Scoobee Day Garments Greenlights Rs 500 Million Rights Issue To Fuel Expansion And Strengthen Capital Base

Scoobee Day Garments (India) Ltd has approved a rights issue for an amount not exceeding Rs 500 million, marking a strategic move to bolster its financial position and support future growth initiatives. The decision was finalized during the company’s board meeting held on August 12, 2025, and reflects Scoobee Day’s intent to raise equity capital from existing shareholders while maintaining ownership continuity.

 

Key Highlights From The Rights Issue Approval

- The board approved a rights issue of equity shares for an aggregate amount not exceeding Rs 500 million  

- The issue will be offered to eligible shareholders as of the record date, which will be announced shortly  

- The Draft Letter of Offer has been prepared and submitted to the stock exchanges for review  

- The proceeds will be used for working capital, debt repayment, and capacity expansion  

 

Strategic Objectives Behind The Capital Raise

- Scoobee Day aims to strengthen its balance sheet and reduce reliance on external borrowings  

- The capital infusion will support modernization of manufacturing facilities and adoption of sustainable textile technologies  

- The company is also exploring new product lines in activewear and eco-friendly garments to meet evolving consumer preferences  

- The rights issue ensures that existing shareholders retain proportionate ownership while enabling the company to raise funds efficiently  

 

Operational Performance And Financial Context

- Scoobee Day reported improved financial results for FY25, with revenue growth driven by domestic and export orders  

- The company’s net profit for the year ended March 31, 2025, showed a modest uptick, supported by cost optimization and higher capacity utilization  

- As of March 2025, the company’s outstanding borrowings stood at Rs 580 million, with a BB- credit rating from CRISIL  

- The rights issue is expected to improve interest coverage and liquidity ratios over the next two quarters  

 

Shareholder Engagement And Governance

- The board has committed to transparent communication and timely disclosures under SEBI’s Listing Obligations  

- Shareholders will vote on the rights issue proposal and related resolutions at the upcoming Annual General Meeting  

- The company has confirmed that none of its promoters or directors are classified as wilful defaulters or fraudulent borrowers by any regulatory authority  

- The rights issue will be listed on BSE, where Scoobee Day’s equity shares are currently traded  

 

Market Position And Expansion Plans

- Scoobee Day operates in the mid-tier garment segment, supplying to domestic retailers and international buyers  

- The company is expanding its footprint in Tier 2 cities and exploring e-commerce partnerships to boost direct-to-consumer sales  

- Investments in automation and digital inventory systems are underway to improve operational efficiency  

- The rights issue will also support hiring and training initiatives to scale production capacity in Kerala and Tamil Nadu  

 

Conclusion

Scoobee Day Garments’ approval of a Rs 500 million rights issue signals a proactive approach to capital management and strategic expansion. By tapping into shareholder equity, the company aims to reinforce its financial foundation while pursuing growth in product innovation, market reach, and operational excellence. As the textile industry evolves, Scoobee Day is positioning itself to meet demand with agility and resilience.

 

Sources: BSE India, Scoobee Day Garments Investor Filings, Economic Times, Moneycontrol.