Monitoring Agency Report in respect of utilization of funds raised through preferential issue of share warrants for the quarter ended 31st March, 2025.
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Acuité Ratings and Research has submitted its monitoring agency report on the use of proceeds from RDB Infrastructure's preferential issue of share warrants (issue size INR 277.93 Crore, conducted November 13-27, 2024). As of March 31, 2025, the company had received INR 101.49 Crore of the total proceeds and utilized INR 93.46 Crore, with INR 8.03 Crore remaining unutilized. Funds have been deployed towards debt repayment (INR 33.56 Crore), purchase of land (INR 43.00 Crore), investment in infrastructure securities (INR 0.93 Crore), and working capital needs (INR 15.97 Crore). The monitoring agency confirmed there is no deviation from the stated objects of the issue. Unutilized funds of INR 8 Crore have been parked as unsecured loans to two private entities (Sharda & Sons Baking House and Axisline Financial Consultants) earning 18% interest, maturing September 2025.
Clean report with no deviations is a positive signal, confirming the company is using warrants proceeds as disclosed. However, parking INR 8 Crore of unutilized funds as unsecured loans to unrelated private parties (rather than in scheduled bank deposits) is a mild governance concern for shareholders, though the 18% return is attractive. Dilution risk remains since warrants are still partly unexercised.