment of such Equity Shares prior to the filing of the Red Herring Prospectus with the RoC. If the Pre-IPO Placement is completed, the Issue size offered to the public would be reduced to the extent of such Pre-IPO Placement, subject to a minimum Issue size of 25% of the post Issue paid-up capital being offered to the public. 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. PRICE BAND: ` [●] TO ` [●] PER EQUITY SHARES OF FACE VALUE ` 10 EACH. THE PRICE BAND & THE MINIMUM BID LOT WILL BE DECIDED BY THE COMPANY IN CONSULTATION WITH THE BOOK RUNNING LEAD MANAGER (THE “BRLM”) AND WILL BE ADVERTISED AT LEAST FIVE WORKING DAYS PRIOR TO THE BID/ISSUE OPENING DATE. In case of any revision in the Price Band, the Issue Period shall be extended for a minimum three additional Working Days after such revision of the Price Band, subject to the total Issue Period not exceeding 10 Working Days. Any revision in the Price Band, and the revised Issue Period, if applicable, shall be widely disseminated by notification to the BSE Limited (the “BSE”) and the National Stock Exchange of India Limited (the “NSE”), by issuing a press release, and also by indicating the change on the websites of the Book Running Lead Manager and at the terminals of the other members of the Syndicate and by intimation to Self Certified Syndicate Banks (“SCSBs”). This Issue is being made in terms of regulation 26(1) of the SEBI (ICDR) Regulations, 2009 (as amended from time to time), through the 100% Book Building Process wherein 10% of the Issue shall be available for allocation on a proportionate basis to Qualified Institutional Buyers (“QIB”) Bidders. 5% of the QIB Portion (excluding Anchor Investor Portion) shall be available for allocation on a proportionate basis to Mutual Funds only, and the remainder of the QIB Portion shall be available for allocation on a proportionate basis to all QIB Bidders, including Mutual Funds, subject to valid Bids being received at or above the Issue Price. Further, not less than 30% of the Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 60% of the Issue shall be available for allocation to Retail Individual Bidders. The allotment of Equity Shares to each retail individual bidder shall not be less than the minimum bid lot, subject to availability of shares in retail individual bidder category, and the remaining available shares, if any, shall be allotted on a proportionate basis, subject to valid Bids being received at or above the Issue Price. Potential investors, other than Anchor Investors, may participate in the Issue through an Application Supported by Blocked Amount (“ASBA”) process providing details about the bank account which will be blocked by the Self Certified Syndicate Banks (“SCSBs”) for the same. For details, kindly refer to the Section titled “Issue related Information” beginning on page 270 of this Draft Red Herring Prospectus. RISKS IN RELATION TO THE FIRST ISSUE This being the first issue of Equity Shares of our Company, there has been no formal market for the Equity Shares of our Company. The Face Value of the Equity Shares is ` 10 each and the Floor Price and the Cap Price is [●] times and [●] times of the Face Value respectively. The Issue Price (as determined by our Company in consultation with the Book Running Lead Manager (“BRLM”) as stated in “Basis for Issue Price” beginning on page 76 of this Draft Red Herring Prospectus) should not be taken to be indicative of the market price of the Equity Shares after the Equity Shares are listed. No assurance can be given regarding an active and/or sustained trading in the Equity Shares of our Company or regarding the price at which the Equity Shares will be traded after listing. GENERAL RISKS Investment in equity and equity related securities involves a degree of risk and investors should not invest any funds in this Issue unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this Issue. For taking an investment decision, investors must rely on their own examination of our Company and the Issue including the risks involved. The Equity Shares offered in the Issue have not been recommended or approved by the Securities and Exchange Board of India (“SEBI”) nor does SEBI guarantee the accuracy or adequacy of this Draft Red Herring Prospectus. Specific attention of the investors is invited to the Section titled “Risk Factors” beginning on page 12 of this Draft Red Herring Prospectus. ISSUER’S ABSOLUTE RESPONSIBILITY Our Company having made all reasonable inquiries, accepts responsibility for, and confirms that this Draft Red Herring Prospectus contains all information with regard to our Company and the Issue, which is material in the context of this Issue; that the information contained in this Draft Red Herring Prospectus is true and correct in all material respects and is not misleading in any material respect; that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this document as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect. IPO GRADING This Issue has been graded by [●] as [●], indicating [●]. The rationale furnished by the grading agency for its grading, will be updated at the time of filing of the Red Herring Prospectus with the RoC. For more information on IPO Grading, refer to the Chapter titled “General Information” beginning on page 49 of this Draft Red Herring Prospectus. LISTING The Equity Shares offered through this Draft Red Herring Prospectus are proposed to be listed on the BSE and the NSE. Our Company has received in-principle approvals from the BSE and the NSE, for the listing of our Equity Shares pursuant to their letters dated [●] and [●], respectively. For the purpose of this Issue, the Designated Stock Exchange is BSE Ltd. BOOK RUNNING LEAD MANAGER REGISTRAR TO THE ISSUE ARYAMAN FINANCIAL SERVICES LIMITED BIGSHARE SERVICES PRIVATE LIMITED 60, Khatau Building, Gr. Floor, Alkesh Dinesh Modi Marg, E-2/3, Ansa Industrial Estate, Sakivihar Road, Fort, Mumbai - 400 001, Maharashtra, India Sakinaka, Andheri (E), Mumbai - 400 072, Maharashtra, India Tel: +91 22 22618264; Fax: +91 22 22630434 Tel: +91 22 4043 0200; Fax: +91 22 2847 5207 Email: [email protected]; Investor Grievance Email: [email protected] Email: [email protected]; Investor Grievance Email: [email protected] Website: www.afsl.co.in Website: www.bigshareonline.com SEBI Registration No.: MB / INM000011344 SEBI Registration No.: MB / INR000001385 Contact Person: Ms. Nehar Sakaria / Ms. Ambreen Khan Contact Person: Mr. Ashok Shetty BID/ISSUE PROGRAMME BID/ISSUE OPENS ON: [●]* BID/ISSUE CLOSES ON: [●]** * Our Company may consider participation by Anchor Investors. The Anchor Investor Bid/Issue Period shall be one working day prior to the Bid/Issue Opening Date. **Our Company may consider closing the Bid/Issue Period for QIBs one working day prior to the Bid/Issue Closing Date. CMYK TABLE OF CONTENTS PARTICULARS PAGE SECTION I – GENERAL 1 DEFINITIONS AND ABBREVIATIONS 1 CERTAIN CONVENTIONS; PRESENTATION OF FINANCIAL, INDUSTRY AND 9 MARKET DATA FORWARD-LOOKING STATEMENTS 11 SECTION II – RISK FACTORS 12 SECTION III – INTRODUCTION 31 SUMMARY OF OUR INDUSTRY 31 SUMMARY OF OUR BUSINESS 35 SUMMARY OF OUR FINANCIALS 39 THE ISSUE 48 GENERAL INFORMATION 49 CAPITAL STRUCTURE 57 OBJECTS OF THE ISSUE 70 BASIS FOR ISSUE PRICE 76 STATEMENT OF TAX BENEFITS 79 SECTION IV – ABOUT THE ISSUER COMPANY 88 INDUSTRY OVERVIEW 88 OUR BUSINESS 103 REGULATIONS AND POLICIES 138 HISTORY AND CERTAIN CORPORATE MATTERS 146 OUR SUBSIDIARIES 149 OUR MANAGEMENT 151 OUR PROMOTER,