Siyaram Silk Mills Limited’s Scheme of Arrangement Sanctioned by NCLT; Bonus Issue Proposed to Shareholders
Siyaram Silk Mills Limited has received sanctioning for its Scheme of Arrangement from the National Company Law Tribunal (NCLT), allowing the company to proceed with issuing Preference Shares by way of bonus to its equity shareholders. The order, pronounced on July 21, 2026, grants approval to the scheme under Sections 230 and other applicable provisions of the Companies Act, 2013.The Scheme aims to optimally utilize substantial surplus reserves accumulated over the years by rewarding the company's shareholders. Siyaram Silk Mills Limited, which is engaged in the manufacturing, branding, and marketing of fabrics, readymade garments, and indigo dyed yarn, concluded that distributing a portion of these surplus funds was viable while maintaining sufficient cash resources to meet all liabilities towards lenders and other stakeholders.
The core component of the arrangement involves issuing two series of Preference Shares via bonus allotment:
- Preference Shares Series I: 4 shares of face value INR 10 each, for every 1 equity share of INR 2 each held by a shareholder. These shares are cumulative, non-convertible, and redeemable within three years from the date of allotment.
- Preference Shares Series II: 3 shares of face value INR 10 each, for every 1 equity share of INR 2 each held by a shareholder.
The company stated that this issuance of Preference Shares will act as a listed security, providing flexibility to both the equity shareholders and the company in managing its liquidity until redemption.
Key Details of the Bonus Issue
The structure of the bonus allotment is detailed below:| Series | Face Value per Share | Ratio (per 1 Equity Share) | Dividend Rate | Redemption Period |
|---|---|---|---|---|
| Series I | INR 10 | 4 shares | 9% per annum | Up to 3 years |
| Series II | INR 10 | 3 shares | 19% per annum | Up to 5 years |
Financial Snapshot and Capital Structure
The sanction of the Scheme provided clarity regarding the company's capital structure and the process for implementing the bonus issue.The share capital of Siyaram Silk Mills Limited, as reported prior to the scheme implementation, stood as follows:
| Share Category | Authorized Capital (Shares) | Face Value | Total Value |
|---|---|---|---|
| Equity Shares | 5,50,20,000 | INR 2 each | |
| Redeemable Preference Shares | 7,50,000 | INR 10 each | |
| Total Issued & Paid Up Capital | 4,53,70,088 (Equity) | INR 9,07,40,176 |
The company further confirmed compliance with necessary statutory requirements and committed to undertaking all required corporate steps to give effect to the Scheme.
SIYSIL Stock Price Movement
Shares of Siyaram Silk Mills Limited slipped by 0.74% in today's trading session, settling at ₹617.05. The stock traded within a range of ₹615 to ₹628.85 during the session, with a total volume of 17,623 shares recorded.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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