Ucal Limited announced major corporate restructuring decisions following its board meeting on January 13, 2026. The board approved two significant transactions that will require shareholder consent through a postal ballot process, marking strategic moves in the company's operational structure.

Board Approvals for Strategic Transactions

The board considered and approved the dilution or reduction of shareholding in Ucal Holdings Inc, USA (UHI), a material subsidiary of the company. The proposed dilution could be up to 90% of the company's stake in UHI, potentially leading to cessation or modification of control over the US subsidiary.

The board also approved the sale of a residential plot owned by wholly-owned material subsidiary Ucal Polymer Industries Limited (UPIL). The transaction involves a 6.97-acre property being sold to promoter group company Sujo Land and Properties Private Limited.

Asset Sale Transaction Details

The residential plot sale represents a significant asset divestment for the subsidiary, with the transaction value capped at ₹45 crores on a cash basis at guideline value.

The subsidiary UPIL's financial contribution to the parent company shows total income of ₹45.28 crores representing 5.50% of consolidated income, and net worth of ₹56.43 crores representing 15.90% of consolidated net worth for the financial year ending March 31, 2025.

Regulatory Compliance and Approval Process

Both transactions require shareholder approval under SEBI Listing Obligations and Disclosure Requirements Regulations 2015. The board approved a draft postal ballot notice seeking consent through special resolution as per Section 110 of the Companies Act, 2013.

The asset sale transaction falls under related party transaction category since it involves the promoter group company as buyer. However, it does not breach the 10% threshold limit of annual consolidated turnover for material related party transactions under SEBI regulations. The company obtained prior approval from its Audit Committee and Board despite the parent company not being a direct party to the transaction.

Strategic Implications

The shareholding dilution in the US subsidiary aims to induct potential investors, potentially providing capital infusion and strategic partnerships for international operations. The residential plot sale by UPIL will generate cash proceeds for the subsidiary while involving a promoter group entity in the transaction structure.

Both transactions are subject to shareholder approval through the postal ballot process, with the company ensuring compliance with all applicable SEBI regulations and disclosure requirements. The completion of these transactions will depend on receiving requisite approvals and fulfilling regulatory conditions.

UCAL , a prominent automotive component manufacturer, has taken a significant step towards regulatory compliance by completing the filing of compounding applications with the Reserve Bank of India (RBI). These applications pertain to substantial write-offs made during the financial year ending March 31, 2018, involving its wholly owned subsidiary, Ucal Holdings Inc., USA.

Details of the Write-offs

The company has disclosed the following write-offs in its compounding applications:

Regulatory Compliance and Future Updates

Ucal Limited has stated that it will keep the stock exchanges informed about the progress of these applications. This move demonstrates the company's commitment to transparency and adherence to regulatory requirements.

Implications for Investors

The filing of these compounding applications marks an important development for Ucal Limited:

1. Regulatory Compliance: It shows the company's proactive approach in addressing past financial decisions with the appropriate regulatory body.
2. Financial Clarity: The applications provide clarity on significant write-offs, which could impact the company's financial statements.
3. Investor Transparency: By committing to update the stock exchanges, Ucal Limited is ensuring that investors remain informed about the status of these applications.

Investors and stakeholders will likely be keen to monitor the RBI's response to these applications and any potential financial or regulatory implications for Ucal Limited moving forward.