Apollo Pipes has announced a couple of important decisions at its meeting held today, August 31, after market hours. The pipemaker will invest Rs 300 crore for the incorporation of a subsidiary to tap into the country’s tiles and ceramics business.
Also, its board has approved the issuance of 31 lakh warrants amounting to Rs 189 crore to the non-promoter category, and the company will increase its authorised share capital for the same. Here are the details of these developments.
Apollo Pipes: Rs 300 investment for ceramic subsidiary
Apollo Pipes will undertake an investment of Rs 300 crore for the proposed incorporation of a subsidiary to enter the tiles and ceramics business. The subsidiary will be engaged in the business of manufacturing, trading, and distribution of tiles, ceramics, and related products.
According to its regulatory filing, Apollo Pipe’s managing director, Sameer Gupta, and the company’s joint managing director, Arun Agarwal, will handle the responsibilities pertaining to the subsidiary, including the manner in which it is phased out and the timing of investment.
Apollo Pipes: Board to issue 31 lakh warrants
The company’s board has also approved the issuance of 31 lakh warrants of face value Rs 10 each, at a price of Rs 610. This includes a premium of Rs 600 per warrant, amounting to Rs 189 crore.
Each warrant shall be fully convertible and will be issued on a preferential basis to the ‘Non-Promoter’ category for a cash consideration. This includes eight investors: AGDG Enterprises LLP, Rachita Gupta, Gaurav Arora, Rohit D Gupta, Anshvardhan Modi, Poonam Krishna Patel, Ekta Tayal, and Sukumar Srinivas.
Post-preferential issue stakeholding of these eight investors shall stand at a total of 6.31%
The issuance is subject to the approval of shareholders of the company and other requisite statutory and regulatory approvals.
Apollo Pipes: Board approves increasing share capital
The company’s senior management has also approved the proposal to increase its authorized share capital to Rs 60 crore from Rs 50 crore by dividing 6 crore equity shares of Rs 10 each.
This decision has been taken to ensure that adequate authorised share capital is available for the allotment of shares upon conversion of warrants, subject to the company members.
Apollo Pipes share price
The company’s stock ended Monday’s trade on the exchanges at Rs 627.05, down nearly 1% from its previous close. Over the past one month, its share price has increased by more than 20%, while over the past six months, its stock has delivered a return of 80%.