Netweb Technologies India IPO Basis of Allotment

Our Company was originally incorporated as 'Netweb Technologies India Private Limited', at New Delhi as a private limited company under the Companies Act. 1956 and received a certificate of incorporation issued by the RoC. on September 22,1999. Thereafter, our Company was converted into a public limited company, pursuant to a special resolution passed by the Shareholders of our Company on October 18.2022, and the name of our Company was changed to its present name pursuant to a fresh certificate of incorporation issued by the RoC on November 18.2022. For further details of changes in the name, registered office of our Company, and details in relation to the acquisition of a business undertaking of our Promoter and Chairman and Managing Director, Sanjay Lodha by our Company, see ‘History and Certain Corporate Matters on page 252 of the Prospectus dated July 21,2023 ( Prospectus' ).

INITIAL PUBLIC OFFER OF 12,621,000 EQUITY SHARES OF FACE VALUE OFRs. 2 EACH (EQUITY SHARES) OF NETWEB TECHNOLOGIES INDIA LIMITED (COMPANY) FOR CASH AT A PRICE OF Rs. 500 PER EQUITY SHARE (INCLUDING A SHARE PREMIUM OF Rs. 498 PER EQUITY SHARE) (OFFER PRICE) AGGREGATING Rs. 6,310.00 MILLION (OFFER) COMPRISING A FRESH ISSUE OF 4,121.000 EQUITY SHARES AGGREGATING Rs. 2,060.00 MILLION BY THE COMPANY (FRESH ISSUE) AND AN OFFER FOR SALE OF 8.500,000 EQUITY SHARES AGGREGATING Rs. 4,250.00 MILLION BY THE SELLING SHAREHOLDERS (OFFER FOR SALE) COMPRISING 2,860,000 EQUITY SHARES AGGREGATING Rs. 1,430.00 MILLION BY SAN JAY LODHA. 1,430,000 EQUITY SHARES AGGREGATING Rs. 715.00 MILLION BY NAVIN LODHA, 1,430,000 EQUITY SHARES AGGREGATING Rs. 715.00 MILLION BY VIVEK LODHA, 1,430,000 EQUITY SHARES AGGREGATING Rs. 715.00 MILLION BY NIRAJ LODHA (EACH, THE PROMOTER SELLING SHAREHOLDER) AND. 1,350,000 EQUITY SHARES AGGREGATING Rs. 675.00 MILLION BY ASHOKA BAJAJ AUTOMOBILES LLP (FORMERLY KNOWN AS ASHOKA BAJAJ AUTOMOBILES PRIVATE LIMITED), PROMOTER GROUP SELLING SHAREHOLDER, AND TOGETHER WITH THE PROMOTER SELLING SHAREHOLDERS, THE SELLING SHAREHOLDERS, AND SUCH EQUITY SHARES, THE OFFERED SHARES).

THE COMPANY HAS, IN CONSULTATION WITH THE BRLMS, UNDERTAKEN A PRE-IPO PLACEMENT OF 1,020,000 EQUITY SHARES AT AN ISSUE PRICE OF Rs. 500 PER EQUITY SHARE (INCLUDING A PREMIUM OF Rs. 498 PER EQUITY SHARE) AGGREGATING Rs. 510.00 MILLION (PRE-IPO PLACEMENT). THE SIZE OF THE FRESH ISSUE OF Rs. 2,570.00 MILLION WAS REDUCED BY Rs. 510.00 MILLION PURSUANT TO THE PRE-IPO PLACEMENT AND THE REVISED SIZE OF THE FRESH ISSUE IS Rs. 2,060.00 MILLION. THE OFFER INCLUDED A RESERVATION OF 20,000 EQUITY SHARES AGGREGATING Rs. 9.50 MILLION (CONSTITUTING 0.04% OF OUR POST-OFFER EQUITY SHARE CAPITAL), FOR SUBSCRIPTION BY ELIGIBLE EMPLOYEES (EMPLOYEE RESERVATION PORTION). OUR COMPANY AND THE SELLING SHAREHOLDERS. IN CONSULTATION WITH THE BRLMS, OFFERED A DISCOUNT OF 5% OF THE OFFER PRICE (EQUIVALENT OF Rs. 25 PER EQUITY SHARE) TO THE ELIGIBLE EMPLOYEES BIDDING IN THE EMPLOYEE RESERVATION PORTION (EMPLOYEE DISCOUNT). THE OFFER LESS THE EMPLOYEE RESERVATION PORTION IS HEREINAFTER REFERRED TO AS THE NET OFFER. THE OFFER AND THE NET OFFER CONSTITUTE 22.51% AND 22.48% OF OUR POST-OFFER PAID-UP EQUITY SHARE CAPITAL, RESPECTIVELY

Risks to Investors:

Business Risk;

• A significant proportion of our orders are from government related entities which award the contract through a process of tender. Tenders, typically, are awarded to the lower bidder once all other eligibility criteria are met. Our performance could be adversely affected if v/e are not able to successfully bid for these contracts or required to lower our bid value.

'Revenue from operations excludes Other operating revenue

• We have had low-capacity utilisation in Fiscals 2023,2022 and 2021. The capacity utilisation for Fiscal 2023,2022 and 2021 of our facility are 51.64%, 53.11% and 52.01% respectively.

Concentration risk:

• Our success is dependent on our long-term relationship with our Customers. In particular, we are heavily reliant on our top 10 Customers. We do not, generally, enter into long term contracts with Customers, which exposes us to risks emanating from the inability to retain our established Customers as our clients.

*Revenue from operations excludes Other operating revenue.

Loss of all or a substantial portion of sales to any of our top 10 Customers, for any reason could have a material adverse impact on our business, results of operations, financial condition and cash flows.

• We derive a majority portion of our revenues from operations from a select few of our HCS offerings. Loss or decline in the demand of such offerings may result in an adverse effect on our business, revenue from manufacturing operations and financial condition

*Revenue from operations excludes Other operating revenue.

Other Risk:

• The companies disclosed as peer set of our Company in the 'Basis for Offer Price' section are not in the same line of business as that of our Company i.e providing HCS offering. There is no direct comparison with these listed peers. Therefore, investors must rely on their own examinations of accounting ratios of our Company for the purposes of investment in this Offer.

• While our Promoters and Whole Time Directors possess educational qualifications in management and commerce, they do not possess educational qualifications in the field of information technology. Our future success will depend, on among other factors, the ability of our Company to evolve with the changing landscape of the business verticals in which we operate.

• The Weighted Average Cost of acquisition of all Equity Shares transacted in last three years, 18 months and one year preceding the date of the Prospectus:

As certified by M/s APT & Co LLP, the Independent Chartered Accountant, vide their certificate dated July 21,2023. *The Cap price i.e., Rs. 500 which is also the Offer Price.

• Weighted average cost of acquisition compared to Floor Price and Cap Price:

As certified by our Statutory Auditors, S S Kotbari & Company, pursuant to a certificate dated July 21,2023. ‘The Cap price i.e., 7 500 which is also the Offer Price.

• Average cost of acquisition of Equity Shares for the selling shareholders namely, Sanjay Lodha is 7 0.43, Navin Lodha is 7 0.11, Vivek Lodha is 7 0.35, Niraj Lodha is 7 0.84 and Ashoka Bajaj Automobiles LLP (formerly known as Ashoka Bajaj Automobiles Private Limited) is 71.56 and Offer Price is 7 500 per Equity Share.

• The Price/Earnings ratio based on diluted EPS for fiscal 2023 for our Company at Offer Price is 55.13 times and Price/Earnings ratio of the average industry peer group as on June 30,2023 is 79.82 times.

• Weighted Average Return on Net Worth for Fiscals 2023,2022 and 2021 is 64.35%.

• Our market capitalisation at the lower end and higher end of price band to total income for fiscal 2023 is 6.00 times and 6.29 times respectively.

• The two BRLMs associated with the Offer have handled 42 public issues in the past three Fiscal Years, out of which 13 issue closed below the Offer price on the listing date.

The Offer was made in terms of Rule 19(2)(b) of the Securities Contacts (Regulation) Rules, 1957 (SCRR). read with Regulation 31 of the SEBIICDR Regulations. The Offer was made in accordance with Regulation 6( 1) of the SEBI ICDR Regulations, through the Book Building Process wherein not more than 50% of the Net Offer was made available for allocation on a proportionate basis to Qualified Institutional Buyers (QIBs) (such portion referred to as QIB Portion). Our Company and the Selling Shareholders, in consultation with the BRLMs allocated 60% of the QIB Portion to Anchor Investors on a discretionary basis in accordance with the SEBI ICDR Regulations (Anchor Investor Portion), out of which one-third was reserved for domestic Mutual Funds only, subject to valid Bids being received from domestic Mutual Funds at or above the price at which allocation was made to Anchor Investors (Anchor Investor Allocation Price), in accordance with the SEBI ICDR Regulations. Further, 5% of the Net QIB Portion was made available for allocation on a proportionate basis to Mutual Funds only, and the remainder of the Net QIB Portion was made 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. However, if the aggregate demand from Mutual Funds was less than 5% of the Net QIB Portion, the balance Equity Shares available for allocation in the Mutual Fund Portion were made available to be added to the remaining Net QIB Portion for proportionate allocation to all QIBs. Further, not less than 15% of the Net Offer were made available for allocation on a proportionate basis to Non-lnstitutional Investors out of which (a) one-third of such portion was reserved for applicants with application size of more than Rs. 0.2 million and up to Rs. 1 million; and (b) two-third of such portion reserved for applicants with application size of more than Rs. 1 million, and not less than 35% of the Net Offer was available for allocation to Retail Individual Investors in accordance with the SEBI ICDR Regulations, subject to valid Bids being received at or above the Offer Price. Further, 20.000 Equity Shares were allocated on a proportionate basis to Eligible Employees applying under the Employee Reservation Portion, subject to valid Bids being received at or above the Offer Price. All potential Bidders (except Anchor Investors) were required to mandatorily use the Application Supported by Blocked Amount (ASBA) process providing details of their respective ASBA accounts, and UPI ID in case of UPI Bidders, if applicable, in which the corresponding Bid Amounts would have been blocked by the SCSBs or by the Sponsor Banks under the U PI Mechanism, as applicable, to the extent of the respective Bid Amounts. Anchor Investors were not permitted to participate m the Offer through theASBAprocess. For further details, see Offer Procedure'on page 440 of the Prospectus.

The bidding for Anchor Investor opened and closed on July 14,2023. The Company received 25 applications from 15 Anchor Investors for 37,80.300 Equity Shares. The Anchor Investor Offer Price was finalized at Rs. 500 per Equity Share. A total of 37,80.300 Equity Shares were allocated under the Anchor Investor Portion aggregating to Rs. 1,89,01,50,000.00'-. The Offer received 22,44.602 applications for 80,50,70,700 Equity Shares resulting in 63.79 times subscription as disclosed in the Prospectus. The details of the applications received in the Offer from Retail Individual Bidders. Non-lnstitutranal Bidders and QIBs are as under (before rejections):

Final Demand

A summary of the final demand as per BSE and NSE as on the Bid/Offer Closing Date at different Bid prices is as under:

The Basis of Allotment was finalized in consultation with the Designated Stock Exchange, being BSE on July 24.2023.

The Basis of Allotment to the Retail Individual Bidders, who have bid at cut-off or at the Offer Price of Rs. 500 per Equity, was finalized in consultation with BSE. This category has been subscribed to the extent of 18.74 times. The total number of Equity Shares Allotted in Retail Individual Bidders category is 44.10,350 Equity Shares to 1.47,011 successful applicants. The category-wise details of the Basis of Allotment are as under:

The Basis of Allotment to the Non-lnstitutional Bidders (more than Rs. 2 lakhs and upto Rs. 10 lakhs), who have bid at the Offer Price of 7 500 per Equity Share or above, was finalized in consultation with BSE . This category has been subscribed to the extent of 72.52 times. The total number of Equity Shares allotted in this category is 6,30,050 Equity Shares to 1,500 successful applicants. The category-wise details of the Basis of Allotment are as under (Sample)

The Basis of Allotment to the Non-lnstitutional Bidders (more than Rs. 10 lakhs), who have b*d at the Offer Price ofRs. 500 per Equity Share or above, was finalized in consultabon with BSE This category has been subscribed to the extent of 87.60 times. The total number of Equity Shares allotted in this category is 12.60.100 Equity Shares to 3.000 successful applicants. The category-wise details of the Basis of Allotment are as under (Sample)

D. Allotment to Eligible Employees (After Rejections)

The Basis of Allotment to the Eligible Employees, who have bid at the Offer Price ofRs. 500 per Equity Share or above, was finalized in consultation with BSE. This category has been subscribed to the extent of 1.29 times. The total number of Equity Shares allotted in this category is 20,000 Equity Shares to 132 successful applicants The category-wise details of the Basis of Allotment are as under:

Allocation to Eligible Employees (upto Rs. 2,00,000)

Allocation to Eligible Employees (Rs. 2,00,000 Upto Rs. 5,00,000)

Allotment to QIBs, who have bid at the Offer Price of Rs. 500 per Equity Share or above, has been done on a proportionate basis in consultation with BSE. This category has been subscnbed to the extent of 220.10 times of Net QIB portion. As per the SEBIICDR Regulations. Mutual Funds were allotted 5% of the Equity Shares of Net QIB portion available i.e. 1.26,010 Equity Shares and other QIBs and unsatisfied demand of Mutual Funds were allotted the remaining available Equity Shares i.e. 2.394,190 Equity Shares on a proportionate basis. The total number of Equity Shares allotted in the QIB category is 25.20.200 Equity Shares which were allotted to 166 successful Applicants.

The Company and the Selling Shareholders in consultation with the BRLMs, have allocated 3,780,300 Equity Shares to 25 Anchor Investors (through 15 Anchor Investor Application Forms) (including 9 domestic Mutual Funds through 19 schemes) at an Anchor Investor Offer Price at Rs. 500 per Equity Share in accordance with SEBIICDR Regulations. This represents 60% of the QIB portion.

The IPO Committee of our Company at its meeting held on July 24,2023 has taken on record the basis of allotment of Equity Shares approved by the Designated Stock Exchange, being BSE and has allotted the Equity Shares to various successful applicants. The Allotment Advice Cum Refund Intimation and/or notices have been emailed/dispatched to the address of the investors as registered with the depositories. Further, instructions to the SCSBs have been issued for unblocking of funds and transfer to the Public Offer Account on July 24.2023 and the payments to non-syndicate brokers have been issued on July 25.2023. In case the same is not received within ten days, investors may contact the Registrar to the Offer at the address given below. The Equity Shares allotted to the successful allottees have been uploaded on July 25,2023 for credit into the respective beneficiary accounts subject to validation of the account details with the depositories concerned. The Company has filed the Listing application with NSE and BSE on July 25.2023. The Company has received the listing and trading approval from NSE & BSE. and trading will commence on July 27,2023.

Note: All capitalized terms used and not defined herein shall have the respective meanings assigned to them in the Prospectus.

These details of the Allotment made shall be hosted on the website of Registrar to the Offer, Link Intime India Private Limited at www.linkintime.co.in.

All future correspondence in this regard may kindly be addressed to the Registrar to the Offer quoting full name of the First/ Sole applicant. Serial number of the Bid cum Application form number, Bidders DP ID, Client ID, PAN, date of submission of Bid cum Application Form, address of the Bidder, number of Equity Shares bid for, name of the Member of the Syndicate, place where the bid was submitted and payment details at the address given below:

THE LEVEL OF SUBSCRIPTION SHOULD NOT BE TAKEN TO BE INDICATIVE OF EITHER THE MARKET PRICE OF THE EQUITY SHARES ON LISTING OR THE BUSINESS PROSPECTS OF NETWEB TECHNOLOGIES INDIA LIMITED.
NETWEB TECHNOLOGIES INDIA LIMITED has filed the Prospectus with the Registrar of Companies. National Capital Territory of Delhi and Haryana at New Delhi. The Prospectus is available on the website of SEBI at www.sebi.gov.in as well as on the websites of the Book Running Lead Managers. Equirus Capital Private Limited at www.equirus.com. and IIFL Securities Limited at www.iiflcap.com Potential investors should note that investment in equity shares involves a high degree of risk and for details relating to such risk, please see the section titled ‘Risk Factors'on page 35 of the Prospectus.
This announcement has been prepared for publication in India and may not be released in the United States. This announcement does not consbtute an offer of Equity Shares for sale in any jurisdiction, including the United States, and the Equity Shares offered in the Offer may not be offered or sold in the United States absent registration under the US. Securities Act of 1933 or an exemption from registration. Any public offering of the Equity Shares to be made in the United States will be made by means of a prospectus that may be obtained from the Company and that will contain detailed information about the Company and management, as well as financial statements. However, the Equity Shares offered in the Offer are not being offered or sold in the United States