Shree Renuka Sugars’ board has approved the conversion of ₹573.65 million in loans to its wholly-owned subsidiary, KBK Chem-Engineering Private Limited, into equity. This conversion, through a rights issue, will strengthen KBK’s capital structure and reduce indebtedness. The decision was made during a board meeting held on November 6, 2025. The conversion will result in fully paid-up equity shares of KBK at a face value of ₹100 each.
KBK Loan Conversion
The Board of Directors at Shree Renuka Sugars has given the go-ahead for an investment involving the conversion of a loan extended to KBK Chem-Engineering Private Limited (KBK) into equity. KBK is a wholly-owned subsidiary of Shree Renuka Sugars. The meeting to approve this conversion was held on Thursday, November 6, 2025.
Financial Details of the Conversion
The total loan amount being converted to equity is ₹573.65 million, as of October 31, 2025. This amount will be converted into fully paid-up equity shares of KBK, with each share having a face value of ₹100, through a rights issue.
Rationale and Impact
This financial restructuring aims to strengthen KBK’s capital structure, reduce its indebtedness, and improve its overall profitability. The proposed conversion of loans into equity is also expected to facilitate deleveraging within KBK. There is no fresh infusion of capital as a part of this rights issue.
KBK Performance and Industry
KBK Chem-Engineering Private Limited operates in the Engineering sector. Its turnover for recent fiscal years includes:
- FY 2024-25: ₹1,270.47 Mn
- FY 2023-24: ₹2,448.99 Mn
- FY 2022-23: ₹4,599.39 Mn
Details of Share Acquisition
The acquisition cost is ₹2,302.69 per share (including a premium of ₹2,202.69 per share), totaling ₹57,36,50,738. The company is acquiring 2,49,122 Equity Shares, leading to 100% control of KBK. The conversion adheres to arm’s length principles.
Rights Issue Timeline
The rights issue will commence on November 8, 2025, and close on November 14, 2025.
Source: BSE
