Financial service provider Fusion Finance share price jumped over 7.51 per cent in Monday’s trading session to ₹164.20 apiece after the company announced the completion of ₹800 crore Rights Issue, which was subscribed 1.5x or 150 per cent.
Fusion Finance stock has gained nearly 16.84 per cent in over a month, however, has fallen over 11 per cent in six months.
Fusion Finance rights issue details
The offering, which was open on April 15, witnessed robust participation from existing institutional investors, including promoters Honey Rose Investment Ltd, an affiliate of Warburg Pincus LLC, and Creation Investments Fusion LLC, underscoring investors’ conviction in Fusion’s growth trajectory and business fundamentals.
The rights issue comprised up to 6,10,58,392 partly paid-up equity shares at a price of ₹131 per rights equity share (including a premium of ₹121), aggregating up to ₹799.86 crore.
“The strong response to our Rights Issue is a testament to the enduring trust of our shareholders in Fusion’s operational resilience and strength as a business. The additional capital will reinforce our balance sheet, enabling us to capitalize on the emerging opportunities while continuing to deliver sustainable value to all stakeholders,” said Devesh Sachdev, Managing Director, Fusion Finance Limited.
The proceeds from the rights issue will enhance the Company’s capital adequacy, further strengthening its position as one of the most well-capitalized entities in the Indian microfinance sector.
IIFL Capital Services Limited has been appointed as the Lead Manager to the Issue, meanwhile CRISIL Ratings Limited serves as the Monitoring Agency to the Issue. Axis Bank Limited has been appointed as the Banker to the issue.
“Over the past year, Fusion has made significant strides in advancing its long-term strategy including strengthening its executive leadership team. The recent appointment of Mr. Sanjay Garyali as the Chief Executive Officer was one of the key steps towards this direction. Mr. Garyali brings over 28 years of experience in the banking and finance industry with deep expertise in retail finance,” the company said in a release dated May 12.
Speaking on the development, Sanjay Garyali, Chief Executive Officer, Fusion Finance Limited, said, “The success of this Rights Issue reflects the strength of Fusion’s franchise and the trust of our shareholders. This milestone event will enable us to further strengthen our foundation as we drive the next phase of our journey, with a focus on scale, sustainability and long-term value creation.”
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