Atlanta Electricals Reports No Deviation in Rs. 400 Crore IPO Fund Utilization
Atlanta Electricals Limited has submitted its monitoring agency report for Q3 2023, showing adherence to IPO objectives. Out of the Rs. 400 crore raised, Rs. 59.37 crore has been used for working capital, while Rs. 340.63 crore remains unutilized in fixed deposits and monitoring accounts. The company provided explanations for the current utilization state, including plans for repayment of borrowings and future use of funds for general corporate purposes. CARE Ratings Limited confirmed no deviation from the stated objectives in the Offer Document.
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Atlanta Electricals Limited, a player in the power, distribution, and special application transformers sector, has submitted its monitoring agency report for the quarter ended September 30, revealing adherence to its stated Initial Public Offering (IPO) objectives.
IPO Fund Allocation and Utilization
The company's Rs. 400 crore public offering has seen its first quarter of fund utilization. According to the report, Atlanta Electricals has utilized Rs. 59.37 crore towards working capital requirements, while the remaining Rs. 340.63 crore remains unutilized and is currently parked in fixed deposits and monitoring accounts.
The breakdown of the IPO proceeds and their utilization is as follows:
| Objective | Amount Allocated (Rs. Crore) | Amount Utilized (Rs. Crore) | Unutilized Amount (Rs. Crore) |
|---|---|---|---|
| Repayment/prepayment of borrowings | 79.12 | 0.00 | 79.12 |
| Funding working capital requirements | 210.00 | 59.37 | 150.63 |
| General corporate purposes | 85.03 | 0.00 | 85.03 |
| Issue expenses | 25.85 | 0.00 | 25.85 |
| Total | 400.00 | 59.37 | 340.63 |
Fund Deployment Strategy
The company has provided reasons for the current state of fund utilization:
Repayment of Borrowings: The allocated amount of Rs. 79.12 crore was reportedly repaid in October, following the receipt of funds on the last day of the quarter (September 30).
Working Capital: Rs. 59.37 crore has been utilized for vendor payments. The remaining amount was reportedly parked in fixed deposits in October.
General Corporate Purposes: The allocated Rs. 85.03 crore was reportedly utilized in November, having been parked in fixed deposits until then.
Issue Expenses: The Rs. 25.85 crore remains in the Public Offer Account and will be claimed as payments are made.
Monitoring Agency's Comments
CARE Ratings Limited, the appointed Monitoring Agency, has confirmed that there is no deviation from the objects stated in the Offer Document. The agency noted that all expenses under the working capital head were towards vendor payments.
Compliance and Transparency
Atlanta Electricals' reporting and adherence to its stated objectives demonstrate its commitment to transparency and regulatory compliance. The company's deployment of funds, including the temporary parking of unutilized amounts in fixed deposits, suggests an approach to financial management.
As the company progresses with its fund utilization plan, investors and stakeholders may keep a watch on how these resources translate into operational growth and financial performance in the coming quarters.
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