Ruchi Soya Industries shares plunge 17% intraday as company announces FPO price band

Shares of edible oil company Ruchi Soya slumped over 17 per cent to touch a day’s high low of Rs 831 per share on the BSE intraday during Monday’s trading session. The decline in the stock came a day after the company set price band of Rs 615-650 per share for its follow-on public offer (FPO). 

The stock at around 11:36 pm is trading over 9 per cent lower to Rs 911.05 per share on the BSE, as compared to 0.13 per cent fall in the S&P BSE Sensex. 

See Zee Business Live TV Streaming Below:

The Rs 4300-crore FPO, is scheduled to start from March 24 and will conclude on March 28, 2022. 

According to the draft red herring prospectus, the shares will be credited on April 5 and their trading will start a day after, however, the refunds will be initiated on 4 April 2022. 

The company is coming out with the public issue to meet Securities and Exchanges Board of India (SEBI)'s norm of minimum public shareholding of 25 per cent in a listed entity. 

As per the DRHP, 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, yoga guru Baba Ramdev-led Patanjali had acquired bankrupt Ruchi Soya Industries for the Nutrela brand of products through an insolvency process for Rs 4,350 crore. 

Ruchi Soya’s shares relisted on January 27, 2020 at Rs 16.10 per share and soared to a one-year high of Rs 1,535 on 29 June, largely on account of its extremely small public float. 

The stock in the last one year has outperformed the market by rising over 37 per cent as compared to around 16 per cent surge in the BSE Sensex. While it has gained nearly 12 per cent in one month as compared to flat benchmark index.