MobiKwik is gearing up to go public in the coming months and likely to file its Draft Red Herring prospectus or DRHP later this month. Moving in that direction, its board has passed a special resolution to approve the conversion of MobiKwik’s holding entity to a public entity from a private limited firm.
The newly formed entity is called One Mobikwik Systems Limited.
Further, MobiKwik has passed another special resolution to issue bonus shares to its existing equity shareholders in the ratio of 3:1, regulatory filings show. This essentially means that the company is allotting 3 equity shares for one equity share held.
Mobikwik has issued and allotted 156,17,940 equity shares to its 67 equity shareholders and its co-founders Bipin Preet Singh and Upasana Taku are the largest beneficiaries of this bonus issue as they have been allotted 87,30,930 and 61,80,900 fully paid equity shares respectively.
The bonus shares issued to the co-founders constitutes 95.47% of the total bonus issue.
Also, Singh and Taku have been appointed whole time directors, and chief executive officer and chief operating officer respectively. The company’s board has also approved an increase in their compensation for a period of three years from June 23, 2021, to June 22, 2024.
Singh’s total compensation has also been increased by 198.5% from Rs 1.34 crore paid out as managerial remuneration during FY21 to Rs 4 crore. Rs 2.5 crore is a fixed component whereas Rs 1.5 crore is linked to performance-based variable compensation. Taku’s compensation also increased by 198.5% and the breakup of her annual compensation is similar to that of Singh.
Separately, MobiKwik’s board has also approved the appointment of Chandan Joshi as a whole-time director in the company and revised his remuneration structure for a period of three years starting from June 23, 2021. Joshi’s compensation has been hiked by 114.3% from Rs 1.4 crore to Rs 3 crore, in which, Rs 2 crore is fixed salary and Rs 1 crore is performance-driven.
MobiKwik has passed a special resolution to approve investment in an entity over and above the prescribed limits of the Companies Act 2013. The shareholders have approved the resolution for making investments upto Rs 1,500 crore over the prescribed limits in a different company.
The company has also amended its object clause and may enter the virtual payment services, distribute loan products and screening borrowers and generating credit scores. Significantly, Mobikwik also added clauses to facilitate service brokers, commission agents and carry on the business of retail and institutional distribution of schemes of mutual funds and other financial products.