Grasim Industries to raise Rs 4000 crore via rights issue; Stock up 1%

The board of Grasim Industries Limited has approved the raising of funds not exceeding Rs 4,000 crore by way of a rights issue to the eligible equity shareholders as on the record date. 

On Tuesday morning trade, shares of Grasim were trading at Rs 1992.95 per share higher by 1.06% on the BSE.

The proposed rights issuance by Grasim aims to fund the ongoing capital expenditure plan, repay existing borrowings, and support general corporate purposes, the company said on Monday.

Grasim has raised debt to part fund the on-going capital expenditure plan and the funds raised by this issue will also be largely used towards growth capex. The capital outlay for the Company to establish itself as India’s second largest decorative paints player is on track. 

Furthermore, the Company is committed to sustaining market leadership in its core businesses Viscose and Chemicals (at Standalone level). The rating agencies continue to reaffirm Grasim’s ‘AAA’ ratings.

In addition to this, the rights issue enables existing shareholders to participate in Grasim’s growth journey. The Promoters and Promoter Group have confirmed their participation. They will fully subscribe to their rights entitlement and also to the unsubscribed portion, if any, demonstrating their deep conviction in Grasim’s growth prospects, as per the regulatory filing.