Report of Monitoring Agency on the utilization of proceeds raised through Qualified Institutions Placement ( QIP ) for quarter ended 31st March, 2025
BRIGADE · price
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CARE Ratings, the Monitoring Agency, has confirmed that Brigade Enterprises has utilized Rs. 1,068.72 crore (about 71%) of the Rs. 1,500 crore raised through a Qualified Institutions Placement (QIP) in September 2024, with no deviation from stated objects. The company has nearly fully used Rs. 447.75 crore out of Rs. 448 crore earmarked for repaying borrowings, and fully utilized Rs. 342.82 crore for general corporate purposes (GCP) and Rs. 32.18 crore for issue expenses. However, only Rs. 245.97 crore (about 36%) of the Rs. 677 crore allocated for land acquisition and joint development agreements has been deployed so far, leaving Rs. 431.03 crore unspent in that category. The remaining Rs. 431.28 crore of unutilized proceeds has been parked in fixed deposits with Axis Bank, SBI, HDFC Bank, and J&K Bank, earning 6.25%-7.50% interest. The Monitoring Agency flagged some co-mingling of funds since GCP and issue expense payments were partly routed through the company's overdraft account, relying on management certificates for verification.
Positive for shareholders as there are no deviations from the stated use of funds and unutilized money is earning healthy interest. However, the slow deployment on the land acquisition front (36% used) means a significant portion of growth capital is still sitting in deposits, which may temper near-term expansion benefits. Investors should expect further updates as the September 2025 deadline for completing the borrowing repayment and land-related objects approaches.