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Letter of Offer Dated March 19, 2010
For Equity Shareholders of the Company only
HINDUJAFOUNDRIESLIMITED
(OurCompanywas initially incorporatedasaprivate limitedcompanyonJuly30,1959asEnnoreFoundriesPrivateLimitedunder theCompaniesAct,1956, in the stateofTamilNadu.OurCompany subsequently changed status toapublic limitedcompanyfromMarch28,1961onwards.ThenameofourCompanywaschangedtoHindujaFoundriesLimitedfromFebruary14,2008.)
RegisteredOffice:KathivakkamHighRoad,Ennore,Chennai600057.Tel:(+9144)25752103;Fax:(+9144)25750390,Website:www.hindujafoundries.com
ContactPerson:Mr.N.Kothandapani,CompanySecretaryandComplianceOfficer;Email:[email protected]
FORPRIVATECIRCULATIONTOTHEEQUITYSHAREHOLDERSOFOURCOMPANYONLY
ISSUEOF10,055,749EQUITYSHARESWITHAFACEVALUEOFRS.10EACHATAPREMIUMOFRS.40PEREQUITYSHARE FORANAMOUNTAGGREGATINGRS. 5,027.87 LAKHONARIGHTSBASISTOTHE EXISTING EQUITYSHAREHOLDERSOFHINDUJAFOUNDRIESLIMITED (COMPANY) INTHERATIOOF7EQUITYSHARE(S)FOREVERY13FULLYPAIDUPEQUITYSHARE(S)HELDBYTHEEXISTINGEQUITYSHAREHOLDERSONTHERECORDDATE,FEBRUARY4,2010.THEISSUEPRICEIS5TIMESTHEFACEVALUEOFTHEEQUITYSHARES.FORFURTHERDETAILS,PLEASESEETHESECTIONTITLEDTERMSOFTHEISSUEONPAGE197OFTHISLETTEROFOFFER.
GENERALRISKInvestmentsinequityandequityrelatedsecuritiesinvolveadegreeofriskandInvestorsshouldnotinvestanyfundsinthisIssueunlesstheycanaffordtotaketheriskoflosingtheirinvestment.InvestorsareadvisedtoreadtheRiskFactorscarefullybeforetakinganinvestmentdecisioninthisIssue.Fortakinganinvestmentdecision,InvestorsmustrelyontheirownexaminationoftheIssuerand theIssue including therisks involved.Thesecuritiesbeingoffered inthisIssuehavenotbeenrecommendedorapprovedby the Securities andExchangeBoardof India (SEBI)nordoes SEBI guarantee the accuracy or adequacy of thisdocument.InvestorsareadvisedtorefertosectiontitledRiskFactorsonpageXIIofthisLetterofOfferbeforemakinganinvestmentinthisIssue.
OURCOMPANYSABSOLUTERESPONSIBILITYWehavingmadeallreasonableinquiries,acceptresponsibilityforandconfirmthatthisLetterofOffercontainsallinformationwithregardtousandtheIssue,whichismaterialinthecontextofthisIssue,thattheinformationcontainedinthisLetterofOfferis true and correct in allmaterial respects and is notmisleading in anymaterial respect, that the opinions and intentionsexpressedhereinarehonestlyheldandthattherearenootherfacts,theomissionofwhichmakesthisLetterofOfferasawholeoranysuchinformationortheexpressionofanysuchopinionsorintentionsmisleadinginanymaterialrespect.
LISTINGOur existing Equity Shares are listed on Bombay Stock Exchange Limited (BSE),National Stock Exchange of IndiaLimited(NSE)andMadrasStockExchange(MSE).OurGDRsarelistedontheLuxembourgStockExchange.Wehavereceived inprinciple approvals fromBSE,NSE andMSE for listing theEquity Shares arising from this Issuevide lettersdatedSeptember11,September17andSeptember9,2009,respectively.TheDesignatedStockExchangeforthisIssueisBSE.LEADMANAGERTOTHEISSUE REGISTRARTOTHEISSUE
HDFCBankLimitedInvestmentBankingDivisionProcessHouse,GroundFloor,KamalaMillsCompound,SenapatiBapatMarg,LowerParel(W),Mumbai400013Tel:(+9122)40804108;Fax:(+9122)40804114ContactPerson:Mr.PareshSoniEmail:[email protected]:[email protected]:www.hdfcbank.comSEBIRegistrationNo.:INM000011252
IntegratedEnterprises(India)Limited2ndfloor,KencesTowers1,RamakrishnaStreetNorthUsmanRoad,TNagar,Chennai600017Tel:(+9144)281408013,Fax:(+9144)28142479ContactPerson:Mr.SureshBabuEmail:[email protected]:www.iepindia.comSEBIRegistrationNo.:INR000000544
ISSUEPROGRAMME
ISSUEOPENSONLASTDATEFORREQUESTFORSPLITAPPLICATIONFORMS ISSUECLOSESON
March 27, 2010 April 03, 2010 April 10, 2010
mailto:[email protected]://www.hdfcbank.com/http://www.iepindia.com/
I
TABLEOFCONTENTS
CHAPTERS PageNo. SECTION1GENERAL
DEFINITIONSANDABBREVIATIONS IINOTICETOOVERSEASSHAREHOLDERS VIIIPRESENTATIONOFFINANCIALINFORMATIONANDUSEOFMARKETDATA
IX
FORWARDLOOKINGSTATEMENTS XEXCHANGERATES XI
SECTIONIIRISKFACTORS
RISKFACTORS XII SECTIONIIIINTRODUCTION
SUMMARY 1THEISSUE 8SUMMARYFINANCIALINFORMATION 9GENERALINFORMATION 15CAPITALSTRUCTURE 21OBJECTSOFTHEISSUE 29STATEMENTOFTAXBENEFITS 73
SECTION1VABOUTUS
OURMANAGEMENT 84RELATEDPARTYTRANSACTIONS 99
SECTIONVFINANCIALSTATEMENTS
AUDITEDFINANCIALSTATEMENTSFORMARCH31,2009 100FINANCIALINDEBTEDNESS 166STOCKMARKETDATA 173
SECTIONVILEGALANDOTHERINFORMATION
OUTSTANDINGLITIGATIONSANDDEFAULTS 176GOVERNMENTANDOTHERAPPROVALS 182OTHERREGULATORYANDSTATUTORYDISCLOSURES 184
SECTIONVIIISSUERELATEDINFORMATION
TERMSOFTHEISSUE 197 SECTIONVIIIOTHERINFORMATION
MATERIALCONTRACTSANDDOCUMENTSFORINSPECTION 229DECLARATION 231
II
SECTIONIGENERAL
DEFINITIONSANDABBREVIATIONS In thisLetterofOffer,all references toRe.,Rupees,Rs.orINR refer to IndianRupees, theofficial currency of India, USD or U.S.$ or $ refer to the United States Dollar, the officialcurrencyof theUnitedStatesofAmerica,Euro refers to theofficial currencyofEuropeanUnion,Dirham refers to the official currency of theUnitedArab Emirates, and CZK refers toCzechKoruna,theofficialcurrencyoftheCzechRepublic.Referencestothesingularalsoreferstothepluralandonegenderalsoreferstoanyothergender,whereverapplicable,andthewordsLakhorLacmeans 100 thousand and theword croremeans 100 lakhs.Any discrepancies in any tablebetweenthetotalandthesumsoftheamountslistedareduetoroundingoff.DefinitionsUnlessthecontextotherwiserequires,thefollowingtermshavethefollowingmeaningsinthisLetterofOffer.
Term DescriptionWe,us,our,ourCompany theIssuer, HFL or theCompany
Unless the context requires, refers toHindujaFoundriesLimited,apubliclimitedcompany incorporatedundertheprovisionsoftheCompaniesAct,1956 having its registered office at Kathivakkam High Road, Ennore,Chennai600057.
Company/ Issue related terms
Term Description
AbridgedLetterofOffer
Theabridged letterofoffertobesent toourEquityShareholdersason theRecord Date with respect to this Issue in accordance with SEBI ICDRRegulations.
ApplicationSupportedbyBlockedAmount/ASBA
The application (whether physical or electronic) used by an Investors tomakeanapplicationauthorizing theSCSB toblock theamountpayableonapplicationintheirspecifiedbankaccount
Articles/ArticlesofAssociation/AoA
TheArticlesofAssociationofourCompany.
ASBAInvestor Anapplicantwho;a)holdsthesharesoftheCompanyindematerializedformasontherecorddate and has applied for entitlements and / or additional shares indematerializedform;b)hasnotrenouncedhis/herentitlementsinfullorinpart;c)isnotarenouncee;d)isapplyingthroughabankaccountmaintainedwithSCSBs.
Auditor Fraser&RossandS.R.Batliboi&Associates,ourstatutoryjointauditors.Board/BoardofDirectors
BoardofDirectorsofHindujaFoundriesLimitedincludinganycommitteesthereof.
BankerstotheIssue IndusIndBankLimited,IDBIBankLimitedandHDFCBankLimitedConsolidatedCertificate
Incaseofphysicalcertificate, theCompanywould issueonecertificate fortheEquitySharesallottedinonefolio.
ControllingBranches Suchbranchesof theSCSBswhichcoordinateapplicationsunder the Issue
III
Term Description
by the ASBA Investors with the Registrar to the Issue and the StockExchanges and a list of which is available athttp://www.sebi.gov.in/pmd/scsb.pdf.
DesignatedBranches SuchbranchesoftheSCSBswhichshallcollectCAFfromASBAinvestorandalistofwhichisavailableonhttp://www.sebi.gov.in/pmd/scsb.pdf
DesignatedStockExchange
BombayStockExchangeLimited(BSE)
Depositories National SecuritiesDepository Limited (NSDL) andCentralDepositoryServices(India)Limited(CDSL)
DraftLetterofOffer DraftLetterofOfferoftheCompanydatedAugust28,2009,fortheRightsIssue.
ECS ElectronicClearingService.EquityShare(s)orShare(s)
EquitysharesofourCompanyhavingafacevalueofRs.10unlessotherwisespecifiedinthecontextthereof.
EquityShareholder MeansaholderofEquitySharesofourCompany.FinancialYear/Fiscal/FiscalYear/FY
AnyperiodoftwelvemonthsendedMarch31ofthatparticularyear,unlessotherwisestated.
Issue Issue of 10,055,749 Equity Shares with a face value of Rs. 10 each at apremiumofRs.40perEquityShareforanamountaggregatingRs.5,027.87lakhsonarightsbasis to theexistingEquityShareholders in theratioof7Equity Share(s) for every 13 fully paidup Equity Share(s) held by theexistingEquityShareholderson theRecordDate.The issueprice is5 timesthefacevalueoftheEquityShares.
IssueClosingDate April10,2010IssueOpeningDate March27,2010IssuePrice Rs.50perEquityShare.Investor(s) EquityShareholdersasonRecordDateand/orRenounceesapplying in the
Issue.LeadManager HDFCBankLimited.LetterofOffer Means the letterofoffer filedwith theStockExchangesafter incorporating
SEBIcommentsontheDraftLetterofOffer.Memorandum/Memorandum ofAssociation/MoA
MemorandumofAssociationoftheCompany.
MICR MagneticInkCharacterRecognition.NetAssetValueperShare
NetWorthdividedbynumberofEquitySharesoutstanding
NetWorth Equity Share capital and reserves (excluding revaluation reserves), net ofmiscellaneousexpenditurenotwrittenoff
Promoter/Promoters The promoters of the Company namely, Hinduja Automotive Limited(UnitedKingdom)andAshokLeylandLimited.
RecordDate February4,2010Refundthroughelectronictransferoffunds
RefundsthroughECS,DirectCredit,RTGSorNEFT,asapplicable.
Registrar ofCompanies/RoC
TheRegistrarofCompanies,Tamilnadu,locatedatBlockNo.6,BWing2ndFloor,ShastriBhavan,HaddowsRoad,Chennai600006.
IV
Term Description
Registrar / Registrar totheIssue
IntegratedEnterprises(India)Limited
Renouncees Any persons who have acquired Rights Entitlements from the EquityShareholders.
RightsEntitlement 7 Equit