Apollo Micro Systems rallies 14% after boards approve issue of warrants

Shares of Apollo Micro Systems zoomed more than 14 per cent during the trading session on Friday after the company’s board okayed issue of warrants of up to Rs 185 crore.

In an exchange filing, the aerospace and defence company said its board has approved the issue of warrants to promoters and non-promoter group personnel on a preferential basis.

According to the filing, the company board has approved to issue 1,01,00,070 warrants at a price of Rs 183.30 aggregating up to Rs 185.13 crore to its various shareholders.

The company will allot 46.2 lakh warrants to Karunakar Reddy Baddam, promoter and Managing Director of the company. It said it will issue 19 lakh warrants to Nexpact, Mauritius and 12 lakh warrants to Maybank Securities.

Following the announcement, shares of Apollo Micro Systems surged more than 14 per cent to Rs 247.45, before giving up partial gains. The scrip settled the previous session at Rs 216.40.

Each of the aforementioned warrants, are convertible into, or exchangeable for, one equity share within the period of 18 months, the company said.

Upon issue of warrants, an amount equivalent to 25 per cent of the total issue size shall be called upfront from the proposed allottees.

The company will host its extraordinary general meeting (EGM) on November 12 to seek shareholders’ approval for the issuance of the warrants.

Apollo Microsystems is an electronic, electro-mechanical, engineering designs, manufacturing and supplies company, whose shares have delivered an up to 60 per cent return in the last six months.

It is involved in the design, development and sale of high-performance, mission and time critical solutions to defence, space and homeland security of the defence ministry, government-controlled public sector undertakings, and private sectors.

Apollo Micro Systems' clientele include Bharat Dynamics, Bharat Electronics, Defence Research and Development Organisation (DRDO) among others.