Indrayani Biotech Announces Rs 48.79 Crore Rights Issue

Issue Size: Rs 48.79 Crore | Issue Price: Rs 15 per share

Reader Takeaway: The rights issue funds working capital and debt, but auditor qualifications regarding accounting controls and loans remain critical for shareholders.

What just happened

Indrayani Biotech Limited has officially announced a rights issue of up to 3,25,25,897 partly paid-up equity shares. The issue is priced at Rs 15 per share, comprising a Rs 10 face value and a Rs 5 premium. Shareholders are entitled to 5 rights shares for every 7 fully paid-up shares held as of the record date of April 28, 2026.

Why this matters

The company aims to raise Rs 48.79 crore, primarily to support working capital requirements (Rs 20.64 crore) and settle outstanding liabilities. Notably, Rs 500 lakhs of promoter loans and Rs 1,275 lakhs of unsecured advances from Bougainvillea Investments Private Limited are proposed to be settled by allotting equity shares rather than cash payments. This move is intended to clean up the balance sheet.

Promoter Participation

Promoters have committed to subscribing to their full rights entitlement. They will not renounce these shares. Their subscription will be partially adjusted against the Rs 500 lakh loan currently held by them, indicating a commitment to the company's capital restructuring.

Auditor Observations

The company's statutory audit for FY 2025-26 highlights several concerns that investors should note:

• The company provided interest-free loans totaling Rs 42.32 crore to subsidiaries without defined repayment schedules.
• The accounting software used through March 2024 lacked an audit trail, creating uncertainty regarding system integrity.
• There are documented defaults in TDS/TCS payments and associated TRACES defaults.

What to track next

The issue opens on September 15, 2026, and closes on October 14, 2026. Investors should monitor how the company addresses the auditor's concerns regarding internal controls and statutory compliance in future filings.