Majestic Auto starts SHPL plan, targets ₹29.28cr gain

What changed for Majestic Auto

Majestic Auto Ltd (MAJESAUT) has begun implementing the resolution plan of Sharan Hospitality Private Limited (SHPL) after a favourable Supreme Court order dated July 17, 2026. The company said the transaction is structured as a multi-phase implementation that culminates in transferring SHPL-related securities to two institutional funds. Majestic Auto described the process as a balance-sheet and returns optimisation exercise, built around monetising securities acquired under the resolution plan. In the first phase, the company infused ₹40 crore into SHPL through a mix of equity and non-convertible debentures (NCDs). With this step, SHPL became a wholly-owned subsidiary of Majestic Auto. The company has indicated a pre-tax gain expectation of about ₹29.28 crore from the overall transaction economics.

Supreme Court order and settlement framework

Majestic Auto told shareholders it executed a Consent and Dispute Settlement Agreement with Assets Care & Reconstruction Enterprise Limited (ARC) on July 15, 2026. The agreement was taken on record by the Supreme Court on July 17, 2026, enabling implementation of the resolution plan. Separately, a timeline provided in the same set of information also lists “Supreme Court Approval” on July 23, 2026, and “Resolution Implementation” dated Aug 24, 2026. The company’s disclosures position the Supreme Court step as the key trigger that allowed the resolution plan to proceed in practice.

Total payment of ₹105.43 crore and what it includes

The company disclosed a total payment of approximately ₹105.43 crore for implementing the plan. It is split into ₹81.84 crore towards the Resolution Plan Amount and ₹23.58 crore to ₹23.59 crore towards Additional Interest, as stated in different parts of the information set. Majestic Auto also outlined how it plans to finance the implementation via a Securities Purchase Agreement with NovumLake Property Fund and 360 ONE Real Assets Advantage Fund. The company’s strategy includes subscribing to SHPL securities and later transferring those securities to the institutional funds for a total consideration of ₹105.43 crore.

Phase 1: ₹40 crore infusion and SHPL becomes a subsidiary

In the first phase, Majestic Auto subscribed to SHPL securities worth ₹40 crore. This comprised subscription to 5,00,000 equity shares and ₹35 crore of NCDs. The equity shares were described as 5 lakh shares at ₹100 each, which works out to ₹5 crore. The NCDs in phase one were stated at ₹35 crore. Following this allotment, the company said SHPL became a wholly-owned subsidiary, giving Majestic Auto 100% control of SHPL’s paid-up equity capital.

Subsequent phases: balance NCDs, preference shares and ICD

Majestic Auto said subsequent phases will include subscription to the remaining NCDs of ₹36.15 crore and receipt of 50 lakh bonus redeemable preference shares (RPS), for which the amount was not specified. The structure also includes an inter-corporate deposit (ICD) of ₹29.28 crore, described as recoverable and not part of the sale consideration. The company separately stated that ₹76.15 crore is towards subscription to SHPL securities, with the ICD being an additional infusion.

Transfer to institutional funds and the expected gain

After the acquisition steps are completed, Majestic Auto plans to transfer all securities to NovumLake Property Fund and 360 ONE Real Assets Advantage Fund. The disclosures indicate an aggregate acquisition cost of ₹76.15 crore for the securities and a total sale consideration of ₹105.43 crore. Based on these figures, the company expects a pre-tax gain of approximately ₹29.28 crore. The company also highlighted that the ICD is recoverable and not part of the sale consideration, and it drew attention to the way acquisition cost and ICD are separated in the structure.

Majestic Auto’s business profile and where SHPL fits

Majestic Auto is described as a commercial real estate and facility management company that provides facility management and rental services through subsidiaries in India. Its focus areas include commercial real estate leasing, factory space leasing and facility management. The shareholder Q&A section also notes that SHPL owns a commercial complex in Mumbai, which forms the asset base linked to the resolution plan. Separately, the information set also mentions Majestic Auto’s legacy manufacturing activities, stating it was initially Majestic Gears and manufactures mufflers, fine blanking components, spokes and spare parts for two-wheelers.

Stock snapshot and key market metrics (as of Aug 28, 2026)

On Aug 28, 2026, Majestic Auto’s share price was cited at ₹363.05. In another update on the same date, the stock was said to be trading at ₹364, down by ₹4.1 from the previous close. An exchange-wise snapshot stated Majestic Auto’s share price at ₹364.00 on NSE and ₹363.00 on BSE as on Aug 28, 2026 at 03:29 PM. The market capitalisation was reported at ₹378.31 crore as of Aug 28, 2026. The current dividend yield was stated as 16.49.

Transaction structure at a glance

The company provided the following components for the SHPL resolution-plan implementation and funding structure.

Dividend disclosures referenced by the company

The board approved a final dividend of 250%, or ₹25 per equity share (face value ₹10), for FY2025-26, subject to shareholder approval. The same information set also states that the aggregate dividend for FY26 stands at ₹60 per share, or 600% of face value. These disclosures were presented alongside the company’s updates on the resolution plan progress.

Company identifiers and contact details provided

Majestic Auto’s BSE scrip code was stated as 500267. The company’s registered address was listed as 3rd Floor, 2A, Mahindra Tower, District Centre, Bhikaji Cama Place, New Delhi, Delhi, 110065. A phone number was provided as 011-41641689.

Why the SHPL implementation matters for investors

Majestic Auto’s disclosures frame the SHPL resolution-plan implementation as a large, multi-step financial transaction, with phase one already completed via ₹40 crore of securities subscription. The company has clearly stated the intended end-state: transferring the acquired securities to two named institutional funds for a total consideration of ₹105.43 crore. The expected pre-tax gain of about ₹29.28 crore is directly linked to the difference between the stated subscription cost for securities (₹76.15 crore) and the total consideration, alongside the presence of the recoverable ICD. Investors tracking the stock are likely to focus on execution across subsequent phases, the timing of transfers to the funds, and any further disclosures about the preference shares and remaining NCD subscriptions.

Conclusion

Majestic Auto has initiated the first phase of the SHPL resolution plan and made SHPL a wholly-owned subsidiary through a ₹40 crore securities allotment. The company’s stated roadmap includes completing the remaining subscriptions, extending a ₹29.28 crore ICD, and transferring the securities to NovumLake Property Fund and 360 ONE Real Assets Advantage Fund for a total consideration of ₹105.43 crore. Majestic Auto has guided for an expected pre-tax gain of about ₹29.28 crore based on the disclosed structure. The next updates are likely to be tied to completion of the subsequent phases and the planned transfer of securities to the institutional funds.