Viji Finance Eyes Growth with ₹35.7 Crore Warrant Issue

Viji Finance Limited is set to issue 127.5 million warrants, aiming to raise ₹35.70 crore. These funds are earmarked for expanding its lending activities and supporting general corporate purposes. The company has called an Extra-Ordinary General Meeting (EGM) on April 23, 2026, where shareholders will vote on this proposal.

The price for each warrant has been set at ₹2.80. If approved and exercised, the funds will be primarily directed towards onward lending, accounting for approximately 75.64% (around ₹27.00 crore), with the remaining 24.36% (about ₹8.70 crore) allocated for general corporate needs.

Why This Matters for Investors

This capital infusion is designed to strengthen Viji Finance's financial capacity, especially for its core business of lending. By increasing its equity base, the company seeks to support business growth and expansion. However, the conversion of these warrants into shares will increase the total number of equity shares outstanding, leading to a dilution of existing shareholders' ownership percentages.

Company Background

Viji Finance operates as a non-banking financial company (NBFC) and is classified as a micro-cap entity. The board approved this warrant issuance plan in March 2026. This comes after the company reported a net profit of ₹94.22 lakhs in Q3 FY26, marking a recovery from previous losses. As of December 31, 2025, Viji Finance's debt-to-equity ratio stood at 55.1%. The company also conducted a Rights Issue in mid-2024, indicating a consistent strategy to secure capital for operations and growth.

Key Changes Ahead

Upon successful conversion of the warrants:

• The total number of Viji Finance's equity shares will increase.
• Existing shareholders will hold a smaller percentage of the company.
• The company will gain additional capital for its primary lending business.
• The promoter group's shareholding percentage may decrease, depending on their participation in exercising warrants.

Potential Risks to Monitor

Investors should be aware of several risks associated with this issuance:

• Warrant Forfeiture: Holders risk forfeiting their payments if warrants are not exercised within 18 months of allotment.
• Fund Use Flexibility: The allocation for lending and corporate purposes may vary by up to 10% due to market conditions and management assessments.
• Stock Volatility: Viji Finance's stock has experienced significant price swings, with notable drops to lower circuits in March 2026, suggesting investor caution.
• Director Appointments: Recent issues with timely shareholder approvals led to director positions ceasing for two board members.

Competitive Landscape

As a micro-cap NBFC, Viji Finance operates in a vastly different league compared to major financial players like Bajaj Finance, Shriram Finance, or Muthoot Finance. Its fundraising efforts, such as this warrant issue, are critical for its growth. Larger competitors typically benefit from broader market access and more diversified funding sources.

Next Steps for Investors

Key developments to watch include:

• The outcome of the EGM on April 23, 2026, and shareholder approval.
• Securing necessary approvals from stock exchanges and potentially the Reserve Bank of India (RBI).
• The actual exercise of warrants by allottees within the 18-month window.
• How effectively Viji Finance deploys the newly acquired capital into its lending portfolio.