Mumbai News

Bombay Dyeing approves Rs 940 crore rights issue draft; details here – Firstpost

Representational Image. Moneycontrol

Bombay Dyeing & Manufacturing Company’s rights issue committee reviewed and accepted the draft letter of offer for the estimated Rs 940 crore, the company announced in a BSE filing on Monday, 3 October. On 22 September, the company’s board of directors approved raising money through a rights issue of up to Rs 940 crore. The draft letter of the offer, dated 3 October 2022, will be submitted to the National Stock Exchange of India (NSE), Bombay Stock Exchange (BSE), and the Securities and Exchange Board of India (SEBI).

What is a rights issue?

When a company is seriously short on cash, it can utilise rights issues to obtain money. Companies provide shareholders with the option, but not the obligation, to purchase additional shares at a discount on the going market rate in these rights offers. An invitation to buy additional new shares of the company is extended to current shareholders through a rights issue. In this type of offering, existing shareholders are given rights-based securities.

The rights enable the shareholder to purchase more shares at a discount from market value at a predetermined time in the future. A rights offering is the most typical method used by businesses to raise additional funds.

Bombay Dyeing and Manufacturing Company’s net loss decreased from Rs 107.91 crore in the quarter ended 30 June 2021 to Rs 76.82 crore ending June 2022. During this quarter, the company’s net sales grew 59.21 percent year-on-year to Rs 606.37 crore.

On Monday, the BSE share price of Bombay Dyeing & Manufacturing Company closed lower by 0.31 percent at Rs 95.95. On Tuesday, the price of the company was trading 1.67 percent higher at Rs 97.55 at 3 pm.

In addition to other items, Bombay Dyeing manufactures home furnishings, towels, linens, children’s clothes, and leisure wear. It sells these products through more than 350 exclusive Bombay Dyeing store outlets and more than 2000 multi-brnd shops.

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