Andhra Cements Files Draft Papers To Raise Rs 180 Crore

The promoters and management of Andhra Cements Limited have undergone multiple changes since its incorporation on December 9, 1936, under the Indian Companies Act 1913. Following its 1994 acquisition from BIFR, the business was formerly managed by M/s Duncan Agro Industries Ltd., also known as Duncan Industries Ltd. (DIL), which was overseen by Shri G.P. Goenka (Duncan Goenka Group). The company’s former promoters, M/s Bennett Coleman Co. Ltd. (BDCL), initiated this management change. In February of the same year, 2012, the Jaypee Group took over management control after acquiring about 60% of the company. The company’s financial creditors filed an IBC insolvency petition with NCLT in April 2022. According to the order issued by the Hon’ble NCLT, Amaravati Bench on February 16, 2023, SAGAR CEMENTS LIMITED (SCL) has finally had its resolution plan approved. SCL invested Rs. 322.25 crore to buy 95% of the company’s shares (post-capital reduction) in compliance with the approved resolution plan. In March 2023, SCL assumed management control of the company as a result. At the moment, ANDHRA CEMENTS LIMITED is a part of the “Sagar Group” and a subsidiary of SAGAR CEMENTS LIMITED. Two of Andhra Cements Limited’s manufacturing facilities are located in Visakhapatnam (AP) and Durga Cement Works (DCW) Dachepalli, Palnadu District (AP). The primary clinker plant of the company was located in Dachepalli, Palnadu District (AP), at Durgapuram. On the National Highway that connects Hyderabad and Chennai, this plant is located 180 kilometers from Hyderabad. Two cement grinding machines are present in this plant, which produces cement that is both PPC and OPC grade. We will be able to produce high-quality clinker and cement on this line thanks to the abundance of limestone available in the mines.

Andhra Cements Ltd. is raising the Rs. 180 crore fund via rights issue:

The Securities and Exchange Board of India received draft documents from Andhra Cements Ltd., a subsidiary of Sagar Cements Ltd., on Monday in an attempt to raise up to Rs 180 crore through a rights issue. To get the necessary approvals, the draft document has also been submitted to the National Stock Exchange and the BSE.

The draft letter of offer for the planned issuance of equity shares of the company by way of rights issue to the eligible equity shareholders for an amount aggregating up to Rs 180 crore was approved, according to the company’s rights issuing committee. The company’s board of directors approved the fundraising plan at a meeting on March 28. Subsequently, the board approved an additional proposal to raise up to Rs 250 crore through debt issuance.

The business performance of Andhra Cements Ltd:

Andhra Cements reported a net loss of Rs 23.6 crore for the quarter that ended in June, down from a net loss of Rs 24.6 crore for the same period last year. In comparison to the same quarter last year, the operations revenue climbed to Rs 63.3 crore from Rs 13.2 crore. The stock has dropped 11.5% over the last 12 months and 20.8% over the past 12 months.

Andhra Cements Ltd. stock is 10% up today:

The share price of Andhra Cements Ltd. is currently Rs. 94.80, up 10% intraday today. It reaches the upper circuit of the current day.

Conclusion: Andhra Cements Ltd. is utilizing the right issue to raise capital to provide its existing shareholders with a discounted price on their current holdings.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.