Gujarat-based textile penny stock under Rs 40; Company allots 75,00,000 equity shares to North Star Opportunities Fund

Vishal Fabrics Limited, a prominent denim fabric manufacturer, today announced that the Board of Directors has approved the allotment of 75,00,000 equity shares with a face value of Rs 5 each to North Star Opportunities Fund-VCC Bull Value Incorporated VCC Sub-Fund. These shares were issued at Rs 30.60 per share upon the full conversion of warrants. The company received Rs 17,21,25,000 as the remaining 75 per cent of the issue price (Rs 22.95 per warrant), adhering to SEBI (ICDR) Regulations, 2018. This conversion stems from warrants initially allotted on a preferential basis with an upfront payment of 25 per cent (Rs. 7.65 per warrant).

This conversion has increased the company's issued and paid-up capital to Rs 112,55,50,015, comprising 22,51,10,003 equity shares of Rs. 5 each, which will rank equally with existing shares. It's also noted that 2,25,00,000 warrants remain outstanding, with holders retaining the right to convert them into equity shares by paying the remaining 75 per cent within 18 months from the initial allotment date.

Earlier, the company allotted 80,67,176 equity shares to the Mauritius-based Elysian Wealth Fund (formerly Silver Stallion Limited). These shares, with a face value of Rs 5, were issued at Rs 30.60 per share after the conversion of an equal number of warrants. The company received Rs 18,51,41,689.20 from Elysian Wealth Fund, which accounted for the remaining 75% of the issue price (Rs 22.95 per warrant

Vishal Fabrics Ltd., an Ahmedabad-based member of the Chiripal Group, stands as one of India's largest denim fabric manufacturers, boasting a capacity exceeding 100 million meters per annum. Renowned for its integrated value chain, cutting-edge infrastructure, and dedication to sustainability and quality, the company leverages a rich heritage in printing, dyeing, and fabric processing. Vishal Fabrics has solidified its leadership in producing wider-width fabrics and made significant inroads into large-scale denim production. A cornerstone of their operations is innovation and sustainability, with green practices embedded throughout their processes—from utilising sustainable raw materials to water recycling and maintaining zero-discharge facilities. This vision-led approach is driven by a core principle of delivering beyond expectations, merging global quality standards with purpose-driven practices.

For the full year FY25, total income increased by 5 per cent to Rs 1,521.43 crore, up from Rs 1,451.29 crore in FY24. Net profit for the year also saw healthy growth, rising to Rs 23.84 crore in FY25, a 13 per cent increase compared to Rs 21.13 crore posted in the previous year. The company attributes this growth to its focus on operational excellence, strategic growth, and strengthening its presence in both domestic and international markets through sustainable manufacturing innovation and digital transformation.

The company has a market cap of over Rs 750 crore. The stock is up 80 per cent from its 52-week low of Rs 21.05 per share. The company's promoters have a commanding 65.07 per cent ownership stake, while FIIs hold 8.72 per cent and public shareholders own 26.21 per cent.

Disclaimer: The article is for informational purposes only and not investment advice.