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Just Dial - Red Herring Prospectus

Just Dial - Red Herring Prospectus

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Published by Fountainhead
Just Dial - Red Herring Prospectus
Just Dial - Red Herring Prospectus

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Categories:Types, Business/Law
Published by: Fountainhead on May 20, 2013
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11/18/2013

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RED HERRING PROSPECTUS
May 8, 2013
 Please read section 60B of the Companies Act, 1956 
Book Built Offer
JUST DIAL LIMITED
(Our Company was incorporated as A&M Communications Private Limited on December 20, 1993, at New Delhi, as a private limited company under the Companies Act, 1956, as amended (the
Companies Act
.) Subsequently, the registered office of our Company was shifted to the State of Maharashtra and a certificate of registration
 
of the order of the Company Law Board confirmingtransfer of the registered office from one state to another dated December 16, 2004 was issued by the Registrar of Companies, Maharashtra. The name of our Company was changed from A&MCommunications Private Limited to Just Dial Private Limited on December 26, 2006. Further, our Company was converted into a public limited company on July 22, 2011 and consequently, thename of our Company was changed to Just Dial Limited. For details of changes in the registered office and name of our Company, please see the section
“History and Certain Corporate Matters” on
 page 154.)
Registered Office:
Palm Court, Building-M, 501/B, 5
th
Floor, Besides Goregaon Sports Complex, New Link Road, Malad (West), Mumbai 400 064
Contact Person
: Sachin Jain, Company Secretary and Compliance Officer 
Tel:
(91 22)
 
2888 4060;
Fax:
(91 22) 2882 3789;
Email:
investors@justdial.com;
Website:
www.justdial.com
 
Promoters of our Company: V.S.S. Mani, Anita Mani, Ramani Iyer and V. KrishnanPUBLIC OFFER OF 17,497,458 EQUITY SHARES OF A FACE VALUE OF
`
10 EACH
(THE “EQUITY SHARES”)
OF JUST DIAL LIMITED
(THE “COMPANY”) FOR CASH
AT A PRICE OF
`
 
[●]
PER EQUITY SHARE THROUGH AN OFFER FOR SALE BY THE SELLING SHAREHOLDERS
(AS DEFINED IN THE SECTION “DEFINITIONS ANDABBREVIATIONS”)
AGGREGATING UP TO
`
 
[●] MILLION (THE “OFFER”).
A DISCOUNT OF 10% TO THE FLOOR PRICE IS BEING OFFERED TO RETAILINDIVIDUAL BIDDERS
(THE “RETAIL DISCOUNT”)
. THE OFFER WILL CONSTITUTE 25.02% OF THE FULLY DILUTED POST-OFFER PAID-UP EQUITY SHARECAPITAL OF OUR COMPANY. FOR THE DETAILS OF THE EQUITY SHARES OFFERED BY EACH SELLING SHAREHOLDER, PLEASE SEE THE SECTION
“DEFINITIONS AN
D ABBREVIATIONS
 – 
OFFER RELATED TERMS
 – 
 
OFFER” ON PAGE
2.THE FACE VALUE OF EQUITY SHARES IS
`
10
 
EACH. THE PRICE BAND, THE MINIMUM BID LOT AND THE RUPEE AMOUNT OF THE RETAIL DISCOUNT WILLBE DECIDED BY OUR COMPANY AND THE SELLING SHAREHOLDERS IN CONSULTATION WITH THE
BOOK RUNNING LEAD MANAGERS (“BRLMS”)
AND WILLBE ADVERTISED AT LEAST FIVE WORKING DAYS PRIOR TO THE BID/OFFER OPENING DATE AND SUCH ADVERTISEMENT SHALL BE AVAILABLE ON THE
WEBSITES OF THE BSE LIMITED (“BSE”)
, NATIONAL STOCK EXCHANGE OF INDIA LIMITED
(“NSE”)
 
AND MCX STOCK EXCHANGE LIMITED (“MCX
-SX
”)
.
In case of any revisions in the Price Band, the Bid/Offer Period will be extended by at least three additional Working Days after such revision of the Price Band, subject to the Bid/Offer Periodnot exceeding 10 Working Days. Any revision in the Price Band and the revised Bid/Offer Period, if applicable, will be widely disseminated by notification to the BSE, the NSE and MCX-SX, by issuing a press release, and also by indicating the change on the website of the BRLMs.
In terms of Rule 19(2)(b)(i) of the Securities Contracts (Regulation) Rules, 1957, as amended (“
SCRR 
”), this is an Offer for at least
25% of the post-Offer capital. The Offer is being madethrough the Book Building Process wherein at least 75
% of the Offer shall be Allotted on a proportionate basis to Qualified Institutional Buyers (“
QIBs
”)
, provided that our Company and theSelling Shareholders may allocate up to 30% of the QIB Portion to Anchor Investors on a discretionary basis. 5% of the QIB Portion (excluding the Anchor Investor Portion) shall be availablefor allocation on a proportionate basis to Mutual Funds only, and the remainder of the QIB Portion shall be available for allocation on a proportionate basis to all QIB Bidders (other than Anchor Investors), including Mutual Funds, subject to valid Bids being received at or above the Offer Price. If at least 75% of the Offer cannot be Allotted to QIBs, then the entire application moneyshall be refunded forthwith. Further, not more than 15% of the Offer shall be available for allocation on a proportionate basis to Non-Institutional Bidders and not more than 10% of the Offer shall be available for allocation to Retail Individual Bidders in accordance with the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 (the
SEBI Regulations
”)
, subject to valid Bids being received at or above the Offer Price. For details in relation to allocation to Retail Individual Bidders, specific attention of the investors is invited
to the section “Offer Procedure – 
 
Basis of Allotment” on page
418. All potential investors, other than Anchor Investors, may participate in this Offer through an Application Supported by
Blocked Amount (“
ASBA
”) process providi
ng details of their respective bank account which will be blocked by the Self Certified Syndicate Banks
(“
SCSBs
”). QIBs (except Anchor Investors)
and Non-Institutional Bidders are mandatorily required to utilise the ASBA process to participate in this Offer. For details, see the
section ‘Offer Procedure’ on page
386.
RISK IN RELATION TO THE FIRST OFFER 
 This being the first public issue of our Company, there has been no formal market for the Equity Shares of our Company. The face value of the Equity Shares is
`
10 each and the Offer Price is
[●] times of the face value.
 
The Offer Price (determined and justified by our Company and the Selling Shareholders, in consultation with the BRLMs,
as stated under the section “Basis for 
Offer 
Price” on page
110) should not be taken to be indicative of the market price of the Equity Shares after the Equity Shares are listed. No assurance can be given regarding an active or sustainedtrading in the Equity Shares or regarding the price at which the Equity Shares will be traded after listing.
IPO GRADING
 This Offer has been graded by CRISIL Limited
(“
CRISIL
”)
, through letter dated April 16, 2013, as 5/5, indicating that the fundamentals of the Offer are strong relative to the other listed equitysecurities in India. The IPO grade is assigned on a five-point scale from 1 to 5, with IPO grade 5/5 indicating strong fundamentals and IPO grade 1/5 indicating poor fundamentals. For details,
 please see the section “General Information” on page
69.
GENERAL RISKS
 Investments 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 entireinvestment. Investors are advised to read the risk factors carefully before taking an investment decision in this Offer. For taking an investment decision, investors must rely on their ownexamination of our Company and the Offer, including the risks involved. The Equity Shares offered in the Offer have not been recommended or approved by the Securities and Exchange Board
of India (“
SEBI
”), nor does SEBI guarantee the accuracy or adequacy of the contents of this Red Herring Prospectus. Specific attention of the investors is invited to the section “Risk Factors” on
 page 15.
SAFETY NET ARRANGEMENT
A safety net is being provided by the Safety Net Providers (as defined herein) to Retail Individual Allottees (as defined
in the section “Safety Net Arrangement”
) who are resident in India inaccordance with Regulation 44 of the SEBI Regula
tions and as set out in the section “Safety Net Arrangement” on page
372.
COMPANY’S AND SELLING SHAREHOLDERS’
ABSOLUTE RESPONSIBILITY
 Our Company, having made all reasonable inquiries, accepts responsibility for and confirms that this Red Herring Prospectus contains all information with regard to our Company and the Offer,which is material in the context of the Offer, that the information contained in this Red Herring Prospectus 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 make this Red Herring Prospectus as a whole or any of suchinformation or the expression of any such opinions or intentions misleading in any material respect. The Selling Shareholders accept responsibility that this Red Herring
 
Prospectus contains allinformation about them as Selling Shareholders in the context of the Offer and each Selling Shareholder assumes responsibility for statements in relation to such Selling Shareholder included inthis Red Herring Prospectus.
LISTING
 The Equity Shares offered through this Red Herring Prospectus are proposed to be listed on the BSE, the NSE and MCX-SX. We have received an
in-
 principle”
approval from each of the BSE,the NSE and MCX-SX for the listing of the Equity Shares pursuant to the letters dated October 11, 2012, September 24, 2012 and April 12, 2013, respectively. For the purposes of the Offer, theDesignated Stock Exchange shall be the NSE.
BOOK RUNNING LEAD MANAGERS
 
REGISTRAR TO THE OFFER 
Citigroup Global Markets India Private Limited
12
th
Floor, Bakhtawar  Nariman PointMumbai 400 021Tel: (91 22) 6631 9890Fax: (91 22) 3919 7844E-mail: justdial.ipo@citi.comInvestor Grievance Email: investors.cgmib@citi.comWebsite:http://www.online.citibank.co.in/rhtm/citigroupglobalscreen1.htmContact Person: S. AshwinSEBI Registration No.: INM000010718
Morgan Stanley India Company Private Limited
18F/19F, Tower 2, One Indiabulls Centre841, Senapati Bapat MargMumbai 400 013Tel: (91 22) 6118 1000Fax: (91 22) 6118 1040Email: JD_IPO@morganstanley.comInvestor Grievance Email: investors_india@morganstanley.comWebsite: www.morganstanley.com/indiaofferdocumentsContact Person: Ronak SandilSEBI Registration No.: INM000011203
Karvy Computershare Private Limited
Plot No. 17-24, Vittal Rao Nagar, Madhapur Hyderabad 500 081Tel: (91 40) 4465 5000Fax: (91 40) 2343 1551Email: justdial.ipo@karvy.comWebsite: http://karisma.karvy.comContact Person: M. Murli KrishnaSEBI Registration No.: INR000000221
BID/ OFFER PROGRAMME
(1)
 BID/OFFER OPENS ON: May 20, 2013 BID/OFFER CLOSES ON: May 22, 2013
 
(1) 
Our Company and the Selling Shareholders may, in consultation with the BRLMs, consider participation by Anchor Investors in accordance with the SEBI Regulations. The Anchor Investor  Bid/Offer Period shall be one Working Day prior to the Bid/Offer Opening Date.
 
 
ANNEXURE
 
 – 
 
IPO
 
GRADING
 
REPORT ........................................................................................................... 474
 
 
 
1
SECTION I: GENERALDEFINITIONS AND ABBREVIATIONS
This Red Herring Prospectus uses certain definitions and abbreviations which, unless the context otherwiseindicates or implies, shall have the meaning as provided below. References to any legislation, act or regulation shall be to such legislation, act or regulation as amended from time to time.
General TermsTerm Description
our Company
” or “theCompany”
 Just Dial Limited, a company incorporated under the Companies Act andhaving its Registered Office at Palm Court, Building-M, 501/B, 5
th
Floor,Besides Goregaon Sports Complex, New Link Road, Malad (West), Mumbai400 064
 Company Related TermsTerm Description
Articles/ Articles of AssociationArticles of Association of our CompanyAudit Committee The audit committee of the Board of Directors of our CompanyAuditor The statutory auditor of our Company, S.R. Batliboi & Associates LLP. For 
details, please see the section “General Information” on page
69Board/ Board of Directors The board of directors of our Company or a duly constituted committee thereof Director(s) The director(s) of our CompanyEGCS EGCS Investment HoldingsEquity SharesEquity shares of our Company of 
`
10 each fully paid-upESOP Schemes The employee stock option schemes instituted by our Company, namely, JustDial Employee Stock Option Scheme, 2007, Just Dial Employee Stock OptionScheme, 2008 and Just Dial Employee Stock Option Scheme, 2010. For details, plea
se see the section “Capital Structure” on page
78Group Companies Companies, firms and ventures promoted by our Promoters, irrespective of whether such entities are covered under section 370(1)(B) of the Companies Act
or not and disclosed in the section “
Our 
Group Companies” on page
181JD Global Just Dial Global Private LimitedJD USA Just Dial Inc., U.S.A.Memorandum/ Memorandumof AssociationMemorandum of Association of our Company, as amendedPreference Shares Collectively, the Preference Shares Series A, Preference Shares Series B andPreference Shares Series CPreference Shares Series A 6% Cumulative Optionally Convertible Redeemable Preference Shares of SeriesA of face value
`
10 each of our CompanyPreference Shares Series B 0.1% Non-cumulative Optionally Convertible Redeemable Preference Shares of Series B of face value
`
10 each of our CompanyPreference Shares Series C 6% Compulsorily Convertible Non-Cumulative Preference Share of Series C of face value
`
10 each of our CompanyPromoters The promoters of our Company, V.S.S. Mani, Anita Mani, Ramani Iyer and V.Krishnan
. For details, please see the section “
Our Promoters and Promoter 
Group” on page
178Promoter Group The persons and entities constituting the promoter group of our Company interms of Regulation 2(zb) of the SEBI Regulations and disclosed in the section
Our Promoters
and Promoter Group” on page
178Registered Office The registered office of our Company, which is located at Palm Court,Building-M, 501/B, 5
th
Floor, Besides Goregaon Sports Complex, New Link 

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