Vascon Engineers rose 2.15% to Rs 23.80 at 9:55 IST on BSE after the company said that it recently raised Rs 100 crore through a rights issue.
The company made announcement after market hours yesterday, 2 September 2015.
Meanwhile, the BSE Sensex was up 175.79 points, or 0.69%, to 25,629.35.
On BSE, so far 2.13 lakh shares were traded in the counter, compared with an average volume of 1.46 lakh shares in the past one quarter.
Shares of a small-cap company hit a high of Rs 24.40 and a low of Rs 23.50 so far during the day. The stock hit a 52-week high of Rs 31.81 on 15 September 2014. The stock had hit a 52-week low of Rs 14.60 on 23 June 2015.
Ahead of the announcement, the stock had jumped 8.37% to settle at Rs 23.30 yesterday, 2 September 2015.
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Vascon Engineers said that the rights issue was subscribed by over 130%. The promoters of the company infused Rs 60 crore through the issue, thereby, increasing the promoter shareholdings to 48.02%.
From the total fund raised through the issue, Rs 62 crore is being used to repay debt. This brings down the debt level of the company from approx Rs 335 crore to Rs 273 crore. The remaining Rs 38 crore is being used mainly to drive mainly residential projects, namely Windermere in Koregaon Park and Ela near Magarpatta city.
Meanwhile, the company said that its engineering, procurement & construction (EPC) business has a strong order book of approximately Rs 1000 crore, most of which is to be executed in the next 24 months. These projects are located in various cities including Pune, Mumbai, Chennai and Lucknow.
Apart from the Rs 100 crore raised, Vascon said it will raise another Rs 100 crore through the sale of its non-core assets like hotels, etc. The proceeds from these sales will be used to further reduce debt to sub Rs 200 crore levels. This will also help in improvement of cash flows and performance, the company said.
Vascon will also enter the affordable housing market with projects at Katvi, Off. Talegaon MIDC, Old Mumbai-Pune Road soon. The company will use the design and build strategy in these projects that will enhance efficiency in time and reduce the cost of construction.
Vascon also announced that the topline of its subsidiary GMP Tech Solutions has reached almost Rs 250 crore. GMP Tech Solutions specializes in manufacturing of fire doors, aluminum doors, clean room partitions, aluminum sections etc. Vascon took over GMP in the year 2010, when the turnover was 125 crore.
On consolidated basis, Vascon Engineers reported net loss of Rs 0.82 crore in Q1 June 2015 compared to net loss of Rs 8.97 crore in Q1 June 2014. Total income rose 8.8% to Rs 154.60 crore in Q1 June 2015 over Q1 June 2014.
Vascon Engineers is a premier realty, engineering, procurement & construction (EPC) & clean room partitioning companies.
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