The board of Lloyds Metals and Energy Ltd. has considered and approve raising funds worth up to ₹5,000 crore through a Qualified Institutional Placement (QIP), it said in an exchange filing.
A QIP is a fund raising method through which a company raising funds by issuing shares to eligible institutional bidders.
Lloyds Metals will raise these funds in one or more tranches, the statement said.
"The Board Members in their meeting have also discussed that fund raising should be done in an organic and the most efficient way taking into cognizance that the Promoter holding should not be diluted to a greater extent," the company statement said.
As of the December quarter, promoters of Lloyds Metals held a 65.7% stake in the company.
This fund raising exercise is subject to shareholding approval via a special resolution through a postal ballot with remote e-voting.
In an interaction with CNBC-TV18 at the sidelines of the World Economic Forum in Davos in January this year, Lloyds Metals Managing Director Rajesh Gupta said the company is aiming for forward integration from iron ore to steel.
Gupta pointed out that the company envisages steel production of 4.2 million tonnes from the two locations by 2027–28.
“We are doing a pipeline from the mine to the Gadchiroli as well as the Chandrapur plant, so that makes it greener as well as a cost-efficient scenario over the long term, which would make it India’s one of the longest pipelines.”
Shares of Lloyds Metals are trading 2.2% higher at ₹589.8. The stock has risen only 4% in the last 12 months.
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