December 9, 2022
EGM Transcript 09.12.2022
Our analyst
Read of this earnings call — headline is the investment verdict. Research synthesis, not investment advice.
No-conviction:
this EGM authorizes a preferential issue of up to 565,000 shares at ₹700 each, potentially raising ₹39.55 crore, for working capital, dredging/small-craft capex, expansion and general corporate purposes. The capital raise supports fleet and project growth, but the meeting provided no earnings, project backlog, return-on-capital, investor-identity or dilution detail, and there was no shareholder Q&A.
- Preferential Allotment
- Capital Raise
- Dredging Projects
- Small Craft Projects
- Working Capital
- Capex
- Business Expansion
Near term
- Completion of the preferential allotment within 15 days of shareholder approval and disclosure of the final allottee list.
- Deployment of the approximately ₹39.55 crore proceeds into working capital, fixed assets and new dredging or small-craft projects.
- Potential dilution and market reaction to the ₹700 issue price relative to the prevailing share price.
Longer term
- Whether the new dredging and small-craft assets generate attractive utilization, margins and returns on capital.
- Execution of the stated business-expansion plans and the company’s ability to convert incremental working capital into revenue and cash flow.
- Future equity raises or leverage requirements if fleet expansion and working-capital needs exceed the proceeds.
Red flags
- Proceeds are only broadly allocated across working capital, capex, expansion and general corporate purposes; no project-level economics, timelines or expected returns were provided.
- The proposed investors were described only as selected non-promoter strategic investors; no names, commitments or strategic rationale were disclosed in the meeting.
- There was no operating or financial update and no analyst or shareholder challenge because no speaker shareholders were registered.
- The issue price was said to comply with SEBI guidelines, but the transcript does not establish whether ₹700 represents an attractive valuation or creates meaningful dilution risk.
Knowledge Marine & Engineering Works Limited
Knowledge Marine & Engineering Works Limited
Extra-ordinary General Meeting
FY 22-23
December 9th ,2022.
1 | Knowledge Marine & Engineering Works Limited
Knowledge Marine & Engineering Works Limited
EBVTT
1 "Moderator LinkIntime" (2248531712)
00:00:09.989 --> 00:00:13.529
So, we are live now you may start the meeting.
2 "Ritika Sharma" (2881078272)
00:00:15.329 --> 00:00:25.740
Dear members. Good evening. I ritika Sharma company secretary compliance officer of the company. Welcome you all to the EGM of knowledge. Marine and engineering works limited.
3 "Ritika Sharma" (2881078272)
00:00:25.740 --> 00:00:36.570
Hope you all are in good health. I would like to inform you that this meeting is being held through video conferencing in accordance with the circulars issued by the ministry of corporate affairs and SEBI.
4 "Ritika Sharma" (2881078272)
00:00:36.570 --> 00:00:44.190
The facility for joining the EGM through video conferencing and other audio visual means is made available for members.
5 "Ritika Sharma" (2881078272)
00:00:44.190 --> 00:00:47.940
All the members who have joined the meeting are by defaults placed on mute.
6 "Ritika Sharma" (2881078272)
00:00:47.940 --> 00:00:53.340
To avoid disturbance arising from the background noise to ensure that the meeting is connected smoothly.
7 "Ritika Sharma" (2881078272)
00:00:53.340 --> 00:00:57.120
I would now like to introduce the panel members present today.
8 "Ritika Sharma" (2881078272)
00:00:57.120 --> 00:01:01.860
We have with us Mr. Saurabh Daswani managing director from Mumbai.
9 "Ritika Sharma" (2881078272)
00:01:01.860 --> 00:01:06.810
Next we have, whith us Mrs. Kanak Kewalramani, director and CFO.
10 "Ritika Sharma" (2881078272)
00:01:06.810 --> 00:01:11.640
We also have with us miss pretty p singhania from her office in mumbai.
11 "Ritika Sharma" (2881078272)
00:01:11.640 --> 00:01:18.840
For E, voting from M/s preeti p singhania and company practicing charter accountants who's joining us from her office In Mumbai
12 "Ritika Sharma" (2881078272)
00:01:18.840 --> 00:01:25.590
I would like to inform that we have the requisite quoram for the meeting as confirmed by the moderators.
13 "Ritika Sharma" (2881078272)
00:01:25.590 --> 00:01:28.980
So, can we call the meeting to order saurabh, sir?
14 "Ritika Sharma" (2881078272)
00:01:28.980 --> 00:01:33.000
Yeah, sure the EGM is now placed to order.
15 "Ritika Sharma" (2881078272)
00:01:33.000 --> 00:01:42.000
I now request Mr, Saurabh daswani managing director and chairman of this meeting to comment on today's agenda for the meeting that is preferential allotment.
16 "Ritika Sharma" (2881078272)
00:01:42.000 --> 00:01:45.810
2 | Knowledge Marine & Engineering Works Limited
Knowledge Marine & Engineering Works Limited
Of equity shares, resulting in increase and authorized capital.
17 "Ritika Sharma" (2881078272)
00:01:45.810 --> 00:01:50.100
Of company and alteration of capital clause of MOA. over to you sir.
18 "Saurabh Daswani" (3019313920)
00:01:51.360 --> 00:01:55.800
Thanks for the shareholders. Good evening.
19 "Saurabh Daswani" (3019313920)
00:01:55.800 --> 00:02:04.470
Hope you all are keeping good health as detailed in our f, y23 earnings call and considering the future growth potential.
20 "Saurabh Daswani" (3019313920)
00:02:04.470 --> 00:02:17.700
And expansion plans of the business, and to consistently invest in acquiring new fixed assets and augmenting working capital, the board proposed to approve the plan to issue additional equity shares.
21 "Saurabh Daswani" (3019313920)
00:02:17.700 --> 00:02:21.720
On preferential basis to certain strategic investors.
22 "Saurabh Daswani" (3019313920)
00:02:21.720 --> 00:02:26.100
This will help us to capitalize any immediate opportunity.
23 "Saurabh Daswani" (3019313920)
00:02:26.100 --> 00:02:31.500
That may arise in the company, the object of raising the equity share capital is.
24 "Saurabh Daswani" (3019313920)
00:02:31.500 --> 00:02:34.890
Number 1, to me, working capital requirements.
25 "Saurabh Daswani" (3019313920)
00:02:34.890 --> 00:02:42.600
Number 2, funding of capital expenditure and purchase of fixed assets for several new dredging and small craft projects.
26 "Saurabh Daswani" (3019313920)
00:02:42.600 --> 00:02:48.060
Number 3, business, expansion and growth and number 4, general, corporate purpose.
27 "Saurabh Daswani" (3019313920)
00:02:48.060 --> 00:02:53.310
Currently, our authorized capital is rupees. 10.5.cr.
28 "Saurabh Daswani" (3019313920)
00:02:53.310 --> 00:02:56.820
Divided into 1.05 crores equity shares.
29 "Saurabh Daswani" (3019313920)
00:02:56.820 --> 00:03:00.870
Of face value of 10 each and paid up share capital.
30 "Saurabh Daswani" (3019313920)
00:03:00.870 --> 00:03:05.550
Of rupees, 10.24 crores hence it is proposed.
31 "Saurabh Daswani" (3019313920)
00:03:05.550 --> 00:03:09.120
To increase the authorized share capital to rupees 11 Crores.
32 "Saurabh Daswani" (3019313920)
00:03:09.120 --> 00:03:12.540
Through issuance of additional five lakhs equity shares.
33 "Saurabh Daswani" (3019313920)
00:03:12.540 --> 00:03:16.470
Of face, value, rupees, 10 each accordingly.
3 | Knowledge Marine & Engineering Works Limited
Knowledge Marine & Engineering Works Limited
34 "Saurabh Daswani" (3019313920)
00:03:16.470 --> 00:03:26.370
The board has resolved to offer allot and issue up to 5.65, lakh equity shares of face value rupees, 10 each.
35 "Saurabh Daswani" (3019313920)
00:03:26.370 --> 00:03:29.520
Each to selected non promoter strategic investors.
36 "Saurabh Daswani" (3019313920)
00:03:29.520 --> 00:03:33.420
At an issue price of Rs, 700 per equity shares.
37 "Saurabh Daswani" (3019313920)
00:03:33.420 --> 00:03:36.540
Including a premium of rs 690.
38 "Saurabh Daswani" (3019313920)
00:03:36.540 --> 00:03:40.950
The issue price is calculated as per sebi guidelines.
39 "Saurabh Daswani" (3019313920)
00:03:40.950 --> 00:03:44.580
And it's not less than the floor price computed.
40 "Saurabh Daswani" (3019313920)
00:03:44.580 --> 00:03:49.260
The company needs to complete the allotment of equity shares.
41 "Saurabh Daswani" (3019313920)
00:03:49.260 --> 00:03:58.170
Or before the expiry of 15 days, from the date of passing of this resolution, by the shareholders granting consent for the issue.
42 "Saurabh Daswani" (3019313920)
00:03:58.170 --> 00:04:01.770
The increase in the authorized share capital.
43 "Saurabh Daswani" (3019313920)
00:04:01.770 --> 00:04:09.870
As aforesaid ,would entail consequential alteration of the existing clause of the memorandum of association of the company.
44 "Saurabh Daswani" (3019313920)
00:04:09.870 --> 00:04:16.740
Necessary arrangements have been made for remote voting and also E voting during this meeting.
45 "Saurabh Daswani" (3019313920)
00:04:16.740 --> 00:04:23.310
Thank you for your patience and I look forward to your unanimous support in passing of this resolution.
46 "Saurabh Daswani" (3019313920)
00:04:23.310 --> 00:04:24.205
What do you pick up?
47 "Ritika Sharma" (2881078272)
00:04:25.015 --> 00:04:25.405
Thank you,
48 "Ritika Sharma" (2881078272)
00:04:25.405 --> 00:04:40.405 sir in compliance with relevant provisions of the companies that 2013 rules made thereunder and SEBI LODR the company has provided the facility to members to exercise their right to vote on the
49 "Ritika Sharma" (2881078272)
00:04:40.405 --> 00:04:43.465 business proposed to be transacted at this EGM
50 "Ritika Sharma" (2881078272)
00:04:44.904 --> 00:04:59.394
4 | Knowledge Marine & Engineering Works Limited
Knowledge Marine & Engineering Works Limited
Through Remote E, voting for a period commencing from 6th of December,
2022 9 am to 8th of December, 2022, 5 PM in order to facilitate voting to those members who have not casted their votes through remote e voting. The company has also provided the facility to vote at this EGM.
51 "Ritika Sharma" (2881078272)
00:04:59.574 --> 00:05:06.624
Through the voting platform of LinkedIn time, India, private limited. at this the voting platform of linkedin time india private limited
52 "Ritika Sharma" (2881078272)
00:05:06.929 --> 00:05:10.859
M/s. Preeti P Singhania and company, chartered accountants.
53 "Ritika Sharma" (2881078272)
00:05:11.394 --> 00:05:24.534
Has been appointed as the scrutinizers for remote voting as well as E voting at the EGM who will scrutinize the votes and hand over the combined report on voting within 48 hours of the conclusion of the meeting upon receipt of the same
54 "Ritika Sharma" (2881078272)
00:05:24.534 --> 00:05:29.274
And the same shall be uploaded on the website of the company and on the stock exchanges. exchanges
55 "Ritika Sharma" (2881078272)
00:05:30.234 --> 00:05:44.994
The notice of EGM along, with explanation statement have been sent by electronic mode to those members whose email addresses are registered w with the company and depositories the documents have also been made available on the company's website.
56 "Ritika Sharma" (2881078272)
00:05:45.204 --> 00:05:50.994 www.kmew.in, considering the above the notice has been taken as read.
57 "Ritika Sharma" (2881078272)
00:05:53.189 --> 00:05:59.939
In terms of the notice of the, the following items of business are to be transacted and considered in this meeting.
58 "Ritika Sharma" (2881078272)
00:05:59.939 --> 00:06:05.189 to offer, issue, allot equity shared on preferential basis.
59 "Ritika Sharma" (2881078272)
00:06:05.189 --> 00:06:17.459
To increase the authorized share capital of the company, resulting in, the alteration of MOA. The text of the resolutions along with explanation statement is provided in the notice circulated to the members.
60 "Ritika Sharma" (2881078272)
00:06:17.459 --> 00:06:27.869
And members, may also note that E voting will be available for a period of
15 minutes after the conclusion of the EGM to enable the members who have not yet casted their votes at the meeting.
61 "Ritika Sharma" (2881078272)
00:06:27.869 --> 00:06:35.279
Therefore, I request the members who have not casted their votes to remote voting. May cast their votes after the meeting is concluded.
62 "Ritika Sharma" (2881078272)
00:06:35.279 --> 00:06:46.289
I would now request Mr Ashish, who is also the moderator from LinkedIn time, India, private limited to go over the instructions and call speaker shareholders registered if any.
63 "Moderator LinkIntime" (2248531712)
00:06:46.289 --> 00:06:54.419
5 | Knowledge Marine & Engineering Works Limited
Knowledge Marine & Engineering Works Limited
Ashish over to you, thank you, mam as we don't have any speaker shareholder registered for the meeting. So we may proceed further.
64 "Ritika Sharma" (2881078272)
00:06:54.419 --> 00:06:58.259
All right Thank you.
65 "Ritika Sharma" (2881078272)
00:06:58.259 --> 00:07:06.749
There being no speaker shareholder as confirmed by the moderator and there being no other business. I now declare the meeting to be closed.
66 "Ritika Sharma" (2881078272)
00:07:06.749 --> 00:07:20.639
All the members may please note that, after the conclusion of the meeting, the voting lines will be open for a period of 15 minutes. I thank all the shareholders, all the board of directors, and all the panel members who are attending the meeting today.
67 "Ritika Sharma" (2881078272)
00:07:20.639 --> 00:07:25.259
Thank you have a nice day. Thank you.
68 "preeti singhania" (2120258304)
00:07:27.929 --> 00:07:29.568
Thank you.
6 | Knowledge Marine & Engineering Works Limited