Draft Red Herring Prospectus

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Draft Red Herring Prospectus C M Y K RED HERRING PROSPECTUS Please read Section 60B of the Companies Act, 1956 100% Book Built Issue This Red Herring Prospectus shall be updated upon filing with the RoC Dated March 12, 2010 SHREE GANESH JEWELLERY HOUSE LIMITED Our Company was originally incorporated in Kolkata as Shree Ganesh Jewellery House Private Limited on August 30, 2002. The status of our Company was changed to a public limited company and our name was changed to "Shree Ganesh Jewellery House Limited" pursuant to a fresh certificate of incorporation issued by the RoC, West Bengal on August 14, 2007. For details of incorporation and changes of name, please refer to the section titled "History and Certain Corporate Matters" beginning on page 102 of this Red Herring Prospectus. Registered Office: 413, Vardaan Market, 25A, Camac Street, Kolkata - 700 016; Tel No: + 91 33 2280 0345; Fax No: + 91 33 2283 5075 Website: www.sgjhl.com; E-mail: [email protected] Corporate Office: Avani Signature, 4th Floor, Suite No. 402, 91A/1 Park Street, Kolkata - 700016; Tel: +91 33 3025 9382; Fax: +91 33 4007 1623; Contact Person: Mr. Mukund Chandak, Company Secretary and Compliance Officer Promoters of our Company: Mr. Nilesh Parekh and Mr. Umesh Parekh PUBLIC ISSUE OF 1,42,69,831 EQUITY SHARES OF RS.10 EACH FOR CASH AT A PRICE OF RS. [●] PER EQUITY SHARE (INCLUDING A SHARE PREMIUM OF RS. [●] PER EQUITY SHARE), AGGREGATING TO RS. [●] LACS (HEREINAFTER REFERRED TO AS "THE ISSUE"), CONSISTING OF A FRESH ISSUE OF 1,21,36,497 EQUITY SHARES BY SHREE GANESH JEWELLERY HOUSE LIMITED ("OUR COMPANY" OR "THE ISSUER") AND AN OFFER FOR SALE OF 21,33,334 EQUITY SHARES BY CREDIT SUISSE PE ASIA INVESTMENTS (MAURITIUS) LIMITED ("THE SELLING SHAREHOLDER"). THE ISSUE WILL CONSTITUTE 23.52% OF THE FULLY DILUTED POST ISSUE PAID-UP CAPITAL OF OUR COMPANY. THE FRESH ISSUE WILL CONSTITUTE 20.00% OF THE FULLY DILUTED POST ISSUE PAID-UP CAPITAL OF OUR COMPANY THE FACE VALUE OF THE EQUITY SHARES IS RS. 10 EACH. THE PRICE BAND AND THE MINIMUM BID LOT SIZE WILL BE DECIDED BY OUR COMPANY AND THE SELLING SHAREHOLDER IN CONSULTATION WITH THE BOOK RUNNING LEAD MANAGERS AND ADVERTISED AT LEAST TWO WORKING DAYS PRIOR TO THE BID / ISSUE OPENING DATE. THE ISSUE PRICE IS [●] TIMES THE FACE VALUE OF THE EQUITY SHARES In case of revision in the Price Band, the Bid/Issue Period will be extended for three additional working days after revision of the Price Band subject to the Bid/Issue Period not exceeding Ten working days. Any revision in the Price Band and/or the Bid/Issue Period, if applicable, will be widely disseminated by notification to the Bombay Stock Exchange Limited ("BSE") and the National Stock Exchange of India Limited ("NSE"), by issuing a press release, and also by indicating the change on the websites of the Book Running Lead Managers ("BRLMs") and at the terminals of the members of the Syndicate. In accordance with Rule 19(2)(b) of the Securities Contract (Regulation) Rules, 1957 ("SCRR"), this being an Issue for less than 25% of the post-Issue paid up capital, the Issue is being made through the 100% Book Building Process wherein at least 60% of the Issue will be allocated on a proportionate basis to Qualified Institutional Buyers ("QIBs"), out of which 5% shall be available for allocation on a proportionate basis to Mutual Funds only. Our Company may allocate up to 30% of the QIB Portion to Anchor Investors at the Anchor Investor Price on a discretionary basis, out of which at least one-third will be available for allocation to Mutual Funds only. In the event of under- subscription in the Anchor Investor Portion, the balance Equity Shares shall be added to the Net QIB Portion. 5% of the Net QIB Portion shall be available for allocation to Mutual Funds on a proportionate basis. The remainder of the Net QIB Portion shall be available for allocation on a proportionate basis to all QIBs, including Mutual Funds, subject to valid bids being received from them at or above the Issue Price. If at least 60% of the Issue cannot be allocated to QIBs, then the entire application money will be refunded forthwith. Further, not less than 10% of the Issue will be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 30% of the Issue will be available for allocation on a proportionate basis to Retail Individual Bidders, subject to valid bids being received at or above the Issue Price. IPO GRADING This Issue has been graded by Credit Analysis and Research Limited as "Care IPO Grade 3", indicating "Average Fundamentals". For more information on IPO Grading, please refer to the section titled "General Information" beginning on page 11 of this Red Herring Prospectus. RISKS IN RELATION TO THE FIRST ISSUE This being the first public 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 Rs.10/- and the Floor Price is [●] times of the Face Value and the Cap Price is [●] times of the face value. The Issue Price (as determined and justified by our Company and the Book Running Lead Managers ("BRLMs")) 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 RISK 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 Red Herring Prospectus. Specific attention of the investors is invited to the section titled Risk Factors beginning on Page No. XV of this Red Herring Prospectus. ISSUER'S ABSOLUTE RESPONSIBILITY The Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this 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 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. LISTING The Equity Shares offered through this Red Herring Prospectus are proposed to be listed on the BSE and the NSE. The in-principle approvals of the BSE and the NSE for listing the Equity Shares have been received pursuant to letter no. DSC/IPO/SI/IPO-IP/850/2009-10 dated November 6, 2009 and letter no. NSE/LIST/124444-V dated November 27, 2009 respectively. For the purpose of this Issue, BSE shall be the Designated Stock Exchange. BOOK RUNNING LEAD MANAGERS REGISTRAR TO THE ISSUE Axis Bank Limited ICICI Securities Limited Avendus Capital Private Limited Link Intime India Private Limited Central Office, Maker Tower 'F', 11th Floor, ICICI Centre, H.T. Parekh Marg, IL&FS Financial Center, B Quadrant, 5th Floor, C- 13 Kantilal Maganlal Industrial Estate, Cuffe Parade, Colaba, Churchgate,Mumbai 400 020, India Bandra Kurla Complex,Bandra (East) (Pannalal Silk Mills Compound), Mumbai 400 005, India Tel: +91 22 2288 2460 Mumbai 400 051, India LBS Marg, Bhandup (West), Tel: +91 22 6707 1312 Fax: +91 22 2282 6580 Tel : +91 22 6648 0050 Mumbai - 400 078, India Fax: +91 22 6707 1264 Fax: +91 22 6648 0040 Tel: +91 22 2596 0320 Email: [email protected] Email: [email protected] Email: [email protected] Fax: +91 22 2596 0329 Website: www.axisbank.com Website: www.icicisecurities.com Website: www.avendus.com Contact Person: Mr. Dipen Kapadia/ Mr. Amit Shah Contact person: Mr. Mayank Lunawat Contact person: Ms. Rashi Malik Email: [email protected] Registration No: INM000006104 Registration No: INM000011179 Registration No: INM000011021 Website: www.linkintime.co.in Investor Grievance Investor Grievance Investor Grievance E-mail: Contact Person: Mr. Sachin Achar E-mail: [email protected] E-mail: [email protected] [email protected] Registration No: INR000004068 ISSUE PROGRAMME* BID/ISSUE OPENS ON: FRIDAY, MARCH 19, 2010 BID/ISSUE CLOSES ON: TUESDAY, MARCH 23, 2010 * Bidding for Anchor Investors, if any, shall open one day prior to the Bid/ Issue Opening Date. C M Y K Shree Ganesh Jewellery House Limited Table of Contents SECTION I: GENERAL...............................................................................................................................................i DEFINITIONS AND ABBREVIATIONS.........................................................................................................................................................i PRESENTATION OF FINANCIAL, INDUSTRY AND MARKET DATA................................................................................................. xi NOTICE TO INVESTORS...........................................................................................................................................................................
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