Solar rooftop penny stock: Rights issue ratio of 4:1; Rejected applications, Promoters come to the rescue!

To facilitate this resolution, the company extended the deadline until February 12, 2024, to allow the promoters time to arrange the necessary funds and apply for the additional shares.

In the world of stocks, sometimes even the sunniest of prospects can encounter unexpected shadows. Such is the tale of IND Renewable Energy Ltd, a penny stock engaged in the business of generation of Solar Power including roof top solar, whose recent foray into a rights issue stirred up a surprising twist.

The stage was set when IND Renewable Energy announced its rights issue, offering up to 1,21,09,440 Equity Shares at a price of Rs. 21 per share, inclusive of a premium of Rs. 11 per share. Excitement brewed as the company aimed to raise funds amounting to Rs. 2,542.98 Lakhs, inviting its shareholders to participate in the offering in a ratio of 4 shares for every 1 held.

However, as the issue progressed, a cloud of uncertainty descended. Despite an overwhelming response (received subscription for 1,43,31,856 equity shares, which is 118.35 per cent of the issue size) from eager investors, the company found itself falling short of the minimum subscription threshold of 90 per cent. How could this be?

Delving into the intricacies of the issue, it was revealed that a significant portion of applications, totaling 66,23,800 equity shares, were rejected. These applications belonged to individuals who neither held shares on the record date nor possessed rights entitlements at the close of the issue. With these rejections, only 76,98,606 valid bids remained, falling short of the required threshold.

Faced with this unexpected hurdle, the promoters of IND Renewable Energy took decisive action. In a bid to meet the minimum subscription criteria, they committed to subscribing to the unsubscribed portion of 32,00,890 shares at the issue price. This strategic move not only demonstrated their unwavering belief in the company's vision but also showcased their dedication to ensuring the success of the rights issue.

To facilitate this resolution, the company extended the deadline until February 12, 2024, to allow the promoters time to arrange the necessary funds and apply for the additional shares. Upon the successful transfer of funds into the Rights Issue Account, IND Renewable Energy pledged to provide transparent documentation, including bank statements and certificates from chartered accountants, as proof of their commitment.

Note: The stock last traded was on February 05 as trading is suspended on account of GSM. However, the crux of the article is to highlight a development related to the rights issue of the company.

Disclaimer: The article is for informational purposes only and not investment advice. 

1 comments on article "Solar rooftop penny stock: Rights issue ratio of 4:1; Rejected applications, Promoters come to the rescue!"

Binoy

Good

2/11/2024 12:59 AM

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