Tunwal E-Motors Limited, a leading electric vehicle (EV) manufacturer in India, has successfully acquired 95,850 fully paid-up equity shares of Palsana EV Industries (India) Private Limited through a Preferential Allotment. This acquisition has been carried out through a combination of conversion of an outstanding unsecured loan and the fresh issuance of equity shares to support the business expansion of its wholly owned subsidiary.

Board Approval and Allotment Details

The Board Meeting of Palsana EV Industries (India) Private Limited was held on 29th March 2025, where the decision to allot equity shares to Tunwal E-Motors Limited was approved. The acquisition was undertaken under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI LODR), ensuring compliance with SEBI Circular No. SEBI/HO/CFD/CFD-PoD-1/P/CIR/2023/123 dated July 13, 2023, and SEBI Master Circular No. SEBI/HO/CFD/PoD2/CIR/P/2023/120 dated July 11, 2023.

Key Financial Aspects of the Acquisition

The acquisition involves a total investment of Rs. 4,85,00,100/- (Four Crore Eighty-Five Lakh One Hundred Only), which includes:

• Rs. 1,98,61,512/- (One Crore Ninety-Eight Lakh Sixty-One Thousand Five Hundred Twelve Only) through a fresh issue of equity shares.

• Rs. 2,86,38,588/- (Two Crore Eighty-Six Lakh Thirty-Eight Thousand Five Hundred Eighty-Eight Only) through the conversion of an outstanding unsecured loan of Rs. 2,86,39,055/- as of 31st January 2025.

Nature of Transaction and Related Party Details

As Palsana EV Industries (India) Private Limited is a wholly owned subsidiary of Tunwal E-Motors Limited, this acquisition falls within the purview of related party transactions and has been conducted at arm’s length. Several key promoters and directors have a vested interest in this transaction:

• Mr. Amit Kumar Pannaram Mali (Promoter) and Mr. Karan Kumar Saini, who serve as Whole-Time Directors in the parent company, are also directors of the wholly owned subsidiary.

• Mr. Jhumarmal Tunwal (Promoter and Managing Director) holds one share as a nominee shareholder in Palsana EV Industries (India) Private Limited.

Purpose and Rationale Behind the Acquisition

The acquisition aims to enhance the financial standing and working capital of Palsana EV Industries. The subsidiary, which operates in the manufacturing sector for electric mobility vehicles, is in need of additional funds to strengthen its financial position and meet capital expenditure requirements.

By converting the outstanding unsecured loan into equity shares and issuing fresh shares, Palsana EV Industries aims to:

• Strengthen its working capital position.

• Enhance its financial ratios to meet banking requirements.

• Support capital expenditure and business expansion.

This preferential allotment is expected to significantly boost the net worth of the subsidiary, allowing it to maximize revenue opportunities and expand its business operations in the highly competitive electric vehicle industry.

Background and Business of Palsana EV Industries

Palsana EV Industries (India) Private Limited, formerly known as ASG Mart India Private Limited, is engaged in the design, development, manufacturing, assembly, and sale of electric vehicles (EVs), including but not limited to:

• Electric cars

• Electric motorcycles

• Electric buses and trucks

• Electric wheelchairs and bicycles

The company has a strong presence in India and is committed to advancing e-mobility solutions to reduce carbon emissions and promote sustainable transportation.

Change in Share Capital Post Allotment

As of 29th March 2025, the issued, subscribed, and paid-up share capital of Palsana EV Industries (India) Private Limited stood at INR 10,00,000, divided into 1,00,000 equity shares of face value of INR 10 each. After the preferential allotment, the authorized, issued, subscribed, and paid-up share capital of the company will be increased to reflect the new equity issuance and loan conversion.

Regulatory and Governmental Approvals

The acquisition of Palsana EV Industries does not require any governmental or regulatory approvals, ensuring a smooth and expedited process for the preferential allotment.

Timeline and Completion of Acquisition

The acquisition has been completed on 29th March 2025, marking a strategic move by Tunwal E-Motors Limited to strengthen its subsidiary and align with its long-term growth strategy in the electric vehicle industry.

Impact on Tunwal E-Motors Limited

With this acquisition, Tunwal E-Motors Limited aims to:

• Expand its product portfolio in the EV segment.

• Strengthen its market position through increased capacity and production.

• Unlock new growth opportunities by leveraging the expertise of its subsidiary.

Conclusion

The acquisition of Palsana EV Industries (India) Private Limited by Tunwal E-Motors Limited marks a significant milestone in the company's journey towards becoming a leader in the electric vehicle space. Through this preferential allotment, the company not only strengthens the financial health of its subsidiary but also positions itself for sustainable growth and market leadership in the rapidly evolving EV industry.

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