Telecom gear manufacturer HFCL raises Rs 600 crore through QIP issue

Telecom gear maker HFCL Limited (HFCL), has raised Rs 600 crore through a QIP issue. The QIP has shown an overwhelming response from institutional investors like Reliance Ventures, Quant Mutual Fund, IIFL Wealth, Elara India, Discovery, Segantii, Millennium amongst others who participated in the fund raise programme of the company.

The QIP proceeds shall be predominantly utilised towards funding of capital expenditure requirements for setting up of new manufacturing facilities, capacity expansions and expenditure on R&D and product development.

The company is one of the eligible players which has received permission under the production linked incentive scheme for telecom products. Apart from its fibre business the company is also developing various 5G products which include radios amongst others.

The board of directors of the company at its meeting held on September 3, 2021, had passed an enabling resolution to raise funds by way of private placement or preferential issue or public issue or rights issue or qualified institutional placement or through any other permissible mode and/or combination thereof, which was also approved by the shareholders in their 34th annual general meeting held on September 30, 2021.

The Fund Raising Committee of the Board of Directors had approved the issue and allotment of 87,272,727 equity shares of Re 1 each to 21 qualified institutional buyers at the issue price of Rs 68.75 per equity sShare (including a premium of Rs 67.75 per equity share), aggregating to Rs 600 crore. The trading of the newly allotted equity shares will commence from today i.e. December 14, 2021 at the National Stock Exchange of India Limited and BSE Limited.

Commenting on  closure of the QIP issue, Mahendra Nahata, managing director, HFCL said, “HFCL has successfully raised Rs 600 crores via QIP. This capital raise will help in accelerating Company’s plan for setting up of new manufacturing facilities, capacity expansions, R&D initiatives and new product development."