JTL Industries In Focus As Board Plans Mega Capacity Expansion; Okays Fundraising

JTL Industries' shares were up 3.01% intraday on Tuesday, trading at Rs 248 a share. Following the company's announcement of its mega capacity expansion in Maharashtra and its proposal to raise funds through QIP and preferential shares, the stock commenced 2.96% higher on the NSE today at Rs 247.90.

To spend up to Rs. 1,200 crore in total in the company's wholly owned subsidiary JTL Tubes Limited in order to establish a mega project in the state of Maharashtra. This amount would be paid for in part by internal accruals and in part by the proceeds of the proposed issuance (preferential/QIP). JTL is setting off on a remarkable journey with the creation of a massive capacity augmentation project in Maharashtra through its fully-owned subsidiary JTL Tubes Limited.

JTL intends to raise Rs. 13,100 Mn through a variety of channels, including but not limited to qualified institutional placement (QIP), in order to fund this ambitious undertaking. The planning and execution of this financial influx will come from both promoter and non-promoter groups. The public, non-promoter group will play a crucial role with the contribution of Rs. 2,700 Mn, while the promoter and promoter group are committed to contributing Rs. 5,400 Mn of the total fundraisingThe remaining Rs. 5,000 Mn will be garnered through the QIP route, as per a regulatory filing.

Commenting on the development, the management team of JTL stated: "We are thrilled to announce our strategic decision to establish a mega capacity expansion project in Maharashtra through our subsidiary, JTL Tubes Limited, with a substantial capex outlay. This state-of-the-art facility will harness cutting-edge technology to enhance efficiency and diversify our product portfolio, underscoring our dedication to propelling the growth and advancement of our business.

This mega capacity expansion project is poised to redefine JTL's position in the Indian structural steel sector, serving as a catalyst for our emergence as a key player. We are confident that the combination of our industry expertise and the strategic location of the project will yield significant benefits for our stakeholders."

"To facilitate this mega project's execution, we are set to raise a total of Rs. 13,100 Mn through various means including Qualified Institutional Placement (QIP). A substantial portion of this capital, Rs. 5,400 Mn, will be contributed by the promoter and promoter group, with an additional Rs. 2,700 Mn from the public, non-promoter group.

The remaining Rs. 5,000 Mn will be sourced through QIP. This strategic financial initiative is designed to provide robust support, ensuring seamless execution and optimal resource utilization," the management stated.
"Throughout the project's lifecycle, we remain steadfast in our commitment to adhering to the highest standards of sustainability and environmental responsibility.

As we move forward, the entire team at JTL is excited about the opportunities and challenges that lie ahead. We are confident that the Mega Project in Maharashtra will not only contribute to our company's growth but also play a pivotal role in the economic development of the region," the management of JTL Industries further added.

The company is planning to accelerate growth further, by way of creating, issuing and alloting up to 2 Cr fully convertible warrants to the promoter and promoter group category and 1 Cr warrants to the non-promoter, public category, on preferential basis, at an issue price of Rs. 270/- per underlying equity share of the face value of Rs. 2/- each (including a premium of Rs. 268/- per equity Share), aggregating amount of up to Rs. 810 Cr.

The company has also announced issuing of securities by way of Qualified Institutions Placement (QIP) for aggregate amount not exceeding Rs. 500 Crores in one or more tranches, including Green Shoe option.