Heranba Industries Limited has disclosed to stock exchanges that its wholly owned subsidiary faces insolvency proceedings following a payment dispute with a vendor. The company filed the mandatory disclosure under Regulation 30 of SEBI LODR, detailing the legal action initiated against Heranba Organics Private Limited (HOPL).

Insolvency Petition Details

Haresh Petrochem Private Limited has filed an insolvency application under Section 9 of the Insolvency and Bankruptcy Code, 2016, before the Hon'ble National Company Law Tribunal (NCLT) Mumbai. The petition seeks resolution of a payment dispute that has escalated to formal legal proceedings.

Financial Claims and Outstanding Amount

The dispute centers around a payment obligation totaling ₹1.70 crore that has been partially settled by HOPL. The company has made part payments toward the original claim, leaving a significant outstanding balance that prompted the insolvency petition.

Reason for Payment Delay

Heranba Industries has attributed the delay in settling the outstanding amount to quality issues identified in the goods or services supplied by Haresh Petrochem. According to the company's disclosure, HOPL is actively coordinating with the petitioner to resolve these quality-related concerns that led to the temporary withholding of the balance payment.

Expected Resolution and Impact

The company has expressed confidence in reaching an amicable settlement outside the NCLT proceedings. Heranba Industries expects that upon resolution of the quality issues, the remaining payment will be released and the matter will be settled without requiring formal adjudication.

Regarding the potential impact on the parent company, Heranba Industries has acknowledged that as HOPL is a 100% wholly owned subsidiary, the initiation of insolvency proceedings may have a material impact on the consolidated financial position, operations, or future prospects, depending on the outcome. However, the company has indicated that once the matter is settled, there will be no impact on Heranba Industries Limited.

Regulatory Compliance

The disclosure was made in accordance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with Schedule III. The company has committed to providing timely updates on further developments in this matter as required under SEBI LODR regulations.

Heranba Industries has announced its strategic expansion into the United Arab Emirates through the establishment of a fully owned subsidiary. The agro chemicals company plans to invest up to ₹2.00 crores initially in this new venture, marking a significant step in its international growth strategy.

Investment Details

The company's expansion plan involves setting up operations in the UAE market with a structured investment approach. The key parameters of this expansion are outlined below:

Strategic Expansion

The establishment of this UAE subsidiary represents Heranba Industries' commitment to expanding its footprint in international markets. The UAE serves as a strategic gateway for businesses looking to access Middle Eastern and North African markets, making it an attractive destination for the company's expansion plans.

The fact that no government approval is needed for this establishment streamlines the process and allows for faster implementation of the expansion strategy. This regulatory advantage enables the company to move forward with its plans without bureaucratic delays.

Market Positioning

As an agro chemicals company, Heranba Industries operates in a sector that has significant potential in the UAE market. The establishment of a local subsidiary will enable the company to better serve regional customers and potentially reduce operational costs through local presence.

The fully owned structure of the subsidiary ensures complete control over operations and strategic decisions, allowing Heranba Industries to maintain its operational standards and business practices in the new market.