HDFC Bank froze Yudiz Solutions' account due to a disagreement over IPO funds, which has now been resolved, allowing the company access to its finances again.
Yudiz Solutions, a tech startup known for its innovative work in blockchain and IT development, announced that HDFC Bank has unfrozen its account containing its Initial Public Offering (IPO) proceeds. This positive update was shared through a formal exchange filing on June 19.
The company stated, "We are pleased to inform you that HDFC Bank has lifted the freeze on our bank account. We have received official confirmation from the bank regarding this development." This news comes after over a month during which the account was inaccessible.
The trouble began on May 10 when Yudiz reported that HDFC Bank had frozen its account, citing non-compliance with internal bank standards as the reason. Despite Yudiz's insistence that it had met all requirements, the situation escalated, leading the company to take legal action. "Despite all efforts to resolve the issue, we had no choice but to issue a legal notice to the bank. We are now exploring legal options to ensure this does not happen again," Yudiz mentioned in a previous filing.
Yudiz Solutions, based in Ahmedabad and established in 2011, has made a name for itself in web and mobile app development. The company also ventures into cutting-edge technologies such as Augmented Reality (AR), Virtual Reality (VR), Artificial Intelligence (AI), Machine Learning (ML), blockchain, and the Internet of Things (IoT).
Last year, Yudiz went public on the NSE Emerge platform with an impressive debut. The company's shares were listed at a 12% premium over the issue price of INR 165, raising INR 44.84 crore from the public. This IPO included a fresh issue of 27,17,600 equity shares. The market response was overwhelmingly positive, with the IPO being oversubscribed 4.75 times – receiving bids for 92.91 lakh shares against the 19.57 lakh shares available.
The funds raised from the IPO were earmarked for several strategic initiatives. Yudiz intended to invest in new product development, enhance its technology infrastructure, and expand marketing efforts. Additionally, the proceeds were to be used for acquisitions both within India and internationally, capital expenditures, and to support working capital needs.
Despite these ambitious plans, the financial year 2023-24 was challenging for Yudiz. The company reported a net loss of INR 2.9 crore, a stark contrast to the net profit of INR 2.7 crore in the previous financial year (FY23). This downturn was attributed to a decline in revenue during the second half of the year, with operating revenue dropping by 4% from INR 27.3 crore in FY23 to INR 26.1 crore in FY24.
Yudiz Solutions' journey reflects the dynamic and often unpredictable nature of the tech industry. Despite the recent setbacks, the unfreezing of their bank account by HDFC Bank marks a significant step forward, enabling the company to refocus on its growth and development goals.
