Penny Stock Under Rs 20: Gujarat-Based Textile Company Plans Rs 42.73 Crore Rights Issue at Rs 5 Per Share

The Indian equity markets traded marginally lower on Thursday, with the Nifty 50 index declining by 0.72 per cent to 24,004.20 during the session. Despite the weakness in benchmark indices, stock-specific action remained visible in select Penny Stocks. In this segment, Gujarat Cotex Ltd remained in focus after the company highlighted progress in its ongoing Rights Issue aimed at raising funds for expansion across hospitality, working capital and infrastructure projects. Following the development, Gujarat Cotex share price was trading at Rs 11.35 on Thursday.

Gujarat Cotex Rights Issue Details

Gujarat Cotex Ltd plans to raise Rs 42.73 crore through a Rights Issue, which opened for subscription on April 10, 2026 and will close on May 8, 2026. The company has fixed May 5, 2026 as the last date for on-market renunciation of Rights Entitlements.

The Rights Issue is priced at Rs 5 per share and comprises 8,54,64,000 fully paid-up equity shares aggregating to Rs 42.73 crore. The issue is being offered in the entitlement ratio of 6:1, which means eligible shareholders can subscribe to 6 rights equity shares for every 1 fully paid-up equity share held.

Planned Utilisation of Funds

Out of the total proceeds, Gujarat Cotex plans to utilise Rs 9.60 crore for completion of its upcoming premium hotel project near Sarangpur Hanuman Mandir, which will include 55 rooms and 10 dormitory accommodations.

Further, Rs 19.30 crore has been earmarked towards working capital requirements to support expansion across its diversified businesses. The company will also utilise Rs 2.13 crore for the purchase of a new registered office, while the remaining Rs 10.68 crore will be used for general corporate purposes and business scalability.

Strong 9MFY26 Financial Performance

For the nine months ended December 2025, Gujarat Cotex reported revenue from operations of Rs 29.86 crore as against Rs 19.30 crore in the corresponding period last year, registering a growth of 54.7 per cent YoY.

Net profit stood at Rs 0.83 crore in 9MFY26 compared to Rs 0.46 crore in 9MFY25, reflecting a growth of 79.7 per cent YoY.

About Gujarat Cotex

Gujarat Cotex Ltd is a diversified Small-Cap company operating across textile trading, Real Estate, hospitality and agro commodity trading businesses. Originally established as a textile manufacturer, the company has gradually expanded into multiple business verticals, including fabric trading, land transactions, packed pulses and hospitality infrastructure.

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