Sanstar IPO Basis of Allotment

Our Company was originally incorporated as 'Continental Papers Limited' under the Companies Act, 1956, as a public limited company, pursuant to the certificate of incorporation dated February 26,1982 issued by the Registrar of Companies, Delhi & Haryana. The name of our Company was subsequently changed to 'Sanstar Limited', pursuant to resolution passed by the board of directors on March 9 ,2012 and approved by the shareholders in their EGM held on March 16,2012 and afresh certificate of incorporation dated April 2,2012, consequent upon change of name was issued by the Registrar of Companies, Delhi & Haryana. For further details on the changes in the name and registered office of our Company, please refer to chapter titled ‘History and Certain Corporate Matters' on page 262 of the Prospectus dated July 24,2024 filed with the RoC ("Prospectus').

Our Company has filed the Prospectus with the RoC, and the Equity Shares are proposed to be listed on the National Stock Exchange of India Limited ("NSE") and BSE Limited ("BSE") and trading will commence on July 26,2024.

INITIAL PUBLIC OFFER OF 53,700,000 EQUITY SHARES OF FACE VALUE Rs.2/- EACH ("EQUITY SHARES") OF SANSTAR LIMITED FOR CASH AT A PRICE OF Rs.95/- PER EQUITY SHARE (INCLUDING ASHARE PREMIUM OFRs. 93/- PER EQUITY SHARE) (THE "OFFER PRICE"), AGGREGATING TO Rs. 5,105.50 MILLION COMPRISING OF A FRESH ISSUE OF 41,800,000 EQUITY SHARES AGGREGATING TO Rs. 3,971.00 MILLION BY OUR COMPANY ("FRESH ISSUE") AND AN OFFER FOR SALE OF 11,900,000 EQUITY SHARES AGGREGATING TORs. 1,130.50 MILLION COMPRISING OF 500,000 EQUITY SHARES BY GOUTHAMCHAND SOHANLAL CHOWDHARY AGGREGATING TORs.47.50 MILLION, 3,800,000 EQUITY SHARES BY RANI GOUTHAMCHAND CHOWDHARY AGGREGATING TO Rs. 361.00 MILLION, 500,000 EQUITY SHARES BY SAMBHAV GAUTAM CHOWDHARY AGGREGATING TO Rs. 47.50 MILLION, 500,000 EQUITY SHARES BY SHREYANS GAUTAM CHOWDHARY AGGREGATING TO Rs. 47.50 MILLION, 3,300,000 EQUITY SHARES BY RICHA SAMBHAV CHOWDHARY AGGREGATING TO Rs. 313.50 MILLION AND 3,300,000 EQUITY SHARES BY SAMIKSHA SHREYANS CHOWDHARY AGGREGATING TO Rs. 313.50 MILLION ("THE OFFER FOR SALE").

1. Risk in relation to raw material prices: Our cost of material consumed were

Rs. 8,329.30 million, Rs. 9,588.56 million and Rs. 3,915.23 million constituting 83.97%, 83.07% and 81.10% of our total expenses for the Fiscals 2024, 2023 and 2022 respectively. Any fluctuations in the prices of our raw material may adversely affect the pricing of our products and may have an impact on our business and financial condition.

2. Supplier concentration risk: The primary raw material required for manufacturing our Company's products is ‘maize'. Our Top 10 suppliers constituted 34.88%, 21.82% and 53.38% as a % of total purchases for Fiscals 2024, 2023 and 2022 respectively. We have not entered into any long term contracts with suppliers and an increase in the cost of, or a shortfall in the availability of such raw materials or our inability to leverage existing or new relationships with our suppliers could have an adverse effect on our business.

3. Risk in relation to financial indebtedness: We have total borrowings (long term and short term including current maturity) outstanding amounting to Rs. 1,276.36 million, Rs. 1,117.00 million and Rs. 852.24 million as on March 31,2024,2023 and 2022 respectively. Our financing agreements impose certain restrictions and our failure to comply with covenants may affect our financial condition.

4. Industry concentration risk: Our Company sells its products for specific use by certain industries as under:

Any reduction in the demand or requirement of our products in such industries may result in loss of our business.

5. Risk of meeting working capital requirements during peak harvesting season: During the peak arrival season of maize harvesting i.e September month to December month, our Company procures and stores significant quantities of maize and for the purpose of doing the same significant amount of working capital is required. Our working capital requirement was Rs. 1890.90 million, Rs. 1,255.73 million and Rs. 449.12 million constituting 17.72%, 10.42% and 8.90% of Revenue from Operations for Fiscals 2024, 2023 & 2022 respectively. Our inability to meet the said working capital requirement during the peak harvesting season of maize may have an adverse effect on our overall business.

6. Objects related risks: We intend to utilize upto Rs. 1,815.55 million out of the Net Proceeds to fund the capital expenditure requirement for expansion of the Dhule Facility. We have not yet placed purchase orders or entered into any memorandum of understanding for the majority portion of requirement of the plant and machinery in relation to the proposed expansion of our Dhule Facility. Further, our proposed plans, are subject to the risk of unanticipated delays in obtaining approvals, implementation and cost overruns for the proposed expansion which may adversely affect our business.

7. Customer concentration risk: Our Company in the usual course of business does not have any long term contracts with its customers. Our Top 10 customers contributed 40.53%, 45.89% and 73.87% as a % of our Gross Revenue from Operations for Fiscals 2024, 2023 & 2022 respectively. Loss of one or more of our top customers or a reduction in their demand for our products or reduction in revenue derived from them may adversely affect our business.

8. Risk of underutilisation of manufacturing capacities: During Fiscals 2024, 2023 and 2022, our capacity utilization at our Dhule Facility was 89%, 85% and 74% respectively and during Fiscals 2024,2023 and 2022, our capacity utilization at our Kutch Facility was 81%, 94% and 88% respectively. Underutilization of our manufacturing capacities over extended periods or an inability to fully realize the benefits of our proposed capacity expansion, could adversely impact our business, and negatively impact the return on investment of the shareholders on their capital invested.

9. Risk in relation to Export Sales: Our Company exported its products to 49 countries across Asia, Africa, Middle East, Europe & Oceania and Americas, during Fiscal 2024. Our export sales for Fiscal 2024, 2023 and 2022 were Rs. 3,944.38 million, Rs. 3,776.73 million and Rs. 187.77 million constituting 35.53%, 29.96% and 3.65% respectively of our Gross Revenue from Operations. Our products may be subject to import duties or restrictions of the relevant geographies. Additionally, any adverse fluctuation in foreign exchange rate, unavailability of any fiscal benefits may have an adverse effect on our business.

10. Competition risk: We operate in a highly competitive industry where we face competition from other players. Competitive factors in our industry includes product quality, price, advertising and promotion, innovation of products. Accordingly, our inability to compete effectively with our competitors may have an adverse impact on our business.

11. Offer for sale portion: The Offer consists of a Fresh Issue and an Offer for Sale. The Selling Shareholders shall be entitled to the Net proceeds from the Offer for Sale, and our Company will not receive any proceeds from the Offer for Sale.

12. The average cost of acquisition of Equity Shares held by the Selling Shareholders ranges from Rs. 0.34 to Rs. 2.17 per Equity Share, and the Offer Price at upper end of the Price Band isRs.95.00.

13. Weighted average return on net worth for Fiscals 2024,2023 and 2022 is 30.22%. 14. Weighted average cost of acquisition of all Equity Shares transacted by the shareholders in the three years, eighteen months and one year preceding the date of the Prospectus is set forth below:

As certified by M/s Nahta Jain & Associates, independent chartered accountants pursuant to their certificate dated July 23, 2024.

(1) For Notes to the above table, please refer Page 32 of the Prospectus.

15. Weighted average cost of acquisition, Floor Price and Cap Price

16. The BRLM associated with the Offer has handled 8 public issues (Main Board-5, SME Issue-3) during current financial year and two financial years preceding the current financial year, none of issues were closed below the Offer price on the listing date.

17. The Price/Earnings Ratio based on diluted EPS for the Financial Year 2024 for the Company at the higher end of the Price Band is as high as 20.00 times and at the lower end of the Price Band is 18.95 times as compared to the average industry peer group PE ratio of 35.66 times.

The OfTerwas made through the Book Building Process in accordance with Regulation 6(1) of the SEB IIC D R Regulations wherein not more than 50% of the Offer was made available for allocation on a proportionate basis to Qualified Institutional Buyers ("QIBs") (the "QIB Portion'), provided that our Company in consultation with the BRLM allocated up to 60% of the QIB Portion to Anchor Investors and the basis of such allocation was done on a discretionary basis by our Company in consultation with the BRLM, in accordance with the SEBI ICDR Regulations (the "Anchor Investor Portion'), of which one-third was reserved for domestic Mutual Funds, subject to valid Bids being received from the domestic Mutual Funds at or above the price at which allocation was made to Anchor Investors ("Anchor Investor Allocation Price'). Further, 5% of the Net QIB Portion was made available for allocation on a proportionate basis to Mutual Funds only, subject to valid Bids being received at or above the Offer Price, and the remainderofthe Net QIB Portion was made available for allocation on a proportionate basis to all QIBs, including Mutual Funds, subject to valid Bids which was received at or above the Offer Price. Further, not less than 15% of the Offer was made available for allocation to Non-lnstitutional Investors (‘Non-lnstitutional Category') of which one-third of the Non-lnstitutional Category was made available for allocation to Bidders with an application size of more than Rs. 0.20 million and up to Rs. 1.00 million and two-thirds of the Non-lnstitutional Category was made available for allocation to Bidders with an application size of more than Rs. 1.00 million and under-subscription in either of these two sub-categories of the Non-lnstitutional Category allocated to Bidders in the other sub-category of the Non-lnstitutional Category in accordance with the SEBI ICDR Regulations, subject to valid Bids being received at or above the Offer Price. Further, not less than 35% of the Offer was made available for allocation to Retail Individual Investors ("Retail Category"), in accordance with the SEBI ICDR Regulations, subject to valid Bids received from them at or above the Offer Price. All Bidders (except Anchor Investors) were made to mandatorily participate in this Offer only through the Application Supported by Blocked Amount ("A SBA') process and provided details of their respective bank account (including UPI ID (defined hereinafter) in case of UPI Bidders (defined hereinafter) in which the Bid Amount which was blocked by the Self Certified Syndicate Banks ("SCSBs') or pursuant to the UPI Mechanism, as the case may be. Anchor Investors were not permitted to participate in the Anchor Investor Portion through the AS BA process.

The bidding for Anchor Investor opened and closed on July 18,2024. The Company received 13 applications from 12 Anchor Investors for 18,158,550 Equity Shares. The Anchor Investor Offer Price was finalized at Rs.95 per Equity Share. A total of 16,110,000 Equity Shares were allocated under the Anchor Investor Portion aggregating to Rs. 1,530,450,000.00/-. The Offer received 2,407,223 applications for 3,140,566,650 Equity Shares resulting in 58.48 times subscription. The details of the applications received in the Offer from Retail Individual Bidders, Non-lnstitutional Bidders and QIBs are as under (before technical rejections):

Final Demand

Asummary of the final demand as per NSE and BSE 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 NSE on July 24,2024.

A. Allotment to Retail Individual Bidders (After Technical Rejections) (including ASBA Applications)

The Basis of Allotment to the Retail Individual Bidders, who have bid at cut-off or at the Offer Price ofRs.95 per Equity Share, was finalized in consultation with NSE. This category has been subscribed to the extent of 23.54 times. The total number of Equity Shares Allotted in Retail Individual Bidders category is 18,795,000 Equity Shares to 125,300 successful applicants. The category-wise details of the Basis of Allotment are as under:

B. Allotment to Non-lnstitutional Bidders (m ore than Rs. 0.20 million and upto Rs.1.00 million) (After Technical Rejections) (including ASBA Applications)

The Basis of Allotment to the Non-lnstitutional Bidders (more than Rs 0.20 million and upto Rs.1 million), who have bid at the Offer Price of 7 95 per Equity Share or above, was finalized in consultation with NSE. This category has been subscribed to the extent of 109.69 times. The total number of Equity Shares allotted in this category is 2,685,000 Equity Shares to 1,193 successful applicants. The category-wise details of the Basis of Allotment are as under:

C. Allotment to Non-lnstitutional Bidders (m ore than 71.00 million) (After Technical Rejections) (including ASBA Applications)

The Basis of Allotment to the Non-lnstitutional Bidders (more than 71 million), who have bid at the Offer Price of 7.95 per Equity Share or above, was finalized in consultation with NSE. This category has been subscribed to the extent of 148.01 times. The total number of Equity Shares allotted in this category is 5,370,000 Equity Shares to 2,386 successful applicants. The category-wise details of the Basis of Allotment are as under: (Sample)

D. Allotment to QIBs (After Technical Rejections)

Allotment to QIBs, who have bid at the Offer Price of 7.95 per Equity Share or above, has been done on a proportionate basis in consultation with NSE. This category has been subscribed to the extent of 145.41 times of Net QIB portion. As per the SEBI Regulations, Mutual Funds were allotted 5% of the Equity Shares of Net QIB portion available i.e. 537,000 Equity Shares and other QIBs and unsatisfied demand of Mutual Funds were allotted the remaining available Equity Shares i.e. 10,203,000 Equity Shares on a proportionate basis. The total number of Equity Shares allotted in the QIB category is 10,740,000 Equity Shares, which were allotted to 104 successful Applicants.

E. Allotment to Anchor investors (After Technical Rejections)

The Company, in consultation with the BRLMs, have allocated 16,110,000 Equity Shares to 12 Anchor Investors (through 13 Anchor Investor Application Forms) (including 02 domestic Mutual Funds through 03 schemes) at an Anchor Offer Price at 7.95 per Equity Share in accordance with SEBIICDR Regulations.Thisrepresents6Q% of the QIB portion.

The Board of Directors of our Company at its meeting held on July 24, 2024 has taken on record the basis of allotment of Equity Shares approved by the Designated Stock Exchange, being NSE and has allotted the Equity Shares to various successful applicants. The Allotment Advice Cum Refund Intimation and/or notices have been dispatched to the address of the investors as registered with the depositories. Further, instructions to the SCSBs have been issued tor unblocking of funds and transfer to the Public Offer Account on July 24, 2024 and the payments to non-syndicate brokers have been issued on July 25, 2024. 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, 2024 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 BSE and NSE on July 25, 2024. The Company has received the listing and trading approval from BSE & NSE, and trading will commence on July 26,2024.

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

INVESTORS PLEASE NOTE

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

All future correspondence in th is regard may kindly be addressed tothe 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 tor, 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 SANSTAR LIMITED.

Sanstar Limited has filed the Prospectus dated July 24,2024 with the RoC. The Prospectus is made available on the website of the SEBI at www.sebi.gov.in as well as on the websites of the BRLM i.e., Pantomath Capital Advisors Private Limited at www.pantomathgroup.com, the website of the NSE at www.nseindia.com and the website of the BSE at www.bseindia.com and the website of the Company at https://www.sanstar.in/. Any potential investor should note that investment in equity shares involves a high degree of risk and for details relating to such risks, please seethe section titled ‘Risk Factors' beginning on page 34 of the Prospectus.

The Equity Shares offered in the Offer have not been and will not be registered under the U.S. Securities Actor any state securities laws in the United States, and unless so registered, and may not be offered or sold within the United States, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act and applicable U.S. state securities laws. Accordingly, the Equity Shares are being offered and sold outside the United States in offshore transactions in reliance on Regulation S and the applicable laws of each jurisdictions where such offers and sales are made. There will be no public offering of the Equity Shares in the United States.