Texmaco Rail and Engineering Limited announced that it would not raise fund through the proposed rights issue midst of economic slowdown and its promoters have decided to infuse an equity capital of up to Rs 200 crore for meeting capital needs of the company.

Last year, the board approved to raise funds through the issuance of rights to ensure adequate resource availability for the firm. But, after reviewing its earlier decision, it has decided not to proceed with it as it will decline stock price. The company had posted a loss of Rs 27 crore in the April-June quarter due to the Covid-19 pandemic.

The company in a statement said, “…regard to the urgency of the fund requirements of the company; the board has approved the issuance of equity shares of the company by way of the preferential issue to the promoters for an amount not exceeding Rs 200 crore”.

On Tuesday the company said, “The overall impact of COVID-19 on the country is still severe… the silver lining is the privatisation of railway services to boost rail infrastructure. This would lead to the generation of new opportunities”.