The company would be using the funds for expanding manufacturing facilities and product development
Telecom equipment maker HFCL has raised Rs 600 crore through the QIP (qualified institutional placement) issue. Reliance Ventures, Quant Mutual Fund, IIFL Wealth, Elara India, Discovery, Segantii, Millennium were among the various investors in the QIP.
The company plans to use the QIP proceeds towards the funding of capital expenditure requirements for setting up new manufacturing facilities, capacity expansions, R&D and product development, HFCL Managing Director Mahendra Nahata informed.
“With the capacity expansion, the company would reap rich dividends in the form of revenue, market share and profitability gains.
HFCL has also applied for the production linked incentive scheme for telecom networking equipment, where the government is offering up to 20 times higher incentives based on investment and incremental production criteria.
“The PLI scheme announced by the Government, creation of 5G network, expansion of BharatNet Programme, rapidly growing fibre to the home segment and additional spectrum allocation to the telcos are set to amplify our opportunity spectrum,” Nahata said.
The capital expansion will also help in building a new plant for manufacturing products for supplies to the defence sector under Atmanirbhar Bharat and Make in India initiatives, and enable the company to capture opportunities in the segment, he added.
The proposal to raise funds was approved by the company’s board on September 03, 2021. The fundraising committee of the Board of Directors decided to raise funds through QIP, and the issue was opened on December 06, 2021, and closed on December 09, 2021.
The fundraising committee of directors at its meeting on December 10, 2021, approved the issue and allotment of 8,72,72,727 equity shares of Re 1 each to 21 qualified institutional buyers at the issue price of Rs 68.75 per equity share (including a premium of Rs 67.75 per Equity Share), aggregating to Rs 600 crore.
HFCL recently announced the appointment of two industry veterans in its two recently incorporated wholly-owned subsidiaries in the USA and Netherlands to bolster its international presence and unleash non-linear growth for the company in the global markets.