DCM Nouvelle Limited has announced a significant investment in its subsidiary, DCM Nouvelle Specialty Chemicals Limited (DCMSCL), by subscribing to a rights issue. The company has invested a total of Rs. 32,0087,760 (approximately Thirty-two Crores and eighty-seven thousand seven hundred sixty only) to acquire an additional 1,07,41,200 fully paid-up equity shares of face value Rs. 10 each. This new investment has increased the stake of DCM Nouvelle Limited in DCMSCL from 82.90% to 87.08%.

This rights issue was completed in one or more tranches, offering an opportunity for DCM Nouvelle Limited to enhance its ownership in a subsidiary that specializes in specialty chemicals. The shares acquired rank pari-passu with the existing equity shares of DCMSCL.

Investment Details and Objectives

The purpose of this additional investment is aligned with general corporate goals aimed at enhancing the growth potential of DCMSCL, which operates in the specialty chemicals industry. This acquisition of further equity stake will provide DCM Nouvelle Limited with an additional revenue segment and create value for the parent company. The impact of this acquisition is expected to strengthen the financials of both companies and contribute to their long-term strategic growth.

The acquired shares are a cash consideration investment, with the subscription made at a premium of Rs. 19.80 per share over the face value of Rs. 10 per share. The total amount invested by DCM Nouvelle Limited in the rights issue reflects a strategic decision to strengthen its position in a growing sector. The acquisition has already been completed, with the shares issued and the investment confirmed.

Related Party Transaction

It is important to note that DCMSCL is a material subsidiary of DCM Nouvelle Limited, making this investment a related party transaction. However, the transaction has been conducted on an arm’s length basis, ensuring that there is no preferential treatment or conflicts of interest. Mr. Hemant Bharat Ram, the promoter of the company, is mentioned as a key figure with interest in the transaction, but it is noted that none of the promoter group or other group companies hold direct interest in the rights issue.

Company Background

DCM Nouvelle Specialty Chemicals Limited (DCMSCL) was incorporated on February 2, 2022, under the provisions of the Companies Act, 2013. The company is based in Delhi and operates a state-of-the-art manufacturing facility in Ujjain, Madhya Pradesh, focused on the production of specialty amines. With a manufacturing capacity of approximately 1500 MT per annum, DCMSCL’s plant is equipped with over 150 high-end machines, including hydrogenators, agitated nutsche filters, and distillation columns.

For the financial year 2023-2024 (up to September 30, 2024), DCMSCL reported a turnover of Rs. 754.37 Lakhs, showcasing its growing presence in the specialty chemicals sector. The company continues to focus on expanding its technological capabilities and meeting industry standards with the latest Environmental Technology Plants (ETPs) and warehousing systems.

DCMSCL has made significant strides in its sector, and the additional investment from DCM Nouvelle Limited is expected to further strengthen its position in the competitive specialty chemicals industry.

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