4 cos file papers to raise about Rs 700 cr via rights issue

As many as four companies, including Mahindra Lifespace Developers, have approached capital markets regulator Sebi to raise nearly Rs 700 crore through rights issue.
Other three firms are Vardhaman Special Steels, Intellect Design Arena and ZenoTech Laboratories.
These four companies filed draft documents with the Securities Exchange Board of India (Sebi) in January and February this year to mop up a total of Rs 682 crore through rights issue.
Individually, Mahindra Lifespace Developers plans to garner up to Rs 300 crore by way of issue of equity shares to the existing shareholders, followed by Intellect Design Arena (up to Rs 200 crore), ZenoTech Laboratories (up to Rs 120 crore) and Vardhaman Special Steels (about Rs 62 crore).

Besides, rights issue of private lender South Indian Bank and state-owned Canara Bank are currently underway.
In rights issue, shares are issued to existing shareholders as per their holding at a pre-determined price and ratio.
According to market experts, market stability could be the one reason why companies are opting for an equity issuance to existing shareholders.
Last year, companies mopped a total of Rs 1,230 crore through rights issue mode.