What’s new

• CARE Ratings can't verify utilisation of ₹74.11 cr rights-issue money after 40 days of non-response.
• Share price collapsed to ₹1.41 from ₹6.22 issue price, a 77% drop.
• Company changed registered office and altered MOA object clause post-issue.

Why it matters

A monitoring agency walking away from verification is a rare and severe red flag. It suggests the company cannot—or will not—account for money raised from public investors. For a nano-cap already down 77%, this could trigger regulatory scrutiny and make future fundraising nearly impossible.

What we’re watching

• Whether SEBI takes cognizance of the monitoring agency's failure to verify.
• Any response from Mehai explaining the gap in documentation.
• Impact on the company's ability to raise further capital.

The full read

Mehai raised ₹74.11 crore from public investors in a rights issue priced at ₹6.22 per share. CARE Ratings, the monitoring agency tasked with tracking how the money was spent, has now reported that it cannot verify the utilisation of proceeds at all — after 40 days of repeated follow-ups met with no response. In the same period, the company changed its registered office and amended the object clause in its MOA, while the stock has lost 77% of its value to trade at ₹1.41. For a company with a market cap of ₹98 crore, the ₹74 crore issue represented 75.6% of its pre-raise capitalisation. That a monitoring agency has effectively given up on its mandate is the clearest possible governance failure, one that puts the burden squarely on Mehai to prove where the money went rather than on the regulator to find out.

Primary source: BSE · NSE