Sumeet Industries redirects Rs 60 crore to Nakoda chips plant

Sumeet Industries Limited redirected Rs 60 crore of unutilised July 2026 rights-issue money toward operationalising the Nakoda chips plant after members approved the variation on 29 September 2026. The amount comprises Rs 22 crore deferred from solar, Rs 14 crore from an HDFC Bank prepayment and Rs 24 crore held from general corporate purposes.

Why did Sumeet Industries redirect Rs 60 crore of rights-issue funds?

Sumeet Industries redirected the unutilised Rs 60 crore to the acquisition and operationalisation of the Nakoda chips plant through its wholly owned subsidiary, Sumeet Speciality Chips Limited, or SSCL. The company said the Nakoda Limited plant was acquired through the National Company Law Tribunal, or NCLT, process.

The redirected balance consists of Rs 22 crore originally allocated to a solar power project, Rs 14 crore earmarked for an HDFC Bank term-loan prepayment and Rs 24 crore remaining from general corporate purposes. The company raised gross rights-issue proceeds of Rs 199.7511 crore between 22 June 2026 and 20 July 2026.

The board approved the proposed variation on 4 September 2026, and members approved it at the annual general meeting on 29 September 2026. The audit committee and board reviewed the deviation statement on 3 November 2026, while CRISIL Ratings Limited was named as the monitoring agency.

What happened to the planned solar power plant?

Sumeet Industries deferred the Rs 22 crore solar investment and made that amount available for the chips operation. Under the letter of offer, the original project was a 6.5 megawatt, or MW, ground-mounted solar power plant at Village Baiwada, Taluka Deesa, District Banaskantha, Gujarat.

No money from the Rs 22 crore allocation had been used by 30 September 2026. The deviation statement showed nil modified allocation and nil utilisation for that original solar object, with the full Rs 22 crore reported as the variation for the quarter.

Management said Sumeet Industries was simultaneously setting up another 12 MW solar project at a different location and expected it to be completed within the next two months. The filing does not give that project's location, cost or funding source, and distinguishes it from the deferred project initially intended to be funded by the rights issue.

How much debt did Sumeet Industries repay and defer?

Sumeet Industries repaid Rs 9 crore to an Axis Bank term-loan account on 1 August 2026, while redirecting Rs 14 crore previously intended for HDFC Bank to SSCL. The original Rs 23 crore debt-repayment objective comprised Rs 9 crore for Axis Bank and Rs 14 crore for HDFC Bank.

Management said HDFC Bank would charge a 2.7% prepayment penalty and declined its request to waive that charge. Sumeet Industries therefore decided not to make the intended HDFC Bank prepayment, and said the HDFC Bank term loan would instead be repaid under its existing repayment schedule from internal accruals.

The outcome differs between the two lenders. The Axis Bank component was applied in line with the original object, while the HDFC Bank component became funding for the Nakoda chips plant. Sumeet Industries also stated in its 3 November 2026 filing that no payment default on loans or debt securities existed as of 30 September 2026.

How much rights-issue money had Sumeet Industries sent to SSCL?

Sumeet Industries had paid a net Rs 25.9011 crore to SSCL by 30 September 2026 for acquiring and operationalising the Nakoda chips plant. The statutory auditors classified these payments under general corporate purposes, which the letter of offer described as including strategic initiatives, growth opportunities and other board-approved purposes.

Of that total, Rs 23.9011 crore was paid on 1 and 3 August 2026, followed by a net Rs 2 crore payment on 3 September 2026 after a refund referenced in the auditors' statement. Those payments preceded the board's approval of the proposed variation on 4 September, although the auditors said the board approved the utilisation on that date.

The remaining Rs 24 crore within the original Rs 49.9011 crore general-corporate-purpose allocation was held in fixed deposits at 30 September 2026. Together with the Rs 22 crore solar amount and Rs 14 crore HDFC Bank amount, fixed deposits of Rs 60 crore were earmarked for operationalising the chips project when required.

Interest accrued on the fixed deposits was Rs 58.39 lakh up to 30 September 2026, and Rs 5.35 lakh was received when one deposit matured. The auditors said neither amount formed part of the gross rights-issue proceeds, with both recorded as other income.

How were the Rs 199.7511 crore gross proceeds used by September?

Sumeet Industries had deployed or placed the full Rs 199.7511 crore of gross rights-issue proceeds by 30 September 2026 in working capital, Axis Bank debt repayment, SSCL payments, issue-expense reimbursement and fixed deposits. The proceeds reached an Axis Bank current account in two tranches: Rs 25 crore on 24 July 2026 and Rs 174.7511 crore on 28 July 2026.

Working capital was the largest original object at Rs 100 crore, and the deviation statement reported that allocation as fully used without variation. The auditors said the cash-credit accounts paid suppliers of raw materials, stores and services between 25 July 2026 and 24 August 2026.

Rights-issue expenses were estimated at Rs 4.85 crore, and that amount was transferred on 3 August 2026 to reimburse an Axis Bank cash-credit account. Actual expenses were Rs 4.8989 crore, meaning the Rs 4.89 lakh excess over the estimate was met from internal accruals.

The auditors used net proceeds of Rs 194.9011 crore, calculated as gross proceeds of Rs 199.7511 crore less estimated issue expenses of Rs 4.85 crore. They also noted that the letter of offer had stated two net-proceeds figures in different sections, Rs 194.7511 crore and Rs 194.9011 crore, and used the latter calculation in the deviation statement.

Conclusion

The approved variation changes the immediate destination of Rs 60 crore of unutilised rights-issue funds from a deferred solar project, a planned HDFC Bank prepayment and the residual general-corporate-purpose allocation to the Nakoda chips plant. Separately, Sumeet Industries completed the Rs 9 crore Axis Bank repayment, used Rs 100 crore for working capital and had already paid Rs 25.9011 crore to SSCL by 30 September 2026.

The disclosed points to watch are the stated completion of Sumeet Industries' separate 12 MW solar project within the next two months, use of the Rs 60 crore fixed-deposit balance for the chips operation and HDFC Bank term-loan repayments from internal accruals under the existing schedule.