Cancellation of share capital against accumulated losses and return of excess capital

Initially, the Company was formed to engage in the manufacturing activity, and therefore, it was heavily capitalized. Due to compelling reasons, the Group took strategic decision to cease manufacturing activity and continue the service activity by supporting Group mostly on a cost-plus model. However, the manufacturing operation by then incurred huge losses and the Company was heavily capitalized. But due to accumulated losses, the Company’s capital was not represented by the available assets. Furthermore, heavy capital also triggered certain compliances for the Company as per Indian company law.

The Nexdigm approach to this project was based on project management's four pillars: Time, Cost, Quality, and Risk. The assignment's primary requirement was to assess the existing situation and build a roadmap for business reorganization. A dedicated project team was assigned, which led the project, which involved complex regulatory involvement coupled with the practical challenge of a raging pandemic.

Undeterred by pandemic restrictions/lock-down, the Nexdigm project team ensured that the capital reduction is consummated by March 2022 by resolving every critical issue appropriately and in accordance with the law, delivering to the management’s expectations.