Smallcap stock below ₹20: Zee Media shares to be in focus on Wednesday after THIS fundraising announcement

Smallcap stock below ₹20: Shares of Zee Media Corporation Ltd will be in focus during the next market session on Wednesday, April 9, after the leading mass media and news broadcasting company announced earlier today that it will raise funds via foreign currency convertible bonds (FCCBs) on a private placement basis.

Zee Media Corporation announced that the opening of the issuance of FCCBs is set for today, i.e., April 8, 2025, and the conversion price is fixed at Rs. 13.50 per equity share (including equity premium of ₹12.50, based on the pricing formula.

Also Read: Dividend stocks: These 5 small-cap stocks have higher yields than bank FD, PPF interest rate

Zee Media said in a regulatory filing to the stock exchanges on Tuesday, "…We wish to inform that the Board of Directors of the company at its meeting held today i.e. April 8, 2025, have inter-alia, considered and approved:

1. Raising funds by issuance of five per cent coupon, unsecured, unlisted, Foreign Currency Convertible Bonds up to $465,90,000, with a maturity of 10 years on a private placement basis to UNICO Global Opportunities Fund Ltd and Sun India Opportunities Investing Fund ‘incorporated VCC sub-fund’, on terms and conditions as decided between the company and the Proposed Investors, as per the applicable ECB guidelines set forth by the Reserve Bank of India;

2. The opening of the issuance of FCCBs today, i.e., April 8, 2025; and

3. Fixing the conversion price at Rs. 13.50 per equity share (including equity premium of ₹12.50) based on the pricing formula as prescribed under the Issue of Foreign Currency Convertible Bonds and Ordinary Shares Scheme 1993.

Also Read: Over 8200% gain in 5 years! This multibagger small-cap stock zooms 16% to 7-week high. Here’s why

“We further wish to inform you that the ‘Relevant Date’ for the purpose of issuance of the FCCBs, in terms of ‘Issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme 1993’, is April 8, 2025. Accordingly, the ‘floor price’ in respect of the aforesaid issuance of FCCBs has been determined at Rs. 13.04 per equity share, based on the pricing formula as prescribed under Clause 5(4)(ca) of the FCCB Scheme,” said Zee.

Zee Media to raise funds via FCCBs: Key metrics

FCCBs up to USD 465,90,000 split into five series and the proceeds will be drawn in tranches. The type of issuance is an international offering on a private placement basis. According to Zee Media, FCCBs will not be listed on any of the stock exchanges (whether in India or abroad). The FCCBs which are proposed to be issued are in the nature of being optionally convertible bonds.

Also Read: 3,657% returns in 5 years! Small-cap multibagger stock eyes NSE listing, climbs 3% amid stock market crash

In case the option to convert the FCCBs into equity shares is exercised, the number of equity shares on a fully diluted basis will be 29,61,35,358 equity shares of Re 1 each of the company, at the conversion price of ₹13.50 per equity share. FCCBs are maturing in 10 years. A five per cent coupon is offered per annum.

Zee Media Share Price Trend

Shares of Zee Media tumbled 12 per cent in one month and 33 per cent year-to-date (YTD). Shares have plunged 45 per cent in the last six months. On Tuesday, shares of Zee Media Corp settled 6.38 per cent higher at ₹12.84 apiece on the BSE. The media company commands a market cap of ₹803.05 crore.

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts, consider individual risk tolerance, and conduct thorough research before making investment decisions, as market conditions can change rapidly, and individual circumstances may vary.