Aditya Birla Group to invest Rs 1,250 crore into its financial services subsidiary

2 Jun 2023 , 10:22 AM

The Aditya Birla Group plans to invest Rs 1,250 crore in Aditya Birla Capital Ltd., which provides financial services. According to a statement on Thursday, the board of Aditya Birla Capital Ltd. (ABCL), which engages in lending, asset management, and insurance, approved a preferential issue of Rs 1,250 crore to its promoter and promoter group company.

In a recent press release, ABCL stated its intention to raise Rs 3,000 crore, and its managing director, Vishakha Mulye, assured reporters that any company in need of funding would receive funding to support its expansion.

According to ABCL, the preferential issuance would take place at a cost of Rs 165.1 per equity share and is pending approval from shareholders.

On the BSE, the company’s shares ended the day Thursday 0.91% higher at Rs 171.70 per share.

According to the announcement, the group’s largest company, Grasim Industries, would contribute Rs 1,000 crore as well. Surya Kiran Investments, another group company, will contribute Rs 250 crore.

The money obtained will go towards increasing the capital base, enhancing the solvency margin and leverage ratio, and covering the costs associated with funding expansion.

Additionally, they will be used by one or more of ABCL’s subsidiaries, affiliates, or joint ventures that are involved in specific technological, business, and service platforms.

On June 24, ABCL will hold an extraordinary general meeting to vote on whether to approve a proposal to raise up to Rs 3,000 crore in total.

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