CMYK DRAFT RED HERRING PROSPECTUS Please read Section 60B of the Companies Act, 1956 100% Book Built Issue Dated July 12, 2007 RNS INFRASTRUCTURE LIMITED Our Company was originally incorporated on August 06, 2003 as R. N. Shetty & Company Private Limited. The name of our Company was changed from R. N. Shetty & Company Private Limited to RNS Infrastructures Private Limited vide a fresh certificate of incorporation dated December 21, 2005. Our Company was converted into a public company and the name of the Company was changed from RNS Infrastructures Private Limited to RNS Infrastructures Limited vide a fresh certificate of incorporation dated January 10, 2006. Subsequently the name of our Company was changed from RNS Infrastructures Limited to RNS Infrastructure Limited vide a certificate of incorporation dated February 8, 2006. Registered office: No. 604/B, Murudeshwar Bhavan, Gokul Road, Hubli 580 030, Karnataka, India Tel: +91 836 233 1615 Fax: +91 836 233 0436; Website: www.rnsinfrastructure.com, Corporate office: Naveen Complex, 7th Floor, No. 14, M.G. Road, Bangalore 560 001, Karnataka, India, Tel: +91 80 2558 4181; Fax: +91 80 2558 4017 Contact person and Compliance Officer: Vijayamahantesh V. Khannur Tel: +91 80 2558 4181; Fax: +91 80 2558 4017; Email: [email protected] PUBLIC ISSUE OF 21,660,000 EQUITY SHARES OF Rs. 10 EACH OF RNS INFRASTRUCTURE LIMITED (“COMPANY”/”ISSUER”) FOR CASH AT A PRICE OF RS. PER EQUITY SHARE (INCLUDING A SHARE PREMIUM OF RS. PER EQUITY SHARE) AGGREGATING RS. MILLION (THE “ISSUE”). THE ISSUE COMPRISES A NET ISSUE TO THE PUBLIC OF 21,500,000 SHARES OF RS. 10 EACH (THE “NET ISSUE”) AND A RESERVATION OF 160,000 EQUITY SHARES OF RS. 10 EACH FOR ELIGIBLE EMPLOYEES OF THE COMPANY (THE “EMPLOYEE RESERVATION PORTION”). THE ISSUE WOULD CONSTITUTE 25.58% OF THE FULLY DILUTED POST ISSUE PAID-UP CAPITAL OF THE COMPANY. THE NET ISSUE WILL CONSTITUTE 25.40% OF THE FULLY DILUTED POST ISSUE PAID-UP CAPITAL OF THE COMPANY. PRICE BAND: Rs. TO Rs. PER EQUITY SHARE OF FACE VALUE Rs. 10.THE FACE VALUE OF EQUITY SHARES IS RS. 10 THE FLOOR PRICE IS TIMES THE FACE VALUE AND THE CAP PRICE IS TIMES THE FACE VALUE In case of revision in the Price Band, the Bidding/Issue Period will be extended for three additional days after revision of the Price Band subject to the Bidding/Issue Period not exceeding 10 working days. Any revision in the Price Band and the revised Bidding/Issue Period, if applicable, will be widely disseminated by notification to the National Stock Exchange of India Limited (“NSE”) and the Bombay Stock Exchange Limited (“BSE”), by issuing a press release, and also by indicating the change on the website of the Book Running Lead Manager (“BRLM”) and at the terminals of the Syndicate The Issue is being made through the 100% Book Building Process wherein not more than 50% of the Net Issue shall be allocated on a proportionate basis to Qualified Institutional Buyers (“QIBs”). 5% of the QIB Portion shall be available for allocation to Mutual Funds only and the remaining QIB Portion shall be available for allocation to all the QIB Bidders, including Mutual Funds, subject to valid Bids being received at or above the Issue Price. Further, not less than 15% of the Net Issue shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not less than 35% of the Net Issue shall be available for allocation on a proportionate basis to Retail Individual Bidders, subject to valid Bids being received at or above the Issue Price. Further, 160,000 Equity Shares shall be available for allocation on a proportionate basis to Eligible Employees, subject to valid Bids being received at or above the Issue Price RISK IN RELATION TO FIRST ISSUE This being the first public issue of the Equity Shares, there has been no formal market for the Equity Shares. The face value of the Equity Shares is Rs. 10 and the Floor Price is times the face value and the Cap Price is times the face value. The Issue Price (as determined by the Company in consultation with the BRLM, 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 or regarding the price at which the Equity Shares will be traded after listing. GENERAL RISKS Investments 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 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” commencing on page x. ISSUER’S ABSOLUTE RESPONSIBILITY The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms that this Draft Red Herring 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 Draft Red Herring Prospectus is true and correct in all material aspects 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 Draft Red Herring Prospectus 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 rated by as (pronounced ), indicating . For more information on IPO Grading, please refer to Section “General Information” beginning on page ii. LISTING The Equity Shares offered through this Draft Red Herring Prospectus are proposed to be listed on the NSE and the BSE. We have received in-principle approval from the NSE and the BSE for the listing of our Equity Shares pursuant to letters dated , 2007 and , 2007, respectively. shall be the Designated Stock Exchange for purpose of this issue. BOOK RUNNING LEAD MANAGER REGISTRAR TO THE ISSUE ICICI SECURITIES LIMITED KARVY COMPUTERSHARE PRIVATE LIMITED ICICI Centre, H.T. Parekh Marg, Karvy House, 46, Avenue 4, Street No.1, Churchgate Mumbai 400 020 Banjara Hills, Hyderabad 500 034 Tel: + 91 22 2288 2460 Tel: +91 40 2342 0818 Fax: + 91 22 2282 6580 Fax: +91 40 2342 0814 Email: [email protected] Email: [email protected] Website: www.icicisecurities.com Website: http://kcpl.karvy.com Contact person: Tathagat Mukhopadhyay Contact person: Murali Krishna ISSUE PROGRAMME BID / ISSUE OPENS ON , 2007 BID / ISSUE CLOSES ON , 2007 CMYK TABLE OF CONTENTS SECTION I - GENERAL ................................................................................................................................................................ ii CERTAIN CONVENTIONS; PRESENTATION OF FINANCIAL AND MARKET DATA .......................................... viii FORWARD-LOOKING STATEMENTS ................................................................................................................................. ix SECTION II - RISK FACTORS ................................................................................................................................................... x SECTION III – INTRODUCTION ............................................................................................................................................... 1 SUMMARY OF OUR BUSINESS, STRENGTHS AND STRATEGIES ........................................................................... 1 THE ISSUE ................................................................................................................................................................................ 4 SUMMARY FINANCIAL INFORMATION ......................................................................................................................... 5 GENERAL INFORMATION ................................................................................................................................................... 7 CAPITAL STRUCTURE .......................................................................................................................................................... 14 OBJECTS OF THE ISSUE ...................................................................................................................................................... 22 BASIS FOR ISSUE PRICE ...................................................................................................................................................... 26 STATEMENT OF TAX BENEFITS ....................................................................................................................................... 29 SECTION IV – ABOUT US .......................................................................................................................................................... 38 INDUSTRY OVERVIEW .........................................................................................................................................................