Rajapalayam Mills : Letter of offer (Final Offer Document filed with Stock Exchanges)

Letter of Offer

January 6, 2023

For Eligible Equity Shareholders of our Company only

RAJAPALAYAM MILLS LIMITED

Our Company was incorporated as 'Rajapalayam Mills Limited' as a public limited company under the India Companies Act, 1913 (Act VII of 1913) at Rajapalayam pursuant to certificate of incorporation dated February 24, 1936 issued by the Registrar of Joint Stock Companies, Ramnad. Thereafter, our Company was granted the certificate of commencement of business dated December 22, 1936. There has been no change in the name and address of Registered Office of our Company since its incorporation.

Registered Office: Rajapalayam Mills Premises, Post Box No. 1, P.A.C. Ramaswamy Road, Rajapalayam - 626 117, Tamil Nadu, India;

Telephone:[phone];Email: [e-mail]; Website: www.rajapalayammills.co.in;

Contact Person: A. Arulpranavam, Company Secretary and Compliance Officer; Email: [e-mail];

Corporate Identity Number: L17111TN1936PLC002298

PROMOTERS OF OUR COMPANY - P R VENKETRAMA RAJA AND P V ABINAV RAMASUBRAMANIAM RAJA.

FOR PRIVATE CIRCULATION TO THE ELIGIBLE EQUITY SHAREHOLDERS OF RAJAPALAYAM MILLS LIMITED

(THE "COMPANY" OR THE "ISSUER") ONLY

ISSUE OF UPTO 6,14,680 FULLY PAID-UP EQUITY SHARES WITHAFACE VALUE OF `10 EACH ("RIGHTS EQUITY SHARES") FOR CASH AT A PRICE OF `569 EACH INCLUDING A SHARE PREMIUM OF `559 PER RIGHTS EQUITY SHARE ("ISSUE PRICE") AGGREGATING TO AN AMOUNT UP TO `3,497.53 LAKHS* ON A RIGHTS BASIS TO THE EXISTING EQUITY

SHAREHOLDERS OF OUR COMPANY IN THE RATIO OF 1 (ONE) RIGHTS EQUITY SHARE FOR EVERY 14 (FOURTEEN) FULLY PAID UP EQUITY SHARES HELD BY THE EXISTING EQUITY SHAREHOLDERS ON THE RECORD DATE, THAT IS ON FRIDAY, DECEMBER 30, 2022 (THE "ISSUE"). THE ISSUE PRICE FOR THE RIGHTS EQUITY SHARES IS 56.9 TIMES THE FACE VALUE OF THE EQUITY SHARES. FOR FURTHER DETAILS, SEE THE CHAPTER TITLED "TERMS OF THE ISSUE"

BEGINNING ON PAGE 114. *Assuming full subscription.

WILFUL DEFAULTER OR FRAUDULENT BORROWER

NEITHER OUR COMPANY NOR ANY OF OUR PROMOTERS OR DIRECTORS IS CATEGORISED AS A WILFUL DEFAULTER OR A FRAUDULENT BORROWER.

GENERAL RISKS

Investments in equity and equity related securities involve a degree of risk and Investors should not invest any funds in this Issue unless they can afford to take the risk with such investment. Investors are advised to read the risk factors carefully before taking an investment decision in the Issue. For taking an investment decision, Investors shall rely on their own examination of our Company and the Issue including the risks involved. The securities being offered in the Issue have not been recommended or approved by the Securities and Exchange Board of India ("SEBI") nor does SEBI guarantee the accuracy or adequacy of this Letter of Offer. Specific attention of the Investors is invited to the statement of "Risk Factors" beginning on page 18.

COMPANY'S ABSOLUTE RESPONSIBILITY

Our Company, having made all reasonable inquiries, accepts responsibility for and confirms that this Letter of Offer contains all information with regards to the Company and the Issue, which is material in the context of this Issue, and that the information contained in this Letter of Offer is true and correct in all material aspects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this Letter of Offer as a whole or any such information or the expression of any such opinions or intentions misleading in any material respect.

LISTING

The existing Equity Shares of our Company are listed on BSE Limited ("BSE"/ "Stock Exchange"). Our Company has received an "in-
principle" approval from BSE for listing of the Rights Equity Shares to be allotted in this Issue pursuant to letter dated December 13, 2022.
Our Company will also make an application to the Stock Exchange to obtain the trading approval for the Rights Entitlements as required under
the SEBI circular bearing reference number SEBI/HO/CFD/DIL2/CIR/P/2020/13 dated January 22, 2020. BSE shall be the Designated Stock
Exchange for the purpose of this Issue.
LEAD MANAGER TO THE ISSUE			REGISTRAR TO THE ISSUE
Vivro Financial Services Private Limited	Cameo Corporate Services Limited
Vivro House, 11, Shashi Colony, Opposite Suvidha Shopping Center,	Subramanian Building, No. 1, Club House Road, Chennai - 600 002,
Paldi, Ahmedabad - 380 007, Gujarat, India.	Tamil Nadu, India
Telephone: [phone]	Telephone: + 91-44-40020700;
Email: [e-mail]
Email: [e-mail]
Website: www.cameoindia.com /
Website: www.vivro.net
		https://rights.cameoindia.com/rajapalayam1
Investor Grievance Email: [e-mail]
Investor Grievance Email: [e-mail]
Contact Person: Anshul Nenawati / Samir Santara	Contact Person: K. Sreepriya
SEBI Registration Number: INM000010122	SEBI Registration Number: INR000003753

	ISSUE PROGRAMME*
ISSUE OPENS ON	LAST DATE FOR ON MARKET RENUNCIATION*	ISSUE CLOSES ON#
WEDNESDAY, JANUARY 18, 2023	THURSDAY, FEBRUARY 2, 2023	TUESDAY, FEBRUARY 7, 2023

*Eligible Equity Shareholders are requested to ensure that renunciation through off-market transfer is completed in such a manner that the Rights Entitlements are credited to the demat account of the Renouncee(s) on or prior to the Issue Closing Date.

#Our Board or Rights Issue Committee thereof will have the right to extend the Issue period as it may determine from time to time but not exceeding 30 (thirty) days from the Issue Opening Date (inclusive of the Issue Opening Date). Further, no withdrawal of Application shall be permitted by any Applicant after the Issue Closing Date.

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CONTENTS
SECTION I - GENERAL	3
DEFINITIONS AND ABBREVIATIONS	3
NOTICE TO INVESTORS	11
FORWARD LOOKING STATEMENTS	15
SUMMARY OF THIS LETTER OF OFFER	16
SECTION II - RISK FACTORS	18
SECTION III - INTRODUCTION	35
THE ISSUE	35
GENERAL INFORMATION	36
CAPITAL STRUCTURE	41
OBJECTS OF THE ISSUE	43
STATEMENT OF SPECIAL TAX BENEFITS	64
SECTION IV: ABOUT OUR COMPANY	68
INDUSTRY OVERVIEW	68
OUR BUSINESS	74
OUR MANAGEMENT AND ORGANISATIONAL STRUCTURE	82
SECTION V: FINANCIAL INFORMATION	88
FINANCIAL STATEMENTS	88
MATERIAL DEVELOPMENTS	89
ACCOUNTING RATIOS	90
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS	92
SECTION VI: LEGAL AND OTHER INFORMATION	102
OUTSTANDING LITIGATIONS AND DEFAULTS	102
GOVERNMENT AND OTHER APPROVALS	104
OTHER REGULATORY AND STATUTORY DISCLOSURES	106
SECTION VII - ISSUE RELATED INFORMATION	114
TERMS OF THE ISSUE	114
RESTRICTIONS ON PURCHASES AND RESALES	143
SECTION VIII - OTHER INFORMATION	148
MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION	148
DECLARATION	149

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SECTION I - GENERAL

DEFINITIONS AND ABBREVIATIONS

This Letter of Offer uses the definitions and abbreviations set forth below, which you should consider when reading the information contained herein. The following list of certain capitalised terms used in this Letter of Offer is intended for the convenience of the reader/prospective investor only and is not exhaustive.

This Letter of Offer uses the definitions and abbreviations set forth below, which, unless the context otherwise indicates or implies, or unless otherwise specified, shall have the meaning as provided below. References to any legislation, act, regulation, rules, guidelines or policies shall be to such legislation, act, regulation, rules, guidelines or policies as amended, supplemented, or re-enacted from time to time and any reference to a statutory provision shall include any subordinate legislation made from time to time under that provision.

The words and expressions used in this Letter of Offer, but not defined herein, shall have the same meaning (to the extent applicable) ascribed to such terms under the SEBI ICDR Regulations, the Companies Act, 2013, the SCRA, the Depositories Act, and the rules and regulations made thereunder. Notwithstanding the foregoing, terms used in sections / chapters titled "Industry Overview", "Statement of Special Tax Benefits", "Financial Information", "Outstanding Litigations and Defaults" and "Terms of the Issue" on pages 68, 64, 88, 102 and 114 respectively, shall have the meaning given to such terms in such sections.

General terms

Term		Description
"Rajapalayam	Mills Rajapalayam Mills Limited, a public limited company incorporated under the

Limited" or "RML" or "Our Companies Act, 1913 and having its registered office at Rajapalayam Mills

Company"		or	"the Premises, Post Box No. 1, PAC Ramaswamy Road, Rajapalayam - 626 117, Tamil
Company" or "the Issuer"	Nadu, India.
Company related terms
Term			Description
Articles /	Articles	of	The Articles of Association of our Company, as amended from time to time.
Association / AoA
Associate	/	Associate	Our Associate Companies as on the date of the Letter of Offer includes The Ramco
Companies				Cements Limited, Ramco Industries Limited and Ramco Systems Limited
Auditor	/	Statutory	The joint statutory auditors of our Company, being M/s. N.A. Jayaraman & Co.,
Auditor				Chartered Accountants and M/s SRSV & Associates, Chartered Accountants.
Audited	Consolidated	The audited consolidated financial statements of our Company for the financial year
Financial Statements		ended March 31, 2022 which comprises of the consolidated balance sheet as at March
				31, 2022, the consolidated statement of profit and loss including other comprehensive
				income, the consolidated cash flow statement, the consolidated statement of changes
				in equity for the year ended March 31, 2022, and notes to the consolidated financial
				statements, including a summary of significant accounting policies and other
				explanatory information. For details, see "Financial Statements" on page 88.
Board / Board of Directors	Board of Directors of our Company, including any committees thereof.
Equity Share(s)			The equity shares of our Company of a face value of ₹10 each, unless otherwise
				specified in the context thereof.
Independent Director(s)		The independent director(s) of our Company, in terms of Section 2(47) and Section
				149(6) of the Companies Act and Regulation 16(1)(b) of the SEBI Listing
				Regulations.
Key	Management	Key management / managerial personnel of our Company in accordance with
Personnel / KMP		Regulation 2(1)(bb) of the SEBI ICDR Regulations and as described in "Our
				Management - Our Key Management Personnel and Senior Management
				Personnel" on page 86.
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Term	Description
Memorandum	/	Memorandum of association of our Company, as amended from time to time.
Memorandum	of
Association / MoA
Promoter(s)		The Promoters of our Company, namely P R Venketrama Raja and P V Abinav
		Ramasubramaniam Raja.
Promoter Group	The persons and entities constituting the promoter group of our Company in terms of
		Regulation 2(1)(pp) of the SEBI ICDR Regulations.
Registered Office	The registered office of our Company located at Rajapalayam Mills Premises, Post
		Box No. 1, PAC Ramaswamy Road, Rajapalayam - 626 117, Tamil Nadu, India
Registrar of	Companies/	The Registrar of Companies, Tamil Nadu at Chennai.
RoC
Rights Issue Committee	The committee of our Board constituted through the resolution dated December 21,
		2020.
Shareholders	/ Equity	The equity shareholders of our Company, from time to time.
Shareholder
Unaudited Consolidated	The limited review interim unaudited consolidated financial results of our Company
Financial Results /	for six months period ended September 30, 2022, including the notes thereto and the
Limited Review Interim	report thereon. For details, see "Financial Information" on page 88.
Unaudited Consolidated
Financial Statements
Issue related terms
Term	Description
Abridged Letter of Offer /	The abridged letter of offer to be sent to the Eligible Equity Shareholders of our
ALOF		Company with respect to this Issue in accordance with the SEBI ICDR Regulations
		and the Companies Act.
Additional Rights Equity	The Rights Equity Shares applied or allotted under this Issue in addition to the Rights
Shares		Entitlement.
Allot / Allotted /	Unless the context otherwise requires, the allotment of Rights Equity Shares pursuant
Allotment		to the Issue.
Allotment Accounts	The accounts opened with the Bankers to this Issue into which amounts blocked by
		Application Supported by Blocked Amount in the ASBA Account, with respect to
		successful Applicants will be transferred on the Transfer Date in accordance with
		Section 40(3) of the Companies Act.
Allotment Account Bank	Bank(s) which are clearing members and registered with SEBI as bankers to an issue
		and with whom the Allotment Accounts will be opened, in this case being, HDFC
		Bank Limited.
Allotment Advice	Note, advice or intimation of Allotment sent to each successful Applicant who has
		been or is to be Allotted the Rights Equity Shares pursuant to the Issue.
Allotment Date	Date on which the Allotment is made pursuant to this Issue.
Allottee(s)		Persons to whom the Rights Equity Shares are Allotted pursuant to the Issue.
Applicant(s) / Investor(s)	Eligible Equity Shareholder(s) and/or Renouncees who are entitled to make an
		application for the Rights Equity Shares in terms of this Letter of Offer.
Application		Application made through submission of the Application Form or plain paper
		Application to the Designated Branch of the SCSBs or online / electronic application
		through the website of the SCSBs (if made available by such SCSBs) under the ASBA
		process to subscribe to the Rights Equity Shares at the Issue Price.
Application Form	Unless the context otherwise requires, an application form (including online
		application form available for submission of application through the website of the
		SCSBs (if made available by such SCSBs) under the ASBA process) used by an
		Investor to make an application for the Allotment of the Rights Equity Shares in the
		Issue.
Application Money	Aggregate amount payable in respect of the Rights Equity Shares applied for in the
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