Visagar Financial Services : Letter of offer (Final Offer Document filed with Stock Exchanges)

Letter of Offer

January 03, 2023

For Eligible Equity Shareholders only

Visagar Financial Services Limited

Corporate Identification Number: L99999MH1994PLC076858

Our company was originally incorporated as 'INCA Finlease Private Limited' at Mumbai on March 01, 1994 with Registrar of Companies, Mumbai. Subsequently, it was converted to a Public Limited via EGM resolution dated May 28, 1994 and obtained fresh certificate upon conversion of the Company from Private Limited to Public Limited from The Registrar of Companies, Mumbai on July 08, 1994. The Company got listed on BSE Limited on August 25, 1995. Subsequently, the name of our Company was changed to 'Visagar Financial Services Limited' on February 11, 2011 vide fresh certificate of Incorporation. For details, including reasons for changes in the name and registered office of our Company, see General Information on page 42 of this Letter of Offer.

Registered Office: 907-908, Dev Plaza, 9th Floor, S.V. Road, Andheri (West), Mumbai - 400 058; Tel. No.: [phone]; Email:

[e-mail] ; Website: www.vfsl.org;Contact Person: Ms. Sonam Prajapati, Company Secretary & Compliance Officer

OUR PROMOTER: MR. TILOKCHAND MANAKLAL KOTHARI and SIBSAGAR TRADE AND AGENCIES PRIVATE LIMITED FOR PRIVATE CIRCULATION TO THE ELIGIBLE EQUITY SHAREHOLDERS OF VISAGAR FINANCIAL SERVICES LIMITED (THE "COMPANY" OR THE "ISSUER") ONLY

ISSUE OF UP TO 49,73,87,700 UP EQUITY SHARES WITH A FACE VALUE OF RE. 1.00 EACH ("RIGHTS EQUITY SHARES") OF OUR COMPANY FOR CASH AT A PRICE OF RE. 1.00 PER RIGHTS EQUITY SHARE ("ISSUE PRICE") FOR AN AGGREGATE AMOUNT UP TO Rs. 49.73 CRORES* ON A RIGHTS BASIS TO THE ELIGIBLE EQUITY SHAREHOLDERS OF OUR COMPANY IN THE RATIO OF 51 (FIFTY- ONE) RIGHTS EQUITY SHARES FOR EVERY 10 (TEN) FULLY PAID-UP EQUITY SHARES HELD BY THE ELIGIBLE EQUITY SHAREHOLDERS ON THE RECORD DATE, THAT IS ON FRIDAY, DECEMBER 30, 2022 (THE "ISSUE"). THE ISSUE PRICE FOR THE RIGHTS EQUITY SHARES IS 1.00 TIMES THE FACE VALUE OF THE EQUITY SHARES. FOR FURTHER DETAILS, SEE "TERMS OF THE ISSUE" ON PAGE 224.

*Assuming full subscription and receipt of Application Monies with respect to Rights Equity Shares.

WILFUL DEFAULTER OR FRAUDULENT BORROWER

Neither our Company nor any of our Promoters or Directors has been categorized as a Wilful Defaulter or Fraudulent Borrowers by any bank or financial institution (as defined under the Companies Act, 2013) or consortium thereof, in accordance with the guidelines issued by the Reserve Bank of India.

GENERAL RISK

Investment in equity and equity related securities involve a degree of risk and investors should not invest any funds in this Issue unless they can afford to take the risk with such investment. Investors are advised to read the risk factors carefully before taking an investment decision in this Issue. For taking an investment decision, investors must rely on their own examination of our Company and the Issue including the risks involved. The Rights Equity Shares 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 Document. Specific attention of investors is invited to the statement of "Risk Factors" on page 22 before making an investment in this Issue

ISSUER'S ABSOLUTE RESPONSIBILITY

Our Company, having made all reasonable inquiries, accepts responsibility for and confirms that this Letter of Offer contains all information with regard to our Company and the Issue which is material in the context of the Issue, that the information contained in this Letter of Offer 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 Letter of Offer as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.

LISTING

The existing Equity Shares are listed on the BSE Limited ("BSE") (the "Stock Exchange"). Our Company has received 'in-principle' approval from the BSE for listing the Rights Equity Shares to be allotted pursuant to this Issue vide its letters dated November 17, 2022. Our Company will also make an application to the Stock Exchange to obtain the trading approval for the Rights Entitlements as required under the SEBI circular (SEBI/HO/CFD/DIL2/CIR/P/2020/13) dated January 22, 2020. For the purpose of this Issue, the Designated Stock Exchange is BSE.

REGISTRAR TO THE ISSUE	ADROIT CORPORATE SERVICES PRIVATE LIMITED
	Address: 18-20, Jafarbhoy Industrial Estate, 1st Floor, Makawana Road,
	Marol Naka, Andheri ( East), Mumbai 400 059
	Tel. No.: [phone]
	Email: [e-mail]
	Investor Grievance Email: [e-mail]
	Website: www.adroitcorporate.com
	Contact Person: Ms. Diviya Nadar
	SEBI Registration No.: INR000002227

	ISSUE PROGRAMME
ISSUE OPENS ON: JANUARY	LAST DATE FOR ON MARKET RENUNCIATION:	ISSUE CLOSES ON: FEBRUARY 02,
12, 2023; THURSDAY	JANUARY 25, 2023; WEDNESDAY*	2023; THURSDAY#

• Eligible Equity Shareholders are requested to ensure that renunciation through off-market transfer is completed in such a manner that the Rights Entitlements are credited to the demat account of the Renouncees on or prior to the Issue Closing Date.
  # Our Board or a duly authorized committee thereof will have the right to extend the Issue period as it may determine from time to time but not exceeding 30 (thirty) days from the Issue Opening Date (inclusive of the Issue Opening Date). Further, no withdrawal of Application shall be permitted by any Applicant after the Issue Closing Date.

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TABLE OF CONTENTS
TITLE	PAGE NO.
SECTION I - GENERAL
Definitions And Abbreviations	4
Notice To Investors	13
Presentation Of Financial And Other Information	15
Forward Looking Statements	17
Summary Of This Letter of Offer	19
SECTION II - RISK FACTORS	22
SECTION III - INTRODUCTION
The Issue	41
General Information	42
Capital Structure	48
Objects Of The Issue	53
Statement Of Special Tax Benefits	58
SECTION IV - ABOUT OUR COMPANY
Industry Overview	62
Our Business	72
Our Management	79
SECTION V - FINANCIAL INFORMATION
Financial Statements	82
Accounting Ratios	197
Management's Discussion And Analysis Of Financial Condition And Results Of Operations	200
SECTION VI - LEGAL AND OTHER INFORMATION
Outstanding Litigation And Defaults	211
Government And Other Statutory Approvals	215
Material information and Developments	216
Other Regulatory And Statutory Disclosures	217
SECTION VII - ISSUE RELATED INFORMATION
Terms Of The Issue	224
Restrictions On Foreign Ownership Of Indian Securities	250
SECTION VIII - OTHER INFORMATION
Material Contracts And Documents For Inspection	254
Declarations	255

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SECTION I - GENERAL DEFINITIONS AND ABBREVIATIONS

This Letter of Offer uses certain definitions and abbreviations which, unless the context otherwise indicates or implies or unless otherwise specified, shall have the meaning as provided below, which you should consider when reading the information contained herein.

References to any legislation, act, regulation, rules, guidelines or policies shall be to such legislation, act, regulation, rules, guidelines or policies as amended, supplemented, or re-enacted from time to time and any reference to a statutory provision shall include any subordinate legislation made from time to time under that provision.

The words and expressions used in this Letter of Offer, but not defined herein shall have, to the extent applicable, the meaning ascribed to such terms under the SEBI ICDR Regulations, the Companies Act, the SCRA, the Depositories Act, and the rules and regulations made thereunder. Notwithstanding the foregoing, terms used in "Statement of Special Tax Benefits, Financial Statements, Industry Overview, Summary of this Letter of Offer, Outstanding Litigation and Material Information and Developments and Issue Related beginning on pages 58, 82, 62, 19 and 216, respectively, shall have the meaning given to such terms in such sections.

1. GENERAL TERMS

Visagar Financial Services Limited

• VISAGAR / VFSL / The Company/ Company/ We/ Us/ Our/ our Company/ the Issuer Company

Unless the context otherwise indicates or implies refers to Visagar Financial Services Limited, a public limited company incorporated under the provisions of the Companies Act, 1956 having its registered office at 907-908, Dev Plaza, 9th Floor, S.V. Road, Andheri (West), Mumbai - 400 058, Maharashtra, India

II. COMPANY RELATED TERMS
TERM	DESCRIPTION
Act/ Companies Act	The Companies Act, 2013 and Companies Act, 1956 to the extent applicable.
Articles / Articles of Association /	The Articles of Association of our Company, as amended from time to time
AoA
	The statutory auditor of our Company, being M/s. Bhatter And Associates,
Auditor / Statutory Auditor	Chartered Accountants
Audited Financial Statements/	Audited Financial Statements refers to the audited report for the Financial
Audit Reports	Years ending on March 31, 2022 and 2021 and half yearly ending on
September 30, 2022
Board/ Board of Directors	Board of Directors of our Company, including any committees thereof
Chief Financial Officer	Chief financial officer of our Company, being Ms. Ankita Rai
Company Secretary & Compliance	Company Secretary & Compliance Officer of our Company in this case
Officer	being, Ms. Sonam Prajapati
Director(S)	The Director(s) on the Board of our Company, unless otherwise specified
Equity Shareholder/ Shareholders	A holder of Equity Shares
Equity Shares	The equity shares of our Company of a face value of Re. 1.00 each, unless
otherwise specified in the context thereof.
	The independent director(s) of our Company, in terms of Section 2(47) and
Independent Director(s)	Section 149(6) of the Companies Act and Regulation 16(1)(b) of the SEBI
	Listing Regulations.
ISIN of our Company	International Securities Identification Number being INE309H01038
ISIN for Right Entitlements	International Securities Identification Number for Rights Entitlement being
	INE309H20012
Key Management Personnel / KMP	Key management/ managerial personnel of our Company in accordance
	with Regulation 2(1)(bb) of the SEBI ICDR Regulations and as described
	in "Our Management - Key Managerial Personnel" on page no. 79.
Memorandum / Memorandum of	Memorandum of association of our Company, as amended from time to time
Association / MoA
Promoter(s)	Mr. Tilokchand Manaklal Kothari and Sibsagar Trade And Agencies
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TERM		DESCRIPTION
	Private Limited
	Persons and entities forming part of the promoter group of our Company
	as determined in terms of Regulation 2(1)(pp) of the SEBI ICDR
	Regulations and as disclosed by our Company in the filings made with the
	Stock Exchange under the SEBI Listing Regulations. The name of
	Promoter Group is as follows:
	1)	Mr. Sagar Kothari
	2)	Mrs. Asha Kothari
Promoter Group	3)	Mr. Vishal Kothari
4)	Tilokchand Manaklal Kothari HUF
	5)	Trisha Studios Limited
	6)	Shalimar Productions Limited
	7)	Jagrecha Finance And Trades Private Limited
	8)	Sagar Portfolio Services Limited
	9)	Maharashtra Corporation Limited
	10)	Visagar Polytex Limited
	11)	Saraswati Educare Foundation
Registered Office	The registered office of our Company located at 907-908, Dev Plaza, 9th
Floor, S.V. Road, Andheri (West), Mumbai - 400 058, Maharashtra, India
Registrar of Companies/ / Registrar	The Registrar of Companies, Maharashtra situated at 100, Everest, Marine
of Companies, Maharashtra/ RoC	Drive, Mumbai-400 002, Maharashtra, India.
Secretarial Auditor of the	M/s VRG & Associates, Practicing Company Secretaries

Company
III. ISSUE RELATED TERMS
TERM	DESCRIPTION
Abridged Letter of Offer /	The abridged letter of offer to be sent to the Eligible Equity Shareholders of our
ALOF	Company with respect to this Issue in accordance with the SEBI ICDR
	Regulations and the Companies Act.
Additional Rights Equity	The Rights Equity Shares applied or allotted under this Issue in addition to the
Shares	Rights Entitlement
Allot / Allotted / Allotment	Unless the context otherwise requires, the allotment of Rights Equity Shares
pursuant to the Issue.
	The accounts opened with the Bankers to this Issue, into which the Application
	Money lying credit to the Escrow Account and amounts blocked by
Allotment Accounts	Application Supported by Blocked Amount in the ASBA Account, with respect
	to successful Applicants will be transferred on the Transfer Date in accordance
	with Section 40(3) of the Companies Act.
	Bank(s) which are clearing members and registered with SEBI as bankers to an
Allotment Account Bank	issue and with whom the Allotment Accounts will be opened, in this case being,
	HDFC BankLimited .
Allotment Advice	Note, advice or intimation of Allotment sent to each successful Applicant who
has been or is to be Allotted the Rights Equity Shares pursuant to the issue.
Allotment Date	Date on which the Allotment is made pursuant to this Issue.
Allottee(s)	Persons to whom the Rights Equity Shares are Allotted pursuant to the Issue
Applicant(s) / Investor(s)	Eligible Equity Shareholder(s) and/or Renouncees who are entitled to make an
	application for the Equity Shares in terms of this Letter of Offer.
	Application made by the Applicant through (i) submission of the
	Application Form or plain paper Application to the Designated Branch of the
	Application made through submission of the Application Form or plain paper
Application	Application to the Designated Branch of the SCSBs or online/ electronic
	application through the website of the SCSBs (if made available by such SCSBs)
	under the ASBA process to subscribe to the Rights Equity Shares at the Issue
	Price.
Application Form	Unless the context otherwise requires, an application form (including online
application through the website of the SCSBs (if made available by such SCSBs)
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