The Security Issuance Committee will oversee the process, with the company planning to complete the allotment within 30 days of closure.
On 16 May 2025, small-cap technology company Kellton Tech launched a $10 million issuance of Foreign Currency Convertible Bonds (FCCBs), a decision approved by its board on 14 May. The bonds, carrying a 6.5 per cent coupon rate and a ten-year maturity, will be listed in international markets. The minimum conversion price is fixed at ₹106 per equity share. The company’s stock closed at ₹118.50 on Friday, up 2.73 per cent, after a rally of 684.77 per cent over five years, drawing investor attention ahead of Monday’s trading.
FCCB Issuance: Details and Implications
According to Kellton Tech’s regulatory filing, the FCCBs are senior unsecured bonds maturing 10 years and 1 month after full subscription. Priced at a conversion rate of ₹85.3 per US dollar, the issuance is worth approximately ₹85.3 crore. Upon full conversion, the offering would translate into about 80.47 lakh equity shares with a face value of ₹5 each.
The Security Issuance Committee will oversee the process, with the company planning to complete the allotment within 30 days of closure. The reference date for pricing was set at 14 May 2025, in line with the FCCB Scheme.
Clean Track Record, No Dilution Plans
In its disclosure, Kellton Tech highlighted that it has no history of FCCB defaults, underlining investor confidence. The company also confirmed it has no current plans for issuing bonus or preferential shares alongside the FCCBs.
This step is seen as a strategic capital-raising exercise, aimed at supporting long-term expansion, particularly as the IT sector undergoes rapid transformation amid increasing demand for digital and cloud-based solutions.
Five-Year Rally Raises Eyebrows
Kellton Tech’s share price has grown almost sevenfold in the last five years, rising 684.77 per cent from its earlier levels to its current price of ₹118.50. The firm’s performance and clean governance profile have attracted investors, especially in the small-cap space, where consistent compounders are rare.
Market Outlook
As the company prepares to expand with fresh capital, analysts will be closely watching how it utilises the proceeds. The absence of dilution via bonus or preferential shares and the defined FCCB terms reflect a disciplined approach. With global FCCB exposure, Kellton Tech may also see enhanced international visibility and investor engagement.
The FCCB issuance marks a significant milestone in Kellton Tech’s funding strategy, complementing a stellar five-year stock performance. With a transparent and focused execution plan, the company positions itself for sustainable growth, while market participants remain alert to how the capital will be deployed in a dynamic technology landscape.
