Black Box Limited has filed its monitoring agency report for the quarter ended December 31, 2025, detailing the utilization of proceeds from its preferential issue of convertible warrants. The report, prepared by CARE Ratings Limited as the monitoring agency, provides insights into the company's fund deployment and compliance with regulatory requirements.

Issue Overview and Revisions

The company's preferential issue underwent significant modifications from its original structure. Initially planned for Rs. 410.00 crore, the issue size was reduced to Rs. 386.36 crore due to undersubscription. The company allotted 92,65,215 fully convertible warrants at an issue price of Rs. 417 each, compared to the originally proposed 98,32,123 warrants.

The company revised its issue objects through a special resolution passed via postal ballot on March 19, 2025. The revision added "Working Capital requirements of the Company" as a new object, while adjusting allocations for existing objects.

Object-wise Fund Allocation

The revised fund allocation reflects the company's strategic priorities and reduced issue size:

Fund Utilization During Q3 FY26

During the quarter ended December 31, 2025, the company utilized Rs. 2.08 crore specifically for working capital requirements, primarily for employee salary payments. This utilization was in line with the revised objects approved by shareholders.

Deployment of Unutilized Proceeds

The company has deployed its unutilized proceeds of Rs. 22.24 crore in fixed deposits with Bank of Maharashtra and maintains a monitoring account with HDFC Bank. The fixed deposits carry interest rates ranging from 3.75% to 4.50%, with varying maturity dates in early 2026.

Monitoring Agency Assessment

CARE Ratings Limited, serving as the monitoring agency, reported no major deviations from earlier monitoring reports. The agency confirmed that the company obtained necessary shareholder approvals for object revisions and that fund utilization during the quarter aligned with the revised objects.

The monitoring agency noted that while the company routed funds through its current account, which also recorded other business transactions, proper verification was conducted through bank statements, management certificates, email confirmations, and chartered accountant certificates.

Compliance and Timeline Status

The report indicates that the company remains compliant with regulatory requirements regarding fund utilization. The warrants have an 18-month conversion period from the date of allotment, and the company continues to utilize funds within the prescribed timelines for each tranche received.

The monitoring agency confirmed no delays in implementation of objects and noted that all fund utilization has been in accordance with the revised objects approved by shareholders through the special resolution.

Black Box Limited has announced a significant acquisition in the Brazilian market through its step-down subsidiary. The company disclosed that Black Box Do Brasil Indústria e Comércio Ltda. has entered into a definitive agreement to acquire 2S Inovações Tecnológicas, a leading Brazilian solutions integrator specializing in IT infrastructure, technologies, and managed services.

Acquisition Details

The transaction involves a comprehensive acquisition structure with multiple payment components:

The acquisition does not fall under related party transactions, and no promoter or group companies have any interest in the target entity. The transaction is subject to customary closing conditions, certain consents and approvals.

About 2S Inovações Tecnológicas

2S Inovações Tecnológicas is a well-established Brazilian technology solutions provider with a strong market presence spanning over 35 years. Founded in 1992 and based in São Paulo, Brazil, the company has evolved into a comprehensive end-to-end technology partner serving primarily private-sector customers across Global Enterprise, Enterprise, Mid-market, and Small and Medium Business segments.

Service Portfolio and Capabilities

2S offers a comprehensive range of technology solutions and services across multiple domains:

Core Service Offerings:

• Enterprise Networks including LAN, WAN, SD-WAN, Wi-Fi 6/6E/7, IoT, and Industrial Solutions
• Datacenter and Cloud Solutions encompassing Servers, ACI, Hyperconverged Infrastructure, Multi-Cloud, and AI Solutions
• Cybersecurity and Network Protection covering IT & OT Security, Zero Trust, SASE, Firewalls, Endpoint and Data Protection
• Digital Workplace & Collaboration solutions including Webex, Teams, Zoom, Contact Center and Calling Solutions
• Observability and Performance Management
• Implementation, Integration, and Project Management Services
• Managed Services, Maintenance, Monitoring & NOC with 24x7 support
• IaaS and OPEX-based cloud offerings

Financial Performance Track Record

2S has demonstrated consistent growth in recent years, with revenue figures based on Brazil GAAP:

Strategic Rationale

The acquisition aligns with Black Box Limited's long-term strategic objectives to expand its presence in Latin America and strengthen its end-to-end service portfolio. The transaction is expected to accelerate growth in high-value managed and recurring services, leveraging 2S's established customer base and comprehensive service capabilities in the Brazilian market. This move positions Black Box to better serve enterprise customers across the region while enhancing its technology solutions and managed services offerings.