Letter of Offer
June 9, 2023
For Eligible Equity Shareholders only
UDAIPUR CEMENT WORKS LIMITED
Our Company was originally incorporated under the provisions of the Companies Act, 1956 as "J.K. Udaipur Udyog Limited", a public limited company, pursuant to a certificate of incorporation dated March 15, 1993 issued by the Registrar of Companies, Rajasthan at Jaipur ("RoC"). Subsequently, the name of our Company was changed to "Udaipur Cement Works Limited", pursuant to which a fresh certificate of incorporation, dated May 19, 2006 was issued by the RoC. For details of the changes to the address of the registered office of our Company, please see "General Information - Changes in the registered office of our Company" on page 47.
Registered Office: Shripati Nagar, CFA, P.O. Dabok, Udaipur 313 022, Rajasthan, India; Tel.: +91 294 265 5076
Corporate Office: Nehru House 4, Bahadur Shah Zafar Marg, New Delhi 110 002, Delhi, India; Tel.: +91 11 6820 1861, +91 11 6820 1864 Contact Person: Poonam Singh, Company Secretary and Compliance Officer
E-mail: ucwl.investors@jkmail.com; Website: www.udaipurcement.com Corporate Identification Number: L26943RJ1993PLC007267
OUR PROMOTER: JK LAKSHMI CEMENT LIMITED
FOR PRIVATE CIRCULATION TO THE ELIGIBLE EQUITY SHAREHOLDERS OF OUR COMPANY ONLY
ISSUE OF UP TO 24,91,27,853 FULLY PAID-UP EQUITY SHARES OF FACE VALUE OF ₹ 4 EACH OF OUR COMPANY (THE "RIGHTS EQUITY SHARES") FOR CASH AT A PRICE OF ₹ 18 PER RIGHTS EQUITY SHARE (INCLUDING A PREMIUM OF ₹ 14 PER EQUITY SHARE) AGGREGATING UP TO ₹ 448.43 CRORES* ON A RIGHTS BASIS TO THE ELIGIBLE EQUITY SHAREHOLDERS OF OUR COMPANY IN THE RATIO OF 4 RIGHTS EQUITY SHARES FOR EVERY 5 FULLY PAID-UP EQUITY SHARES HELD BY THE ELIGIBLE EQUITY SHAREHOLDERS ON THE RECORD DATE, THAT IS JUNE 14, 2023 ("RECORD DATE") (THE "ISSUE"). FOR FURTHER DETAILS, PLEASE SEE "TERMS OF THE ISSUE" ON PAGE 213.
*Assuming full subscription
WILFUL DEFAULTERS OR FRAUDULENT BORROWERS
Neither our Company, nor our Promoter or our Directors are categorized as Wilful Defaulters (as defined hereinafter) or Fraudulent Borrowers (as defined hereinafter).
GENERAL RISKS
Investment in equity and equity related securities involve a degree of risk and investors should not invest any funds in the 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 the Issue. For taking an investment decision, investors must rely on their own examination of our Company and the Issue including the risks involved. The securities being 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 Letter of Offer. Specific attention of investors is invited to the statement of "Risk Factors" on page 15 before making an investment in this Issue.
ISSUER'S ABSOLUTE RESPONSIBILITY
Our Company, having made all reasonable inquiries, accepts responsibility for and confirms that this Letter of Offer contains all information with regard to our Company and the Issue, which is material in the context of the Issue, that the information contained in this Letter of Offer 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 Letter of Offer as a whole or any such information or the expression of any such opinions or intentions misleading in any material respect.
LISTING
The existing Equity Shares of our Company are listed on BSE Limited ("BSE") ("Designated Stock Exchange" or "Stock Exchange", as the context may require). Our Company has received an "in-principle" approval dated June 5, 2023 from BSE for listing of the Rights Equity Shares to be allotted pursuant to the Issue. Our Company will also make applications to BSE to obtain trading approvals for the Rights Entitlements as required under the SEBI circular bearing reference number SEBI/HO/CFD/DIL2/CIR/P/2020/13 dated January 22, 2020. For the purposes of the Issue, the Designated Stock Exchange is BSE.
LEAD MANAGER | REGISTRAR TO THE ISSUE |
JM Financial Limited | KFin Technologies Limited |
7th Floor, Cnergy | Selenium Tower-B, Plot 31 & 32 |
Appasaheb Marathe Marg | Gachibowli, Financial District |
Prabhadevi, Mumbai 400 025 | Nanakramguda, Serilingampally |
Maharashtra, India | Hyderabad 500 032 |
Tel.: +91 22 6630 3030 | Telangana, India |
E-mail: udaipurcementworks.rights@jmfl.com | Tel.: +91 40 6716 2222 |
Investor grievance E-mail:grievance.ibd@jmfl.com | E-mail: udaipur.rights@kfintech.com |
Contact person: Prachi Dhuri | Investor grievance E-mail:einward.ris@kfintech.com |
Website: www.jmfl.com | Contact Person: M Murali Krishna |
SEBI Registration: INM000010361 | Website: www.kfintech.com |
SEBI Registration No.: INR000000221 |
ISSUE PROGRAMME
ISSUE OPENS ON | LAST DATE FOR ON MARKET | ISSUE CLOSES ON** |
RENUNCIATION* | ||
Wednesday, June 21, 2023 | Friday, June 30, 2023 | Wednesday, July 5, 2023 |
*Eligible Equity Shareholders are requested to ensure that renunciation through off-market transfer is completed in such a manner that the Rights Entitlements are credited to the demat accounts of the Renouncees on or prior to the Issue Closing Date.
**Our Board or the Rights Issue Committee will have the right to extend the Issue Period as it may determine from time to time but not exceeding 30 days from the Issue Opening Date (inclusive of the Issue Opening Date). Further, no withdrawal of Application shall be permitted by any Investor after the Issue Closing Date.
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TABLE OF CONTENTS | |
NOTICE TO INVESTORS | 8 |
PRESENTATION OF FINANCIAL INFORMATION AND OTHER INFORMATION | 10 |
FORWARD LOOKING STATEMENTS | 12 |
SUMMARY OF LETTER OF OFFER | 13 |
SECTION II - RISK FACTORS | 15 |
SECTION III: INTRODUCTION | 46 |
THE ISSUE | 46 |
GENERAL INFORMATION | 47 |
CAPITAL STRUCTURE | 52 |
OBJECTS OF THE ISSUE | 54 |
STATEMENT OF SPECIAL TAX BENEFITS | 64 |
OUR MANAGEMENT | 68 |
SECTION IV: ABOUT OUR COMPANY | 71 |
INDUSTRY OVERVIEW | 71 |
OUR BUSINESS | 97 |
SECTION V: FINANCIAL INFORMATION | 109 |
FINANCIAL STATEMENTS | 109 |
ACCOUNTING RATIOS | 175 |
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF | |
OPERATIONS | 176 |
OUTSTANDING LITIGATION AND DEFAULTS | 199 |
GOVERNMENT AND OTHER APPROVALS | 202 |
MATERIAL DEVELOPMENTS | 204 |
OTHER REGULATORY AND STATUTORY DISCLOSURES | 205 |
SECTION VII: ISSUE INFORMATION | 213 |
TERMS OF THE ISSUE | 213 |
SECTION VIII: STATUTORY AND OTHER INFORMATION | 239 |
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION | 239 |
DECLARATION | 241 |
SECTION I - GENERAL
DEFINITIONS AND ABBREVIATIONS
This Letter of Offer uses certain definitions and abbreviations which, unless the context otherwise indicates or implies or unless otherwise specified, shall have the meaning as provided below.
References to any legislation, act, circular, regulation, rules, guidelines or policies shall be to such legislation, act, circular, regulation, rules, guidelines or policies as amended, supplemented, or re-enacted from time to time and any reference to a statutory provision shall include any subordinate legislation made from time to time under that provision.
The words and expressions used in this Letter of Offer, but not defined herein shall have the meaning ascribed to such terms under the SEBI ICDR Regulations, the SEBI LODR Regulations, the Companies Act, the SCRA, the Depositories Act, and the rules and regulations made thereunder.
The following list of capitalised terms used in this Letter of Offer is intended for the convenience of the reader/prospective investor only and is not exhaustive.
Company Related Terms
Term | Description | ||
Annual | Financial | The audited financial statements of our Company as at and for the financial years ended March | |
Statements | 31, 2023 (along with comparative financial statements for the financial year ended March 31, | ||
2022) prepared in accordance with applicable accounting standards, which comprises the | |||
balance sheet as at March 31, 2023 (along with comparative balance sheet as at March 31, | |||
2022) and the statement of profit and loss, including other comprehensive income, the | |||
statement of cash flows and the statement of changes in equity for the years then ended, and | |||
notes to the financial statements, including a summary of significant accounting policies and | |||
other explanatory information. For details, please see "Financial Statements" on page 109 | |||
Articles | of | Articles of association of our Company, as amended from time to time | |
Association/Articles/AoA | |||
Board of | Directors | or | Board of directors of our Company |
Board | |||
Captive Limestone Mines | Together, Limestone Mine-1 and Limestone Mine-2 as defined below | ||
Company | Secretary | and | The company secretary and compliance officer of our Company, namely Poonam Singh |
Compliance Officer | |||
Corporate Office | The corporate office of our Company situated at Nehru House 4, Bahadur Shah Zafar Marg, | ||
New Delhi 110 002, Delhi, India | |||
CRISIL | CRISIL Limited | ||
CRISIL Report | Report on 'Overview of Indian Cement Industry' dated May 2023, prepared by CRISIL | ||
Research, a division of CRISIL Limited, commissioned and paid for by our Company | |||
CRPS | Cumulative redeemable preference shares of face value ₹ 1,00,000 each issued by our | ||
Company | |||
Director(s) | The directors on the Board of our Company | ||
Equity Shareholder(s) | A holder of Equity Share(s) of our Company, from time to time | ||
Equity Shares | Equity shares of face value of ₹ 4 each of our Company | ||
Executive Director(s) | Executive director(s) of our Company. For details, see "Our Management" on page 68 | ||
Expansion Project | Ongoing project for the expansion and development of our Udaipur Manufacturing Plant. For | ||
details, see "Objects of the Issue" on page 54 | |||
Group Companies | Group companies in relation to our Company as defined under Regulation 2(1)(t) of the SEBI | ||
ICDR Regulations | |||
Independent Director(s) | Independent Directors on the Board, who are eligible to be appointed as independent directors | ||
under the provisions of the Companies Act, 2013 and the SEBI LODR Regulations | |||
Key Managerial Personnel | The Key Managerial Personnel of our Company determined in accordance with Regulation | ||
2(1)(bb) of the SEBI ICDR Regulations. For details, see "Our Management" on page 68 | |||
Limestone Mine-1 | Our captive mining facility of 703.305 hectares located at Udaipur, Rajasthan, India under | ||
mining lease bearing ML No. 186/2008 granted by the State Government of Rajasthan | |||
Limestone Mine-2 | Our captive mining facility of 213.33 hectares located at Udaipur, Rajasthan, India under | ||
mining lease bearing ML No. 23/2001 granted by the State Government of Rajasthan | |||
Materiality Threshold | Materiality threshold adopted by our Company solely for the purposes of the Issue in relation | ||
to the disclosure of outstanding civil and tax proceedings, involving our Company, where the |
amount involved is ₹ 35.86 lakhs (being 1% of the profit after tax of our Company, in terms of the Annual Financial Statements as at and for the financial year ended March 31, 2023)
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Term | Description | |
Memorandum | Memorandum of Association of our Company, as amended from time to time | |
of Association/Memorand | ||
um/MoA | ||
Non-Executive Director(s) | Non-executive director(s) of our Company. For details, see "Our Management" on page 68 | |
OCCRPS | Optionally convertible cumulative redeemable preference shares of face value ₹ 100 each | |
issued by our Company | ||
Promoter | The promoter of our Company being JK Lakshmi Cement Limited | |
Promoter Group | The entities constituting the promoter group of our Company determined in accordance with | |
Regulation 2(1)(pp) of the SEBI ICDR Regulations | ||
Promoter | Group | Bengal & Assam Company Limited, a member of our Promoter Group which held 756 Equity |
Shareholder | Shares of our Company as on March 31, 2023 | |
Registered Office | The registered office of our Company situated at Shripati Nagar, CFA, P.O. Dabok, Udaipur | |
313 022, Rajasthan, India | ||
Registrar of Companies or | Registrar of Companies, Rajasthan at Jaipur | |
RoC | ||
Senior Management | Senior management of our Company determined in accordance with Regulation 2(1)(bbbb) | |
of the SEBI ICDR Regulations. For details, see "Our Management" on page 68 | ||
Stakeholders' | Stakeholders' relationship committee of our Board constituted in accordance with Regulation | |
Relationship Committee | 20 of the SEBI LODR Regulations and currently comprising Vinit Marwaha, Independent | |
Director, as chairperson of the committee, Onkar Nath Rai, Independent Director and | ||
Surendra Malhotra, Independent Director | ||
Statutory Auditors | Statutory auditors of our Company namely, M/s. Bansilal Shah & Co., Chartered Accountants | |
Udaipur | Manufacturing | Integrated cement manufacturing unit of the Company at Udaipur, Rajasthan, India |
Plant | ||
Whole-Time Director | The whole-time director of our Board namely, Naveen Kumar Sharma |
Issue Related Terms
Term | Description | ||
Abridged | Letter | of | The abridged letter of offer to be sent to the Eligible Equity Shareholders with respect to the |
Offer/ALOF | Issue in accordance with the provisions of the SEBI ICDR Regulations and the Companies | ||
Act, 2013 | |||
Additional | Rights | Equity | The Rights Equity Shares applied for or allotted under this Issue in addition to the Rights |
Shares | Entitlement | ||
Allotment/Allot/Allotted | Allotment of Rights Equity Shares pursuant to the Issue | ||
Allotment Accounts | The accounts opened with the Banker(s) to this Issue, into which the Application Money | ||
blocked by Application Supported by Blocked Amount in the ASBA Account, with respect to | |||
successful Investors will be transferred on the Transfer Date in accordance with Section 40(3) | |||
of the Companies Act, 2013 | |||
Allotment | Account | Bank(s) which are clearing members and registered with SEBI as bankers to an issue and with | |
Bank(s) | whom the Allotment Accounts will be opened, in this case being, Axis Bank Limited | ||
Allotment Advice | Note, advice or intimation of Allotment sent to each successful Investor who has been or is to | ||
be Allotted the Rights Equity Shares pursuant to the Issue | |||
Allotment Date | Date on which the Allotment is made pursuant to the Issue | ||
Allottee(s) | Person(s) to whom the Rights Equity Shares are Allotted pursuant to Issue | ||
Application | Application made through submission of the Application Form or plain paper application to | ||
the Designated Branch(es) of the SCSBs or online/electronic application through the website | |||
of the SCSBs (if made available by such SCSBs) under the ASBA process to subscribe to the | |||
Rights Equity Shares at the Issue Price | |||
Application Form | Unless the context otherwise requires, an application form used or application through the | ||
website of the SCSBs (if made available by such SCSBs) under the ASBA process used by an | |||
Investor to make an application for the Allotment of Rights Equity Shares in this Issue | |||
Application Money | Aggregate amount payable at the time of Application i.e., ₹ 18 per Rights Equity Share in | ||
respect of the Rights Equity Shares applied for in the Issue at the Issue Price | |||
Application Supported by | Application (whether physical or electronic) used by an Investor to make an application | ||
Blocked Amount/ASBA | authorizing the SCSB to block the Application Money in a specified bank account maintained | ||
with the SCSB | |||
ASBA Account | An account maintained with SCSBs and as specified in the Application Form or plain paper | ||
Application, as the case may be, by the Investor for blocking the amount mentioned in the | |||
Application Form or in the plain paper Application | |||
Banker to the Issue | Agreement dated June 9, 2023 entered into by and among our Company, the Registrar to the | ||
Agreement | Issue, the Lead Manager and the Banker to the Issue for collection of the Application Money | ||
from Investors, transfer of funds to the Allotment Account from the SCSBs, Allotment | |||
Account to our Company and other persons and where applicable, refunds of the amounts |
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Udaipur Cement Works Ltd. published this content on 12 June 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 June 2023 07:02:15 UTC.