Visagar Polytex to raise funds through rights issue

Visagar Polytex today said that it will raise funds through rights issue of equity shares which will be used to enter into unorganised women wear retail business and expanding their presence.

The rights issue will be in the ratio of five shares for every one share of the company and go ahead with the right issue procedure at Rs 15 per share, a premium of Rs 5 on its share value, which is discounted 98 per cent from its previous day market price of Rs 743.40 per share.

However, company did not mention the amount it intends to raise from rights issue.

In order to enter into largely unorganised women wear retail sector, the company has set up 10 showrooms across Rajasthan, Surat and Kolkata.

“Taking into consideration the growth opportunities and the potential of the retail business, it has been decided that the funds be utilised to finance the cost of setting up of 5 new retail outlets in Mumbai and Pune inclusive of deposits for the showrooms, furniture & fixtures and working capital and the construction and development of owned showroom of around 5000 square feet,” the company said.

The company aims to increase its retail outlet from 10 to 16 from the funds raised. The company was trading at Rs 746.20 up 0.38 per cent on the Bombay Stock Exchange.