Monitoring Agency Report for the quarter ended March 31, 2025.
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Divgi Torqtransfer Systems has filed the quarterly monitoring agency report from ICRA Limited covering IPO funds raised in March 2023. The IPO raised Rs. 412.12 crore in total, with fresh issue net proceeds of Rs. 169.66 crore (slightly higher than the originally planned Rs. 168.43 crore due to lower issue expenses). Out of Rs. 169.66 crore, the company has used Rs. 64.34 crore so far, with Rs. 105.32 crore still unutilized. The bulk of spending — Rs. 45.50 crore — has gone toward buying manufacturing equipment and machinery out of the Rs. 150.71 crore earmarked for capex, while Rs. 18.83 crore of the Rs. 18.95 crore general corporate purpose fund has been deployed. The unutilized Rs. 117 crore is parked in fixed deposits with SBI, HDFC and Axis Bank earning 6.6–7.75% interest. The monitoring agency confirmed no deviation from the stated objects of the issue.
Shareholders should note a significant delay of 3–12 months in the capex project due to supplier lead times and extended negotiations; only Rs. 9.38 crore of the Rs. 114.59 crore planned for FY25 was actually spent, with the balance pushed to FY26. While the idle funds are earning reasonable interest in bank deposits, the slow deployment of IPO money on its stated purpose is a mild negative signal on execution speed.