As Reliance Infrastructure prepares for a key board meeting next week, industry insiders are buzzing with conjecture. What is Anil Ambani planning with the potential funding that could impact the company’s future?
On September 19, the board approved a preferred offer to fund Rs. 3,000 crore, which will be discussed at this session. The present regulatory filing suggests a comprehensive strategy that might include stock shares, warrants convertible into equity, and other novel financial instruments to boost the company’s capital.
The previous board meeting approved a preferential issue of about 12.56 crore equity shares, intending to raise Rs. 3,014 crore. Notably, this concern is directed at Risee Infinity Pvt Ltd, a promoter group entity, as well as other notable investors including Florintree Innovation LLP and Fortune Financial & Equities Services Pvt Ltd.
In its prospectus, Reliance Infrastructure stated that the revenues from this offering will directly assist corporate expansion and long-term working capital requirements. This approach is consistent with the government’s ambitious efforts, such as ‘Make In India’ and ‘Viksit Bharat,’ which aim to strengthen the country’s manufacturing capabilities.
The company’s present net value is around Rs. 9,000 crore, but a successful fundraising approach might increase it to Rs. 12,000 crore. The firm has a near-zero debt status, which puts it in a good position to invest in high-growth areas and strategic joint ventures.