RR Fincap Private Limited, a wholly owned subsidiary of RR Financial Consultants Limited (RRFCL), has announced a Rs. 3 crore rights issue aimed at meeting the Reserve Bank of India (RBI) compliance requirements. The company will issue 3,00,00,000 equity shares at Rs. 1 each, offering its existing shareholders the opportunity to subscribe at a 3:2 ratio (3 new shares for every 2 fully paid shares held). The acquisition falls within related party transactions as RRFCL owns 100% of RR Fincap Private Limited, with Mr. Rajat Prasad serving as its nominee director.

Objective and Impact of the Rights Issue

The primary objective behind this rights issue is to align RR Fincap Private Limited with RBI’s financial norms. The company operates as a General Finance Company, engaged in financial services, asset financing, and housing finance, among others. The fresh capital infusion will strengthen the company’s financial standing, ensuring it remains compliant with regulatory mandates.

Shareholding and Transaction Details

• Total shares issued: 3,00,00,000 equity shares

• Issue price per share: Rs. 1

• Subscription ratio: 3 new shares for every 2 fully paid shares held

• Total value of the rights issue: Rs. 3 crore

• Shareholding post-issue: RRFCL remains the sole owner with 100% stake

Industry Overview and Company Background

RR Fincap Private Limited was incorporated on January 14, 2009, and has its presence across India. According to its Memorandum of Association, the company engages in:

• Financial and asset financing services for shares, commodities, industrial machinery, vehicles, and real estate.

• Housing finance, including loans for residential properties, commercial spaces, hotels, and infrastructure development.

• Investment and general finance activities, supporting industrial and commercial undertakings.

Financial Performance

RR Fincap Private Limited has shown significant growth over the past three years:

• FY 2024 turnover: Rs. 83,23,495

• FY 2023 turnover: Rs. 5,00,939

• FY 2022 turnover: Rs. 4,88,232
  The steep increase in revenue in FY 2024 signals stronger business operations, making the Rs. 3 crore capital infusion a strategic move for further growth.

Regulatory and Approval Aspects

No additional regulatory approvals are required for this rights issue, as the company is already compliant with relevant norms. The completion timeline for the rights issue is set for March 27, 2025.

Investment Outlook

The rights issue presents a strategic opportunity for RRFCL and its shareholders, ensuring financial stability and compliance while maintaining full ownership. Investors in NBFCs and financial services may find this development relevant, given the company’s expanding operations and improved revenue figures.

Conclusion

As RR Fincap Private Limited strengthens its financial position, this rights issue is expected to play a crucial role in ensuring regulatory compliance and facilitating further growth in the financial services sector. For investors and stakeholders, the Rs. 3 crore capital infusion marks a strategic milestone in the company’s expansion.

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