Kapil Raj Finance Limited faces a mandatory open offer from its new acquirers, Arpit Agarwal, Megha Agarwal, and Arpit Agarwal (HUF), to purchase up to 9,92,12,282 equity shares representing 26% of the expanded voting share capital. The offer price is fixed at ₹2.24 per share, aggregating to a maximum consideration of ₹22.22 crore.

This offer is triggered by the proposed preferential issue of 27,21,85,700 equity shares, which will result in the Acquirers holding 69.57% of the company's expanded paid-up equity capital. The transaction is structured as a share swap with Henyo Pack Limited, where Kapil Raj Finance will acquire 90% of Henyo Pack’s equity against the issuance of new shares to the Acquirers.

Offer Structure and Timeline

The open offer is being made under Regulation 3(1) and 4 of the SEBI (SAST) Regulations, 2011. The tendering period is scheduled to commence on November 16, 2026, and close on November 30, 2026. The Identified Date for determining eligible shareholders is October 30, 2026.

The Acquirers have deposited ₹5.56 crore in an escrow account with ICICI Bank, representing more than 25% of the total offer consideration. The Manager to the Offer is Novus Capital Advisors Private Limited.

Financial Context and Valuation

Kapil Raj Finance reported a profit after tax of ₹41.13 lakh for FY26, a significant turnaround from a loss of ₹0.84 lakh in FY25. The company’s net worth stood at ₹1,403.40 lakh as of June 30, 2026. The offer price of ₹2.24 is justified based on the highest negotiated price under the Share Swap Agreement and exceeds the volume-weighted average market price of ₹1.65 for the 60 trading days preceding the public announcement.

What the Numbers Show

A critical observation from the filing is the shift in control dynamics and public holding. Post the preferential issue and assuming full acceptance of the open offer, the Acquirers will hold 95.57% of the company’s expanded voting share capital. Consequently, public shareholding will drop to 4.43%, falling significantly below the minimum public shareholding requirement of 25% mandated by SEBI LODR Regulations. The Acquirers have undertaken to take necessary steps to facilitate compliance with these regulations, indicating a potential future dilution or strategic adjustment to restore public float levels.

Strategic Rationale

The primary objective of the acquisition is to gain management control over Kapil Raj Finance. The underlying transaction involves Kapil Raj Finance acquiring 90% of Henyo Pack Limited, a packaging manufacturer, thereby diversifying its business activities beyond financing and trading. The Acquirers have stated they do not intend to delist the company pursuant to this offer and have no plans to alienate significant assets for a period of two years.

Arpit Agarwal, Megha Agarwal, and Arpit Agarwal HUF have initiated a mandatory open offer to acquire up to 9.92 crore equity shares of Kapil Raj Finance Limited , representing 26% of the expanded voting share capital, at a price of ₹2.24 per share.

The offer is triggered by a proposed preferential allotment of 26.55 crore shares to the acquirers, which will increase their holding to 69.57% of the company’s expanded capital. This transaction involves a share swap with Henyo Pack Limited, a transferor company promoted by the acquirers.

Offer Structure and Pricing

The open offer price of ₹2.24 was determined under Regulation 8(2) of the SEBI (SAST) Regulations. It exceeds the volume-weighted average market price for the 60 trading days preceding the public announcement, which stood at ₹1.65. The shares are classified as frequently traded, with an annualized trading turnover of 143.96% during the twelve months prior to the announcement.

Financial Arrangement and Approvals

The total consideration for full acceptance of the offer amounts to ₹22.22 crore. The acquirers have deposited ₹5.56 crore, representing more than 25% of the maximum consideration, into an escrow account with ICICI Bank Limited. The remaining funds are stated to come from internal resources.

The preferential issue requires shareholder approval and in-principle listing approval from BSE Limited. Upon completion of the open offer and assuming full acceptance, the acquirers will hold 36.47 crore shares, constituting 95.57% of the expanded voting share capital. The acquirers have undertaken to comply with minimum public shareholding norms post-acquisition.

What the Numbers Show

A divergence exists between the target company’s operational scale and its valuation metrics. For FY26, Kapil Raj Finance reported total revenue of ₹80.45 lakh and a net profit of ₹41.13 lakh. However, the net worth stood at ₹1348.50 lakh as of March 31, 2026. The offer price of ₹2.24 implies a market capitalization significantly higher than the book value per share, suggesting the valuation is driven by asset backing or future potential rather than current earnings power, given the modest revenue base relative to the equity size.