Lloyds Metals board clears proposal to raise ₹5,000 crore via QIP

The board of directors of Lloyd Metals and Energy, a mining company involved in the extraction of iron ore and generation of power, has approved the proposal to raise ₹5,000 crore via the qualified institutional placement (QIP) route, a regulatory filing stated on Thursday, March 21.

The QIP option is used by companies to raise funds by selling stake to qualified institutional buyers. Lloyd Metals informed the bourses that it plans to raise the funds in “one or more tranches”.

The board members in their meeting discussed that the fund raising should be executed organically and efficiently, “taking into cognisance that the promoter holding should not be diluted to a greater extent”, the filing noted.

The promoter holding stood at 65.7% as of December 31, 2023, as per the shareholding pattern shared with the exchanges.

“Further, it was also discussed to consider issuance of securities to the promoters/existing large shareholders/strategic investors of the company. And that the company keeps in mind its motto of being debt- free,” Lloyd Metals added.

The fundraise is subject to regulatory approvals, along with a nod from the company’s shareholders. The company said it would be conducting remote e-voting through postal ballots to seek the shareholders’ approval.

The purpose behind the planned raising of ₹5,000 crore was not mentioned in the regulatory filing. Notably, the firm had logged a net profit of ₹44 crore in the December 2023 quarter, which was up 33% as against the year-ago period.

The board nod for the fundraise proposal came on a day when Lloyd Metals shares edged higher at the stock markets. The stock closed at ₹590.9 on the NSE, up 2.4% as against the previous day’s close.