New Delhi, March 21 (IANS) The central government on Wednesday allowed defence communication major ITI Limited to go in for a “prospectus based” Further Public Offer (FPO) to raise working capital and to reduce its debt obligations.
The development follows Cabinet Committee on Economic Affairs’ approval for a Department of Telecommunication’s proposal to allow ITI Limited to go in for the FPO.
Besides, the CCEA’s move will allow ITI Limited to meet Sebi’s requirement of minimum 25 per cent public shareholding.
According to the CCEA, the FPO will provide “the much needed working capital to the company and help it to timely execute the orders that it has in hand and improve its margins”.
“This, in turn, will help in protecting the current employment and generating more job opportunities in the company particularly in the field of new telecom technologies,” the CCEA said in a statement.
As on December 31, 2017, the issued and subscribed equity capital of the company stood at Rs 760 crore (76 crore of equity shares of face value of Rs 10 each) out which 92.59 per cent equity is held by the central government.
The company is a listed schedule “A” CPSE, under the administrative control of Ministry of Communications, Department of Telecommunication.
It is a supplier for the defence communication and networking needs and a major supplier of encryption products to Indian Army.