II. Positioning Prisma.

ai for a successful IPO

Why Prisma will be a “Must Buy” stock in an IPO

25
 POSITIONING PRISMA.AI FOR A SUCCESSFUL IPO

Prisma.ai will be a unique investment opportunity for IPO investors

INDIA LISTED UNIVERSE (EX-FINANCIALS)

4,732

MARKET CAP > USD 500 MN

647

REVENUE CAGR > 30%

FY22-24E AND FY24E-26E
20

EBITDA CAGR > 30%

FY22-24E AND FY24E-26E
12

ROCE
FY24 > 20%
7

Prisma.ai will be only the 8th company with a unique mix of business scale, strong revenue and profitability growth
coupled with superior return metrics
26
 POSITIONING PRISMA.AI FOR A SUCCESSFUL IPO

Enterprise Tech / B2B SaaS : Emerging as the best way to play the tech space in India

Enterprise tech/ B2B SaaS Consumer Tech

Addressable market Global market India focused New Age Enterprise Tech/
Both Old Economy (Digital SaaS could be a better way
Growth Driver Migrants) + New Economy Changing consumer behaviour
(Digital Native) companies to play the overall growth
Competition depending on in the digital ecosystem
Market structure and competition More niche focus
segment
given that they have better
Regulatory outlook Minimal intervention Benign
profitability
Profitability Yes No
Discounting Nil High

Enterprise Tech IPOs have outperformed Consumer Tech IPOs in the past 2-3 years
Enterprise Tech (since IPO) Consumer Tech (since IPO)

Median Gain/ (Loss) – 76% Profitable Loss making Median Gain/ (Loss) – 1%
347%
193% 156% 142%
27% 15%
81% 71% 68%
8% 2%
-14%
Happiest eMudhra Latent View Mapmy Rategain Kfintech Tracxn Yatra -59% -81%
Minds India Zomato Mama Earth PB Fintech Nykaa Cartrade PayTm
Source: IIFL research, corporate presentation, Bloomberg
27
 POSITIONING PRISMA.AI FOR A SUCCESSFUL IPO

Tech Product Companies: Gaining Momentum & Creating Significant Value

Demonstrating strong performance and outpaced growth of traditional IT service players
Returns Profile
300 Rate MapMy e-Mudhra Nifty IT
Gain India 3.0 x
250
Tech Product Cos Vs Nifty IT – PE Multiple Comparison Tech Product
200 e-Mudhra MapMyIndia Rate Gain Nifty IT companies have
1.7 x scaled up rapidly
71.7x 70.7x 58.3x 30.0x
150 since IPO and
1.3 x outperformed
100
traditional IT
1.0 x service players
50

INR Crores

FY21 FY24 FY21 FY24 FY21 FY24

Revenue Growth Revenue Growth
Scaling Revenue
Revenue Growth
Revenue 132
106%
377 152
154%
387 251
283%
961 resulting in
Margin Profile Margin Profile Margin Profile operating
Operating Profit 40 111 51 170 7 188 leverage and
30% → 30% 33% → 44% 2% → 19%
PAT Margin PAT Margin PAT Margin improvement in
PAT 25 75 60 141 -25 140
19% → 22% 39% → 36% -10% → 15% margin leading to
Market Cap
1,999 6,268 5,500 10,078 4,537 8,446 rerating of stocks
(IPO Vs Current) 214% 83% 86%
Source:: Bloomberg and Public Domain 28
 POSITIONING PRISMA.AI FOR A SUCCESSFUL IPO

Only listed company in India with AI as core

Single platform with multi-product capabilities Current Listed Enterprise Tech Universe

Client Camera Decision Making

Core Computer Vision
Platform Capabilities
Workflow/
Mobile Platform
Solution Led

AI Video Facial IRIS Sentiment

Analytics Recognition Recognition Analysis

Text Demographic NLP Body Posture

Translation Analysis Processing Recognition
Client Servers
Data /
Offering Best in Class Solutions Platform Led

Gryphos GryFAS
Core Computer Vision AI Platform Financial Authentication System
Complete Visual Recognition
Analyzing videos, images, objects, face
Uses Face Recognition
before authorizing transactions
and sentiment

Gryphos Veri5
Services Led
Ai Solution for Baggage Scanning Digital ID Authentication Platform
Identifying Unique Objects Uses Face Recognition
Scanning & Processing at Airports / For proper authentication and
Customs enhancing security measures

Machine Learning 29
 POSITIONING PRISMA.AI FOR A SUCCESSFUL IPO

Strong tailwinds in Global computer vision market having strong use cases –
APAC is the 3rd largest market
AI in Global computer vision market Software captures ~58% of overall computer APAC is 3rd largest market in Computer Vision
expected to grow at a CAGR of ~22% vision market followed by North America & Europe
$Bn ~80% of new opportunities to be driven by software market
45.7 7% 5% North America
22%
CAGR 38% Europe
21%
42% Software Hardware 2023 Asia Pacific

17.2 58% Latin America

ME & Africa
29%

2023 2028

Rapid growth in various use cases of AI

Addressable Market - Excluding China Factors driving AI in Computer Vision Market
market
$Bn
Facial Recognition Market
367 Million
2023 6.3
CAGR 13.4 2028 Global CCTV Cameras
16.3%
Excludes China Market
Global Optical Character Recognition Market

CAGR Increasing Improve accuracy Numerous emerging

2023 12.6 32.9 2030 demand for
14.8% $ 8.8 Billion automation &
of decision-making applications in agri,
processes logistics, mfg etc.,
AI in Image Recognition Market Total Addressable Market efficiency

2023 2.6
CAGR 4.4 2029 $20 per camera per month +
11.8% 10% utilizing AI
Source: Precedence Research, Market research, Nasscom-BCG report, Markets & Markets
30
 POSITIONING PRISMA.AI FOR A SUCCESSFUL IPO

Prisma - Strong Moats built on back of superior technology with a well diversified
business
Strong right to ‘win’ against competition Well diversified business across
Leading to..
1
Propreitory Pre Trained Platform CLIENTS
High Scalability
<25% 100+ 5 continents
Both On Premise and
Revenue from Large clients International
Pre-Trained AI& ML Decision Cloud Deployment
Top 10 Clients across the world Presence
Models Algorithms Science
Defensibility and Prisma has established well entrenched relationships across
Stickiness marquee clients ensuring secular multi-decadal organic growth
Strong Proven, Reliable,
Retention Secure 2
SEGMENTS
100+ SaaS Contracts ~99% 250+
Strong Entry Highways
Reliable Pre trained Barriers 24% Built multi-product
Accuracy 32% Facilities & security
revenues API models presence across various
5% FY22 Logistics sectors viz – Highways/
110%+ NIL <0.3% Airports roads, Facilities &
15%
Net Revenue Security Monthly 24% Others security, Logistics,
Retention Breachers churn Hospitals etc.,
High Visibility of 3
Revenues SOLUTIONS
Ease of Integration
Ease of integration to existing infrastructure Object Recognition
10%
6% Multi- use case
41%
Facial Recognition platform enabling the
Strong recurring 16%
FY22 Character Recognition ability to cross-sell
Customiz Pre- Revenues
Expandable and up-sell as
able Integrated Sentiment Recognition
27% required
One stop shop for clients Others

31
 POSITIONING PRISMA.AI FOR A SUCCESSFUL IPO

Prisma compares well against Computer Vision SaaS, best in class SaaS and India SaaS
companies
Computer Vision AI Cos Best in class SaaS companies India SaaS How
Prisma
Company Compares

Market 0.9% 1% 11%^^ 1.6% 2.7% 1.6% 5.2% 0.6% 0.2%

Penetration #

Revenue 34.0% 46.5% -10.1% 18.3% 51.3% 7.8% 22.2% 18.9% 53.4%
growth%#

Gross Margin%
~74% ~72% ~65-70% 78.6% 65.3% 82.8% 78.3% 80.8% 75.3%
(FY24/ CY23)

EBITDA Margin%
(FY24/ CY23) ~20% -ve -ve 28.4% 17.0% 40.2% 31.8% 9.0% 19.9%

SaaS /
Subscription 99% 98% NA >90% 75% 99% 95% 97% 59%
Revenues (%)

Net Retention
Ratio 111% 120% 131% 125% 110%
NA >115% 104% 108%
(FY24/CY23)

High
LTV/CAC 14.9x
8.0x 10.0x
NA0.0x NA 0.0x 5.5x 5.0x
4.0x

Source: Investor presentation, IIFL Research, Annual reports

*FY22-24/ CY21-23 # Penetration – Revenues (FY24/CY23)/ Addressable Market; 32
^^11% Market Share in China as per initiating coverage (since there are restrictions globally may not be able to address the global market)
 POSITIONING PRISMA.AI FOR A SUCCESSFUL IPO

Prisma caters to a large & diverse pool of customers aided by system integrators with
strong Revenue visibility
Large & diversified customer base Revenues from across geography with India having the
highest share
High Logo Retention while serving 100+ Large institution
Among few players in India having SI partners India
Looking to expand
5%3% Asia (ex-India)
System Integrators 5% offices globally – to
Diverse set of marquee clients Partnerships 6% Middle East open new markets to
8% 46% Europe Prisma
FY22
Africa
27% South America
Marquee USA
Customers
across the Other product cos with SI
globe partnership which have scaled 2/3rds of the revenue growth from existing clients /
referrals

>2/3rd revenue growth from High visibility of

existing clients/ referral revenues
58.8

5.5
99% SaaS revenues
Lower competition with the Chinese
Consistent scale up in no of contracts
“big four” sanctioned in USA 4.3
2.4
FY19 FY20 FY21 FY22 FY23 contracts
110
41.9 4.7 <0.3% Monthly churn
80 30
62 -
18 18
-
34 28 28 28
18 - Average
-
18
16
18
16
18
16
18
16
18 FY22 Net Client Referrals New FY23
2-5 contract years
Retention Expansion customer
FY19 FY20 FY21 FY22 FY23 contracts

33
 POSITIONING PRISMA.AI FOR A SUCCESSFUL IPO

Highly Experienced Founders with a Visionary Leadership

Supported by a Strong Management Team
Founders

Dr. Shreeram Iyer Mr. Amitabh Roy Chowdhury

Chairman | Group CEO | Co-Founder Group COO | Co-Founder
• Over 25 years of experience in IT, Visual Recognition and Artificial Intelligence • Over 25 years of experience in IT, Artificial Intelligence & Machine Learning
• Former Senior VP of International Operations with Patni Computers (NASDAQ Listed) • Held multiple senior management roles in operations and business development
• BE in Mechanical Engineering, EP in AI & Business from MIT • Extensive international exposure across continents of US, Europe and South Asia
• PhD in Computer Vision & Business Specifications from EU University • Associated with premier IT organizations like TCS, i-Flex Solutions and Oracle
Management Team

Mr. Andrea Querci Mr. Santosh Chavan Mr. Dylan Tinker

Head- Finance
Executive Director Head – Indian Sales
• 25 years of rich experience in Financial Advisory
• An Italian Entrepreneur with a solid leading TMT teams in various investment banks
background in engineering coupled with • Chairman of Seawoods Group of Companies
extensive experience in computer science • Former practicing lawyer of High Court • Oversaw tech investments for Tudor Investments in
• Involved with Prisma for over 17 years and has Asia
been critical in developing contracts in Europe • Worked at OCP Asia, managing his own hedge fund

34
 POSITIONING PRISMA.AI FOR A SUCCESSFUL IPO

Impressive Historical Financial Performance & Robust Financial Outlook

Impetus with strong growth triggers in both revenue and profitability
Revenue From Operations EBITDA & EBITDA Margins
USD Mn USD Mn CAGR: 44% CAGR: 76%
CAGR: 40% 148
32% 35%

102 26% 48 30%

CAGR: 37% 75 20% 25%

17%
58 15% 20%

42 10% 26 15%

30 10%

15 5%

0
5 6 6 0%

FY21 FY22 FY23 FY24E FY25E FY26E FY21 FY22 FY23 FY24E FY25E FY26E

Profit After Tax & PAT Margins Return Metrics

USD Mn ROE % ROCE %
CAGR: 45% CAGR: 88%
25%
54%
21%
31 20%

16% 40%
12% 15%

10% 27% 29% 25%

5% 16 10%
19% 17% 17%
5%
9
5%

0 3 2 3 0%

FY21 FY22 FY23 FY24E FY25E FY26E FY21 FY22 FY23 FY24E
Source: Provided by the Company 35
III. Indicative Equity Valuation and Key Considerations

36
 INDICATIVE EQUITY VALUATION AND KEY CONSIDERATIONS

Framework for Valuing Prisma.ai – Key Considerations

Key Considerations for Valuation

Prisma will be positioned as the only pure play AI player in computer vision sector in India covering various use cases with marquee customer
profile, strong product suite, very strong delivery track record and one of the best management teams in the Industry
Investors will primarily benchmark Prisma with
➢ Indian SaaS players and tech product companies
➢ Globally listed computer vision product and services companies
➢ Globally listed AI focused best in class SaaS companies and
➢ Globally listed on-premise/ traditional software companies
Assuming an IPO in Q4FY2025 the IPO valuation will be benchmarked basis EV to EBITDA primarily on FY26 performance
Valuation vis-à-vis the above companies will be a function of the following:
➢ Growth – Superior revenue and profitability growth potential over medium and long term
➢ Product/ use case addition & diversification – Ability to further add adjacent use cases

Qualitative Factors

Strong Management team ▪ Passionate Founders with extremely strong Background

▪ Strong Revenue and EBITDA growth

Market leadership position with strong
▪ Best in class customer profile
growth engines in place
▪ Strong tailwinds in the Industry

37
 INDICATIVE EQUITY VALUATION AND KEY CONSIDERATIONS

Peer landscaping Prisma.ai for Valuation Benchmarking

Indian SaaS / Analytics Computer Vision – Products & Services Best in Class SaaS – AI Focused

Indian Product Based Tech On Premise & Traditional Software

Investors will benchmark Prisma.ai with a combination of the above players

Source: Bloomberg,, Investor Presentations, Annual Reports, Credit Rating Reports 38

 VALUATION APPROACH AND POTENTIAL EQUITY VALUATION

Benchmarking Prisma.ai with Selected Listed Peers

Strong Delivered With Promising Revenue & EBITDA Growth
Revenue Growth
116 47 78 838 227 471 79 937 491 614 NA NA NA 74
CY23E/FY24E Revenue (USD Mn) FY22-24/CY21-23 FY24-26/CY23-25
Median 32% 23% Median -14% 19% Median 6% 27%

53% 55%
47% 48%
40%
32% 34% 27% 25% 34%
20% 23% 24% 27% 20% 19% 20%
19% 13% 20%
9% 12% 9%
6%

-10% -15% -6%

-17%
RateGain Map Latent Cognex Ambarella Sensetime Arcsoft Samsara Arlo Clear Indian SaaS On- Prisma.ai
MyIndia View Tech Secure Tech AI Focused Premise
Product Software

EBITDA Growth
23 21 16 153 (25) (802) 22 8 (14) 42 NA NA NA 15
CY23E/FY24E EBITDA (USD Mn)
FY22-24/CY21-23 FY24-26/CY23-25
Median 33% 30% Median -33% 31% Median 1% 65%
135% 218%
69% 76%
65%
56%
41%
30% 33% 32%
29% 31% 28% 28%
15% 15%
8%
1% NA NA 1% NA NA NA

-33%
RateGain Map Latent Cognex Ambarella Sensetime Arcsoft Samsara Arlo Clear Indian SaaS On- Prisma.ai
MyIndia View Tech Secure Tech AI Focused Premise
Global Computer Vision – Product Software
Indian SaaS / Analytics Product Global Computer Vision - Services
Source: Bloomberg 39
Tech Product Companies Include: e-Mudhra, Intellect Design and Newgen ;SaaS AI Focused Companies Include: Palantir, Snowflake, C3.ai and UiPath & On-Premise Software Companies Include: SAP, Oracle and SalesForce
 VALUATION APPROACH AND POTENTIAL EQUITY VALUATION

Benchmarking Prisma.ai with Selected Listed Peers

Margins & Return Profile
EBITDA Margins
CY23E/FY24E EBITDA Margins %
Median 21% Median 4% Median 2%
44%

31%
Lower EBITDA 27%
21% margins on account of 23% 20%
20% 18% R&D spends
14% 18%

2%

-3%
-11% -167%
RateGain Map Latent Cognex Ambarella Sensetime Arcsoft Samsara Arlo Clear Indian Tech SaaS On-Premise Prisma.ai
MyIndia View Tech Secure Product AI Focused Software

Return Profile – ROE / ROCE

CY23E/FY24E
Median 13% / 17% Median 1% / 1% Median 13% / 17%
ROE ROCE
23% 23% 20% 22% 22%
17% 19%
13%17% 12% 17%
11%
8% 8% 11% 4%
11%
5% 0% 6%
NA NA NA

-6%-10%
Rate MapMy Latent Cognex Ambarella Sensetime Arcsoft Samsara Arlo Clear Indian SaaS On- Prisma.ai
Gain India View Tech Secure Tech AI Premise
Product Focused Software
Global Computer Vision –
Indian SaaS / Analytics Product Global Computer Vision - Services
Source: Bloomberg 40
Tech Product Companies Include: e-Mudhra, Intellect Design and Newgen ;SaaS AI Focused Companies Include: Palantir, Snowflake, C3.ai and UiPath & On-Premise Software Companies Include: SAP, Oracle and SalesForce
 VALUATION APPROACH AND POTENTIAL EQUITY VALUATION

Benchmarking Prisma.ai with Selected Listed Peers

Valuation Multiples
EV / Sales Multiples
NTM → FY25
Median 12.4x Median 7.2x Median 3.2x
18.7x
16.4x

12.4x 11.8x
10.8x
6.9x 7.3x 7.0x 6.8x 6.9x
3.0x 3.2x
2.0x

RateGain Map Latent Cognex Ambarella Sensetime Arcsoft Samsara Arlo Clear Indian SaaS On-
MyIndia View Tech Secure Tech AI Focused Premise
Product Software
EV / EBITDA Multiples
NTM → FY25
Median 22.4x
Median 42.7x Median 37.3x

54.0x 51.9x
42.7x 45.6x
32.3x 37.3x
28.6x
22.4x 17.7x 19.9x
NA NA NM

RateGain Map Latent Cognex Ambarella Sensetime Arcsoft Samsara Arlo Clear Indian SaaS On-
MyIndia View Tech Secure Tech AI Focused Premise
Global Computer Vision – Product Software
Indian SaaS / Analytics Global Computer Vision - Services
Product
Source: Bloomberg 41
Tech Product Companies Include: e-Mudhra, Intellect Design and Newgen ;SaaS AI Focused Companies Include: Palantir, Snowflake, C3.ai and UiPath & On-Premise Software Companies Include: SAP, Oracle and SalesForce
 INDICATIVE EQUITY VALUATION AND KEY CONSIDERATIONS

How R&D spends are treated across various companies

Comparison of R&D spend with Global peers Comparison of R&D expense with Indian peers

Total R&D spend as a % to revenue

Total R&D spend as a % to revenue
CY23/ FY24 FY23 We understand Rategain does not capitalize any R&D costs
Total R&D Total R&D
cost 485 268 ~6.5 cost 344 240 3,102 ~500
$ Mn Rs Mn
101%
14% 14% 15%
9%
29%
15%

Sense time Samsara Prisma (FY22) eMudhra MapmyIndia Intellect Design Prisma (FY22)

Portion of R&D spend capitalized FY23

Portion of R&D spend capitalized
Total R&D Total R&D
0 9.7 ~6.5 cost capitalized 160 124 1,378 ~500
cost
Rs Mn
$ Mn
100% 100%

46% 52% 44%

0% 4%

Sensetime Samsara Prisma (FY22) eMudhra MapmyIndia Intellect Design Prisma (FY22)

Source: 1. IIFL research 42

* Prisma date is FY22
 VALUATION APPROACH AND POTENTIAL EQUITY VALUATION

Indicative IPO Valuation for Prisma

IPO Discount
• Assuming a Q4’24/Q1’25 IPO, investors would look to value Prisma on the basis ~ 20% 42.7x
of FY26E EBITDA adjusted for R&D expense 40.0x
Premium
of ~10%
• We have assumed a 15% R&D cost on revenue (basis historical spend) with ~ 28.6x
30.0x-33.0x
50% being expensed (per various examples of other Indian tech product cos)
22.4x
19.9x
• Key consideration for valuing Prisma
➢ We believe Prisma will command a superior multiple to other Computer
vision AI companies and On-premise Software companies on account of
superior growth and other metrics
➢ Will likely trade at a similar to Indian SaaS companies post listing Global Global On- Indian Tech Prisma IPO Prisma India SaaS
delivering 4-6 quarters of operating performance Computer Prem Product Cos Multiple Trading /Analytics
Vision Software Multiple

Indicative Equity Valuation

EBITDA Bridge $ Mn Particulars ($ Mn) Lower Higher

Revenue (A) 148.2 FY26E Adjusted EBITDA 36.6

R&D spend (B= A*15%) 22.2 EV/EBITDA Multiple 30x 33x

To be expensed (C =B*50%) 11.1 Enterprise Value 1,100 1,210

EBITDA (D) 47.7 FY26E Sales 148.2

Adjusted EBITDA (D-C) 36.6 Implied EV/Sales (x) 7.4x 8.2x

We believe Prisma could fetch an enterprise value of $1.1-$1.2 Bn for an IPO

Source: Bloomberg, company, investor presentations, annual reports, credit rating reports 43
 VALUATION APPROACH AND POTENTIAL EQUITY VALUATION

Pre IPO - an effective means to establish a valuation benchmark (1/2)

▪ Prisma may consider a pre-IPO placement round with certain select investors after filing the DRHP with SEBI
▪ Serves to provide a valuation benchmark for the IPO itself with select quality investors
▪ Post recent changes in regulations, we would need to disclose the amount OR no. of shares for the pre-IPO in the DRHP
▪ The pricing of the pre-IPO may depend on the stage the pre IPO is completed

% of Pre IPO Pre-IPO as % of Discount to IPO

Name IPO size (INR Mn) Pre-IPO (INR Mn) Investors
Primary Secondary IPO (%)

Pre-DRHP

5,672 500 100% 9% 52%

5,882 900 100% 15% 82%

64,004 26,519 100% - 29% 46% plus others

15,422 3,900 - 100% 20% 3%

57,009 24,500 - 100% 30% 33%

83,864 1,800 - 100% 2% 34%

Post-DRHP

5,700 800 67% 33% 12% 0%

5,930 930 78% 22% 14% 0% Volrado Ventures

5,634 980 100% - 15% 0% Lucky Investments

44
 VALUATION APPROACH AND POTENTIAL EQUITY VALUATION

Pre IPO - an effective means to establish a valuation benchmark (2/2)

Pre-IPO a s % of Discount to IPO
Name IPO size (INR Mn) Pre-IPO (INR Mn) Primary (%) Secondary (%) Investors
IPO (%)

Post-DRHP

6,310 510 100% - 7% 0%

5,672 600 100% - 11% 0%

8,578 2,380 55% 45% 22% 0% plus others

4,128 390 100% - 9% 5%

5,882 600 100% - 9% 0%

5,964 1,000 100% - 14% 6%

5,808 1,520 100% - 21% 4%

8,100 1,500 100% - 16% 3%

7,459 2,500 100% - 25% 5% plus others

Post-RHP

10,933 3,299 - 100% 23% 0% plus others

14,623 800 - 100% 5% 0%

21,437 1,500 - 100% 7% 0%

10,007 3,450 - 100% 26% 3% plus others

4,000 1,285 - 100% 24% 2%

45
IV. Timeline & Investor Marketing Strategy

46
 TIMELINE & INVESTOR MARKETING STRATEGY

Suggested Structure for Flip in order to list on Indian Stock Exchange

Current Structure Proposed Structure Indirect holding - option

Shareholders Shareholders Other subsidaries

Prisma Singapore Set up new company

Prisma Singapore New Singapore Co.
(Prisma AI Corporation Pte Ltd)
Shares are issued to H Sale of IP/business/ shares of overseas subs in exchange for New
Co by Cap India in Op Co issuing shares to H Co
exchange for New Op Co
Other subsidaries shares Currently holds
100%
Prisma India Prisma India
Purchase shares of New Op Co
(Prisma Global Ltd) from H Co

Key Mechanics

➢ Prisma.ai is currently headquartered and global operations being held through ➢ Prisma Singapore (current entity) to set up a new entity in Singapore (new
Singapore operating company)

➢ Prisma has a subsidiary in India – Prisma Global Ltd ➢ Business, IP and subsidiaries of Prisma Singapore to be sold to the new Op Co
against which new Op Co will issue shares to Prisma Singapore
➢ In order for the company to be listed in India, the numbers of the company will
need to be consolidated in/ under Prisma India as well ➢ Prisma India to purchase shares of New Op co against issuance of it’s shares to
Prisma Singapore

➢ A similar approach was used by Capillary to restructure. There may also be other
ways to restructure which can be explored
Source: IIFL research
47
 TIMELINE & INVESTOR MARKETING STRATEGY

Indicative Timeline & Key Milestones for Prisma IPO

• Industry Report for inclusion in •Issuance of Pre-Deal Research
DRHP •File DRHP with SEBI and Stock Detailed roadshows covering
Exchanges with FY22 to FY24 and • Inclusion of Q3FY25 QIBs
• Auditors deliverables including financials in RHP
Restated Financials for 3 full H1’24 financials
financial years and stub period
Complete the Pre-IPO
placement prior to
filing RHP

DRHP Filing Analyst & SEBI Approval

IPO Kick-off IPO Launch
Nov’24 using Sep‘24 Management Feb’25
Jul’2024 Feb/March 25
financials Roadshows Filing of RHP

• Financials of Q3
• Kick-off the IPO process post FY25 for investor • Conduct Analyst teach-in Jan • Anchor book finalization
re-structuring with a joint meetings 2025 and Cornerstone • Retail roadshows
meeting involving all Management Roadshows in Q4 • Aggregate QIB firm • HNI meetings
stakeholders 2025 interest in size and price • Launch and Closing
for participation in Anchor
• Conduct diligence and DRHP
and Main IPO portion
drafting simultaneously

We recommend a Reg S Deal - IIFL will work with investors to build up anchor demand across geographies
48
 VALUATION APPROACH AND POTENTIAL EQUITY VALUATION

High OFS component in an IPO (as % of Issue) is not a concern

Many deals in the past few years have had OFS component > 50% of the issue size
IPOs with 100% OFS Component Issue Size (Rs. Mn) Dilution %
IPOs with >50% OFS Component
Issue Size (Rs. Mn) Dilution %
Bharati Hexacom 100% 42,750 15% Sona Comstar 95% 55,500 32.7%
Medi Assist 100% 11,716 41%
Rolex Rings 92% 7,310 19.9%
Credo Brands 100% 5,498 31%
KIMS 91% 21,437 32.5%
Inox CVA 100% 14,593 24%
Tata Technologies 100% Dodla Dairy 90% 5,202 20.4%
30,425 15%
ASK Automotive… 100% 8,340 15% Nykaa 88% 53,519 10.1%
Cello World 100% 19,000 14% Go Fashion 88% 10,136 27.2%
Blue Jet Healthcare 100% 8,403 14% India Pesticides 88% 8,000 23.5%
Concord Biotech 100% 15,510 20% Tarson Products 85% 10,235 29.1%
Mankind 100% 43,264 10% Rainbow Hospital 82% 15,808 28.4%
Sula 100% 9,603 32% Aptus Value Housing 82% 27,801 15.9%
Bikaji Foods 100% 8,808 12% Metro Brands 78% 13,675 10.1%
Tracxn Technologies 100% 3,094 39%
Global Health 77% 22,056 24.5%
Dreamfolks Services… 100% 5,621 33%
Devyani International 76% 18,380 17.0%
Prudent 100% 5,386 20%
Campus Activewear 100% 14,001 16%
Fino Payments 75% 12,003 25.0%
Vedant Fashion 100% 31,492 15% Rategain Travel 72% 13,357 29.5%
AGS Transact 100% 6,800 32% Supriya Lifesciences 71% 7,000 31.7%
CMS Infosystems 100% 11,000 34% Nuvoco Vistas 70% 50,000 24.6%
MapmyIndia 100% 10,396 19% Star Health 69% 64,004 12.4%
Anand Rathi 100% 6,600 29% Krsnaa Diagnostics 67% 12,133 40.6%
Tega 100% 6,192 21% Chemplast Sanmar 66% 38,500 45.0%
Sapphire Foods… 100% 20,733 28%
eMudhra Limited 61% 4,128 20.7%
S J S Enterprises… 100% 8,000 48%
Data Patterns 59% 5,882 19.4%
Birla AMC 100% 27,683 14%
Sansera Engineering Windlas Biotech 59% 4,015 40.1%
100% 12,830 34%
Vijaya Diagnostics 100% 18,943 35% Shriram Properties 58% 6,000 30.0%
CarTrade 100% 29,985 40% Medplus Health… 57% 13,983 14.7%
G R Infraprojects… 100% 9,633 12% Ami Organics 55% 6,696 25.6%
Clean Science and… 100% 15,466 16% Tatva Chintan 55% 5,000 20.8%
Nazara Tech 100% 5,829 17% PayTM 55% 1,83,000 13.1%
UTI AMC 100% 21,599 31%

Indian IPO Markets has seen several successful IPOs with larger share of OFS
Source: SEBI Offer Documents 49
 TIMELINE & INVESTOR MARKETING STRATEGY

Target Investors for Prisma.AI IPO

Domestic Funds Foreign Funds *

360 One AMC HDFC Life Nippon MF Abrdn GIC Norges Bank
Axis MF HDFC MF Premji Invest ADIA GSAM Pari Washington

Bajaj Allianz Life HSBC MF SBI Life Amansa Hornbill Pinebridge

Ashmore HSBC / Halbis Steadview
Bandhan MF ICICI Pru Life SBI MF
Baillie Gifford Jupiter AM Think Invest
Birla Life ICICI Pru MF Sundaram MF
Blackrock Kotak Offshore UBS GAM
Birla MF Invesco MF Tata AIA Life
Capital Group Manulife Ward Ferry
Canara Robeco MF Kotak MF + Life Tata MF Carmignac Matthews Wellington
DSP MF Max Life UTI MF Eastspring Morgan Stanley IM Wells Capital
Edelweiss Group Mirae MF + FII Value Quest Fidelity Neuberger Berman White Oak

Franklin MF Motilal Oswal MF Malabar Franklin Templeton Nomura

Above mentioned accounts could provide key investor support for the Prisma IPO
IIFL has deep relationships with all of these accounts and would pitch the story to them to ensure maximum participation
50
 TIMELINE & INVESTOR MARKETING STRATEGY

Key HNIs & Family Offices active in Indian Capital Markets

Key HNI hotspots

Mumbai Bangalore Kolkata

Investor Company Investor Company Investor Company

Narotam Sekhsaria Shibulal Family Bangur Group

Radhakishnan Damani Emami Group

Rajeev Chandra Shekhar
Delhi RARE Enterprises
Delhi
Arun Kumar Mehta Narayan Murthy
Kolkata Investor Company
Jyotiprasad Taparia
Mumbai Pune Sachin Bansal Dabur Family
Star Diamond Group

Bengaluru Akash Bhansali Pune Dharampal Satyapal

Investor Company
Atul Nishar Gaurav Dalmia
Poonawalla Group
Sanjay Dangi
Sehgal Family
IIFL has ongoing Shapoorji Pallonji Family
relationship with Desai Brothers
Munjal Family
these HNI / Dani Family
Family Offices Sage One Ashish Dhawan
Rohit Kothari

51
V. Regulatory Considerations
Key Things to Consider

52
 REGULATORY CONSIDERATIONS

Issue Structuring

IPO Eligibility Requirements^

1 3
Net Tangible Assets of at least Rs.30Mn in each of the preceding 3 full years; (of which not more
Net Worth of at least Rs.10Mn in each of the preceding 3 full years
than 50% are held in Monetary Assets*)

2 4
Average Operating Profit** of at least Rs.150Mn, during the preceding 3 years, with Operating In case of a change of name within the last one year, at least 50% of the revenue for the preceding
Profit in each of the preceding 3 years 1 full year has to be from the activity indicated by its new name

Yes No
All conditions
satisfied?

Option 1 Option 2

Eligible under Reg.6(1) of SEBI ICDR Eligible under Reg.6(2) of SEBI ICDR
(not more than 50% QIB allotment) (at least 75% QIB allotment)

Minimum Dilution in an IPO - As per Regulation 19 of SCRR Rules, 1957, if dilution is < 25%, minimum public shareholding of 25% to be
achieved within 3 years of listing

Post-Issue Market Cap (at IPO price) (Rs.) Minimum Issue Size required1
<= 16,000 Mn 25% of the company
> 16,000 Mn & <= 40,000 Mn % of company equivalent to Rs. 4,000 Mn in value
> 40,000 Mn 10% of the company
53
 REGULATORY CONSIDERATIONS

Promoter Contribution and Lock-in Provisions

Minimum Promoters Contribution Securities Ineligible for Promoters’ Contribution

▪ At least 20% of post-issue capital. To the extent on any shortfall Alternate A Securities acquired during the preceding 3 years, if they are:
Investment Fund (AIF) can contribute
▪ Acquired for consideration other than cash and revaluation of assets or
▪ This requirement is to be satisfied at least 1 day prior to the issue opening date capitalisation of intangible assets is involved in such transaction
▪ Resulting from a bonus issue out of revaluation reserves or unrealised profits
Lock-in and transferability provisions ▪ Resulting from a bonus issue against equity shares which are ineligible for
minimum promoters’ contribution
▪ 18 months lock – in for minimum promoters’ contribution from the date of
allotment in the public issue and 6 months for remaining holding for promoter(s),
excluding shares under offer for sale from the date of allotment in the public B Securities acquired during the preceding 1 year, if they are:
issue. Provided that in case the majority of the issue proceeds (less OFS) is
proposed to be utilized for capital expenditure, then the lock-in period shall be 3 ▪ Acquired at a price lower than price offered to public, unless
years and 1 year respectively ▪ Promoters/AIF pay the difference in price to the issuer
▪ 6months lock-in of pre-issue shareholding of persons other than promoter ▪ Acquired in terms of the scheme under sections 391-394 of the
▪ Lock-in does not apply to shares acquired pursuant to exercised options granted Companies Act1
to employees and SEBI registered venture capital firms which have held the ▪ Does not apply to an IPO by a government company, statutory authority or
shares for at least 1 year corporation or any SPV set up by any of them, in infrastructure sector
▪ 30 day lock-in on the shares allotted to the Anchor Investor from the date of
allotment C Other
▪ Locked-in securities can be pledged only for fund raising related to objects of the ▪ Securities allotted to promoters/AIF during the preceding 1 year at a price less
issue than issue price, against funds brought in by them during that period, in case of an
▪ Locked-in securities can be transferred to another promoter/ promoter group/ issuer formed by conversion of one or more partnership firms, where the partners
new promoter, subject to the continuing lock in period are the promoters of the issuer and there is no change in the management2

Securities under A and C are eligible, if acquired pursuant to a scheme under D Securities pledged with any creditor
section 391-394 of the Companies Act

SEBI Regulations require promoters to contribute 20% of the post IPO capital as a compulsory lock-in for 18 months
1Provided the scheme is as approved by High Court, and by such shares are acquired by promoters in lieu of business and invested capital that had been in existence for a period of more than one year prior to such approval
2Provided that securities allotted to promoters against capital existing in such firms for more than one year on a continuous basis, shall be eligible

54
 REGULATORY CONSIDERATIONS

Financial Statements Requirements - Detailed Disclosures

▪ Auditors Report (consolidated) for 3 years / for the period the Issuer is in ▪ Management Discussion and Analysis on Performance for the last 3 years and stub
existence, and the stub period (not older than six months as on date of Issue period
opening / 135 days as on “Closing”). ▪ Reasons for change in significant items of income and expenditure
▪ Restated Financial accounts (consolidated) for audited period and stub period – ▪ Management discussion on:
balance sheet, P&L, notes to accounts, significant accounting policies, cash flow
▪ Unusual or infrequent events
statement, previous year adjustments, if any:
▪ Significant economic changes that are material
▪ Ind AS accounts on a consolidated basis
▪ Known trends or uncertainties that may adversely impact sales, revenues
▪ Restated financial accounts based on following adjustments: or income
▪ Change in accounting policies. ▪ Future changes in relationship between costs and revenues
▪ Prior period items. ▪ Total turnover of each major industry segment in which the company
▪ Auditor qualifications. operated
▪ Incorrect accounting policies. ▪ Status of publicly announced new products / business segments
▪ Extraordinary Items. ▪ Extend to which is business is seasonal
▪ Dividend Policy, Taxation and Capitalization statements. ▪ Dependence on a single or few suppliers or customers
▪ Loans and advances ▪ Competitive conditions
▪ Related party transactions ▪ Audited Financial Information of Group Companies for the last 3 years
▪ Key financial ratios ▪ Audited Financial Information for the three full years of the Company and its
▪ Basis of issue price material subsidiaries shall be uploaded on Company’s website

▪ Comfort letter from the auditors on all financial information in Offer Documents

55
 REGULATORY CONSIDERATIONS

Board of Directors – Composition

Board of Directors

If Chairman is

Non-Executive Director but promoter

Executive Director or not a regular Non-Executive Director and Non-
or related to promoter or managerial
Non-Executive Chairman Promoter
person

Number of Independent Directors Number of Independent Directors

Not less than 50% of the Board At least 1/3rd of the Board

✓ Board to at least have one Woman Director*

✓ Require atleast six directors on the board^
Code of Conduct: Board shall lay down a code of conduct for all the Board members and senior management; who shall affirm compliance annually

The Company may need to restructure its Board for an IPO along with appropriate committees, depending upon the current board composition. Restructuring needs
to be completed prior to DRHP filing. We recommend 8-10 Board of Directors at the maximum
*Board of the top 1000 listed entities shall have at least 1 independent woman director from Apr 1, 2020 ^Board of the top 2000 listed entities shall have at least 6 directors

56
 REGULATORY CONSIDERATIONS

Board of Directors – Corporate Governance Committees

Committees of the
Composition
Board

➢ Chairman: Independent Director , Members: Minimum 3 Directors

Audit Committee ➢ Composition: 2/3rd should be independent directors
(Mandatory) ➢ Qualification: All members should be financially literate* and at least 1 member shall have accounting or related financial management expertise**
➢ Secretary: Company Secretary

➢ Chairman: Independent Director (Chairperson of the Company though non-executive cannot be the Chairman)
Nomination and
➢ Members: Minimum 3 Directors
Remuneration
➢ Composition: All of whom should be non-executive directors and at least 2/3 should be independent
Committee
➢ Its role shall include determining criteria for appointment and remuneration of Directors and Independent Directors (IDs), KMPs and other employees, formulation of
(Mandatory) criteria for evaluation of IDs and the Board, devising a policy on Board diversity; the committee shall meet at least once in a year

Shareholders’
Grievance Committee / ➢ Chairman: Non-executive director, Members: Minimum 3 directors
Stakeholders ➢ Composition: Atleast 1 independent director
Relationship ➢ Its is meant to specifically look into various aspects of interest of the security holders
Committee ➢ The Chairperson of the Committee shall be present at the AGM to answer queries of the security holders
(Mandatory)
CSR Committee(1)
Risk Management ➢ Chairman: Non-executive director, Members: Minimum 3 directors
Committee (RMC) (2) ➢ The committee shall formulate the CSR policy, recommend amount for CSR activities and monitor them

Note: A director cannot be a member of more than 10 committees or a Chairman of more than 5 committees across all companies where he/she is a director
* The term “financially literate” means the ability to read and understand basic financial statements i.e. BS, P&L account, and statement of cash flows.
** A member will be considered to have accounting or related financial management expertise if he or she possesses experience in finance or accounting, or requisite professional certification in accounting, or any other comparable experience or background which results in the
individual’s financial sophistication, including being or having been a chief executive officer, chief financial officer or other senior officer with financial oversight responsibilities.
(1) Mandatory for Cos with NW of Rs. 500 cr or more or turnover of Rs. 1000 Crs or more or net profit of Rs. 5 Cr or more (2) Mandatory for top 1000 Cos basis of market capitalisation, as at the end of the immediate previous financial year

Company need to form a Committee for IPO. Restructuring needs to be completed prior to DRHP

57
 REGULATORY CONSIDERATIONS

Capital Restructuring – Bonus and Split Options & Eligibility for Offer for Sale

As per stock exchanges’ listing requirements, an Issuer need to have a paid-up equity share capital of at least Rs.10Cr
May consider Bonus/ Split before filing DRHP to optimize capital structure and to meet stock exchange requirements
Shares arising from a bonus issue will attract short term capital gains tax if held for a period of < 2 years at the time of IPO.
To minimize the tax implications, we recommend a bonus issue of shares along with split from the current face value
May need to increase / alter the authorized share capital as we recommend bonus / split before IPO with dual objective viz., tax efficiency and
IPO pricing affordability to the retail investor category. Moreover, any fresh issuance may also require an increase in the authorized share
capital
In case of any outstanding convertible securities, the same is required to be converted prior to the filing of DRHP/ RHP.
Only such fully paid-up equity shares may be offered for sale to the public, which have been held by the sellers for a period of at least one year
prior to the filing of the DRHP
Holding period of such convertible securities as well as that of resultant equity shares together shall be considered for the purpose of
calculation of 1 year at the time of filing the DRHP
Bonus issuance on such eligible shares will also be eligible for OFS
Further, there should not be any partly paid-up shares

58
 REGULATORY CONSIDERATIONS

Typical long lead items during an IPO which must be considered high priority

Key Areas Responsibility Deliverable

Incorporation in document along with auditor certificates, circle-ups and

1. Restated financials Auditor
MD&A preparation

2. Lender consents Company + Lenders Consents required before filing DRHP with SEBI

3. Customer consents Company + Customers Required to mention their names in DRHP and investor presentation

Updated records required since incorporation as part of diligence to draft

4. Secretarial records Company
various chapters in DRHP

All litigations for and against the company and promoters along with case
5. Litigation Company
papers and MIS

Backups to support individual profiles like educational qualifications,

Management / KMP backups / Director professional background, etc.
6. Company
Certificates Directors certificates confirming their details for disclosures and eligibility
check

Identification of Promoter / Promoter Group and certificates for required

7. Promoter/Promoter Group Company
disclosures and eligibility check

59
 REGULATORY CONSIDERATIONS

Due Diligence – Creation of a Virtual Data Room and Collation of Key Documents /
Information
Creation of a Virtual Data Room (VDR):
❑ IPO requires elaborate disclosures of the Issuer in the Offering Document since inception, which is included only after exhaustive due diligence carried out by the Book
Running Lead Managers and the legal counsels on the deal
❑ To accommodate this, the Issuer must collate all the regulatory, business, financial, legal and secretarial documents for perusal preferably in the virtual dataroom for
ease in conducting the due diligence exercise even remotely
Key IPO Due Diligence Documents / Information include:
Incorporation documents, Memorandum and Articles of Association
Corporate Regulatory documents relating to change in name, status, registered office, memorandum clauses, etc. since inception
Matters
Documents relating to activities like acquisitions, amalgamation, joint venture, etc., if any

Capital built-up details and changes in Authorised Share Capital since inception
Built-up of Promoters’ holding and Sources of Promoters’ Contribution
Capital
Structure Shareholding pattern with all relevant details, physical and demat shareholders, etc.
Details of ESOP scheme, if any
Details of outstanding convertibles, etc.

Detailed description of the business, business model, history and evolution

Business Business offerings with key attributes, differentiators, etc.
Competitive strengths, business strategies, etc.

Board of Directors with their personal details, other directorships, shareholding, conflicts, changes in the Board in the last 3 years,
Board and Key managerial remuneration, etc.
Management Key Managerial Personnel and their personal details including years and nature of experience, compensation details, shareholding,
conflicts, changes in the last 3 years, etc.

60
 REGULATORY CONSIDERATIONS

IPO Due Diligence Preparation (Contd.)

Industry Report covering industry growth, key players, market share, changing trends, etc.
Industry
Third party certification for the usage of industry details and data in the Offering Document

Corporate history, milestones, awards and recognitions, credit ratings, etc.

History Material acquisitions or divestments of business/undertakings, mergers, amalgamation, any revaluation of assets etc., in the last ten years
Corporate structure along with relevant details of subsidiaries, joint ventures, etc.
Material documents, key shareholder agreements, technical, financial and strategic partnerships, etc.

Promoters – their personal details, shareholding, conflict of interest, etc.

Promoter & Details of Promoter Group and Group Companies (companies covered under the applicable accounting standards and other companies
Promoter Group considered material by the issuer’s board of directors)
Disassociation with companies by Promoters in the last 3 years

Annual Reports of the Company, its subsidiaries, joint ventures, associates and group companies for the preceding 3 financial years
Financial MIS for business and operational matters for relevant disclosures including in MD&A
Financial
Audited Restated Financial Statements for the preceding 3 financial years and the stub period – on Consolidated basis along with relevant
annexures as prescribed

Details and documents for litigations by and against the Company, its subsidiaries, group companies
Litigation and
Litigation details and documents relating to the Directors and the Promoters
Licenses
Licenses and approvals obtained and required to be obtained

Regulatory documents including RoC filings, taxation matters, etc.

Secretarial/
Statutory records and registers for inspection as per the Companies Act, etc.
Material Docs
Minutes of meetings of the Board, Committees and Shareholders

61
 REGULATORY CONSIDERATIONS

Recent Amendments to SEBI Regulations

Conditions for Objects of the Issue* - Unidentified Acquisition or Investment Target

❑ Where the issuer company in its offer documents, set out an object for future inorganic growth but has not identified investment target, the amount for such objects and amount for
general corporate purpose shall not exceed 35% of the total amount being raised
❑ Amount earmarked in the offer documents, for objects where the issuer has not identified an investment target, shall not exceed 25% of the amount being raised by the issuer

Price Band – Minimum Threshold

❑ In case of book built issues, a minimum price band of be at least 105% of the floor price shall be applicable for all issues

Revised lock-in for Anchor Investors

❑ The existing lock in of 30 days shall continue for 50% of the portion allocated to anchor investor and for the remaining portion, lock in of 90 days from the date of allotment shall be
applicable for all issues opening on or after April 01, 2022

Revised allocation methodology for Non Institutional Investors (NIIs)

❑ For book built issues opening on or after April 01, 2022, the allocation in the NII category shall be revised as follows:
▪ 1/3 of the portion available to NIIs shall be reserved for applicants with application size of > INR 2 lakhs and up to INR 10 Lakhs
▪ 2/3 of the portion available to NIIs shall be reserved for applicants with application size of > INR 10 Lakhs
❑ Allotment of securities in case of NII category shall be on ‘draw of lots’, as is currently applicable for retail individual investors (RIIs) category (i.e. draw of lots to allot minimum
application size to applicants, in case of oversubscription and balance allotment on proportionate basis)

Monitoring Agency
❑ Credit Rating Agencies registered with SEBI can be appointed as monitoring agency for issue size of more than Rs. 100 cr.
❑ Monitoring agency to monitor 100% of net proceeds of the issue

*Such limits shall not apply if the proposed acquisition or strategic investment object has 62
been identified and disclosed in offer documents
 OTHER PARTICULARS

Thank You
Published in April 2024

IIFL - Investment Banking

24th Floor , One Lodha Place, Senapati Bapat Marg, Lower Parel (West), Mumbai: 400 013.
Tel: +91-22-4646-4713; Fax: +91-22-2493-1073; Email: ib@iiflcap.com

This presentation was prepared exclusively to serve as a platform for discussion and does not carry any right of publication or disclosure. Neither this presentation nor any of its
contents may be used for any other purpose without the prior consent of IIFL Securities Limited (IIFL). The information in this presentation reflects prevailing conditions and IIFL’s
judgment as of this date, all of which are accordingly subject to change. Specifically, the recommendations contained in this document represent IIFL’s judgment only. The
information and statistical data have been obtained from sources IIFL believe to be reliable but in no way are warranted by IIFL as to accuracy or completeness.
63