The maiden rights issue of Minda Industries is set to open today, i.e. August 25. The last day for submission of the application will be on September 8, 2020. The auto parts maker said that its board has fixed Rs 20 per share as the issue price for the issue. The issue price is at 26.8 percent discount to August 21's closing price of Rs 341.50 per share.

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The company said that it will issue 1 crore fully paid equity share of face value of Rs 2 each for an amount aggregating to Rs 250 crore.

“The company has made necessary arrangements with NSDL and CDSL for the credit of the rights entitlements in dematerialized form in the Demat account of the eligible equity shareholders as on the record date,” Minda Industries said.

A rights issue is when a company offers its existing shareholders the chance to buy additional shares for a reduced price. Usually, the discounted price will stand for a specified time frame, after which it is returned to normal.

Here are the key things to know about the issue:

1) Rights Entitlements will be credited to eligible investors by August 24 and the trading in Rights Entitlement will begin on August 25.

2) The company proposed to issued 97,11,739 fully paid equity share of the face value of Rs 2 each under the rights issue. Outstanding equity shares after the rights issue would be 27,19,28,704 equity shares assuming full subscription to the issue.

3) The company is planning to raise up to Rs 242.79 crore.

4) The company said shareholders can apply for 1 share for every 27 shares they own.

5) After submission of application, rights equity shares will be credited to eligible investors by around September 18, which will be merged with existing full paid-up equity shares and the trading will commence on around September 22.

6) The last date for on market renunciation would be September 3, 2020.

7) Company will use issue proceeds for repayment and/or prepayment of all or of a portion of the principal and/or interest of certain borrowings

Financials:

For the June quarter, the auto ancillary firm's standalone net loss was Rs 53.11 crore as against Rs 31.6 crore profit in the year-ago period. The company's revenue from operation also fell 73 percent YoY to Rs 228.16 crore, down from Rs 836.1 crore in Q1FY20. It also reported an exceptional loss of Rs 81.47 crore during the quarter under review.

The stock shed as much as 4.3 percent to Rs Rs 326.50 per share on BSE on subdued earnings.

First Published:Aug 24, 2020 2:10 PM IST