GLOSSARY OF TECHNICAL TERMS v

RISK FACTORS AND MANAGEMENT’S PERCEPTION THEREOF vi

GENERAL RISK xiv

HIGHLIGHTS xv

PART I 1

I. GENERAL INFORMATION 1

II. CAPITAL STRUCTURE OF THE COMPANY 13

III. TERMS OF THE PRESENT ISSUE 20

IV. TAX BENEFITS 44

V. PARTICULARS OF THE ISSUE 45

VI. COMPANY INFORMATION AND MANAGEMENT 48

VII. MAIN OBJECTS OF THE COMPANY 55

VIII. PROMOTERS AND THEIR BACKGROUND 55

IX. OTHER VENTURES OF THE PROMOTER 61

X. MANAGEMENT OF THE COMPANY 67

XI. DETAILS OF UTILISATION OF ISSUE PROCEEDS 72

XII. OPERATING ENVIRONMENT AND BUSINESS OUTLOOK 83

XIII. BUSINESS OF THE COMPANY , BUSINESS MODEL AND GROWTH STRATEGY 97

XIV. PAST FINANCIAL HIGHLIGHTS 101

XV. COMPARISON OF PERFORMANCE IN 2000 WITH THAT IN 1999 110

XVI. BASIS OF ISSUE PRICE 115

XVII. STOCK MARKET DATA 116

XVIII. PARTICULARS REGARDING LISTED COMPANIES 118

XIX. DETAILS OF OUTSTANDING LITIGATION, DEFAULT AND MATERIAL DEVELOPMENTS 117

XX. RISK FACTORS AND MANAGEMENT’S PERCEPTION THEREOF 120

PART II 129

A. GENERAL INFORMATION 129

B. FINANCIAL INFORMATION 135

C. STATUTORY AND OTHER INFORMATION 144

D. NOMINATION OF SHARES 149

E. MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION 164

PART III 166

DECLARATION 166

ABBREVIATIONS AND GLOSSARY OF THE TERMS USED
 

Act	:	The Companies Act, 1956
Application Form	:	Means the form in terms of which the investors shall apply for the equity shares of the Company issued in the Fixed Price Portion
Articles	:	The Articles of Association of Nimbus Communications Ltd.
BA	:	Beneficiary Account
Bid	:	Means an indication to make an offer by a prospective investor to subscribe to equity shares of the Company at a designated price, during the Bidding Period and includes all revisions and modifications thereto
Bid Closing Date	:	Means the date after which the Syndicate Members / Brokers to the Offer would not accept any Bids; such date shall be notified and communicated through a notice in an English national newspaper, Hindi national newspaper and a Regional language newspaper with wide circulation.
Bid cum application Form	:	Means the form in terms of which the Bidder shall bid for equity shares of the Company and shall, upon allocation of the equity shares by the BRLM and filing of the Offer Document with the RoC, be considered as the application for the allotment of the equity shares in terms of this Draft Offer Document.
Bid Opening Date	:	Means the date on which the Syndicate Members / Brokers to the Issue would start accepting Bids; such date shall be the date which shall be notified and communicated through a notice in an English National newspaper, Hindi national newspaper and a Regional newspaper with wide circulation.
Bidder	:	Means any prospective investor who makes a Bid in terms of this Draft Offer Document.
Bidding Period	:	Means the period between the Bid Opening Date and the Bid Closing Date inclusive of both days and during the period prospective investors can submit their bids.
Book Built Portion	:	Means the Public Issue less the Fixed Price Portion.
Book Running Lead Manager (BRLM)	:	SBI Capital Markets Limited
Board	:	Board of Directors of Nimbus Communications Ltd.
BSE	:	The Stock Exchange, Mumbai
CDSL	:	Central Depository Services (India) Ltd.
Confirmation of Allocation Note (CAN)	:	Means the note or advice or intimation for allocation of shares sent to the Bidders who have been allocated shares in the Book Built Portion
Co-Book Running Lead Managers	:
DP	:	Depository Participant
Draft Offer Document	:	Means this document which is a preliminary Offer Document and not a Offer Document under section 60 of the Indian Companies Act, 1956.
EPS	:	Earning per Share
ESO	:	Employee Stock Option
ESOS	:	Employees Stock Option Scheme
ISO	:	Initial Stock Option
JSO	:	Joining Stock Option
Escrow Account	:	Means that account opened with the Escrow Collection Bank and in whose favour the Bidder will issue cheques in respect of his Bid and in which account the cheques will be deposited by the Syndicate Members.
Escrow Collection Bank(s)	:	Means the Banks at which the Escrow Account will be opened and which act as such, in terms of this Offer Document and the escrow Agreement.
Final Offer Document/ Offer Document	:	Means the Offer Document filed with the RoC containing inter alia the Issue Price that is determined at the end of the Book Building process, and the number of equity shares to be issued, Issue Price and other incidental information.
Fixed Price Portion	:	Means the portion of the Public Issue as is equivalent to 10% of the Public Issue , which is reserved for individual investors applying for less than or equal to 1000 shares and who have not participated in the Book Built portion and or to those who did not get allocation in the Book Building portion.
FEMA	:	Foreign Exchange Management Act, 1999.
FI	:	Financial Institution
FII	:	Foreign Institutional Investors.
GoI	:	Government of India.
HUF	:	Hindu Undivided Family
IPO	:	Initial Public Offering
Issue Opening Date	:	Means the date on which the Book Built Portion opens for automatic subscription by bidders who have received allocation and have paid at least the Issue/Offer price for their allocation into the Escrow Account. This date shall also mean the date on which the Fixed Price Portion opens for subscription by the public.
Issue Period	:	Means the period between the Issue Opening Date and the Issue Closing Date for Fixed Price Portion and includes both these dates.
Issue Price	:	Means the price determined by the Company in consultation with the BRLM / Joint BLRM on the Pricing Date after the Bidding Period and which shall be set forth in the Final Offer Document to be filed with the RoC at which equity shares of the Company would be allotted.
IT Act	:	Income Tax Act, 1961.
Memorandum	:	Memorandum of Association of Nimbus Communications Limited
MF	:	Mutual Funds
Nimbus/ Company/ Issuer/ NCL	:	Nimbus Communications Ltd.
NCCL	:	Nimbus Creative Corporation Ltd.
NRIs	:	Non Resident Indians
NSDL	:	National Securities Depository Ltd.
NSE	:	National Stock Exchange of India Ltd.
OCB	:	Overseas Corporate Bodies
Offer	:	Public Issue of equity shares by Nimbus Communications Limited
Offer Closing Date for the Book Built Portion	:	Means the date on which the Book Built Portion closes for subscription by the public.
Offer Closing Date for the Fixed Price Portion	:	Means the date on which the Fixed Price Portion closes for subscription by the Public.
Pay – in Period	:	For the Book Built Portion, Pay – in Period means the period commencing on the Bid Opening Date and extending till the Bid Closing Date, during which the bidders have to pay the maximum bid amount into the Escrow Account during the bidding period, unless such requirement is waived by the Syndicate Members. In case of requirement of payment during the bidding period is waived by the syndicate member the closure of pay-in period for such bidders for payment into the escrow account shall be within 3 days of communication of the allocation list to the syndicate member by the BRLM.
Pricing Date	:	Means the date on which the Company in consultation with the BRLM finalises the Issue Price.
Public Issue/Issue/Issue Size	:	Means the issue of new equity shares of Rs.5/- each at the issue price by the Company aggregating Rs.182.25 crores
QIB	:	Qualified Institutional Buyers, QIBs as defined by SEBI are  Public Financial Institution as defined in section 4A of the Companies Act, 1956; Scheduled Commercial Banks; Mutual Funds; Foreign Institutional Investors registered with SEBI; Multilateral and bilateral development financial institutions; Venture Capital funds registered with SEBI.
RBI	:	Reserve Bank of India
Registrars to the Issue		Means Karvy Consultants Limited
Retail Bidders		Means the Bidders who are individuals and who have not bid for higher than 1000 equity shares in any of their bidding options
Revision Form	:	Means the form used by the Bidders to modify the quantity of shares or the Bid price in any of the Bidding Options.
RoC	:	Registrar of Companies, Mumbai
RSE	:	Regional Stock Exchange i.e. The Stock Exchange, Mumbai.
SEBI	:	The Securities and Exchange Board of India
SGD	:	Singapore Dollars
Syndicate	:	Means collectively the BRLM/ Joint BRLM and Syndicate Members.
Syndicate Members	:	Means persons who are appointed by the BRLM as Syndicate Members and are persons who are registered with SEBI as underwriters.
Transaction Registration Slip (TRS) or Order Confirmation Note	:	Means the slip or document registering the Bids, issued by the Syndicate Members/ Brokers to the Offer to the Bidders as proof of registration of the Bid upon the submission of the Bid Form in terms of this Draft Offer Document.
USD	:	United States Dollars
Wholesale Bidders		Means all the Bidders who are not Retail Bidders

 

GLOSSARY OF TECHNICAL TERMS
 

Air Time	The time allotted on a TV channel for airing commercials
B2C	Business to Consumer electronic commerce
B2B	Business to Business electronic commerce
C2C	Consumer to Consumer electronic commerce
Community	A well defined set of individuals using the internet, having comparable behavior and demographics
C&S TV	Cable & Satellite Television, i.e. TV channels distributed through cable and delivered via satellite
Encrypted TV	Television signal that is coded, such that only a paying customer can receive it through a decoder
e-commerce	Electronic Commerce - Business transactions on the internet or any other electronic media
Genre	Nature of the programme, such as comedy, tragedy, thriller etc.
GE	General Entertainment
Internet Content	Formatted information featuring on the web site or Portal
Library	Collection of programs for which the Company has sole rights
Netizen	Equivalent to " Citizen" on the net. Basically an individual who uses the internet regularly
Pay TV	Television channels that charge a subscription fee
Portal	A multi purpose website
Ratings	Syndicated weekly research figures on viewership of television programmes, expressed as a percentage
Share of Audience	The percentage of audience figure that indicates a programme’s or channel’s share of total viewers
Terrestrial TV	Television stations and/or networks which distribute signals through land based transmitters, wireless to home
Television Content	Television programs/ software
TRPs	Television Rating Points, also known as Ratings
Uplinking	The process of sending a television signal from an earth station to a satellite in orbit
Vortal	A vertical Portal, targeting a very specifically defined community on the internet
WAP	Wireless Application Protocol - enables integration of wireless medium with other communication Technologies
Web site	A set of collective and formatted information on the internet, with a unique internet address.

Internal

1. The Company is promoted by first generation entrepreneurs.


Management Perception: Shri Harish Thawani, the main promoter, has over 20 years of experience in the media & entertainment industry. He has been associated with leading advertising agencies such as Lintas and Chaitra Leo Burnett and has experience in the areas of marketing research and communication strategy, prior to incorporation of NCL in the year 1987.

Shri Thawani has received industry level recognition and he is an elected Director on the Board of the Indian Broadcasting Foundation, the chairman of the FICCI sub committee for ‘television content’ and a member/ co-ordinator of the IBF subcommittee for ‘internet’ regulatory recommendations and an elected member of the Radio Group’s Executive Committee.

He is well supported by a qualified and experienced team of top management which includes specialists in the areas of internet content and e-commerce, networking technology, television content, television broadcast, motion picture content, marketing, advertising and finance. (Please refer to para on "Promoters" on page no. 55)

2. One of the ventures promoted by Shri Harish Thawani, M/s Aquarius Transnational, had incurred losses to the tune of Rs.2.95 lacs, Rs.3.33 lacs and Rs.6.87 lacs in FY 1998, FY 1999 and FY 2000 respectively.


Management Perception: The scale of operations in M/s Aquarius Transnational is very small and the promoters’ main focus has been on the growth and management of Nimbus.(Please refer to para on "Other Ventures of the Promoter" on page 61 of the Offer Document)

3. There are certain pending legal proceedings against the Company and the promoters, which are detailed hereunder:

• Dispute between Nimbus & Prasar Bharati consequent upon unilateral revision of minimum guarantee by the latter (in respect of "Superhit Muqabla"), which was beyond the terms of agreement. The Company’s claim of Rs.9.90 crores for loss of future profits and counter claim of Rs. 7.62 crores by Prasar Bharti is pending arbitration. The Company is, in fact, the claimant and had initiated the legal proceedings. Prasar Bharati has then filed a counter claim. In proceedings filed by the Company before the Hon’ble Bombay High Court and the Hon’ble Supreme Court, Prasar Bharati made a plea before the Courts to order the Company to make a deposit to the tune of their counter claim. The Courts did not order any such deposit. Pursuant to the proceedings filed by the Company before the Hon’ble Supreme Court, the Court appointed an Arbitrator. In the arbitration proceedings the Company has provided evidence in support of its claim, including the testimony of its witness. The arbitration proceedings are on.

• Dispute between Nimbus & Navodaya following termination of marketing agreement pertaining to a programme titled "Bible Ki Kahaniyaan" by Navodaya. Nimbus has made a claim of Rs. 19.58 lacs. Navodaya has made a counter claim for Rs. 92.68 lacs. Navodaya failed to refund certain advances paid to it and also failed to perform the agreement to deliver the serial on time, whereupon after repeated reminders the Company filed legal proceedings for recovery. Navodaya has made a counter claim in the same proceedings. The pleadings in the matter are complete and evidence is expected to be recorded.

• Dispute between Shishir Gupta Productions Pvt. Ltd. against Nimbus, following discontinuation of telecast of a serial by the name of "Manorama Cabin" for which Nimbus was appointed as a Marketing agency. Nimbus sought to adjust Rs.19.80 lacs due to Shishir Gupta Productions against monies due to Nimbus towards value of unutilised free commercial time.The Arbitral Tribunal published the award and an amount of Rs.20.40 lacs is payable by Nimbus and interest on Rs. 12,76,000/- @ 24% from due dates mentioned in the contract . In the meantime, Nimbus has filed a petition under Section 34 of Arbitration and Conciliation Act 1996 to set aside the Award. The petition had come up for admission, but will now to be heard by the Calcutta High Court owing to the Respondent moving the Calcutta High Court in 1997, for instant reliefs. In view of this, the Company has obtained orders from the Bombay High Court returning the Petition for presentation before the appropriate Court.

• Suit filed by Saeed Naqvi against Shri Harish Thawani & Nimbus alleging breach of contract and claiming damages of Rs.2 lacs and interest thereon . The case is pending before Delhi High Court. The Court has directed the defendants to pay Rs. 45,000/- to the plaintiff without prejudice to the contents of the defendants, which amount has been paid.

• Suit filed by M/s Sa Sa Creations against Nimbus for recovery of dues towards unpaid bills, which is being contested by Nimbus on the grounds of failure to fulfil contractual obligations. The amount claimed is to the tune of Rs. 11.29 lacs. M/s Sa Sa Creations, had already signed a full and final settlement of dues statement, regarding the commercial agreement that it had with the Company and has subsequently filed the above suit. NCL has filed an application for stay of the suit in view of an Arbitration clause and sought a direction to the Plaintiffs to submit to Arbitration.

• Dispute between M/s B& B Video, M/s Entertainment Network and Nimbus relating to the serial "Mrignayani". Nimbus had claimed repayment of Rs.11.2 lacs paid by it towards production costs to M/s B & B Video on behalf of Entertainment Network. Entertainment Network has claimed that the said amount of Rs.11.2 lacs was actually payable to it and that Nimbus owed a further Rs.6.4 lacs to M/s B & B Video. This is an inter se dispute between M/s B & B Video and M/s Entertainment Network, since the Company was the air time marketing agency for the serial in question, the Company has also been made a party to this matter. The Company has, however, a signed agreement with M/s Entertainment Network that all dues payable by the Company under its commercial agreement have been paid. The Written Statement in defence has been filed and the suit is expected to be listed for trial in the year 2001.

• Dispute between Nimbus Communication Ltd. v/s M/s. Vinod Pande Entertainment Organisation(VPEO) relating to serial "Reporter". The above application was filed against the Order of the City Civil Court which permitted Chaitra Leo Burnett (CLB)to be added as party to a suit filed by Nimbus against Vinod Pande Entertainment Organisation in relation to the serial "Reporter". The said Civil Revision Application has been admitted but is of no consequence, since Nimbus has no interest in the serial "Reporter’ after the 26^th Episode.

• Dispute between Nimbus Communications and Multichannel India Ltd., whereby a petition has been filed claiming that Nimbus owes Multichannel a sum of Rs.1.19 crores. The said dispute is on account of an Agreement of Financial Participation between Nimbus and Multi Channel India Limited. Nimbus has disputed the claim in its reply to the statutory notice served by Multi Channel. The petition filed by Multi Channel has not yet come up for admission.

1. There are outstanding income tax liabilities against Nimbus Creative Corporation (NCCL), a group company, for an aggregate sum of Rs.58.97 lacs, which is pending rectification. M/s Aquarius Transnational, which is another venture of the Promoters, has an outstanding amount of Rs.1.26 lacs towards income tax liability, the appeal in respect of which is pending before the Appellate Tribunal.


Management Perception: NCCL had made an application for disputed liability aggregating Rs.51.39 lacs to the Settlement Commission, which has been admitted by them. Consequently, the demand stands stayed as on date and the case will be heard by the Settlement Commission in due course of time. (Please refer to para under "Defaults" on page 117 of the Offer Document)

2. Other than the liabilities that may arise out of the pending disputes (as stated under Risk Factor 3 and 4), the Company had contingent liabilities aggregating Rs.357.63 lacs, as on 30^th September, 2000, as detailed hereunder:

	(Rs. in lacs)
Claims made by Doordarshan not acknowledged as debt	222.36
Bank guarantee given by the Company to Doordarshan	135.27
TOTAL	357.63

Management Perception: The claim of Rs.222.36 lacs pertains to a dispute relating to use of advertising time by a third party in respect of two products. The Company has furnished a proof in respect of one of the products, which has been verified and accepted by Doordarshan. The Company has provided Off Air recording as a proof in respect of the same, which is being examined by Doordarshan. The bank guarantee of Rs.135.27 lacs is on account of normal business activities of the Company.

3. The project cost has not been appraised/ assessed by any Bank or Financial Institution and hence funds utilisation is at the discretion of the management.


Management Perception: The fund requirements have been estimated based on the Business Plans drawn up by the Company. (Please refer to para on "Particulars of the Issue" on Page 45 of the Offer Document). The Company has been in the media and entertainment sector since 1987 and with its in house budgetary and internal controls, checks and balances, it expects to implement the plans as per schedule.

4. Delays in identifying and/or implementing projects in the areas of airtime marketing, motion pictures and internet content and e-commerce (through investment in subsidiary company Nimbus Online Pvt. Ltd) could have an adverse impact on the Company’s profitability.


Management Perception: The Company has already identified projects and commenced negotiations for new projects in airtime marketing. The Company has a presence in this segment for over a decade and does not envisage any difficulty in implementation of its expansion in airtime marketing. In motion pictures, it has commissioned writers and directors for its projects and the projects are underway. A programme of continuous project development has already been started by the Company for future projects. The schedule of launch of internet content and e-commerce sites is on time and the community portal has already been launched. Effective MIS systems and Business processes are the Company’s key focus areas. The Company, therefore, does not anticipate any delay in identification and implementation of these projects. (Please refer to para on "Details of utilisation of issue proceeds" on page 72 of the Offer Document)

5. The revised cost of the internet content and e-commerce project , being set up by Nimbus Online Pvt. Ltd., has not been appraised by any Bank or Financial Institution. .


Management Perception : The project had been originally appraised by IDBI. However the scope of the project has changed since then leading to revised cost figures. The Company will be obtaining the necessary approval from IDBI at the appropriate time.

6. The Company proposes to raise Rs.9.87 crores for sports event management, production, telecast and marketing. The Company has no firm tie-ups for any specific sports events in respect of the same.


Management Perception: The Company has several options and offers available to it for sports events such as ATP Tennis Tour, the 2002 World Cup of Football, Asian Games 2002. The Company is in the process of firming up its options. Further, the Company has signed an agreement on 17^th January ,2000 with World Sport Group to form a Joint Venture Company (JVC) with 50% holding each to produce live sports coverage/production and/or distribution for television in India and cricket production and/or distribution and/or sponsorship in all parts of the world. The initial business of the JVC will be managing the operations, production, sales, distribution etc. of all events comprised in the 8-year contract awarded by ICC to World Sport Group in association with Nimbus for the ICC Cricket Contract for the years 2000-2007. The World Sport Group and Nimbus 50:50 JVC is now formally incorporated in Singapore in the name of WSG Nimbus Pte Ltd. which will exclusively manage the ICC business as well as operate all international sports events in South Asia and Cricket worldwide. Also, WSG NIMBUS Pte. Ltd. has been awarded a three year contract(dated 3^rd December, 2000) by the Board of Control for Cricket in Sri Lanka for the identified fourteen cricket tours played in Sri Lanka from 20001-2003. WSG NIMBUS Pte. Ltd. will have all commercial rights for all the cricket matches including the Broadcast Rights, Signage and Advertising Rights, Sponsorship Rights, Film Rights, Merchandising Rights, Video Rights and Other Rights.

7. The Company is yet to firm up orders for studio equipment for expansion of Television Content aggregating Rs.3.46 crores.


Management Perception: The Company has already identified the equipments and these are easily available in the domestic market.

8. The Company proposes to set up 2 satellite delivered cable distributed television channels for which regulatory clearance have not been obtained. Further, the Company is yet to make arrangements for uplinking and distribution for these channels.


Management Perception: The Company has finalised an agreement with Thaicomsat on October 11, 2000, for utilisation of satellite platforms. As per the present policy of uplinking of signals from India, any company having not less than 80% of Indian shareholding is eligible to apply for an NOC. The Company has, vide its Board resolution dated the 10^th January 2000, placed a restriction on foreign holdings to a maximum of 20% of the share capital. The Company is, therefore eligible to apply for the required NOC. The Company would be applying for the same in due course, after selection of the ideal satellite platform, and would be subject to any regulation, which will be applicable. The Company has entered into an Agreement of Intent with Modi Entertainment Network for distribution of the channel, subject to entering into a formal agreement. The said agreement is valid till the 31^st December, 2000.

9. The Company is yet to place orders for the equipment required for web solutions development.


Management Perception: The Company has already identified the equipments and these are easily available in the domestic market.

10. The Company is yet to acquire land and building for the expanded infrastructure.


Management Perception: The Company has acquired a building for its Television broadcasting activities and is completing the due diligence before entering into an agreement for further acquisition of land and building and expects to complete all the formalities shortly.

11. The business plan envisages an estimated loss of Rs. 7.87 crores in the first year i.e. 2000-2001 in television broadcasting, an estimated loss of Rs.3.23 crores in the first year i.e. 2001-2002 in FM radio operations, which is proposed to be funded through the Public Issue


Management Perception: Though the Company's business plan envisages an operational deficit in the above areas, the Company, as a whole, expects to generate post-tax profits for the said year.

12. The Company intends to get into the FM Radio business and has received a Letter of intent for the same from the Ministry of Information & Broadcasting. However, the Company is yet to furnish the required bank guarantee to the Ministry of Information & Broadcasting as required under the Letter of Intent, for which the last date has expired.

Management Perception: Since there is a substantial difference between the terms as laid in the original FM Tender Document and the subsequent License Agreement for FM Radio forwarded by Ministry Of Information & Broadcasting, some of the successful bidders(including the Company) have objected to this with the Ministry Of Information & Broadcasting and have not submitted the bank guarantee. A few of the successful bidders(not including the Company) have filed a writ petition in the Delhi High Court. The Company has also made a representation to the Ministry Of Information & Broadcasting requesting the Ministry to revert to the original terms and conditions of the Tender Document. If the matter with the Ministry of Information & Broadcasting is not resolved, the amount of Rs. 13.89 crores intended to be invested in FM Radio business will be used for the following activities - Media Marketing & Acquisitions, Television Content, Ad-films & Events and Joint Ventures & Acquisitions.

External

1. Changes in the Government policies/regulations resulting in changes in the economic environment may affect the financials of the Company.


Management Perception: The Government’s attitude towards the media and entertainment sector has been a pro-active and encouraging one as can be seen from the various measures taken in the recent past : according of ‘industry’ status to the motion picture sector, policy to accord licences for private sector FM Radio stations, removal of excise duty on recorded tapes for television content and broadcast, introduction of clarity through Section 80HHF of the Income Tax Act by which export income from entertainment software is tax exempt, allowing uplinking to 80% Indian owned television channels etc.

2. Competition from currently established companies and future entrants into the Industry. Management Perception: The Company has been able to retain its edge over competitors due to its multi channel, multi lingual, multi genre and multi time band approach to airtime sales. The Company is getting into new areas such as TV broadcasting, FM radio and internet content and e-commerce (through its investment in Nimbus Online Pvt. Ltd.). The presence across multiple media platforms would give the Company a competitive advantage in providing cross-media packages to advertisers thereby allowing a much larger and wider reach as well as creating multiple content plays across media platforms.
3. The current valuation in the media industry may not be reflective of the future valuations for the Industry.


Management Perception: This is a general risk attached to any high growth industry.

4. The expansion and diversification plans drawn by the Company are based on expected business opportunities in these fields. Any change in the market conditions could adversely affect the profitability of the Company.


Management Perception: Established in the year 1987, the Company was one of the early entrants in this industry. The Company has successfully operated in the television content and air time marketing sectors and has recorded a turnover of Rs.100.11 crores for the year ended 31^st March, 2000.The Company has had experience in airtime marketing and has been identifying opportunities early on.

5. Low availability of skilled manpower in this field and high attrition rate among employees.


Management Perception: The Company has trained personnel in this line of business. The Company lays emphasis on training and skill upgradation through regular "in-house" training programmes for new entrants. Further, the Company has recently introduced an ESOP and believes that it would be able to retain the best talent in the industry and reduce the rate of employee turnover.

6. The industry is prone to risk of obsolescence with respect to content formats and genres.


Management Perception: The Nimbus Group has, in the past, been responsive to the changing environment and viewers' preferences. The Company was one of the earliest to use the concept of dubbed animated cartoon series on Indian Television through its marketing of "Jungle Book". The Nimbus Group popularised the concept of music countdown shows through one its productions, "Superhit Muqabla", which was well received by television viewers and also has introduced other novel concepts such as prime time daily soaps viz. "Shakti" in some of the south Indian language television channels. It is borne out from the above that the Company is in a position to cater to the changing preferences/ tastes in respect of television content.

7. There are forward looking statements in the Offer Document, which reflect the current expectations of the Company on the Industry, financials and other plans of the Company. These are subject to number of risks and uncertainties and are also based on certain assumptions made by the Company.

• Out of the equity capital of Rs.18.09 crores shares aggregating Rs.5.99 crores have been issued as bonus shares. Out of the same, shares aggregating Rs.3.99 crores were issued in FY 1994-95 as bonus shares out of revaluation reserves and shares aggregating Rs.2 crores were issued in FY 1997-98 as bonus shares out of general reserves.
• The Company has split the equity shares into shares of face value of Rs.5/- each, vide a resolution passed by the shareholders in the Extra-Ordinary General Meeting held on the 9^th August 2000.
• There are no transactions by the Promoters in the equity shares of the Company during June 2000 to December 15^th , 2000. Details of the same are given on Page 16 of the Draft Offer Document.

• Cost per share to the promoters is Rs. 0.016 and book value per share as on 31^st March 2000 is Rs.14.46 for an equity share each of Rs. 10/- face value. ( Cost per share to the promoter is Rs. 0.008 and book value per share as on 31^st March, 2000 is Rs. 7.23 for an equity share each of Rs. 5/- face value.)
• The Company has, with effect from the 30^th September 1999, purchased the assets and business of Nimbus Creative Corporation Limited (NCCL) and allotted 1,20,00,000 equity shares of Rs.10/- each to NCCL at par as a consideration for this transfer. The Promoters of NCL are the promoters of NCCL as well. The financials of NCCL are disclosed on Page No. 62 of the Draft Offer Document

• Apart from the above shares held by NCCL in the Issuer Company, none of the ventures have any business interests/other interests in the Issuer Company.

• NCL revalued its office premises in the year 1994-95. The resultant increase in value of Rs.2.04 crores was transferred to revaluation reserves. During 1994-95, the Company revalued its programming assets at a value of Rs.3,76,19,000/- and the year-wise revenue generated from these programmes are as under:

1. Applicants are advised to refer to the paragraph on the "Basis of Issue Price" mentioned in the Offer Document before making an investment decision in respect of the Offer.
2. Applicants are also advised to refer to the Notes to Accounts appearing later in the Offer Document before making an investment decision in respect of the Offer.

Investors may please note that in the event of oversubscription of the fixed price portion of the issue, allotment/allocation shall be made on proportionate basis in consultation with the Regional Stock Exchange namely The Stock Exchange, Mumbai, as per the details appearing later in the Offer Document.

GENERAL RISK

Investment in equity and equity related securities involve 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 offering. For taking an investment decision investors must rely on their own examination of the issuer and the Issue including the risk involved. The securities have not been recommended or approved by Securities and Exchange Board of India nor does Securities and Exchange Board of India guarantee the accuracy or adequacy of this Offer Document.
 
 
 
 

HIGHLIGHTS

1. One of the early entrants in the industry, established in the year 1987, with multi channel, multi lingual, multi genre and multi time band products in its portfolio.
2. Experienced in production and marketing of television content across various genres, which include music countdown shows, soap operas, sports shows and events, cartoon serials, comedies, regional language serials, daily soap operas, film formatted shows etc.
3. The only Company in India to have twice secured exclusive rights to market the entire air time for the Cricket World Cup, in 1992 and in 1999. The only Company in India to have twice won rights to market the entire airtime for the telecasts of the Central Budget as well as the Election Specials. (Source: Company Research- Please refer to Page No. 49 of the draft Offer Document)
4. The Company has formed a Joint Venture Company with World Sport Group Limited, with 50% equity holding each for live sports coverage/production and /or distribution for television in India and cricket production and/or distribution and/or sponsorship in all parts of the world. The World Sport Group and Nimbus 50:50 JVC is now formally incorporated in Singapore, in the name of WSG Nimbus Pte. Ltd, which will exclusively manage the ICC business as well as operate all international sports events in South Asia and Cricket worldwide. The initial business of the Joint Venture Company will be managing the operations, production, sales, distribution etc. of all events comprised in the 8 year contract awarded by ICC to the World Sport Group Limited led bid in association with Nimbus for the ICC Cricket contract which will exclusively manage the ICC business from years 2000 to 2007. (Please refer to Page no. 75 of the Offer Document)
5. WSG NIMBUS Pte. Ltd. ( a JV between the World Sport Group and Nimbus Communications Limited) has been awarded a three year contract by the Board of Control for Cricket in Sri Lanka for the identified fourteen cricket tours played in Sri Lanka from 20001-2003. WSG NIMBUS Pte. Ltd. will have all commercial rights for all the cricket matches including the Broadcast Rights, Signage and Advertising Rights, Sponsorship Rights, Film Rights, Merchandising Rights, Video Rights and Other Rights. (Please refer to Page no. 75 of the Offer Document)
6. The Company has entered into an agreement with Doordarshan for supply of six and half hours of daily Business News and Features programming adding to 1690 hours, initially for a period of one year renewable by mutual agreement for another one year.(Please refer to Page. No. 75 of the draft Offer Document)
7. A programme library of 3678 hours consisting of varied portfolio as on 15^th August, 2000.(Please refer to Page. No. 54 of the draft Offer Document)
8. Board of Directors comprising professionals from the media and entertainment industry. (Refer Page No. 67 of the draft Offer Document).
9. Strategic forays into television broadcasting, internet content and e-commerce (through investment in its subsidiary, Nimbus Online Private Limited), FM radio broadcasting with a view to establish presence and utilise content across multiple media platforms. The business model is aimed at achieving synergies of integration through convergence.

1. GENERAL INFORMATION

Nimbus Communications Ltd.

(Incorporated on June 30, 1987, as a private limited company in the name of Nimbus Communications Private Limited, converted into a deemed public limited company on July 1, 1994 and a public company on January 4, 2000 in the present name under the Companies Act, 1956)

Registered Office:

101B Vidyanand

107, St. Theresa Road

Bandra (West)

Mumbai- 400 050

Tel.: (022) 600 2403

Fax: (022) 600 2405

e-mail: nimbus@nimbus.co.in

Issue of ……….Equity Shares of Rs. 5/-each for cash at a premium of Rs. X per share (i.e. at a price of Rs. X per share) aggregating Rs. 182.25 crores, out of which 2,00,000 equity shares have been reserved for allotment to employees on a competitive basis.

This Offer includes a Book Building Portion of ……….Equity Shares aggregating Rs…. crores (90%) and a Fixed Price Offer of …………Equity Shares aggregating Rs…. crores(10%).

Authority for the Present Issue

The Present Issue of Equity Shares is made pursuant to the resolution of the Board of Directors of the Company passed at its meeting held on January 10, 2000. In terms of Section 81(1A) of the Act, the present Issue of Equity Shares is being made pursuant to the special resolution passed at the Extraordinary General Meeting of Nimbus Communications Ltd. held on January 4, 2000. The present issue is made pursuant to the resolution passed at the 12^th Annual General Meeting held on December 6, 2000.

Government Approvals

The activities for which the funds are being raised through this Public Issue are within the purview of the objects clause of the Company’s Memorandum of Association. The approvals/clearances that are required to be taken by the Company are as under:-

Television Broadcasting: The Company proposes to set up 2 satellite delivered and cable distributed television channels, which would require uplinking from India. As per the present policy of uplinking of signals from India, any company having not less than 80% of Indian shareholding is eligible to apply for an NOC. The Company has, vide its Board resolution dated the 10^th January 2000, placed a restriction on foreign holdings upto a maximum of 20% of the paid-up share capital. The Company is, therefore, eligible to apply for the required NOC.

The following approvals are needed for entering the Television Broadcasting Business

1. An Application has to be filed with the Ministry of Information & Broadcasting for a No Objection Certificate (NOC) for the Television Broadcasting.
2. Based on the NOC, approval and license would have to be obtained from the Wireless Planning Adviser (WPA) in the Department of Telecommunications, subject to prescribed terms and conditions, and payment of license fee and royalty etc.
3. Clearance needs to be obtained from Standing Advisory Committee for Frequency Assignment(SACFA) of the Ministry of Communications, and from the Department of Space as per the SATCOM Policy, if Nimbus seeks to site a transponder.

FM Radio: FM Radio Broadcast licenses are issued by the Ministry of Information and Broadcasting. The Company participated in the auction and has qualified for award of licenses in New Delhi, Mumbai and Chennai.

The following approvals are needed for entering the FM Radio Business

1. Based on the bidding by applicants and subsequent action by the Ministry of Information and Broadcasting, license is granted by the Ministry for FM Broadcasting.
2. SACFA and WPC clearance will have to be obtained within the specified time period mentioned in the Tender Document, upon issuing of the Letter of Intent by the Ministry of Information & Broadcasting.
3. Bank Guarantee has to be furnished for the specified amounts within 75 days of the date of the Letter of Intent.

The Company intends to get into the FM Radio business and has received a Letter of intent for the same from the Ministry of Information & Broadcasting. However, the Company is yet to furnish the required bank guarantee to the Ministry of Information & Broadcasting as required under the Letter of Intent, for which the last date has expired. Since there is a substantial difference between the terms as laid in the original FM Tender Document and the subsequent License Agreement for FM Radio forwarded by Ministry Of Information & Broadcasting, some of the successful bidders(including the Company) have objected to this with the Ministry Of Information & Broadcasting and have not submitted the bank guarantee. A few of the successful bidders(not including the Company) have filed a writ petition in the Delhi High Court. The Company has also made a representation to the Ministry Of Information & Broadcasting requesting the Ministry to revert to the original terms and conditions of the Tender Document. If the matter with the Ministry of Information & Broadcasting is not resolved, the amount of Rs. 13.89 crores intended to be invested in FM Radio business, will be used for the following activities - Media Marketing & Acquisitions, Television Content, Ad-films & Events and Joint Ventures & Acquisitions.

DISCLAIMER CLAUSE

IT IS TO BE DISTINCTLY UNDERSTOOD THAT THE SUBMISSION OF THE OFFER DOCUMENT TO SEBI SHOULD NOT, IN ANY WAY BE DEEMED OR CONSTRUED THAT THE SAME HAS BEEN CLEARED OR APPROVED BY SEBI. SEBI DOES NOT TAKE ANY RESPONSIBILITY, EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR THE PROJECT FOR WHICH THE OFFER IS PROPOSED TO BE MADE, OR FOR THE CORRECTNESS OF THE STATEMENTS MADE OR OPINIONS EXPRESSED IN THE OFFER DOCUMENT. THE BOOK RUNNING LEAD MANAGER, SBI CAPITAL MARKETS LIMITED, HAS CERTIFIED THAT THE DISCLOSURES MADE IN THE OFFER DOCUMENT ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH THE SEBI (DISCLOSURES AND INVESTOR PROTECTION) GUIDELINES IN FORCE FOR THE TIME BEING. THIS REQUIREMENT IS TO FACILITATE THE INVESTORS TO TAKE AN INFORMED DECISION FOR MAKING AN INVESTMENT IN THE PROPOSED OFFER.

IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE ISSUER IS PRIMARILY RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT INFORMATION IN THE OFFER DOCUMENT, THE BOOK RUNNING LEAD MANAGER IS EXPECTED TO EXERCISE DUE DILIGENCE TO ENSURE THAT THE ISSUER AND OFFERORS DISCHARGE THEIR RESPONSIBILITY ADEQUATELY IN THIS BEHALF AND TOWARDS THIS PURPOSE, THE BOOK RUNNING LEAD MANAGER, SBI CAPITAL MARKETS LIMITED HAS FURNISHED TO SEBI A DUE DILIGENCE CERTIFICATE DATED THE 20^TH OCTOBER 2000 IN ACCORDANCE WITH SEBI (MERCHANT BANKERS) REGULATIONS, 1992, WHICH READS AS FOLLOWS:

1. WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH COLLABORATORS, ETC., AND OTHER MATERIALS IN CONNECTION WITH THE FINALISATION OF THE OFFER DOCUMENT PERTAINING TO THE SAID OFFER.
2. ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE COMPANY, ITS DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES, INDEPENDENT VERIFICATION OF THE STATEMENTS CONCERNING OBJECTS OF THE OFFER, PRICE JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTS MENTIONED IN THE ANNEXURE AND OTHER PAPERS FURNISHED BY THE ISSUER.

1. THE OFFER DOCUMENT FORWARDED TO SEBI IS IN CONFORMITY WITH THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE ISSUE.
2. ALL THE LEGAL REQUIREMENTS CONNECTED WITH THE SAID ISSUE AS ALSO THE GUIDELINES, INSTRUCTIONS, ETC. ISSUED BY SEBI, THE GOVERNMENT AND ANY OTHER COMPETENT AUTHORITY IN THIS BEHALF HAVE BEEN DULY COMPLIED WITH; AND
3. THE DISCLOSURES MADE IN THE OFFER DOCUMENT ARE TRUE, FAIR AND ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL INFORMED DECISION AS TO THE INVESTMENT IN THE PROPOSED ISSUE.

1. WE CONFIRM THAT BESIDES OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE OFFER DOCUMENT ARE REGISTERED WITH SEBI AND THAT TILL DATE SUCH REGISTRATION IS VALID.
2. WE SHALL SATISFY OURSELVES ABOUT THE WORTH OF THE UNDERWRITERS TO FULFIL THEIR UNDERWRITING COMMITMENTS.

Disclaimer Statement from the Issuer

The Company accepts no responsibility for statements made otherwise than in the Offer Document or in the advertisements or other material issued by or at the instance of the Company and that anyone placing reliance on any other source of information would be doing so at their own risk.

Listing

Applications will be made to The Stock Exchange, Mumbai, the National Stock Exchange of India Limited, Mumbai, Delhi Stock Exchange, Bangalore Stock Exchange and Calcutta Stock Exchange for permission to deal in and for official quotation of the equity shares of the Company.

If the permissions to deal in and for an official quotation of the equity shares are not granted by any of the Stock Exchanges, the Company shall forthwith repay, without interest, all such moneys received from the applicants in pursuance of this Offer Document. If such money is not repaid within eight days after the Company becomes liable to repay it (i.e. from the date of refusal or within 70 days from the date of closing of the subscription list, whichever is earlier), then the Company will be liable to repay the money, with interest, as prescribed under Section 73 of the Companies Act.

Disclaimer Clause of the National Stock Exchange of India Limited

As required, a copy of this Offer Document has been submitted to National Stock Exchange of India Limited (hereinafter referred to as NSE). NSE has given vide its letter dated ……………….permission to the Issuer to use the Exchange's name in this Offer Document as one of the stock exchanges on which this Issuer's securities are proposed to be listed subject to the Issuer fulfilling various criteria for listing including the one related to market capitalisation (i.e. market capitalisation shall not be less than Rs. 25 crores at the time of listing). The Exchange has scrutinised this Offer Document for its limited internal purpose of deciding on the matter of granting the aforesaid permission to this Issuer. It is to be distinctly understood that the aforesaid permission given by NSE should not in any way be deemed or construed that the Offer Document has been cleared or approved by NSE; nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this Offer Document, nor does it warrant that this Issuer's securities will be listed or will continue to be listed on the Exchange; nor does it take any responsibility for the financial or other soundness of this Issuer, its promoters, its management or any scheme or project of this Issuer.

Every person who desires to apply for or otherwise acquire any securities of this Issuer may do so pursuant to independent inquiry, investigation and analysis and shall not have any claims against the Exchange whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/ acquisition whether by reason of anything stated or omitted to be stated herein or any other reason whatsoever."

Disclaimer Clause of the Stock Exchange, Mumbai

The Stock Exchange, Mumbai (‘BSE’) has given, vide its letter dated ……, permission to the Company to use the name of the Exchange in this Offer Document as one of the stock exchanges on which this Company’s securities are proposed to be listed. BSE has scrutinised this Offer Document for its limited internal purpose of deciding on the matter of granting the aforesaid permission to the Company. BSE does not in any manner –

1. warrant, certify or endorse the correctness or completeness of any of the contents of this Offer Document;
2. warrant that this Company’s securities will be listed or will continue to be listed on BSE; or
3. take any responsibility for the financial or other soundness of this Company, promoters, management or any scheme or project of this Company;

Disclaimer Clause of the Delhi Stock Exchange

The Delhi Stock Exchange has given, vide its letter dated…………., permission to the Company, to use the Exchange’s name in this Offer Document as one of the stock exchanges on which this Company’s securities are proposed to be listed. The exchange has taken on record this Offer Document for its limited internal purpose of deciding on the matter of granting the aforesaid permission to the Company based on the assurances, averments, statements and other managerial , administrative, technical and financial information duly seen and examined by the Lead Managers/Managers/Advisors and Directors and Managers of the company. The Exchange does not in any manner:

1. warrant, certify or endorse the correctness or completeness of any of the contents of this Offer Document; or
2. warrant that this Company's securities will be listed or will continue to be listed on the Exchange; or
3. take any responsibility for the financial or other soundness of this Company, its Promoters, its management or any scheme or project of this Company;


and it should not for any reason be deemed or construed that this Offer Document has been cleared or approved by the Exchange. Every person who desires to apply for or otherwise acquires any securities of this Company may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against the Exchange whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/ acquisition whether by reason of anything stated or omitted to be stated herein or any other reason whatsoever.

Disclaimer Clause of the Bangalore Stock Exchange

The Stock Exchange, Bangalore (Bgse), has , vide their letter dated the…………., given permission to the Company to use the name of the Exchange in this Offer Document as one of the stock exchanges on which this Company’s securities are proposed to be listed. Bgse has scrutinised this Offer Document for its limited internal purpose of deciding on the matter of granting the aforesaid permission to the Company. Bgse does not in any manner:

4. warrant, certify or endorse the correctness or completeness of any of the contents of this Offer Document; or
5. warrant that this Company's securities will be listed or will continue to be listed on the Exchange; or
6. take any responsibility for the financial or other soundness of this Company, its Promoters, its management or any scheme or project of this Company;


and it should not for any reason be deemed or construed that this Offer Document has been cleared or approved by Bgse. Every person who desires to apply for or otherwise acquires any securities of this Company may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against Bgse, whatsoever, by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/ acquisition whether by reason of anything stated in the Offer Document or any other reason whatsoever.

DISCLAIMER CLAUSE OF THE CALCUTTA STOCK EXCHANGE

The Calcutta Stock Exchange(CSE), has , vide their letter dated the……….., given permission to the Company to use the name of the Exchange in this Offer Document as one of the stock exchanges on which this Company’s securities are proposed to be listed. CSE does not in any manner:

7. warrant, certify or endorse the correctness or completeness of any of the contents of this Offer Document; or
8. warrant that this Company's securities will be listed or will continue to be listed on the Exchange; or
9. take any responsibility for the financial or other soundness of this Company, its Promoters, its management or any scheme or project of this Company;

Impersonation

As a matter of abundant caution, the attention of the investor is drawn to the provision of Section 68 (A) of the Companies Act, 1956, reproduced below:

Disclaimer in Respect of Jurisdiction

This Issue is made in India to persons resident in India ( including Indian nationals resident in India, who are majors, Hindu Undivided Families, companies, corporate bodies and societies registered under the applicable law in India and authorised to invest in shares, Indian Mutual Funds registered with SEBI, Indian Financial Institutions, Commercial Banks and Regional Rural Banks, Co-operative Banks[subject to RBI permission], Trusts registered under Societies Registration Act, 1860, or any other Trust Law and who are authorised under their constitution to invest in shares), NRIs, OCBs and FIIs [registered with SEBI] as defined under Indian laws. This Offer Document does not, however, constitute an offer to sell or an invitation to subscribe to shares offered hereby in any other jurisdiction to any person to whom it is unlawful to make an offer or invitation in such jurisdiction. Any person into whose possession this Offer Document comes is required to inform himself about and to observe any such restrictions. Any disputes arising out of this Issue will be subject to the exclusive jurisdiction of the courts of Mumbai.

Filing of the Offer Document with the Board and RoC

A copy of the Offer Document having attached thereto the documents required to be filed under Section 60 of the Companies Act, 1956 will be delivered for registration to the Registrar of Companies, Mumbai. A copy of the Offer Document has also been filed with the SEBI at their office at Mittal Court, Nariman Point, Mumbai.

Minimum Subscription

If the Company does not receive minimum subscription of 90% of the net offer to public including devolvement of underwriters within sixty days from the Issue Closing date for Fixed Price Portion, the Company shall forthwith refund the entire subscription amount received. If there is a delay beyond 8 days after the Company becomes liable to pay the amount, the Company shall pay interest prescribed under Section 73 of the Companies Act, 1956

Letters of Allotment/ Share Certificates/ Refund Orders

The Company will despatch letters of allotment/ share certificates, letters of regret, cancelled stockinvest and refund orders, if any, in excess of Rs. 1500/-, as the case may be, by Registered Post/ Speed Post at the sole/ first applicant's risk and give credit to the beneficiary account with the depository participants, within 15 days of from the issue closing date for the fixed price portion, Refund orders up to Rs. 1500/- will be sent under Certificate of Posting. Further, allotment of the equity shares relating to the Book Built portion shall be made within 15 days of the Offer Closing Date for the Book Built portion and refunds will be made within 15 days of the Bid Closing Date,

1. allotment of Equity Shares offered to the public shall be made within 15 days of the Offer Closing Date for Fixed Price Portion
2. the Company shall pay interest at the rate of 15% per annum (for the delayed period beyond 15 days and except to the applicants applying through Stockinvest) if the allotment and has not been and/ or the Letters of Allotment/ Refund Orders have not been despatched to the investors within 15 days from the aforesaid dates. If there is a delay beyond 15 days, the Company shall be liable to repay the money along with interest @ 15% per annum.

ISSUE PROGRAMME

BOOK BUILT PORTION
 

Bid opens on
Bid closes on
Offer opening date
Offer closing date for Book Built Portion

Bids and any revision in bids shall be accepted only in the bidding period between 10.a.m. and 3 p.m. at the Syndicate Members' bidding centres mentioned in the Bid Form.

FIXED PRICE PORTION

The subscription list will open at the commencement of banking hours and will close at the close of banking hours on the dates mentioned below:
 

Issue opening date
Issue closing date for the Fixed Price Portion

The Issuer accepts full responsibility for the accuracy of the information given in this Offer Document and confirm that to the best of their knowledge and belief, there are no other facts, the omission of which makes any statement in this Offer Document, misleading and they confirm that they have made all reasonable enquiries to ascertain such facts.

Book Building Process

Book building refers to the collection of Bids from investors, which is based on a floor price that is announced, the final issue price being fixed after the Bid Closing Date, through the process of price discovery. The principal players involved in a book building process are:

1. The Company
2. A Book Running Lead Manager (BRLM), who is a Category I Merchant Banker and who, in this case, is SBI Capital Markets Ltd. The Book Running Lead Manager is also the Lead merchant banker.
3. Co-Managers, Syndicate Members, who are intermediaries registered with SEBI and who are permitted to carry on activities as underwriters. Syndicate Members are appointed by the Book Running Lead Manager and/or Co-Book Running Lead Managers.

In this regard, the Company has appointed SBI Capital Markets Limited as the Book Running Lead Manager (BRLM). The BRLM has formed a Syndicate consisting of the Book

Running Lead Manager, Co- Book Running Lead Manager to the Issue, Co-Managers to the

Issue, and the Syndicate Members to procure subscription for the equity shares.
 
 
 
 
 
 
 
 
 
 

Issue management team
 

Book Running Lead Manager to the Offer

SBI CAPITAL MARKETS LIMITED  202, Maker Tower ‘E’ Cuffe Parade Mumbai – 400 005 Tel. : (022) 218 9166 Fax.: (022) 218 8332

 

Co-Managers to the Offer

Centrum Finance Limited

93, Atlanta Bldg.

209, Nariman Point

Mumbai 400 021

Tel No. (022) 283 6585

Fax No. (022) 2853953

Tata Finance Limited

Bombay House,

24, Homi Mody Street,

Mumbai 400 001

Tel No. (022) 2049131

Fax No. (022) 2045928

Legal Advisors to the Lead Managers

M/s Amarchand & Mangaldas & Suresh A.Shroff & Co.

Presidential Towers

3, LS Centre, Pamposh Enclave

New Delhi- 110 048

Registrars to the Offer

Karvy Consultants Limited

"Karvy House" 46, Avenue 4,

Street No.1,Banjara Hills,

Hyderabad 500 034.

Tel: (040) 331 2454, 3320751

Fax: (040) 331 1968

Auditors

M/s. Anil A. Masand & Co.,

Chartered Accountants

15, Crystal Premises,

Cosmos Commercial Centre,

3^rd Road, Khar,

Mumbai – 400052

Tel : (022) 6482720 /6493608

Legal Advisor to the Offer

Anil Menon

Advocate

4, Yashwant Chambers, 3^rd Floor,

18, Burjorji Bharucha Marg,

Fort, Mumbai – 400023

Tel : (022) 2696810 / 2696814

Fax: (022) 2696812

e-mail : amen@VSNL.com

Bankers to the Company

Global Trust Bank Limited

Ground Floor, Mahatma Gandhi

Seva Mandir Trust Building

Opp. Bandra Talao

S.V. Road

Bandra (West)

Mumbai 400 050.

Bankers Associated with the Offer

Escrow Collection Bank
 
 

Bankers to the Offer

Compliance Officer

Ms. Varsha Sawant

Company Secretary

Nimbus Communications Limited

101B Vidyanand, 107 Theresa Road

Bandra, Mumbai- 400 050

Tel.: (022) 600 2403

Fax: (022) 600 2405

e-mail: vsawant@nimbus.co.in
 
 

Credit Rating/ Appointment of the Trustees

This being an Issue of Equity Shares, no credit rating or appointment of Debenture Trustees is required.

Underwriting Agreements

i) Book Built Portion:

After determination of the final price and prior to the final filing of the Offer Document with RoC, the Company would enter into Underwriting Agreements with the BRLM, Co-BRLMs and the Syndicate Members for the equity shares offered through the Book Building Portion. In terms of these Underwriting Agreements, the BRLM and the Co-BRLMs shall be responsible for bringing in the amount devolved in the event the Syndicate Members do not fulfil their underwriting obligations.

The details of underwriting for book-built portion are as given below:
 
 

(The above portion has been intentionally left blank and will be filled in before filing of the Offer Document with RoC)

The Underwriters have indicated their intention to underwrite the following number of shares.
 

Name and address of the underwriter	Indicated number of shares to be underwritten
SBI CAPITAL MARKETS LIMITED 202, Maker Tower ‘E’ Cuffe Parade Mumbai – 400 005

 

The details given above are indicative and the actual underwriting arrangement would be finalised after the pricing and allocation.

Note: The BRLM, Co-BRLMs and the syndicate members shall be responsible for ensuring the payment of the amount allocated to investors procured by them. In the event of any default in payment, the respective underwriter, in addition to other obligations defined in the underwriting agreement, will also be required to procure/ subscribe to the extent of the defaulted amount.

In the opinion of the Board of Directors (based on a certificate given to the Board by BRLM) and in the opinion of the BRLM on the basis of the declarations by the Syndicate Members, the resources of the above mentioned Syndicate Members are sufficient to enable them to discharge their respective underwriting obligations in full. All the above mentioned Syndicate Members are registered with SEBI under Section 12(i) of the SEBI Act, 1992. All letters of underwriting mentioned above have been accepted by the Board of Directors of the Company at their meeting held on _________ and letters of acceptance have been issued by the Company to the Underwriters.
 
 

ii) Fixed Price Portion:

The equity shares proposed to be offered through the Fixed Price Portion are fully underwritten. The details of the underwriting for Fixed Price Portion are as given below:
 
 
 
 

(The above portion has been intentionally left blank and will be filled in before filing of the Offer Document with RoC)

The Underwriters have indicated their intention to underwrite the following number of shares.
 

Name and address of the underwriter	Indicative number of shares to be underwritten
SBI CAPITAL MARKETS LIMITED 202, Maker Tower ‘E’ Cuffe Parade Mumbai – 400 005

 

The details given above are indicative and this would change before Offer Document is filed with RoC.

In the opinion of the Board of Directors (based on a certificate given to the Board by BRLM and Co-BRLMs) and in the opinion of the BRLM and Co-BRLMs, on the basis of the declarations by the Underwriters, the resources of the above mentioned Underwriters are sufficient to enable them to discharge their respective underwriting obligations in full. All the above mentioned Underwriters are registered with SEBI under Section 12(i) of the SEBI Act, 1992. All letters of underwriting mentioned above have been accepted by the Board of Directors of the Company at their meeting held on _________ and letters of acceptance have been issued by the Company to the Underwriters.
 
 

1. CAPITAL STRUCTURE OF THE COMPANY

The Public Issue includes a Book Building Portion of …….Equity Shares aggregating Rs…. crores (90%) and a Fixed Price Offer of …………Equity Shares aggregating Rs…. crores (10%).

** Can be determined only after the Issue Price is known after the Book Building Process. However, as per SEBI guidelines at least 42,00,000 equity shares would be offered.

Notes on Capital Structure

1. Capital Build-up: Details of the contribution to the equity share capital of the company are as under:

These represent shares at a face value of Rs.10/- each. After the split, the total number of shares stands at 3,60,00,000 equity shares of a face value of Rs.5/- per share.

Shareholding pattern of the Promoter Group:

	No. of shares
Shri Harish Thawani	9258400
Shobha Thawani	2160000
TOTAL (A)	11418400
% to pre-issue capital	31.72%

• Shares issued to NCCL as consideration for take over of business under scheme of arrangement:

• Other shareholders

1. Promoters' holding and Lock in provisions: The holding of the Promoter Group would reduce after the Issue from 98.39%…… to ……….The Promoters’ stake on the expanded capital (i.e. capital after the exercise of options granted till date) would be ……..%.

 

 
 

The lock-in of Promoters’ contribution would be as under:

Name of the Promoter	Date of Allotment	No. of Shares	Nominal Value	% stake in total Pre-Issue Capital	% stake in total Post-Issue Capital	Period of lock-in
Shri Harish Thawani	31.12.1997	31,58,000	1,57,90,000	8.77%		3 years from the date of allotment in this Offer
Ms. Shobha Thawani	31.12.1997	8,42,000	42,10,000	2.34%		3 years from the date of allotment in this Offer
Mr. Harish Thawani	10.08.1994	55,27,000	2,76,35,000	15.35%		3 years from the date of allotment in this Offer
Ms. Shobha Thawani	10.08.1994	13,18,000	65,90,000	3.66%		3 years from the date of allotment in this Offer
TOTAL					20%

For computing the post-issue capital , the ESOP shares vested prior to the issue would be taken into account.The exact number of shares that would be locked-in would be determined after the price and the number of shares under offer are finalised. 20% of the post –issue capital will be locked in for 3 years from the date of allotment in this offer.

Further, the entire pre-issue capital, other than the promoters’ shareholding, as mentioned above, would be locked in for a period of one year from the date of allotment in this offer.

2. The Authorised capital of the Company was increased from Rs. 6 crores (Rupees Six Crores only) divided into 60,00,000 (Sixty Lacs) Equity Shares of Rs.10 each to Rs.30 crores (Rupees Thirty Crores only) divided into 3,00,00,000 (Three Crores) Equity Shares of Rs.10 each by creating 2,40,00,000 (Two crores forty lacs) new Equity Shares of Rs.10 each. After the share split, the authorised capital now stands at 6,00,00,000 (Six crore) equity shares of Rs.5/- each.
3. The Company has not raised any bridge loan or taken any financial assistance against the proceeds of this Public Issue.
4. In the event of the Public Issue (Fixed Price Offer) of equity shares being oversubscribed, the basis of allotment for the Fixed Price Offer will be finalised in consultation with The Stock Exchange, Mumbai (Regional Stock Exchange).
5. The allotment of equity shares in case of oversubscription in the Fixed Price Portion will be on a proportionate basis.
6. Separate applications for dematerialised/ electronic and physical Equity Shares by the same applicant shall be treated as multiple applications and are liable to be rejected.
7. In the event of oversubscription, in the process of rounding off, to ensure allotment in marketable lots, the Company may make such adjustments in the basis of allotment as may be necessary in consultation with the SEBI/ the Regional Stock Exchange (Mumbai), so as to allot additional equity shares upto a maximum of 10% of net public offer in respect of the fixed price offer.
8. Details of transactions in shares by the Promoters during the last six months are as under:


There have been no transactions by the Promoters in the equity shares of the Company from June, 2000 to December 15^th, 2000.

9. NIMBUS – EMPLOYEE STOCK OPTION SCHEME (ESOS)

• The first lot of 40% of the ISO granted to an employee has vested on 1^st December 2000.
• The second lot of 30% of the ISO granted to an employee will be vested after 18 months from the grant date, the vesting date would be 1^st June 2001
• The third lot of 30% of the ISO granted to an employee will be vested after 30 months from the grant date, the vesting date would be 1^st June 2002.

1. RBI vide its letter no. CO/FID(II)/5281/10.02.40(9049)99-2000 dt. 20^th April 2000 has accorded its approval for the Issue of Equity Shares to FIIs on a repatriable basis. FIIs can invest upto 24% of the post issue capital. As per RBI Notification No. FERA 187/98-RB dated 3^rd October 1998 as amended vide Notification No. FERA 190/98-RB dated the 2^nd December 1998, under the general permission granted by RBI, the Company is eligible to issue shares to NRIs and OCBs under the 24% scheme. Thus, the Company can issue shares to NRIs/OCBS on a repatriation basis, provided the shareholding of NRIs/ OCBs in the Company does not exceed 24% of the public issue. The Company has restricted foreign holdings to the extent of 20% of its post-issue paid-up capital. The sale proceeds of such investment in equity shares by NRIs/OCBs will be allowed to be repatriated along with the income thereon, subject to instructions from RBI then in force and subject to the Indian Tax Laws, provided that the investments are made by inward remittance from abroad through approved banking channels or out of funds held in NRE/FCNR accounts maintained with a bank in India.
2. Top ten Shareholders (to be updated at the time of RoC filing)


a) As on date of filing the Offer Document with the SEBI/ROC

Name	No. of shares held	% shareholding
Nimbus Creative Corporation Limited	24000000	66.67
Shri Harish Thawani	9258400	25.72
Shobha Thawani	2160000	6.00
P.N. Budhrani	153000	0.43
Shashi Agrawal	156000	0.43
So-Ex Flora P.Ltd.	100000	0.28
So-Ex Investments and Finance Pvt. Ltd.	100000	0.28
Mackertich Consultancy Services Pvt. Ltd.	56000	0.16
Rajendra Babani	7000	0.02
K.M.Thawani	2000	0.01
K.K.Thawani	2000	0.01
D.K.Thawani	2000	0.01
Mavis Monteiro	2000	0.01

b) 10 days prior to the date of SEBI/RoC filing

Name	No. of shares held	% shareholding
Nimbus Creative Corporation Limited	24000000	66.67
Shri Harish Thawani	9258400	25.72
Shobha Thawani	2160000	6.00
P.N. Budhrani	153000	0.43
Shashi Agrawal	156000	0.43
So-Ex Flora P.Ltd.	100000	0.28
So-Ex Investments and Finance Pvt. Ltd.	100000	0.28
Mackertich Consultancy Services Pvt. Ltd.	56000	0.16
Rajendra Babani	7000	0.02
K.M.Thawani	2000	0.01
K.K.Thawani	2000	0.01
D.K.Thawani	2000	0.01
Mavis Monteiro	2000	0.01

c) Two years prior to the date of SEBI/RoC filing (as on 12/12/1998)

Name	No. of shares held	% shareholding
Shri Harish Thawani	47,37,000	78.95
Shobha Thawani	12,63,000	21.05
Total	60,00,000	100.00

3. There are no buy-back or standby arrangements for the purchase of Equity Shares issued through this Offer Document by the Promoters, Directors or the Merchant Bankers.

The Company hereby undertakes that:

1. the complaints received in respect of the Offer shall be attended to expeditiously and satisfactorily;
2. all steps for completion of the necessary formalities for listing and commencement of trading at all Stock Exchanges where the securities are to be listed are taken within 7 working days of finalisation of basis of allotment.
3. the Issuer shall apply in advance for the listing of equity shares
4. the funds required for despatch of refund orders/allotment letters/ certificates by registered post shall be made available to the Registrar to the Offer by the issuer company;
5. the certificates of the securities/refund orders to the non-resident Indians shall be despatched within specified time.
6. no further issue of securities shall be made till the securities offered through this Offer Document are listed or till the application moneys are refunded on account of non-listing, undersubscription, etc.

1. The Company accept no responsibility for statements made otherwise than in the Offer Document or in the advertisements or other material issued by or at the instance of the Company and the Lead Managers and any one placing reliance on any other source of information would be doing so at his own risk.
2. In the opinion of the Directors of the Company, there are no circumstances that have arisen since the date of the last financial statement disclosed in the Offer Document, that materially or adversely affect or are likely to affect performance or profitability of the Company, or value of its assets, or its ability to pay its liabilities within the next twelve months.
3. The Company declares that the Stock Exchanges to which application for official quotation has been made does not take any responsibility for the financial soundness of the Issue or for the price at which the instruments are issued or for the correctness of the statements made or opinion expressed in the Offer Document.

The sums received in respect of the Offer will be kept in a separate account with the Bankers to the Offer and the Company will not have access to such funds unless allotment/allocation of equity shares has been made in consultation with the Stock Exchange, Mumbai, and approval is obtained for dealing of equity shares from all the Stock Exchanges, where listing is proposed.

The Board of Directors of the Company certifies that: -

1. all monies received out of issue of shares to public shall be transferred to a separate bank account other than the bank account referred to in sub-section (3) of Section 73 of the Companies Act, 1956;
2. details of all monies utilised out of this Issue referred to in sub-item (i) shall be disclosed under an appropriate separate head in the Annual Report of the Company indicating the purpose for which such monies had been utilised; and
3. details of all unutilised monies out of this Issue, if any, referred to in sub-item (i) shall be disclosed under an appropriate separate head in the Annual Report of the Company indicating the form in which such unutilised monies have been invested.

1. the utilisation of monies received under reservations to employees shall be disclosed under an appropriate head in the Company’s Balance Sheet indicating the purpose for which such monies have been utilised
2. the details of all unutilised monies out of the funds received under reservations shall be disclosed under a separate head in the Balance Sheet of the Company indicating the form in which such unutilised monies have been invested.

The SEBI guidelines in respect of corporate governance shall be applicable to the Company immediately on the listing of shares on the various stock exchanges. The Company undertakes that it shall take the necessary step to comply with all the requirements of the guidelines on corporate governance as would be applicable to it upon listing of its shares. In this regard, the Company is taking steps to further broad base its Board of Directors and also set up the necessary committees as per the requirements of the revised guidelines.
 
 
 
 

1. Terms of the present issue

ISSUE STRUCTURE
 

Book Building Portion
	Institutional Investors	Non-Institutional Investors	Retail
Number of shares available	………..	…………..
% of the net public offer	60%	15%	15%
Basis of allotment	Discretionary	Proportionate	Proportionate
Minimum bid/ application size and multiples thereof	Minimum bid size- 1050 shares and in multiples of 50 shares	Minimum bid size- 1050 shares and in multiples of 50 shares	Minimum bid size- 50 shares and in multiples of 50 shares
Maximum bid/ application size	……………..	…………………	1000
Allotment mode	Compulsory demat	Compulsory demat	Optional demat
Market lot for trading	1 share	1 share	1 share
Who can apply	Qualified Institutional Buyers as defined by SEBI	Individuals, Corporates, NRIs and OCBs, Trusts and Societies, eligible to invest in equity shares.	Individuals, HUFs (Karta to apply on behalf of HUF), bidding upto 1000 shares

 
 

Fixed Price Portion
Number of shares available	………….
Reservation for allotment to employees on a competitive basis	2,00,000
Fixed price portion being offered to the public	…………
% of total issue	10%
Basis of allotment	Proportionate
Minimum bid/ application size and multiples thereof	50 shares and in multiples of 50 shares
Maximum bid/ application size	1000 shares
Allotment mode (compulsory demat/ optional demat)	Optional demat
Market lot for trading	1 share for demat trading
Who can apply	Only individuals (Karta to apply on behalf of HUF) (applying upto 1000 shares), who have not participated in the Book Building or have not received any allocation in the Book Built portion.

 

The equity shares now being offered are subject to the provisions of the Act, Memorandum and Articles of Association of the Company, terms of this Offer Document , the application form, the guidelines for listing of securities issued by the Stock Exchanges and Government of India and/or other statutory bodies and the guidelines for Disclosure and Investor Protection issued by the Securities and Exchange Board of India ("SEBI Guidelines") and the Depositories Act, 1996, to the extent applicable.

Interest in case of delay in Despatch of Allotment Letters / Refund Orders

The Company agrees that, as far as possible allotment of securities offered to the public shall be made within 30 days of the closure of the offer (public issue and the offer for sale). The Company and the Offer or further agree that it shall pay interest @ 15% per annum if the allotment letters/ refund orders have not been despatch to the applicants within 30 days from the date of the closure of the issue. However applications received after the closure of the issue in fulfillment of underwriting obligations to meet the minimum subscription requirement shall not be entitled for the said interest.

Rights of the Equity Shareholders

1. Right to receive dividend, if declared
2. Right to attend general meetings and exercise voting powers, unless prohibited by law
3. Right to vote personally or by proxy
4. Any other rights available under the Companies Act, 1956

Face value and issue price of Equity Shares

Equity Share of face value of Rs. 5/-each are being offered at a premium of Rs.X per share.

(the Issue Price to be filled in before the RoC filing)

Ranking of equity Shares

The equity shares to be issued shall rank pari-passu with the existing equity shares of the Company including dividend, if any, declared for the financial year 2000-01.

Forfeiture

It is a condition of this issue of equity shares that non-payment of the amount due on allotment will attract interest at 18% p.a. on the allotment money due commencing from the last date appointed for payment thereof till payment. Failure to pay the amount as aforesaid shall render the allotment of equity shares liable to cancellation and amount paid liable to forfeiture. The Company shall be at liberty to re-issue the equity shares so forfeited to any person or persons, as it may in its absolute discretion deem fit.

Terms of Payment of the Equity Shares

Book Built Portion- Institutional Segment

A Bid must be for a minimum of 1050 equity shares and in multiples of 50 equity shares thereafter. A Bidder cannot make a bid for more than the number of shares offered through book building. Further a bidder cannot bid at a bid price lower than the floor price.

The bid size of the institutions and other investors shall not exceed the investment limit prescribed for them by various regulatory authorities.

The maximum amount has to accordingly be paid at the time of bidding based on the highest bidding option of the Bidder. Where a Bidder has been allocated lesser number of shares than he or she had bid for, the excess amount paid on bidding, if any, will be adjusted towards application money or refunded to such Bidder within 15 days from the Bid closing date. Where the payment of bid price is at the time of the bidding is waived at the discretion of the Syndicate Member, the issue price or the difference, as the case may be, is to be paid within 3 days of advertisement of the basis of allocation.

The allotment of securities relating to the Book Built Portion shall be made within 15 days from the Issue Closing Date for Book Built Portion. The Company shall pay interest @15% p.a., (except to Bidders applying through stock invest) if allotment is not made within 15 days from the Issue Closing Date for Book Built Portion and refunds are not made within 15 days of Bid Closing Date, for any delay beyond 15 days.

In relation to the Book Built Portion, the BRLM and other Co-BRLMs, as may be designated for this purpose and the Company shall open an Escrow Account at the Escrow Collection Bank for the collection of the monies payable upon submission of the Bid Form. Each Bidder shall, with the submission of the Bid Form draw a cheque/ demand draft for the maximum amount of his bid in favour of the Escrow Account of the Escrow Collection Bank and submit the same to the Syndicate Member(s). Bid Forms accompanied by cash will not be accepted. All investors shall be required to indicate the price in their bids at Floor price or above in multiples of Rs.5/-. "Cut-Off" price bidding will not be allowed and such bids will be treated as invalid. The Syndicate Members may, at their discretion, waive such payment at the time of submission of the bid form, in which case the issue price or the difference, as the case may be, is to be paid within 3 days of advertisement of the basis of allocation. If the payment is not made favouring the Escrow Account within the time stipulated above, the bid of the bidder is liable to be cancelled and the Syndicate Member shall brings in funds under his underwriting obligations.

The Syndicate Member(s) shall deposit such cheque/demand draft with the Escrow Collection Bank, which will hold the monies for the benefit of the Bidders till such time as the Issue Opening Date. On the Issue Opening Date, the Escrow Collection Bank shall transfer the funds from the Escrow Account, as per the terms of the Escrow Agreement, into the Public Issue Account with the Bankers to the Offer.

A Bidder cannot make a bid for more than the number of shares offered through book building portion and an applicant cannot make an application for more than the number of shares offered through the fixed price portion.

Book Built portion-The Non-Institutional Segment:

The terms of payment for bidders in the Non-institutional segment category of the Book Built portion of the Offer would be, mutatis mutandis, similar to those for the institutional portion of the book built portion of the Offer.

Book Built portion- The Retail Segment

The Bid must be for a minimum of 50 equity shares and in multiples of 50 equity shares thereafter. A Bidder cannot make a bid for more than the number of shares offered through book building. Further a bidder cannot bid at a bid price lower than the floor price.

The maximum amount has to accordingly be paid at the time of bidding based on the highest bidding option of the Bidder. Where a Bidder has been allocated lesser number of shares than he or she had bid for, the excess amount paid on bidding, if any, will be adjusted towards application money or refunded to such Bidder within 15 days from the Bid closing date. Where the payment of bid price is at the time of the bidding is waived at the discretion of the Syndicate Member, the issue price or the difference, as the case may be, is to be paid within 3 days of advertisement of the basis of allocation.

The allotment of securities relating to the Book Built Portion shall be made within 15 days from the Issue Closing Date for Book Built Portion. The Company shall pay interest @15% p.a., (except to Bidders applying through stock invest) if allotment is not made within 15 days from the Issue Closing Date for Book Built Portion and refunds are not made within 15 days of Bid Closing Date, for any delay beyond 15 days.

In relation to the Book Built Portion, the BRLM and other Co-BRLMs, as may be designated for this purpose and the Company shall open an Escrow Account at the Escrow Collection Bank for the collection of the monies payable upon submission of the Bid Form. Each Bidder shall, with the submission of the Bid Form draw a cheque/ demand draft for the maximum amount of his bid in favour of the Escrow Account of the Escrow Collection Bank and submit the same to the Syndicate Member(s). Bid Forms accompanied by cash will not be accepted. All investors shall be required to indicate the price in their bids at Floor price or above in multiples of Rs.5/-. "Cut-Off" price bidding will not be allowed and such bids will be treated as invalid. The Syndicate Members may, at their discretion, waive such payment at the time of submission of the bid form, in which case the issue price or the difference, as the case may be, is to be paid within 3 days of advertisement of the basis of allocation. If the payment is not made favouring the Escrow Account within the time stipulated above, the bid of the bidder is liable to be cancelled and the Syndicate Member shall brings in funds under his underwriting obligations.

The Syndicate Member(s) shall deposit such cheque/demand draft with the Escrow Collection Bank, which will hold the monies for the benefit of the Bidders till such time as the Issue Opening Date. On the Issue Opening Date, the Escrow Collection Bank shall transfer the funds from the Escrow Account, as per the terms of the Escrow Agreement, into the Public Issue Account with the Bankers to the Offer.

Terms of payment for different categories of investors is given below:
 

Category	Terms of payment (margin)
Institutional ( excluding FIIs)	No margin
Non Institutional (excluding NRIs & OCBs)	…%
NRIs, OCBs and FIIs	…%
Retail individual investors	…%

Spill-Over Option

Retail Bidders, who have not received any allocation in the Book Built Portion, shall have the option of being considered for allotment in the Fixed Price Portion subject to fulfillment of the following conditions :

• The Retail Bidder should clearly exercise the Spill-Over Option by filing the relevant portion of the Bid Form properly. In case the Retail Bidder does not exercise such option or does not fill the relevant portion of the Bid Form properly, it shall be deemed that the Retail Bidder has not opted for such Spill-Over option.

• The Retail Bidder should not have received any allocation of equity shares in the Book Built Portion. This aspect will be verified by the Registrar to the Offer without any reference or intimation to the Retail Bidder who exercises the Spill-Over Option.

• The Retail Bidder should have bid for the equity shares at or above the Offer Price. The Retail Bidder should have deposited the entire Bid Amount in the Escrow Account of the Company at the time of making the Bid. In such case the amounts deposited by the Retail Bidders into the Escrow Account of the Company under the Book Built Portion shall be entirely transferred into the Public Offer Account. The Bid of the Retail Bidders who exercise the Spill Over Option will be considered to be an application for the Fixed Price Portion for such number of equity shares (rounded off to the lower multiple of 50) as are derived by dividing the Bid Amount paid by such Retail Bidder by the Issue Price.

Bidders opting for the Spill-Over Option cannot make another application in the Fixed Price Portion as first/sole applicant. In case the Bidders makes such additional application(s), all the applications including the Spill-Over Option would be treated as multiple applications and would be liable for rejection.

It is hereby clarified that by the exercise of the Spill-Over Option, the Bid Form shall be deemed to convert into an Application Form for the Fixed Price Portion, if all the above conditions are fulfilled.

Withdrawal of the Offer:

If the price discovered through the Book Building mechanism is not acceptable to the Company, the Company reserves the right to withdraw the offering from the market.

Fixed Price Portion

Application must be for a minimum of 50 equity shares and in multiples of 50 equity shares thereafter. The maximum application size in the fixed price portion will be for 1000 equity shares.

The terms of payment are as follows:
 

	Amount Payable (Rs.)
On application	100% of the issue price

In case an applicant has been allotted lesser number of shares than he or she had applied for, the application money will be adjusted towards the final payment and the balance, if any, will be refunded.

Allotment of securities relating to the Fixed Price Portion shall be made within 15 days from the Issue Closing Date for Fixed Price Portion. The Company shall pay interest @15% p.a., (except to applicants applying through stock invest) if allotment is not made and refund orders are not despatched to the investors within 15 days from the Issue Closing Date for Fixed Price Portion for any delay beyond 15 days.
 
 

Note

Trading of Equity Shares of the Company shall be in compulsory dematerialised form in accordance with RMB (Compendium) Series Circular No. (1999-2000) dated February 16, 2000. The investors, however, will have an option to apply for either physical form or in dematerialised form. While the share certificates will be issued in lots of 50 shares and the bid/ application has to be submitted in multiples of 50 shares, the trading lot will be 1 share.

Issue Structure

This Issue of Rs.182.25 crores is being made through the 90% Book Building scheme. Not more than 60% of the Offer size(….equity shares) shall be made available for allocation on a discretionary basis to Institutional Investors (i.e. QIBs) and not less than 15% of the Offer size(….. equity shares) shall be available on proportionate basis to Non Institutional Investors. The balance …. equity shares (not less than 15% of the Offer size) shall be available for allocation on proportionate basis to the retail investors.

The Fixed price portion of the Offer will constitute 10% of the Offer(… equity shares) on proportionate basis to the retail investors.

Book Built Portion

The Book Built Portion would be available for allocation to wholesale investors. The investors are required to submit their bids through the syndicate members.

The procedure for Bidding is described in para on ‘Procedure’ below.

Fixed price portion

The present issue also contains a Fixed Price Portion, which will be equal to 10% of the Issue. Individual investors who for any reason(s) could not participate in the Book building Portion during the Bidding Period or did not receive an allocation from the Syndicate Member through whom they participated, can apply for equity shares out of the Fixed Price Portion. However, investors who have been successful in getting an allocation in the Book Built Portion are barred from applying for the Fixed Price Portion.

The equity shares to be offered under the Fixed Price portion shall be made available at the Issue Price.

Investors may note that in case of over subscription in the Fixed Price portion, allotment will be made on a proportionate basis, in consultation with the Regional Stock Exchange

The Fixed Price Portion shall be available for subscription during the Issue period and not during the Bidding period.
 
 

PROCEDURE FOR APPLICATION AND GENERAL INSTRUCTIONS

PROCEDURE FOR BIDDING IN THE BOOK BUILT PORTION

Dos

1. Check who can bid
2. Fill up the Resident Bid Form (Black and White) or Non-Resident Bid Form (Blue in colour) as the case may be
3. Fill up the Bid Form after reading the instructions carefully regarding

• Payment details
• Bank details
• Usual signatures
• PAN/Gir No.s
• DP details

1. Enter correct details of DP and Beneficiary Account. Allocation in Book Building is compulsory in demat form for institutional and non-institutional and optional for retail investors.
2. Submit bid at bidding centres only and obtain the Transaction Registration Slip (TRS) from the Syndicate Member
3. Bid Form should bear the stamp of the Syndicate Member, if not, the same would be rejected.
4. Submit the Revised Bid, if any, to the same Syndicate Member through whom the Original Bid was placed and obtain a revised TRS.

1. Do not bid for lower than the minimum bid size, i.e., 1050 shares in case of institutional category and non-institutional category. In case of retail category, do not bid for more than 1000 shares
2. Do not Bid for more equity shares than the size of the Issue/ limited prescribed by various regulatory authorities, as may be applicable.
3. A bidder should not bid on another form after his/her bids have been submitted to any Syndicate Member. The same may be rejected as multiple bidding.
4. Bid amount is not to be paid in cash, as the same may be rejected.
5. Bid forms are not to be sent by post and are to be hand delivered.

Bidders shall only use the Bid Form for the purpose of making a Bid in terms of this Draft Offer Document. The Bidder shall have the option to make a maximum of three Bids in their Bid Form and such options shall not be considered as multiple applications. On filling the Bid Form, the Bidder is deemed to have authorised the Company to make necessary changes in the Offer Document and the Bid Form as would be required for filing of Offer Document with the RoC and as would be required by the RoC after such filing, without any prior or subsequent notice of such changes to the Bidder.

Who Can Bid?

Under institutional category, bids can be made by QIBs, which has been defined by SEBI as under:

1. Public Financial Institution as defined in section 4A of the Companies Act, 1956;
2. Scheduled Commercial Banks;
3. Mutual Funds;
4. Foreign Institutional Investor registered with SEBI;
5. Multilateral and bilateral development financial institutions;
6. Venture Capital funds registered with SEBI.

1. Indian nationals resident in India who are majors, in single or joint names (not more than three)
2. Hindu Undivided Families in the individual name of the Karta

3. Non-Resident Indians (NRIs), Overseas Corporate Bodies (OCBs) on repatriation basis and non-repatriation basis subject to applicable laws.

4. Companies, Corporate Bodies and Societies registered under the applicable laws in India and authorized to invest in these shares
5. Trusts registered under The Societies Registration Act, 1860, or any other Trust law and are authorized under their constitution to hold and invest in shares

Only individuals (Karta to apply on behalf of HUF) applying upto 1000 shares, who have not participated in the Book Building or have not received any allocation in the Book Built portion.

Note: Book Running Lead Manager, Co-Book Running Lead Managers, Syndicate Members, any associate of the Syndicate Member (except AMC on behalf of Mutual Fund and Indian Financial Institutions and Public Sector Banks) shall not participate in the bidding process. Further, they shall not be entitled to subscribe to the issue in any manner except by virtue of devolvement, if any, on account of the underwriting obligations.

Procedure for Bidding

1. The Syndicate Members will circulate copies of the Offer Document to their clients.
2. Investors desirous to have copies of the Offer Document can obtain the same from the Registered Office of the Company or the BRLM/Co-BRLM or from the Syndicate Members.
3. The Company & the BRLM shall declare the Bid Opening Date and Bid Closing Date and publish the same in three widely circulated newspapers (one each in English, Hindi and regional language at the place where the Registered Office of the Company is situated). This advertisement shall contain the salient features of the Offer Document as specified under Form 2A, the method and process of bidding and the names and addresses of the syndicate members. The Syndicate Members shall start accepting Bids from the investors from the Bid Opening Date.
4. Investors who are interested in subscribing to the Company’s equity shares should approach any of the Syndicate Members or their authorized agent(s) to register their Bid.

5. The bids should be compulsorily submitted in the prescribed bid form only.

1. The Syndicate Member will register the Bids using the on-line facilities of NSE /BSE. There will be atleast one NSE /BSE on-line connectivity to each of the bidding centers.
2. NSE /BSE will offer a screen based facility for registering Bids for the Offer. This facility will be available on the terminals of Syndicate Members and their authorized agents during the Bidding Period. Syndicate Members can also set up facilities for off-line electronic registration of bids subject to the condition that they will subsequently download the off-line data file into the on-line facilities for book building on an half-hourly basis.
3. At the time of registering the Bid, the Syndicate Member shall enter the following details of the investor in the on-line system:

• Name of the investor
• The investor category - Individual/Corporate/NRI/OCB/FII/MF etc.
• Number of shares
• Bid price (See the following para)
• Bid Form number
• Whether payment made upon submission of bid form

1. After the above data is entered, the system will generate a Unique Transaction Identification Code (UTIC), which will indicate the Syndicate Member’s identity and the investor’s registration with him. A system generated Transaction Registration Slip (TRS) (or the Order Confirmation Note) will be given to the investor as a proof of the registration of each Bid option. The registration of the Bid by the Syndicate Member does not guarantee that the shares shall be allocated either by the Syndicate Member or the Company or the BRLM. Amount of margin charged from an investor shall be entered and printed in the TRS.
2. Such TRS by itself will not create any obligation of any kind.

6. Bids shall not be rejected except on technical grounds.

Bids can be rejected on technical grounds such as :-

1. the bid form is not as per the bid size applicable to that category
2. a bidder bids on another bid form after his/her bid on one bid form has been submitted to any syndicate member, the same would be rejected as a multiple bidding
3. the bid amount is paid in cash
4. the bid forms are sent by post
5. the bid form is not accompanied by a stamp of a syndicate member
6. the bid is at a cut-off price
7. the bid is not made in the appropriate bid/revision form
8. the bid is at below the floor price
9. the bid form is not signed
10. the bid form is not filled up in terms of the instructions therein.

Bids at Different Price Levels

1. A floor price level will be advertised prior to the Bid Opening Date for reference purpose of the Bidders. Such floor price will only be indicative, and the Company and the BRLM reserve the right to finalise the issue price at any level above the floor price without prior approval of or intimation of the Bidders.
2. Bidders will have an option to place their bids at a price which should be above the floor price. The Bidders cannot bid below the floor price of the equity shares of the Company.
3. All investors are required to indicate the price in their bids. Bidding at cut-off price shall not be allowed and such bids shall be treated as invalid.

The Company/BRLM and the Co-BRLMs who may be designated for this purpose shall open Escrow Accounts with one or more Escrow Collection Banks in whose favour the Bidder shall make out the cheque or demand draft in respect of his or her Bid and/or revision. The Escrow Collection Banks will act in terms of this Offer Document and an Escrow Agreement to be entered into between the BRLM, Co-BRLMs, the Company, the Escrow Collection Bank and the Registrars to the Offer. The monies in the Escrow Account shall be maintained by the Escrow Collection Bank for and on behalf of the Bidders. The Escrow Collection Bank shall not exercise any lien over the monies deposited therein, and shall hold the monies therein in trust for the investors, and on the Issue Opening Date transfer the monies to the Public Issue account with the Bankers to the Issue in terms of the Escrow Agreement. The Bidders are informed that the Escrow Mechanism is not prescribed by SEBI and the same has been established as an arrangement between the Escrow Collection Bank(s), the Company, the Registrars to the Issue and the BRLM, to facilitate collections from the Bidders.

Investors may please note that the Escrow account (for margin purposes) is not a mandatory requirement of SEBI. The margins collected shall be credited to the Escrow account. No part of the margin shall be held by the Syndicate Member. The Syndicate Member shall deposit the margins latest by the next day to the date of receipt of the bid along with the margin

Bidding and payment into the Escrow Collection Account

1. Each Bid Form will give the Bidder the choice to bid for up to three optional price and demand (i.e. number of shares bid for) levels. The price and demand options submitted by the Bidder in the Bid Form will be treated as optional demands from the Bidder and will not be cumulated. After discovery of the Issue Price, the maximum number of shares bid for by a Bidder at or above the Issue Price will be considered as his Bid during the allocation process and rest of the bid irrespective of the bid price will become automatically invalid.
2. The Bidder cannot bid on another Bid Form after his bids on one Bid Form have been submitted to any Syndicate Member. Submission of a second Bid Form to either the same or to another Syndicate Member will be treated as multiple bidding and is liable to be rejected either before entering the bid into the NSE/BSE bidding system, or at any point of time prior to the allotment of shares in the Offer.
3. Along with the Bid Form, all Bidders will submit a cheque or draft payable to the Escrow Account or Stockinvest (subject to applicable laws/guidelines) favouring the Company. The amount of such payment will be the highest value of the optional bids submitted in the Bid Form. If one of the Bidder’s options is at the cut off price, the payment will have to be considered at the highest price in the price band for that option. Margins collected from a bidder shall be credited to the escrow banker. No part of the margin shall be held by the syndicate member or realised to his credit. The syndicate member shall deposit the margins latest by the next day to the date of receipt of bid along with the margin.
4. The Syndicate Member will enter each option into the NSE / BSE bidding system as a separate bid and generate a TRS for each option and give the same to the Bidder. Therefore, a Bidder can receive up to three TRS’ for each Bid Form.

1. Bids registered by various Bidders through their Syndicate Member(s) shall be electronically transmitted to the NSE/BSE mainframe on an on-line basis.
2. The book gets built up at various price levels. This information will be available to the BRLM on an on-line basis.
3. During the Bidding Period, any Bidder who has registered his or her interest in the equity shares at a particular price level is free to revise his or her Bid using the printed Revision Form.
4. The revision can be made in both the desired quantity of shares and the Bid Price by using the Revision Form. The Bidder must fill his or her Bid Form number, details of all the options in his or her Bid Form or earlier Revision Form and revisions for all the options as per his Bid Form or earlier Revision Form. For e.g. if a Bidder has bid in three options in the Bid Form and he is changing only one of the options in the Revision Form, he must still fill the details of the other two options in the Revision Form as unchanged. Incomplete or inaccurate Revision Forms will not be executed by the Syndicate Member.
5. The Bidder can make this revision any number of times during the Bidding Period. However, for any revision(s) in the earlier Bid, the investor will have to use the services of the same Syndicate Member through whom he has placed the original Bid, otherwise the revised bid is liable for rejection.
6. Any revision of the Bid shall be accompanied by payment in the form of cheque or demand draft or Stockinvest shall be adjusted against the payment made at the time of the original Bid or the previously revised bid. The Syndicate Member may at his sole discretion waive the payment requirement at the time of one or more revisions.
7. When a Bidder revises his or her bid, he or she shall surrender the earlier TRS and get a revised TRS from the Syndicate Member. It is the responsibility of the Bidder to request for and get the revised TRS, which will act as proof of his or her having revised the previous Bid.
8. In case of discrepancy of data between NSE / BSE and the Syndicate Member, the decision of the BRLM based on the records of NSE / BSE is final and binding on all the parties concerned.

1. After the Bid Closing Date, the BRLM shall analyze the demand generated by the Syndicate at various price levels and discuss the pricing strategy with the Company.
2. The Company in consultation with the BRLM will finalize the "Issue Price", the number of shares to be issued. Thereafter , allocation will be done on discretionary basis to Institutional investors and on proportionate basis to Non-institutional and retail investors. The allocation to institutional investors would be decided based on investor quality, price aggression, early submission of bids, prior commitment etc..
3. The BRLM will, within 2 days of finalisation of the basis of allocation, advertise the basis of allocation for each category, which will be deemed to be notice of allocation to the bidder.
4. The BRLM shall intimate the Syndicate of the Issue Price and allocations to their Bidders.

In case of undersubscription in a category or inadequate demand at offer price in a particular category, excess subscription or demand will be spilled interse between other categories at the discretion of the BRLM/Co-BRLMs and the Company.

Signing of Underwriting Agreement & RoC Filing

1. The BRLMs/ Co-BRLMs have entered into an underwriting agreement with the Company on being intimated about the Issue Price and allocation(s) to their Bidders.The Syndicate Member(s) have, in turn, entered into an underwriting agreement with the BRLM and the Co-BRLMs.
2. The Offer Document would be finalised and filed with the RoC soon after signing of the Underwriting agreements. On filling the Bid Form, the Bidder is deemed to have authorised the Company to make necessary changes in the Offer Document and the Bid Form as would be required for filing the Offer Document with RoC and as would be required by RoC after such filing without any prior or subsequent notice of such changes to the Bidder.

After the Issue Price is determined by the Company in consultation with the BRLM, the statutory advertisement will be issued by the Company either prior to or after the filing of the Final Offer Document with the RoC. This advertisement shall in addition to the information that has to be set out in the statutory advertisement indicate the price of the securities along with a table showing the number of securities and the amount payable by an investor.

Issuance of Confirmation of Allocation Note and Allotment for the Book Built Portion

1. The BRLM/Co-BRLMs shall send to the Syndicate Members a list of their Bidders who have been allocated shares in the Book Built Portion.
2. The receipt of the list of allocation for their Bidders by the Syndicate Members shall constitute acceptance of the Bids set out in the said lists for the Issue and the same shall be deemed to be a valid and binding contract. The Bidders shall be deemed to have knowledge of such acceptance immediately upon the receipt by the Syndicate Members of the list of allocation for their Bidders. The Syndicate member is, for this limited purpose, deemed to be the agent of the Bidders.
3. The Syndicate Members would then send the CAN to their Bidders who have been allocated shares in the Book Built Portion and who have not paid into the Escrow Account at the time of bidding. Bidders who have been allocated shares and who have already paid into the Escrow Account at the time of bidding shall directly receive the CAN from the Registrars to the Issue subject, however, to realization of their cheques or demand drafts paid into the Escrow Account. In case of allocation of shares any excess amount paid on application of shares, shall be adjusted towards the amount due on allocation and the balance amount if any will be refunded by the Company to the applicants. In case the Issue price is higher than the highest value of the indicative price band used for Book Building, the Bidder who have paid lesser than the full value of their allocated shares at the Issue Price will be required to pay such shortfall as per the instructions given in the CAN.
4. Allotment of Equity shares relating to the Book Building portion shall be made within 15 days from the Issue closing date for Book Building Portion. The Company shall thereafter shall pay interest @ 15% p.a. (except to the applicants applying through stock invest) if allotment is not made and refund orders are not despatched to the investors within 15 days from the Issue closing date for Book Building Portion for any delay beyond 15 days.

Bidding Mechanism for Mutual Funds

The bidding mechanism and procedure for bids by Mutual Funds will be, mutatis mutandis, as applicable to the other categories of investors as stated earlier.

Multiple bids by Mutual Funds:

In case of bids by Mutual Funds, a separate bid form can be submitted in respect of each scheme of an Indian Mutual Fund registered with SEBI and that such bids shall not be treated as multiple bids, provided that the bid made by the Asset Management Company/Trustees/Custodians clearly indicate their intention as to the scheme for which the bid has been made.

Instructions for filling up the Bid Form

1. Bidders can obtain Bid Forms and/or Revision Forms from the Syndicate Members
2. Bids and revisions to Bids must be:

1. Made only in the prescribed Bid Form or Revision Form, as applicable, completed in full, in BLOCK LETTERS in ENGLISH in accordance with the instructions contained herein and in the Bid Form and are liable to be rejected by the Syndicate Member(s) if not so made.
2. For a minimum of 1050 shares and in multiples of 50 shares thereafter in case of institutional and non-institutional investors
3. For a minimum of 50 shares and in multiples of 50 shares upto 1000 shares in case of retail investors.
4. In single name or in joint names (nor more than three).
5. Thumb impressions and signatures other than in the languages specified in the Eighth Schedule in the Constitution of India must be attested by a Magistrate or a Notary Public or a Special Executive Magistrate under his or her official seal.

1. Bidder’s Bank Details: The name of the first or sole Bidder’s bank, branch, type of account and account number must be filled in the Bid Form. This is required for the Bidder’s own safety so that these details can be printed on the refund orders. Bids without these details are liable to be rejected.
2. Bidders Depository Account Details: The Allotment under the Book Building Portion (for the institutional and the non-institutional portion) shall be compulsorily in dematerialised form. The Bidders have to necessarily mention their Depository Participant’s name, DP-ID and Beneficiary Account Number in the Bid Form. Bid Forms without the depository account details will be rejected. In case of joint names, it must be ensured that the Depository Account is also held in the same joint names and which are in the same sequence in which they appear in the Bid Form.
3. Bids under Power of Attorney: In case of Bids made under Power of Attorney or by limited companies, corporate bodies, registered societies, etc. a certified copy of the Power of Attorney or the relevant resolution or authority, as the case may be or a duly certified copy thereof along with a certified copy of the Memorandum & Article of Association and/or Bye Laws must be lodged with the Syndicate Member along with the Bid form at the time of bidding.
4. Bids should bear the stamp of the syndicate member, failing which the same would be rejected.
5. Bids by NRIs, OCBs or FIIs on a repatriation basis:

1. Bid Forms and Revision Forms must be made only:
• On the prescribed Bid Form or Revision Form, as applicable, (Blue in colour) and completed in full in BLOCK LETTERS in ENGLISH in accordance with the instructions contained herein and in the Bid Form or Revision Form and are liable to be rejected by the Syndicate Member(s) if not so made;
• In a single or joint names (not more than three)
• In the names of individuals, societies and other corporate bodies owned predominantly (at least to the extent of 60%) by Non-Resident Individuals of Indian nationality or origin, or in the names of Foreign Institutional Investors but NOT in the names of minors, firms or partnerships, foreign nationals or their nominees. Bids by overseas limited companies and other corporate bodies owned predominantly (at least 60%) by Non Resident Indians must be accompanied by a certificate in the prescribed form OAC/OAC 1 from Overseas Auditor or Chartered Accountant or Certified Public Accountant.
2. Bids should bear the stamp of the syndicate member, failing which the same would be rejected.
3. The Company has received approval from RBI, vide its letter no. CO/FID(II)/5281/10.02.40(9049)99-2000 dt. 20^th April 2000 for the Issue of Equity Shares to FIIs on a repatriable basis upto 24% of the post issue capital.. Under the general permission granted by Reserve Bank of India, the Company is eligible shares to NRIs and OCBs under the 24% scheme. Thus, the Company can issue shares to NRIs/OCBs upto 24% of the issue size. However, the Company has restricted foreign holdings to the extent of 20% of its post-issue paid-up capital.
4. Hence, it will not be necessary for the investors to seek separate permission from RBI. The allotment of the equity shares to Non-Residents shall be subject to RBI approval or any other requisite authority as may be necessary under the existing Exchange Control Regulation. Sale proceeds of such investments in equity shares will be allowed to be repatriated along with the income thereon subject to the permission of RBI and subject to Indian Tax Laws provided the investments are made by inward remittances from abroad through approved banking channels or out of funds held in NRE or FCNR Account.
5. Refunds, dividends and other distributions, if any, will be payable in Indian Rupee only and net of bank charges and/or commission. In case of Bidders who remit money payable upon submission of the Bid Form or Revision Form through Indian Rupee Drafts from abroad, such payments in Indian Rupees will be converted into US Dollars or any other freely convertible currency as may be permitted by RBI at the rate of exchange prevailing at the time of remittance and will be despatched by Registered Post or if the applicants so desire, will be credited to their NRE Accounts, details of which should be furnished in the space provided for this purpose in the Bid Form. The Company will not be responsible for loss, if any, incurred by the Bidder on account of conversion of Foreign Currency into Indian Rupees and vice-versa.

1. Payment Instructions for Book Built Portion:

1. Cash payment will not be accepted by the Syndicate Members for the Book Built Portion. Payment may be made by way of cheque or Stockinvest (subject to applicable laws/guidelines) or demand draft drawn on any bank, including a Co-operative Bank which is situated at and is a member or sub-member of the Bankers Clearing House located at the place where the Bid Form or Revision Form is submitted. Outstation cheques or bank drafts, or cheques or bank drafts drawn on banks not participating in the clearing process will not be accepted. Bidders based in cities other than the bidding centers can give demand drafts payable at the location of the bidding center where the Bid Form or Revision Form is submitted. Such Bidders based in cities other than the bidding centers can submit their Bid Forms or Revision Forms only by hand delivery to the Syndicate Members. Bids sent by post will not be registered by the Syndicate Members.
2. All cheques or drafts must be made payable to the Escrow Collection Bank or Banks and favouring "Name of the Bank Escrow A/c NCL Book Building Offer" and crossed "A/C PAYEE ONLY". In case of payment by cheque or bank draft or Stockinvest (subject to applicable laws/guidelines), a separate cheque or bank draft or Stockinvest must accompany each Bid Form and Revision Form. Bidders are advised to mention the serial number of the Bid Form on the reverse of the instruments to avoid misuse of instruments submitted along with the Bids for equity shares.
3. Where the maximum Bid for equity shares by a Bidder is for the total value of Rs.50,000 or more, i.e. the actual number of securities bid for multiplied by the bid price, is Rs.50,000 or more the Bidder or in the case of a Bid in joint names, each of the Bidders should mention his or her Permanent Account Number (PAN) allotted under the Income-tax Act, 1961 or where the same has not been allotted, the GIR Number and the Income-Tax Circle/ Ward/ district. In case, neither the PAN nor the GIR number has been allotted, the Bidder must mention "Not allotted" in the appropriate place. Bid Forms without this information will be considered incomplete and are liable to be rejected.
4. All Bid Forms or Revision Forms duly completed and accompanied by Account Payee cheques or drafts or Stockinvest shall be submitted to the Syndicate Member at the time of submitting the Bid. The Syndicate Member may at his discretion waive the requirement of payment at the time of submission of the Bid Form and Revision Form.
5. No separate receipts shall be offered for the money payable on submission of Bid Form or Revision Form. However, the collection center of the Syndicate Member will acknowledge the receipt of the Bid Forms or Revision Forms by stamping and returning to the Bidder the acknowledgement slip. This acknowledgement slip will serve as the duplicate of the Bid Form for the records of the Bidder, apart from the TRS.

For further instructions, please read the Bid Form and/or the Revision Form carefully.

For NRIs, OCBs or FIIs applying on a repatriation basis:-

1. Bid Forms or Revision Forms from Non-Residents, duly completed along with cheque or bank drafts or Stockinvest, for the amount payable for Bidding or revisions remitted through normal banking channels or out of funds held in Non-Resident External (NRE) Accounts or Foreign Currency Non-Resident (FCNR) Accounts, maintained with banks authorized to deal in foreign exchange in India, along with documentary evidence in support of the remittance must be delivered to the Syndicate Member at the time of submission of the Bid Form or Revision Form. Payment will not be accepted out of Non-Resident Ordinary (NRO) Account of Non-Resident Bidders. Payment by drafts should be accompanied by Bank Certificate confirming that the draft has been issued by debiting to NRE or FCNR Account.
2. All cheques or Bank Drafts accompanying the Bid Form or Revision Form should be crossed A/c. Payee Only and made payable to the Escrow Account of the Escrow Collection Bank and marked "Name of the Bank Escrow A/c. NCL Book Building -NR". A separate cheque or bank draft must accompany each Bid Form or Revision Form. Under no circumstances should the Bid Form or Revision Form with remittance be sent to the Company or to the Registrars to the Offer.

The Bidder who is an individual or a Mutual Fund has the option to use the instrument Stockinvest in lieu of cash or cheques or bank drafts for payment of application money, subject to applicable laws/guidelines. The Bidder using Stockinvest should submit the Bid Form or Revision Form along with the instrument to the collection center of the Syndicate Member mentioned in the Bid Form. Stockinvest instruments are payable at par at all the branches of the issuing bank and as such, outstation Stockinvest instruments can be attached to the Bid Form or Revision Form.

The Bidder may approach the banks concerned for obtaining Stockinvest and detailed instructions for the same. The Bidder has to fill in the following particulars:

1. Title of the Account as mentioned in the Bid Form
2. Maximum number of Shares bid for
3. The maximum amount payable as per the options in the Bid Form or Revision Form

The Bidder should not fill in the portion to be filled up by the Registrars to the Issue (Right hand portion of the instrument). The Registrars to the Issue will fill up the Right-hand side of the Stockinvest indicating the Shares allotted to the Bidders, calculated as follows:

1. In case of full allotment, the Registrars will enter the number of shares on the right hand side equal to that on the left hand side of the instrument.
2. In case of partial allotment, Registrars will enter a number on the right hand side of the instrument, which will be less than the number filled up by the applicant on the left-hand side.
3. In case the allotment is nil, Registrars will enter ‘nil’ on the right hand side of the instrument.

The Purchaser should use the Stockinvest instrument within 10 days from the date of issue of the instrument, failing, which such Bids are liable to be rejected. For the purpose of calculating the 10 days, the last date for use of the Stockinvest for submitting the Bid Form to the Syndicate Member is indicated on the face of the Stockinvest with a notation "to be used before _____________".

The Registrars will not issue a refund order to the Bidders using Stockinvest for payment of money due under the Bid Form or Revision Form. In case of non allotment of Shares, the Registrars will return the cancelled Stockinvest instruments to the Bidders within 15 days of the Issue Closing Date for Book Built Portion, by Registered Post. The Bidder will have to approach the issuing bank branch for lifting the lien.

The Company through Resolution of the Board of Directors passed on the 10^th January 2000, has authorized the Registrars to the Issue to sign on behalf of the Company to realize the proceeds of the Stockinvest from the issuing bank or to affix non-allotment advice on the instrument, or to cancel the Stockinvest(s) of the non-allottee. The Registrars shall directly send back such cancelled Stockinvest(s) to the Bidders.

Reserve Bank of India vide its circular no. DBOD No.FSC.BC.100/24.47.001/94 dated September 2, 1994 has restricted the use of Stockinvest(s) to individual investors and Mutual Funds only. Stockbrokers, Corporate Bodies, Banks and Financial Institutions are not allowed to apply through Stockinvest(s). A ceiling of Rs.50,000/- per individual per Stockinvest has been imposed. The above ceiling is not applicable to Mutual Funds.

In the interest of the investors, to avoid rejection of applications on technical grounds, it is suggested that the applicant should ensure that :

1. the date of issue of the stockinvest by the issuing bank is clearly mentioned on the instrument
2. the instrument is duly signed by the authorised officer of the bank giving his code number
3. any correction / alteration in the date of issue, amount, the name of the Issuer, etc., should be attested by an authorised officer of the issuing bank
4. the applicant has clearly written the name of the Issuer, the amount and signed the instrument. The signature on the instrument should tally with the specimen signature of the first named applicant as appearing on the application form
5. in case the stockinvest is purchased in joint account, the names of both the account holders should be mentioned in the stockinvest instrument at the place mentioned for writing the name of the investor the amount written in the application form to be deposited and the amount of the instrument should be the same.

Disposal of Application Money in Case of Stockinvest

In case of non-allotment, the Registrars to the Issue shall directly send back the cancelled Stockinvest to the Bidders along with the relative advice. The Stockinvest would bear stamps such as "CANCELLED" and "NOT ALLOTTED" across the face of the instrument. The issuing bank will lift the lien on the account on surrender of the same by the Bidder.

On allotment or partial allotment, the Registrars to the Issue shall fill in the amount (which will be less than or equal to the amount filled by the Bidder) before presenting the Stockinvest to the respective issuing Banker for payment to the extent of allotment. The Bank will lift the lien on the balance amount, if any, of the deposit.

Inquiries relating to Stockinvest may be addressed only to the Registrars to the Issue and not to the issuing bank. The above information is given for the benefit of Bidder and the Company is not liable for any modification of terms of Stockinvest or procedure thereof by issuing banks.

The Registrars shall send back the cancelled instrument to the Bidders directly by registered post within 15 days of closure of the bidding.

All conditions mentioned earlier for making a Bid through cheques or demand drafts will also apply to Bids made with Stockinvest.

For further instructions, please read the Bid Form carefully.

Allotment

After the Company have received the entire Issue proceeds for the Book Built Portion, it will proceed to complete the allotment formalities for the Book Built Portion. The allocation under Book Built Portion will be compulsorily under dematerialsed form for institutional investors and non-institutional investors. The bidders may have it rematerialised later. In case of retail investors, the allocation will be either in physical or in dematerialised form, at the option of the retail investors. After allotment, all bidders will receive credit for the shares directly in their depository account and share certificates will be despatched to those retail investors, who have opted for shares in physical form.

Fixed Price Offer

Who Can Apply

Only individual investors, including NRIs, can apply in the Fixed Price portion. Applications by HUFs would be treated under "individual" category.

Applications not to be made by

1. Minors
2. Foreign Nationals
3. Persons who have got an allocation in the book built portion

Availability of Offer Document and Application Forms : Application forms for the Fixed Price Portion along with the copies of the Offer Document and/or Abridged Offer Document may be obtained from the Registered Office of the Company, from BRLM, Co- BRLMs and at the collection centres of the Bankers to the Issue.

1. Applications must be:

1. Made only in the prescribed Application Form, as applicable, completed in full, in BLOCK LETTERS in ENGLISH in accordance with the instructions contained herein and in the Application Form and are liable to be rejected if not so made.
2. For a minimum of 50 shares and in multiples of 50 shares thereafter.
3. In single name or in joint names (nor more than three).
4. Thumb impressions and signatures other than in the languages specified in the Eighth Schedule in the Constitution of India must be attested by a Magistrate or a Notary Public or a Special Executive Magistrate under his or her official seal.

3. Bank Account Details of Applicant: The name of the applicant’s Bank, type of account and account number must be filled in the Application Form. This is required for applicants’ own safety and these details will be printed on the refund orders, if any. Applications without these details would be treated as incomplete and are liable to be rejected.
4. Applicant's Depository Account Details: The investor has an option to get his shares using the Depository mode. Investors desirous of availing of this facility should mention their Depository Participant’s name, DP-ID and Beneficiary Account Number in the Application Form. In case an applicants seeks allotment of certain number of shares in dematerialised form and the remaining in physical form, these would be clubbed for the purpose of arriving at the basis of allocation. Further it may be noted that the allotment of shares would be first be done in the electronic form and then in the physical form. However, if the same applicant submits two applications one for physical shares and the other for shares in dematerialised form, such applications will be treated as multiple applications and are liable to be rejected. In case of Applications submitted in joint names, it must be ensured that the Depository Account is also held in the same joint names and which are in the same sequence in which they appear in the Application Form
5. Applications under Power of Attorney: In case of applications under Powers of Attorney a certified copy of the Power of Attorney must be lodged separately at the office of the Registrars to the Issue simultaneously with the submission of the application form, indicating the serial number of the application form and the name of the Bank and the branch office where the application is submitted.
6. PAN/ GIR Number: Where an application is for a total value of Rs. 50,000 or more, the applicant or in case of applications in joint names, each of the applicants should mention his/ her/ their Permanent Account number (PAN) allotted under Income Tax Act, 1961 or where the same has not been allotted, the GIR Number and the IT Circle/ Ward/ District. In case where neither the PAN nor the GIR Number has been allotted, or the applicant is not assessed to Income Tax, the appropriate box provided for the purpose in the application form must be ticked. Applications without this will be considered incomplete and are liable to be rejected.
7. Joint Applications in the case of individuals: Application can be in single or joint names (nor more than three). In the case of joint application, all payments will be made out in favour of the first applicant. All communications will be addressed to the first named applicant whose name appears in the Application form at the address mentioned therein.
8. Multiple Applications: An applicant should submit only one application form (and not more than one) for the total number of equity shares applied for. Two or more applications in single or joint names will be deemed to be multiple applications if the sole and/ or first applicant is one and the same.

Applicants are requested to write their names and application serial number on the reverse of the instruments by which the payments are being made to avoid misuse of instruments submitted along with the applications for equity shares.

Applications by NRIs on non-repatriation basis can be made using the Form meant for Public (white in colour) out of the funds held in Non Resident (Ordinary) Account (NRO). The relevant bank certificate must accompany such forms. Such applications will be treated on par with the applications made by the public.

Payment Instructions for the fixed price portion

1. Payment may be made by way of cash or cheque/ demand draft/ Stockinvest (money/ postal orders will not be accepted) drawn on any Bank, including a co-operative Bank which is situated at and is a member or sub-member of the Banker’s clearing-house located at the place where the application form is submitted, i.e. at designated collection centres.
2. Outstation cheques/demand drafts drawn on Banks not participating in the clearing process will not be accepted.
3. All cheques/ demand drafts accompanying the Application Form should be marked as follows: Cheque/ bank draft must be made payable to the bankers to the issue and marked "A/c NCL – Public Issue" and crossed "A/C payee only". For e.g. "Name of the Bank– A/c NCL – Public Issue"
4. All Stockinvests should be made payable to "Name of the Bank A/c NCL – Public Issue." and crossed "A/C PAYEE ONLY".
5. The applications shall be made only by way of cash/ cheque/ demand draft/ Stockinvest. However, if the amount payable on application is Rs. 20,000 or more, such payment must be effected only by way of an account payee cheque/ Stockinvest or Bank draft in terms of section 269SS of the Income-Tax Act, 1961. Otherwise the applications may be rejected and application money refunded without any interest.

• On the prescribed application Form, as applicable, (Blue in colour) and completed in full in BLOCK LETTERS in ENGLISH in accordance with the instructions contained herein and are liable to be rejected if not so made;
• In a single or joint names (not more than three)

• Application Forms from Non-Residents, duly completed along with cheque or bank drafts or Stockinvest, for the amount payable remitted through normal banking channels or out of funds held in Non-Resident External (NRE) Accounts or Foreign Currency Non-Resident (FCNR) Accounts, maintained with banks authorized to deal in foreign exchange in India, along with documentary evidence in support of the remittance must be delivered to the designated branches of the Bankers to the Offer. Payment by drafts should be accompanied by Bank Certificate confirming that the draft has been issued by debiting to NRE or FCNR Account.

• All cheques or Bank Drafts accompanying the Application Form should be crossed A/c. Payee Only and made payable to the Escrow Account of the Escrow Collection Bank and marked "Name of the Bank Escrow A/c. NCL Public Issue-NR". A separate cheque or bank draft must accompany each Application Form. Under no circumstances should the Application Form with remittance be sent to the Company or to the Registrars to the Offer.

• details of which should be furnished in the space provided for this purpose in the Application Form. The Company will not be responsible for loss, if any, incurred by the Applicant on account of conversion of Foreign Currency into Indian Rupees and vice-versa.

Payment by Stockinvest

Applicants, being Individuals and Mutual Funds only, have the option of using the "Stockinvest" instrument for payment of application money in lieu of cash/ cheque/ demand draft. Applicants using Stockinvests should submit them along with the application form to any of the collecting centres/ Bankers to the Issue mentioned in the application form. Stockinvests should be payable at par at all the branches of the issuing Bank and as such outstation Stockinvests can be attached to the application forms. Applicants can approach the Banks concerned for obtaining Stockinvest and detailed instructions for the same.

The applicant has to fill in the following particulars:

1. Title of the Account as mentioned in the Application Form.
2. Number of equity shares applied for.
3. The amount payable on the equity shares applied for:

1. In case of full allotment, the number of equity shares on the right-hand side will be the same as that on the left-hand side of the instrument;
2. In case of partial allotment, the number filled up by the Registrars to the Issue on the right-hand side of the instrument will be less than the number filled up by the applicant on the left-hand side;
3. In case the allotment is nil, the number filled up by the Registrars to the Issue on the right-hand side of the instrument will be nil.

The Stockinvest instrument should be used by the Purchaser within 10 days from the date of the issue of the instrument, failing which such applications are liable to be rejected. For the purpose of calculating the 10 days, the last date for use of the Stockinvest for submitting the Application Form to the Bankers to the Issue is indicated on the face of the Stockinvest with a notation "to be used before -------------------------".

No refund order will be issued to the applicants using Stockinvest for payment of application money. In case of non-allotment of equity shares, the cancelled Stockinvest instruments will be returned to the applicant, within 15 days of closure of subscription list by Registered Post/ Speed Post. The applicant will have to approach the issuing Bank branch for lifting the lien.

Registrars to the Issue have been authorised by the Company (through Resolution of the Board of Directors passed at its meeting held on the 10^th January 2000, to sign the Stockinvests on behalf of the Company, to realise the proceeds of the Stockinvest from the issuing Bank, or to affix non-allotment advice on the instrument, or to cancel the Stockinvest(s) of the non-allottee. Such cancelled Stockinvest(s)shall be sent back by the Registrars directly to the investors. The currency of the Stockinvest is four months.

Reserve Bank of India, vide its circular DBOD No. FSC.BC.100/24.47.001/94 dated September 2, 1994, has restricted the use of Stockinvest(s) to individual investors and Mutual Funds only. Brokers, Corporate Bodies, Banks and Financial Institutions are not allowed to invest through Stockinvest(s). A ceiling of Rs. 50,000/- per individual per Stockinvest by Banks has been imposed. The above ceiling is not applicable to Mutual Funds.

In the interest of the investors, to avoid rejection of applications on technical grounds, it is suggested that the applicant should ensure that

• The date of issue of the Stockinvest by the issuing bank is clearly mentioned on the instrument
• The instrument is duly signed by the authorised officer of the bank giving his code number
• The instrument bears the code number and the address of the issuing bank branch
• Any correction/ alteration in the date of issue, amount, the name of the issuer (i.e. Nimbus Communications Ltd.), etc. should be attested by an authorised officer of the issuing bank
• The applicant has clearly written the name of the issuer, the amount and signed the instrument
• Amount written in the application form to be deposited and the amount of the instrument accompanying the application form should be the same

Submission of completed application forms

All applications duly completed and accompanied by cash/ cheques/ demand drafts/ Stockinvests shall be submitted at the branches of the Bankers to the Issue (listed in the Application Form) before the closure of the Issue. Applications should NOT be sent to the Office of the Company or to the BRLM & Co-BRLMs to the Offer.

Application Forms along with Bank Drafts payable at Mumbai can also be sent by registered post with acknowledgement due to the Registrars so that the same can be received before the closure of the subscription list.

No separate receipts will be issued for the application money. However, the Bankers to the Issue or their approved collecting branches receiving the duly completed application form will acknowledge receipt of the application by stamping and returning to the applicant the acknowledgement slip at the bottom of each application form.

Applications shall be deemed to have been received by the Company only when submitted to the Bankers to the Issue at their designated branches or on receipt by the Registrars as detailed above and not otherwise.

For further instructions, please read the application form carefully.

Applications by Employees and Working Directors of the company

Out of the offer, 2,00,000 equity shares have been reserved for allotment to employees on a competitive basis.

1. Applications must be made only in the specified (pink colour) form, and completed in Full in Block Letters in English as per the instructions contained herein and in the application form and are liable to be rejected if not so made.
2. The first applicant must be a permanent employee/ Working Director of the Company
3. Applications should be for a minimum of 50 Equity Shares and in multiples of 50 thereafter
4. Applications must be in single or joint names (not more than three)
5. All cheques/ bank drafts must be made payable to the Bankers to the Issue with whom the application is lodged and marked ‘A/c NCL Equity - Employees’ and crossed ‘Account Payee only’ such as ‘Name of the Bank A/c NCL Equity- Employees’. In case of payments made by cheque or bank draft or stockinvest, a separate cheque or bank draft or stockinvest must accompany each Application Form.
6. Other terms and conditions mentioned under ‘Application by Indian Public’ shall apply mutatis mutandis.

schedule and basis of allotment

The basis of allotment will be finalised in consultation with the Mumbai Stock Exchange, which is the Regional Stock Exchange. For details of the basis of allotment, investors are advised to refer to Part II of the Offer Document.

Acceptance of Applications

The Company reserves the right to accept or reject, any application, in whole or in part, without assigning any reason thereof. If the application is rejected in full, the whole of the application money received will be refunded by Registered Post to the applicant. If the application is accepted in part, the excess application money after adjusting for the amount payable on allotment will be refunded to the applicant. Such refund, if any, will carry interest @ 15% p.a. after 15 days from the closure of the Issue for the period of delay beyond 15 days.

Dematerialisation

The equity shares of the Company have been admitted for dematerialisation by National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) vide a tripartite agreement dated 6^th April 2000 , signed between the Company, NSDL and the Registrar. A similar agreement dated 22^nd March 2000 has been signed between the Company, CDSL and the Registrar, to enable all shareholders of the Company to have their shareholding in electronic form.

• An applicant has the option of seeking allotment of Equity Shares in electronic or in physical mode. However, for investors applying in 60% institutional and 15% non-institutional category, allotment will be in compulsory dematerialised form.
• Separate applications for electronic and physical shares by the same applicant shall be considered as multiple applications.
• The applicant seeking allotment of shares in the electronic form must necessarily fill in the details (including the beneficiary account number and Depository Participant’s ID number) appearing under the head "Request for shares in electronic form. An applicant who wishes to apply for shares in electronic form must have at least one beneficiary account with any of the Depository Participants (DPs) of NSDL or CDSL, registered with SEBI, prior to making the application. Shares allotted to an applicant in the electronic account will be credited directly to the respective beneficiary account.
• For subscription in electronic form, names in the share application form should be identical to those appearing in the account details in the depository. In case of joint holders, the names should necessarily be in the same sequence as they appear in the account details in the depository.
• Non-transferable allotment letters/ refund orders will be directly sent to the applicant by the Registrar to this Issue.
• Investors, in their own interest should verify that correct details of DP and beneficiary account are given in the bid form/ application form. In case the information is incorrect or insufficient, the issuer would not be liable for losses, if any. In case of the fixed price portion, incorrect or insufficient, the application form will be assumed as an application for shareholding in physical form.
• Investors, while making the application in joint names in the dematerialised form should have the dematerialised account in the same sequence as mentioned in the application form.
• The applicant is responsible for the correctness of the applicant’s demographic details given in the application form vis-à-vis those with his/ her DP.
• In case of partial allotment, allotment will be done in dematerialised mode for the shares sought in dematerialised form and balance, if any will be allotted in physical form.
• Trading in the shares shall be in dematerialized form only.
• It may be noted that the electronic shares can be traded only on the Stock Exchanges having electronic connectivity with NSDL and CDSL.

The Bidder or applicant will fill up the Depository Instruction Section in the Bid Form or Application Form which will authorise the Company to allot shares to him in the Electronic form

The Bidder or applicants may apply for a part of shares in dematerialised form and the balance in physical form. This should be indicated under the heading "Request for shares in Electronic Form" in the Bid/Application Form.
 
 
 
 

1. TAX BENEFITS

Benefits to the Company

INCOME TAX

(a) The Company in accordance with and subject to the condition and to the extent specified in Section 80 HHF of the Act would be entitled to deduction, in computing the total income of the Company, of the profits derived by the Company from the business of export or transfer by any means out of India of any film software, television software, music software, television news software, including telecast rights (software or software rights). The profits derived from the above referred export activities shall be the amount, which bears to the profits of the business, the same proportion as the export turnover bears to the total turnover of the business carried on by the Company. This deduction is available from the assessment year 2000-2001.

Benefits to the Shareholders

INCOME TAX

2. Under section 10(33) of the Act, the dividend received by the shareholders is totally exempt from tax.
3. As per section 112 of the Act, W.E.F. April 1,1999, the tax on the long term capital gains arising on sale of listed security will be lower of 10% of capital gains (computed without indexation benefits) or 20% of capital gains (computed with indexation benefits)
4. In case of a shareholder, being an individual or a Hindu undivided family, in accordance with and subject to the conditions and to the extent specified in section 54F of the Act, the shareholders would be entitled to long term capital gains on the sale of their shares in the company.
5. In accordance with section 115 AD (1) of the Act, notified foreign institutional investors who are members of the company will subject to other conditions prescribed, be subjected to concessional rates of 10% on long term capital gain and 30% on short term capital gains arising on the transfer of shares held in the company.
6. In case of a shareholder, being a Non-Resident Indian, in accordance with and subject to the conditions and to the extent specified in section 115F of the Act, the Non-Resident Indian shareholders would be entitled to exemption from long term capital gains on the sale of their shares in the company.
7. In accordance with and subject to the conditions and to the extent specified in section 54EC of the Act, the shareholders would be entitled to exemption from long-term capital gains on sale of their shares in the company with effect from the assessment year 2001-2002.

The total exemption from wealth tax would be available on investment in shares of the company.

GIFT TAX

Effective from October 1, 1998, no gift tax shall be levied on gift of shares of the company.

1. PARTICULARS OF THE ISsue

1. To finance the Company's expansion and diversification plans, as given below:

• Expansion of existing core business areas which include media marketing and acquisitions and television content creation.
• Investment in overseas joint venture for live sports events production , distribution and management
• Investment in the subsidiary, Nimbus Online Private Limited.
• Web solutions, development equipment
• Foray into television and radio broadcasting through 2 television channels and 3 FM radio stations
• Motion picture production projects and music software releases.
• Other investments which include production, post-production, graphics, transmission chain and uplinking equipment etc., setting up the required infrastructure

1. Refund of the part consideration paid by Transatlantic Corporation Limited for purchase of 12 lacs equity shares of Rs. 10/- each of NCL aggregating Rs 34.32 crores.
2. Listing of the equity shares of the Company at the stock exchanges
3. Meeting the expenses of the Issue

Transatlantic Corporation Limited, an Overseas Corporate Body, had agreed vide its letter dated the 11^th May 2000 to purchase of 12 lacs equity shares of Rs. 10/- each of NCL at a price of Rs. 360/- per share, comprising of Rs. 10/- as face value of each equity share and Rs. 350/- as premium per equity share aggregating Rs.43.20 crores. Transatlantic have, with permission of the RBI till September 20^th, 2000, paid Rs.34.32 crores towards part consideration for the above purchase.

Transatlantic Corporation Limited and Nimbus Communications Limited, have now mutually agreed to cancel the transaction of purchase of 12 lacs equity shares of Rs.10/- each of NCL, at the request of Transatlantic, vide an agreement dated September 20^th , 2000. This amount of Rs.34.32 crores is shown as "Share Application Money- Refund Account" in the Company’s books.

Out of Rs.34.32 crores received from the M/s Transatlantic Corporation Limited, an amount of Rs. 31.17 crores was deployed towards the Company’s expansion and diversification plans as on 15^th December, 2000, as outlined above.

The balance amount of Rs. 3.15 crores has been placed as deposits by the Company and will be deployed in the project by the Company. The amount of Rs. 34.32 crores would be refunded to M/s Transatlantic Corporation Limited out of the proceeds of the issue.

The Main object clause of the Memorandum of Association of the Company enables the Company to undertake the activities for which the funds are being raised in the present Issue. The activities which the Company is carrying on until now are in accordance with the object clause of the Memorandum of Association of the Company.
 
 

Fund Requirements

The fund requirements and use of proceeds are based on the estimates of the Company and are not appraised by any bank/ financial institution.

Details of the fund requirements for various activities, as estimated by the Company, are as under:
 

Particulars	Amount  (Rs. in crores)	Total Amount  (Rs. in crores)
Expansion of existing core business
Media, marketing and acquisition	9.33
Television content, and events including studio facilities	23.93
Sports events management ,production , acquisition, marketing and telecasting	9.87	43.13
Investment in businesses that are at the product development stage and new activities
Information Technology Areas
Investment in Nimbus Online Pvt. Ltd., a subsidiary Company) (Internet and e-commerce project being set up by NOPL, which is at product development stage)	20.15
Traditional Media and Entertainment Industry Areas
Television broadcasting	48.72
Production, post production, graphics, transmission chain, playout and uplinking equipment	9.14
FM radio stations#	13.89
Motion pictures	7.91
Music Software	2.69	82.35
Others
Web solutions development equipment and software	2.98
Infrastructure	17.94
Issue expenses	7.50
Contingencies (@4.5%)	8.20	36.62
TOTAL	182.25	182.25

Out of Rs.34.32 crores received from the M/s Transatlantic Corporation Limited, an amount of Rs. 31.17 crores was deployed towards the Company’s expansion diversification plans as on 15^th December, 2000, as outlined above.

The balance amount of Rs. 3.15 crores has been placed as deposits by the Company and will be deployed in the project by the Company. The amount of Rs. 34.32 crores would be refunded to M/s Transatlantic out of the proceeds of the issue.

#Please refer to Risk Factor No. 15 on Page no. X of the Draft Offer Document for details .

Statement showing funds deployed as on 30^th September , 2000 on the proposed business activity
 

Business Activity	Amount (Rs. in Lacs)
Media Marketing and Acquisition	797.35
Television Content, Ad films and events	845.75
Sports Events	31.61
Motion Pictures	61.58
Internet Content	277.50
Broadcast	26.12
Music	6.83
FM Radio	180.20
Web Solutions, Development Equipment and Software	25.94
Infrastructure	239.79
IPO expenses	89.02
TOTAL	2581.69

Sources of funds
Share application money	2482.48
Internal accruals	99.21
	2581.69

Means of Finance

The entire fund requirement of the projects, as detailed above, is proposed to be financed through this Public Issue.

Schedule of deployment of funds

(Rs. in crores)
 

Particulars	2000-01	2001-02	2002-03	Total
Expansion of existing core business
Media Marketing and Acquisition	9.33			9.33
Television content, and events including studio facilities	13.50	10.43		23.93
Sports events management, production, acquisition, marketing and telecast	1.50	8.37		9.87
Investment in businesses that are at the product development stage and new activities				0
Information Technology Areas				0
Investment in Nimbus Online Pvt. Ltd.(NOPL), a subsidiary Company  (Internet and e-commerce project being set up by NOPL)	3.50	16.65		20.15
Traditional Media and Entertainment Industry Areas				0
Television broadcasting	1.85	46.87		48.72
Production, post production, graphics, transmission chain, playout and uplinking equipment	1.50	7.64		9.14
FM radio stations		13.89		13.89
Motion pictures	0.92	6.99		7.91
Music Software	0.45	2.24		2.69
Others				0
Web solutions development equipment and software	0.46	2.52		2.98
Infrastructure	2.60	15.34		17.94
Issue expenses	7.50			7.5
Contingencies				8.2
TOTAL	43.11	130.94		182.25

As mentioned above, an amount of Rs. 34.32 crores is proposed to be refunded to M/s Transatlantic Corporation.

Pending deployment of funds towards various objects of the issue, the funds would be deployed in liquid instruments. Such investment would be duly authorised by the Board of Directors or a Committee thereof specifically set up and duly empowered in this regard. In the event of shortfall of funds raised, the Company would augment the same through internal accruals and/ or raise fresh loans.

1. COMPANY INFORMATION AND MANAGEMENT

One of the early entrants in the Media and Entertainment Industry, the Nimbus Group has been in the area of airtime sales and content creation for over a decade. The Company has a television content library of 3678 hours as on 15^th August 2000 consisting of soaps operas, drama serials, comedies, cartoon series, film formatted shows, music based shows, sports programmes, sports events, etc. The Company has multi channel, multi lingual, multi genre and multi time band products in its portfolio.

The Company was incorporated on 30^th June 1987 as a Private Limited Company and became a Deemed Public Limited Company on 1^st July 1994. The Company was converted into a Public Limited Company on the 4^th January 2000. The Company has been promoted by Shri Harish Thawani, who has 20 years of experience in this industry.

Some of the Company's notable achievements are:

• In air time marketing the company has operated on most of the major television channels that work on a time barter business model, both nationally as well as in the regional language markets.
• In the air time marketing sector, the Company has experience in multiple genres, ranging from serials to films to sports events to awards ceremonies to children’s programmes to news and current affairs.
• Nimbus is the only Company in India to have twice secured exclusive rights to market the entire air time for the Cricket World Cup, in 1992 and in 1999.
• Nimbus is the only Company in India to have twice won rights to market the entire airtime for the telecasts of the Central Budget as well as the Election Specials.
• The Company was exclusively responsible for the entire live feed customisation of the 1999 Cricket World Cup, including Daily News and Tour Diary, has produced preview series for the 1992 Olympics, the 1996 and 1999 Cricket World Cups and a host of other sports shows. It was responsible for the entire India feed of the 1998 Asian Games.
• The Company has successfully marketed products in 9 languages, over national, metro as well as regional networks, including notable successes such as Nukkad, Fauji, Kakkaji Kahin, Sunil Gavaskar Presents, Maine Pyar Kiya, Shaan, and dozens of others.
• The Company has successfully launched on Indian television various programmes , such as film based countdown shows, syndication with the 1996 World Cup Countdown, Indian language dubs of cartoons with the Jungle Book series, airing of blockbuster films on television with 'Maine Pyar Kiya'.

• The Company currently produces over 18.5 hours of original language programmes and airs over 25.5 hours of own and acquired programmes every week.The Company has produced and telecast several successful programmes on various channels, which are borne out by the ratings attained by them, some of which are #1 ratings.

Some of the notable achievements of NCCL are as under:-

• NCCL introduced the concept of music countdown shows on Indian television, with its own production Superhit Muqabla, which became one of the biggest hits ever on television and also achieved the No 1 ratings position (see table below)

• The Company's programmes include Nyay (daily drama series on DD Metro), Needhi (daily soap opera on Sun TV), Ahaliya (daily soap opera on Surya TV), Super 7 Muqabla (music countdown show on Zee TV), Agni (daily soap opera on DD National Network), Neethichakra (daily soap opera on Udaya TV). ), Ashakya (daily bsoap opera on Mumbai DD Kendra), Top Ten Tamasha( weekly countdown on DD National Network). (See tables below for ratings of some of the serials).