Kizi Apparels seeks approval for Rs 9.04575 crore warrants

Kizi Apparels Limited is seeking shareholder approval to issue up to 51.69 lakh preferential convertible warrants at Rs 17.50 each, with maximum proceeds of Rs 9.04575 crore if fully converted within 18 months of allotment. The board approved the proposal on 30 October 2026, with Rs 7.2366 crore earmarked for working-capital requirements.

What is Kizi Apparels proposing to issue?

Kizi Apparels is proposing to issue up to 51.69 lakh convertible warrants through a preferential private placement to proposed allottees in the promoter and promoter-group category. Each warrant can be converted into one fully paid equity share with a face value of Rs 10, and the issue needs shareholder approval through a special resolution.

The board approved the proposal on 30 October 2026, subject to member and other required approvals. Kizi Apparels said the transaction would not change management or control, nor result in a transfer of ownership to the proposed allottees. The proposed allottees have confirmed their eligibility under Regulation 159 of the Securities and Exchange Board of India Issue of Capital and Disclosure Requirements Regulations, 2018.

At Rs 17.50 per warrant, the maximum consideration is Rs 9.04575 crore. The price includes a Rs 10 face value and Rs 7.50 premium per warrant. The company describes the securities as warrants rather than immediately allotted shares, meaning equity shares would be issued upon exercise of the conversion option.

When can Kizi Apparels warrants be converted and proceeds used?

Kizi Apparels warrant holders can convert each warrant into one equity share within 18 months from the date of warrant allotment. If all 51.69 lakh warrants are converted, the company would allot the same number of new equity shares under this proposal.

Kizi Apparels said conversion proceeds may be received in tranches because holders can exercise warrants at different points during the 18-month period. Management estimates that proceeds will be deployed in phases, based on business requirements and fund availability, within 12 months from the receipt of funds for the warrants.

The resolution also makes allotment conditional on in-principle approval from BSE Limited. After the resolution is passed, Kizi Apparels plans to record the proposed allottees in Form PAS-5 and issue a private-placement offer-cum-application letter in Form PAS-4, as required under the disclosed process.

How will Kizi Apparels use the warrant proceeds?

Kizi Apparels intends to use Rs 7.2366 crore of the maximum proceeds for working-capital requirements and Rs 1.80915 crore for general corporate purposes. Both stated uses have a tentative utilisation period of within 12 months from receipt of the warrant funds.

Working capital accounts for 80% of the maximum Rs 9.04575 crore proceeds, while general corporate purposes account for the remaining 20%. Kizi Apparels said general corporate purposes may include ongoing corporate exigencies, contingencies and company expenses, with deployment proportions to be decided by the board from time to time.

The disclosed allocation is based on full conversion rather than an immediate one-time receipt. Kizi Apparels said the amount required on different dates may vary because funds against conversion will arrive in tranches, so the stated allocation is an intended range linked to actual fund availability.

How was the Kizi Apparels warrant price set?

Kizi Apparels set the warrant price at Rs 17.50, which is Rs 0.07 above its disclosed floor price of Rs 17.43. The company said its equity shares are listed and frequently traded on BSE Limited, and that the pricing followed Chapter V of the Securities and Exchange Board of India Issue of Capital and Disclosure Requirements Regulations, 2018.

The Rs 17.43 floor price was the higher of the 90-trading-day volume-weighted average price of Rs 17.43 and the 10-trading-day volume-weighted average price of Rs 15.27. Volume-weighted average price, or VWAP, measures the average trading price weighted by traded volume; the 90-trading-day VWAP was Rs 2.16 above the 10-trading-day measure.

The relevant date for pricing was 30 October 2026, identified as 30 days before the extraordinary general meeting. As the preferential issue exceeds 5% of post-issue share capital, Kizi Apparels also relied on a valuation report dated 2 November 2026 from registered valuer Bhavin R. Patel under Regulation 166A.

How could the Kizi Apparels issue affect share capital and ownership?

Kizi Apparels reported that total shares could rise from 1.01232 crore before the issue to 1.52922 crore after full conversion of the 51.69 lakh warrants. That post-issue presentation assumes all proposed allottees subscribe to and receive the equity shares on conversion.

The company’s table shows promoter and promoter-group holdings increasing from 60.028 lakh shares, or 59.30%, to 90.778 lakh shares, or 59.36%, after assumed full conversion. It shows public shareholding increasing from 41.204 lakh shares, or 40.70%, to 62.144 lakh shares, or 40.64%; Kizi Apparels said the pattern would change if conversion or allotment does not occur as assumed.

Separately, Kizi Apparels seeks to raise authorised equity share capital from Rs 11 crore, divided into 1.10 crore shares of Rs 10 each, to Rs 16 crore, divided into 1.60 crore shares of Rs 10 each. The proposal would require an alteration of the memorandum of association and member approval through an ordinary resolution.

Conclusion

Kizi Apparels is seeking approval for promoter and promoter-group warrants with a maximum value of Rs 9.04575 crore at Rs 17.50 each. The issue could create up to 51.69 lakh shares on conversion, while management has identified working capital as the principal use, at Rs 7.2366 crore, ahead of Rs 1.80915 crore for general corporate purposes.

Shareholders must vote on the special resolution for the preferential issue and the ordinary resolution to increase authorised capital. If the resolutions are approved and BSE Limited grants in-principle approval, warrant holders will have 18 months from allotment to convert, and Kizi Apparels expects to use received funds within 12 months of each receipt.