Hospitality company Kamat Hotels (India) Ltd announced on Friday that its board approved the conversion and allotment of 10,68,805 equity shares under the exercise of warrants to raise Rs 7.77 crore.

Shares of the company surged 5% to close at Rs 136.75 following the announcement.

The company said its board of directors has considered and approved the conversion and allotment of 10,68,805 warrants into 10,68,805 equity shares of Rs 10 each on March 10, 2023, an equal number of warrants issued to the two promoter entities on the conversion of preferential basis.

The company received a capital infusion of Rs 7.77 crore at Rs 72.75 per warrant.

Promoter Vithal V Kamat has issued 5,89,602 shares worth Rs 4.28 crore, while another promoter entity, Plaza Hotels Pvt Ltd, has issued 4,79,203 shares for an infusion of Rs 3.48 crore.

After the allotment, the company’s paid-up capital has increased to Rs 24.65 crore, comprising 2.46 crore equity shares at Rs 10 each.

The Executive Committee of the Board on February 23, 2023, approved the allotment of 58,96,014 warrants at Rs 97 each payable in cash, aggregating to Rs 57,19,13,358 on a preferential basis to the promoter/promoter group of the company and certain identified non-promoter persons.

Non-sponsor entities include Purple Clover Tree LLP, Alpha Alternatives Holdings Pvt Ltd and Alpha Alternatives Structured Credit Opportunities Fund.