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IEL Limited has announced a rights issue to raise INR 44.56 crores through the issuance of 10,01,28,990 fully paid-up equity shares, priced at INR 4.45 each. The initiative supports the company's expansion into warehousing and logistics, with 29,800 square meters of land acquired in Lucknow to build advanced storage facilities, including smart warehouses and cold storage units, catering to sectors like retail and pharmaceuticals. Despite a 56.16% rise in FY24 net sales to INR 17.26 crore, net profit declined to INR 0.26 crore. The move aims to enhance shareholder value and leverage market growth for logistics and warehousing solutions.
IEL Limited, a leading name in the chemical, dye, pigment, and commodity trading sectors, has announced a rights issue comprising up to 10,01,28,990 fully paid-up equity shares to raise an amount not exceeding INR 44.56 crores. This rights issue, scheduled to open on February 4, 2025, and close on February 21, 2025, marks a pivotal step in the company's strategic expansion into the fast-growing warehousing and logistics industry. The rights issue offers equity shares with a face value of INR 1 each at a price of INR 4.45 per share, which includes a premium of INR 3.45. Advertisement
IEL will use the funds raised to acquire land, develop modern storage facilities, cover general corporate expenses, and address rights issue-related costs. This strategic pricing aims to attract shareholders and align with the company's long-term growth objectives. As part of its expansion plans, IEL has acquired 29,800 square meters of land in Lucknow, where it will construct advanced storage facilities, including warehouses, cold storage units, silos, and smart warehouses equipped with cutting-edge technology. These facilities will cater to the growing demand for efficient storage solutions across sectors such as retail, food, and pharmaceuticals.
Ajay Gupta, Managing Director of IEL Limited, highlighted India's warehousing market's significant growth potential, projecting it to reach USD 34.99 billion by 2027. He highlighted the importance of the rights issue in financing the company's ambitious plans to establish a strong presence in the warehousing and logistics sector. IEL will allocate the funds to acquire land and build infrastructure to meet the growing demand across India. The company's focus includes high-demand regions, advanced cold storage facilities, and smart warehouses aimed at enhancing operational efficiency. This expansion will strengthen the company's position in logistics, deliver substantial shareholder value, and tap into the rapidly growing market.
Financially, IEL reported a 56.16% increase in net sales, reaching INR 17.26 crore in FY24, up from INR 11.05 crore in FY23. However, the annual net profit declined to INR 0.26 crore in FY24 from INR 2.37 crore in FY23. During FY23-24, the company also completed a stock split, reducing the face value of its equity shares from INR 10 to INR 1, effective September 25, 2023.
This rights issue signals IEL's commitment to diversification and growth, positioning the company to leverage the burgeoning demand for logistics and warehousing solutions while driving value for stakeholders.
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