Ruchi Soya will launch its follow-on public offer targeting to raise Rs 4,300 crores
MUMBAI, Mar 12 (The CONNECT) - Diversified FMCG and FMHG focused company, Ruchi Soya will launch its follow-on public offer (FPO) on March 24, the company said in its filing on the exchanges.
The FPO comprises equity shares of face value of Rs 2 each totally valued at Rs 4300 crore. The issue also includes a reservation of up to 10,000 equity shares for subscription by eligible employees. If such placement is completed, the follow-on size will be reduced. The issue will open on March 24 and close on March 28.
After filing a draft red herring prospectus (DRHP) in June 2021, the Securities and Exchange Board of India (SEBI) approved the public issue of the Ruchi Soya FPO in August 2021. To comply with Sebi's requirement of a minimum public shareholding of 25% in a listed business, the company is issuing a further public offering. It will take about three years to reduce promoters' stake to 75%. This FPO dilution will aid Baba Ramdev's Patanjali Ayurveda, which owns Ruchi Soya, in adhering to the minimum shareholding rules.
Currently, Patanjali Group owns about 98.9 percent stake in Ruchi Soya. Public shareholders own about 1.1 percent stake. Post the FPO, Patanjali Group’s holding in Ruchi Soya will come down to about 81 percent and the public would hold about 19 percent.
As per the DRHP, Ruchi Soya mentions it will utilize 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.
Ruchi Soya scroip closed at Rs 803.25 on Friday
Ruchi Soya is the largest player in branded palm oil with a share of 12% of the branded palm oil market in terms of value followed by Adani Wilmar with a share of 11%. Ruchi Soya’s ‘Ruchi Gold’ brand is the market leader in branded palm oil and also the pioneer of soya foods in India under the brand name of “Nutrela’, which Ruchi Soya launched in 1980s. Its brands are well recognised in the Indian market and include Ruchi Gold, Mahakosh, Sunrich, Nutrela , Ruchi Star and Ruchi Sunlight.
The company has Patanjali Biscuits, Noodles and Breakfast Cereals business – which makes it the only Patanjali group entity which will sell the entire range of Patanjali biscuits, Noodles and Breakfast Cereals under the brand of Patanjali itself. On the back of Patanjali gro.up’s more than 14 years experience in the nutraceutical and wellness space, Ruchi Soya has launched ‘Patanjali and Nutrela’ branded nutraceuticals.
Patanjali groups acquisition has enabled Ruchi Soya to benefit from Patanjali’s pan-India distribution network, significant technical know-how in the FMCG and FMHG sectors in India and group synergies amongst the wider Patanjali Group.
The edible oil firm competitors include Kuok, Cargill, Bunge, Cargill, Adani Wilmar, Conagra, National Dairy Development Board of India, Kaleeshwari Oil Mills Limited, Gokul, Emami, Liberty Oils Mills Vippy Industries Limited, Prestige Feed Mills and ADM Agro Industries Limited.
Recently Ruchi Soya showcased a strong Q3FY22 results, its total income grew by 40.79% on a YoY basis. EBITDA stood at Rs 440.89 cr with a margin of 7% inspite of the unprecedented commodity inflation. It has expressed plans to expand its existing product portfolio of nutraceutical products. It also received the Great Place to Work Certification by Great Place of Work Institute.
Book Running Lead Managers to the issue are SBI Capital Markets Ltd, Axis Capital Ltd, ICICI Securities Ltd.