Jain Irrigation board approves fund raising plan, stock down 6%

Jain Irrigation Systems has dipped 6% to Rs 60.55 after the Securities Issuance Committee of the company has approved the fund raising plans of $203 million (approx Rs 1,127 crore) to repayment of all the high cost short term and long term loans of the company due in FY2013, and its subsidiaries.

“The company announced plan for fund raising of approx. $200 million to deleverage and strengthen its balance sheet, to reduce interest cost and to balance its currency exposure with long term maturities,” Jain Irrigation Systems said in a filing.

The company proposed to raise $73 million (Rs 405 crore) through issue of equity shares on preferential issue, $55 million (Rs 305 crore) via foreign currency convertible bonds (FCCBs) issue and $75 million (Rs 417 crore) by way of raising of LIBOR linked external commercial borrowings (ECB). The committee had already approved raising of approx. Rs 64.72 crore by way of equity warrants to promoter group on preferential basis.

The stock opened at Rs 64.50 and hit a low of Rs 60.55 on the BSE. A combined 11.52 million shares have changed hands on the counter till noon deals on both the exchanges.