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Black Box Limited, a trusted global digital infrastructure solution integrator delivering cutting-edge technology solutions and worldclass consulting services to businesses around the globe, announced that it has received commitment for raising funds aggregating to Rs 410 crore via preferential issue aimed at accelerating growth and expansion in digital infrastructure sector. 

The company's Board of Directors, at its meeting held on Friday, approved the issuance in one or more tranches, 98,32,123 fully convertible warrants at Rs 417 per warrant, aggregating to Rs 410 crore. Each warrant is convertible into one equity share of the face value of Rs 2, each fully paid-up (equity share) of the company at a premium of Rs 415 at the option of proposed allottee, in one or more tranches, at any time within 18 months from the date of allotment of the warrants in accordance with the relevant provisions of SEBI ICDR regulations.

The funding round has garnered Rs 200 crore from the existing promoters of the company, which shows the continued confidence on the business and its growth plans, Rs 200 crore from the consortium of marquee investors comprising foreign institutional investors (FIIs) and high-net-worth individuals (HNIs), and Rs 10 crore by key management personnel of the company. 

After the conversion of warrants into equity, promoter shareholding will be marginally lower from the existing 71.1 per cent to 69.8 per cent. 

Black Box continues to be Essar’s key investment in the technology space.

Over the last couple of years, the company has focused on improving margins by taking several cost rationalisation initiatives with emphasis on enhancing productivity. 

This has yielded positive outcomes leading to an increase in the company's EBITDA margins and profit after tax (PAT). 

The company achieved EBITDA of Rs 428 crore in FY24, growth of 59 per cent on FY23 EBITDA and PAT of Rs 138 crore in FY24, which is 5.8x on FY23 PAT. The company expects continued growth momentum on EBITDA and PAT in the current financial year too.

The fund raise capital is a growth capital for the company and will be invested across several key areas:

* Expansion of Data Centre Build Capabilities: Data centre capacity is expected to grow exponentially over the next 3-5 years fuelled by adoption of Cloud and AI. Black Box has strong presence in this segment and would invest in the value chain to be a dominant player providing expanded services to Hyperscalers, Multi-Tenant Data Centre operators and Large Enterprise Data Centres.

* Advancement in Network Infrastructure: Black Box will deploy capital to expand its solutions portfolio for its enterprise customers and dcentre operators including Hyperscalers in the areas of connectivity infrastructure and networking that will be critical to support increasing data traffic and demands of better user experience at the edge.

* Innovation and Delivery: A portion of the funds will be allocated to innovation and development efforts aimed at pioneering new digital infrastructure solutions, including advancements in Cloud computing infrastructure, cybersecurity, AI and IoT.

* Go To Market Expansion: The investment will support the company’s strategic expansion and growth initiatives into key industry verticals with relevant technology solutions with key leadership hiring and expanding its sales and business development efforts significantly, both in north America and emerging markets.

Sanjeev Verma, Chief Executive Officer, Black Box Limited, said, “We are thrilled to have secured this capital, which will enable us to embark on an ambitious growth trajectory and enhance our digital infrastructure offerings and drive innovation in a rapidly evolving market.”

Deepak Bansal, Chief Financial Officer, Black Box Limited, said, “We are thankful to the existing investors for their continued confidence and welcoming new investors as we embark on the next phase of growth and profitability. The company remains committed to invest in the areas of growth and maintain sharp focus on operational efficiency and return on capital.”