The auto ancillary company launched a qualified institutional placement (QIP) of equity shares on Tuesday (22 March 2021).
On 13 January 2021, the company's board had approved the proposal for issuance of equity shares by way of 'qualified institutions placement (QIP). The same was approved by the company's shareholder on 17 February 2021.The QIP issue committee of the board of directors of the company, at its meeting held on 22 March 2021, authorised the opening of the QIP issue and approved the floor price of Rs 395.41 per equity share, the company said in a regulatory filing made after market hours yesterday. The company further added that it may at its discretion offer a discount of not more than 5% on the floor price for the issue.
The floor price is at 2.84% discount to Varroc Engineering's closing price of Rs 406.95 yesterday.
The committee of directors (capital raising) is scheduled to be held on or after 25 March 2021 to to consider and approve the issue price, including a discount for the equity shares to be allotted to qualified institutional buyers, pursuant to the issue.
The company intends to use the net proceeds from QIP to meet the capital expenditure and working capital requirements; repayment of debt, expansion and modernization; and general corporate purpose.
Varroc Engineering is an auto component manufacturer. The group designs, manufactures and supplies exterior lighting systems, plastic and polymer components, electricals-electronics components, and precision metallic components to passenger cars, commercial vehicles, two-wheelers, three-wheelers, and off-highway vehicle OEMs directly worldwide.
The company reported consolidated net loss of Rs 136.96 crore in Q3 FY21 compared with net profit of Rs 29.33 crore in Q3 FY20. Net sales during the quarter jumped 24.6% YoY to Rs 3492.66 crore.
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Shares of Varroc Engineering fell 2.36% to Rs 397.35.
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