K G Denim Approves Rs 12.29 Crore Fund Raising, Reports Q1 Results
KG Denim's board approved two fund-raising initiatives totaling Rs 12.29 crore, including convertible warrants and preference shares issues. The company reported a Q1 consolidated net loss of Rs 325.00 lakhs, with total income at Rs 9,375.00 lakhs. KG Denim implemented an RBI restructuring package, faces dissent from some lenders, and is addressing NCLT claims from trade creditors.
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KG Denim , a prominent player in the textile industry, has announced significant financial decisions and released its first quarter results. The company's board of directors has approved two fund-raising initiatives totaling Rs 12.29 crore and disclosed its financial performance for the quarter ended June 30.
Fund Raising Initiatives
The board has given the green light to two major fund-raising proposals:
Convertible Warrants Issue: The company will issue 13,47,000 convertible warrants at Rs 17 per warrant to promoter Sri B. Sriramulu. This move is expected to raise Rs 2.29 crore. These warrants are convertible into equity shares within 18 months from the date of allotment.
Preference Shares Issue: The board has approved the issuance of 10,00,000 unlisted 6% Non-convertible Cumulative Redeemable Preference Shares (NCRPS) at Rs 100 each to promoters. This initiative will raise Rs 10.00 crore. The preference shares will be redeemable in three equal installments in the 6th, 7th, and 8th years from the allotment date.
Upon full conversion of the warrants, Sri B. Sriramulu's shareholding in the company would increase from the current 8.61% to 13.18% on a fully diluted basis.
Q1 Financial Results
KG Denim has also released its unaudited financial results for the quarter ended June 30:
| Particulars (Rs. in Lakhs) | Q1 | Q4 | Q1 (Previous Year) |
|---|---|---|---|
| Revenue from Operations | 9,300.00 | 15,240.00 | 9,921.00 |
| Total Income | 9,375.00 | 15,315.00 | 10,051.00 |
| Total Expenses | 10,134.00 | 14,554.00 | 10,420.00 |
| Profit/(Loss) before Tax | (445.00) | 1,339.00 | (352.00) |
| Net Profit/(Loss) | (325.00) | (988.00) | (261.00) |
The company reported a consolidated net loss of Rs 325.00 lakhs for Q1, compared to a net loss of Rs 261.00 lakhs in the same quarter of the previous year. The total income for the quarter stood at Rs 9,375.00 lakhs, showing a slight decrease from Rs 10,051.00 lakhs in Q1 of the previous year.
Other Key Developments
- The company's Annual General Meeting is scheduled for September 9, where shareholder approval will be sought for the fund-raising proposals.
- KG Denim has successfully implemented the RBI restructuring package as per Master Directions on natural calamities. However, South Indian Bank, one of the consortium lenders holding 7% and one NBFC to whom Rs 6.50 crore is outstanding as on date, have dissented from the restructuring scheme.
- The company has filed a writ petition before the Hon'ble High Court of Madras against any coercive action, which has given injunction orders.
- Some trade creditors have approached the National Company Law Tribunal (NCLT) for recovery of their dues, amounting to Rs 2,125.00 lakhs as of June 30. The company is actively negotiating with these creditors for amicable settlements.
KG Denim's strategic fund-raising initiatives, coupled with its efforts to manage financial challenges, demonstrate the company's proactive approach to strengthening its financial position and navigating through the current market conditions.
Historical Stock Returns for KG Denim
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| -2.78% | +0.33% | +16.46% | +10.76% | -21.98% | -6.78% |
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