The follow-on public offer of Ruchi Soya Industries has been subscribed 3.39 times on the final day of bidding. The FPO garnered total bids of 16.5 crore equity shares against the size of 4.89 crore equity shares.
The non-Institutional buyer's quota was subscribed 11.46 times while the qualified institutional investors' portion was subscribed 1.78 times. The company has reserved half of the offer for qualified institutional buyers and 15 percent for non-institutional investors.
The retail quota, which was 35 percent of the issue, saw an 84 percent subscription.
Employees' portion saw a subscription of 7.72 times their reserved portion.
The Patanjali-backed company had already mopped up ₹1,290 crore through the anchor book, out of the total fundraising aim of ₹4,300 crore.
The price band for the offer, which opened on March 24 and ended today (March 28), was fixed at ₹615-650 per share.
The company said it was launching the FPO in order to meet Sebi's minimum public shareholding norm. As per Sebi rules, the company has to decrease promoters’ stake to achieve the minimum public shareholding of 25 percent and it has around 3 years to do so. Currently, Patanjali owns 98.9 percent of the company while public shareholders own 1.1 percent. Post the FPO, Patanjali’s shareholding will reduce to 81 percent while public shareholding will rise to 19 percent.
The remaining 6-7 percent needed for the minimum public shareholding norm will be diluted before the Sebi deadline of December 2022, the company announced.
Incorporated in January 1986, Ruchi Soya Industries is one of the largest FMCG companies in the Indian edible Oil sector. Further, they are the largest manufacturers of soya foods under the brand Nutrela
In 2019, Patanjali Group had acquired the stock exchange-listed company through an insolvency process for ₹4,350 crore.
Most market experts were bullish on the FPO and said that investors can subscribe to the FPO with a long-term view since it is available at a significant discount.
Domestic brokerage KR Choksey believes that Ruchi Soya is drawing synergies post its acquisition with Patanjali which has led to favourable changes in the company’s business model. Being a pioneer in the soya products and edible oil business, the company’s focus on diversifying its product portfolio beyond oils will help it emerge as a strong player in the category, it added.