RBZ Jewellers IPO Basis of Allotment

RBZ JEWELLERS LIMITED

Our Company was originally incorporated as ‘RBZ Jeweilers Private Limited' as a private limited company under the provisions of the Companies Act. 1956 pursuant to a certificate of corporate dated April 15.2008 issued by the Registrar of Companies. Gujarat. Dadra and Nagar Havelli Thereafter, our Company was converted to a public limited company, pursuant to a special resolution passed by our shareholders on February 25.2023 and the name of our Company was changed to "RBZ Jewellers Limited'and a fresh certificate of incorporation bearing U36910GJ2008PLC053586 dated March 20.2023 was issued to our Company by the Registrar of Companies. Ahmedabad. For details of change in the name and Registered and Corporate Office of our Company, see ‘History and Certain Corporate Matters' on page 201 of the Prospectus dated December 21, 2023 fled with the RoC (Prospectus).

Our Company has filed the Prospectus dated December 21, 2023 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 Wednesday, December 27,2023. All capitalized terms used and not defined herein shall have the respective meanings assigned to them in the Prospectus.

INITIAL PUBLIC ISSUE OF 1.00,00.000 EQUITY SHARES OF FACE VALUE OFT 10 EACH ("EQUITY SHARES') OF RBZ JEWELLERS LIMITED ("OUR COMPANY "OR THE "ISSUER") FOR CASH AT A PRICE OF T100/- PER EQUITY SHARE (INCLUDING A PREMIUM OF Rs. 90/- PER SHARE) ("ISSUE PRICE") AGGREGATING TO 110,000 LAKHS ("THE ISSUE"). THE ISSUE WILL CONSTITUTE 25% OF OUR POST-ISSUE PAID-UP EQUITY SHARE CAPITAL.

1. Negative Cash Flow: We have had negative cash flows from operating activities of Rs. 540.29 lakhs, Rs. 1,122.74 lakhs and Rs. 264.08 lakhs for the period ended on September 30,2023 and for the FY 2022-23 and FY 2020-21, respectively and may, in the future, experience similar negative cash flows. Negative cash flows over extended periods, or significant negative cash flows in the short term, could materially impact our ability to operate our business and implement our growth plans.

2. Significant working capital requirements: Our Company requires significant amount of working capital for continued growth. Our inability to meet our working capital requirements, on commercially acceptable terms, may have an adverse impact on our business, financial condition and results of operations.

As on September 30, 2023, our Company had a total sanctioned limit of Rs. 7,990.00 lakhs towards working capital loan facilities. The working capital requirements for the period ended September 30, 2023 and for the FY 2022-23, FY 2021-22 and FY 2020-21 was Rs. 17,111.27 lakhs, Rs. 14,947.22 lakhs, Rs. 11,078.20 lakhs and Rs. 9,618.16 lakhs, respectively which have been met by short-term borrowing and internal accruals.

3. Dependency on customers: We are dependent on our long-term relationship with our customers. In particular, we process substantial volume of gold for our customers for whom we work on jobwork basis. If such customers were to suffer a deterioration of their business, cease doing business with us or substantially reduce their dealings with us, our revenues could decline, which could have adverse effect on our business, financial condition and results of operations.

Our top 10 customers accounted for 19.27%, 20.68%, 27.19% and 38.74% of our total revenue from operations for the period ended September 30,2023 and for the FY 2022-23, FY 2021-22 and FY 2020-21, respectively.

4. The strength of our brand "RBZ Jewellers" along with "HaritZaveri" is crucial to our success and we may not succeed in continuing to maintain and develop our brand.

5. Ability to attract and retain skilled artisans: Our manufacturing capabilities depends on our ability to attract and retain highly skilled artisans and employees. As on date we do not have any formal arrangement with our in-house artisans and we may fail to retain skilled artisans which may affect our design quality and could also lead to decrease in our manufacturing output which may adversely impact our business, results of operations and financial condition.

6. Dependency on suppliers: We do not currently have exclusive or fixed supply arrangements with any of our suppliers of gold, though we are dependent on a few suppliers. Any major disruption to the timely and adequate supplies of our raw materials could adversely affect our business, results of operations and financial condition. In the six months period ended September 30,2023, Fiscal 2023, Fiscal 2022 and Fiscal 2021 we have met 58.37%, 62.35%, 81.93% and 81.10% of our total raw material needs relating to gold from our top 10 suppliers.

7. Inventory Management: Failure to manage our inventory could have an adverse effect on our net sales, profitability, cash flow and liquidity. Our total inventory for the period ended September 30, 2023 and for the FY 2022-23, FY 2021-22 and FY 2020-21 amounted to Rs. 17,820.67 lakhs, Rs. 14,924.12 lakhs, Rs. 11,906.11 lakhs and Rs.9,151.56 lakhs, respectively.

8. Our revenues have been significantly dependent on sale of gold jewellery and gold jewellery processed, which accounted for 88.26%, 87.96 %, 90.40 % and 88.35 % of our total revenue from operations for the six months period ended on September 30, 2023 and Fiscals 2023, 2022, 2021, respectively. Any factors adversely affecting the procurement of gold or our sales of gold jewellery may negatively impact our business, financial condition, results of operations and prospects.

9. Sales-mix: Our revenue and earnings are dependent on the sales mix consisting of retail and wholesale as well as provision of job work services and working capital requirements of each segment is different. If we are unable to balance or maintain this sales mix or balance working capital requirement for every segment in future, there could be an adverse impact on our business, financial condition and results of operations.

10. Machinery and technology: We are dependent on our machinery and technology for our operations. Any break-down of our machinery may disrupt our manufacturing process. If we fail to adopt new and improved technologies, our competitors may gain advantage over us. Both of these events may have an impact on our business, financial results and growth prospects. Our success and financial condition will depend on our ability to maximise our manufacturing capacities with the help of machinery and technologies.

11. Changes in demands and market trends: Our inability to respond to changes in demands and market trends in a timely manner and failure to expand our product offering in a diversified manner may have an adverse effect on our business, results of operations and financial condition.

12. Quality Control: Any failure to maintain our quality control processes in relation to our manufacturing facility as well as third-party manufacturing facilities, our inability to maintain or establish formal arrangements with third party manufacturers, and any disruptions at our manufacturing facility and/or such third-party manufacturing facilities, may have an adverse effect on our business, brand, results of operations and financial condition.

13. Delay in payment of Statutory Dues: Our Company has delayed in payment of statutory dues in the past under the statutory provisions of the IT Act, the Central Goods and Services Tax Act, 2017, the Employees Provident Funds and Miscellaneous Provisions Act, 1952 and for Employee State Insurance Act, 1948 ("ESI Act"). Such non-compliance and delayed compliance may attract penalties against our Company which could impact the financial position of us to that extent.

14. Concentration Risk: Our manufacturing facility and showroom are located only in Ahmedabad, Gujarat. Any adverse development affecting such region may have an adverse effect on our business, prospects, financial condition, and results of operations.

15. Our Promoters will continue to retain significant control in our Company, which will allow them to influence the outcome of matters submitted to shareholders for approval.

16. Our income and sales are subject to seasonal fluctuations and lower income in a peak season may have a disproportionate effect on our results of operations.

17. If we fail to convert existing customers into repeat customers or to acquire new customers, our business, financial condition, and results of operations could have an adverse effect.

18. Average cost of acquisition of Equity Shares by the Promoters is 1.35 and 0.82 per Equity Share and Issue Price at upper end of the Price Band is Rs. 100/- per Equity Share.

19. The weighted average return on Net Worth for Fiscals 2023,2022 and 2021 is 21.86%.

20. The weighted average cost of acquisition of all shares transacted in past one year, eighteen months and three years preceding the date of the RHP.

"Cost is Nil due to issuance of Equity Shares pursuant to bonus issue and transfer of shares by way of gift-as certified by G. K. Choksi &Co., Chartered Accountants, by way of their certificate dated December 02, 2023.

21. The BRLM associated with the Issue has handled 1 public issue in the past three years and the same has not closed below the offer price on listing date.

The Issue was made through the Book Building Process, in terms of Rule 19(2)(b) of the Secunties Contracts (Regulation) Rules. 1957. as amended ("SCRR"), read with Regulation 253 of the SEBIICDR Regulations and in compliance with Regulation 6(1) of the SEBIICDR Regulations, wherein not more than 35% of the Issue was available for allocation on a proportionate basis to Qualified Institutional Buyers ("QIBs" and such portion, the "QIB Portion"), provided that our Company in consultation with the Book Running Lead Manager, allocated up to 60% of the QIB Portion to Anchor Investors, on a discretionary basis (the Anchor Investor Portion''), of which one-third was reserved for the domestic Mutual Funds, subject to valid Bids being receded from the 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. In the event of under-subscription or non-allocation in the Anchor Investor Portion, the balance Equity Shares will be added to the QIB Portion (other than the Anchor Investor Portion) (the "Net QIB Portion").

Further, 5% of the Net QIB Portion was available for allocation on a proportionate basis to Mutual Funds only and the remainder of the Net QIB Portion was available for aBocation on a proportionate basts to all QIB Bidders, including Mutual Funds, subject to valid Bids being received at or above the Issue Price.

Further, not less than 30% of the Issue was available for allocation to Non-lnstitutional Bidders, out of which a) one third of such portion shall be reserved for applicants with application size of more than Rs. 2.00.000 and up to 110.00.000; and (b) two-third of such portion was reserved for applicants with application size of more than 110.00.000 in accordance with SEBI ICDR Regulations and not less than 35% of the Issue was available for allocation to Retail Individual Bidders in accordance with the SEBI ICDR Regulations, subject to valid Bids being received from them at or above the Issue Price. All Bidders (other than Anchor Investors) will only participate in the Issue through the Application Supported by Blocked Amount ("ASB A') process by providing details of their respective bank account and UPl ID in case UPl Bidders using the UPI Mechanism, as applicable, pursuant to which their corresponding Bid Amounts were blocked by the Self Certified Syndicate Banks ('SCSBs') or by the Sponsor Banks under the UPl Mechanism, as the case may be. to the extent of respective Bid Amounts. Anchor Investors were not permitted to participate in the Issue through the ASBA process. For details, see "Issue Procedure" on page 338 of the Prospectus.

The bidding for Anchor Investor opened and dosed on December 18,2023. The Company received 3 applications from 3 Anchor Investors for 31,00,200 Equity Shares. The Anchor Investor Issue Price was finalized at Rs.100 per Equity Share . Atotal of 21,00,000 Equity Shares were allocated under the Anchor Investor Portion aggregating to Rs. 21.00,00,000/-.

The Issue received 4,90,370 applications for 13,64,99.250 Equity Shares resulting in 13.65 times subscription as disclosed in the Prospectus. The details of the applications received in the Issue from Retail Individual Bidders, Non-lnstitutional Bidders and QIBs are as under (before technical rejections):

B. Allotment to Non-lnstitutional Bidders (more than 70.20 million and upto 71 million) (After Technical Rejections) (including ASBA Applications)

The Basis of Allotment to the Non-lnstitubonal Bidders (more than 70.20 milion and upto 71 million), who have bid at the Issue Price of 7 100 per Equity Share or above, was finalized in consultation with BSE. This category has been subscribed to the extent of 14.10 times. The total number of Equity Shares allotted in this category is 10.00,000 Equity Shares to 476 successful applicants. The category-wise details of the Basis of Allotment are as under:

C. Allotment to Non-lnstitutional Bidders (more than Rs.1 million) (After Technical Rejections) (including ASBA Applications)

The Basis of Allotment to the Non-lnstitutional Bidders (more than Rs.1 million), who have bid at the Issue Price of T100 per Equity Share or above, was finalized in consultation with BSE. This category has been subscribed to the extent of 6.63 times. The total number of Equity Shares allotted in this category is 20,00,000 Equity Shares to 952 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 Issue Pnce of Rs. 100 per Equity Share or above, has been done on a proportionate basis in consultation with BSE. This category has been subscribed to the extent of 13.26 times of Net QIB portion. The total number of Equity Shares allotted in the QIB category is 14,00.000 Equity Shares, which were allotted to 7 successful Applicants.

E. Allotment to Anchor Investors (After Technical Rejections)

The Company, in consultation with the BRLM, have allocated 21.00.000 Equity Shares to 3 Anchor Investors (through 3 Anchor Investor Application Forms) at an Anchor Investor

Issue Price at Rs. 100 per Equity Share in accordance with SEBIICDR Regulations. This represents 60% of the Q IB portion.

The Board of Directors of our Company at its meeting held on December 22,2023 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 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 Issue Account on December 26.2023 and the payments to non-syndicate brokers have been issued on December 26.2023. In case the same is not received within ten days, investors may contact the Registrar to the Issue at the address given below. The Equity Shares allotted to the successful allottees have been uploaded on December 26.2023 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 BSE and NSE on December 26, 2023 The Company has received the listing and trading approval from BSE & NSE. and trading will commence on December 27,2023.

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 Issue, Bigshare Services Private Limited at www.bigshareonline.com.

All future correspondence in this regard may kindly be addressed to the Registrar to the Offer quoting full name of the First¹ 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 RBZ JEWELLERS LIMITED.

RBZ JEWELLERS LIMITED has filed a Prospectus dated December 21.2023 with the Registrar of Companies, Ahmedabad on December 22,2023. The Prospectus is made available on the website of the SEBI at www.sebi.gov.in as well as on the website of the BRLM i.e., Anhant Capital Markets Limited at www.arihantcapital.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 www.rbzjewellers.com. Any potential investor should note that investment in equity shares involves a high degree of risk and for details relating to such risks, please see the section titled Risk Factors "beginning on page 32 of the Prospectus Potential investors should not rely on the DRHP for making any investment decision but can only rely on the information included in the Prospectus.

The Equity Shares offered in the Offer have not been and will not be registered under the U.S. Securities Act of 1933. as amended ('U.S. Securities Act'), or any state law of the United States and. unless so registered, 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 state securities laws. Accordingly, the Equity Shares are being offered and sold (i) within the United States only to persons reasonably believed to be 'qualified institutional buyers' (as defined in Rule 144Aunderthe U.S. Securities Act) under Section 4(a) of the U.S. Securities Act. and <i) outside the United States in 'offshore transactions' as defined in and in compliance with Regulation S under the U.S. Securities Act and the applicable laws of the jurisdiction where those offers and sales are made. There will be no public offering of the Equity Shares in the United States.