Penny Stock Below Rs 5 In Green After Converting 13.50 Cr Warrants Into Shares

Today's rally for GG Engineering, a small-cap company in the industrial sector, was positive. Tuesday saw a better opening price for the shares on the BSE, opening at Rs 2.35 per share, up 4.91% from the previous close. The penny stock's rise in price followed the company's announcement that warrants would be converted into shares.

"Please refer to our communique dated December 14, 2023, w.r.t. to allotment of warrants, in terms of Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we wish to inform you that the Board of Directors of the Company in their meeting held today i.e. Monday, January 22, 2024, inter-alia, considered and approved the allotment of equity shares on conversion of 13,50,00,000 warrants into 13,50,00,000 equity shares at an issue price of Rs. 1.32/- each (including a premium of Rs. 0.32/- each), to "NonPromoters/Public Category", on preferential basis, upon receipt of balance amount aggregating to Rs. 13,36,50,000/- (Rupees Thirteen Crores and Thirty-Six Lakhs Fifty Thousand only) at the rate of Rs. 0.99 (Rupees Ninety Paise only) per warrant (being 75% of the issue price per warrant) from the allottees," said GG Engineering in a stock exchange filing.

"Pursuant to members approval, these warrants were issued, in terms of SEBI (ICDR) Regulations, 2018 to "Promoters and Promoter Group" and Non-Promoters/Public Category, on preferential basis, at an Issue Price of Rs. 1.32/- per warrant on payment of Rs. 0.33 (Thirty-three Paisa) per warrant, being 25% of the Issue Price, entitling the warrants holders to get their warrants converted into equal number of Equity Shares of the Company by paying remaining 75% i.e., Rs. 0.99/- within 18 months from the date of warrant allotment," said GG Engineering in a regulatory filing.

"Consequent to today's conversation of warrants/allotment of Equity Shares, the issued and paidup capital of the Company stands increased to Rs 116,94,98,800/-consisting of 116,94,98,800 equity shares of Re. 1/- each. The new equity shares so allotted, shall rank pari-passu with the existing equity shares of the Company. It may be please note that 46,00,00,000 total warrants are outstanding for conversion and these warrant holders are entitled to get their warrants converted into equal number of Equity Shares of the Company by paying remaining 75% i.e., Rs. 0.99/- per warrant within 18 months from the date of warrant allotment," the company further added.

G G Engineering Limited (BSE: 540614) was founded in 2006 and is a company that manufactures high-quality engineering and structural steel products.