The board of directors of Indian Hotels Company Limited (IHCL) has approved plans to raise ₹3,000 crore via rights issue. The funds will be used to meet the company’s financing needs of capex, growth plans and debt repayment.

“The board of directors of the company, at its meeting held today, has, inter alia, considered and approved, subject to receipt of relevant approvals from regulatory authorities, as may be required, issue of equity shares by way of a rights issue to the existing shareholders of the company on a record date for an amount not exceeding ₹3,000 crore,” it said. Earlier this month, the board had also approved raising of ₹250 crore.

The board has also approved the formation of a ‘Committee of Directors’ for the said rights issue. It will decide on the terms and conditions of the issue, including the rights entitlement ratio, the issue price, record date, timing and other related matters

“The objective of the aforementioned issue inter-alia is to meet the company’s financing needs for capital expenditure, growth plans and debt repayment and will be finalised in consultation with the merchant bankers,” it further added.

For Q1 of FY22, IHCL reported a net loss of ₹301 crore compared to a net loss of ₹312 crore in the same period last fiscal. Its revenue from operations doubled to ₹345 crore for the quarter ended June 30, compared to ₹143 crore in the same period last year.

“The management has secured additional financing for the next 12 months to prevent disruption of the operating cash flows and to enable the company meet its debts and obligations as they fall due,” the company said while announcing its quarter results.