MEMax Estates544008Board key decisions

Board approves corporate guarantee for subsidiary term loan of up to ₹350 crore, new wholly-owned subsidiary

A corporate guarantee for a term loan of up to ₹350 crore proposed to be availed by Max Estates 128 Private Limited, a wholly-owned subsidiary — a contingent liability with no immediate outflow from issuing it alone.

By ScoutQuest · Wed 4 Nov 2026, 9:44 PM IST · 3 min read

Corporate guarantee

up to ₹350 crore

New subsidiary paid-up capital

₹1,00,000

QIP unutilised

₹3.94 crore

What the board approved

• A corporate guarantee for a term loan facility of up to ₹350 crore proposed to be availed by Max Estates 128 Private Limited ("Max 128"), a wholly-owned subsidiary.
• Incorporation of a new wholly-owned subsidiary; the name is being finalised subject to Ministry of Corporate Affairs approval.
• Review, as recommended by the Audit Committee, of CARE Ratings' monitoring reports for the quarter ended September 30, 2026 on the use of Qualified Institutional Placement and convertible warrant proceeds.

The guarantee, in plain terms

The guarantee is to be given as a condition precedent to the facility, which means the loan is expected to be drawn only once it is in place. It remains valid until Max 128 fully discharges its obligations under the facility documents. The update describes it as a contingent liability of the company, with no immediate financial outflow arising solely from its issuance. In simple words, a contingent liability is a possible obligation: it turns into an actual payment only if the subsidiary does not repay the loan.

The new subsidiary

• Proposed authorised share capital of INR 10,00,000, divided into 1,00,000 equity shares of INR 10 each.
• Proposed paid-up capital of INR 1,00,000, divided into 10,000 equity shares of INR 10 each.
• The shares are to be subscribed in cash, including 1 equity share each held by 6 nominees on behalf of the company.
• The entity is to carry on real estate activities, the same line of business as the company.

QIP utilisation check for the quarter

• QIP issue size was Rs. 800.00 crore, with net proceeds available for use of 779.58 crore after issue expenses of 20.42 crore.
• At the end of the quarter, total utilisation stood at 796.06 crore, leaving 3.94 crore unutilised.
• The unutilised amount is held in Yes Bank fixed deposits earning 7%, maturing on 12-04-2027.
• CARE records no deviation from the objects of the issue. It does flag a delay: against a plan to deploy ₹350.00 crore by March 31, 2025, ₹328.44 crore had been used by then, a delay of 23 days. For the March 31, 2026 milestone the report states the exact number of days of delay is not ascertainable, with 3.94 crore still pending.
• General corporate purposes and issue expenses are shown as fully utilised, with no delay.
• The report notes the unutilised proceeds were placed in a fixed deposit arrangement involving a subsidiary, which the placement document does not specifically mention, and says the board may take note of it.

What a retail investor may want to track

• The ₹350 crore guarantee does not move cash today; it matters if Max 128 is unable to service the loan.
• Land and land-related deployment under the QIP is nearly complete, with only 3.94 crore left.
• The new subsidiary is being set up in the same real estate line of business, so it extends the existing business structure rather than adding a new one.

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