• The company was originally incorporated as a textile manufacturing unit, and has off-late diversified in to Hospitality and Real Estate segment.
• The company posted growth in its top and bottom lines, but on a minuscule level.
• The RI at par value appears fully priced, and is a risky bet considering its non-core area diversifications.
• Seven-fold rise in its post-RI paid-up equity capital may have its servicing issue.
• There is no harm in skipping this “High Risk/No Return” bet.
ABOUT COMPANY:
Gujarat Cotex Ltd., (GCL) is a dynamic enterprise at the forefront of multiple industries, driven by a commitment to quality, innovation, and sustainable growth. Its current operations span the Hospitality, Textile, and Real Estate sectors, where the company excels in delivering exceptional services and products that enhance the experiences of clients and communities.
Driven by a commitment to excellence, GCL emphasizes stringent quality control, sustainable sourcing of raw materials, and environmentally responsible production processes. It aspires to set new benchmarks in the edible oil industry by offering a diverse range of oils that combine tradition with innovation. Through this initiative, it is not just creating a product line—but nurturing a vision of wellness and sustainability for families and communities across the nation.
The company which was primarily in to textile segment is now diversifying in non-core businesses like hospitality and real estate. The offer document is silent on its employees’ strength data.
ISSUE DETAILS:
The company is coming out with its Rights Issue (RI) of 85464000 equity shares of Rs. 5 each at par value to mobilize Rs. 42.73 cr. The RI opens for subscription on April 10, 2026, and will close on May 08, 2026. The company is offering RI in the ratio of 6 for 1 to its eligible stakeholders as of the record date of April 01, 2026. The company is asking for full money on application for number of shares applied. Post allotment, RI shares will be listed on BSE and NSE. The company is spending Rs. 1.00 cr. for this RI process, and from the net proceeds, it will utilize Rs. 9.60 cr. for completing hotel construction, Rs. 2.14 cr. for purchase of new registered office, Rs. 19.31 cr. for working capital, and Rs. 10.68 cr. for general corporate purposes.
The RI is solely lead managed by the company itself, and Purva Sharegistry (India) Pvt. Ltd. is the registrar to the issue.
Post-RI, company’s current paid-up equity capital of Rs. 7.12 cr. will stand enhanced to Rs. 49.85 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 49.85 cr.
The offer document is dated March 24, 2026, and the RI issue ad was released in media only on April 06, 2026, but the offer document was uploaded only post noon of April 08, 2026 on company’s website. This indicates the serious draw back on company’s part in public information.
FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has posted total income / net profit, of Rs. 16.64 cr. / Rs. 0.01 cr. (FY23), Rs. 16.91 cr. / Rs. 0.19 cr. (FY24), Rs. 27.31 cr. / Rs. 0.22 cr. (FY25). For 9M of FY26 ended on December 31, 2025, it posted a net profit of Rs. 0.83 cr. on a total income of Rs. 30.06 cr. Its NAV stood at Rs. 5.40 as of December 31, 2025. As per reports, it has just cleared back-log of losses for 9M-FY26, and has posted minuscule bottom lines. Seven fold paid-up equity capital post RI may face its servicing issue.
DIVIDEND POLICY:
The company has not paid any dividends for the reported periods of the offer document. It will adopt a prudent dividend policy, based on its financial performance and future prospects. The offer document is silent on its dividend policy.
SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 514386 (FV Rs. 5).
The scrip last closed on cum-right basis at Rs. 8.72 on March 27, 2026, and opened on an ex-right basis at Rs. 5.70 on March 30, 2026. Since then, it has marked a high/low of Rs. 7.90 / Rs. 5.70. The scrip last closed at Rs. 7.40 as of April 06, 2026. For the last 52 weeks’ it has posted a high/low of Rs. 8.51 / Rs. 4.26. The counter is currently under ASM LT: Stage 1.
The promoters’ holding has been constant at 11.46% for the last three quarters ended with December 31, 2025. The counter is currently trading above the RI price with vested interest operators’ game. Though it was earlier listed on BSE and NSE, there are no trades taking place on NSE, which is a big surprise.
Review By Dilip Davda on April 8, 2026
Dilip Davda is a veteran financial journalist associated with the Indian stock market since 1978. He has been contributing to print and electronic media on capital markets, insurance, and finance since 1985.
He is widely recognized for reviewing public issues and non-convertible debentures (NCDs) in the primary market. Drawing on over three decades of market experience and close interaction with merchant bankers, his reviews focus on detailed fundamental and financial analysis of companies, with a special emphasis on SME public issues.
Dilip Davda
SEBI Registered Research Analyst – Mumbai
Registration No.: INH000003127 (Perpetual)
Email: dilip_davda@rediffmail.com
Disclaimer: The information provided herein is solely for educational and informational purposes and does not constitute an offer, solicitation, or recommendation to buy or sell any securities. Readers are advised to consult a qualified financial advisor before making any investment decisions. Investments in the securities market are subject to market risks. The author does not intend to invest in the securities discussed.
