VIP Industries will raise Rs 500 crore during the current financial year, the company said in a stock exchange filing. The board approved the fund-raising plan at a meeting held the same day.
The company said the money could be raised in one or more tranches. It did not specify a timeline for completing the exercise.
VIP Industries Rs 500 crore fundraise: How will the company raise the money?
The luggage maker has kept its options open on the instrument. Funds could come through equity shares with a face value of Rs 2 each, the filing said. Debt securities, convertible securities, depository receipts such as ADRs or GDRs, foreign currency convertible bonds, warrants and preference shares are also on the table, as per the filing.
The route to market is similarly broad. VIP Industries said the issue could go through a public offer, a rights issue, a qualified institutional placement, a debt issue or a preferential allotment. A combination of these modes is also possible, the company said.
Any fundraise will need regulatory and shareholder clearances. The filing said the plan remains subject to statutory, regulatory, shareholder and stock exchange approvals, along with any other sanctions that may be required.
Why is VIP Industries raising Rs 500 crore?
In the filing, VIP Industries linked the move to a turnaround in its business. The company said it is “back on the growth path after several quarters.” It said the fresh capital would support working capital needs and fund growth initiatives already underway.
The company added that the investment is meant to strengthen its position in the luggage and travel category as new growth opportunities emerge in that space.
About VIP Industries
VIP Industries, headquartered in Mumbai, is one of Asia’s largest luggage manufacturers and traces its origins to 1968, when it was incorporated as Aristo Plast. The company sells across price points through brands including VIP, Skybags, Carlton, Aristocrat, Alfa and Caprese, covering hard and soft luggage, backpacks, handbags and travel accessories. It manufactures through units in India and Bangladesh and distributes through thousands of points of sale across exclusive stores, multi-brand retail, large format outlets and e-commerce.
VIP Industries share price today
VIP Industries’ share price has declined 0.72% as of intraday on September 21. The company’s share price declined 4.47% in the past month. Furthermore, VIP Industries’ share price declined 34.06% in the last year.