Samvardhana Motherson International Ltd., an auto components and equipment manufacturer, has approved raising funds by selling 33.8 crore equity shares. The company’s board met on Aug. 2 to approve the plan, setting a floor price of Rs 188.85 per share. This is a 2.5% discount compared to its previous closing price on the BSE. The board also approved the preliminary placement document on Sept. 16, along with the application form for the issue.
The company is raising funds through a qualified institutional placement (QIP), offering equity shares with a face value of Re 1 per share, as well as convertible debentures with a face value of Rs 1 lakh each, according to an official filing.
On Tuesday, 1.06 million shares of Samvardhana Motherson changed hands at market opening. The company’s stock has risen by 95% in the past 12 months and 90% since the start of the year. The stock’s trading volume so far is 3.4 times higher than its 30-day average.
This fundraising move is expected to strengthen Samvardhana Motherson’s financial position and support its growth initiatives.
Investec and CITI Issue Bearish Outlook on Samvardhana Motherson: Price Targets Set at Rs 195 and Rs 105
Key Highlights
Samvardhana Motherson QIP Opens
The company plans to raise Rs 6,400 crore through equity shares and Rs 2,250 crore via Compulsorily Convertible Debentures (CCDs).
The total issue size will not exceed 33.9 crore equity shares, which includes shares that may be issued after the conversion of CCDs.
The indicative price range for the equity shares is between Rs 186.3 and Rs 193.8 per share.
The face value of the CCDs is set at Rs 1 lakh, with an interest rate of 6.5%.
CCDs can be converted into equity shares on or before September 30, 2026.
The funds raised will be used to repay the company’s debt.
