Datamatics Technologies Limited
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PROSPECTUS Please read Section 60B of the Companies Act, 1956 (Dated April 23, 2004) 100% Book Building Issue DATAMATICS TECHNOLOGIES LIMITED (On November 3, 1987, the Company was incorporated as Interface Software Resources Private Limited, a private limited company under the Companies Act, 1956. The Company was subsequently renamed Datamatics Technologies Private Limited on December 18, 1992. On January 14, 1999, the Company became a deemed public company and on December 27, 1999, the Company became a public company. The Company was renamed Datamatics Technologies Limited with effect from January 13, 2000.) Registered Office: Unit No. 117-120 SDF-IV, Santacruz Electronics Export Processing Zone (SEEPZ), Andheri (E), Mumbai 400 096. Tel. No.: (+91-22) 5697 5300, Fax. No.: (+91-22) 2829 2475 Corporate Office: Knowledge Centre, Street No. 17, MIDC, Andheri (E), Mumbai 400 093 Tel. No.: (+91-22) 5697 1177, Fax. No.: (+91-22) 2834 3669, Email: [email protected], Website: www.datamaticstech.com Public Issue of 10,300,000 Equity Shares comprising Fresh Issue of 8,500,000 Equity Shares of Rs. 5/- each at a price of Rs. 110/- for cash aggregating to Rs. 935 million and Offer for Sale of 1,800,000 Equity Shares of Rs. 5/- each at a price of Rs. 110/- for cash aggregating to Rs. 198 million (collectively referred to as the “Issue”). THE ISSUE WOULD CONSTITUTE 25.39% OF THE FULLY DILUTED POST ISSUE PAID-UP EQUITY SHARE CAPITAL OF THE COMPANY The Issue is being made through the 100% Book Building Process wherein up to 50% of the Issue shall be allocated on a discretionary basis to Qualified Institutional Buyers. Further, not less than 25% of the Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 25% 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. RISKS IN RELATION TO FIRST ISSUE This being the first Issue of the Equity Shares of Datamatics Technologies Limited, there has been no formal market for the shares of the Company. The Issue price (as will be determined by the Selling Shareholders and the Company in consultation with the Book Running Lead Manager on the basis of assessment of market demand for the Equity Shares by way of book-building) 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 the Company or regarding the price at which the Equity Shares will be traded after listing. GENERAL RISKS Investment in equity and equity related securities involve 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 the Issuer and the Issue including the risk 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 document. Specific attention of investors is invited to the statement of Risk Factors on page No. i of this Prospectus. ISSUER’S ABSOLUTE RESPONSIBILITY The Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Prospectus contains all information with regard to the Issuer and the Issue, which is material in the context of the Issue, that the information contained in this 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 are proposed to be listed on The Stock Exchange, Mumbai and the National Stock Exchange of India Limited. The Company has received in-principle approval from these Stock Exchanges for the listing of the Equity Shares pursuant to letters dated February 21, 2004 and March 4, 2004 respectively. BOOK RUNNING LEAD MANAGER REGISTRARS TO THE ISSUE ENAM FINANCIAL CONSULTANTS PRIVATE LIMITED INTIME SPECTRUM REGISTRY LIMITED 801/802, Dalamal Tower, C-13, Pannalal Silk Mills Compound Nariman Point, Mumbai - 400 021 India L.B.S. Marg, Bhandup (West), Mumbai - 400 078. Tel: (+91-22) 5638 1800, Fax: (+91-22) 2284 6824 Tel.: (022) 5555 5454, Fax : (+91-22) 5555 5353 Email: [email protected] Email: [email protected] ISSUE PROGRAM BID/ISSUE OPENS ON April 12, 2004 BID/ISSUE CLOSES ON April 19, 2004 TABLE OF CONTENTS Page No. DEFINITIONS AND ABBREVIATIONS .................................................................................................................................................................. A SECTION I: RISK FACTORS ................................................................................................................................................................................... G CERTAIN CONVENTIONS .......................................................................................................................................................................................... G FORWARD-LOOKING STATEMENTS; MARKET DATA....................................................................................................................................... H CURRENCY OF PRESENTATION ............................................................................................................................................................................. I RISK FACTORS……………………………………………………………………………………… ...................................................................................... i SECTION II: INTRODUCTION ............................................................................................................................................................................... 1 THE ISSUE .................................................................................................................................................................................................................... 1 SUMMARY .................................................................................................................................................................................................................... 2 GENERAL INFORMATION ........................................................................................................................................................................................ 4 CAPITAL STRUCTURE OF THE COMPANY ......................................................................................................................................................... 16 OBJECTS OF THE ISSUE ............................................................................................................................................................................................ 27 SECTION III: OFFERING INFORMATION ........................................................................................................................................................... 32 TERMS OF THE ISSUE ............................................................................................................................................................................................... 32 ISSUE STRUCTURE ..................................................................................................................................................................................................... 34 ISSUE PROCEDURE ..................................................................................................................................................................................................... 35 BASIS FOR ISSUE PRICE ............................................................................................................................................................................................ 52 SECTION IV: ABOUT THE COMPANY ................................................................................................................................................................. 55 INDUSTRY .................................................................................................................................................................................................................... 55 PRESENT BUSINESS OF THE COMPANY ............................................................................................................................................................... 63 BRIEF HISTORY OF THE COMPANY ...................................................................................................................................................................... 87 MANAGEMENT AND ORGANISATION .................................................................................................................................................................. 89 PROMOTERS AND THEIR BACKGROUND ............................................................................................................................................................ 101 SUBSIDIARIES .............................................................................................................................................................................................................