Patanjali Foods shares crack 5% after bourses freeze promotors' holding; CEO Sanjeev Asthana clarifies

Patanjali Foods Share Price: Yogi guru Baba Ramdev-backed Patanjali Foods shares cracked 5 per cent to Rs 917 today after the stock exchanges froze promoter holding of the company as they failed to comply with the public ownership criteria within the stipulated deadline. 

At present, the promoter stake in Patanjali Foods is at 80.82 per cent. As per the SEBI rule, the company had to increase its public shareholding from 19.2 per cent to 25 per cent. The freezing will be in effect until the minimum public ownership criteria as outlined by SEBI regulations are met.

The company on Wednesday said that stock exchanges have frozen 292.58 million shares of 21 promoter group entities for not meeting the SEBI norm. The exchanges have acted as per regulator SEBI’s master regulation, and as such, the SEBI would not act on such individual cases.

Patanjali Foods responded to the exchanges that the orders to freeze promoter entity shares would not have any effect on the company's overall financial performance.

The statement further said that promoters are fully committed to achieving the mandated minimum public shareholding and are discussing various methods to do so.

"They are confident of achieving mandatory MPS (minimum public shareholding) within a few months," the statement read.

In a conversation with Zee Business, Sanjeev Asthana, CEO of Patanjali Foods, said this is a technical matter. As per the rule, there should be 25 per cent holding with public shareholders. For that, "we had time till December 2022 but it could not happen as our holdings are already under a lock-in till 8 April 2023 as we got issuance last year only".

"As soon as we line up our investors, it will be unlocked as mentioned in SEBI letters also. It is expected to happen in the next 2-3 months," he said.