The company’s 2025 bonus issues made up 99.5% of pre-IPO shares

The company expanded its pre-IPO equity base mainly through two 2025 bonus issues rather than cash equity raising. The two bonus allotments added 99,96,775 shares, or 99.5% of the 1,00,50,275 fully paid pre-issue shares, while the only rights issue added 43,500 shares for cash.

How did the company reach 1,00,50,275 pre-IPO shares?

The company reached 1,00,50,275 pre-IPO equity shares through four allotment events, beginning with 10,000 incorporation shares and ending with the April 26, 2025 bonus issue. Every share had a face value of Rs 10 and was fully paid, according to the capital history in the Red Herring Prospectus.

The sequence shows that the share count rose from 10,000 to 27,10,000 after the first bonus issue, then to 27,53,500 after a rights issue, and finally to 1,00,50,275 after the second bonus issue. Paid-up share capital rose from Rs 1 lakh at incorporation to Rs 10.05 crore before the proposed issue.

The company’s authorised capital was also raised before the allotments. It increased from Rs 1 lakh divided into 10,000 shares at incorporation to Rs 5 crore divided into 50,00,000 shares on December 12, 2024, and then to Rs 15 crore divided into 1,50,00,000 shares on April 25, 2025. The April 2025 authorised-capital increase occurred one day before the 72,96,775-share bonus allotment.

Why do the company’s 2025 bonus issues account for 99.5% of pre-IPO shares?

The company’s two 2025 bonus issues account for 99.5% of pre-IPO shares because they issued a combined 99,96,775 shares out of the pre-issue total of 1,00,50,275 shares. The calculation combines 27,00,000 shares issued on February 23, 2025 with 72,96,775 shares issued on April 26, 2025.

A bonus issue is an allotment of additional shares to existing holders without a cash issue price. The company states that both bonus issues were made through capitalisation of reserves and surplus, meaning amounts in reserves were transferred into paid-up share capital. The February issue carried a 270:1 ratio, or 270 bonus shares for each share held, while the April issue used a 53:20 ratio, or 53 shares for every 20 shares held.

The 99.5% figure describes the source of the share count, not fresh cash received by the company. Both bonus issues were listed at a nil issue price and as consideration other than cash. Their combined face-value addition was Rs 10 crore, comprising Rs 2.70 crore from the February allotment and Rs 7.30 crore from the April allotment.

How much of the company’s pre-IPO capital came from cash equity raising?

The company’s capital history records one cash rights issue before the proposed issue: 43,500 shares allotted on March 29, 2025 at Rs 115 per share. Those shares represented about 0.4% of the 1,00,50,275 pre-issue shares, compared with 99.5% created through the two bonus issues.

A rights issue offers shares to existing shareholders, and the company’s March 2025 issue was made in a 1.62:3 ratio. It included a Rs 10 face value and a Rs 105 premium per share, as shown in the capital-history table. The table records cash consideration for the rights issue, unlike the two bonus issues, which carried no securities premium.

The company states that it had not issued shares in the year immediately before filing the Red Herring Prospectus at a price lower than the proposed issue price. It also reported a nil securities premium account before the issue, while the capital-history table shows the March 2025 rights issue at a Rs 105 premium per share. This capital-structure section does not provide a separate reconciliation of that pre-issue nil balance.

Who received the company’s bonus shares and how concentrated was ownership?

The company’s February and April 2025 bonus shares were allotted entirely to Mr. Rajkumar Chaudhary and Mr. Vinubhai Kanjibhai Chavda at the time of each allotment. Each received 13,50,000 shares in the February bonus issue; in April, Mr. Rajkumar Chaudhary received 36,48,388 shares and Mr. Vinubhai Kanjibhai Chavda received 36,48,387 shares.

The near-equal distribution followed the original incorporation ownership, when the two subscribers received 5,000 shares each out of 10,000 shares. They also each received 21,750 shares in the March 2025 rights issue. The initial 10,000 shares established the ownership proportions on which the 270:1 first bonus ratio operated.

By the Red Herring Prospectus date, the promoter and promoter group held 97,75,075 shares, or 97.26% of the 1,00,50,275 pre-issue shares. Public shareholders held 2,75,200 shares, or 2.74%, across eight shareholders, while seven promoter and promoter-group shareholders held the promoter stake. Bonus shares preserve relative ownership when eligible holders receive shares at the stated ratio.

The company’s two named original subscribers no longer held identical pre-issue totals. Mr. Rajkumar Chaudhary held 46,86,488 shares, or 46.63%, and Mr. Vinubhai Kanjibhai Chavda held 48,85,487 shares, or 48.61%. The prospectus records 15 shareholders in total based on a beneficiary position statement dated October 23, 2026.

What does the company’s capital structure say about future dilution?

The company’s pre-issue paid-up capital of 1,00,50,275 shares is set to rise by up to 36,48,000 equity shares under the proposed issue, producing up to 1,36,98,275 shares after the issue. The stated increase would equal about 36.3% of the pre-issue share base, although the final issue price and allotment remain shown as placeholders in the capital-structure table.

The company had one class of share capital, equity shares with a Rs 10 face value, as of the Red Herring Prospectus date. It reported no outstanding convertible instruments, preference shares, warrants, depository receipts, partly paid shares or equity shares with differential voting rights. Each equity share carried one vote.

The company also stated it had no intention or proposal to alter its capital structure for six months from the issue opening through a share split, consolidation, bonus issue, rights issue, further public issue or qualified institutions placement. The statement is subject to the disclosed exception that the board may issue shares after listing for an acquisition, merger, joint venture, regulatory compliance, a scheme of arrangement or another purpose it considers in the company’s interest.

Conclusion

The company’s pre-IPO capital history was overwhelmingly a reserve-capitalisation exercise in 2025: 99,96,775 of 1,00,50,275 shares came from two bonus issues, while only 43,500 shares came through the documented cash rights issue. The distinction explains why the increase in paid-up share capital from Rs 1 lakh to Rs 10.05 crore did not principally reflect a sequence of cash equity fundraisings.

The next disclosed capital-structure change is the proposed issue of up to 36,48,000 shares, which would raise the share count to up to 1,36,98,275. The final allotment and resulting post-issue ownership remain to be determined, while any later equity issuance would depend on the company using its stated exception for an acquisition, merger, joint venture, regulatory compliance or another board-approved purpose.