Threads of Opportunity—Bannari Amman Weaves In New Funding Plans

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Bannari Amman Spinning Mills Ltd (BSE: 532674 | NSE: BASML) has notified that its board will consider a proposal for fund raising as part of its ongoing effort to increase its financial levels and invest in future growth plans. The move comes as the company remains committed to operational efficiency and renewable energy integration.

1. Fundraising Under Consideration

The company is contemplating various fund-raising options, including a rights issue, to raise funds for working capital needs and strategic investments.
Previously, in a board resolution, Bannari Amman had sanctioned raising up to ₹500 million through rights issue, indicating a preference for shareholder-inclusive fund-raising mechanisms.

2. Strategic Context

Bannari Amman is a vertically integrated textile business, with the capability to produce cotton yarn, woven and knitted fabric, garments, and home textiles.
The firm is also turning green, with a recent board approval of a 9.74 MW captive solar power plant in Tamil Nadu, to source 65% of its power needs post-commissioning.

3. Financial Snapshot

During the quarter ending September 2024, the company registered a consolidated net profit of ₹11.7 million on revenues of ₹2.33 billion.
Bannari Amman remains focused on cost reduction and green operations in the face of an unfavorable macro environment.

Sources: Zerodha, Economic Times, Bannari Mills