new Delhi. There has been a tremendous jump in the shares of Ruchi Soya on Monday. The stock has closed at its upper circuit of 963.75, up 20 per cent. This rise in the stock of Patanjali-owned Ruchi Soya has been seen after the company filed an application (RHP) with SEBI for Follow on Public Offer (FPO). The company is bringing an FPO of Rs 4,300 crore.
The stock of Ruchi Soya closed at Rs 803.15 on the National Stock Exchange on Friday. On Monday, it opened at Rs.887.70 with a gap-up opening and reached its upper circuit in no time.
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What is in its FPO
Let us inform that Ruchi Soya will sell 4,300 crore shares of fresh value of Rs 2 under this FPO. In this issue 10,000 equity shares will be reserved for the employees of the company. This issue will open on March 14 and close on March 28, 2022. SBI Capital Markets, Axis Capital, and ICICI Securitie are the book running lead managers of the issue.
Where will the company use the money
Ruchi Soya will use the money from this FPO to reduce debt, meet working capital requirements and for the normal functioning of the company. Through FPO, promoters of the company will reduce their stake to comply with SEBI guidelines. Under SEBI rules, there should be at least 25 percent public shareholding in any listed company. Through this FPO, Baba Ramdev’s Patanjali will follow the same rules of SEBI.
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Patanjali’s stake is 98.9 percent
Patanjali currently holds 98.9 per cent stake in Ruchi Soya, while the public shareholding is only 1.1 per cent. After this FPO, Patanjali’s holding in Ruchi Soya will come down to 81 per cent, while the public shareholder will increase to 19 per cent.
What is FPO
Any FPO is like an IPO. A listed company follows the FPO route to issue additional shares to the public after its IPO. Like IPO, through FPO also listed companies can increase their additional capital and reduce the stake of promoters in the company.
Tags: Patanjali Ruchi Soya, Share market
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