Capital Trust Limited has announced a crucial board meeting scheduled for September 18, 2025, to deliberate on a potential rights issue of equity shares. This development comes as the company explores avenues to strengthen its capital base and fund future growth initiatives.

Key Points of the Announcement

• Board Meeting Date: September 18, 2025
• Primary Agenda: Consideration of a rights issue of equity shares
• Share Details: Equity shares with a face value of ₹10 each
• Eligible Participants: Existing shareholders of the company

Rights Issue Committee

As part of the process, the board will also consider the formation of a dedicated 'Rights Issue Committee'. This committee will be tasked with overseeing various aspects related to the proposed rights issue, ensuring a smooth and compliant execution of the fund-raising initiative.

Regulatory Compliance

The company has emphasized that the proposed fund-raising through the rights issue is subject to:

1. Necessary regulatory approvals
2. Compliance with the Companies Act, 2013
3. Adherence to SEBI regulations, particularly the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018
4. Conformity with other applicable laws

Implications for Shareholders

If approved, the rights issue would provide existing shareholders of Capital Trust Limited with the opportunity to increase their stake in the company proportionately. This method of raising capital is often viewed favorably by investors as it allows them to maintain their ownership percentage while supporting the company's growth plans.

Company Background

Capital Trust Limited, headquartered at 205 Centrum Mall, Sultanpur, M G Road, New Delhi-110030, is a financial services company. The firm's commitment to transparency is evident in its prompt disclosure of the proposed board meeting and potential rights issue.

Investors and stakeholders are advised to keep an eye on further announcements from the company regarding the outcome of the board meeting and any decisions made concerning the proposed rights issue.

Note: The final decision on the rights issue and its terms will be subject to board approval and market conditions at the time of the meeting.

Capital Trust Limited (CTL), a technology-driven NBFC focused on informal MSME lending in rural India, has reported a loss after tax of ₹8.3 crores for the first quarter. The company, which specializes in empowering shopkeepers and traders in semi-urban and rural areas, faced headwinds in a challenging market environment.

Financial Performance

The company's financial results for Q1 revealed several key metrics:

Market Challenges and Strategic Response

Capital Trust attributed the contraction in AUM and rise in NPA percentages to portfolio run-off and intentionally reduced disbursements. This strategic decision was made in response to prevailing stress in the microfinance institution (MFI) and deep rural market sectors.

Business Model and Market Presence

Despite the challenging quarter, Capital Trust continues to maintain a significant presence in the informal MSME lending space:

• Operates through 284 branches across 10 states
• Targets shopkeepers and traders with loans ranging from ₹50,000 to ₹10 lakhs
• Has historically disbursed over ₹4,500 crores to more than 12 lakh clients
• Maintains partnerships with 16 on-balance sheet funders and 5 co-lending partners

Unique Selling Proposition

Capital Trust positions itself as a pioneer in bridging the credit gap for informal MSMEs, particularly shopkeepers and traders who are often underserved by traditional financial institutions. The company employs a hybrid dual-credit model, combining digital intelligence with local expertise to assess creditworthiness and manage risk.

Looking Ahead

While the current quarter has been challenging, Capital Trust's established network and technology-driven approach position it to potentially benefit from the growing formalization of the informal MSME sector. The company's focus on digital processes, including 100% paperless onboarding and AI-based risk scoring, may help in scaling operations efficiently as market conditions improve.

As the rural and semi-urban economy continues to evolve, Capital Trust's role in providing structured, affordable credit to Bharat's entrepreneurs remains crucial. However, the company will need to navigate the ongoing market stresses carefully to return to profitability and growth in the coming quarters.