Stylers International : Issuance of Right Shares

ADVICE FOR INVESTORS

INVESTMENT IN EQUITY SECURITIES AND EQUITY RELATED SECURITIES INVOLVES A CERTAIN DEGREE OF RISKS. THE INVESTORS ARE REQUIRED TO READ THE RIGHTS SHARE OFFER DOCUMENT (HEREIN REFERRED TO AS 'OFFER DOCUMENT')AND RISK FACTORS CAREFULLY, ASSESS THEIR OWN FINANCIAL CONDITIONS AND RISK-TAKING ABILITY BEFORE MAKING THEIR INVESTMENT DECISIONS IN THIS OFFERING.

RIGHT ENTITLEMENT LETTER IS TRADABLE ON PSX, RISKS AND REWARDS ARISING OUT OF IT SHALL BE SOLE LIABILITY OFTHE

INVESTORS.

THIS DOCUMENT IS ISSUED FOR THE PURPOSE OF PROVIDING INFORMATION TO SHAREHOLDERS OF THE COMPANY AND TO THE PUBLIC IN GENERAL IN RELATION TO THE RIGHTS ISSUE OF PKR 2,329,005,356/- CONSISTING OF (53,540,353) NEW ORDINARY SHARES OF PKR 43.50/- EACH BY STYLERS INTERNATIONAL LIMITED. A COPY OF THIS DOCUMENT HAS BEEN REGISTERED WITH THE SECURITIES EXCHANGE. THIS OFFER DOCUMENT IS VALID TILL. OCTOBER 5, 2024 (60 days from the last day of payment of subscription amount)

Stylers International Limited

Right Share - Offer Document

Registered Office: 20-KM Ferozepur Road Glaxo Town Lahore - 74000, Pakistan, Contact Details: UA Phone +

92 042 35274471-3, Email: [e-mail], Website: www.stylersintl.com, Contact Person: Tariq Majeed - Company Secretary, Date of Incorporation: 27th November 1991, Company Registration No.: 0025799, Share Registrar: F.D. Registrar Services (SMC-Pvt.)Limited, Address: Suit 1705 - A. 17th Floor, Saima Trade Tower, I.I. Chundrigar Road, Karachi - 74400, Tel: [phone]. Fax: [phone] Email: [e-mail], website: www.fdregistrar.com

Circular under Section 83(3) of the Companies Act, 2017 and Schedule 1 under the Companies (Further Issue of Shares) Regulations, 2020 for issue of 53,540,353 (Fifty Three Million Five Hundred and Forty Thousand Three Hundred and Fifty Three) ordinary shares by way of Rights (i.e. 12.30% of the existing paid-up capital of Stylers International Limited) at an offer price of PKR 43.50/- per share (i.e. including a premium of PKR 33.50/- per share) for an aggregate issue size of PKR 2,329,005,356/- (Pak Rupees Two Billion Three Hundred and Twenty-Nine Million Five Thousand Three Hundred and Fifty-Six) at a ratio of 12.30 rights shares for every 100 shares held.

Date of placing offer document on PSX for Public	Not opted for Public comments
Comments
Date of Final Offer Letter	June 13, 2024
Date of Book Closure	From June 24, 2024 to July 01, 2024
Dates for Payment of Subscription Amounts	From July 8, 2024 to August 6, 2024
Trading Dates for Letter of Rights	From July 8, 2024 to July 30, 2024
Website address to download Offer Document	www.stylersintl.com

OFFER DOCUMENT | STYLERS INTERNATIONAL

Details of Relevant Contact Person

Description	Name of	Designation	Contact	Office Address	Email ID
	person		Number
Authorized Officer	Mr. Tariq	Company	+92 333	20-KM Ferozepur	tariq.majeed@styler
of the Issuer	Majeed	Secretary	4225449	Road Glaxo Town	sintl.com
				Lahore - 74000

Underwriters:

Underwriter	Name of	Designation	Contact	Office Address	Email ID
	person		Number
Meezan Bank	Mr. Ovais	Assistant Vice	+92 021	2nd Floor, C-25,	[e-mail]
Limited	Siddiqi	President -	38103500	Estate Avenue, SITE,
		Financial	Ext: 3008	Karachi
		Advisory &
		Structured
		finance
Topline	Mr. Omar	Head of	+92 21	8th Floor, Horizon	[e-mail]
Securities	Salah	Corporate	35303330	Tower, Plot # 2/6
Limited		Finance and		Block-3, Clifton,
		Advisory		Karachi

Bankers to the Issue:

Bankers	Name of	Designation	Contact	Office Address	Email ID
	person		Number
Meezan	Shah	Vice	0333-	Utility Building	Ammar.farooqi@meezanbank.
Bank	Muhammad	President/Deputy	2315178	3rd Floor	com
Limited	Ammar	Manager Capital		Meezan House C-
	Farooqi	Market		25 Estate Avenue
				Karachi

Page 2 of 26

OFFER DOCUMENT | STYLERS INTERNATIONAL

ISSUER UNDERTAKING:

UNDERTAKING BY THE CHIEF EXECUTIVE AND CHIEF FINANCIAL OFFICER

Date: ___________

"WE, THE UNDERSIGNED OF STYLERS INTERNATIONAL LIMITED CERTIFY THAT;

1. THE OFFER DOCUMENT CONTAINS ALL INFORMATION WITH REGARD TO THE ISSUER AND THE ISSUE, WHICH IS MATERIAL IN THE CONTEXT OF THE ISSUE AND NOTHING HAS BEEN CONCEALED IN THIS RESPECT;

1. THE INFORMATION CONTAINED IN THE OFFER DOCUMENT IS TRUE AND CORRECT TO THE BEST OF OUR KNOWLEDGE AND BELIEF;

1. THE OPINIONS AND INTENTIONS EXPRESSED THEREIN ARE HONESTLY HELD;

IV. THERE ARE NO OTHER FACTS, THE OMISSION OF WHICH MAKES THE OFFER DOCUMENT AS A WHOLE OR ANY PART THEREOF MISLEADING; AND

1. ALL REQUIREMENTS OF THE COMPANIES ACT, 2017, THE COMPANIES (FURTHER ISSUE OF SHARES) REGULATIONS, 2020, THE CENTRAL DEPOSITORY COMPANY AND THAT OF PSX PERTAINING TO THE RIGHT ISSUE HAVE BEEN FULFILLED."

FOR AND ON BEHALF OF STYLERS INTERNATIONAL LIMITED

______________________	______________________
MR. UMER KIBRIA MAJAL	MR. MUSTANSER AHMED
CHIEF FINANCIAL OFFICER	CHIEF EXECUTIVE OFFICER

Page 3 of 26

OFFER DOCUMENT | STYLERS INTERNATIONAL

UNDERTAKING BY BOARD OF DIRECTORS:

Undertaking by the Board of Directors (Board) [or an officer of the Company authorized by them in this behalf]

WE, THE BOARD ___________________HEREBY CONFIRM THAT:

1. ALL MATERIAL INFORMATION AS REQUIRED UNDER THE COMPANIES ACT, 2017, THE SECURITIES ACT, 2015, COMPANIES (FURTHER ISSUE OF SHARES) REGULATIONS, 2020, THE LISTING OF COMPANIES AND SECURITIES REGULATIONS OF THE PAKISTAN STOCK EXCHANGE LIMITED HAS BEEN DISCLOSED IN THIS OFFER DOCUMENT AND THAT WHATEVER IS STATED IN OFFER DOCUMENT AND IN THE SUPPORTING DOCUMENTS IS TRUE AND CORRECT TO THE BEST OF OUR KNOWLEDGE AND BELIEF AND THAT NOTHING HAS BEEN CONCEALED.

1. WE UNDERTAKE THAT ALL MATERIAL INFORMATION, INCLUDING RISKS THAT WOULD ENABLE THE INVESTOR TO MAKE AN INFORMED DECISION, HAS BEEN DISCLOSED IN THE OFFER DOCUMENT.

1. RIGHT ISSUE IS THE DISCRETION OF BOARD OF THE ISSUER AND IT NEITHER REQUIRE APPROVAL OF THE COMMISSION NOR THE SECURITIES EXCHANGE.

IV. THE DRAFT OFFER DOCUMENT WAS PLACED ON THE WEBSITE OF THE SECURITIES EXCHANGE AND THE ISSUER ON ________ (I.E. WITHIN 45 DAYS OF THE DATE OF ANNOUNCEMENT BY THE BOARD.

1. COMMENTS FROM SECURITIES EXCHANGE AND THE SECP WERE RECEIVED ON _______

VI.	THE BOARD HAS ENSURED THAT DRAFT OFFER DOCUMENT IS UPDATED IN LIGHT OF THE PUBLIC
	COMMENTS (IF SOUGHT), SECURITIES EXCHANGE AND SECP COMMENTS.
VII.	THE BOARD HAS DISCLOSED ON PSX'S AND COMPANY'S WEBSITE, ALL THE COMMENTS RECEIVED
	ALONG WITH THE EXPLANATIONS AS TO HOW THEY ARE ADDRESSED.
VIII.	THE FINAL OFFER DOCUMENT WAS SUBMITTED TO THE COMMISSION AND PLACED ON SECURITIES
	EXCHANGE WEBSITE ON ____________ ALONG WITH THE BOOK CLOSURE DATES AND RELEVANT
	RIGHT ISSUANCE TIMELINES. (I.E. WITHIN 20 WORKING DAYS FROM THE DATE OF RECEIPT OF
	COMMENTS OF PSX and SECP)
IX.	THE STATUATORY AUDITOR M/s. _____________ OF THE ISSUER SHALL SUBMIT HALF YEARLY
	REPORT TO THE ISSUER REGARDING UTILIZATION OF PROCEEDS IN THE MANNER REFERRED TO IN
	THE FINAL OFFER DOCUMENT. THE ISSUER WILL INCLUDE THE REPORT OF THE STATUTORY
	AUDITOR, ALONG WITH ITS COMMENTS THEREON, IF ANY, IN ITS HALF YEARLY AND ANNUAL
	FINANCIAL STATEMENTS.

Page 4 of 26

OFFER DOCUMENT | STYLERS INTERNATIONAL

1. DISCLAIMER:

In line with the Companies Act, 2017 and Companies (Further Issue of Shares) Regulations, 2020, this document does not require approval of the Securities Exchange and the Securities and Exchange Commission of Pakistan (SECP).

The Securities Exchange and the SECP disclaim:

1. Any liability whatsoever for any loss however arising from or in reliance upon this document to anyone, arising from any reason, including, but not limited to, inaccuracies, incompleteness and/or mistakes, for decisions and/or actions taken, based on this document.
2. Any responsibility for the financial soundness of the Company and any of its schemes/projects stated herein or for the correctness of any of the statements made or opinions expressed with regards to them by the Company in this Offer document.
3. Any responsibility with respect to the quality of the issue.

It is clarified that information in this Offer document should not be construed as advice on any particular matter by the SECP and the Securities Exchange and must not be treated as a substitute for specific advice.

Page 5 of 26

OFFER DOCUMENT | STYLERS INTERNATIONAL

GLOSSARY OF TERMS & DEFINITIONS

BoD	Board of Directors
Company or Issuer	Stylers International Limited
Companies Act	Companies Act, 2017
CDC	Central Depository Company of Pakistan Limited
CDS	Central Depository System
PKR or Rs	Pakistani Rupees
PSX or Securities	Pakistan Stock Exchange Limited
Exchange
SECP or Commission	Securities & Exchange Commission of Pakistan

Page 6 of 26

OFFER DOCUMENT | STYLERS INTERNATIONAL

DEFINITIONS

	Any bank with whom an account is opened and maintained by the Issuer for
	keeping the issue amount.
Banker to the Issue
	Meezan Bank Limited has been appointed as Bankers to the Issue, in this
	Right Issue
	The Book Closure shall commence from June 24, 2024 to July 1, 2024 (both
Book Closure Dates	days inclusive).
Issue	Issue of 53,540,353 right shares representing 12.30% of the total paid-up capital
	of the Company.
	The price at which right shares of the Company are offered to the existing
Issue Price	shareholders.
Market Price	The latest available closing price of the share.
Net Worth	Total assets minus total liabilities.
	Ordinary Shares of Stylers International Limited having face value of PKR10/-
Ordinary Shares	each.
	The Companies (Further Issue of Shares) Regulations, 2020
	https://www.secp.gov.pk/document/the-companies-further-issue-of-
Regulations	capital-regulations-2020-amended-till-september-16-
	2022/?wpdmdl=45863&refresh=646da0f53433c1684906229
Right Issue	Shares offered by a company to its members strictly in proportion to the
	shares already held in respective kinds and classes.
	A person who has contributed initial capital in the issuing company or has the
	right to appoint majority of the directors on the board of the issuing company
	directly or indirectly;
Sponsor
	A person who replaces the person referred to above; and
	A person or group of persons who has control of the issuing company whether
	directly or indirectly.

Page 7 of 26

OFFER DOCUMENT | STYLERS INTERNATIONAL
Contents
1	SALIENT FEATURES OF THE RIGHT ISSUE	9
1.1.	Brief Terms of the Rights Issue:	9
1.2.	Principal Purpose of the Issue and funding arrangements:	10
1.3.	Financial Effects Arising from Right Issue:	11
1.4.	Total expenses to the issue:	11
1.5.	Details of Underwriters:	12
1.6.	Commitments from substantial shareholders/directors:	12
1.7.	Fractional Rights Shares:	12
1.8.	Important Dates:	13
2.	SUBSCRIPTION AMOUNT PAYMENT PROCEDURE:	13
3.	PROFILE OF BOARD OF DIRECTORS OF THE COMPANY AND SPONSORS	14
3.1.	Profile of the Board of Directors of the Company	14
3.2	Profile of Sponsors of the Company	19
4.	FINANCIAL DETAILS OF THE ISSUER:	20
4.1.	Financial highlights of Issuer for last three years	20
4.2.	Financial highlights for the preceding year of consolidated financial:	21
4.3.	Detail of issue of capital in previous five years:	21
4.4.	Average market price of the share of the Issuer during the last six months:	21
4.5.	Share Capital and Related Matters	21
5.	RISK FACTORS	22
5.1 Risk Associated with the rights issue	22
5.2 Risk Associated with the issuer	23
5.3 External Risk Factors	24
6.	LEGAL PROCEEDINGS:	25
6.1. Outstanding Legal Proceedings of the Company	25
6.2. Action taken by the Securities Exchange against the issuer or associated listed companies of the
	Issuer during the last three years due to noncompliance of the its Regulations	26

6.3. Any outstanding legal proceeding other than the normal course of business involving the Issuer, its sponsors, substantial shareholders, directors and associated companies, over which the issuer

has control, that could have material impact on the issue	26
7. SIGNATORIES TO THE OFFER DOCUMENT	26

Page 8 of 26

OFFER DOCUMENT | STYLERS INTERNATIONAL

1 SALIENT FEATURES OF THE RIGHT ISSUE

1.1. Brief Terms of the Rights Issue:

a)

b)

c)

d)

e)

f)

g)

h)

i)

Description of issue

Size of the proposed issue

Face value of the share

Basis of determination of price of the Right Issue

Proportion of new issue to existing issued shares with condition, if any

Date of meeting of the BoD wherein the Right Issue was approved

Names of directors attending the BoD meeting

Brief purpose of utilization of Right Issue proceeds

Purpose of the Right Issue - Details of the main objects for raising funds through present Right Issue

Issuance of new ordinary shares by way of rights to existing shareholders of the Company, at PKR 43.50/- (Pak Rupees Forty-Three point Five Zero only) per share, as per their proportional entitlement.

The Company shall issue 53,540,353 ((Fifty-Three Million Five Hundred and Forty Thousand Three Hundred and Fifty-Three) ordinary shares, at a price of PKR 43.50/- (Pak Rupees Forty-Three point Five Zero only) per share, aggregating to PKR 2,329,005,356/- (Pak Rupees Two Billion Three Hundred and Twenty-Nine Million Five Thousand Three Hundred and Fifty-Six).

PKR 10/- each

The Right Issue is being carried out at a premium. Considering the current market price of the Company, the premium charged over the par value is justified and is also in line with the prevailing market practice. In fact, the Right Issue price constitutes a discount of approximately 13% to the prevailing market price (as of April 30, 2024 being the date of announcement of the Right Issue).

12.30 right shares for every 100 ordinary shares held by existing shareholders.

30 April 2024

1. Mr. Javed Arshad Bhatti - Chairman
2. Mr. Mian Muhammad Ahsan - Non- Executive Director
3. Mr. Muhammad Umer - Non- Executive Director
4. Mr. Mustanser Ahmed - Chief Executive Officer
5. Mr. Jehanzeb Khan - Independent Director

The proceeds from the Right Issue will be primarily utilized for repayment of loan obtained for the expansion project and to incur capital expenditure for the successful completion of the project.

The purpose of the Right Issue is to secure funds for an expansion initiative, currently the project is being partially financed by an associated

Page 9 of 26

OFFER DOCUMENT | STYLERS INTERNATIONAL

j)

k)

Minimum level of subscription (MLS) "Application Supported by Blocked amount" (ASBA) facility, if any, will be provided for subscription of right shares.

Company. These funds will be allocated towards repayment of financing obtained and for further expenditure required for the successful completion of the expansion project.

Not Applicable

Not Applicable

1.2. Principal Purpose of the Issue and funding arrangements:

The purpose of the Right Issue is to secure funds for an expansion initiative integral to Company's long term business Sustainability and Growth strategy. The project is designed to meet the escalating demand of its customers more efficiently and aims to attain the esteemed Leeds certification. With this expansion Company will effectively execute its Growth strategy, thereby enhancing its profitability and giving greater returns to the shareholders. These funds will be allocated towards repayment of financing obtained and for further expenditure required for the successful completion of the expansion project including civil construction, MEP, Plant & Machinery etc.

Brief components of estimated project cost are described below:

Description	PKR Mn
Building (Including Hostel)	3,805
Plant & Machinery (Including Boiler, Genset, Air Compressor, Effluent Treatment Plant	2,807
(ETP), Automation etc.)
Mechanical, Electrical and Plumbing	613
Pre-operating Expenses & Fixtures	248
Fire Equipment, Hydrants etc.	197
Solar System	156
Govt. Licenses (Gas, LESCO etc.)	80
LEED Certification Gold (Includes Work to qualify for Certification)	15
IT Equipment Infrastructure	13
Contingencies and Others	84
Total	8,019

The project envisage a LEED Certified state-of-the-art facility with Building Capacity of 6 million garments annual capacity and installed Plant & Machinery Capacity of 4 million garments annually. Spanning across 35 acres of land, a covered area of 500,000 sqft. with Miyawaki forest of 36,500 sqft. Project is located at 3km off Raiwind Manga Road Distt. Lahore.

Plant & Machinery includes Boilers, Genset, Air Compressor, Effluent Treatment Plant (ETP) and Automation etc. By deploying cutting edge technology / latest machinery & equipment like Rain forest Laundry Machines, Ozone Technology, Green Series Dryers (which will significantly reduce usage of resources water, steam & chemicals while shorting the process time).

The total cost of the project is PKR 8.0 billion and is being financed by internal generation of funds and a loan from an associated company to the tune of PKR 2.3 billion. The major portion of the Right issue proceed will be utilized for re-payment of loan and partially for further financing of the project. No

Page 10 of 26