Aditya Birla Capital Limited (ABCL) has invested ~₹300 crore in its wholly owned subsidiary, Aditya Birla Housing Finance Limited (ABHFL). This investment was made on a rights basis. Despite this investment, ABCL’s shareholding percentage in ABHFL remains unchanged at 100%.
Since ABHFL is a wholly owned subsidiary of ABCL, this transaction qualifies as a related party transaction. However, it has been carried out at arm’s length, ensuring fairness and compliance with regulations. The investment aims to support ABHFL’s growth and enhance its leverage ratio, which is essential for maintaining financial stability.
The investment was made entirely in cash. ABHFL issued new equity shares, which ABCL purchased, adding ~₹300 crore to ABHFL’s capital. The allotment of these shares was completed on March 10, 2025.
A rights issue is a way for a company to raise capital by offering additional shares to its existing shareholders rather than seeking outside investors. In this case, ABCL, as the sole shareholder, exercised its right to buy more shares in ABHFL, ensuring the subsidiary received the required funds for growth without diluting ownership.
A part of Grasim Industries Ltd, provides insurance, investments and financing services, including loans, mutual funds and corporate insurance, serving both Indian and global markets.
ABHFL, a wholly owned subsidiary of ABCL, specialises in housing finance solutions across India. ABCL’s recent investment aims to support its growth and stability.
As of March 11, 2025, at 10:00 AM, the shares of Aditya Birla Capital Ltd are trading at ₹156.90 per share, reflecting a loss of 0.73% from the previous day’s closing price. Over the past month, the stock has registered a loss of 2.09%. The stock’s 52-week high stands at ₹246.90 per share, while its low is ₹149.01 per share.
This investment strengthens ABHFL’s financial position while ensuring business continuity within the Aditya Birla Group. By leveraging a rights issue, ABCL secures growth funding without diluting ownership.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks, read all the related documents carefully before investing.
Published on: Mar 11, 2025, 2:31 PM IST
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