-
“Investment in capital market involves certain degree of risks.
The investors are required to read the prospectus and risk factors
carefully, assess their own financial conditions and risk taking
ability before making their investment decisions.”
ISSUE DATE OF THE PROSPECTUS: NOVEMBER 9, 2020
Initial Public Offer (IPO) for 40,293,566 ordinary shares, from
which 20,146,766 ordinary shares are reserved for Eligible
Investors (EIs) at their own bid price and quantity on highest to
lowest bid basis in a descending order of individual bid price till
exhaustion of the quota for EI category at on or above the cut-off
price Tk. 35.00 and remaining 20,146,800 ordinary shares at a 10%
discounted price from the cut-off price i.e Tk. 31.00 per share for
General Public including NRBs totaling Tk. 1,500,000,000.00.
Opening date for subscription: December 07, 2020
Closing date for subscription (cut-off date): December 13,
2020
PROSPECTUS OF
MANAGER TO THE ISSUE
CREDIT RATING STATUS
Rating Particulars Long Term Short Term
Entity Rating AA2 ST-3
Outlook Stable
Rated by Credit Rating Agency of Bangladesh Limited (CRAB)
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Page | 2
“If you have any query about this document, you may consult the
issuer, issue manager and underwriter”
A person interested to get a prospectus may obtain from the
issuer and the issue manager
ISSUER COMPANY CONTACT PERSON CONTACT NUMBER Energypac Power
Generation Limited Energy Center, Plot 25, Tejgaon Industrial Area,
Tejgaon, Dhaka 1208
Mr. Md. Alauddin Shibly
Company Secretary
Tel: +88 02 887 06 69 Fax: +88 02 887 06 97 e-mail:
[email protected] Website: www.energypac.com
ISSUE MANAGER CONTACT PERSON CONTACT NUMBER
LankaBangla Investments Limited Assurance Nazir Tower, Level –
06, 65/B, Kemal Ataturk Avenue, Banani, Dhaka – 1213
Mr. Iftekhar Alam
Chief Executive Officer
Tel: +88 02 55 03 48 53-5 Fax: +88 02 55 03 48 56 e-mail:
[email protected] Website:
www.lankabangla-investments.com
REGISTRAR TO THE ISSUE CONTACT PERSON CONTACT NUMBER
ICB Capital Management Limited Green City Edge (5th & 6th
Floor), 89, Kakrail, Dhaka-1000.
Shukla Das
Chief Executive Officer
Tel: +88 02 830 05 55 Fax: +88 02 830 03 96 e-mail:
[email protected] Website: www.icml.com.bd
UNDERWRITERS CONTACT PERSON CONTACT NUMBER
LankaBangla Investments Limited Assurance Nazir Tower, Level –
06, 65/B, Kemal Ataturk Avenue, Banani, Dhaka – 1213
Mr. Iftekhar Alam Chief Executive Officer
Tel: +88 02 55 03 48 53-5 Fax: +88 02 55 03 48 56 e-mail:
[email protected] Website:
www.lankabangla-investments.com
ICB Capital Management Limited Green City Edge (5th & 6th
Floor), 89, Kakrail, Dhaka-1000.
Shukla Das Chief Executive Officer
Tel: + 88 02 830 05 55 Fax: + 88 02 830 03 96 e-mail:
[email protected] Website: www.icml.com.bd
AFC Capital Limited Saiham Sky View Tower (11th Floor), 45,
Bijoy Nagar, Dhaka-1000.
Mr. Golam Md. Ahsan Kabir Head Primary Market Services
Tel: + 88 02 839 23 71 Fax: + 88 02 839 23 72 e-mail:
[email protected] Website: www.afccl.com
NBL Capital and Equity Management Limited Printers Building (8th
Floor), 5 Rajuk Avenue, Dhaka-1000.
Ms. Kamrun Naher
Chief Executive Officer
Tel: + 88 02 471 18 805 Fax: + 88 02 471 18 807 e-mail:
[email protected] Website: www.nblceml.com
Prime Finance Capital Management Limited PFI Tower (7th Floor),
56-57, Dilkusha C/A, Dhaka-1000.
Mr. Mohammad Rajibul Islam
Head of Public Issue
Tel: + 88 02 958 48 74 Fax: + 88 02 985 49 22 e-mail:
[email protected] Website: www. primefincap.com
EBL Investments Limited Jiban Bima Bhaban (Ground Floor), 10,
Dilkusha C/A, Dhaka-1000
Mr. Mohammad Sayedur Rahman AVP, Primary Market Operations
Tel: + 88 02 471 11 096 Fax: + 88 02 471 11 218 e-mail:
[email protected] Website: www.eblinvestments.com
AUDITORS’ OF THE COMPANY CONTACT PERSON CONTACT NUMBER
Howladar Yunus & Co. Chartered Accountants 67 Dilkusha
Commercial Area (2nd Floor) Dhaka - 1000, Bangladesh
Mr. Zahidur Rahman, FCA Partner
Tel: +88 02 955 41 19, Fax: +88 02 956 29 89 e-mail:
[email protected] Website: www.hyc.com.bd
CREDIT RATING COMPANY CONTACT PERSON CONTACT NUMBER
Credit Rating Agency of Bangladesh Limited D H Tower,6
Panthapath, Level 15, Dhaka 1215
Mr. Mohammed Nazrul Islam
Bhuiyan FAVP
Tel: + 8802-55013678 Fax: 8802-55013679 e-mail: [email protected]
Website: www.crab.com.bd
VALUAR COMPANY CONTACT PERSON CONTACT NUMBER
Malek Siddiqui Wali Chartered Accountants 9-G Motijheel,
Commercial Area, Dhaka-1000
Mr. MD. Waliullah FCA
Partner
Tel: +88 02 9513471 Fax: +88 02 9516236 e-mail:
[email protected] Website: www.msw-bd.com
http://www.lankabangla-investments.com/mailto:[email protected]://www.icml.com.bd/http://www.lankabangla-investments.com/http://www.icml.com.bd/http://www.afccl.com/http://www.lankabangla-investments.com/mailto:[email protected]://www.eblinvestments.com/mailto:[email protected]:[email protected]://www.msw-bd.com/
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“CONSENT OF THE BANGLADESH SECURITIES AND EXCHANGE COMMISSION
HAS BEEN OBTAINED TO THE ISSUE/OFFER OF THESE SECURITIES UNDER THE
SECURITIES AND EXCHANGE ORDINANCE, 1969, AND THE BANGLADESH
SECURITIES AND EXCHANGE COMMISSION (PUBLIC ISSUE) RULES, 2015. IT
MUST BE DISTINCTLY UNDERSTOOD THAT IN GIVING THIS CONSENT THE
COMMISSION DOES NOT TAKE ANY RESPONSIBILITY FOR THE FINANCIAL
SOUNDNESS OF THE ISSUER COMPANY, ANY OF ITS PROJECTS OR THE ISSUE
PRICE OF ITS SECURITIES OR FOR THE CORRECTNESS OF ANY OF THE
STATEMENTS MADE OR OPINION EXPRESSED WITH REGARD TO THEM. SUCH
RESPONSIBILITY LIES WITH THE ISSUER, ITS DIRECTORS, CHIEF EXECUTIVE
OFFICER, MANAGING DIRECTOR, CHIEF FINANCIAL OFFICER, COMPANY
SECRETARY, ISSUE MANAGER, ISSUE MANAGER’S CHIEF EXECUTIVE OFFICER,
UNDERWRITERS, AUDITOR(S), VALUER AND/OR CREDIT RATING COMPANY (IF
ANY)."
"This being the first issue of the issuer, there has been no
formal market for the securities of the issuer. The face value of
the securities is Tk. 10.00 (ten) and the issue price is Tk. 31.00
i.e. ‘3.10 times for General Public” of the face value. The issue
price has been determined and justified by the issuer and the issue
manager/or bidding by the eligible investors as stated under the
paragraph on “Justification of Issue Price” should not be taken to
be indicative of the market price of the securities after listing.
No assurance can be given regarding an active or sustained trading
of the securities or the price after listing."
"Investment in securities involves a degree of risk and
investors should not invest any funds in this offer 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 offer. For taking an investment
decision, investors must rely on their own examination of the
issuer and the offer including the risks involved. The securities
have not been recommended by the Bangladesh Securities and Exchange
Commission (BSEC) nor does BSEC guarantee the accuracy or adequacy
of this document. Specific attention of investors is invited to the
statement of ‘risk factors’ given on page number(s) (227-237).
"The issuer, having made all reasonable inquiries, accepts
responsibility for and confirms that this prospectus contains all
material information with regard to the issuer and the issue, that
the information contained in the prospectus are true, fair and
correct in all material aspects and are not misleading in any
respect, that the opinions and intentions expressed herein are
honestly held and that there are no other facts, the omission of
which make this document as a whole or any of such information or
the expression of any such opinions or intentions misleading in any
material respect."
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Page | 4
AVAILABILITY OF PROSPECTUS
Copy of Prospectus of Energypac Power Generation Limited may be
obtained from the following institutions:
ISSUER COMPANY CONTACT PERSON CONTACT NUMBER Energypac Power
Generation Limited Energy Center, Plot 25, Tejgaon Industrial Area,
Tejgaon, Dhaka 1208
Mr. Md. Alauddin Shibly
Company Secretary
Tel: +88 02 887 06 69 Fax: +88 02 887 06 97 e-mail:
[email protected] Website: www.energypac.com
ISSUE MANAGER CONTACT PERSON CONTACT NUMBER LankaBangla
Investments Limited Assurance Nazir Tower, Level – 06, 65/B, Kemal
Ataturk Avenue, Banani, Dhaka – 1213
Mr. Iftekhar Alam
Chief Executive Officer
Tel: +88 02 55 03 48 53-5 Fax: +88 02 55 03 48 56 e-mail:
[email protected] Website:
www.lankabangla-investments.com
REGISTRAR TO THE ISSUE CONTACT PERSON CONTACT NUMBER
ICB Capital Management Limited Green City Edge (5th & 6th
Floor), 89, Kakrail, Dhaka-1000.
Shukla Das
Chief Executive Officer
Tel: +88 02 830 05 55 Fax: +88 02 830 03 96 e-mail:
[email protected] Website: www.icml.com.bd
UNDERWRITERS CONTACT PERSON CONTACT NUMBER LankaBangla
Investments Limited Assurance Nazir Tower, Level – 06, 65/B, Kemal
Ataturk Avenue, Banani, Dhaka – 1213
Mr. Iftekhar Alam Chief Executive Officer
Tel: +88 02 55 03 48 53-5 Fax: +88 02 55 03 48 56 e-mail:
[email protected] Website:
www.lankabangla-investments.com
ICB Capital Management Limited Green City Edge (5th & 6th
Floor), 89, Kakrail, Dhaka-1000.
Shukla Das Chief Executive Officer
Tel: + 88 02 830 05 55 Fax: + 88 02 830 03 96 e-mail:
[email protected] Website: www.icml.com.bd
AFC Capital Limited Saiham Sky View Tower (11th Floor), 45,
Bijoy Nagar, Dhaka-1000.
Mr. Golam Md. Ahsan Kabir Manager
Tel: + 88 02 839 23 71 Fax: + 88 02 839 23 72 e-mail:
[email protected] Website: www.afccl.com
NBL Capital and Equity Management Limited Printers Building (8th
Floor), 5 Rajuk Avenue, Dhaka-1000
Ms. Kamrun Naher Chief Executive Officer
Tel: + 88 02 471 18 805 Fax: + 88 02 471 18 807 e-mail:
[email protected] Website: www.nblceml.com
Prime Finance Capital Management Limited PFI Tower (7th Floor),
56-57, Dilkusha C/A, Dhaka-1000.
Mr. Mohammad Rajibul Islam Head of Public Issue
Tel: + 88 02 958 48 74 Fax: + 88 02 985 49 22 e-mail:
[email protected] Website: www. primefincap.com
EBL Investments Limited Jiban Bima Bhaban (Ground Floor), 10,
Dilkusha C/A, Dhaka-1000
Mr. Mohammad Sayedur Rahman AVP, Primary Market Operations
Tel: + 88 02 471 11 096 Fax: + 88 02 471 11 218 e-mail:
[email protected] Website: www.eblinvestments.com
STOCK EXCHANGES CONTACT PERSON CONTACT NUMBER Dhaka Stock
Exchange Limited 9/F Motijheel C/A, Dhaka - 1000
Mr. Md. Afzalur Rahman Manager
Tel: +88 02 956 46 01-7, 88 02 966 69 44-8 Fax: +88 02 956 9755,
+88 02 956 47 27 e-mail: [email protected] website:
www.dsebd.org
Chittagong Stock Exchange Limited CSE Building, 1080, Sheikh
Mujib Road, Chittagong - 4100
Mr. Mohammad Jabed Sarwar
Assistant Manager
Tel: +88 031 714 632-3 +88 031 720 871 Fax: +88 031 714 101; +88
02 951 39 11-15 e-mail: [email protected] website:
www.cse.com.bd
Prospectus is also available on the websites of Energypac Power
Generation Limited (www.energypac.com), LankaBangla Investments
Limited (www.lankabangla-investments.com), BSEC (www.sec.gov.bd),
DSE (www.dsebd.org), CSE (www.csebd.com) and Public Reference room
of the Bangladesh Securities and Exchange Commission (BSEC) for
reading and studying.
Prospectus is published in the following Newspapers:
Name of the Newspaper Date of Publication
The Business Standard
November 09, 2020 The Financial Express
The Daily Bonik Barta
The Daily Samakal
http://www.lankabangla-investments.com/http://www.icml.com.bd/http://www.lankabangla-investments.com/http://www.icml.com.bd/http://www.afccl.com/http://www.lankabangla-investments.com/mailto:[email protected]://www.eblinvestments.com/mailto:[email protected]://www.cse.com.bd/
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DEFINITIONS AND ACRONYMS/ELABORATION
Term Elaboration
AGM Annual General Meeting
Allotment Allotment of shares
BAS Bangladesh Accounting Standards
BPDB Bangladesh Power Development Board
BDT Bangladeshi Taka
BSEC Bangladesh Securities and Exchange Commission
Busbar A busbar in electrical power distribution refers to thick
strips of copper or aluminum that conduct electricity within a
switchboard, fuel cell, distribution board, substation, or other
electrical apparatus.
CAGR Compounded Annual Growth Rate
CCPP Combined cycle power plant
Certificate Share Certificate
CDBL Central Depository Bangladesh Limited
CIB Credit Information Bureau
CNG Compressed Natural Gas (CNG) is a fossil fuel substitute for
gasoline (petrol), diesel, or propane/LPG. Although its combustion
does produce greenhouse gases, it is a more environmentally clean
alternative to those fuels.
EPC EPC is an acronym which stands for Engineering, Procurement
and Construction. It is a common form of contracting arrangement
within the construction industry. Under an EPC contract, the
contractor designs the installation, procures the necessary
materials and builds the project, either directly or by
subcontracting part of the work.
EPS Earnings per Share
FY Fiscal Year
GOB Government of Bangladesh
GP Margin Gross profit margin
ICB Investment Corporation of Bangladesh
IPO Initial Public Offering
IPP Independent Power Producer
Issuer Energypac Power Generation Limited
Issue Manager LankaBangla Investments Limited
JAC Anhui Jianghuai Automobile Co., Ltd.
JCB J.C. Bamford Excavators Limited
KW kilowatt
LPG Liquefied petroleum gas
MW Mega Watt
mmcfd Million Cubic Feet per Day NAV Net Asset Value
NG Natural Gas
NBFI Non-Banking Financial Institution
NP Margin Net Profit Margin
NRB Non Resident Bangladeshi
Sponsors The sponsor shareholders of Energypac Power Generation
Limited
SIPP Small Independent Power Producers
Turnkey A turnkey or a turnkey project (also spelled turn-key)
is a type of project that is constructed by a developer and sold or
turned over to a buyer in a ready-to-use condition.
USD United States Dollar
VAT Value Added Tax
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TABLE OF CONTENTS
Page No. EXECUTIVE SUMMARY 19
ABOUT THE INDUSTRY 19
ABOUT THE ISSUER 20
FINANCIAL INFORMATION 20
FEATURES OF THE ISSUE AND ITS OBJECTS 21
LEGAL AND OTHER INFORMATION 21
PROMOTERS’ BACKGROUND 21
CAPITAL STRUCTURE AND HISTORY OF CAPITAL RAISING 22
SUMMARY OF VALUATION REPORT OF SECURITIES 23
OTHERS 23
CONDITIONS IMPOSED BY THE COMMISSION IN THE CONSENT LETTER
24
DECLARATION AND DUE DILIGENCE CERTIFICATES AS PER ANNEXURE- A, B
AND C 31
ABOUT THE ISSUER 40
NAME OF THE ISSUER, DATES OF INCORPORATION AND COMMENCEMENT OF
ITS COMMERCIAL OPERATIONS, ITS LOGO, ADDRESSES OF ITS REGISTERED
OFFICE, OTHER OFFICES AND PLANTS, TELEPHONE NUMBER, FAX NUMBER,
CONTACT PERSON, WEBSITE ADDRESS AND E-MAIL ADDRESS;
40
THE NAMES OF THE SPONSORS AND DIRECTORS OF THE ISSUER; 40
THE NAME, LOGO AND ADDRESS OF THE AUDITORS AND REGISTRAR TO THE
ISSUE, ALONG WITH THEIR TELEPHONE NUMBERS, FAX NUMBERS, CONTACT
PERSONS, WEBSITE AND E-MAIL ADDRESSES;
40
THE NAME(S) OF THE STOCK EXCHANGES WHERE THE SPECIFIED
SECURITIES ARE PROPOSED TO BE LISTED. 41
CORPORATE DIRECTORY OF THE ISSUER 42
DESCRIPTION OF THE ISSUER 43
THE SUMMARY OF THE INDUSTRY AND BUSINESS ENVIRONMENT OF THE
ISSUER. THE SUMMARY SHALL NOT BE ONE-SIDED OR BIASED TO HIGHLIGHT
THE ISSUER OR THE ISSUE;
43
SUMMARY OF CONSOLIDATED FINANCIAL, OPERATING AND OTHER
INFORMATION. 44
GENERAL INFORMATION OF ISSUER 45
NAME AND ADDRESS, TELEPHONE AND FAX NUMBERS OF THE REGISTERED
OFFICE, CORPORATE HEAD OFFICE, OTHER OFFICES, FACTORY, BUSINESS
PREMISES AND OUTLETS OF THE ISSUER;
45
THE BOARD OF DIRECTORS OF THE ISSUER 45
NAMES, ADDRESSES, TELEPHONE NUMBERS, FAX NUMBERS AND E-MAIL
ADDRESSES OF THE CHAIRMAN, MANAGING DIRECTOR, WHOLE TIME DIRECTORS,
ETC. OF THE ISSUER;
45
NAMES, ADDRESSES, TELEPHONE NUMBERS, FAX NUMBERS AND E-MAIL
ADDRESSES OF THE CFO, COMPANY SECRETARY, LEGAL ADVISOR, AUDITORS
AND COMPLIANCE OFFICER;
46
NAMES, ADDRESSES, TELEPHONE NUMBERS, FAX NUMBERS, CONTACT
PERSON, WEBSITE ADDRESSES AND E-MAIL ADDRESSES OF THE ISSUE
MANAGER(S), REGISTRAR TO THE ISSUE ETC
46
DETAILS OF CREDIT RATING 47
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THE NAMES OF ALL THE CREDIT RATING AGENCIES FROM WHICH CREDIT
RATING HAS BEEN OBTAINED 47
THE DETAILS OF ALL THE CREDIT RATINGS OBTAINED FOR THE ISSUE AND
THE ISSUER 47
THE RATIONALE OR DESCRIPTION OF THE RATINGS (S) SO OBTAINED, AS
FURNISHED BY THE CREDIT RATING AGENCY(S) 47
OBSERVATIONS AND RISK FACTORS AS STATED IN THE CREDIT RATING
REPORT 47
DETAILS OF UNDERWRITING 48
THE NAMES, ADDRESSES, TELEPHONE NUMBERS, FAX NUMBERS, CONTACT
PERSONS AND E-MAIL ADDRESSES OF THE UNDERWRITERS AND THE AMOUNT
UNDERWRITTEN BY THEM
48
DECLARATION BY THE UNDERWRITERS THAT THEY HAVE SUFFICIENT
RESOURCES AS PER THE REGULATORY REQUIREMENTS TO DISCHARGE THEIR
RESPECTIVE OBLIGATIONS
48
MAJOR TERMS AND CONDITIONS OF THE UNDERWRITING AGREEMENTS 50
CAPITAL STRUCTURE OF ISSUER 51
AUTHORIZED, ISSUED, SUBSCRIBED AND PAID UP CAPITAL (NUMBER AND
CLASS OF SECURITIES, ALLOTMENT DATES, NOMINAL PRICE, ISSUE PRICE
AND FORM OF CONSIDERATION)
51
SIZE OF THE PRESENT ISSUE, WITH BREAK-UP (NUMBER OF SECURITIES,
DESCRIPTION, NOMINAL VALUE AND ISSUE AMOUNT)
51
PAID UP CAPITAL BEFORE AND AFTER THE PRESENT ISSUE, AFTER
CONVERSION OF CONVERTIBLE INSTRUMENTS (IF ANY) AND SHARE PREMIUM
ACCOUNT (BEFORE AND AFTER THE ISSUE)
52
CATEGORY WISE SHAREHOLDING STRUCTURE WITH PERCENTAGE BEFORE AND
AFTER THE PRESENT ISSUE AND AFTER CONVERSION OF CONVERTIBLE
INSTRUMENTS (IF ANY)
52
WHERE SHARES HAVE BEEN ISSUED FOR CONSIDERATION IN OTHER THAN
CASH AT ANY POINT OF TIME, DETAILS IN A SEPARATE TABLE, INDICATING
THE DATE OF ISSUE, PERSONS TO WHOM THOSE ARE ISSUED, RELATIONSHIP
WITH THE ISSUER, ISSUE PRICE, CONSIDERATION AND VALUATION THEREOF,
REASONS FOR THE ISSUE AND WHETHER ANY BENEFITS HAVE BEEN ACCRUED TO
THE ISSUER OUT OF THE ISSUE
52
WHERE SHARES HAVE BEEN ALLOTTED IN TERMS OF ANY MERGER,
AMALGAMATION OR ACQUISITION SCHEME, DETAILS OF SUCH SCHEME AND
SHARES ALLOTTED
54
WHERE THE ISSUER HAS ISSUED EQUITY SHARES UNDER ONE OR MORE
EMPLOYEE STOCK OPTION SCHEMES, DATE-WISE DETAILS OF EQUITY SHARES
ISSUED UNDER THE SCHEMES, INCLUDING THE PRICE AT WHICH SUCH EQUITY
SHARES WERE ISSUED
54
IF THE ISSUER HAS MADE ANY ISSUE OF SPECIFIED SECURITIES AT A
PRICE LOWER THAN THE ISSUE PRICE DURING THE PRECEDING TWO YEARS,
SPECIFIC DETAILS OF THE NAMES OF THE PERSONS TO WHOM SUCH SPECIFIED
SECURITIES HAVE BEEN ISSUED, RELATION WITH THE ISSUER, REASONS FOR
SUCH ISSUE AND THE PRICE THEREOF
54
THE DECISION OR INTENTION, NEGOTIATION AND CONSIDERATION OF THE
ISSUER TO ALTER THE CAPITAL STRUCTURE BY WAY OF ISSUE OF SPECIFIED
SECURITIES IN ANY MANNER WITHIN A PERIOD OF ONE YEAR FROM THE DATE
OF LISTING OF THE PRESENT ISSUE
54
THE TOTAL SHAREHOLDING OF THE SPONSORS AND DIRECTORS IN A
TABULAR FORM, CLEARLY STATING THE NAMES, NATURE OF ISSUE, DATE OF
ALLOTMENT, NUMBER OF SHARES, FACE VALUE, ISSUE PRICE,
CONSIDERATION, DATE WHEN THE SHARES WERE MADE FULLY PAID UP,
PERCENTAGE OF THE TOTAL PRE AND POST ISSUE CAPITAL, THE LOCK IN
PERIOD AND THE NUMBER AND PERCENTAGE OF PLEDGED SHARES, IF ANY,
HELD BY EACH OF THEM
55
THE DETAILS OF THE AGGREGATE SHAREHOLDING OF THE SPONSORS AND
DIRECTORS, THE AGGREGATE NUMBER OF SPECIFIED SECURITIES PURCHASED
OR SOLD OR OTHERWISE TRANSFERRED BY THE SPONSOR AND/OR BY THE
DIRECTORS OF THE ISSUER AND THEIR RELATED PARTIES WITHIN SIX MONTHS
IMMEDIATE PRECEDING THE DATE OF FILING THE RED-HERRING PROSPECTUS/
PROSPECTUS/ INFORMATION MEMORANDUM
56
THE NAME AND ADDRESS OF ANY PERSON WHO OWNS, BENEFICIALLY OR OF
RECORD, 5% OR MORE OF THE SECURITIES OF THE ISSUER, INDICATING THE
AMOUNT OF SECURITIES OWNED, WHETHER THEY ARE OWNED BENEFICIALLY OR
OF RECORD, AND THE PERCENTAGE OF THE SECURITIES REPRESENTED BY SUCH
OWNERSHIP INCLUDING NUMBER OF EQUITY SHARES WHICH THEY WOULD BE
ENTITLED TO UPON EXERCISE OF WARRANT, OPTION OR RIGHT TO CONVERT
ANY CONVERTIBLE INSTRUMENT
56
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Page | 8
THE NUMBER OF SECURITIES OF THE ISSUER OWNED BY EACH OF THE TOP
TEN SALARIED OFFICERS, AND ALL OTHER OFFICERS OR EMPLOYEES AS
GROUP, INDICATING THE PERCENTAGE OF OUTSTANDING SHARES REPRESENTED
BY THE SECURITIES OWNED
56
DESCRIPTION OF BUSINESS OF ISSUER 58
THE DATE ON WHICH THE ISSUER COMPANY WAS INCORPORATED AND THE
DATE ON WHICH IT COMMENCED OPERATIONS AND THE NATURE OF THE
BUSINESS WHICH THE COMPANY AND ITS SUBSIDIARIES ARE ENGAGED IN OR
PROPOSE TO ENGAGE IN
58
LOCATION OF THE PROJECT 59
PLANT, MACHINERY, TECHNOLOGY, PROCESS, ETC 59
DETAILS OF THE MAJOR EVENTS IN THE HISTORY OF THE ISSUER,
INCLUDING DETAILS OF CAPACITY/FACILITY CREATION, LAUNCHING OF
PLANT, PRODUCTS, MARKETING, CHANGE IN OWNERSHIP AND/OR KEY
MANAGEMENT PERSONNEL ETC
59
PRINCIPAL PRODUCTS OR SERVICES OF THE ISSUER AND MARKETS FOR
SUCH PRODUCTS OR SERVICES. PAST TRENDS AND FUTURE PROSPECTS
REGARDING EXPORTS (IF APPLICABLE) AND LOCAL MARKET, DEMAND AND
SUPPLY FORECASTS FOR THE SECTOR IN WHICH THE PRODUCT IS INCLUDED
WITH SOURCE OF DATA
60
IF THE ISSUER HAS MORE THAN ONE PRODUCT OR SERVICE, THE RELATIVE
CONTRIBUTION TO SALES AND INCOME OF EACH PRODUCT OR SERVICE THAT
ACCOUNTS FOR MORE THAN 10% OF THE COMPANY’S TOTAL REVENUES
62
DESCRIPTION OF ASSOCIATES, SUBSIDIARY AND HOLDING COMPANY OF THE
ISSUER AND CORE AREAS OF BUSINESS THEREOF
62
HOW THE PRODUCTS OR SERVICES ARE DISTRIBUTED WITH DETAILS OF THE
DISTRIBUTION CHANNEL. EXPORT POSSIBILITIES AND EXPORT OBLIGATIONS,
IF ANY
63
COMPETITIVE CONDITIONS IN BUSINESS WITH NAMES, PERCENTAGE AND
VOLUME OF MARKET SHARES OF MAJOR COMPETITORS
64
SOURCES AND AVAILABILITY OF RAW MATERIALS, NAMES AND ADDRESSES
OF THE PRINCIPAL SUPPLIERS AND CONTINGENCY PLAN IN CASE OF ANY
DISRUPTION
64
SOURCES OF, AND REQUIREMENT FOR, POWER, GAS AND WATER; OR ANY
OTHER UTILITIES AND CONTINGENCY PLAN IN CASE OF ANY DISRUPTION
65
NAMES, ADDRESS(S), TELEPHONE NUMBER, WEB ADDRESS, E-MAIL AND FAX
NUMBER OF THE CUSTOMERS WHO ACCOUNT FOR 10% OR MORE OF THE
COMPANY’S PRODUCTS /SERVICES WITH AMOUNT AND PERCENTAGE THEREOF
65
NAMES, ADDRESS(S), TELEPHONE NUMBER, WEB ADDRESS, E-MAIL AND FAX
NUMBER OF THE SUPPLIERS FROM WHOM THE ISSUER PURCHASES 10% OR MORE
OF ITS RAW MATERIAL/ FINISHED GOODS WITH AMOUNT AND PERCENTAGE
THEREOF
65
DESCRIPTION OF ANY CONTRACT WHICH THE ISSUER HAS WITH ITS
PRINCIPAL SUPPLIERS OR CUSTOMERS SHOWING THE TOTAL AMOUNT AND
QUANTITY OF TRANSACTION FOR WHICH THE CONTRACT IS MADE AND THE
DURATION OF THE CONTRACT. IF THERE IS NOT ANY OF SUCH CONTRACT, A
DECLARATION IS TO BE DISCLOSED DULY SIGNED BY CEO/MD, CFO AND
CHAIRMAN ON BEHALF OF BOARD OF DIRECTORS
66
DESCRIPTION OF LICENSES, REGISTRATIONS, NOC AND PERMISSIONS
OBTAINED BY THE ISSUER WITH ISSUE, RENEWAL AND EXPIRY DATES
67
DESCRIPTION OF ANY MATERIAL PATENTS, TRADEMARKS, LICENSES OR
ROYALTY AGREEMENTS 68
NUMBER OF TOTAL EMPLOYEES AND NUMBER OF FULL-TIME EMPLOYEES
68
A BRIEF DESCRIPTION OF BUSINESS STRATEGY 68
A TABLE CONTAINING THE EXISTING INSTALLED CAPACITIES FOR EACH
PRODUCT OR SERVICE, CAPACITY UTILIZATION FOR THESE PRODUCTS OR
SERVICES IN THE PREVIOUS YEARS, PROJECTED CAPACITIES FOR EXISTING
AS WELL AS PROPOSED PRODUCTS OR SERVICES AND THE ASSUMPTIONS FOR
FUTURE CAPACITY UTILIZATION FOR THE NEXT THREE YEARS IN RESPECT OF
EXISTING AS WELL AS PROPOSED PRODUCTS OR SERVICES. IF THE PROJECTED
CAPACITY UTILIZATION IS HIGHER THAN THE ACTUAL AVERAGE CAPACITY
UTILIZATION, RATIONALE TO ACHIEVE THE PROJECTED LEVELS
69
DESCRIPTION OF PROPERTY OF ISSUER 70
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LOCATION AND AREA OF THE LAND, BUILDING, PRINCIPAL PLANTS AND
OTHER PROPERTY OF THE COMPANY AND THE CONDITION THEREOF
70
WHETHER THE PROPERTY IS OWNED BY THE COMPANY OR TAKEN ON LEASE
76
DATES OF PURCHASE, LAST PAYMENT DATE OF CURRENT RENT (LVRBV) AND
MUTATION DATE OF LANDS, DEED VALUE AND OTHER COSTS INCLUDING
DETAILS OF LAND DEVELOPMENT COST, IF ANY AND CURRENT USE
THEREOF
76
THE NAMES OF THE PERSONS FROM WHOM THE LANDS HAS BEEN ACQUIRED/
PROPOSED TO BE ACQUIRED ALONG WITH THE COST OF ACQUISITION AND
RELATION, IF ANY, OF SUCH PERSONS TO THE ISSUER OR ANY SPONSOR OR
DIRECTOR THEREOF
86
DETAILS OF WHETHER THE ISSUER HAS RECEIVED ALL THE APPROVALS
PERTAINING TO USE OF THE LAND, IF REQUIRED 89
IF THE PROPERTY IS OWNED BY THE ISSUER, WHETHER THERE IS A
MORTGAGE OR OTHER TYPE OF CHARGE ON THE PROPERTY, WITH NAME OF THE
MORTGAGEE
89
IF THE PROPERTY IS TAKEN ON LEASE, THE EXPIRATION DATES OF THE
LEASE WITH NAME OF THE LESSOR, PRINCIPAL TERMS AND CONDITIONS OF
THE LEASE AGREEMENTS AND DETAILS OF PAYMENT
90
DATES OF PURCHASE OF PLANT AND MACHINERIES ALONG WITH SELLERS
NAME, ADDRESS, YEARS OF SALE, CONDITION WHEN PURCHASED, COUNTRY OF
ORIGIN, USEFUL ECONOMIC LIFE AT PURCHASE AND REMAINING ECONOMIC
LIFE, PURCHASE PRICE AND WRITTEN DOWN VALUE
90
DETAILS OF THE MACHINERIES REQUIRED TO BE BOUGHT BY THE ISSUER,
COST OF THE MACHINERIES, NAME OF THE SUPPLIERS, DATE OF PLACEMENT
OF ORDER AND THE DATE OR EXPECTED DATE OF SUPPLY, ETC
129
IN CASE THE MACHINERIES ARE YET TO BE DELIVERED, THE DATE OF
QUOTATIONS RELIED UPON FOR THE COST ESTIMATES GIVEN SHALL ALSO BE
MENTIONED
129
IF PLANT IS PURCHASED IN BRAND NEW CONDITION THEN IT SHOULD BE
MENTIONED 129
DETAILS OF THE SECOND HAND OR RECONDITIONED MACHINERIES BOUGHT
OR PROPOSED TO BE BOUGHT, IF ANY, INCLUDING THE AGE OF THE
MACHINERIES, BALANCE ESTIMATED USEFUL LIFE, ETC. AS PER PSI
CERTIFICATES OF THE SAID MACHINERIES AS SUBMITTED TO THE
COMMISSION
129
A PHYSICAL VERIFICATION REPORT BY THE ISSUE MANAGER(S) REGARDING
THE PROPERTIES AS SUBMITTED TO THE COMMISSION
129
IF THE ISSUER IS ENTITLED TO ANY INTELLECTUAL PROPERTY RIGHT OR
INTANGIBLE ASSET, FULL DESCRIPTION OF THE PROPERTY, WHETHER THE
SAME ARE LEGALLY HELD BY THE ISSUER AND WHETHER ALL FORMALITIES IN
THIS REGARD HAVE BEEN COMPLIED WITH
135
FULL DESCRIPTION OF OTHER PROPERTIES OF THE ISSUER. 136
PLAN OF OPERATION AND DISCUSSION OF FINANCIAL CONDITION OF
ISSUER 136
IF THE ISSUER HAD BEEN IN OPERATION, THE ISSUER’S REVENUE AND
RESULTS FROM OPERATION, FINANCIAL POSITION AND CHANGES IN FINANCIAL
POSITION AND CASH FLOWS FOR THE LAST FIVE YEARS OR FROM COMMERCIAL
OPERATION, WHICH IS SHORTER, SHALL BE FURNISHED IN TABULAR FORM
WHICH SHALL, AMONG OTHERS, INCLUDE THE FOLLOWING INFORMATION
136
INTERNAL AND EXTERNAL SOURCES OF CASH 137
ANY MATERIAL COMMITMENTS FOR CAPITAL EXPENDITURE AND EXPECTED
SOURCES OF FUNDS FOR SUCH EXPENDITURE 137
CAUSES FOR ANY MATERIAL CHANGES FROM PERIOD TO PERIOD IN
REVENUES, COST OF GOODS SOLD, OTHER OPERATING EXPENSES AND NET
INCOM
137
ANY SEASONAL ASPECTS OF THE ISSUER’S BUSINESS 138
ANY KNOWN TRENDS, EVENTS OR UNCERTAINTIES THAT MAY HAVE MATERIAL
EFFECT ON THE ISSUER’S FUTURE BUSINESS 138
ANY ASSETS OF THE COMPANY USED TO PAY OFF ANY LIABILITIES
138
ANY LOAN TAKEN FROM OR GIVEN TO ANY RELATED PARTY OR CONNECTED
PERSON OF THE ISSUER WITH DETAILS OF THE 139
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SAME
ANY FUTURE CONTRACTUAL LIABILITIES THE ISSUER MAY ENTER INTO
WITHIN NEXT ONE YEAR, AND THE IMPACT, IF ANY, ON THE FINANCIAL
FUNDAMENTALS OF THE ISSUER
139
THE ESTIMATED AMOUNT, WHERE APPLICABLE, OF FUTURE CAPITAL
EXPENDITURE 139
ANY VAT, INCOME TAX, CUSTOMS DUTY OR OTHER TAX LIABILITY WHICH
IS YET TO BE PAID, INCLUDING ANY CONTINGENT LIABILITIES STATING WHY
THE SAME WAS NOT PAID PRIOR TO THE ISSUANCE OF THE PROSPECTUS.
UPDATED INCOME TAX STATUS FOR THE LAST 5 YEARS OR FROM COMMERCIAL
OPERATION, WHICH IS SHORTER
139
ANY FINANCIAL COMMITMENT, INCLUDING LEASE COMMITMENT, THE
COMPANY HAD ENTERED INTO DURING THE PAST FIVE YEARS OR FROM
COMMERCIAL OPERATION, WHICH IS SHORTER, GIVING DETAILS AS TO HOW
THE LIQUIDATION WAS OR IS TO BE EFFECTED
140
DETAILS OF ALL PERSONNEL RELATED SCHEMES FOR WHICH THE COMPANY
HAS TO MAKE PROVISION FOR IN FUTURE YEARS
142
BREAK DOWN OF ALL EXPENSES RELATED TO THE PUBLIC ISSUE 143
IF THE ISSUER HAS REVALUED ANY OF ITS ASSETS, THE NAME,
QUALIFICATION AND EXPERIENCES OF THE VALUER AND THE REASON FOR THE
REVALUATION, SHOWING THE VALUE OF THE ASSETS PRIOR TO THE
REVALUATION SEPARATELY FOR EACH ASSET REVALUED IN A MANNER WHICH
SHALL FACILITATE COMPARISON BETWEEN THE HISTORICAL VALUE AND THE
AMOUNT AFTER REVALUATION AND GIVING A SUMMARY OF THE VALUATION
REPORT ALONG WITH BASIS OF PRICING AND CERTIFICATES REQUIRED UNDER
THE REVALUATION GUIDELINE OF THE COMMISSION
144
WHERE THE ISSUER IS A HOLDING/SUBSIDIARY COMPANY, FULL
DISCLOSURE ABOUT THE TRANSACTIONS, INCLUDING ITS NATURE AND AMOUNT,
BETWEEN THE ISSUER AND ITS SUBSIDIARY/HOLDING COMPANY, INCLUDING
TRANSACTIONS WHICH HAD TAKEN PLACE WITHIN THE LAST FIVE YEARS OF
THE ISSUANCE OF THE PROSPECTUS OR SINCE THE DATE OF INCORPORATION
OF THE ISSUER, WHICHEVER IS LATER, CLEARLY INDICATING WHETHER THE
ISSUER IS A DEBTOR OR A CREDITOR
145
FINANCIAL INFORMATION OF GROUP COMPANIES AND COMPANIES UNDER
COMMON OWNERSHIP BY MORE THAN 51%: FOLLOWING INFORMATION FOR THE
LAST THREE YEARS BASED ON THE AUDITED FINANCIAL STATEMENTS, IN
RESPECT OF ALL THE GROUP COMPANIES OF THE ISSUER, WHEREVER
APPLICABLE, ALONG WITH SIGNIFICANT NOTES OF AUDITORS:
146
DATE OF INCORPORATION 146
NATURE OF BUSINESS 146
EQUITY CAPITAL 146
RESERVES 146
SALES 146
PROFIT AFTER TAX 146
EARNINGS PER SHARE AND DILUTED EARNINGS PER SHARE 146
NET ASSET VALUE 146
THE HIGHEST AND LOWEST MARKET PRICE OF SHARES DURING THE
PRECEDING SIX MONTHS WITH DISCLOSURES FOR CHANGES IN CAPITAL
STRUCTURE DURING THE PERIOD, IF ANY SECURITIES OF THE GROUP ARE
LISTED WITH ANY EXCHANGE
146
INFORMATION REGARDING SIGNIFICANT ADVERSE FACTORS RELATING TO
THE GROUP 146
ANY OF THE GROUP COMPANIES HAS BECOME SICK OR IS UNDER WINDING
UP 146
THE RELATED BUSINESS TRANSACTIONS WITHIN THE GROUP AND THEIR
SIGNIFICANCE ON THE FINANCIAL PERFORMANCE OF THE ISSUER
147
SALES OR PURCHASE BETWEEN GROUP COMPANIES/ SUBSIDIARIES/
ASSOCIATE COMPANIES WHEN SUCH SALES OR PURCHASES EXCEED IN VALUE IN
THE AGGREGATE TEN PER CENT OF THE TOTAL SALES OR PURCHASES OF THE
ISSUER AND ALSO MATERIAL ITEMS OF INCOME OR EXPENDITURE ARISING OUT
OF SUCH TRANSACTIONS
148
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WHERE THE ISSUER IS A BANKING COMPANY, INSURANCE COMPANY,
NON-BANKING FINANCIAL INSTITUTION OR ANY OTHER COMPANY WHICH IS
REGULATED AND LICENSED BY ANOTHER PRIMARY REGULATOR, A DECLARATION
BY THE BOARD OF DIRECTORS SHALL BE INCLUDED IN THE PROSPECTUS
STATING THAT ALL REQUIREMENTS OF THE RELEVANT LAWS AND REGULATORY
REQUIREMENTS OF ITS PRIMARY REGULATOR HAVE BEEN ADHERED TO BY THE
ISSUER
148
A REPORT FROM THE AUDITORS REGARDING ANY ALLOTMENT OF SHARES TO
ANY PERSON FOR ANY CONSIDERATION OTHERWISE THAN CASH ALONG WITH
RELATIONSHIP OF THAT PERSON WITH THE ISSUER AND RATIONALE OF ISSUE
PRICE OF THE SHARES
148
ANY MATERIAL INFORMATION, WHICH IS LIKELY TO HAVE AN IMPACT ON
THE OFFERING OR CHANGE THE TERMS AND CONDITIONS UNDER WHICH THE
OFFER HAS BEEN MADE TO THE PUBLIC
150
BUSINESS STRATEGIES AND FUTURE PLANS - PROJECTED FINANCIAL
STATEMENTS SHALL BE REQUIRED ONLY FOR COMPANIES NOT STARTED
COMMERCIAL OPERATION YET AND AUTHENTICATED BY CHAIRMAN, TWO
DIRECTORS, MANAGING DIRECTOR, CFO, AND COMPANY SECRETARY
150
DISCUSSION ON THE RESULTS OF OPERATIONS SHALL INTER-ALIA CONTAIN
THE FOLLOWING 150
A SUMMARY OF THE PAST FINANCIAL RESULTS AFTER ADJUSTMENTS AS
GIVEN IN THE AUDITOR’S REPORT CONTAINING SIGNIFICANT ITEMS OF
INCOME AND EXPENDITURE
150
A SUMMARY OF MAJOR ITEMS OF INCOME AND EXPENDITURE 151
THE INCOME AND SALES ON ACCOUNT OF MAJOR PRODUCTS OR SERVICES
151
IN CASE, OTHER INCOME CONSTITUTES MORE THAN 10% OF THE TOTAL
INCOME, THE BREAKUP OF THE SAME ALONG WITH THE NATURE OF THE
INCOME, I.E., RECURRING OR NON-RECURRING
151
IF A MATERIAL PART OF THE INCOME IS DEPENDENT UPON A SINGLE
CUSTOMER OR A FEW MAJOR CUSTOMERS, DISCLOSURE OF THIS FACT ALONG
WITH RELEVANT DATA. SIMILARLY IF ANY FOREIGN CUSTOMER CONSTITUTES A
SIGNIFICANT PORTION OF THE ISSUER’S BUSINESS, DISCLOSURE OF THE
FACT ALONG WITH ITS IMPACT ON THE BUSINESS CONSIDERING EXCHANGE
RATE FLUCTUATIONS
151
IN CASE THE ISSUER HAS FOLLOWED ANY UNORTHODOX PROCEDURE FOR
RECORDING SALES AND REVENUES, ITS IMPACT SHALL BE ANALYZED AND
DISCLOSED
151
COMPARISON OF RECENT FINANCIAL YEAR WITH THE PREVIOUS FINANCIAL
YEARS ON THE MAJOR HEADS OF THE PROFIT AND LOSS STATEMENT,
INCLUDING AN ANALYSIS OF REASONS FOR THE CHANGES IN SIGNIFICANT
ITEMS OF INCOME AND EXPENDITURE, INTER-ALIA, CONTAINING THE
FOLLOWING
152
UNUSUAL OR INFREQUENT EVENTS OR TRANSACTIONS INCLUDING UNUSUAL
TRENDS ON ACCOUNT OF BUSINESS ACTIVITY, UNUSUAL ITEMS OF INCOME,
CHANGE OF ACCOUNTING POLICIES AND DISCRETIONARY REDUCTION OF
EXPENSES ETC
152
SIGNIFICANT ECONOMIC CHANGES THAT MATERIALLY AFFECT OR ARE
LIKELY TO AFFECT INCOME FROM CONTINUING OPERATIONS
152
KNOWN TRENDS OR UNCERTAINTIES THAT HAVE HAD OR ARE EXPECTED TO
HAVE A MATERIAL ADVERSE IMPACT ON SALES, REVENUE OR INCOME FROM
CONTINUING OPERATIONS
152
FUTURE CHANGES IN RELATIONSHIP BETWEEN COSTS AND REVENUES, IN
CASE OF EVENTS SUCH AS FUTURE INCREASE IN LABOR OR MATERIAL COSTS
OR PRICES THAT WILL CAUSE A MATERIAL CHANGE ARE KNOWN
153
THE EXTENT TO WHICH MATERIAL INCREASES IN NET SALES OR REVENUE
ARE DUE TO INCREASED SALES VOLUME, INTRODUCTION OF NEW PRODUCTS OR
SERVICES OR INCREASED SALES PRICES
153
TOTAL TURNOVER OF EACH MAJOR INDUSTRY SEGMENT IN WHICH THE
ISSUER OPERATED 153
STATUS OF ANY PUBLICLY ANNOUNCED NEW PRODUCTS OR BUSINESS
SEGMENT 153
THE EXTENT TO WHICH THE BUSINESS IS SEASONAL 153
DEFAULTS OR RESCHEDULING OF BORROWINGS WITH FINANCIAL
INSTITUTIONS OR BANKS, CONVERSION OF LOANS INTO EQUITY ALONG WITH
REASONS THEREOF, LOCK OUT, STRIKES AND REASONS FOR THE SAME ETC.
DURING THE HISTORY OF OPERATION OF THE COMPANY
153
DETAILS REGARDING THE CHANGES IN THE ACTIVITIES OF THE ISSUER
DURING THE LAST FIVE YEARS WHICH MAY HAD A MATERIAL EFFECT ON THE
PROFITS/LOSS, INCLUDING DISCONTINUANCE OF LINES OF BUSINESS, LOSS
OF AGENCIES OR
154
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MARKETS AND SIMILAR FACTORS
INJUNCTION OR RESTRAINING ORDER, IF ANY, WITH POSSIBLE
IMPLICATIONS 154
TECHNOLOGY, MARKET, MANAGERIAL COMPETENCE AND CAPACITY BUILT-UP
154
CHANGES IN ACCOUNTING POLICIES IN THE LAST THREE YEARS 155
SIGNIFICANT DEVELOPMENTS SUBSEQUENT TO THE LAST FINANCIAL YEAR:
A STATEMENT BY THE DIRECTORS WHETHER IN THEIR OPINION THERE HAVE
ARISEN ANY CIRCUMSTANCES SINCE THE DATE OF THE LAST FINANCIAL
STATEMENTS AS DISCLOSED IN THE RED-HERRING
PROSPECTUS/PROSPECTUS/INFORMATION MEMORANDUM AND WHICH MATERIALLY
AND ADVERSELY AFFECT OR IS LIKELY TO AFFECT THE TRADING OR
PROFITABILITY OF THE ISSUER, OR THE VALUE OF ITS ASSETS, OR ITS
ABILITY TO PAY ITS LIABILITIES WITHIN THE NEXT TWELVE MONTHS
156
IF ANY QUARTER OF THE FINANCIAL YEAR OF THE ISSUER ENDS AFTER
THE PERIOD ENDED IN THE AUDITED FINANCIAL STATEMENTS AS DISCLOSED
IN THE PROSPECTUS OR INFORMATION MEMORANDUM, UNAUDITED FINANCIAL
STATEMENTS FOR EACH OF THE SAID QUARTERS DULY AUTHENTICATED BY THE
CEO AND CFO OF THE ISSUER OR INFORMATION MEMORANDUM, UNAUDITED
FINANCIAL STATEMENTS FOR EACH OF THE SAID QUARTERS DULY
AUTHENTICATED BY THE CEO AND CFO OF THE ISSUE
156
FACTORS THAT MAY AFFECT THE RESULTS OF OPERATIONS 156
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS 157
OVERVIEW OF BUSINESS AND STRATEGIES 157
SWOT ANALYSIS 158
ANALYSIS OF THE FINANCIAL STATEMENTS OF LAST FIVE YEARS WITH
REASON(S) OF FLUCTUATING REVENUE/SALES, OTHER INCOME, TOTAL INCOME,
COST OF MATERIAL, FINANCE COST, DEPRECIATION AND AMORTIZATION
EXPENSE, OTHER EXPENSE; CHANGES OF INVENTORIES, NET PROFIT BEFORE
& AFTER TAX, EPS ETC.
159
KNOWN TRENDS DEMANDS, COMMITMENTS, EVENTS OR UNCERTAINTIES THAT
ARE LIKELY TO HAVE AN EFFECT ON THE COMPANY’S BUSINESS
160
TRENDS OR EXPECTED FLUCTUATIONS IN LIQUIDITY 160
OFF-BALANCE SHEET ARRANGEMENTS THOSE HAVE OR LIKELY TO HAVE A
CURRENT OR FUTURE EFFECT ON FINANCIAL CONDITION
160
DIRECTORS AND OFFICERS 161
NAME, FATHER’S NAME, AGE, RESIDENTIAL ADDRESS, EDUCATIONAL
QUALIFICATION, EXPERIENCE AND POSITION OF EACH OF THE DIRECTORS OF
THE COMPANY AND ANY PERSON NOMINATED/REPRESENTED TO BE A DIRECTOR,
SHOWING THE PERIOD FOR WHICH THE OMINATION HAS BEEN MADE AND THE
NAME OF THE ORGANIZATION WHICH HAS NOMINATED HIM;
161
THE DATE ON WHICH HE FIRST BECAME A DIRECTOR AND THE DATE ON
WHICH HIS CURRENT TERM OF OFFICE SHALL EXPIRE
162
IF ANY DIRECTOR HAS ANY TYPE OF INTEREST IN OTHER BUSINESSES,
NAMES AND TYPES OF BUSINESS OF SUCH ORGANIZATIONS. IF ANY DIRECTOR
IS ALSO A DIRECTOR OF ANOTHER COMPANY OR OWNER OR PARTNER OF ANY
OTHER CONCERN, THE NAMES OF SUCH ORGANIZATIONS
162
STATEMENT OF IF ANY OF THE DIRECTORS OF THE ISSUER ARE
ASSOCIATED WITH THE SECURITIES MARKET IN ANY MANNER. IF ANY
DIRECTOR OF THE ISSUER COMPANY IS ALSO A DIRECTOR OF ANY ISSUER OF
OTHER LISTED SECURITIES DURING LAST THREE YEARS THEN DIVIDEND
PAYMENT HISTORY AND MARKET PERFORMANCE OF THAT ISSUER
163
ANY FAMILY RELATIONSHIP (FATHER, MOTHER, SPOUSE, BROTHER,
SISTER, SON, DAUGHTER, SPOUSE’S FATHER, SPOUSE’S MOTHER, SPOUSE’S
BROTHER, SPOUSE’S SISTER) AMONG THE DIRECTORS AND TOP FIVE
OFFICERS
164
A VERY BRIEF DESCRIPTION OF OTHER BUSINESSES OF THE DIRECTORS
164
SHORT BIO-DATA OF EACH DIRECTOR 167
LOAN STATUS OF THE ISSUER, ITS DIRECTORS AND SHAREHOLDERS WHO
HOLD 10% OR MORE SHARES IN THE PAID-UP CAPITAL OF THE ISSUER IN
TERMS OF THE CIB REPORT OF BANGLADESH BANK
169
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NAME WITH POSITION, EDUCATIONAL QUALIFICATION, AGE, DATE OF
JOINING IN THE COMPANY, OVERALL EXPERIENCE (IN YEAR), PREVIOUS
EMPLOYMENT, SALARY PAID FOR THE FINANCIAL YEAR OF THE CHIEF
EXECUTIVE OFFICER, MANAGING DIRECTOR, CHIEF FINANCIAL OFFICER,
COMPANY SECRETARY, ADVISERS, CONSULTANTS AND ALL DEPARTMENTAL
HEADS. IF THE CHAIRMAN, ANY DIRECTOR OR ANY SHAREHOLDER RECEIVED
ANY MONTHLY SALARY THAN THIS INFORMATION SHOULD ALSO BE
INCLUDED
170
CHANGES IN THE KEY MANAGEMENT PERSONS DURING THE LAST THREE
YEARS. ANY CHANGE OTHERWISE THAN BY WAY OF RETIREMENT IN THE NORMAL
COURSE IN THE SENIOR KEY MANAGEMENT PERSONNEL PARTICULARLY IN
CHARGE OF PRODUCTION, PLANNING, FINANCE AND MARKETING DURING THE
LAST THREE YEARS PRIOR TO THE DATE OF FILING THE INFORMATION
MEMORANDUM. IF THE TURNOVER OF KEY MANAGEMENT PERSONNEL IS HIGH
COMPARED TO THE INDUSTRY, REASONS SHOULD BE DISCUSSED
170
A PROFILE OF THE SPONSORS INCLUDING THEIR NAMES, FATHER’S NAMES,
AGE, PERSONAL ADDRESSES, EDUCATIONAL QUALIFICATIONS, AND
EXPERIENCES IN THE BUSINESS, POSITIONS/POSTS HELD IN THE PAST,
DIRECTORSHIP HELD, OTHER VENTURES OF EACH SPONSOR AND PRESENT
POSITION
171
IF THE PRESENT DIRECTORS ARE NOT THE SPONSORS AND CONTROL OF THE
ISSUER WAS ACQUIRED WITHIN FIVE YEARS IMMEDIATELY PRECEDING THE
DATE OF FILING PROSPECTUS DETAILS REGARDING THE ACQUISITION OF
CONTROL, DATE OF ACQUISITION, TERMS OF ACQUISITION, CONSIDERATION
PAID FOR SUCH ACQUISITION ETC
172
IF THE SPONSORS/DIRECTORS DO NOT HAVE EXPERIENCE IN THE PROPOSED
LINE OF BUSINESS, THE FACT EXPLAINING HOW THE PROPOSED ACTIVITIES
WOULD BE CARRIED OUT/MANAGED
172
INTEREST OF THE KEY MANAGEMENT PERSONS 172
ALL INTERESTS AND FACILITIES ENJOYED BY A DIRECTOR, WHETHER
PECUNIARY OR NON-PECUNIARY 173
NUMBER OF SHARES HELD AND PERCENTAGE OF SHAREHOLDING (PRE-ISSUE)
173
CHANGE IN BOARD OF DIRECTORS DURING LAST THREE YEARS 174
DIRECTOR’S ENGAGEMENT WITH SIMILAR BUSINESS 174
CERTAIN RELATIONSHIP AND RELATED TRANSACTIONS INCLUDED 175
THE PROSPECTUS SHALL CONTAIN A DESCRIPTION OF ANY TRANSACTION
DURING THE LAST FIVE YEARS, OR ANY PROPOSED TRANSACTIONS CERTIFIED
BY THE AUDITORS, BETWEEN THE ISSUER AND ANY OF THE FOLLOWING
PERSONS, GIVING THE NAME OF THE PERSONS INVOLVED IN THE
TRANSACTION, THEIR RELATIONSHIP WITH THE ISSUER, THE NATURE OF
THEIR INTEREST IN THE TRANSACTION AND THE AMOUNT OF SUCH
INTEREST,
175
ANY TRANSACTION OR ARRANGEMENT ENTERED INTO BY THE ISSUER OR ITS
SUBSIDIARY OR ASSOCIATE OR ENTITY OWNED OR SIGNIFICANTLY INFLUENCED
BY A PERSON WHO IS CURRENTLY A DIRECTOR OR IN ANY WAY CONNECTED
WITH A DIRECTOR OF EITHER THE ISSUER COMPANY OR ANY OF ITS
SUBSIDIARIES/HOLDING COMPANY OR ASSOCIATE CONCERNS, OR WHO WAS A
DIRECTOR OR CONNECTED IN ANY WAY WITH A DIRECTOR AT ANY TIME DURING
THE LAST THREE YEARS PRIOR TO THE ISSUANCE OF THE PROSPECTUS
183
ANY LOANS EITHER TAKEN OR GIVEN FROM OR TO ANY DIRECTOR OR ANY
PERSON CONNECTED WITH THE DIRECTOR, CLEARLY SPECIFYING DETAILS OF
SUCH LOAN IN THE PROSPECTUS, AND IF ANY LOAN HAS BEEN TAKEN FROM
ANY SUCH PERSON WHO DID NOT HAVE ANY STAKE IN THE ISSUER, ITS
HOLDING COMPANY OR ITS ASSOCIATE CONCERNS PRIOR TO SUCH LOAN, RATE
OF INTEREST APPLICABLE, DATE OF LOAN TAKEN, DATE OF MATURITY OF
LOAN, AND PRESENT OUTSTANDING OF SUCH LOAN
183
EXECUTIVE COMPENSATION 184
THE TOTAL AMOUNT OF REMUNERATION/SALARY/PERQUISITES PAID TO THE
TOP FIVE SALARIED OFFICERS OF THE ISSUER IN THE LAST ACCOUNTING
YEAR AND THE NAME AND DESIGNATION OF EACH SUCH OFFICER
184
AGGREGATE AMOUNT OF REMUNERATION PAID TO ALL DIRECTORS AND
OFFICERS AS A GROUP DURING THE LAST ACCOUNTING YEAR
184
IF ANY SHAREHOLDER DIRECTOR RECEIVED ANY MONTHLY
SALARY/PERQUISITE/BENEFIT IT MUST BE MENTIONED ALONG WITH DATE OF
APPROVAL IN AGM/EGM, TERMS THEREOF AND PAYMENTS MADE DURING THE
LAST ACCOUNTING YEAR
184
THE BOARD MEETING ATTENDANCE FEES RECEIVED BY THE DIRECTOR
INCLUDING THE MANAGING DIRECTOR ALONG WITH DATE OF APPROVAL IN
AGM/EGM
185
ANY CONTRACT WITH ANY DIRECTOR OR OFFICER PROVIDING FOR THE
PAYMENT OF FUTURE COMPENSATION 185
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IF THE ISSUER INTENDS TO SUBSTANTIALLY INCREASE THE REMUNERATION
PAID TO ITS DIRECTORS AND OFFICERS IN THE CURRENT YEAR, APPROPRIATE
INFORMATION REGARDING THERETO
185
ANY OTHER BENEFIT/FACILITY PROVIDED TO THE ABOVE PERSONS DURING
THE LAST ACCOUNTING YEAR 185
OPTION HELD BY EACH DIRECTOR, THE SALARIED OFFICERS, AND ALL
OTHER OFFICERS 185
TRANSACTION WITH THE DIRECTORS AND SUBSCRIBERS TO THE MEMORANDUM
186
THE NAMES OF THE DIRECTORS AND SUBSCRIBERS TO THE MEMORANDUM,
THE NATURE AND AMOUNT OF ANYTHING OF VALUE RECEIVED OR TO BE
RECEIVED BY THE ISSUER FROM THE ABOVE PERSONS, OR BY THE SAID
PERSONS, DIRECTLY OR INDIRECTLY, FROM THE ISSUER DURING THE LAST
FIVE YEARS ALONG WITH THE DESCRIPTION OF ASSETS, SERVICES OR OTHER
CONSIDERATION RECEIVED OR TO BE RECEIVED
186
IF ANY ASSETS WERE ACQUIRED OR TO BE ACQUIRED FROM WITHIN TWO
FINANCIAL YEARS THE AFORESAID PERSONS, THE AMOUNT PAID FOR SUCH
ASSETS AND THE METHOD USED TO DETERMINE THE PRICE SHALL BE
MENTIONED IN THE PROSPECTUS, AND IF THE ASSETS WERE ACQUIRED BY THE
SAID PERSONS WITHIN FIVE YEARS PRIOR TO TRANSFER THOSE TO THE
ISSUER, THE ACQUISITION COST THEREOF PAID BY THEM
186
OWNERSHIP OF COMPANY’S SECURITIES FURNISHED 187
THE NAMES, ADDRESSES, BO ID NUMBER OF ALL SHAREHOLDERS OF THE
COMPANY BEFORE IPO, INDICATING THE AMOUNT OF SECURITIES OWNED AND
THE PERCENTAGE OF THE SECURITIES REPRESENTED BY SUCH OWNERSHIP, IN
TABULAR FORM
187
THERE SHALL ALSO BE A TABLE SHOWING THE NAME AND ADDRESS, AGE,
EXPERIENCE, BO ID NUMBER, TIN NUMBER, NUMBERS OF SHARES HELD
INCLUDING PERCENTAGE, POSITION HELD IN OTHER COMPANIES OF ALL THE
DIRECTORS BEFORE THE PUBLIC ISSUE
194
THE AVERAGE COST OF ACQUISITION OF EQUITY SHARES BY THE
DIRECTORS CERTIFIED BY THE AUDITORS 196
A DETAIL DESCRIPTION OF CAPITAL BUILT UP IN RESPECT OF
SHAREHOLDING (NAME-WISE) OF THE ISSUER’S SPONSORS/ DIRECTORS. IN
THIS CONNECTION, A STATEMENT TO BE INCLUDED
196
DETAIL OF SHARES ISSUED BY THE COMPANY AT A PRICE LOWER THAN THE
ISSUE PRICE 199
HISTORY OF SIGNIFICANT (5% OR MORE) CHANGES IN OWNERSHIP OF
SECURITIES FROM INCEPTION 199
CORPORATE GOVERNANCE 200
A DISCLOSURE TO THE EFFECT THAT THE ISSUER HAS COMPLIED WITH THE
REQUIREMENTS OF CORPORATE GOVERNANCE GUIDELINES OF THE
COMMISSION
200
A COMPLIANCE REPORT OF CORPORATE GOVERNANCE REQUIREMENTS
CERTIFIED BY COMPETENT AUTHORITY 200
DETAILS RELATING TO THE ISSUER'S AUDIT COMMITTEE AND
REMUNERATION COMMITTEE, INCLUDING THE NAMES OF COMMITTEE MEMBERS
AND A SUMMARY OF THE TERMS OF REFERENCE UNDER WHICH THE COMMITTEES
OPERATE
212
VALUATION REPORT OF SECURITIES PREPARED BY THE ISSUE MANAGER
214
MATERIAL INFORMATION FURNISHED REGARDING DEBT SECURITIES ISSUED
OR TO BE ISSUED 220
PARTIES INVOLVED AND THEIR RESPONSIBILITIES 220
ISSUE MANAGER(S) 220
UNDERWRITERS 220
AUDITORS 220
COST AND MANAGEMENT ACCOUNTANTS 220
VALUER 220
CREDIT RATING COMPANY 220
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DISCLOSURE REGARDING MATERIAL CONTRACTS 221
MAJOR AGREEMENTS ENTERED INTO BY THE ISSUER 221
MATERIAL PARTS OF THE AGREEMENTS 221
FEES PAYABLE TO DIFFERENT PARTIES 224
DISCLOSURE REGARDING LITIGATIONS, FINE OR PENALTY FURNISHED IN
THE PROSPECTUS 225
RISK FACTORS AND MANAGEMENT’S PERCEPTION ABOUT THE RISKS 227
INTERNAL RISK FACTORS MAY INCLUDE, AMONG OTHERS 227
CREDIT RISK 227
LIQUIDITY RISK 227
RISK ASSOCIATED WITH THE ISSUER’S INTEREST IN SUBSIDIARIES,
JOINT VENTURES AND ASSOCIATE 227
SIGNIFICANT REVENUE GENERATED FROM LIMITED NUMBER OF CUSTOMERS,
LOSING ANY ONE OR MORE OF WHICH WOULD HAVE A MATERIAL ADVERSE
EFFECT ON THE ISSUER
228
DEPENDENCY ON A SINGLE OR FEW SUPPLIERS OF RAW MATERIALS,
FAILURE OF WHICH MAY AFFECT PRODUCTION ADVERSELY
228
MORE THAN 20% REVENUE OF THE ISSUER COMES FROM SISTER CONCERN OR
ASSOCIATE OR SUBSIDIARY 228
NEGATIVE EARNINGS, NEGATIVE CASH FLOWS FROM OPERATING
ACTIVITIES, DECLINING TURNOVER OR PROFITABILITY, DURING LAST FIVE
YEARS, IF ANY
228
LOSS MAKING ASSOCIATE/SUBSIDIARY/GROUP COMPANIES OF THE ISSUER
228
FINANCIAL WEAKNESS AND POOR PERFORMANCE OF THE ISSUER OR ANY OF
ITS SUBSIDIARY OR ASSOCIATES 229
DECLINE IN VALUE OF ANY INVESTMENT 229
RISK ASSOCIATED WITH USEFUL ECONOMIC LIFE OF PLANT AND
MACHINERY, IF PURCHASED IN SECOND HAND OR RECONDITIONED
229
ADVERSE EFFECT ON FUTURE CASH FLOW IF INTEREST FREE LOAN GIVEN
TO RELATED PARTY OR SUCH LOANS TAKEN FROM DIRECTORS MAY
RECALLED
229
POTENTIAL CONFLICT OF INTEREST, IF THE SPONSORS OR DIRECTORS OF
THE ISSUER ARE INVOLVED WITH ONE OR MORE VENTURES WHICH ARE IN THE
SAME LINE OF ACTIVITY OR BUSINESS AS THAT OF THE ISSUER AND IF ANY
SUPPLIER OF RAW MATERIALS OR MAJOR CUSTOMER IS RELATED TO THE SAME
SPONSORS OR DIRECTORS;
229
RELATED PARTY TRANSACTIONS ENTERED INTO BY THE COMPANY THOSE MAY
ADVERSELY AFFECT COMPETITIVE EDGE 229
ANY RESTRICTIVE COVENANTS IN ANY SHAREHOLDERS' AGREEMENT,
SPONSORS' AGREEMENT OR ANY AGREEMENT FOR DEBT OR PREFERENCE SHARES
OR ANY RESTRICTIVE COVENANTS OF BANKS IN RESPECT OF THE LOAN/
CREDIT LIMIT AND OTHER BANKING FACILITIES
230
BUSINESS OPERATIONS MAY BE ADVERSELY AFFECTED BY STRIKES, WORK
STOPPAGES OR INCREASE IN WAGE DEMANDS BY EMPLOYEES
230
SEASONALITY OF THE BUSINESS OF THE ISSUER 230
EXPIRY OF ANY REVENUE GENERATING CONTRACT THAT MAY ADVERSELY
AFFECT THE BUSINESS 230
EXCESSIVE DEPENDENCE ON DEBT FINANCING WHICH MAY ADVERSELY
AFFECT THE CASH FLOW 230
EXCESSIVE DEPENDENCE ON ANY KEY MANAGEMENT PERSONNEL ABSENCE OF
WHOM MAY HAVE ADVERSE EFFECT ON THE ISSUER’S BUSINESS
PERFORMANCE
230
ENFORCEMENT OF CONTINGENT LIABILITIES WHICH MAY ADVERSELY AFFECT
FINANCIAL CONDITION 230
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INSURANCE COVERAGE NOT ADEQUATELY PROTECT AGAINST CERTAIN RISKS
OF DAMAGES 231
ABSENCE OF ASSURANCE THAT DIRECTORS WILL CONTINUE ITS ENGAGEMENT
WITH COMPANY AFTER EXPIRY OF LOCK IN PERIOD
231
ABILITY TO PAY ANY DIVIDENDS IN FUTURE WILL DEPEND UPON FUTURE
EARNINGS, FINANCIAL CONDITION, CASH FLOWS, WORKING CAPITAL
REQUIREMENTS AND CAPITAL EXPENDITURE
231
HISTORY OF NON OPERATION, IF ANY AND SHORT OPERATIONAL HISTORY
OF THE ISSUER AND LACK OF ADEQUATE BACKGROUND AND EXPERIENCE OF THE
SPONSORS
231
RISKS RELATED TO ENGAGEMENT IN NEW TYPE OF BUSINESS, IF ANY
231
RISK IN INVESTING THE SECURITIES BEING OFFERED WITH COMPARISON
TO OTHER AVAILABLE INVESTMENT OPTIONS 231
ANY PENALTY OR ACTION TAKEN BY ANY REGULATORY AUTHORITIES FOR
NON-COMPLIANCE WITH PROVISIONS OF ANY LAW
232
LITIGATIONS AGAINST THE ISSUER FOR TAX AND VAT RELATED MATTERS
AND OTHER GOVERNMENT CLAIMS, ALONG WITH THE DISCLOSURES OF AMOUNT,
PERIOD FOR WHICH SUCH DEMANDS OR CLAIMS ARE OUTSTANDING, FINANCIAL
IMPLICATIONS AND THE STATUS OF THE CASE
232
REGISTERED OFFICE OR FACTORY BUILDING OR PLACE OF OPERATION IS
NOT OWNED BY THE ISSUER 232
LACK OF RENEWAL OF EXISTING REGULATORY PERMISSIONS/ LICENSES
232
FAILURE IN HOLDING AGM OR DECLARING DIVIDEND OR PAYMENT OF
INTEREST BY ANY LISTED SECURITIES OF THE ISSUER OR ANY OF ITS
SUBSIDIARIES OR ASSOCIATES
232
ISSUANCES OF SECURITIES AT LOWER THAN THE IPO OFFER PRICE WITHIN
ONE YEAR 232
REFUSAL OF APPLICATION FOR PUBLIC ISSUE OF ANY SECURITIES OF THE
ISSUER OR ANY OF ITS SUBSIDIARIES OR ASSOCIATES AT ANY TIME BY THE
COMMISSION
232
EXTERNAL RISK FACTORS MAY INCLUDE AMONG OTHERS 233
INTEREST RATE RISKS 233
EXCHANGE RATE RISKS 233
INDUSTRY RISKS 233
ECONOMIC AND POLITICAL RISKS 234
MARKET AND TECHNOLOGY-RELATED RISKS 234
POTENTIAL OR EXISTING GOVERNMENT REGULATIONS 235
POTENTIAL OR EXISTING CHANGES IN GLOBAL OR NATIONAL POLICIES
235
STATUTORY CLEARANCES AND APPROVALS THOSE ARE YET TO BE RECEIVED
BY THE ISSUER 235
COMPETITIVE CONDITION OF THE BUSINESS 235
COMPLEMENTARY AND SUPPLEMENTARY PRODUCTS/SERVICES WHICH MAY HAVE
AN IMPACT ON BUSINESS OF THE ISSUER.
235
OTHER RISK FACTORS 236
DESCRIPTION OF THE ISSUE 238
USE OF PROCEEDS 243
USE OF NET PROCEEDS OF THE OFFER INDICATING THE AMOUNT TO BE
USED FOR EACH PURPOSE WITH HEAD-WISE BREAK-UP
243
UTILIZATION OF THE TOTAL AMOUNT OF PAID-UP CAPITAL AND SHARE
PREMIUM, IF ANY, INCLUDING THE SPONSORS’ 246
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CONTRIBUTION AND CAPITAL RAISED OF THE ISSUER AT THE TIME OF
SUBMISSION OF PROSPECTUS, IN DETAILS WITH INDICATION OF USE OF SUCH
FUNDS IN THE FINANCIAL STATEMENTS
IF ONE OF THE OBJECTS IS AN INVESTMENT IN A JOINT VENTURE, A
SUBSIDIARY, AN ASSOCIATE OR ANY ACQUISITION, DETAILS OF THE FORM OF
INVESTMENT, NATURE OF BENEFIT EXPECTED TO ACCRUE TO THE ISSUER AS A
RESULT OF THE INVESTMENT, BRIEF DESCRIPTION OF BUSINESS AND
FINANCIALS OF SUCH VENTURE
247
IF IPO PROCEEDS ARE NOT SUFFICIENT TO COMPLETE THE PROJECT, THEN
SOURCE OF ADDITIONAL FUND MUST BE MENTIONED. IN THIS CONNECTION,
COPIES OF CONTRACT TO MEET THE ADDITIONAL FUNDS ARE REQUIRED TO BE
SUBMITTED TO THE COMMISSION. THE MEANS AND SOURCE OF FINANCING,
INCLUDING DETAILS OF BRIDGE LOAN OR OTHER FINANCIAL ARRANGEMENT,
WHICH MAY BE REPAID FROM THE PROCEEDS OF THE ISSUE ALONG WITH
UTILIZATION OF SUCH FUNDS
247
A SCHEDULE MENTIONING THE STAGES OF IMPLEMENTATION AND
UTILIZATION OF FUNDS RECEIVED THROUGH PUBLIC OFFER IN A TABULAR
FORM, PROGRESS MADE SO FAR, GIVING DETAILS OF LAND ACQUISITION,
CIVIL WORKS, INSTALLATION OF PLANT AND MACHINERY, THE APPROXIMATE
DATE OF COMPLETION OF THE PROJECT AND THE PROJECTED DATE OF FULL
COMMERCIAL OPERATION ETC. THE SCHEDULE SHALL BE SIGNED BY THE CHIEF
EXECUTIVE OFFICER OR MANAGING DIRECTOR, CHIEF FINANCIAL OFFICER AND
CHAIRMAN ON BEHALF OF BOARD OF DIRECTORS OF THE ISSUER
247
IF THERE ARE CONTRACTS COVERING ANY OF THE ACTIVITIES OF THE
ISSUER FOR WHICH THE PROCEEDS OF SALE OF SECURITIES ARE TO BE USED,
SUCH AS CONTRACTS FOR THE PURCHASE OF LAND OR CONTRACTS FOR THE
CONSTRUCTION OF BUILDINGS, THE ISSUER SHALL DISCLOSE THE TERMS OF
SUCH CONTRACTS, AND COPIES OF THE CONTRACTS SHALL BE ENCLOSED AS
ANNEXURE TO THE PROSPECTUS
248
IF ONE OF THE OBJECTS OF THE ISSUE IS UTILIZATION OF THE ISSUE
PROCEEDS FOR WORKING CAPITAL, BASIS OF ESTIMATION OF WORKING
CAPITAL REQUIREMENT ALONG WITH THE RELEVANT ASSUMPTIONS, REASONS
FOR RAISING ADDITIONAL WORKING CAPITAL SUBSTANTIATING THE SAME WITH
RELEVANT FACTS AND FIGURES AND ALSO THE REASONS FOR FINANCING SHORT
WITH LONG TERM INVESTMENTS AND AN ITEM WISE BREAK-UP OF LAST THREE
YEARS WORKING CAPITAL AND NEXT TWO YEARS PROJECTION
248
WHERE THE ISSUER PROPOSES TO UNDERTAKE ONE OR MORE ACTIVITIES
LIKE DIVERSIFICATION, MODERNIZATION, EXPANSION, ETC., THE TOTAL
PROJECT COST ACTIVITY-WISE OR PROJECT WISE, AS THE CASE MAY BE
248
WHERE THE ISSUER IS IMPLEMENTING THE PROJECT IN A PHASED MANNER,
THE COST OF EACH PHASE, INCLUDING THE PHASES, IF ANY, WHICH HAVE
ALREADY BEEN IMPLEMENTED
248
THE DETAILS OF ALL EXISTING OR ANTICIPATED MATERIAL TRANSACTIONS
IN RELATION TO UTILIZATION OF THE ISSUE PROCEEDS OR PROJECT COST
WITH SPONSORS, DIRECTORS, KEY MANAGEMENT PERSONNEL, ASSOCIATES AND
GROUP COMPANIES
248
SUMMARY OF THE PROJECT APPRAISAL OR FEASIBILITY REPORT BY THE
RELEVANT PROFESSIONALS NOT CONNECTED WITH THE ISSUER, ISSUE MANAGER
AND REGISTRAR TO THE ISSUE WITH COST OF THE PROJECT AND MEANS OF
FINANCE, WEAKNESSES AND THREATS, IF ANY, AS GIVEN IN THE APPRAISAL
OR FEASIBILITY REPORT
248
PROVISIONS FOR LOCK IN 253
STATEMENT REGARDING LOCK-IN ON EXISTING SHARES 253
INFORMATION REGARDING MARKETS FOR THE SECURITIES BEING OFFERED
257
DESCRIPTION OF SECURITIES OUTSTANDING OR BEING OFFERED 258
DIVIDEND, VOTING AND PREEMPTION RIGHTS 258
CONVERSION AND LIQUIDATION RIGHTS 258
DIVIDEND POLICY 259
OTHER RIGHTS OF THE SECURITIES HOLDERS 259
FINANCIAL STATEMENTS 260
INFORMATION AS IS REQUIRED UNDER SECTION 186 OF THE 1994
RELATING TO HOLDING COMPANY
INCLUDED 320
RATIOS ON LIQUIDITY, OPERATING PROFITABILITY, COVERAGE AND CASH
FLOW OF THE ISSUER AS SPECIFIED IN ANNEXURE D INCLUDED
404
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COMPARATIVE INCOME STATEMENTS AND BALANCE SHEET AND
AFOREMENTIONED RATIOS FOR IMMEDIATE PRECEDING 5 YEARS OR FOR THE
PERIOD OF EXISTENCE OF THE COMPANY AS PER AUDITORS REPORT UNDER
SECTION 135(1), PARA 24(1) OF PART II OF SCHEDULE III OF THE ,
1994
415
FINANCIAL SPREAD SHEET ANALYSIS FOR THE LATEST AUDITED FINANCIAL
STATEMENTS 420
EARNINGS PER SHARE (EPS) ON FULLY DILUTED BASIS (WITH THE TOTAL
EXISTING NUMBER OF SHARES) IN ADDITION TO THE WEIGHTED AVERAGE
NUMBER OF SHARES BASIS
422
THE INFORMATION REGARDING ALL EXTRA-ORDINARY INCOME OR
NON-RECURRING INCOME COMING FROM OTHER THAN CORE OPERATIONS SHOULD
BE SHOWN SEPARATELY WHILE SHOWING THE NET PROFIT AS WELL AS THE
EARNINGS PER SHARE INCLUDED
422
QUARTERLY OR HALF YEARLY EPS SHOULD NOT BE ANNUALIZED WHILE
CALCULATING THE EPS FOR THE PURPOSE OF PRESENTING IN THE
RED-HERRING PROSPECTUS /PROSPECTUS/ INFORMATION MEMORANDUM
422
NET ASSET VALUE (WITH AND WITHOUT CONSIDERING REVALUATION
SURPLUS/RESERVE) PER UNIT OF THE SECURITIES BEING OFFERED AT THE
DATE OF THE LATEST AUDITED STATEMENT OF FINANCIAL POSITIOn
422
STATEMENTS FOR THE LAST FIVE YEARS OR ANY SHORTER PERIOD OF
COMMERCIAL OPERATION CERTIFIED BY THE AUDITORS:-
424
STATEMENT OF LONG TERM AND SHORT TERM BORROWINGS INCLUDING
BORROWING FROM RELATED PARTY OR CONNECTED PERSONS WITH RATE OF
INTEREST AND INTEREST PAID/ACCRUED
424
STATEMENT OF PRINCIPAL TERMS OF SECURED LOANS AND ASSETS ON
WHICH CHARGE HAVE BEEN CREATED AGAINST THOSE LOANS WITH NAMES OF
LENDERS, PURPOSE, SANCTIONED AMOUNT, RATE OF INTEREST, PRIMARY
SECURITY, COLLATERAL/OTHER SECURITY, RE-PAYMENT SCHEDULE AND
STATUS
427
STATEMENT OF UNSECURED LOANS WITH TERMS & CONDITIONS 434
STATEMENT OF INVENTORIES SHOWING AMOUNT OF RAW MATERIAL, PACKING
MATERIAL, STOCK-IN-PROCESS AND FINISHED GOODS, CONSUMABLE ITEMS,
STORE & SPARES PARTS, INVENTORY OF TRADING GOODS ETC.
435
STATEMENT OF TRADE RECEIVABLES SHOWING RECEIVABLE FROM RELATED
PARTY AND CONNECTED PERSONS 436
STATEMENT OF ANY LOAN GIVEN BY THE ISSUER INCLUDING LOANS TO
RELATED PARTY OR CONNECTED PERSONS WITH RATE OF INTEREST AND
INTEREST REALIZED/ACCRUED
437
STATEMENT OF OTHER INCOME SHOWING INTEREST INCOME, DIVIDEND
INCOME, DISCOUNT RECEIVED, OTHER NON OPERATING INCOME
440
STATEMENT OF TURNOVER SHOWING SEPARATELY IN CASH AND THROUGH
BANKING CHANNEL 441
STATEMENT OF RELATED PARTY TRANSACTION 442
RECONCILIATION OF BUSINESS INCOME SHOWN IN TAX RETURN WITH NET
INCOME SHOWN IN AUDITED FINANCIAL STATEMENTS
449
CONFIRMATION THAT ALL RECEIPTS AND PAYMENTS OF THE ISSUER ABOVE
TK.5,00,000/- (FIVE LAC) WERE MADE THROUGH BANKING CHANNEL
449
CONFIRMATION THAT BANK STATEMENTS OF THE ISSUER ARE IN
CONFORMITY WITH ITS BOOKS OF ACCOUNTS; 449
STATEMENT OF PAYMENT STATUS OF TAX, VAT AND OTHER TAXES/DUTIES
450
AUDITORS DISCLOSURE 451
MANAGEMENT DISCLOSURE 470
CREDIT RATING REPORT 479
PUBLIC ISSUE APPLICATION PROCEDURE INCLUDED 506
UN-AUDITED FINANCIAL STATEMETN FOR THE PERIOD ENDED MARCH 31,
2020 511
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EXECUTIVE SUMMERY SECTION I (a) ABOUT THE INDUSTRY Historically,
power generation in Bangladesh heavily dependent on natural gas
from local extraction. Moreover import of capital machineries and
subsidized petroleum negatively impact on the foreign exchange.
Power and Energy Sector Development Roadmap (2010-2021) target to
produce 20,000 MW by 2021. However, to ensure overall and balanced
development of this sector, the GOB has undertaken various plans
including balanced development in generation, transmission and the
distribution system to achieve a desired level of reliability of
supply towards reaching the per capita consumption to 600 Kw. The
above scenario suggests growth potential for EPGL in the segment of
power equipment and boiler trading business of the company. Data
Sources: http://www.bpdb.gov.bd
Present Installed Generation Capacity (MW) as on June 2019
Public Sector Installed Capacity Private Sector Installed
Capacity
BPDB 5,498 IPP/SIPP 6,503
APSCL 1,444 (REB) 251
EGCB 839 Rental 1,540
NWPGCL 1,395 Power Import 1,160
RPCL 182 Subtotal 9,454 (49.86%)
BPDB-RPCL JV 149
Subtotal 9,507 (50.14%)
Total Generation Capacity as on June, 2019=18,961
* Including Captive Power Total Installed Capacity (13,561 +
2,200) = 15,761 MW Automotive industry in Bangladesh is largely
dominated by importing reconditioned and new vehicles mostly from
Asian countries like Japan, China, India and few from Europe and
USA. However, different private endeavor grabs distributorship of
different vehicle brands. From the statistics it is identified that
the country has around 20 companies that sell around 10,000 unit
buses and commercial Vehicles a year, and the market is growing by
10-15 percent annually. Data Sources:
https://www.export.gov/article?id=Bangladesh-Power-and-energy A
rapid growth of the consumption of Liquefied Petroleum Gas (LPG) in
Bangladesh has been observed over the last few years as households,
commercial entities and vehicles being the major drivers. In 2015,
LPG consumption in Bangladesh was only 250,000 metric ton (MT)
which reached at 800,000 MT in 2019. Bangladesh’s existing LPG
demand is estimated at around 2 million MT per year, with half of
it is currently being met by kerosene and wood due to deficiency of
LPG. The natural gas reserves of Bangladesh is 11.47 trillion cubic
feet (TCF) as of January 2019, which can roughly meet the demand
till 2025. With 23 operational gas fields, the country produces
about 2,700 million cubic feet gas per day (mmcfd) against a steady
demand of 3,700 mmcfd, leaving a shortage of 1,000 mmcfd as of
2018. Data Sources: Power Division of Government of Bangladesh,
Japan International Cooperation Agency and Petrobangla According to
World LPG Association (WLPGA), Bangladesh is going to be one of the
fastest-growing LPG market across the world and estimated demand
for the fuel might reach up to 3.0 million MT by 2025. Since the
industry is largely import dominated and 98% of the bulk demand is
imported, the import forecast can give an impression about the
growth of the LPG market in the coming years.
Year Projected LPG import (in million MT)
2020 1.20
2021 1.40
2022 1.65
2023 1.80
2024 2.25
2025 2.70
Data Sources:
https://databd.co/profiles/industries/profile-lp-gas
http://www.bpdb.gov.bd/https://www.export.gov/article?id=Bangladesh-Power-and-energy
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(b) ABOUT THE ISSUER Energypac Power Generation Ltd. (EPGL) was
incorporated as private limited company on July 15, 1995 vide
registration number C-28822 (103)/95 under the Companies Act 1994.
Subsequently, the company converted to a public limited company on
December 27, 2011. Energypac has become one of the leading Power
Engineering Companies in Bangladesh. In its continuous effort for
comprehensive solution EPGL receive ISO 9001:2008 certifications.
The date of commercial operation is July 15, 1995. EPGL has its
registered office at 79, Shahid Tajuddin Ahmed Sharani, Tejgaon
I/A, Dhaka 1208. The corporate office of the company situated at
Energy Center, 25 Tejgaon I/A, Tejgaon, Dhaka- 1208. Also the
Company has several establishment across the country for
uninterrupted smooth operation. The Company is engaged as major
supplier of base load and standby gas and diesel generators and
provides rent, solar panel, accessories and turnkey solutions,
independent power plant, operation and maintenance of power plant,
transmission and distribution, CNG refueling station and conversion
kits, importing and marketing JAC automobiles, machinery and
materials, spare parts, installation and service in Bangladesh and
overseas. EPGL has achieved a new milestone this year in its
business arena by adding Steelpac brand to provide designing,
manufacturing and erecting of pre-engineered steel buildings,
aiming to provide complete steel constructions to industrial,
commercial and residential steel buildings. In addition of that,
EPGL has successfully entered in LPG market branding as G-GAS. The
LPG bottling & distribution plant is located near Mongla sea
port. SUBSIDIARY COMPANY 1. Energypac Power Venture Limited is a
Subsidiary Company which has set up a power plant at Hobigonj of 11
MW
production capacity located in Sylhet, Bangladesh. The company
has a 15 year power purchase agreement with Rural Electrification
Board (REB), Bangladesh. The project started commencement in
January, 2009.
2. EPV Chittagong Limited is another power venture which has a
power plant at Chittagong of 108 MW production
capacity as an Independent Power Producer (IPP). The company has
a 15 year power purchase agreement with Bangladesh Power
Development Board (BPDB). The project started commencement in
January, 2015.
3. EPV Thakurgaon Limited (sub-subsidiary of EPGL) has a power
plant at Thakurgaon of 115MW production capacity as
an IPP (Independent Power Producer) (Under Construction). The
company has a 15 year power purchase agreement with Bangladesh
Power Development Board (BPDB). The Company will delivere the
entire output of electricity to Bangladesh Power Development Board
(BPDB) as per a power purchase agreement dated upon commercial
operation.
(c) FINANCIAL INFORMATION (CONSOLIDATED)
Particulars 2018-2019 2017-2018 2016-2017 2015-2016
2014-2015
Revenues 14,398,996,009 12,444,362,651 4,545,749,964
3,480,069,130 3,132,949,407
Gross Profit 3,312,621,645 2,472,220,847 1,039,009,582
908,109,603 961,642,802
Net Profit Before Tax 627,458,227 609,094,193 426,344,548
196,861,543 378,070,133
Net Profit after Tax 479,932,737 453,507,602 304,561,180
150,092,873 268,608,842
Total Assets 32,036,586,830 29,969,044,026 21,882,536,181
8,935,560,085 8,610,967,216
Paid-up Capital 1,498,696,500 1,498,696,500 1,498,696,500
1,498,696,500 1,498,696,500
Retained Earnings 2,096,003,177 1,420,304,706 1,190,133,594
976,803,873 954,212,818
No. of Shares 149,869,650 149,869,650 149,869,650 149,869,650
149,869,650
Face Value 10 10 10 10 10
NAV per share 45.15 40.65 37.30 31.71 31.92
Earnings per Share 3.13 2.92 2.03 1.00 1.79
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(d) FEATURES OF THE ISSUE AND ITS OBJECTS
Cut-Off Price BDT 35.00
Public Offering Price BDT 31.00
Number of Shares to be Offered 40,293,566
Total Issue Size BDT 1500,000,000
Issue Manager LankaBangla Investments Limited
Register to the Issue ICB Capital Management Limited
Objectives of the Issue Procurement of LPG Carrier &
Accessories, Import of LPG Cylinders, Procurement of Material for
LPG Cylinders and Loan Repayment
(e) LEGAL AND OTHER INFORMATION
Particular Issue Date
Certificate of Incorporation July 15, 1995
Conversion of Private to Public Limited Company December 27,
2011
Conversion of Denomination of Face Value of Shares December 27,
2011
Date of Commercial Operation July 15, 1995
(f) PROMOTERS’ BACKGROUND When the company was incorporated,
following persons were the subscriber to the memorandum:
SL. Name
1 Mr. Rabiul Alam
2 Mr. Enamul Haque Chowdhury
3 Mr. Humayun Rashid
Mr. Rabiul Alam Mr. Rabiul Alam has graduated in Electrical
Engineering from BUET in 1984. He is a dynamic professional
businessperson with more than 33 years of experience in business.
By dint of his leadership, EPGL achieved a massive expansion– both
vertically and horizontally. A number of companies have been set up
during the process, and all of those are successfully running. He
has successfully completed a number of training from reknowned
international institutions. He received certification on High
Voltage Testing and Insulating Materials from Roorkee University,
India. He also completed a training course on Industrial
Engineering which is organized by Asian Productivity Organization,
Japan. Currently, he is the Chairman of Energypac Power Generation
Limited. He is also the Managing Director of Energypac Agro
Limited, Energypac Sea Food Limited, Energypac Electronics Limited,
Energypac Power Systems Limited and Energypac Infrastructure &
Development Limited. In addition of that, he hold the post of
Director of Energypac Engineering Limited, Tec Advantage Limited,
Energypac Fashion Limited, Energypac Batteries Limited, Sonargaon
Leather & Rexin Cloth Industries Limited and Chartered Life
Insurance Company Limited. Mr. Humayun Rashid Humayun Rashid is the
Managing Director & Chief Executive Officer (CEO) of Energypac
Power Generation Limited. Under the leadership of Mr. Rashid the
company remarked as a power engineering company of Bangladesh. He
earned his Bachelor Degree from University of Dhaka in the year
1982. Also attended training programs on Entrepreneurship,
Leadership, Retail Product Marketing, Occupational Hazard and
Safety both at home and abroad like AOTS- Japan and IIM- India. His
32 Years of experience in Business of Manufacturing and
Distribution of different types of Transformers, Electrical T &
D Products, EPGL established itself as a major Power and Energy
solution provider. He was the Senior Vice President of Dhaka
Chamber of Commerce and Industries. He is the immediate Past
President of France-Bangladesh Chamber of Commerce &
Industries, Current Vice President of International Business Forum
of Bangladesh. He is also member of some renowned social
organization like Army Golf Club, Chittagong Boat Club, Dhaka Boat
Club and Gulshan Club. He is the Past President of Rotary Club of
Dhaka North.
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Mr. Humayun Rashid is also the Founder Director of Energypac
Engineering Limited, Energypac Transformer Limited, Energypac
Fashion Limited, Energypac Electronic Limited, Energypac Agro
Limited, Energypac Infrastructure & Development Limited,
Energypac Batteries Limited, Energypac Sea Food Limited, and EPV
Chittagong Limited. Mr. Enamul Haque Chowdhury Mr. Enamul Haque
Chowdhury, one of the Founder Director of Energypac, has a long
carrier in developing and established diversified business and
project that includes power generation, engineering financial
institutions, garments etc. Over the period he has earned a rich
in-depth understanding on corporate management, financial
management, Human resource management and know how the state of
-the - art technology to operate a large group of companies. He is
Managing Director of Energypac Engineering Limited, one of the
largest private sector company, engaged in manufacturing
international quality electrical substation and power generation
equipment in Bangladesh. He is also associated with agro based
business. He is the Managing Director of Energypac Fashion Limited.
He is also the Director of Energypac Agro Limited, Tec Advantage
Limited, Energypac Transformer Limited, Energypac Infrastructure
& Development Limited, Energypac Batteries Limited, Energypac
Power Systems Limited. Mr. Chowdhury is a valiant freedom fighter.
Academically Mr. Chowdhury maintained a very successful profile.
After completion of his higher secondary studies in Dhaka College,
he got himself admitted in the University of Dhaka in the year
1970. He has completed bachelor and masters' degree in economics
securing admiring results. He is a Senate Member of Dhaka
University from 2009 to till today. (g) CAPITAL STRUCTURE AND
HISTORY OF CAPITAL RAISING
Particulars No. of Ordinary Shares Nominal price Amount
(BDT)
Before IPO:
Authorized Capital 500,000,000 10/- 5,000,000,000
Issued, Subscribed and Paid up capital 149,869,650 10/-
1,498,696,500
Total paid up capital before IPO (A) * 149,869,650 10/-
1,498,696,500
After IPO:
To be issued as IPO (B) 40,293,566 10/- 402,935,660
Paid up capital (Post IPO) (A+B) 190,163,216 10/-
1,901,632,160
*The Company has raised its paid-up capital in following
phases:
Date of Allotment Nominal
Price Issue Price
Number of Shares Issued Amount of
Share Capital (BDT)
In cash Other
than in cash
Bonus Share
10 July 1995: First Allotment (Subscription to the Memorandum
& Articles of Association at the time of Incorporation)
10/- 10/- 60,000 - 600,000
1 July 2001: Second Allotment 10/- 10/- 140,000 - 1,400,000
19 May 2011: Third Allotment 10/- 10/- - 9,500,000
95,000,000
26 August 2012: Fourth Allotment
10/- 10/- - 46,560,000 465,600,000
19 December 2012: Fifth Allotment
10/- 10/- - 59,073,000 590,730,000
1 October 2013: Sixth Allotment 10/- 44/- 27,400,000 -
274,000,000
16 October 2014: Seventh Allotment
10/- 10/- - 7,136,650 71,366,500
Total 1,498,696,500
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(h) SUMMARY OF VALUATION REPORT OF SECURITIES
Sl. No. Valuation Methods Fair Value (BDT)
Method-1(A) Net Asset value (NAV) per share (with Revaluation)
45.15
Method-1(B) Net Asset value (NAV) per share (without
Revaluation) 30.20
Method-2(A) Earning-based value per share (Considering Avg.
Sector P/E) 25.92
Method-2(B) Earning-based value per share (Considering Avg.
Market P/E) 26.99
Method-3 Average Market Price of Similar Stocks Based Valuation
36.86
The detailed valuation workings of the above-mentioned methods
are furnished under the head of “Valuation Report of securities
prepared by the Issue Manager” in this Prospectus. (i) Others
DECLARATION REGARDING ANY MATERIAL CHANGE INCLUDING RAISING OF
PAID-UP CAPITAL AFTER THE DATE OF AUDITED FINANCIAL STATEMENTS AS
INCLUDED IN THE PROSPECTUS This is to declare that, to the best of
our knowledge and belief, there is no material change including
Raising of Paid-Up Capital after the date of Audited Financial
Statements i.e. June 30, 2019 as incorporated in the Prospectus.
For Energypac Power Generation Limited Sd/- Humayun Rashid Managing
Director Date Dhaka October 01, 2020 DECLARATION OF LANKABANGLA
INVESTMENTS LIMITED REGARDING ISSUE MANAGER OR ANY OF ITS CONNECTED
PERSONS HOLDING OF ANY SECURITIES OF ENERGYPAC POWER GENERATION
LIMITED This is to declare that, LankaBangla Investments Limited or
any of its connected persons is no way connected with Energypac
Power Generation Limited or any of its connected person nor does
hold any securities. For LankaBangla Investments Limited Sd/-
Iftekhar Alam Chief Executive Officer Date Dhaka October 01,
2020
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CONDITIONS IMPOSED BY THE COMMISSION SECTION: II DISCLOSURE IN
RESPECT OF ISSUANCE OF SECURITY IN DEMAT FORM: As per provisions of
the Depository Act, 1999 and regulations made thereunder, the
shares of the Company will be issued in dematerialized form only
and for this purpose, Energypac Power Generation Limited will sign
an agreement with the Central Depository Bangladesh Limited (CDBL).
Therefore, all transfers, transmissions, splitting or conversions
will take place on the CDBL system and any further issuance of
shares (including rights and bonus) will also be issued in
dematerialized form only.
CONDITIONS UNDER 2CC OF THE SECURITIES AND EXCHANGE ORDINANCE,
1969 PART-A
1. The Company shall go for Initial Public Offer (IPO) for
40,293,566 ordinary shares, from which 20,146,766 ordinary shares
are reserved for Eligible Investors (EIs) at their own bid price
and quantity on highest to lowest bid basis in a descending order
of individual bid price till exhaustion of the quota for EI
category and remaining 20,146,800 ordinary shares at a 10%
discounted price from the cut-off price i.e Tk. 31.00 per share for
General Public including NRBs totaling Tk. 1,500,000,000 following
the Securities and Exchange Ordinance, 1969, the Bangladesh
Securities and Exchange Commission (Public Issue) Rules, 2015, the
Depository Act 1999 and rules made there under.
2. The abridged version of the prospectus, as approved by the
Commission, shall be published by the issuer in 4 (Four) national
daily newspapers (two in Bangla and two in English), within 02
(two) working days of issuance of this consent letter. The issuer
shall post the full prospectus, vetted by Commission, in the
issuer’s website and shall also put on the websites of the
Commission, stock exchanges, and the issue manager, within 03
(three) working days from the date of issuance of this letter and
shall remain posted till the closure of the subscription list. The
issuer shall submit to the Commission, the stock exchanges and the
issue manager a diskette containing the text of the vetted
prospectus in “MS- Word” format.
3. The company shall submit 40 (Forty) copies of the printed
prospectus to the Commission for official record within 05 (Five)
working days from the date of publication of the abridged version
of the prospectus in the newspaper.
4. The issuer company and the issue manager shall ensure the
transmission of the prospectus and its abridged version for NRBs
through email to the Bangladesh Embassies and Missions abroad
within 05 (Five) working days from the date of publication of the
abridged version of the prospectus in the newspaper. A compliance
report shall be submitted in this respect to the Commission jointly
by the Issuer and the Issue Manager within 02 (Two) working days
from the date of said transmission of the prospectus.
5. The following declaration shall be made by the company in the
prospectus, namely: -
“DECLARATION ABOUT LISTING OF SHARES WITH THE STOCK EXCHANGE
(S):
None of the stock exchange(s), if for any reason, grants listing
within 30 (Thirty) days from the closure of subscription, any
allotment in terms of this prospectus shall be void and the company
shall refund the subscription money within 15 (Fifteen) days from
the date of refusal for listing by the stock exchanges or from the
date of expiry of the said 30 (Thirty) days, as the case may
be.
In case of non-refund of the subscription money within the
aforesaid 15 (Fifteen) days, the Directors of the company, in
addition to the issuer company, shall be collectively and severally
liable for refund of the subscription money, with interest at the
rate of 2% (two percent) above the bank rate, to the subscribers
concerned.
The issue manager, in addition to the Issuer company, shall
ensure due to compliance of the above-mentioned conditions and
shall submit compliance report thereon to the Commission within 07
(Seven) days of the expiry of the aforesaid 15 (Fifteen) days’ time
period allowed for refund of the subscription money.”
6. All applicants shall apply for a minimum lot of 200 shares
worth Taka 6,200/- (Taka six thousand and two hundred only) or its
multiples.
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7. The IPO shall stand canceled in case of under- subscription
in any category above 35%. In such an event, the issuer and issue
manager shall inform the Commission within 2 (two) working days and
release the subscription money within 10 (ten) working days after
receiving verification report from CDBL and the information from
exchanges regarding subscription.
8. 20% of the securities reserved for other general public
excluding NRB shall be reserved for . In case
of under-subscription under any of sub-categories of General
Public category, the unsubscribed portion shall be added to other
sub-category of General Public category. In case of over
subscription in the general public category, the issuer and the
issue manager shall jointly conduct an open lottery.undersubscribed
portion shall be added to other sub-category of the same
category.
9. An applicant cannot submit more than two applications, one in
his/her own name and the other jointly with another person. In
case, an applicant submits more than two applications, all
applications will be treated as invalid and will not be considered
for allotment purpose. In addition, 15% (fifteen) of the
application money will be forfeited by the Commission and the
balance amount will be refunded to the applicant.
10. The applicants who have applied for more than two
applications using the same bank account, their application will
not be considered for the lottery and the Commission will forfeit
15% of their subscription money.
11. Making of any false statement in the application or
supplying of incorrect information therein or suppressing any
relevant information in the application shall make the application
liable to rejection and subject to forfeiture of 25% of the
application money and/or forfeiture of share (unit) before or after
issuance of the same by the issuer. The said forfeited application
money or share (unit) will be deposited in the account of the
Bangladesh Securities and Exchange Commission (BSEC). This is in
addition to any other penalties as may be provided for by the
law.
12. The company shall furnish the list of allottees to the
Commission and the stock exchange(s) simultaneously in which the
shares will be listed, within 24 (Twenty-Four) hours of
allotment.
13. Shares not allotted at the time of according this consent,
but allotted after listing, in favor of sponsors, directors or
shareholders having 10% or more shares, other than alternative
investment funds, through stock dividends, shall be subject to a
lock-in period of 02(two) years from the date of issuance of the
prospectus.
14. If any share of Sponsors/Directors/Promoters is in paper
format, it shall be handed over to securities custodian registered
with the Commission and shall remain held till completion of
lock-in period and the name of the securities custodian shall be
furnished to the Commission jointly by the issuer and issue
manager, along with a confirmation thereof from the custodian,
within one week of listing of the shares with the stock
exchange(s). Or they (shares of Sponsors/ Directors/ Promoters) can
be demated and shall remain in lock-in under CDBL system and issuer
shall submit a dematerialization confirmation report generated by
CDBL and attested by Managing Director of the company along with
the lock-in confirmation to the Commission within one week of
listing of the shares with the stock exchange(s). In respect of
shares other than Sponsors/Directors/Promoters, the issuer will
ensure their lock-in of those shares and submit a statement to this
effect to the Commission.
15. The company shall not declare any dividend/bonus shares
before listing of its capital with any Exchange from the date of
this consent for raising capital.
16. The company shall not engage itself into any
merger/amalgamation or acquisition activities without taking “No
Objection” from the Commission, on the scheme of the said
merger/amalgamation or acquisition, as recommended by the Board of
Directors, before approval by the shareholders in General
Meeting.
17. The trading of Securities in the platform of the exchanges
shall be started within 10(ten) working days of listing
approval.
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Step-1 (Applicant)
PART–B Application Process
1. An applicant for public issue of securities shall submit an
application/buy instruction to the Stockbroker/ Merchant Banker
where the applicant maintains customer account, within the cut-off
date (i.e. the subscription closing date),
which shall be the 25th (twenty-fifth) working day from the date
of publication of an abridged version of the prospectus.
2. The application/buy instruction may be submitted in
prescribed paper or electronic form, which shall contain the
Customer ID, Name, BO Account Number, Number of Securities applied
for, Total Amount and Category of the Applicant. At the same
time:
a) Non-resident Bangladeshi (NRB) and Foreign applicants shall
submit bank drafts (FDD), issued in favor of the Issuer for an
amount equivalent to the application money, with their application
to the concerned Stockbroker/Merchant Banker. A Non-resident
Bangladeshi (NRB) and the Foreign applicant may also submit a
single draft against 02(two) applications made by him/her, i.e. one
in his/her own name and the other jointly with another person. The
draft (FDD) shall be issued by the Bank where the applicant
maintains Foreign Currency account debiting the same account and
provide the customer with a certificate mentioning the FC account
number which has been debited to issue the FDD. The applicant shall
also submit the certificate with their application. No banker shall
issue more than two drafts from any Foreign Currency account for
any public issue. At the same time, the applicant shall make the
service charge available in the respective customer account
maintained with the Stockbroker/Merchant Banker.
b) Eligible investors shall submit an application through the
electronic subscription system of the exchange(s) and deposit the
full amount intended to subscribe by the method as determined by
exchange(s).
Step-2 (Intermediary) 3. The Stockbroker/Merchant Banker shall
maintain a separate bank account only for this purpose namely
“Public
Issue Application Account”. The Stockbroker/Merchant Banker
shall:
a) Post the amount separately in the customer account (other
than NRB and Foreign applicants), and upon the availability of
fund, block the amount equivalent to the application money;
b) Accumulate all the application/buy instructions received up
to the cut-off date, deposit the amount in the “Public Issue
Application Account” maintained with its bank within the first
banking hour of next working day of the cut-off date;
c) Instruct the banker to block the account for an amount
equivalent to the aggregate application money and to issue a
certificate in this regard.
4. Banker of the Stockbroker/Merchant Banker shall block the
account as requested for, issue a certificate confirming the same
and handover it to the respective Stockbroker/Merchant Banker.
5. For Non-resident Bangladeshi (NRB) and Foreign applicants,
the Stockbroker/Merchant Banker shall prepare a list containing the
draft information against the respective applicant’s
particulars.
6. The Stockbroker/Merchant Banker shall prepare category wise
lists of the applicants containing Customer ID,
Name, BO Account Number and Number of Securities applied for,
and within 03 (three) working days from the cut-off date, send to
the respective Exchange, the lists of applicants in electronic
(text format with tilde ‘~’ separator) format, the certificate(s)
issued by its banker, the drafts and certificates received from
Non-resident Bangladeshi (NRB) and foreign applicants and a copy of
the list containing the draft information.
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7. On the next working day, the Exchanges shall provide the
Issuer with the information received from the Stockbroker/ Merchant
Bankers, the drafts and certificates submitted by Non-resident
Bangladeshi (NRB) and Foreign applicants and the list containing
the draft information. Exchanges shall verify and preserve the
bankers’ certificates in their custody.
8. The application/buy instructions shall be preserved by the
Stockbroker/Merchant Bankers up to 6 months from listing of the
securities with the exchange.
Step-3 (Issuer) 9. The Issuer shall prepare a consolidated list
of the applications and send the applicants’ BOIDs in
electronic
(text) format in a CDROM to CDBL for verification. The Issuer
shall post the consolidated list of applicants on its website and
websites of the Exchanges. CDBL shall verify the BOIDs as to
whether the BO accounts of the applicants are active or not.
10. On the next working day, CDBL shall provide the Issuer with
an updated database of the applicants containing BO Account Number,
Name, Addresses, Parent s’ Name, Joint Account and Bank Account
information along with the verification report.
11. After receiving verification report and information from
CDBL, the Issuer shall scrutinize the applications, prepare
category wise consolidated lists of valid and invalid applications
and submit a report of the final status of subscription to the
Commission and the Exchanges within 10 (ten) working days from the
date of receiving information from the Exchanges.
12. The issuer and the issue manager shall conduct category wise
lottery with the valid applications within 03 (thre