UGRO Capital , a prominent player in the financial services sector, has made significant strides in its expansion plans and financial structuring. The company recently announced two major developments that are set to shape its future trajectory.

RBI Approval for Profectus Capital Acquisition

UGRO Capital has received a crucial green light from the Reserve Bank of India (RBI) for its proposed acquisition of Profectus Capital Private Limited. The RBI granted this approval through a letter dated September 17, following an application filed by Profectus seeking prior approval for the acquisition transaction.

The acquisition, which involves UGRO Capital obtaining 100% shareholding in Profectus Capital, is now expected to close by October 31, subject to customary conditions outlined in the share purchase agreement. This strategic move aligns with UGRO Capital's growth objectives and is poised to strengthen its market position.

Modification in Compulsorily Convertible Debentures (CCDs) Terms

In a related development, UGRO Capital's Securities Allotment and Transfer Committee (SATC) has approved a variation in the terms of Compulsorily Convertible Debentures (CCDs) to be issued on a preferential basis. These CCDs are intended to fund the acquisition of Profectus Capital.

The key modification pertains to the coupon payment structure of the CCDs. Initially, as disclosed in the Postal Ballot Notice dated June 20, the coupon was proposed to be paid in two parts. However, the SATC has now approved that the entire coupon will be paid immediately post-allotment of the CCDs, removing any linkage to subsequent events.

It's important to note that all other terms and conditions of the CCDs remain unchanged. This adjustment in the payment structure demonstrates UGRO Capital's commitment to optimizing its financial instruments while proceeding with its acquisition plans.

Commercial Paper Allotment

In addition to these strategic moves, UGRO Capital's Investment and Borrowing Committee approved the allotment of Commercial Papers (CPs) on September 17. The details of the CP allotment are as follows:

This CP issuance further underscores UGRO Capital's active management of its short-term financial instruments and liquidity position.

These developments collectively highlight UGRO Capital's proactive approach to corporate strategy, financial management, and regulatory compliance. As the company moves forward with its acquisition plans and financial structuring, stakeholders will be keenly watching how these initiatives translate into operational and financial performance in the coming months.

UGRO Capital , a non-banking finance company (NBFC), has taken significant steps to strengthen its capital base and manage its short-term funding needs. The company's Investment and Borrowing Committee has approved the issuance of Non-Convertible Debentures (NCDs) worth INR 50.00 crore through private placement, aimed at enhancing its Tier II capital. Additionally, the company has allotted Commercial Papers worth Rs 9.78 crore.

Key Details of the NCD Issuance

Commercial Paper Allotment

UGRO Capital has also allotted Commercial Papers worth Rs 9.78 crore. The key details of this allotment are:

• Face Value: Rs 5.00 lakh per security
• Issue Price: Rs 4,89,146.50 per security
• Tenure: 91 days
• Redemption Value: Rs 10.00 crore
• Issue and Paying Agent: Yes Bank Limited, Mumbai
• ISIN: INE583D14675

The Commercial Papers are proposed to be listed.

Purpose and Implications

The primary objective of the NCD issuance is to raise subordinated debt as Tier II capital. This move is strategically aligned with the Reserve Bank of India's (RBI) regulations for NBFCs, specifically the Master Direction – Reserve Bank of India (Non-Banking Financial Company – Scale Based Regulation) Directions, 2023. By bolstering its Tier II capital, UGRO Capital aims to enhance its overall capital adequacy ratio, a crucial metric for financial institutions.

The Commercial Paper allotment, on the other hand, addresses the company's short-term funding requirements, providing flexibility in managing its working capital needs.

Investor Meeting Announcement

UGRO Capital has also announced an upcoming virtual group meeting with analysts and investors. The meeting is scheduled as part of the Arihant Bharat Connect Conference: Rising Stars. This interaction provides an opportunity for the company to engage with the investment community and potentially discuss its recent capital-raising initiatives.

Company Background

UGRO Capital Limited, headquartered in Mumbai, operates as a non-banking finance company. The company's strategic focus on capital adequacy improvement through the NCD issuance and efficient short-term funding management via Commercial Papers reflects its commitment to maintaining a strong financial position in the competitive NBFC sector.

As the financial landscape continues to evolve, UGRO Capital's proactive approach to capital management demonstrates its dedication to meeting regulatory requirements and positioning itself for sustainable growth in the Indian financial services market.