Ruchi Soya share price surges ahead of FPO listing

Ruchi Soya hit the capital market with its follow-on public offer (FPO) on March 24 to raise ₹4,300 crore as it aims to become a debt-free company. The price band of the issue, that closed on March 28, had been fixed at ₹615-650 per share. The Patanjali Ayurved-owned company last week had fixed the issue price of its FPO at the upper limit of its price band at ₹650 per equity share.

The company had already raised ₹1,290 crore from anchor investors last week by issuing around 1.98 crore shares. Meanwhile, nearly 97 lakh bids were withdrawn by FPO investors after markets watchdog Sebi directed Ruchi Soya to give investors the option to withdraw their bids, as per a PTI report.

Ruchi Soya came out with the FPO to meet Sebi's minimum public shareholding norm of 25% in a listed entity. The company said it would utilise the entire issue proceeds for furthering its business by repayment of certain outstanding loans, meeting its incremental working capital requirements and other general corporate purposes.

In August last year, the company 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. In 2019, Patanjali acquired Ruchi Soya, which is listed on the stock exchanges, through an insolvency process.