Bharat Bhushan Share BSE RI review - (May apply)

•    The company is engaged in securities trading, investment and lending business.
•    It marked minuscule profits for FY23 to FY24 and posted loss for FY25.
•    The RI is at par value with a discount of around 73.28% based on its ongoing market price.
•    It is operating in a highly competitive and fragmented segment.
•    Well-informed investors may park moderate funds for medium term.

PREFACE:
The company is coming out with its RI to mobilize Rs. 3.38 cr., and is opening for subscription on June 16, 2025, and its offer document is dated June 02, 2025, with a record date was of May 30, 2025, but the offer document was not uploaded on the designated exchange till noon of June 11, 2025. Thus, delayed submission of offer documents for RI is unabatedly going on.

ABOUT COMPANY:
Bharat Bhushan Share and Commodity Brokers Ltd. (BBSCBL) is engaged in broking, lending and investment activities. The Company was incorporated in June 1992 and commenced its operations by investment and trading in securities. The Company came out with public issue of Equity shares in May 1994. The company also obtained merchant banking license from Securities and Exchange Board of India (SEBI) on 1st July 1994. During this period, the company acted as lead managers, co-managers, & advisors to various public issues. However, in 1997 the company did not renew its merchant banking license in view of enhanced net worth requirements.

The company took a membership in National Commodity & Derivatives Exchange Limited (NCDEX) in December 2003, Multi Commodity Exchange of India Limited (MCX) in March 2008, and National Spot Exchange Limited (NSEL) in June 2011. The company surrendered its NCDEX Membership as they were largely in agricultural commodities for which the company clients lacked interest. It continued the NSEL operation till July 2013 & MCX operation till November 2015. The company later on decided to completely shut down the commodity broking operations in November 2015. 

The Company also obtained RBI registration as NBFC in December 2010 under section 45-IA of The Reserve Bank of India Act, 1934 ("RBI") as non-Systematically important non-Deposit taking Company categorized as Investment and Credit Company i.e., ICC. It is primarily engaged in the business of equity and debt investment, trading in securities and financing to individuals and small businesses. With the experience of its team, the company has been able to continuously identify prospective investor opportunity. The Company’s product offering includes Loans against securities, inter corporate
deposits and distribution in marketing of third-party financial report. As of May 30, 2025, it had just 5 employees on its payroll.

ISSUE DETAILS:
The company is coming out with its Rights Issue (RI) of 3380400 equity shares of Rs, 10 each at par value to mobilize Rs. 3.38 cr. The RI is opening for subscription on June 16, 2025, and will close on July 07, 2025. The company is offering RI in the ratio of 1 for 1 to its eligible stakeholders as of the record date of May 30, 2025. The company is asking for full money on application for number of shares applied. Post allotment, shares will be listed on BSE. The company is spending Rs. 0.27 cr. for this RI process, and from the net proceeds, it will utilize Rs. 2.75 cr. for augmenting its capital base, and Rs. 0.36 cr. for general corporate purposes. 

The RI is solely lead managed by SPA Capital Advisors Ltd., and Alankit Assignments Ltd. is the registrar to the issue. 

Post RI, company’s current paid-up equity capital of Rs. 3.38 cr. will stand enhanced to Rs. 6.76 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 6.76 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, it has posted a total income/ net profit/ - (loss) of Rs. 0.58 cr. / Rs. 0.12 cr. (FY23), Rs. 0.71 cr. / Rs. 0.22 cr. (FY24), Rs. 0.29 cr. / Rs. – (0.13) cr. (FY25).  Thus, it marked minuscule profits for FY23 and FY24, but posted loss for FY25.

DIVIDEND POLICY:
The company has paid a dividend of 6% each year for the reported periods. It will adopt a prudent dividend policy post listings of RI shares based on its financial performance and future prospects. 

SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 511501 (FV Rs. 10).
The scrip last closed on cum-right basis at Rs. 74.10 on May 29, 2025, and opened on an ex-right basis at Rs. 39.91 on May 30, 2025. Since then, it has marked a high/low of Rs. 43.88 / Rs. 36.00. The scrip last closed at Rs. 37.42 as of June 13, 2025. For the last 52 weeks’ it has posted a high/low of Rs. 44.37 / Rs. 19.85. The counter is currently under ESM: Stage 1.

The promoters’ holding has been constant around 54.36% for the last two quarters ended with March 31, 2025. The counter is well managed above the par value to lure investors.