Monte Carlo Fashions Limited (NSE:MONTECARLO) disclosed on 21 August 2026 that it has executed a loan agreement with MCFL Energy Projects Private Limited, its wholly-owned subsidiary, to provide an unsecured loan facility of up to Rs 19 crore for funding the subsidiary's solar energy project under the KUSUM-C Scheme.
Key Highlights
- Monte Carlo Fashions Limited signed a loan agreement with MCFL Energy Projects Private Limited, its 100%-owned subsidiary, on 21 August 2026.
- The unsecured loan facility is capped at Rs 19 crore, carries an interest rate of 9% per annum compounded annually, and has a maximum tenor of five years from the effective date.
- The funds will be used to meet financing requirements for the subsidiary's ongoing and proposed energy-related projects, specifically under the KUSUM-C solar scheme.
- The transaction is classified as a related party transaction and has been confirmed by the company to be conducted at arm's length, with no security provided by the borrower.
About the Company
Monte Carlo Fashions Limited (NSE:MONTECARLO), headquartered at B-XXIX-106, G.T. Road, Sherpur, Ludhiana, Punjab, is a vertically integrated apparel manufacturer and retailer operating under the Monte Carlo brand. The company designs, manufactures, and markets woollen knitwear, cotton casuals, and home furnishings, distributing through an extensive network of exclusive brand outlets and multi-brand stores across India. It is listed on both NSE and BSE, with CIN L51494PB2008PLC032059.
Announcement in Detail
In a Regulation 30 filing dated 21 August 2026, Monte Carlo Fashions Limited disclosed the execution of a loan agreement with MCFL Energy Projects Private Limited, a wholly-owned subsidiary incorporated to implement a solar project under the government's KUSUM-C Scheme. The filing references a prior board approval granted on 5 August 2026 for an overall investment of up to Rs 30 crore in the subsidiary through equity shares, preference shares, debentures, or unsecured loans in one or more tranches.
The specific loan agreement executed on 21 August 2026 covers an unsecured loan facility of up to Rs 19 crore. The borrower is required to pay interest at 9% per annum, compounded annually, over a maximum tenor of five years from the effective date. As at the date of disclosure, the outstanding loan amount is nil, and no security has been provided by MCFL Energy Projects Private Limited against the facility. The agreement does not confer on the lender any right to appoint directors or restrict changes in capital structure of the subsidiary.
Impact on Investors
Investors will note that this loan agreement is a related party transaction, given that MCFL Energy Projects Private Limited is a wholly-owned subsidiary of the listed entity. The company confirms the transaction is at arm's length. The disclosed terms indicate that up to Rs 19 crore of the parent's funds may be deployed as an unsecured loan, meaning no collateral backs the facility should the subsidiary encounter financial difficulty.
The filing shows that the broader board-approved investment envelope for the subsidiary is Rs 30 crore, of which this loan agreement represents the first disclosed tranche. Shareholders will observe that this commitment is incremental to the company's core apparel business and introduces exposure to the energy project development segment through the subsidiary structure.
Sector / Market Context
The KUSUM-C (Kisan Urja Suraksha evam Utthan Mahabhiyan Component-C) scheme is a Government of India initiative administered by the Ministry of New and Renewable Energy, designed to support the solarisation of agricultural feeders and promote decentralised renewable energy generation. India's cumulative installed solar capacity has been expanding significantly, with the country targeting 500 GW of non-fossil fuel-based power capacity by 2030 according to government policy documents. Corporate participation in the KUSUM scheme through subsidiaries or special-purpose vehicles has grown as businesses seek to align capital allocation with India's broader clean energy transition goals.