Zenith Fibres Limited, a leading manufacturer of Polypropylene Staple Fiber, has encountered a significant financial setback as its insurance claim for a failed windmill generator in Gujarat was rejected. The company, which had filed a claim for Rs 185.00 lakhs to cover the restoration costs of the generator, is now considering legal action to recover the incurred expenses.

Insurance Claim Rejection

The insurance company's decision to reject the claim came through a repudiation letter. This rejection follows a series of events that began with the initial notification of an estimated loss of Rs 200.00 lakhs to the insurer. Despite the completion of the inspection process by an appointed surveyor, Zenith Fibres was unable to realize any amount under the policy.

Windmill Restoration and Costs

The windmill, located at Vejalpar, Village Khakhrechi, Taluka Maniya-Miyana, District Morbi, Gujarat, experienced a temporary disruption in power generation. Zenith Fibres took swift action to restore operations, replacing the damaged generator with a new one. The restoration process allowed the windmill to resume power generation.

The actual cost incurred for the restoration amounted to Rs 185.00 lakhs, a significant expense that the company had initially expected to be covered by its insurance policy.

Impact on Operations

Despite the challenges posed by the generator failure, Zenith Fibres reported that its core business operations remained unaffected. The company's production of Polypropylene Staple Fiber continued without interruption during the windmill's downtime, demonstrating the resilience of its manufacturing processes.

Next Steps

In response to the insurance claim rejection, Zenith Fibres is taking proactive measures to protect its interests. The company has announced that it is in the process of seeking legal opinion to contest the rejection and recover the costs incurred for the generator's restoration and repair.

Dharati Bhavsar, Company Secretary of Zenith Fibres Limited, confirmed in a regulatory filing that the company is exploring legal avenues to address this matter and safeguard its rights.

Conclusion

The rejection of the insurance claim presents a financial challenge for Zenith Fibres Limited. As the company pursues legal options, stakeholders will be watching closely to see how this situation unfolds and its potential impact on the company's financial performance in the coming quarters.

Zenith Fibres Limited continues to operate its facilities, including the restored windmill in Gujarat, as it navigates this unexpected financial hurdle.

Zenith Fibres Limited, a leading manufacturer in the fibres industry, has announced the termination of Share Purchase Agreements with five buyers for the sale of equity shares in Rainy Properties Pvt Ltd. The termination, effective September 18, 2025, comes after the buyers failed to fulfill their obligations within the extended timeline provided by the company.

Background of the Transaction

In August 2024, Zenith Fibres had initially approved the sale of 360,000 equity shares of Rainy Properties for a total consideration of Rs. 5,400,000.00. The company had entered into agreements with ten potential buyers for this transaction.

Partial Completion and Extended Timeline

As per the company's earlier intimation dated October 7, 2024, transactions with five of the buyers were successfully completed. The remaining five buyers requested additional time to complete their respective transactions, which was granted by Zenith Fibres.

Termination of Agreements

Despite the extended timeline, the five remaining buyers failed to fulfill their obligations or complete the transactions. Consequently, Zenith Fibres was compelled to terminate the respective Share Purchase Agreements dated August 10, 2024. The termination was executed through letters issued on September 18, 2025.

Official Notification

In compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, Zenith Fibres Limited has officially notified the BSE Limited about this development. The company secretary, Dharati Bhavsar, confirmed that the Share Purchase Agreements now stand terminated in their entirety, effective September 18, 2025.

Impact on Zenith Fibres

While the termination of these agreements may affect the planned divestment of Rainy Properties shares, Zenith Fibres has not provided any information on how this development might impact its financial position or future strategies regarding the stake in Rainy Properties Pvt Ltd.

Investors and stakeholders of Zenith Fibres Limited are advised to monitor further announcements from the company for any updates on this matter or potential alternative arrangements for the sale of the remaining Rainy Properties shares.