Lokesh machines Limited announced significant corporate developments following its board meeting held on March 06, 2026. The board approved key proposals related to capital restructuring and fund raising initiatives, subject to shareholder approval through an upcoming Extraordinary General Meeting.

Authorized Share Capital Enhancement

The board has proposed a substantial increase in the company's authorized share capital structure. The enhancement will expand the capital base to accommodate future growth and funding requirements.

The proposed increase will require alteration of the capital clause in the company's Memorandum of Association to reflect the enhanced authorized share capital structure.

Preferential Allotment Details

The board approved the issuance of securities through preferential allotment, targeting both promoter and public categories of investors. The allotment comprises equity shares and convertible warrants at a predetermined price.

The issue price of Rs. 181.71 per share has been determined in accordance with Chapter V of SEBI (ICDR) Regulations, 2018. The preferential allotment includes participation from promoters, promoter group members, and public investors.

Investor Allocation Framework

The proposed allotment encompasses multiple investor categories with specific allocations for each participant. Promoter group members will receive warrant allocations, while public investors will participate through both equity shares and warrants.

Key Promoter Allocations:

• Mullapudi Srinivas: 8,37,000 warrants
• Mullapudi Sri Krishna: 9,57,000 warrants
• Kishore Babu Bollineni: 2,06,000 warrants

Notable Public Investor Participation:

• Ashok Atluri: 5,00,000 warrants
• Zenila Ventures LLP: 6,00,000 equity shares
• Multiple individual and institutional investors with varying allocations

Corporate Governance and Meeting Schedule

The board has scheduled an Extraordinary General Meeting for April 03, 2026, at 11:00 AM through video conferencing to seek shareholder approval for the proposed resolutions. March 27, 2026, has been designated as the cut-off date for remote e-voting purposes.

L.D. Reddy & Co. Practising Company Secretaries have been appointed as scrutinizers for the upcoming EGM. The board meeting commenced at 11:00 AM and concluded at 02:40 PM on March 06, 2026, with all proposals being duly considered and approved subject to shareholder consent.

Lokesh Machines Limited has disclosed receiving fine notices from both BSE and NSE for non-compliance with board composition regulations under SEBI LODR Regulations. The regulatory breach occurred during the quarter ended December 31, 2025, following the resignation of an independent director, leading to violations of Regulation 17(1) requirements.

Fine Details and Financial Impact

The stock exchanges have imposed penalties on the company for the regulatory non-compliance:

Board Meeting and Formal Response

The company's board of directors convened on March 06, 2026, to deliberate on the penalties imposed by both exchanges. The board formally acknowledged the temporary non-compliance with Regulation 17(1) of SEBI Listing Regulations and reviewed the circumstances leading to the regulatory breach.

Regulatory Constraints Under Arms Act

The board emphasized that as a manufacturer of small arms, Lokesh Machines Limited operates under stringent provisions of the Arms Act, 1959, and Arms Rules, 2016. The company faces mandatory regulatory requirements that contributed to the compliance delay:

• Prior approval from the Ministry of Home Affairs (MHA) is mandatory for any directorship changes
• Applications for new directors must be submitted 90 days in advance
• Security clearance proforma and self-declarations are required for all proposed directors
• Physical submission of applications to the Arms Section is mandatory

Waiver Application and Legal Justification

The board has formally advised management to submit waiver applications to both stock exchanges, emphasizing that the temporary non-compliance arose solely due to mandatory MHA approval requirements beyond the company's control. The applications have been filed in accordance with the Policy for Exemption of Fines levied under the SEBI SOP Circular.

Compliance Commitment and Transparency

The board has reiterated its commitment to maintaining high standards of corporate governance and compliance with all applicable regulatory requirements. The company has made comprehensive disclosures in compliance with Regulation 30 of SEBI LODR Regulations, with all relevant information available on the company's website at www.lokeshmachines.com .