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Asian Granito India’s Rs 441 Cr Rights Issue opens for subscription



Rights issue of Asian Granito India Limited (AGL), one of the largest Luxury Surfaces and Bathware Solutions brands in the country, is open for subscription for its shareholders. The issue which opened on Monday, will close on May 10, 2022.

Company is raising Rs. 441 crores through the rights issue to fund its Mega Expansion Plans Value Added Luxury Surfaces & Bathware Segments including GVT Tiles, Sanitaryware and SPC Flooring etc.

Equity Shares under the Rights Issue are offered at a price of Rs 63 per Share i.e. 24% discount to the closing share price of Rs. 82.9 per share on 22 April 2022 on NSE.

Trading of the Rights Entitlements allotted to eligible shareholders is available on BSE and NSE between 25 April to 05 May (for online) and till 10 May (offline).

Asian Granito India will issue 99,93,682 fully paid-up equity shares of face value of Rs 10 each at a price of Rs 63 per equity share, aggregating Rs 440.96 crore on a rights basis to eligible equity shareholders. The shares will be issued in the ratio of 37:30 (37 equity shares for every 30 equity shares fully paid-up equity share held by the eligible equity shareholders). The company has fixed 12 April 2022 as record date for the purpose of determining the equity shareholders eligible to receive the rights entitlement in the rights issue.

The promoter & promoter group shareholders have confirmed their participation of up to 28.99% shareholding (i.e. upto 100% of their current shareholding) amounting to about Rs 128 crore. Promoter group also reserve the right to subscribe to part or the whole amount of the unsubscribed portion of the issue.

Proceeds of the Rights issue will be utilised to set up three new state-of-the-art manufacturing facilities at Morbi, Gujarat in Value Added Luxury Surfaces & Bathware Segments including GVT Tiles, Sanitaryware and SPC Flooring, setting up one of the India’s largest Display Centre, funding the working capital requirements of the above new projects and general corporate purposes.

Kamlesh Patel, CMD and Mukesh Patel, MD, Asian Granito India Ltd

Commenting on the development, Kamlesh Patel, Chairman and Managing Director, Asian Granito India Ltd said, “Morbi is India’s hub for Ceramic Tiles & Sanitaryware and accounts for more than 80% of the country’s total production, housing over 1,100 manufacturing units. AGL has lined up major expansion plans in Morbi region in the state of Gujarat, keeping in mind strategic locational advantages, proximity to the raw material sources, easy & quick availability of manpower, proximity to some of the country’s largest ports, among others. With commercialisation of the proposed plans, AGL is expected to strengthen its position as an Integrated Luxury Surfaces and Bathware Solutions Brand and up the Group’s margin profile in near to medium term.”

The Company has estimated that total working capital requirement for all the New Projects in the first year of commercial operations in 2023-24 will be around INR 80 crores, for which company is planning to utilise around INR 37 crores out of Rights Issue Proceeds.

The Company is also setting up one of the World’s largest display centre at India’s Ceramic Tiles hub – Morbi, Gujarat to showcase AGL Group’s entire product range under single roof i.e. Tiles, Sanitaryware,  Bathware, Quartz & Engineered Marble, SPC, etc. The five storey display centre is conceptualised in 1.5 lakh square feet of area and aims to showcase AGL Group’s production, technological excellence and best in class sourcing caliber at single place and is also expected to enhance Company’s brand and reach. Total estimated cost for setting up the Display Centre is around INR 40 crores. The Company currently exports to more than 100 countries and planning to expand to 120 plus countries. Company targets to increase its retail touch points to over 10,000, expand exclusive showrooms to over 500.

The Net Proceeds of the Rights Issue shall be used for the Proposed Projects. Additionally, the Company also proposes to deploy the proceeds of the Rights Issue to meet general corporate purposes including other strategic initiatives, debt reduction in group, brand building and strengthening, marketing activities, and ongoing general corporate exigencies.

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