InvestorQ : Will the latest fund raising by Piramal Enterprise adversely impact its debt/equity ratio?
prachi Patwardhan made post

Will the latest fund raising by Piramal Enterprise adversely impact its debt/equity ratio?

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sara Kunju answered.
3 weeks ago
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The finds are being raised by Piramal Capital, which is the financial subsidiary of Piramal Enterprises Ltd. Piramal Capital has raised Rs.4,050 crore as debt through the issue of non-convertible debentures or NCDs. The instrument is a 5-year NCDs which will be used to partially fund the buyout of Dewan Housing.

In addition, Piramal will also look at these funds to transform the liabilities profile towards stable and long-term funds. Even after the funds are raised through debt, the debt/equity ratio of the group will be less than 1 so it is hardly a matter of any concern at this point of time. That is because, there has been substantial equity raising also done by the group.

For example, from April 2019 Piramal has raised Rs.50,000 crore including Rs.18,000 crore via equity transactions. This was raised through various modes like the preferential allotment to CDPQ of Canada, the rights issue of Rs.3,650 crore as well as hiving off its healthcare analytics subsidiary DRG for Rs.6,950 crore. In addition, Piramal Enterprises also monetized its Shriram Transport Finance stake and also got infusion of funds from Carlyle PE.
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