Shares of Ruchi Soya fell over 17 per cent in early trade today after the edible oil major fixed a price band of Rs 615-650 per share for its upcoming follow-on public offer (FPO). The higher end of the price band – Rs 650 a share – amounts to a 35 per cent discount from Thursday’s closing price.
The firm said the minimum bid will be for 21 shares and in its multiples thereafter. Ruchi Soya stock opened 17.27 per cent lower at Rs 831 against the previous close of Rs 1004.45 on BSE.
At 9:41 am, the stock was down 11.53 per cent to Rs 888.60 on BSE.
However, the stock has gained 4.13 per cent since the beginning of this year and risen 33.59 per cent in a year
Ruchi Soya shares trade higher than 20 day and 50 day moving averages but lower than 5 day, 100 day and 200 day moving averages. A total of 0.27 lakh shares of the firm changed hands, amounting to a turnover of Rs 2.32 crore.
Market cap of the firm fell to Rs 26,235 crore on the BSE. The stock hit a 52-week high of Rs 1,377 on June 9, 2021 and a 52-week low of Rs 619 on April 22, 2021.
The FPO, through which the company plans to raise Rs 4,300 crore, will open on March 24 and close on March 28. Shares of Ruchi Soya closed at Rs 1,004.45 on the BSE on Thursday.
The dilution through the FPO would help Baba Ramdev-led Patanjali Ayurveda, which owns Ruchi Soya, to adhere to the minimum shareholding norms. In August 2021, the firm had received capital markets regulator Sebi’s go-ahead to launch the FPO. It had filed the draft red herring prospectus (DRHP) in June 2021.
Ruchi Soya will utilise the entire issue proceeds for furthering the company’s business by repayment of certain outstanding loans, meeting its incremental working capital requirements and other general corporate purposes.
In 2019, Patanjali bought Ruchi Soya, which is listed on the stock exchanges, through an insolvency process for Rs 4,350 crore. Ruchi Soya primarily operates in the business of processing oilseeds, refining crude edible oil for use as cooking oil, manufacturing soya products, and value-added products.The company has an integrated value chain in palm and soya segments, having a farm-to-fork business model. It has brands such as Mahakosh, Sunrich, Ruchi Gold and Nutrela.