Upper Circuit & 52-Week High: Multibagger penny stock under Rs 10; Board allots 50,35,000 equity shares on conversion of warrants!

Sellwin Traders Ltd's Board of Directors has approved the allotment of 50,35,000 equity shares, each with a face value of Rs 2, following the conversion of an equal number of warrants. These warrants were initially allotted through a preferential issue. The conversion was triggered by the warrant holders exercising their right, having paid the balance amount of Rs 4.125 per equity share (which represents 75 per cent of the total consideration of Rs 5.50 per share). This allotment increases the company's Issued, Subscribed and Paid-up Equity Share Capital to Rs 45,98,45,000, comprising 22,99,22,500 fully paid-up equity shares. The newly allotted shares will rank pari passu with the existing equity shares of the company.

The conversion involves 8 identified allottees, including Dharmesh Bipinchandra Patel, Bipinchandra Nagindas Patel HUF, Montukumar Ganpatbhai Patel, Daxaben Bharatbhai Patel, Kiranbhai Jasubhai Mistry, Dharmesh Rajeshbhai Parmar, Prince Ghanshyambhai Parmar and Yatha Avinash Patel. Each warrant initially required an upfront payment of Rs. 1.375/- (25% of the total consideration). Warrant holders had 18 months from the allotment date to exercise their conversion rights; unexercised warrants would lapse and the initial payment would be forfeited. The issue price and the number of shares allotted upon conversion are subject to adjustments as per SEBI (ICDR) Regulations and other applicable laws.

Earlier, the company had signed a non-binding MoU with Mumbai-based Subhshri Overseas Ltd (Rs 250 crore turnover) to form a holding-subsidiary structure via a share swap. Sellwin Traders will acquire shares in Subhshri Overseas in exchange for its shares, with valuation by a third-party expert. Subhshri Overseas, founded in 1971, exports garments, textiles and imitation jewellery globally and is a "Star Export House."

The company recently underwent a 5-for-1 stock split, reducing the face value of each share from Rs 10 to Rs 2. Concurrently, the company declared a bonus issue of shares to existing shareholders in a 1:8 ratio, utilising available free reserves and the security premium account. The ex-date for both the stock split and bonus issue was Friday, November 1, 2024.

The company has a market cap of over Rs 150 crore. The debtor days have improved from 179 to 111 days. On Friday, shares of the company hit a 5 per cent upper circuit to Rs 6.76 per share from its previous closing. The stock made a new 52-week high of Rs 6.76 per share and has given multibagger returns of 149.5 per cent from its 52-week low of Rs 2.71 per share.

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