1:10 Bonus Shares; 12:29 Rights Issue & Stock Split From Rs 10 To Rs 5 To Re 1: Penny Stock Hit 5 Per Cent Upper Circuit As Board Announces 100 Crore Fund Raise
From Re 0.49 per share (52-week low) to Rs 0.89 per share, the stock gave 81.63 per cent returns.
Today, shares of Srestha Finvest Ltd hit 5 per cent to Re 0.89 per share from its previous closing of Rs 0.85. The stock’s 52-week high is Rs 1.28 while its 52-week low is Re 0.49.
The Board of Directors of the Company, in their meeting held on October 9, 2024, approved two significant proposals:
Firstly, the Board approved raising funds through a Qualified Institutional Placement (QIP). This involves issuing equity shares with a face value of Re 1 each for a total amount not exceeding Rs 100 crore. The issuance will be subject to necessary approvals from the shareholders and regulatory bodies. Issued up to 93,00,00,000 (Ninety-Three Crores) equity shares of Re 1 each at an issue price of Rs 1.05 each including the Premium of Rs 0.05 each to non-promoters.
Secondly, the Board approved increasing the Company's borrowing limits to Rs. 500 Crores. This decision is made under Section 180(1)(c) of the Companies Act, 2013 and will require shareholder approval.
Corporation Actions
The company has undergone significant restructuring in recent years. In 2016, a stock split from Rs 10 to Rs 2 was implemented to increase liquidity. Following this, a bonus issue of 1:10 was announced in 2018, diluting the existing shares but providing shareholders with additional equity. More recently, in 2024, a rights issue of 12:29 was offered, allowing existing shareholders to purchase additional shares at a discounted price. To further enhance liquidity and affordability, another stock split, this time from Rs 2 to Re 1, was executed in September 2024. These corporate actions have collectively aimed to improve the company's capital structure, attract new investors, and potentially increase shareholder value.
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About the Company
Established in 1985, Srestha Finvest Ltd. is a multifaceted financial services company offering various solutions, including loans, financing, and investments. They hold a specific regulatory license: a Category B Non-Systematically Important Non-Deposit Taking NBFC - Investment and Credit Company. This allows them to provide loans secured by various assets (securities, movable and immovable properties), offer hire purchase and leasing options, and engage in trading and investing shares. The company has a market cap of Rs 145 crore.
Quarterly Results
The total revenue increased by 1,634 per cent to Rs 3,950 lakh in Q1FY25 compared to the total revenue of Rs 227.80 lakh in Q1FY24. The company reported a net profit of Rs 3,100.62 lakh in Q1FY25 compared to a net profit of Rs 43.90 lakh in Q1FY24, an increase of 6,963 per cent.
Annual Results
The total income increased by 269 per cent to Rs 1,013.01 lakh in FY24 compared to the total income of Rs 274.56 lakh in FY23. The company reported a net profit of Rs 173.86 lakh in FY24 compared to a net loss of Rs 497.41 lakh in FY23, an increase of 135 per cent. The company reported a net profit in FY24 after reporting a net loss for the past 5 years i.e., FY23, FY22, FY21, FY20 and FY19.
From Re 0.49 per share (52-week low) to Rs 0.89 per share, the stock gave 81.63 per cent returns. Investors should keep an eye on this micro-cap stock.
Disclaimer: The article is for informational purposes only and not investment advice.