Niwas Spinning Mills Ltd. Company History and Annual Growth Details

The Company was incorporated on 19th April, 1984 as a private limited company and was converted into a public limited company on 18th June, 1986. It was promoted by Jaju family of Solapur (Maharashtra). The main object of the Company is manufacturing and processing of all types of yarn both cotton and synthetic, cloth, fabric, textiles, etc.

The Company had set up a modern spinning mill at Solapur in Maharashtra with the latest open-end spinning technology. Commercial production of yarn from cotton waste was started in
October 1985.

The Company undertook to expand its yarn manufacturing capacity by adding one clute fed blowroom line, two modern open end spinnign units and two-for-one twisting machine. These spinning units were to be utilised for the manufacture of synthetic yarn of 15 counts, single and double. The installed capacity of this expansion project would be 2,000 kgs of synthetic yarn per day.

1986 - All shares taken up by promoters, directors, etc.

1987 - 9,90,000 No. of equity shares issued at par, out of which
1,20,000 shares received and allotted to promoters, etc. Out of
the remaining 8,70,000 shares, the following shares reserved for
preferential allotment.

- (i) 3,60,000 to NRIs on repatriation basis (only 3,27,200 taken
up).

- (ii) 49,500 to employees, etc., (none were taken up).

- (iii) 17,400 to business associates (only 1,500 taken up). The
balance 4,23,100 shares along with the unsubscribed portion of
1,18,200 out of the preferential quota were offered to the public
in January (all were taken up).

1988 - The Company undertook a terry towel project.

1989 - The Company offered during July/August 1,00,000-14% secured
redeemable partly convertible debentures of Rs.2.50 each on
rights basis to the existing shareholders in the prop. of 10
Debentures: 100 Equity shares (all were taken up). Rs.50 out of
each fully paid-up Debenture would be converted into 5 No. of
equity shares of Rs.10 each at par on the expiry of 6 months from
the date of allotment. The non-convertible portion of Rs.200 per
Debenture would be redeemed in 3 equal instalments at the end of
6th, 7th and 8th year from the date of allotment.

1990 - 5,00,000 shares issued at par in part conversion of debentures.

1991 - The Company undertook a project to increase manufacturing
capacity by setting up 6 open-end spinning units to manufacture
cotton synthetic yarn of higher counts mainly catering to export
markets.

- The spinning machines were imported from Elitex Czechoslovakia.
The cost of the project was being met through issue of
convertible debentures aggregating Rs.7.50 crores,
non-convertible debentures aggregating Rs.2.75 crores and State
subsidy of Rs.0.25 crores.

1992 - The Company offered 12,50,000-14% secured fully convertible
debentures of 60 each for cash of which 6,95,833 debentures were
offered on rights basis to the existing equity shareholders
in the ratio of 4 debentures for every 10 equity shares held.
Out of the balance 5,54,167 debentures, 62,500 debentures were
offered for public subscription in February. Including the
retention of oversubscription, the following debentures were
allotted under this issue:

- (i) 8,00,203 debentures as rights.

- (ii) 40,000 debentures to employees.

- (iii) 5,97,292 debentures to the public.

- As per the terms of the issue, part-A of Rs.20 of each debenture
would be converted into one equity share of Rs.10 each at a
premium of Rs.10 per share at the end of 6 months from the date
of allotment of debentures while part-B of Rs.40 of each
debenture would be converted into two equity shares of Rs.10 each
at a premium of Rs.10 per share at the end of 12 months from the
date of allotment of debentures.

- The Company decided to privately place 2,75,000-14% secured
redeemable non-convertible debentures of Rs.10 each with Mutual
funds. Canbank Mutual Fund agreed to take up 2,25,000
debentures. These debentures would be redeemed in five equal
annual instalments beginning at the end of five year from the
date of allotment at a premium of 5% to be paid along with the
last instalment.

- The Company proposed to issue equity shares/convertible
debentures/non-convertible debentures with or with out detachable
warrants for a aggregate amount of Rs.120. crores.

- 14,37,407 No. of equity shares allotted at a premium of Rs.10 per
share on conversion of part A of debentures.

1994 - The Company undertook to set up a spinning unit of spindles with
latest technology with a total outlay of Rs.60 crores.

- 24,84,814 No. of equity shares allotted on conversion of part B
of debentures at a premium of Rs.10 per share.

1995
- During May the company issued through prospectus 72,65,500 zero interest FCDs of Rs.80 each as follows: 18,15,625 debentures on firm allotment to promoters, directors, their friends. The following debentures were issued on preferential allotment basis:
- (i) 10,85,000 debentures to fin. Institution;
- (ii) 10,85,000 debentures to Mutual Funds;
- (iii) 13,02,000 debentures to NRIs/OCBs and
- (iv) 10,000 debentures to employees. Of the these only 19,66,225 debentures were taken up.
- Balance 19,64,875 debentures along with unsubscribed portion of 34,80,650 debentures from pref. quota was issued to the public.
- Each FCD of Rs. 80 would be converted into two equity shares of Rs.10 each at a premium of Rs.30 per share, six months from the date of allotment of debentures.

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