Reliance Power’s board of directors approved the issue of preferential shares to raise ₹1,524.60 crore, the company said in an exchange filing on Monday.
Reliance Power announced the preferential share issue on Monday, September 23.
Reliance Power Ltd’s board of directors approved the issue of preferential shares to raise ₹1,524.60 crore, the company said in a filing on the Bombay Stock Exchange (BSE) on Monday, September 23.
“We hereby inform you that the Board of Directors at its Meeting held today i.e., Monday, September 23, 2024, has approved issuance of up to 46,20,00,000 equity shares and/or warrants convertible into equity shares of the Company at an Issue Price of Rs. 33/- per share aggregating ₹1524.60 crore through preferential allotment,” said the company in the exchange filing.
Reliance Power shares closed 4.98 per cent higher at ₹38.16 after Monday’s trading session, compared to ₹36.35 at Friday’s market close. The company filed the preferential share issue notification with the exchange after market hours.
The board has approved the issue of up to 46,20,00,000 or 46.20 crore equity shares at an issue price of ₹33 per share or warrants convertible into equity shares of the company, according to the filing.
Reliance Infrastructure Limited, the promoter of Reliance Power, will enhance its equity stake by over ₹600 crore. The other investors in the preferential issue are Authum Investment and Infrastructure and Sanatan Financial Advisory Services, according to the company statement.
What does it mean for Reliance Power?
Reliance Power aims to use the proceeds raised from the preferential share issue to expand business operations directly or through investment in subsidiaries and joint ventures. The company also plans to reduce its debt and use the money raised for general business purposes, it said in the exchange filing.
Reliance Power’s renewable energy sector participation will also be supported through the enhanced capital, as per the company filing.
“Preferential Issue will enhance the company’s networth from over ₹11,155 crore to over ₹12,680 crore,” said the company in the statement. The listed entity has zero bank debt.
The company will also host a postal ballot to seek shareholder approval for the preferential share issue.
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