Nature of the Disclosure

Regulatory filing pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, notifying stock exchanges about a Postal Ballot Notice for shareholder approval of material related party transactions.

Key Quantitative Figures

  • Total value of proposed related party transactions: ₹107,69,44,000 (One Hundred Seven Crore Sixty Nine Lakh Forty Four Thousand)
  • Conversion of unsecured loan to CCPS: ₹100,15,44,000 (One Hundred Crore Fifteen Lakh Forty Four Thousand)
  • Other transactions (services, interest, reimbursements): ₹7,54,00,000 (Seven Crore Fifty Four Lakh)
  • Transaction value as percentage of consolidated turnover: 61.93%
  • Transaction value as percentage of Mukta A2's standalone turnover: 125.50%

Dates of Action

  • Cut-off date for shareholder eligibility: Monday, 12th October, 2026
  • Dispatch of notice completion: Thursday, 15th October, 2026
  • Remote e-voting commencement: Monday, 19th October, 2026 at 9:00 a.m. IST
  • Remote e-voting end: Tuesday, 17th November, 2026 at 5:00 p.m. IST
  • Resolution deemed passed on: Tuesday, 17th November, 2026

Parties Involved

  • Mukta Arts Limited (Listed entity)
  • Mukta A2 Cinemas Private Limited (Subsidiary and related party)
  • National Securities Depository Limited (NSDL) - e-voting service provider
  • M/s. KDA & Associates - Scrutinizer
  • BSE Limited and National Stock Exchange of India Limited

Purpose and Rationale

The transaction aims to convert outstanding unsecured loans (including accrued interest) given by Mukta Arts to Mukta A2 into Compulsorily Convertible Preference Shares to improve Mukta A2's cash flow position and enable the company to benefit from its future growth and improved business prospects.

Financial and Operational Impact

The transaction involves conversion of existing debt into equity instruments (CCPS) which will result in increased stake in the subsidiary company. The CCPS carry a nominal dividend rate of 0.001% p.a. and have a 20-year term with conversion triggers based on external investor investment events or IPO.

Capital Structure Impact

The conversion will result in issuance of 100,15,440 Compulsorily Convertible Preference Shares of Mukta A2 at face value of ₹10 each and securities premium of ₹90 per share. The exact number of equity shares to be issued upon conversion will be determined based on valuation at the time of conversion event.

Governance Aspects

The Audit Committee has approved the transactions after satisfying itself that they are at arm's length and in the ordinary course of business. Directors Mr. Subhash Ghai, Mr. Rahul Puri, Mr. Parvez Farooqui, and Mr. Rajendra Doshi are considered interested in the resolution due to their board positions in Mukta A2.

Voting Restrictions

Related parties as defined under SEBI Listing Regulations shall not vote to approve the resolution, in compliance with regulatory requirements.