Fluorination Capabilities Of Deepak Nitrite Enhanced With ₹176 Crore Preference Allotment In Deepak Chem Tech
By Ankur Chandra | Updated at: Jun 7, 2025 12:08 AM IST
Vadodara, June 6, 2025 — Deepak Nitrite Ltd (NSE: DEEPAKNTR) has injected ₹176 crore into its wholly owned subsidiary Deepak Chem Tech Ltd (DCTL), through the issue of Optionally Convertible Redeemable Preference Shares (OCRPS). This move is seen as an attempt to strengthen the group’s internal capital ecosystem, and the funding was routed through another group subsidiary, Deepak Phenolics Ltd (DPL).
The allotment will be a critical step towards strengthening the fluorination capabilities of the company and enhancing vertical integration. In the long term, this will help in improved market positioning and capital structure for the entire group.
Deepak Nitrite’s share corrected a little over 2% on Friday.
Investment Overview
In a regulatory filing under SEBI LODR norms, Deepak Nitrite disclosed that DCTL allotted 1.76 crore OCRPS at a face value of ₹100 each, fully subscribed by DPL. This related party transaction was executed on an arm’s length basis, and the consideration was settled in cash through regular banking channels.
| Particulars | Details |
|---|---|
| Entity Receiving Investment | Deepak Chem Tech Ltd (DCTL) |
| Investor Entity | Deepak Phenolics Ltd (DPL) |
| Amount Invested | ₹176 crore |
| Instrument | 9% Optionally Convertible Redeemable Preference Shares (OCRPS) |
| Price per Share | ₹100 (at par) |
| Nature of Transaction | Related Party, Arm’s Length |
| Date of Allotment | June 6, 2025 |
About Deepak Chem Tech Ltd
DCTL, incorporated on October 9, 2020, spearheads Deepak Nitrite’s expansion into advanced chemical segments. The company operates a state-of-the-art fluorination plant in Gujarat, launched on March 21, 2024, and is actively working on multiple project sites across the state.
Financial Highlights (Standalone Turnover)
| Financial Year | Turnover (₹ Crore) |
|---|---|
| FY25 | 9.43 |
| FY24 | 0.86 |
| FY23 | NA |
This investment brings DCTL’s total paid-up capital to ₹1,199.50 crore, comprising ₹499.50 crore in equity and ₹700 crore in preference shares (excluding the current allotment).
Strategic Rationale
The capital infusion aims to:
- Enhance DCTL’s capital base
- Support ongoing project-related expenditure
- Facilitate repayment of existing loans
As per the disclosure, DCTL’s activities are within the core business focus of the group.
Shareholding Structure
Despite the intra-group movement of funds and shares, Deepak Nitrite Ltd retains 100% ownership of DCTL’s equity, and alongside DPL, indirectly controls the entirety of its preference capital. As all the entities are from the same corporate group structure, no government or regulatory approvals were needed for this transaction.
REF: https://nsearchives.nseindia.com/corporate/DEEPAKNTR_06062025141700_NSE06062025.pdf
Disclaimer: At HDFC SKY, we take utmost care and due diligence in curating and presenting news and market-related content. However, inadvertent errors or omissions may occasionally occur.
If you have any concerns, questions, or wish to point out any discrepancies in our content, please feel free to write to us at content@hdfcsec.com.
Please note that the information shared is intended solely for informational purposes and does not make any investment recommendations
