Negen Capital Services Discloses Substantial Acquisition in Digilogic Systems Limited

Negen Capital Services Private Limited has submitted a regulatory disclosure to the Bombay Stock Exchange regarding substantial acquisition of shares in Digilogic Systems Limited. The disclosure, filed under Regulation 29 of SEBI's Substantial Acquisition of Shares and Takeovers Regulations, 2011, details the increased shareholding of entities under common management following the company's Initial Public Offer. Acquisition Details The acquisition involves three related entities: Negen Undiscovered Value Fund (NUVF), Negen Capital Services Private Limited, and Neil Madan Bahal. NUVF is a scheme of Negen Investment Trust, which is registered with SEBI as a Category III Alternative Investment Fund bearing registration number IN/AIF3/22-23/1254. Negen Capital Services serves as the Investment Manager to NUVF, while Neil Madan Bahal is the Director and Ultimate Beneficial Owner of Negen Capital Services. Parameter: Details Target Company: Digilogic Systems Limited Stock Exchange: Bombay Stock Exchange – SME Acquisition Date: January 23, 2026 Mode of Acquisition: Public Issue (IPO) New Shares Acquired: 20,34,000 Shareholding Structure The entities' shareholding structure shows a significant increase following the IPO participation. Prior to the Initial Public Offer, the combined entities held 17,97,850 equity shares representing 8.08% of the pre-issue equity share capital. Pre-IPO Holdings: Entity: Shares Held Percentage NUVF: 14,25,515 6.41% Neil Madan Bahal: 2,44,680 1.10% Negen Capital: 1,27,655 0.57% Total: 17,97,850 8.08% Post-IPO Holdings: Entity: Total Shares Percentage NUVF: 34,59,515 11.95% Neil Madan Bahal: 2,44,680 0.85% Negen Capital: 1,27,655 0.44% Combined Total: 38,31,850 13.24% Regulatory Compliance The disclosure was made on a prudential basis under Regulation 29(1) and Regulation 29(2) of the Takeover Regulations, considering the aggregate holding of entities under common management. The company noted that while the pre-IPO shareholding had already been disclosed in the Red Herring Prospectus and the IPO allotment was disclosed as part of the IPO process, this additional disclosure ensures full regulatory compliance. The equity share capital of Digilogic Systems increased from 2,22,52,630 shares before the acquisition to 2,89,51,030 shares after the IPO completion. The disclosure was signed by Jigar Dinesh Shah, Director of Negen Capital Services Private Limited, on January 27, 2026, from Mumbai. Digilogic Systems Limited has achieved a significant financial milestone by fully repaying its outstanding Indian Bank term loan of ₹8.42 crores on January 31, 2026, utilizing proceeds from its recent Initial Public Offering. This strategic debt reduction aligns with the company's stated IPO objectives and strengthens its financial position for future growth in the defence and aerospace sectors. Debt Repayment Details The company utilized a combination of funding sources to complete the loan repayment: Funding Source: Amount (₹ Crores) IPO Proceeds: 8.00 Internal Accruals: 0.42 Total Repayment: 8.42 This prepayment was originally earmarked as one of the key objectives in the company's IPO prospectus, demonstrating management's commitment to reducing debt burden and optimizing capital structure. Business Focus and Market Position Digilogic Systems operates primarily in the defence and aerospace sectors, specializing in Test, Measurement & Simulation (TMS) markets. The company serves an established clientele including premier defense organizations through its comprehensive portfolio of test systems, application software, and services. The company's business verticals encompass automated test systems, checkout systems, radar and electronic warfare simulators, data acquisition systems software, and intellectual property cores. These solutions cater to critical applications in missile testing, radar systems, avionics, and satellite technologies. Financial Performance and Growth Projections The company's recent financial performance shows consistent improvement across key metrics: Key Ratios: FY23 FY24 FY25 As of Sept 30, 2025 EBITDA Margin %: 9.43% 10.56% 18.60% 18.39% PAT Margin %: 3.89% 4.65% 11.26% 8.87% ROE %: 21.76% 19.53% 34.57% 4.71% ROCE %: 20.68% 19.10% 34.27% 4.71% Debt to Equity (times): 0.99 0.60 0.40 0.63 For FY26, the company has provided specific growth guidance, targeting 20-25% revenue growth, 30-35% EBITDA growth, and 40-45% PAT growth. The company currently maintains an order book of approximately ₹46 crores and is participating in bids worth approximately ₹200 crores. Project Udaan Expansion Initiative The company outlined Project Udaan, a major expansion initiative funded through IPO proceeds of ₹69.66 crores. The fund utilization breakdown includes: Component: Amount (₹ Crores) Project Udaan: 51.74 Repayment of Debt: 8.00 General Corporate Purposes & Issue Expenses: 9.92 Project Udaan aims to expand current verticals through additional workspace capacity, introduce manufacturing of electronic sub-systems with build-to-spec and build-to-print capabilities, establish in-house environmental stress screening and qualification facilities, and enable section-level integration of sub-systems. The project is on track for completion by end of FY28. Management Commentary Madhusudhan Varma Jetty, Chairman & Managing Director, appreciated the long-standing support from Indian Bank and emphasized that this full repayment significantly reduces debt and financing costs. He expressed confidence that with orders on hand of ₹46 crores and participation in bids of ₹200 crores, the company is well-positioned to achieve its FY26 growth targets of 20-25% growth in topline, 30-35% growth in EBITDA, and 40-45% growth in PAT. We’re building Scanx - to help you express your trading & investing idea, to help you analyse the markets better. Stock Markets are the true indicator of the growth of any country's economy. We are bullish on India, we are bullish on India's prospects to be one of largest economies of the world. We believe that Stock Markets provide an unique opportunity for all Indians to participate in the growth story of India. We are enabling the same for Indians. As financial services are becoming more accessible, there is now a large set of Indians today who are financially aware and literate. They value time and seek high quality products & services. 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