Mercury EV-Tech Announces ₹480 Crore Rights Issue at 25% Premium! Small-Cap EV Stock Under ₹100 Sees Big Gains

Mercury EV-Tech Ltd., a small-cap stock, has announced a rights issue of preferential shares and warrants, as per a filing with the Bombay Stock Exchange (BSE) on Friday, September 13. The company’s board of directors approved the issue during their meeting, aiming to raise nearly ₹480 crore. This announcement was made after the close of the market, with Mercury EV-Tech shares closing 4.94 per cent higher at ₹96.92, compared to ₹92.36 at the previous market close.

Rights Issue Details:

The board approved a preferential issue of up to 1,57,41,000 equity shares, or nearly 1.57 crore shares, at a price of ₹75 per share. This includes a face value of Re 1 per share, with a premium of ₹74. The total value of this issue is not expected to exceed ₹118,05,75,000 or ₹118.05 crore. Mercury EV-Tech confirmed this in its official exchange filing:

“To issue up to 1,57,41,000 equity shares of the company, at a price of ₹75 per equity share, each having a face value of Re 1, with a premium of ₹74, aggregating to not more than ₹118,05,75,000 to the proposed allottees.”

In addition to the equity shares, the company’s board also approved a warrant issue of up to 4,83,00,000 or 4.83 crore convertible warrants, each priced at ₹75. Each warrant will be convertible into one fully paid-up equity share, with a face value of Re 1 and a premium of ₹74 per share. The total value of this issue is pegged at ₹362,25,00,000 or ₹362.25 crore. The company stated in its filing:

“To issue up to 4,83,00,000 convertible warrants of the company, at a price of ₹75 per warrant, each convertible into, or exchangeable for, 1 fully paid-up equity share of the company, having a face value of Re 1 with a premium of ₹74, aggregating to not more than ₹362,25,00,000, to the proposed allottees.”

As per the filing, once the warrants are issued, 25 per cent of the total issue size will be called upfront from the proposed allottees. This payment structure ensures that an initial amount is collected at the time of allotment.

Mercury EV-Tech has also scheduled a board meeting for October 12, 2024. In this meeting, the company will seek approval from its shareholders regarding the rights issue, further advancing the plan to raise funds through the issuance of preferential shares and convertible warrants.