Rossari Biotech fell 3.05% to Rs 1037.55, extending losses for second day in a row.
The stock has declined by 6.73% in two sessions, from its recent closing high of Rs 1,112.45 recorded on 23 March 2021.
After market hours on Tuesday (23 March 2021), Rossari Biotech announced that its board approved issuing 30,12,046 equity shares of face value of Rs 2 each, on a preferential basis. The board determined a floor price of Rs 996 per equity share or such higher price, aggregating to Rs 300 crore.
The floor price of Rs 996 apiece is at a discount of 10.47% to Rossari's closing price of Rs 1,112.45 per share on Tuesday.
This preferential issue is subject to necessary approvals, including from the company's shareholders. The board will seek shareholders approval for the same at the extra ordinary general meeting to be held on 17 April 2021.
The company proposes to allot preferential shares to SBI Mutual Fund, Ramesh Siyani, Arpit Khandelwal, Malabar Select Fund, Malabar India Fund, Malabar Value Fund and India Acom Fund. Post allotment, SBI Mutual Fund's stake in the company will increase to 7.04% from 5.51% currently.
The firm said that the funds from this issue will further strengthen its balance sheet profile and will also augment the financial flexibility to address medium-to-long term growth prospects. Rossari proposes to utilize the net proceeds to evaluate & invest in inorganic growth opportunities, within its core chemistries, with a view to diversify its product portfolio, expand geographical reach and augment end-user industry applications. This will further enable the company to build a strong upcoming pipeline of new products, with impetus on sustainability and environment-friendliness.
Investors who would be allotted shares under the preferential mode are SBI Mutual Fund, Ramesh Siyani, Arpit Khandelwal, Malabar Select Fund, Malabar India Fund, Malabar Value Fund and India Acom Fund.
Rossari Biotech is a speciality-chemicals manufacturer providing intelligent and sustainable solutions for customers across industries. On a consolidated basis, the company posted an 18.4% rise in net profit to Rs 21.6 crore on a 29.3% rise in net sales to Rs 209.98 crore in Q3 FY21 over Q3 FY20.
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