UPL to raise ₹3,378 crore via rights issue at ₹360 per share, record date is November 26

Agrochemicals major UPL Ltd on Wednesday (November 20) said it has approved the terms for its ₹3,377.74-crore rights issue, following a decision by the Rights Issue Committee during a meeting.

The offering includes 9,38,25,955 partly paid-up equity shares priced at ₹360 each, inclusive of a ₹358 premium per share upon full payment. Eligible shareholders can subscribe to one rights equity share for every eight fully paid-up equity shares held as of the record date, November 26, 2024.

The rights issue will open on December 5, 2024, and close on December 17, 2024. Shareholders can renounce their rights on-market between December 5 and December 11 or via off-market transfers before the issue closes.

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This move aligns with UPL’s previously-announced plan to raise up to ₹4,200 crore through equity issuance, as approved by its board in December 2023. The company reported a net loss of ₹443 crore for the September quarter, compared to a net loss of ₹189 crore that it had reported during the same quarter last year.

Revenue for the quarter increased by 9% to ₹11,090 crore, compared to ₹10,170 crore during the same period last year. Revenue growth for the quarter was driven by a 16% year-on-year (YoY) increase in volumes, a 7% decline in prices and near-flat forex rates.

Led by this volume growth, the company said it is on track to achieve its net debt and EBITDA guidance for the current financial year. Earnings before interest, tax, depreciation and amortisation (EBITDA) remained unchanged from the year-ago period at ₹1,576 crore, while the EBITDA margin narrowed to 14.2% from 15.5% last year.

Also Read: UPL Q2 Results: Stock falls as much as 8% after net loss widens from last year

Contribution margin for the quarter fell to 37.7% from 39.9% last year. UPL attributed the margin impact to overall pricing pressure in the crop protection segment.

UPL’s seeds business saw margin accretive growth this quarter, which was driven by favourable pricing in grain sorghum and corn. “The strategic investments we have made are expected to yield favourable results in the second half of the year,” the company said in a post-earnings statement.

On November 19, shares of UPL Ltd ended at ₹546.85, up by ₹10.35, or 1.93%, on the BSE.

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