Home / Companies / News /  Suzlon Energy 1,200 crore rights issue to open next month: 10 points

India's one of the top manufacturers of wind components, Suzlon Energy has announced a 'Rights Issue' aggregating to 1,200 crore. The issue will be launched on October 11, 2022. Under rights issue, fresh equity shares are offered by a company to those who are existing shareholders. Further, these existing shareholders get the right to buy fresh shares using their 'Rights Entitlement'. Generally, the rights issue is offered at a discounted price compared to the market price.

On BSE, Suzlon shares closed at 8.11 apiece down by 2.64%. The stock had touched an intraday high and low of 8.32 apiece and 7.97 apiece respectively.

The company's market cap is around 7,938.78 crore.

Here are 10 key points of the Suzlon rights issue

1. Under the 'Rights Issue', Suzlon will offer up to 240 crore partly paid-up Equity Shares amounting to 1,200 crore on a rights basis to its eligible shareholders.

2. The ratio of 'Rights Issue' is 5 rights equity shares for every 21 fully paid-up equity shares held by the eligible equity shareholders on the record date.

3. The issue is offered at 5 per Rights Equity share (including a premium of 3 per Rights Equity Share). This floor price is at a discount compared to the market price of 8.11 apiece on Wednesday.

4. The record date for the Rights Issue is October 4, 2022. Existing shareholders as on record date are offered a right to subscribe to the Rights Issue using their Rights Entitlement. The record date is the day for determining the shareholders to whom the Rights Issue will be made and who would be eligible to participate in the Rights Issue.

5. Thereby, Suzlon shares will turn ex-right on October 3. The ex-rights date simply means the day from which the company's shares trading on the market will not carry any benefit of rights issue for new investors in the respective shares. It is the date before the record date for rights issue. Also, in ex-rights, shareholders buying the shares after this day will not be eligible for rights issue.

6. Suzlon's last date for credit of Rights Entitlements (RE) is set on October 10, 2022. On the NSE website, it explains that Rights entitlements are offered to shareholders as a ratio to the number of securities held on this record date. A shareholder may refuse to subscribe to the rights issue and just let the 'right' lapse. Alternatively, the shareholder can renounce/trade the entitlement in favour of another person for a price.

7. Suzlon's rights issue will open on October 11. While the last date for on-market renunciation of RE is scheduled on October 14. The closing date for the rights issue is set on October 20, 2022.

8. Suzlon promoters and promoter group have confirmed their participation and they will be fully subscribing to the extent of their rights entitlement.

9. Suzlon plans to utilise the funds raised from the issue for repayment or pre-payment of a portion of certain outstanding borrowings availed by the Company and its subsidiaries and for general corporate purposes, subject to receipt of consent from our lenders.

10. Inga Ventures Private is the lead manager to Suzlon's 1,200 crore rights issue.

Suzlon is one of India’s top manufacturers in the wind component manufacturing segment as per capacity and is one of the top renewable O&M service providers in India, as per capacity serviced. 

With a footprint across 17 countries spread over six continents, Suzlon has the largest wind-installed base as a wind energy OEM with approximately 13.45 GW of installed capacity in India as of June 30, 2022, contributing to approximately 33% of India’s wind-installed base. Also, the company has an installed capacity of approximately 5.96 GW outside India, aggregating to a global installed capacity of approximately 19.41 GW globally as of June 30, 2022.

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