Shares of Atul Auto Ltd. surged more than 14% after the company approved a fundraising plan.
The company on Saturday approved a preferential issue of Rs 115 crore worth of warrants to non-promoters and promoters, including investor Vijay Kedia, according to an exchange filing.
The board has approved a proposal to issue up to 58,08,080 fully convertible warrants, each convertible into, at an option of proposed allottee, within 18 months from the date of allotment of warrants into fully paid up equity share of the company at Rs 198 apiece, the filing said.
About 50,50,505 warrants will be issued to Vijay Kedia for nearly Rs 100 crore, while 6,56,565 warrants will be issued to Khushbu Auto Pvt. (promoter) and 1,01,010 warrants to Jayantibhai Chandra (promoter).
Vijay Kedia already holds a 1.47% stake (3,21,512 shares) in the company as on June 30, 2022.
The stock surged over 14%—the most since April 21. The trading volume was nearly 32 times the 30-day average.
The Relative Strength Index was 77, suggesting the stock may be overbought.
All the four analysts tracking the company maintain a ‘buy’, according to Bloomberg data. The return potential of the stock is 4%.