Monitoring Agency Report for the 4th quarter and financial year ended March 31, 2025 - in relation to the Preferential issue of Equity shares and Fully Convertible warrants of Pakka Limited ( the Company )
PAKKA · price
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Pakka Limited has submitted the Q4 and FY25 Monitoring Agency Report from CARE Ratings covering its Rs. 244.80 crore preferential issue, which comprised 54 lakh equity shares (Rs. 146.88 crore) and 36 lakh fully convertible warrants (Rs. 97.92 crore) allotted to non-promoters in October 2024. As of March 31, 2025, Rs. 122.59 crore has been deployed — Rs. 97.79 crore toward the Jagriti Project plant and machinery and the full Rs. 24.80 crore toward repaying the cash credit facility under general corporate purposes. The investment in subsidiary (Rs. 30 crore) has not yet begun, and Rs. 48.77 crore remains unutilized, parked in fixed deposits with HDFC and Axis Bank earning 7.40%. CARE Ratings confirmed no deviation from the stated objects, but flagged that the company's share price is trading below the warrant exercise price of Rs. 204, which could lead warrant holders to let the instruments lapse.
Steady on-track deployment of funds is a neutral-to-positive sign for shareholders, but the risk of warrant holders not converting (since the stock trades below the Rs. 204 exercise price) could leave the planned Rs. 97.92 crore warrant tranche incomplete, potentially affecting future capex funding for the Jagriti Project.