Shares of Patanjali Foods dropped 5 percent on Thursday, July 13 to hit a lower circuit following the company's announcement of launching an offer for sale (OFS) that enables Patanjali Ayurved, the promoter entity, to sell 2.53 crore shares at a floor price of ₹1,000 per share.
Patanjali Ayurved Ltd. will sell up to 2,53,39,640 equity shares of the edible-oil maker, accounting for 7 percent of the total paid-up equity share capital, the official filing stated.
As of now, the combined stake held by the promoter and promoter groups in Patanjali Foods stands at 80.8 percent. Within this, Patanjali Ayurved is the largest shareholder with a stake of 39.37 percent.
The offer for sale will be conducted over a two-day period, starting with non-retail investors being able to participate on July 13, followed by retail investors on July 14.
"Those investors other than retail investors who have placed their bids on T day and have chosen to carry forward their un-allocated bids to T+1 day, shall be allowed to revise their bids on T+1 day as per the SEBI OFS circular," the company noted.
In the event of oversubscription, the promoters have the option to sell an additional 2 percent, which would increase the issue size to a maximum of 3.25 crore shares.
During Thursday’s trade, the stock opened at a price of Rs. 1,165.10 per share to hit a lower circuit at the same price against the previous close of Rs. 1,226.40 per share.
The stock touched a 52-week-high of Rs. 1,495 on September 22, 2022, and a 52-week-low of Rs. 853.50 on March 20, 2023, indicating that at the current level, the stock is trading over 36.5 percent above its 52-week low and 22 percent below its 52-week high.
The stock has increased nearly 11 percent in the last one month. Moreover, in the past one year, it has gained over 12 percent.
Approximately 25% of the offer has been reserved for mutual funds and insurance firms. In the event that the shares allocated to this category remain unsubscribed, they will be made available to other bidders in the non-retail category.
Jefferies India and IIFL Securities have been appointed as the brokers for the offer for sale, as stated by the company.
The floor price of the OFS has been set at ₹1,000 per share, representing a discount of 14.1 percent compared to the prevailing market price.
The offer for sale of Patanjali Foods is projected to yield approximately ₹3,258 crore at the base offer price. This stake sale is being undertaken to adhere to the minimum public shareholding regulation, which mandates a 25 percent public shareholding.
Patanjali Foods Limited, formerly Ruchi Soya Industries Limited, is an India-based company, which is engaged in the edible oil business. The company is engaged in the manufacturing and marketing of a healthy range of edible oils and soya foods in India.
