U.Y. Fincorp Limited proposes Rs 168.45516 crore for lending growth

U.Y. Fincorp Limited proposes to deploy Rs 168.45516 crore from its Rs 187.1724 crore preferential issue for lending-business growth, covering digital-platform lending, secured retail and micro, small and medium enterprise products, supply-chain finance and loan-portfolio acquisitions. The board approved the proposal on November 2, 2026, subject to shareholder and other required approvals.

How will U.Y. Fincorp use the proposed proceeds?

U.Y. Fincorp proposes to allocate Rs 168.45516 crore, about 90% of the Rs 187.1724 crore issue, to augment its capital base and fund lending growth. The stated lending uses include onward lending through its current digital platform, loans against property, gold loans, micro, small and medium enterprise, or MSME, business loans, bills discounting and supply-chain finance.

The remaining Rs 18.71724 crore is proposed for general corporate purposes. The lending allocation also permits U.Y. Fincorp to acquire loan portfolios through direct assignment or other means, in accordance with applicable Reserve Bank of India, or RBI, directions. The notice does not assign separate amounts to the digital platform, secured retail products, MSME loans, supply-chain finance or portfolio acquisitions.

The Rs 168.45516 crore lending category is therefore a combined deployment pool rather than a product-level budget. The company says the objects may vary by plus or minus 10%, depending on factors including financial, market, sectoral and competitive conditions, business performance and strategy, subject to applicable law and board decisions.

What securities will U.Y. Fincorp issue for Rs 187.1724 crore?

U.Y. Fincorp proposes to issue 5,21,20,000 equity shares and 2,45,90,000 warrants at Rs 24.40 per security, for aggregate proceeds of Rs 187.1724 crore. The equity-share component is Rs 127.1728 crore, while the warrant component is Rs 59.9996 crore, producing different funding receipt schedules.

The 2,45,90,000 warrants are proposed for three promoter and promoter-group allottees: Deepak Kothari, Udai Kothari and Dipti Deepak Kothari. Each warrant carries the right to subscribe to one equity share. The 5,21,20,000 equity shares are proposed for non-promoter allottees under the preferential issue.

The Rs 24.40 issue price is Rs 0.02 above the disclosed floor price of Rs 24.38. U.Y. Fincorp calculated that floor price as the higher of the 90-trading-day volume-weighted average price, or VWAP, of Rs 19.96 and the 10-trading-day VWAP of Rs 24.38 on the National Stock Exchange of India before the October 26, 2026 relevant date.

For warrants, an allottee must pay at least 25% at subscription and the remaining 75% at exercise. The holder can convert warrants in one or more tranches within 18 months of allotment; if unexercised within that period, the amount paid on each outstanding warrant will be forfeited and the related rights will lapse.

When does U.Y. Fincorp expect to use the proceeds?

U.Y. Fincorp expects to use proceeds from the Rs 127.1728 crore equity-share allotment within 12 months of receipt and proceeds received from the Rs 59.9996 crore warrant conversion within 24 months of receipt. The separate timelines reflect that warrant funds become available only when warrant holders exercise their conversion rights.

If the proceeds are not fully deployed within those periods, the board may use the balance in later periods in accordance with applicable law. The notice says this could involve rescheduling planned expenditure, revising funding requirements, or increasing or decreasing expenditure for a particular stated purpose.

Pending use for the Rs 168.45516 crore lending object or Rs 18.71724 crore general corporate-purpose object, U.Y. Fincorp may invest the funds in money-market instruments, money-market mutual funds, scheduled commercial bank deposits, Government of India securities or other investments permitted by law. This interim arrangement does not change the proposed issue objects.

How will U.Y. Fincorp's proceeds and ownership changes be monitored?

CredStone Ratings Private Limited will monitor use of the Rs 187.1724 crore preferential-issue proceeds because the issue exceeds Rs 100 crore. U.Y. Fincorp appointed the Securities and Exchange Board of India, or SEBI, registered agency under Regulation 162A of the SEBI Issue of Capital and Disclosure Requirements Regulations.

CredStone Ratings must submit a monitoring report each quarter until 100% of the proceeds are used. U.Y. Fincorp's board and management must comment on the agency's findings, and the company must upload the report on its website and submit it to stock exchanges within 45 days of the end of each quarter.

The proposal also changes the indicated ownership mix. Promoter holding is shown at 71.50% before the issue, 56.12% after the equity-share allotment but before warrant conversion, and 60.17% after full conversion of the 2,45,90,000 warrants. The pre-issue shareholding date is October 28, 2026.

The extraordinary general meeting is scheduled for November 25, 2026, and the preferential allotment is to be completed within 15 days of the special resolution, unless a regulatory approval is pending. Where approval is pending, the 15-day period runs from the date of that approval or another period allowed by the relevant authority.

Conclusion

U.Y. Fincorp's proposed Rs 187.1724 crore preferential issue is primarily a lending-capital plan, with Rs 168.45516 crore assigned to lending through its digital platform, secured retail and MSME products, bills discounting, supply-chain finance and potential loan-portfolio acquisitions. Rs 18.71724 crore is allocated to general corporate purposes, while equity shares and warrants create separate funding timelines.

The next disclosed milestone is the November 25, 2026 extraordinary general meeting, followed by the proposed 15-day allotment timetable after shareholder approval or any required permission. Investors can also watch warrant conversions over the 18-month exercise period, deployment within the 12-month and 24-month targets, and CredStone Ratings' quarterly reports until all proceeds are used.