QIP issue: Titagarh Wagons sets floor price at ₹104.64/share

Titagarh Wagons said on Thursday that it plans to raise funds up to ₹250 crore through qualified institutional placement of equities.

The company, in a filing to the stock exchanges, said a panel of its board of directors on Wednesday took on record the relevant date for the QIP as July 8 and the floor price as ₹104.64 an equity share of face value ₹2 each. It, however, did not specify the amount it will mop up.

Proportional adjustments According to merchant banking sources, Titagarh Wagons is raising ₹150 crore. The paid-up equity component of the placement would be maximum of ₹28.65 crore. The rest of the funds raised would go to the premium reserves account. If the QIP fetches a better price than the floor price, the equity component would be lower proportionately.

“The placements have been so designed as to keep the majority holding of the existing promoters,” a merchant banking official said on condition of anonymity.

The existing promoters hold around 53.05 per cent of the total paid-up capital of ₹20.06 crore. Though the promoters’ holding would come down in the expanded capital, they would continue to hold majority stake, sources insisted.

Currently, among the non-promoter category of shareholders, GE Capital International (Mauritius) holds 12.26 per cent in Titagarh Wagons. The combined holding of Reliance Capital Trustee Co, HDFC Trustee Co and Max Life Insurance Co is around 10 per cent.

The fund raising was earlier approved by the shareholders through postal ballot. The company has filed the preliminary placement document with the BSE and NSE.

In the recent months, the company and its subsidiaries have taken several steps to expand its business within and outside its primary domain of wagon manufacturing. These moves would however, require funds infusion. The newer areas are manufacturing of wagon components, tractors and defence equipment.