The follow-on public offer (FPO) of Patanjali Ayurved-backed Ruchi Soya has been subscribed 2.61 times so far on the last day of the bidding. As of 2:51 pm, the FPO received 12.78 lakh crore bids as against 4.89 lakh crore shares offered.
The retail individual investors (RIIs) quota was subscribed 79 per cent (0.79 times). The qualified institutional buyers (QIBs) and non-institutional investors portions were subscribed 1.53 times and 8.32 times, respectively.
The edible oil firm had raised Rs 1,290 crore from anchor investors ahead of its FPO. Ruchi Soya has aimed to mop-up Rs 4,300 crore to "become a debt-free company."
In 2019, Patanjali acquired Ruchi Soya, which is listed on the stock exchanges, through an insolvency process for Rs 4,350 crore.
The FPO issue is to meet market regulator SEBI's norm of minimum public shareholding of 25 per cent in a listed entity.
Patanjali promoters currently own a nearly 99 per cent stake in Ruchi Soya. They need to dilute a minimum 9 per cent stake in this round of the FPO.
As per the Securities and Exchange Board of India (SEBI) norms, the company needs to bring down promoters' stake to achieve the minimum public shareholding of 25 per cent. It has around three years to pare promoters' stake to 75 per cent.
The company fixed a floor price of Rs 615 to Rs 650 per equity share for the issue. It offered shares with a face value of Rs 2 each with a minimum bid lot of 21 and in multiples of 21 equity shares thereafter. The FPO opened on March 24.
As per the draft red herring prospectus (DRHP), Ruchi Soya plans to utilise the entire issue proceeds for furthering the company's business by repayment of certain outstanding loans, meeting its incremental working capital requirements and for other general corporate purposes.
FPO is an additional share sale offer, while an IPO or initial public offering is the first sale of shares of a company.