Kotak Special Situations Fund invests ₹550 Cr via NCDs in this cement company


Announcing today that it has committed 550 crore to Sanghi Industries Group in the form of non-convertible debentures (NCDs), Kotak Special Situations Fund (KSSF), administered by Kotak Investment Advisors Limited (KIAL), made the announcement. From the total, KSSF invested 500 crore in the NCDs of Sanghi Industries Limited (SIL) and 50 crore in the NCDs of a company run by SIL’s promoters, which would then be infused in SIL.

The timely infusion of KSSF will improve operations, and the company’s liquidity profile, and restore SIL’s capital base. KSSF will make investments out of a fund worth $1 billion. With this investment, KSSF has invested more than 6,300 crore and completed 13 agreements.

Eshwar Karra, CEO-Kotak Special Situations Fund at Kotak Investment Advisors Limited said, “SILs performance has been under pressure owing to high energy costs. This was further exacerbated by the upcoming debt repayments availed for the expansion capex. KSSF’s infusion terms out the debt and should correct the capital structure. It also underlines how KSSF, through its experience and expertise, has structured a solution that addresses SIL’s specific financial requirements.”

The Ravi Sanghi Group’s flagship organisation Sanghi Industries Limited (SIL) is involved in the production and marketing of cement under the brand name “Sanghi Cement”. The company is one of India’s well-known cement makers and has a significant presence in Gujarat.

The Board of Directors of SIL also informed stock exchanges today by saying that “We would like to inform you that at the meeting of the Business Operations and Finance Committee of the Board of Directors of the Company held today i.e. on Tuesday, 29th November, 2022, the Business Operations and Finance Committee of the Board of Directors of the Company has inter alia approved the allotment of 5000 (Five Thousand) Secured, Unrated, Unlisted, Redeemable, Non-Convertible Debentures (NCDs) totally aggregating to Rs. 500,00,00,000/- (Rupees Five Hundred Crores Only) having face value of Rs. 10,00,000/- (Rupees Ten Lakh Only) each on Private Placement basis, to the applicant.”

The date of allotment is 29th November, 2022 while the closing date of this NCD will be 28th November, 2025. The debenture comes with a tenure of 36 months with a coupon rate of 12% per annum to be paid on monthly basis.

The shares of Sanghi Industries Ltd closed today at 66.70 apiece, up by 0.68% from the previous close of 66.25. On a YTD basis, the stock has rallied 16.30% so far in 2022.

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