Ruchi Soya Industries, backed by yoga guru Baba Ramdev, has set a price margin of Rs 615-650 per share for its follow-up offering (FPO) of Rs 4,300 crore, which will be launched between March 24 and 28, 2022.

The edible oil company said the minimum offer will be for 21 shares and then in multiples of it. And the top end of the price range is Rs 650 per share, representing a 35 percent discount from Thursday’s closing price.

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Under the concept of the red herring prospectus, the shares will be credited on April 5 and trading will begin a day later, but the redemptions will start on April 4, 2022.

Ruchi Soya for its Nutrela product brand was purchased through insolvency process by Patanjali from Baba Ramdev in 2019 for Rs 4,350 crore.

The company is launching the public issuance to meet the Securities and Exchanges Board of India (SEBI) standard of a minimum public shareholding of 25 percent in a publicly traded entity.

According to the DRHP, Ruchi Soya will use all of the proceeds from the issuance to further the company’s business by repaying certain outstanding loans, to meet increasing working capital requirements and other general corporate purposes.

In 2019, Patanjali acquired Ruchi Soya, which is publicly traded, through an insolvency process for Rs 4,350 crore.

The promoters currently have a stake of almost 99 percent. The company must dilute a minimum 9 percent stake in this round of the FPO.

Under Sebi’s rules, the company must reduce the promoters’ stake in order to reach the minimum public shareholding of 25 percent. It has about three years to reduce the promoters’ stake to 75 percent.

(with PTI inputs)

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