Patanjali-backed Ruchi Soya's follow-on public offer (FPO) aggregating to Rs4,300 crore is around the corner. The company will be in focus this week on stock exchanges ahead of its issue. Baba Ramdev today announced the ambition for making Ruchi Soya, which is the largest manufacturer of edible oil in India, "a global brand". The FPO is in line with SEBI's guidance for maintaining shareholding requirements on the promoters' front.
Ramdev said that the company is focused on rural distribution in India along with strengthening global reach.
On BSE, Ruchi Soya shares traded on a bearish tone today. Its shares settled at Rs910.10 apiece down by Rs94.35 or 9.39% today. The shares traded between the day's high and low of Rs948.70 apiece and Rs831 apiece.
Key 10 points of the FPO:
1. The FPO will open on Thursday, March 24, 2022, for subscription and will close on Monday, March 28, 2022.
2. The company has fixed a price band at ₹615 to ₹650 per share for its follow-on public offer.
3. The issue comprises fresh issuance of Equity Shares for an amount aggregating to ₹4,300 crore. The issue also includes a reservation of up to 10,000 Equity Shares for subscriptions by eligible employees.
4. Ruchi Soya is in consultation with the book running lead managers to the issue, consider participation by Anchor Investors in accordance with the SEBI ICDR Regulations, whose participation shall be one Working Day prior to the Bid/Issue Opening Date, i.e. Wednesday, March 23, 2022.
5. Under the issue, not more than 50% of the Offer shall be available for allocation to Qualified Institutional Buyers, not less than 15% of the Offer shall be available for allocation to Non-Institutional Bidders and not less than 35% of the Offer shall be available for allocation to Retail Individual Bidders.
6. Companies like SBI Capital Markets Limited, Axis Capital Limited, and ICICI Securities Limited are the book running lead managers to the issue.
7. From this FPO, promoters of the company seek to reduce their shareholding to comply with Sebi's guidance. Currently, under the Sebi direction, the minimum requirement for a public shareholding in a listed company should be 25%. That said, the FPO will support Swami Ramdev's Patanjali to adhere to the minimum shareholding rules.
8. At present, Patanjali owns 98.9% of Ruchi Soya while public shareholders own 1.1%. Post the FPO, Patanjali's shareholding in the edible oil manufacturer will reduce to 81% while public shareholding will rise to 19%.
9. An FPO is similar to an initial public offering (IPO). A listed company opts for FPO to issue additional shares to the public after their IPO. Just like the initial public offer, FPO also enables listed companies to raise additional capital and reduce promoters' shareholding.
10. The Company is a diversified FMCG and FMHG focused company, with strategically located manufacturing facilities and well-recognized brands having a pan India presence. It is recognized amongst the largest branded oil packaged food company.
