Dost Steels Limited plans to raise Rs4.45 billion through a rights issue to finance the installation of a melting furnace and meet working capital needs.
The company disclosed the development in a filing to the Pakistan Stock Exchange on Monday.
The rights issue will be approximately 100 percent of the company’s existing paid-up capital. Dost Steels will issue 444,695,577 ordinary shares at par value of Rs10 per share.
Shareholders will receive 100 right shares for every 100 ordinary shares they hold.
According to the filing, the funds will be used for the installation and commissioning of a melting furnace to produce billets, which are the essential raw materials for the company’s finished products. Dost Steels said the project will help reduce raw material costs and improve profit margins.
The company added that the melting furnace will increase operational efficiency, improve supply chain control, and support long-term business sustainability. It expects these changes to enhance profitability and shareholder value, strengthening its financial position and market competitiveness.
Dost Steels stated that the rights issue is priced near the current market value, minimising any major risk. However, it acknowledged that the normal business risks will continue.
Dost Steels Limited began Monday’s session at Rs7.28. At the time of its rights issue announcement on the Pakistan Stock Exchange, the stock was trading at Rs7.26. Following the disclosure, it climbed to an intraday high of Rs7.42 before closing at Rs7.24, marking a decline of Rs0.18 or 2.43 percent
