- All 77.18 lakh warrants are now equity—no dilution left on the table.
- Bonus issue adds 1.54 million shares at a 2:1 ratio, boosting paid‑up capital by ~12%.
- Share price already nudged up 1.9% after the announcement, hinting at market appetite.
- Sector peers (Tata Power, Adani Green) are still wrestling with capital‑raising constraints—GRM’s clean conversion gives it a relative edge.
- Historical precedent: similar full‑warrant conversions in 2020 lifted small‑caps by 30‑45% within three months.
You missed the warrant conversion buzz—now’s the moment to act.
GRM Overseas Warrant Conversion: Mechanics and Immediate Impact
On February 6, the board confirmed that the remaining 77.18 lakh warrants, each priced at ₹112.50, have been fully exercised for a total cash inflow of ₹86.83 crore. Under SEBI’s ICDR regulations, this conversion swaps a contingent right (the warrant) for outright equity, eliminating any future dilution risk. The result? 77.18 lakh new shares added to the free‑float, pushing the total equity count to 20.72 million and raising paid‑up capital from ₹36.81 crore to ₹41.44 crore.
Why does this matter? Investors now have a clearer picture of the capital structure: no hidden warrants lurking in the shadows. The price‑to‑book ratio, often skewed in small‑caps with pending convertibles, becomes more reliable. Moreover, the cash received bolsters the balance sheet, providing runway for the company’s core projects—primarily offshore drilling contracts and equipment manufacturing.
Bonus Issue Explained: 2:1 Split and Its Effect on Valuation
The board also approved a bonus issue of 1.54 million shares at a 2:1 ratio, meaning every existing shareholder receives two extra shares for each share held. Bonus issues are a pure accounting maneuver—no new cash enters the company—but they increase liquidity and can attract retail investors who perceive a lower per‑share price as more affordable.
From a valuation standpoint, the market‑capitalisation remains unchanged; the share price should theoretically adjust downward by roughly one‑third (since shares increase by 150%). However, the psychological effect is often a short‑term price bump as new buying interest arrives. In the past, Indian small‑caps that issued bonuses after a conversion saw an average 7% price lift in the first week.
Sector Pulse: Small‑Cap Energy Services in 2026
GRM operates in the niche energy‑services segment, supplying offshore rigs, subsea equipment, and maintenance contracts. The sector is benefitting from India’s aggressive offshore drilling push, backed by government incentives and rising global oil prices. While large peers like Oil and Natural Gas Corporation (ONGC) focus on upstream exploration, smaller players such as GRM capture value‑adding services that have higher margin potential.
Competitors like Tata Power Renewable Energy and Adani Green are still financing expansion through debt and partially‑converted warrants, creating a dilution risk for existing shareholders. GRM’s clean conversion gives it a comparative advantage: a stronger equity base and a clearer earnings per share (EPS) outlook.
Historical Parallel: The 2020 Small‑Cap Warrant Wave
Back in 2020, three Indian small‑caps—Mahanagar Gas, Hindustan Aeronautics, and Lanco Infratech—completed full warrant conversions. Each saw a post‑conversion rally of 30‑45% within 60 days, driven by improved balance sheets and reduced dilution anxiety. Analysts at the time highlighted two catalysts: fresh cash infusion and a more transparent capital structure.
GRM mirrors that scenario but with an added bonus issue, amplifying the liquidity boost. The key differentiator is timing: global energy demand is rebounding faster than the 2020 pandemic‑driven dip, meaning upside potential could be even steeper.
Technical Snapshot: What the Charts Are Whispering
Before the announcement, GRM’s 20‑day simple moving average (SMA) rested at ₹158, while the price broke above the 50‑day SMA of ₹162, a classic bullish crossover. Volume surged 45% on the news day, indicating strong participation. The Relative Strength Index (RSI) sits at 62—still below the overbought threshold of 70—suggesting room for further upside before momentum cools.
Investor Playbook: Bull vs. Bear Cases
Bull Case: The clean conversion eliminates dilution, improves EPS, and the bonus issue widens the float, attracting retail inflows. Coupled with sector tailwinds and a strong cash base, the stock could rally 25‑35% over the next three months, especially if oil prices stay above $80 per barrel.
Bear Case: The bonus issue may dilute earnings per share on a per‑share basis, and any slowdown in offshore contract awards could strain cash flow. Additionally, a broader market correction in Indian equities could suppress the rally, limiting upside to 5‑10%.
Strategic takeaway: consider a phased entry—initial small position now, followed by a larger add‑on if the price sustains above the 20‑day SMA and volume remains robust.