FIIs Bought Shares Via Preferential Issue In Vishal Fabrics; Announces Stellar Q1FY25 Results

On Monday, Vishal Fabrics Ltd saw its shares rise by 4.57% to Rs 33 per share, up from the previous closing price of Rs 31.56. The stock's 52-week high stands at Rs 34.75, while its 52-week low is Rs 14.28.

The Board of Directors has approved a plan to raise funds by issuing 5,00,00,000 compulsorily convertible equity warrants (Warrants) to non-promoter public investors on a preferential basis. Each Warrant, priced at Rs 30.60, can be converted into one equity share of Rs 5. This fundraising effort aims to collect approximately Rs 153 crore. The Warrants will be allocated to various investors, including Silver Stallion Limited (1,50,00,000 Warrants), Vikasa India EIF I Fund (1,00,00,000 Warrants), North Star Opportunities Fund VCC Bull Value Incorporated VCC Sub-Fund (75,00,000 Warrants), Eminence Global Fund PCC- Eubilia Capital Partners Fund I (75,00,000 Warrants), Nexpact Limited (50,00,000 Warrants), AG Dynamic Funds Limited (50,00,000 Warrants) These Warrants have an 18-month validity period and can be converted in one or more tranches. An initial payment of 25% of the Warrant price is required upon allotment, with the remaining 75% due upon conversion.

In addition to the Warrant issuance, the Board has also approved raising up to Rs 100 crore through a Qualified Institutions Placement (QIP) of equity shares with a face value of Rs 5 each. This QIP will be subject to shareholder and regulatory approvals. Following the potential conversion of Warrants and the completion of the QIP, the shareholding pattern is expected to change. Before the preferential issue, promoters held 69% of the shares, while the public held 31%.

Post-preferential issue and assuming full Warrant conversion, promoter shareholding would decrease to 55.07%, with public shareholding increasing to 44.93%.

Vishal Fabrics Ltd has a market capitalization of over Rs 600 crore. The stock has delivered multibagger returns, appreciating over 130% from its 52-week low of Rs 14.28 per share.

For the first quarter of FY25, Vishal Fabrics Ltd reported a 3.6% increase in total income to Rs 340.10 crore and a 106% rise in net profit to Rs 4.78 crore compared to Q1FY24. In its annual results for FY24, the company reported net sales of Rs 1,450 crore and a net profit of Rs 21 crore.

Established in 1985 and part of the Ahmedabad-based Chiripal Group, Vishal Fabrics Ltd is a prominent textile company. It manufactures and distributes a variety of fabrics, including dyed yarn, denim, and custom textiles. The company is recognized for its quality and sustainability certifications and specializes in dyeing, printing, and processing denim and other fabrics. Vishal Fabrics offers a range of compositions, including 100% cotton, cotton blends, and modal, and is a leading supplier of stretch denim. The company's focus on innovation includes diverse finishes, weaves, blends, and colors. With extensive production capacity from multiple facilities in Ahmedabad, Gujarat, Vishal Fabrics boasts an impressive clientele, including well-known international fashion brands.