Muthoot Finance Limited has made a significant update regarding its wholly-owned subsidiary, Muthoot Money Limited. The company recently completed the allotment of 3,30,578 equity shares to Muthoot Money Limited, marking the successful infusion of additional equity into the subsidiary. This decision is part of Muthoot Finance's broader strategy to strengthen the capital base and improve the capital adequacy ratio.

Key Objectives of the Equity Infusion

The primary objective of this equity infusion is to enhance the financial stability of Muthoot Money Limited by improving its capital adequacy ratio. The funds raised through this rights issue will be allocated towards funding the business operations, meeting general corporate purposes, and repaying existing loans. This move ensures that Muthoot Money can sustain and grow its operations, contributing to the long-term financial health of the company.

The infusion is in line with the Securities and Exchange Board of India (SEBI) regulations, with the necessary disclosures made under the applicable guidelines of the Listing Regulations. The update has been shared with the National Stock Exchange of India Ltd. (NSE), BSE Limited, and NSE IFSC Limited, marking the completion of the transaction.

Related Party Transaction and Shareholding

Since Muthoot Money Limited is a wholly owned subsidiary of Muthoot Finance, the equity infusion does not result in any change in the overall shareholding structure. Moreover, the transaction does not qualify as a related party transaction beyond the inherent relationship between the parent and subsidiary entities. The directors of Muthoot Finance Limited also serve as directors on the board of Muthoot Money Limited, maintaining the connection between the two entities.

Muthoot Money Limited: A Snapshot

Muthoot Money Limited is a Non-Banking Financial Company (NBFC), primarily focused on providing financial services. The company has shown significant growth over the last three years. In the financial year 2023-24, the turnover reached Rs. 1231.53 million, compared to Rs. 446.88 million in 2022-23, and Rs. 412.47 million in 2021-22. The company is based in Kerala, with operations spread across the country.

As part of its growth trajectory, Muthoot Money Limited continues to contribute to the financial sector by offering various services and improving its financial infrastructure through equity infusions. This move positions the company to further scale its operations and better serve its clients.

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