Basan Equity Broking files applications over two allotment lapses

Basan Equity Broking has disclosed Form GNL-1 applications concerning two historic share-allotment matters: compounding for a March 31, 2011 filing that combined 2,00,000 shares, and adjudication for a one-day delay in processing payments for 5,500 shares allotted on April 24, 2017. The prospectus describes the payment delay as inadvertent and procedural.

What filings has Basan made over historic allotments?

Basan has filed two applications in Form GNL-1 with the Registrar of Companies, or ROC, for separate capital-issuance events dated March 31, 2011 and April 24, 2017. The March 2011 application seeks compounding of an offence connected with the classification of a return of allotment, while the April 2017 application seeks adjudication concerning the timing of cheque processing.

The filings concern different mechanisms and different numbers of shares. The March 2011 matter relates to one Form 2 covering 2,00,000 equity shares, while the April 2017 matter concerns the credit timing for funds raised through a 5,500-share rights issue. The prospectus does not state an order, penalty, settlement or closure for either Form GNL-1 application.

What was the 2011 filing error involving 2,00,000 shares?

Basan states that it filed one Form 2 with the ROC for all 2,00,000 equity shares allotted on March 31, 2011 and classified the entire allotment as a further issue. The prospectus says separate returns should instead have been filed for a further issue of 27,590 equity shares and a conversion of unsecured loans into equity involving 1,72,410 equity shares. Those two components total 2,00,000 shares.

The distinction reflects the consideration recorded for the two March 31, 2011 transactions. The 27,590-share further issue was for cash at Rs 23.50 per share, while the 1,72,410-share allotment was for consideration other than cash through conversion of unsecured loans into equity at Rs 23.50 per share. Basan identifies the combined classification in Form 2, rather than the disclosed issue price or aggregate share count, as the basis for SRN AB7108458.

The detailed allottee entries for the further issue add to 27,590 shares: 19,840 shares to Subhash Moolchand Agarwal HUF, 6,400 to Anita Agarwal, 1,240 to Santosh Selvaraj, 100 to Aditya Agarwal and 10 to Sameer A. Seth. A continuation row in the prospectus states a total of 27,500 shares, but the paid-up capital history, cumulative share count of 37,590 after the issue and the detailed entries use 27,590 shares.

What happened in Basan's April 2017 rights issue?

Basan says its April 24, 2017 rights issue of 5,500 fully paid equity shares was based on duly completed application forms received from shareholders within the offer period. The shares had a face value of Rs 10 each and an issue price of Rs 100 each, including a Rs 90 premium. The rights issue was offered to existing shareholders in an approximate ratio of one share for every 42 shares held.

The disclosed lapse was that the relevant cheques were processed in Basan's bank account with a delay of one day. The prospectus says the funds were credited immediately after the allotment date, describes the delay as unintentional and procedural, and says Basan filed its adjudication application in Form GNL-1 under SRN AB7244033.

The 5,500 shares were allotted as 1,400 shares to Subhash Agarwal, 1,350 shares to Anita Agarwal and 2,750 shares to Selvaraj Rangaswamy. At the stated Rs 100 issue price, the rights issue represented Rs 5.50 lakh of cash consideration. The prospectus does not disclose whether the ROC has decided the adjudication application.

How do the two matters compare with Basan's capital history?

Basan's March 2011 filing matter involved 2,00,000 shares, compared with 5,500 shares in the April 2017 payment-timing matter. After a subsequent rights issue of 24,600 shares on May 18, 2017, the paid-up capital history showed 2,63,600 equity shares and paid-up capital of Rs 26.36 lakh. The difference in share count means the 2011 classification matter covered far more shares than the 2017 rights issue.

A March 31, 2025 bonus issue substantially increased the share count recorded in the capital history. Basan allotted 1,05,44,000 bonus shares in a 40:1 ratio, meaning 40 equity shares for every one equity share held, and said the purpose was to reward shareholders and increase liquidity. The share count rose from 2,63,600 to 1,08,07,600, while paid-up capital rose from Rs 26.36 lakh to Rs 108.76 lakh.

The 2025 bonus issue did not replace the historic disclosures about the March 2011 and April 2017 matters. The prospectus says Basan made issuances and allotments from incorporation through the red herring prospectus filing in compliance with the Companies Act, 1956 and the Companies Act, 2013, to the extent applicable, while separately disclosing both applications.

What does Basan's current capital structure show?

Basan reports 1,08,07,600 fully paid equity shares of Rs 10 each before the proposed offer, representing paid-up capital of Rs 108.76 lakh. It has one class of equity shares, all ranking pari passu, meaning equally in the stated respects, and reports no outstanding convertible instruments as of the red herring prospectus date.

The pre-offer shareholding table shows that seven promoter and promoter-group holders owned all 1,08,07,600 shares, or 100.00% of the equity share capital. The same disclosure records no partly paid shares, warrants, depository receipts or promoter shares that are pledged or otherwise encumbered. Each equity share carries one vote under the disclosed shareholding pattern.

The proposed offer comprises up to 39,00,000 equity shares, including a fresh issue of up to 35,52,000 shares and an offer for sale of up to 3,48,000 shares. Basan's board approved the fresh issue and offer for sale on November 18, 2025, and shareholders approved them on November 22, 2025. The prospectus also says all pre-offer equity shares will be locked in before listing on the SME platform of BSE Limited.

Conclusion

Basan's two applications concern specific historic compliance matters rather than a disclosed change in its current share count or share class. The March 2011 application addresses one Form 2 that classified two allotments totalling 2,00,000 shares as a further issue, while the April 2017 application addresses a one-day delay in crediting funds for a 5,500-share rights issue.

The next disclosed matter to watch is the outcome of the applications identified as SRN AB7108458 for compounding and SRN AB7244033 for adjudication. Basan states that both were filed with the ROC, but the supplied prospectus text does not report a resulting order, penalty, settlement or closure for either application.