Sumeet Industries to raise ₹200 cr via rights issue

Sumeet Industries, a leading integrated polyester manufacturer, plans to raise Rs 200 crore through a rights issue aimed at enhancing financial flexibility and supporting the company’s strategic business priorities.

The Board of Directors of Sumeet Industries approved the terms of a rights issue aggregating to ₹200 crore through the issuance of ₹16.84 crore fully paid-up equity shares. The company is engaged in the production of Pet Chips, Partially Oriented Yarn (POY), Fully Drawn Yarn (FDY) and Polyester Texturized Yarn.

The company proposes to deploy ₹49 crore from the rights issue proceeds towards the acquisition and operationalisation of additional 140,000 tonne per annum Polyester Chips plant acquired from Nakoda in Surat, Gujarat.

The project involves a total capital outlay of ₹90 crore with the balance ₹41 crore being funded through internal accruals. The project is expected to be recommissioned in Q1 FY28. The facility will strengthen backward integration and support the company’s downstream polyester manufacturing operations.

The company will repay ₹23 crore debt and put up 6.5 MW solar power plant with an investment of Rs 22 crore. It will use Rs 100 crore for working capital.

The capital raised through the rights issue will support Sumeet Industries next phase of growth by strengthening working capital, accelerating the integration of acquired manufacturing assets, optimizing the capital structure through debt reduction, and enhancing energy security through a captive solar power facility. Pratik R Jaju, Managing Director, Sumeet Industries said the proposed fund raise will support key strategic priorities, including working capital requirements, integration of acquired manufacturing assets, debt reduction and investment in a captive solar power facility.

A key focus area will be the operationalisation of the recently acquired Polyester Chips manufacturing facility from Nakoda, which is expected to strengthen backward integration and enhance our integrated polyester value chain, he added.

Driven by the anticipated benefits of the acquisition and its integration, the company expects about 30 per cent growth in income in FY27, with EBITDA margins in the range of 5–6 per cent. With the successful integration of the acquisition, income is expected to nearly double in FY28, while EBITDA margins are expected to improve to 5.5–6.5 per cent, he said.