SJ Corporation Ltd: Promoter Stakes Diluted Following ₹3.50 Crore Preferential Allotment
SJ Corporation Ltd executed a major preferential allotment of 3.50 crore equity shares, expanding its capital base from ₹83.55 lakh to ₹4.34 crore. The transaction resulted in substantial dilution of promoter shareholdings, with Savji D. Patel and Ushaben Savjibhai Patel experiencing significant percentage declines while maintaining their absolute share counts.
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SJ Corporation Ltd has reported substantial dilution in promoter shareholdings following a preferential allotment of equity shares completed on March 20, 2026. The development represents a significant change in the company's ownership structure, with multiple promoters experiencing percentage stake declines due to the issuance of 3.50 crore new equity shares to proposed promoters and non-promoters.
Shareholding Changes
The company witnessed significant dilution across promoter holdings following the preferential allotment. Promoter Savji D. Patel's shareholding decreased from 37.39% to 7.21%, while Ushaben Savjibhai Patel experienced a decline from 33.46% to 6.45%. Both promoters maintained their absolute share holdings of 31.24 lakh and 27.96 lakh shares respectively despite the percentage dilution.
| Promoter: | Before Allotment | After Allotment | Absolute Shares | Change (%) |
|---|---|---|---|---|
| Savji D. Patel: | 37.39% | 7.21% | 31.24 lakh | -30.18% |
| Ushaben Savjibhai Patel: | 33.46% | 6.45% | 27.96 lakh | -27.01% |
Capital Structure Expansion
The company's equity capital underwent significant expansion through the preferential allotment. The total equity share capital increased from ₹83.55 lakh to ₹4.34 crore, with the share count rising from 83.55 lakh to 4.34 crore equity shares of Re. 1 each. The company allotted 3.50 crore new equity shares through this preferential allotment.
| Parameter: | Before Allotment | After Allotment | Change |
|---|---|---|---|
| Total Equity Capital: | ₹83.55 lakh | ₹4.34 crore | +₹3.50 crore |
| Number of Shares: | 83.55 lakh | 4.34 crore | +3.50 crore |
| Share Face Value: | Re. 1 each | Re. 1 each | No change |
Regulatory Compliance
The disclosures were made in compliance with Regulation 29(2) of SEBI (Substantial Acquisition of Shares & Takeovers) Regulations, 2011. Both Savji D. Patel and Ushaben Savjibhai Patel, identified as promoters of the company, submitted the required documentation to BSE Limited on March 31, 2026. The company communicated these changes to BSE Limited on April 2, 2026, with shares listed under scrip code 504398.
Transaction Impact
The preferential allotment completed on March 20, 2026, resulted in the dilution of existing shareholders' percentage holdings without any actual sale or transfer of shares from promoter holdings. The issuance of 3.50 crore new shares to other parties reduced proportionate ownership across existing stakeholders. The transaction involved no encumbrances, voting rights transfers, or convertible securities, representing a standard capital raising exercise through preferential allotment to strengthen the company's financial position.
What strategic initiatives or expansion plans will SJ Corporation pursue with the ₹3.50 crore raised through this preferential allotment?
How might the significant dilution of promoter holdings from 70.85% to 13.66% affect the company's governance and decision-making processes?
Will the existing promoters consider increasing their stake through open market purchases to regain greater control over the company?
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