Future Retail extends Wednesday's slide

Future Retail lost 2.96% to Rs 131 at 15:17 IST on BSE, with the stock extending Wednesday's fall triggered by equity dilution worries.

Meanwhile, the S&P BSE Sensex was up 95.35 points or 0.37% at 25,569.24.

On BSE, so far 3.21 lakh shares were traded in the counter as against average daily volume of 10.30 lakh shares in the past one quarter.

The stock was volatile. The stock lost as much as 3.62% at the day's low of Rs 130.10 so far during the day. The stock rose as much as 1.29% at the day's high of Rs 136.75 so far during the day. The stock had hit a 52-week low of Rs 63.30 on 1 August 2013. The stock had hit a 52-week high of Rs 149.90 on 20 June 2013.

The stock had underperformed the market over the past one month till 11 June 2014, surging 9.14% compared with the Sensex's 10.78% rise. The scrip had, however, outperformed the market in past one quarter, jumping 64.23% as against Sensex's 16.71% rise.

The mid-cap company has equity capital of Rs 46.36 crore. Face value per share is Rs 2.

Shares of Future Retail have declined 9.96% in two trading sessions from Rs 145.50 on 10 June 2014, after the company during market hours on Wednesday, 11 June 2014, said its board of directors has considered various fund raising options to raise up to Rs 2000 crore. The stock had tumbled 7.22% to settle at Rs 135 on Wednesday, 11 June 2014.

Future Retail said that a meeting of board of directors of the company was held on Wednesday, 11 June 2014 and the board while considering the various options approved raising of funds upto Rs 2000 crore through issue of shares/warrants on preferential basis to investors and promoters of approximately Rs 400 crore and issue of shares of different classes on rights basis upto Rs 1600 crore and accordingly has approved the following fund raising resolutions. The company proposes to utilise the proceeds of the various fund raising options at least 75% for its debt reduction program in addition to also fund its future growth, Future Retail said.

The board also approved issue of 1.53 crore equity shares of Rs 2 each at a price of Rs 130 per share (inclusive or premium of Rs 128 per share) aggregating to Rs 2000 crore on preferential basis to Brand Equity Treaties.

The board also approved issue of 76.92 lakh warrants at a price of Rs 130 per warrant aggregating to Rs. 100 crore to Future Corporate Resources one of the promoter group entity with an option to the warrant holder to acquire same number of equity shares of Rs 2 each (at a premium of Rs 128 per share) (Warrants - A) withIn a period of 18 months pursuant to the provisions Chapter VII of Securities & Exchange Board of India (Issue of Capital & Disclosure Requirements) Regulations, 2009 relating to Preferential lssues.

An Extraordinary General Meeting of the company will be held on 9 July 2014, for obtaining shareholders approval for the preferential issue of equity shares to Investor and Warrants - A to promoter group company stated herein above.

Accordingly, the relevant date for the pricing of both the aforesaid preferential issues of equity shares and Warrants - A is 9 June 2014. The board further approved issue of such number of warrants at such price as per SEBI ICDR Regulations per warrant not exceeding Rs 100 crore to Future Corporate Resources one of the promoter group entity with an option to the warrant holder to acquire same number of Class B (Series - 1) shares of Rs 2/- each (having differential voting rights) (Warrants - B) within a period of 18 months pursuant to the provisions Chapter VII of Securities & Exchange Board of India (Issue of Capital & Disclosure Requirements) Regulations, 2009 relating to Preferential Issues. The relevant date for the pricing of preferential issues of Warrants - B will be decided based on the date of passing of resolution by members of the company through postal ballot, Future Retail said.

The board also approved issue of equity shares, Class B (Series 1) shares (having differential voting rights) or convertible securities (Securities) upto Rs 1600 crore to its existing shareholders on a rights basis as per the applicable SEBI Regulations and other applicable laws.

The board decided to conduct postal Ballot for approval of the shareholders for issue of Warrants - B convertible into Class B (Series 1) shares to promoters of the company on preferential basis and securities to the existing shareholders on rights basis.

Future Retail's net profit declined 34.4% to Rs 1.62 crore on 151.8% growth in net sales to Rs 2295.46 crore in the quarter ended 31 March 2014 over the quarter ended 31 March 2013.

Future Retail, earlier known as Pantaloon Retail (India), is the flagship company of the Future Group. It is leading retailer that operates multiple retail formats in both value and lifestyle segment of Indian consumer market.

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