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Shoppers Stop Rights Issue

05 Jan 2023

After going through a very successful IPO in the year 2005, Shoppers Stop Limited is on the news once again with a rights issue. Since this is a rights issue and not an IPO, only the existing equity shareholders of the company are allowed to participate. If you’re on the lookout for more details regarding the Shoppers Stop rights issue, here’s everything that you need to know.  

About the company 
Part of the K. Raheja Corp group, Shoppers Stop Limited is one of India’s leading retailers. The company enjoys a significant brand equity and is quite well-known across the various states of the country. Their retail product portfolio is large and includes both branded and private label apparel, perfumes, footwear, cosmetics, jewellery, and more.  

The company operates around 96 retail outlets across almost 44 cities in India including both metropolitan, Tier-II, and Tier-III cities. In addition to operating under the brand name ‘Shoppers Stop’, the company also has stores under the ‘Home Stop’ and ‘Crossword’ brand names as well. 

As of March 31, 2020, the company’s total assets stood at around Rs. 4,080.85 crores, with the revenue hovering around Rs. 3,498.11 crores.  

Shoppers Stop rights issue details
Now that you’re aware of the company, here’s a quick look at some of the important details of the Shoppers Stop rights issue including the Shoppers Stop rights issue date and the Shoppers Stop share price for this rights issue. 

Shoppers Stop rights issue date
The rights issue of Shoppers Stop shares opens up for subscription on November 27, 2020. The issue would continue to stay open for 14 days, after which it would officially come to a close on December 11, 2020. The last date for market renunciation of the rights issue has also been notified by the company as December 07, 2020.

Shoppers Stop rights issue size
Around 2,13,68,982 equity shares worth Rs. 299.17 crores would be issued to the existing shareholders of the company via this rights issue. 

The rights issue allotment ratio as specified by the company is 17:70. This effectively means that for every 70 shares owned, a shareholder can apply for 17 rights equity shares of the company. 

The record date as set by the company for this rights issue of Shoppers Stop shares is November 20, 2020. 

Shoppers Stop rights issue share price
Though the Shoppers Stop share price is just Rs. 5 per equity share at face value, the Shoppers Stop rights issue share price is set at Rs. 140 per equity share. This effectively means that around Rs. 135 per equity share would go to the company as share premium. 

Shoppers Stop rights issue listing 
Since the Shoppers Stop shares are already listed on both the National Stock Exchange (NSE) as well as the Bombay Stock Exchange (BSE), the rights equity shares would also automatically be listed on both the premier stock exchanges of the country. 

Shoppers Stop rights issue objectives
According to the final rights issue letter of offer filed by the company with the SEBI, the net proceeds from the said rights issue of Shoppers Stop shares is proposed to be used for the following objectives. 
●    The repayment / prepayment of certain working capital borrowings made by the company.
●    The funding of working capital requirements of the company. 
●    Other general corporate purposes.  

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