The Company bonus issue created 99.8% of pre-IPO equity

The Company’s November 8, 2025 bonus issue created about 99.8% of its pre-issue equity because it allotted 1 crore shares against a post-subdivision base of 20,000 shares. The 500-for-1 bonus lifted paid-up shares to 1.002 crore, while two promoters held 80.00% and three holders owned 99.99% before the issue.

How did The Company bonus issue create 99.8% of pre-IPO equity?

The Company bonus issue created 99.8% of pre-IPO equity by adding 1 crore fully paid equity shares on November 8, 2025 to 20,000 shares outstanding after an August 21, 2025 subdivision. The bonus ratio was 500 equity shares for every one equity share held. The resulting pre-issue paid-up capital was 1.002 crore equity shares with a face value of Rs 5 each, equivalent to Rs 5.01 crore of paid-up share capital.

The November 2025 issue was a capitalisation of reserves rather than a cash fund-raising transaction. The prospectus describes the consideration as other than cash and states that the benefit to The Company was capitalisation of reserves. It also states that The Company has not revalued assets since incorporation and did not issue the bonus shares by capitalising revaluation reserves.

The capital history records 10,000 shares issued at incorporation with a Rs 10 face value. The August 21, 2025 subdivision changed each Rs 10 share into one Rs 5 share, doubling the outstanding number to 20,000 without changing the Rs 1 lakh paid-up capital. The later bonus increased the number of shares by 500 times the post-subdivision base, which accounts for the sharp change in the equity count.

The capital-history table contains one row describing 1,00,000,000 shares in the November 2025 allotment. That figure conflicts with the stated cumulative total of 1.02 crore shares, the detailed bonus-allottee table totalling 1 crore shares, and the pre-issue capital of 1.002 crore shares. The detailed allotment disclosures and the 500-for-1 ratio support 1 crore as the disclosed operative bonus-share total.

Who received The Company’s November 2025 bonus shares?

The Company allotted all 1 crore November 2025 bonus shares to Jitendra Kumar Negi, Neelu Ramesh Aurangabadkar and Mridul Dilip Singhvi. Jitendra Kumar Negi received 49.05 lakh shares, Neelu Ramesh Aurangabadkar received 20 lakh shares, and Mridul Dilip Singhvi received 30.95 lakh shares. The three disclosed allocations total 1 crore shares.

Jitendra Kumar Negi and Mridul Dilip Singhvi are identified as promoters in The Company’s capital build-up. Their combined bonus allocation was 80 lakh shares, or 80.00% of the 1 crore bonus shares. Neelu Ramesh Aurangabadkar received the other 20 lakh shares, or 20.00% of the bonus issue.

The prospectus presents the allotment as an entitlement under the 500-for-1 ratio, not as a selective cash subscription. All shares described in the capital history are fully paid from their allotment dates. The capital structure also states that The Company has no outstanding convertible instruments, meaning no conversion rights are included in the 1.002 crore pre-issue share count.

How concentrated was The Company’s ownership before the issue?

The Company’s pre-issue ownership was concentrated because three shareholders held 1,00,19,960 shares, or 99.99% of paid-up equity. Jitendra Kumar Negi held 49,14,770 shares, equal to 49.05%; Neelu Ramesh Aurangabadkar held 20,04,000 shares, equal to 20.00%; and Mridul Dilip Singhvi held 31,01,190 shares, equal to 30.95%.

The remaining 40 shares accounted for the difference between the three-holder total and the 1.002 crore pre-issue total. The capital build-up states that Jitendra Kumar Negi transferred 40 shares on December 4, 2025 to four individuals, with 10 shares transferred to each person. The pre-issue shareholding pattern therefore showed seven shareholders in total.

The same pattern classified two shareholders as promoters and five as public shareholders. The promoter category held 80,15,960 shares, or 80.00%, while the public category held 20,04,040 shares, or 20.00%. The four holders of 10 shares each, together with Neelu Ramesh Aurangabadkar’s 20,04,000 shares, formed the disclosed public shareholding.

The ownership concentration differed from the prospectus’s historical disclosure based on a 1% threshold. The Company reported no shareholder holding 1% or more one year before the prospectus date, and also reported none two years before that date. As of the prospectus date and 10 days before it, the same three holders each exceeded 1% and together held 99.99%.

What did the bonus issue mean for The Company promoter control?

The Company’s bonus issue left its two promoters holding 80.00% of pre-issue paid-up equity. Jitendra Kumar Negi held 49,14,770 shares, or 49.05%, and Mridul Dilip Singhvi held 31,01,190 shares, or 30.95%. The prospectus states that one equity share carried one vote and that no promoter shares were pledged or otherwise encumbered as of the prospectus date.

The prospectus’s post-issue capital build-up shows a lower combined promoter holding of 70,16,360 shares, or 49.48% of post-issue equity. Jitendra Kumar Negi is shown with 39,15,170 shares, or 27.61%, and Mridul Dilip Singhvi with 31,01,190 shares, or 21.87%. The reduction reflects the proposed issue structure, including a proposed sale of 9,99,600 shares by Jitendra Kumar Negi.

The disclosed post-issue percentages depend on the issue proceeding as set out in the prospectus. The Company’s issued and paid-up capital is stated as up to 1,41,80,400 shares after the issue, compared with 1,00,20,000 shares before it. A fresh issue would expand the share base, while the proposed sale by Jitendra Kumar Negi would reduce his share count without adding new company shares.

What lock-ins and capital restrictions apply to The Company?

The Company says 70,15,000 shares held by its promoters will form promoter contribution and will be locked in for three years from allotment in the issue. Those shares are stated to represent 49.47% of post-issue equity. The disclosure says the shares are eligible for minimum promoter contribution under Securities and Exchange Board of India, or SEBI, Issue of Capital and Disclosure Requirements regulations because they are not pledged and do not arise from revaluation reserves.

Promoter holdings above minimum promoter contribution are subject to phased lock-ins under the disclosed SEBI rules. The prospectus states that 50% of the excess holding will be locked in for two years and the remaining 50% for one year from allotment in the initial public offer. It also states that the final lock-in details remain subject to the basis of allotment.

The Company says it will not make a further capital issue between filing the prospectus and listing, or refund of application money, unless the prospectus contains the required disclosures. The stated restriction covers public issues, rights issues, preferential issues, qualified institutional placements and bonus issues, with specified employee-scheme exceptions. The Company also says it does not intend to split or consolidate the equity-share denomination for six months from the issue opening date.

After listing, The Company says it may issue equity shares or securities convertible into equity for an acquisition, merger, joint venture, regulatory compliance, a scheme of arrangement or another board-approved purpose. Such a transaction would change the share base or ownership percentages if it occurred. The prospectus does not disclose a specific post-listing transaction of that type.

Conclusion

The Company’s current pre-issue ownership structure arose principally from a single November 2025 capital action. The 1 crore-share bonus converted a 20,000-share post-subdivision base into 1.002 crore shares, resulting in a structure where two promoters held 80.00% and three shareholders held 99.99% of pre-issue equity.

The next disclosed ownership milestone is the shareholding pattern that The Company says it will file one day before listing. That filing should show the final effect of the proposed fresh issue and proposed sale by Jitendra Kumar Negi, while the inconsistent 1,00,000,000-share entry in the capital-history table remains a figure to reconcile with the detailed 1 crore-share bonus allocation.