Grasim Industries, an Aditya Birla Group company, has set a price of ₹1,812 per share for its ₹3,999.80 crore rights issue, with January 10 as the record date. This is at a 12.40% discount to Thursday’s closing price of ₹2,068.60.
The company will issue up to 22 million shares with an entitlement ratio of six shares for every 179 shares of the company held as on record date, Grasim Industries said in a regulatory update.
The issue will open on January 17, and close on January 29, it added. The company’s board had approved the proposal to raise funds through a rights issue, not exceeding ₹4,000 crore, at its meeting held on October 16, 2023. The company intended to fund its ongoing capital expenditure plan, repay existing borrowings, and support general corporate purposes, it had said in October.
In September, Grasim Industries announced its foray into the paints sector with the market launch of a full suite of decorative paints in the fourth quarter of this fiscal. The company would launch the products under the brand name Birla Opus, with the aim of becoming the country’s second-largest player.
The company’s manufacturing plants, with a total production capacity of 1,332 million litres per annum (MLPA), are located in Haryana, Punjab, Tamil Nadu, Karnataka, Maharashtra, and West Bengal.
Earlier in January 2021, Grasim announced plans to enter the paints business with a Rs 5,000-crore initial investment spread over three years. Later in May 2022, it announced plans to invest Rs 10,000 crore by FY25, double of what was initially earmarked.
Grasim Industries’ total capex outlay for the second quarter ended September was at ₹1,650 crore. Further, its board also approved an additional capex of ₹144 crore for different businesses, and another ₹138 crore for the current fiscal.
The budgeted spend for FY24 stands revised at ₹5,929 crore. Grasim Industries had spent ₹4,307 crore as capex in FY23.