Sai Silks (Kalamandir) IPO Basis of Allotment

SAI SILKS (KALAMANDIR) LIMITED

Our business was started as a partnership firm under the name and style of "Sai Silks" on August 10,2005 with Nagakanaka Durga Prasad Chalavadi and Jhansi Rani Chalavadi as its partners. Subsequently. Kalyan Srinlvas Annam and Subash Chandra Mohan Annam joined the partnership firm on Apnl 1,2006 and Suchitra Annam, Sowjanya Annam and Venkata Rajesh Annam joined on March 4,2008 Further, the name of the partnership firm was also changed to "Sai Silks (Kalamandir)' on March 4.2008 to incorporate the brand in its name. The partnership firm was subsequently converted into a private limited company and a certificate of incorporation was obtained dated July 3,2008 under the name and style of ‘Sai Silks (Kalamandir) Private Limited' from the Registrar of Companies, Andhra Pradesh at Hyderabad. Our Company was further converted into a public limited company pursuant to a special resolution passed by our Shareholders on May 14.2009 and a fresh certificate of incorporation consequent upon conversion to public limited company was obtained on May 21,2009 from the Registrar of Companies. Andhra Pradesh. The name of our Company was changed to its present name, Sai Sdks (Kalamandir) Limited'. For details of changes in the name and the registered office address of our Company, see *History and Certain Corporate Matters" on page 205 of the Prospectus dated September 23.2023 read along with Corrigendum below ("Prospectus").

THE COMMENCEMENT OF TRADING OF THE EQUITY SHARES OF OUR COMPANY ON THE STOCK EXCHANGES SHALL BE WITH EFFECT FROM WEDNESDAY, SEPTEMBER 27, 2023 (I.E. T+3 DAYS, T BEING THE BID/OFFER CLOSING DATE). OUR COMPANY HAS VOLUNTARILY DECIDED FOR LISTING IN TERMS OF THE TIMELINES PRESCRIBED UNDER THE SEBI CIRCULAR NO. SEBI/HO/CFD/TPD1/CIR/P/2023/140 DATED AUGUST 9, 2023, WHICH REDUCED THE TIMELINE FOR LISTING OF EQUITY SHARES IN PUBLIC ISSUE FROM EXISTING T+6 DAYS TO T+3 DAYS.

Our Company has filed the Prospectus with the RoC on September 23, 2023 and the Equity Shares are proposed to be listed on the Main Board of BSE Limited ("BSE") and the National Stock Exchange of India Limited ("NSE") and the trading will commence on Wednesday. September 27.2023.

INITIAL PUBLIC OFFERING OF 5,40,99,027 EQUITY SHARES OF FACE VALUE OF *2 EACH ("EQUITY SHARE") OF SAI SILKS (KALAMANDIR) LIMITED (OUR "COMPANY" OR THE "ISSUER") FOR CASH AT A PRICE OF *222 PER EQUITY SHARE INCLUDING A SHARE PREMIUM OF *220 PER EQUITY SHARE (THE "OFFER PRICE") AGGREGATING TO *12,009.98 MILLION (THE "OFFER"). THE OFFER COMPRISED OF A FRESH ISSUE OF 27,027,027 EQUITY SHARES BY OUR COMPANY AGGREGATING TO *6,000.00 MILLION (THE "FRESH ISSUE") AND AN OFFER FOR SALE OF 27,072,000 EQUITY SHARES (THE "OFFERED SHARES") AGGREGATING TO *6,009.98 MILLION (THE "OFFER FOR SALE"), COMPRISING OFFER FOR SALE OF (A) 6,409,345 EQUITY SHARES AGGREGATING TO *1,422.87 MILLION BY NAGAKANAKA DURGA PRASAD CHALAVADI, 7,949,520 EQUITY SHARES AGGREGATING TO *1,764.79 MILLION BY JHANSI RANI CHALAVADI (COLLECTIVELY, THE "PROMOTER SELLING SHAREHOLDERS"), AND (B) 3,083,865 EQUITY SHARES AGGREGATING TO *684.62 MILLION BY DHANALAKSHMI PERUMALLA, 656,295 EQUITY SHARES AGGREGATING TO *145.70 MILLION BY DOODESWARA KANAKA DURGARAO CHALAVADI, 6,346,975 EQUITY SHARES AGGREGATING TO *1,409.03 MILLION BY KALYAN SRINIVAS ANNAM, 2,120,500 EQUITY SHARES AGGREGATING TO Rs. 470.75 MILLION BY SUBASH CHANDRA MOHAN ANNAM AND 505,500 EQUITY SHARES AGGREGATING TO *112.22 MILLION BY VENKATA RAJESH ANNAM (COLLECTIVELY THE "PROMOTER GROUP SELLING SHAREHOLDERS" AND TOGETHER WITH THE PROMOTER SELLING SHAREHOLDERS, THE "SELLING SHAREHOLDERS") (THE "OFFER FOR SALE. AND TOGETHER WITH THE FRESH ISSUE. THE "OFFER"). THE OFFER CONSTITUTES 35.27% OF THE POST-OFFER PAID-UP EQUITY SHARE CAPITAL OF OUR COMPANY.

Risk Factors Associated with our Company

Valuation Risk: The market capitalization to total revenue from operations, which is 2.52 times the cap price and the price to earnings ratio, which is 27.37 times the cap price may not be indicative of the market price of the Equity Shares on listing and may be subject to significant fluctuations in response to, among other factors, variations in our operating results, market conditions specific to the industry we operate in, etc.

Business Concentration Risk: Our business is highly concentrated on the sale of women's sarees and contributed to 68.38%, 67.36% and 65.70% of our revenue from operations for Fiscals 2023, 2022 and 2021 respectively. The business is vulnerable to variations in demand and changes in consumer preference, could have an adverse effect on our business, results of operations and financial condition.

Geographic Concentration Risk: We generated substantially all of our sales from stores located in Southern India and any adverse developments affecting our operations in these regions could have an adverse impact on our revenue and results of operations. For instance, our revenue from state of Telangana, Andhra Pradesh, Tamil Nadu and Karnataka in Fiscal 2023 was ^6,064.35 million, Rs.4,429.38 million, Rs.1,218.70 million and Rs.1,802.26 million respectively. Share Pledge Risk: As on the date of the Prospectus, 21,437,500 Equity Shares held by our Promoter, Nagakanaka Durga Prasad Chalavadi, constituting 31.33% of the fully diluted equity share capital collectively held by the Promoters of our Company, were pledged in favor of State Bank of India, pursuant to sanction letters dated December 5,2017, March 8,2019, March 10,2020, March 20,2021, March 5,2022 and March 20,2023, to secure the borrowing obligations of our Company with the lender. However, pursuant to the letter dated October 20, 2022 from State Bank of India, such Equity Shares have been temporarily released from pledge for completion of the lock-in requirements as prescribed under the SEBIICDR Regulations and will be subsequently re-pledged, subject to the provisions of the applicable law, with the Depositories post listing of the Equity Shares on the Stock Exchanges Any default under the loan agreements following the creation of a pledge on the Equity Shares of our Company may result in, inter alia, reduction on the aggregate shareholding of our Promoter, the lender taking ownership of the pledged shares.

5. Litigation Risk: The Income Tax Department has conducted a "search, survey and seizure operation" at our Registered and Corporate Office, certain of our stores and warehouses and on the residence of our Promoters, Whole-time Directors and Key Managerial Personnel. Any adverse outcome of such proceedings may have an adverse effect on our business, financial condition and result of operations. Further, our Company, Directors, Promoters and Group Companies are or may be involved in certain legal and regulatory proceedings. Any adverse decision in such proceedings may have a material adverse effect on our business, financial condition, cash flows and results of operations.

II. Weighted average cost of acquisition of all Equity Shares transacted in past one year, eighteen months and three years preceding the date of the Prospectus.

III. Weighted Average Return on Net Worth attributable to the owners of the company (RoNW), as derived from Restated Financial Information for the fiscals 2021,2022 and 2023 is 19.03%.

Notes:

(1) "Net worth" means the aggregate value of the paid-up share capital and all reserves created out of the profits and securities premium account and debit or credit balance of profit and loss account, after deducting the aggregate value of the accumulated losses, deferred expenditure and miscellaneous expenditure not written off, as per the restated balance sheet, but does not include reserves created out of revaluation of assets, capital reserve, write-back of depreciation and amalgamation as per the SEBIICDR Regulations as at March 31, 2023, March 31,2022 and March 31,2021.

(2) Return on Net worth (%) = Restated Profit for the year divided by Net worth as at the end of the year.

(3) Weighted Average = Aggregate of year-wise weighted Return on Net worth divided by the aggregate of weights i.e. (Return on Net worth x Weight) for each year/Total of weights

IV. Weighted average cost of acquisition ("WACA"), floor price and cap price:

As certified by our StatutoryAuditors, by way of their certificate dated September 23,2023 * The Company has issued 6,016,145 shares of face value ofRs. 2 each atRs. 22 per share to SSKL Employees Trust on June 09,2022. The same was not taken into consideration as primary allotment for determination of Weighted Average Cost of Acquisition (WACA). Further, there have been no primary/new issue of shares (Equity Shares/convertible securities), excluding grants of any options and issuance of bonus shares, equal to or more than 5% of the fully diluted paid-up share capital of our Company (calculated on the pre-issue capital before such transaction and excluding employee stock options granted but not vested), in a single transaction or multiple transactions (combined together over a span of rolling 30 days) during 18 months preceding the date of filing of the Prospectus.

"The secondary transactions which took place among the Promoters, Promoter Group and Selling Shareholders during the last three years were done by way of gifting of shares among themselves and therefore no consideration was taken into consideration for determination of weighted average cost of acquisition.

V. The Three BRLMs associated with the Offer have handled 34 public Issues in the past three years, out of which 12 Issues closed below the offer price on listing date.

*lssues handled where there were no common BRLMs

The Offer was made through the Book Building Process. In terms of Rule 19(2)(b) of the Secunties Contracts (Regulation) Rules, 1957, as amended (the "SCRR"), read with Regulation 31 of the SEBI ICDR Regulations and in compliance with Regulation 6(1) of the SEBI ICDR Regulations wherein not more than 50% of the Offer was made available for allocation on a proportionate basis to Qualified Institutional Buyers ("QIBs"). and such portion. "QIB Portion") provided that our Company, in consultation with the BRLMs. allocated up to 60% of the QIB Portion to Anchor Investors on a discretionary basis in accordance with the SEBI ICDR Regulations ("Anchor Investor Portion"), of which one-third was reserved for domestic Mutual Funds, subject to valid Bids having been received from domestic Mutual Funds at or above the price at which allocation was made to Anchor Investors ( Anchor Investor Allocation Price"). Further. 5% of the QIB Portion (excluding the Anchor Investor Portion) was made available for allocation on a proportionate basis only to Mutual Funds and the remainder of the QIB Portion (excluding the Anchor Investor Portion) was made available for allocation on a proportionate basis to all QIBs (other than Anchor Investors), including Mutual Funds, subject to valid Bids having been received at or above the Offer Price. Further, not less than 15% of the Offer was made available for allocation on a proportionate basis to Non-lnstitutional Bidders (Non-lnstitutional Category") of v/hich (a) one-third of the Non-lnstitutional Category was made available for allocation to Bidders with an application size of more than Rs. 200.000 and up to Rs. 1,000.000 and (b) two-thirds of the Non-lnstitutional Category was made available for allocation to Bidders with an application size of more than Rs. 1.000.000, and undersubscription in either of these two sub-categories of Non-lnstitutional Category was allocated to Bidders in the other sub-category of Non- I

Institutional Category in accordance with the SEBI ICDR Regulations, subject to valid Bids having been received at or above the Offer Price. I

Further, not less than 35% of the Offer was made available for allocation to Retail Individual Investors ("Retail Category"), in accordance with the I SEBI ICDR Regulations, subject to valid Bids having been received from them at or above the Offer Price. All Bidders ^except Anchor Investors) I mandatorily participated in this Offer only through the Application Supported by Blocked Amount (" ASBA") process, and provided details of their respective bank account (including UPI ID in case of UPI Bidders) in which the Bid Amount v/as blocked by the Self Certified Syndicate Banks ("SCSBs") or the Sponsor Banks, as the case may be. Anchor Investors were not permitted to participate in the Anchor Investor Portion through the ASBA process. For details, see 'Offer Procedure' on page 400 of the Prospectus.

The bidding for Anchor Investor opened and closed on Monday, September 18, 2023. The Company received 26 Anchor Investor Application Forms from 15 Anchor Investors (including 8 Domestic Mutual Funds through 16 Mutual Fund schemes) for 17,595,540 Equity Shares. Such 15 Anchor Investors through 26 Anchor Investor Application Forms were allocated 16,229,707 Equity Shares at a price of Rs. 222 per Equity Share under the Anchor Investor Portion, aggregating to Rs. 3,602.994.954.00.

The Offer received 138.673 applications for 187,054.285 Equity Shares (prior to rejections) resulting in 3.46 times subscription. The details of the applications received in the Offer from various categories 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 as at different Bid prices is as under:

The Basis of Allotment was finalized in consultation with the Designated Stock Exchange, being BSE on September 25.2023.

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 the Cut-Off Price or at the Offer Price of V222 per Equity Share, was finalized in consultation with the BSE. This category has been subscribed to the extent of 0.871 times. The total number of Equity Shares Allotted in Retail Portion is 16,487,427 Equity Shares to 125,408 successful Retail Individual Bidders. The category-wise details of the Basis of Allotment are as under:

B. Allotment to Non-lnstitutional Investors (more than Rs.0.20 million and upto Rs.1 million) (After Rejections) (including ASBA Applications)

The Basis of Allotment to the Non-lnstitutional Bidders (more than 10.20 million and up to Rs.1.00 million), who have bid at the Offer Price of Rs. 222 per Equity Share, was finalized in consultation with BSE. This category has been subscribed to the extent of 1.44 times. The total number of Equity Shares allotted in this category is 2,893,201 Equity Shares to 3.084 successful applicants, The category-wise details of the Basis of Allotment are as under: (Sample)

Includes spill-over of 188.249 Equity Shares from Retail Category. Additional 1 share will be allotted to successful allotees from Sr. no. 2 to 34 = 230 shares. Additional 1 share will be allotted to successful allotees from Sr. no. 2 to 34 = 179 shares

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

The Basis of Allotment to the Non-Institutional Bidders (more than Rs.1 .00 million), who have bid at the Offer Price of 1222 per Equity Share, was finalized in consultation with BSE. This category has been subscribed to the extent of 2.82 times. The total number of Equity Shares allotted in this category is 5,786,400 Equity Shares to 3,031 successful applicants The category-wise details of the Basis of Allotment are as under (Sample)

Includes spill-over of 376.497 Equity Shares from Retail Category.

D. Allotment to QIBs

Allotment to QIBs, who have Bid at the Offer Price of Rs. 222 per Equity Share, has been done on a proportionate basis in consultation with the BSE. This category has been subscribed to the extent of 12.159 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.. 635,115 Equity Shares (includes 94.125 Equity Shares from Retail Individual Bidders Category) and other QIBs were Allotted the remaining available Equity Shares i.e. 12.067.177 Equity Shares (includes 1.788,362 Equity Shares from Retail Individual Bidders Category) on a proportionate basis. The total number of Equity Shares Allotted in the Net QIB Portion (including Mutual Funds) is 12,702,292 Equity Shares, which were allotted to 44 successful QIB Bidders (including Mutual Funds). The category-wise details of the Basis of Allotment are as under:

Includes spillover of 1,882,487 Equity Shares from Retail Category

E. Allotment to Anchor Investors

The Company, in consultation with the BRLMs. have allocated 16.229,707 Equity Shares to 15 Anchor Investors (through 26 Application Forms) at the Anchor Investor Offer Price of Rs. 222 per Equity Share in accordance with the SEBI ICDR Regulations. This represents 60% of the QIB Portion.

The IPO Committee of our Company on September 25, 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 Bidders. The Allotment Advice-cum-Intimations and/or notices have been dispatched to the address of the investors as registered with the depositories. Further, the instructions to the Self Certified Syndicate Banks for unblocking of funds, transfer to Public Offer Account have been issued on September 25. 2023 and payment to non-Syndicate brokers have been issued on September 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 September 25. 2023 for credit into the respective beneficiary accounts subject to validation of the account details with the depositones concerned. The Company has filed the Listing application with BSE and NSE on September 25, 2023, The Company has received listing and trading approval from BSE and NSE and the trading will commence on September 27, 2023.

Note: All capitalised terms used and not specifically defined herein shall have the same meaning as ascribed to them in the Prospectus

The details of the allotment made will be hosted on the website of the Registrar to the Offer, 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 First/ sole Bidder. Bid cum Application Form number. Bidder DP ID. Client ID. PAN. date of submission of Bid cum Application Form, address of the Bidder, number of Equity Shares applied for. the name and address of the Designated Intermediary where the Bid cum Application Form was submitted by the Bidder and a copy of the Acknowledgment Slip received from the Designated Intermediary at the address given below:

	Bigshare Services Private Limited
	Office No S6-2, 6 Floor, Pinnade Business Park.
	Next to Ahura Centre, Mahakali Caves Road, Andheri (East) Mumbai - 400093
	Telephone 022 62638200 E-mail: ipo@bigshareonline.com
	Investor Grievance e-mail : investor@bigshareonlme.com
	Website: www.bigshareonline com
	Contact Person: Jibu John
	SEBI Registration No : INR000001385

Attention of investors is drawn to the disclosure of the number of Equity Shares available for allocation to Non-Institutional Bidders with an application size of more than Rs. 2.00.000 to Rs. 10.00,000 appearing on page 63 of the Prospectus. At such page the number of Equity Shares should be read as 2,704.952 Equity Shares instead of 2.704.956 Equity Shares.

The Prospectus shall be read in conjunction with this Corrigendum (the "Corrigendum'). The information in this Corrigendum supersedes the information provided in the Prospectus to the extent inconsistent with the information in the Prospectus The Prospectus stands amended to the extent stated hereinabove.

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 SAI SILKS (KALAMANDIR) LIMITED.

SAI SILKS (KALAMANDIR) LIMITED is proposing, subject to receipt of requisite approvals, market conditions and other considerations to undertake an initial public offer of its Equity Shares and has filed the Prospectus with RoC. The Prospectus is available on the website of SEBI at www.sebi.gov.in as well as on the websites of the Stock Exchanges i e. BSE at www.bsemdia.com and NSE at www nseindia.com. the Company at www.sskl.co.in and is available on the website of the BRLMs, i.e. Motilal Oswal Investment Advisors Limited at www,motilaloswalgroup.com, HDFC Bank Limited at wwwhdfcbank.com and Nuvama Wealth Management Limited (formerly known as Edelweiss Secunties Limited) at www nuvama com Any potential investor should note that investment in equity shares involves a high degree of risk and for details relating to such risk, see *Risk Factors" beginning on page 28 of the Prospectus.

The Equity Shares have not been and will not be registered under the U.S. Securities Act of 1933 (the ' U.S. Securities Act ') or any state secunties laws in 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. Secunties Act and applicable U.S. state secunties 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.