This smallcap stock climbs 7% as board okays rights issue

Shares of smallcap Sadhana Nitro Chem Ltd climbed 7 per cent on Monday after the intermediate specialty chemicals firm okayed a proposal of Rs 49.95 crore rights issue. The company is looking to foray in to land green energy for self-consumption and is looking to set up a green hydrogen facility, based on a solar plant and wind farm with a capacity of 15MW-20MW.

The funds of the rights issue are proposed to be predominantly used for acquisition of a 126-acre land plot, which will be strategically employed for the establishment of both a solar power facility and a wind energy installation.

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"These sustainable energy sources will be harnessed to generate electricity, which, in turn, will be utilised for the production of green hydrogen via water electrolysis. This green energy expansion offers the company strategic advantage of backward integration, with control over its energy supply. Further, any surplus green hydrogen produced will be made available for sale to external parties," the company told BSE.

Following the development, the stock rose 6.86 per cent to close at Rs 94.85. The rights shares would be offered at Rs 121 per share (a premium of Rs. 120), and the company will look to raise up to a total of Rs 49.95 crore.

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Abhishek Javeri, MD, Sadhana Nitro Chem Ltd: "Green hydrogen facility is expected to yield substantial cost savings, significantly increasing our bottom line. Beyond financial gains, this expansion offers us a strategic advantage through backward integration, granting us greater control over our supply chain.”

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