Network People Services Technologies Ltd

• Company clarifies use of ₹3.18 crore from preferential issue for office rent, salaries. • Monitoring agency noted classification discrepancy, no fund misuse. • Funds used for general corporate purposes as per SEBI rules. • Management committed to transparent governance and compliance.

📝 Clarification on Preferential Issue Fund Utilisation

📌 Background on Preferential Allotment:

Preferential allotment means the company sells shares to certain investors at a specific price. The money collected must be used as promised and follow regulations.

💰 Details on Fund Utilization:

The company used ₹3.18 crore from this fund to pay for office rent and employee salaries, which are common business needs.

🔍 Observation by Monitoring Agency:

The agency noted the company did not provide detailed item-wise expense descriptions under 'General Corporate Purpose' in the offer document, causing a classification observation.

⚖️ Company’s Response:

• No misuse or diversion of funds occurred.
• The money was used for legitimate business activities.
• The observation is about classification, not misuse.
• The agency also said no major deviation was seen overall.

📋 Regulatory Context:

SEBI regulations say 'General Corporate Purpose' includes expenses like office rent and salaries, which the company incurred.

🔎 What This Means for Investors:

• This is a clarification on accounting and disclosure.
• Fund usage aligns with rules and business needs.
• The company shows commitment to transparency and governance.

📈 Quantitative Data:

₹3.18 crore used for operational expenses from preferential allotment proceeds.

🧑‍🏫 Simple Explanation:

The company got money from investors to run the business and used some for rent and salaries. A watchdog suggested they explain such expenses clearer, but found no wrong use of money. The company assures compliance and values investors' trust.