Outcome of meeting of the Board of Directors of Swadeshi Industries & Leasing Limited held on Thursday, April 17, 2025
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The board of Swadeshi Industries & Leasing Ltd, held on April 17, 2025, approved increasing the company's authorised share capital from Rs. 12.5 crore to Rs. 25 crore, doubling the existing capital base. The board also approved issuing up to 1,23,10,000 convertible warrants of Rs. 10 each on a preferential basis to 48 allottees, comprising promoter/promoter group and non-promoter categories. Each warrant is convertible into one equity share of Rs. 10 at par, with a 25% upfront payment and the balance 75% payable at the time of conversion. The warrants have an 18-month conversion window from the date of allotment. Additionally, shareholder approval will be sought for taking loans from directors and promoters with an option to convert into equity. An EGM is scheduled for May 15, 2025 to seek member approval for these proposals.
The preferential warrant issue at par (Rs. 10) to promoter-related parties and select investors will lead to significant equity dilution once converted, potentially increasing the promoter holding. Existing shareholders may see their stake reduced once the warrants are exercised within the 18-month window. The issue is subject to shareholder approval at the upcoming EGM.