Ajooni Biotech Rs 43.81 Cr Rights Issue Opens On 21 May

Ajooni Biotech, a pure veg and animal health care solutions company is schedule to open its Rs 43.81 crore rights issue on 21 May 2024. The funds raised through the issue will be utilised to finance expenditure towards acquisition of Land, site development and civil work, to acquire the plant and machinery; part finance the working capital requirement and corporate purposes.

Right issue of the company are offered at a price of Rs 5 per share - over 20 per cent discount to closing share price of Rs 6.5 per share on 18 May. Rights Issue will close on 31 May, 2024. Company promoter group is also participating in the rights issue.

The Company will issue 8,76,13,721 fully paid-up Equity Shares of the face value of Rs 2 each for cash at a price of Rs 5 per Equity Share aggregating to Rs 43.81 crore. The Rights entitlement ratio for the proposed issue is fixed at 1:1 (1 equity shares of face value of Rs 2 each for every 1 equity share held by the equity shareholders on the record date - 07 May). 

Company is planning to establish a new plant with an investment of Rs 16.50 crore at G.T. Road in Khanna, Punjab (adjacent to their existing plant) spanning 87,000 sq ft. The new unit will be entitled for incentives including 3 per cent interest Subvention, Capital subsidy of Rs 50 lakhs offered by Government of India, 100 per cent GST and 100 per cent stamp duty reimbursement among many others.

In the next two to three years the company projects its turnover to reach in the range of Rs 250-270 crore in FY 2026-27 and anticipates a PAT margin of 5 per cent of the turnover.

Jasjot Singh, Managing Director, Ajooni Biotech said, "We specialise in offering high-quality, pure veg cattle feed and pure veg supplements that cater to the dietary needs of cattle. We're now entering the B2C market, marking a significant expansion of our business scope. Proceeds of the issue will further strengthen the company's balance sheet and help fund its expansion plans and strategic growth initiatives."

CRISIL has raised the company's long-term credit facilities ratings to ‘CRISIL BB+/ Stable’. This upgrade underscored the company's ongoing efforts to improve risk profile, revenue streams, and operational profitability.