Bawany Air Products Announces Rs6bn Rights Issue at 73% Discount

On September 16, 2026, Bawany Air Products Limited (PSX: BAPL) announced a rights issue of 599,999,732 new ordinary shares, aggregating to Rs5.99 billion, at a ratio of 98.765 rights shares for every 100 shares held.

The shares are priced at par value of Rs10 each, representing a discount of approximately 73 % to the prevailing market price as of September 2, 2026, the date the board approved amendments in line with SECP directions.

The rights issue was approved by the board at meetings held on August 26, 2024 and September 2, 2026, with no dissenting votes. Directors present at the approval meeting included Mohabat Khan, Zahir Khan, Naim Anwar, Muhammad Ali, Huma Javaid, Saba Azam and Suhail Elahi.

Proceeds from the issue will be used entirely for Alman Seyyam Sugar Mills (Pvt.) Limited (ASSML), a wholly owned subsidiary of BAPL (51,114,011 shares, 100 %).

ASSML is establishing a 10,000 metric‑tonnes‑per‑day crushing capacity plant at Dera Ismail Khan, with major plant components sourced from Pakistan, the United Kingdom, Germany, Japan and China.

Half of the proceeds, Rs2.99 billion, will fund capital expenditure for plant and machinery procurement, while the remaining Rs2.99 billion will cover working capital needs including inventory, raw material purchases and input costs.

The estimated project cost breakdown for ASSML is as follows:

• Land: Rs829 million
• Building (Process House, Power House, Hostel): Rs1,077 million
• Plant & Machinery (Boiler, Turbines, Tanks, ETP, Automation): Rs9,892 million
• Pre‑operating expenses: Rs200 million
• Fire equipment, hydrants: Rs10 million
• Government licenses (Gas, LESCO): Rs150 million
• Contingencies and others: Rs150 million
• Total: Rs12,330 million

Book closure for the rights issue is set for September 23, 2026. Dawood Equities Limited is underwriting Rs2.80 billion of the issue, while United Bank Limited has been appointed banker to the issue.

Weavers Pakistan (Pvt.) Limited has committed to subscribing 319,712,000 shares worth Rs3.19 billion, which would raise its shareholding from 0.5 % pre‑issue to 26.73 % post‑issue.

Post‑issue, BAPL’s authorized share capital will rise from 1,100,000,000 to 1,210,000,000 shares (up 10 %), while paid‑up capital will increase from 607,502,510 to 1,207,502,242 shares (up 98.765 %).

Net assets breakup value per share will move from Rs(6.98) to Rs13.87, and the gearing ratio from (0.85) % to 0.006 %.

Total expenses for the issue include underwriting commission of 1 %, bankers’ commission of 0.5 %, PSX fees of up to Rs13.8 million, SECP supervisory fee of up to Rs1.2 million, CDC fresh issue fee of 0.144 % of new share capital, stamp duty of up to Rs9 million, auditor fee of up to Rs0.5 million, and other expenses of up to Rs2 million.

On the financials, BAPL posted a net loss after tax of Rs54.05 million for FY25, compared with a loss of Rs22.62 million in FY24 and a profit of Rs59.39 million in FY23.

Total assets stood at Rs3.18 billion as of June 30, 2025, up from Rs31.31 million a year earlier, following the acquisition of ASSML.

Accumulated losses reached Rs104.28 million by FY25. The average market price of BAPL shares over the last six months (February 21 to August 21, 2026) was Rs36.36 per share.

BAPL was incorporated in Quetta on August 16, 1978 and is listed on the Pakistan Stock Exchange. Its principal activity is investment in and holding of shares, stock, debentures and securities.

The company had earlier completed an issuance of 600,000,000 shares otherwise than rights to the sponsors of ASSML, which brought ASSML under BAPL as a subsidiary and preceded the current rights issue process.

On risk factors, BAPL noted an under‑subscription risk given the rights are priced below the prevailing market rate, though substantial shareholders, promoters and directors have confirmed subscription to their respective entitlements, with the balance to be underwritten.

No outstanding legal proceedings against the company were reported.

The information was disseminated through a notification to the Exchange.

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