Viji Finance approved the allotment of 8.85 crore convertible warrants to 19 investors, raising ₹6.19 crore upfront. The total issue size is ₹24.78 crore, a reduction from the original plan.

Viji Finance Completes Preferential Allotment, Raises ₹6.19 Crore Upfront

8.85 crore convertible share warrants allotted to 19 non-promoter investors. Upfront payment of ₹6.195 crore received.

Reader Takeaway: Capital secured upfront, but issue size reduced; monitor conversion in 18 months.

What just happened

Viji Finance Limited's Preferential Allotment Committee has approved the issuance of 8.85 crore convertible share warrants at ₹2.80 per warrant. The total issue size is ₹24.78 crore. The company has received 25% of the total consideration upfront, amounting to ₹6.195 crore. These warrants can be converted into equity shares within 18 months from the allotment date.

Why this matters

This move secures additional capital for Viji Finance, bolstering its liquidity. The upfront funds of ₹6.195 crore provide immediate financial resources. However, the total issue size was revised downwards from an original plan of ₹35.70 crore due to the non-participation of three proposed investors.

The backstory

The company had initially planned to issue 12.75 crore warrants for a total of ₹35.70 crore. However, three specific investor groups—Vicky R. Jhaveri HUF, Rajesh Nanubhai Jhaveri HUF, and Mrs. Harsha Rajesh Jhaveri—did not proceed with their investment. This led to a revised plan for issuing 8.85 crore warrants.

What changes now

With the allotment approved, the 19 non-promoter investors now hold convertible warrants. They have the right to convert these into equity shares of Viji Finance within the next 18 months, subject to paying the remaining 75% of the consideration. The shares issued upon conversion will be subject to SEBI (ICDR) Regulations, 2018 lock-in requirements.

Risks to watch

A key watch point is the revision of the issue size, indicating a lower-than-anticipated capital inflow. Investors should also monitor whether the allottees exercise their conversion rights within the 18-month period. Failure to convert will result in the forfeiture of the upfront payment by the company, while the allottees would lose their investment in warrants.

Peer comparison

As a finance company, Viji Finance's capital-raising activities are typical for the sector. However, specific comparisons on preferential allotment sizes and terms would depend on recent similar actions by other small-cap or micro-cap finance entities, which are not detailed in this filing.

Context metrics (time-bound)

• Warrants Allotted: 8,85,00,000 units
• Issue Price per Warrant: ₹2.80
• Total Issue Size: ₹24.78 crore
• Upfront Payment (25%): ₹6.195 crore
• Conversion Period: 18 months from allotment
• Original Proposed Issue Size: ₹35.70 crore (12.75 crore warrants)

What to track next

Investors should closely watch the company's communication regarding the exercise of conversion rights by the warrant holders over the next 18 months. Fund utilization plans and any further corporate actions by Viji Finance will also be important for shareholders.