Stock of Ruchi Soya rose over 7% in early trade after shares under the recently concluded follow-on public offering (FPO) started trading today.
About 66.15 million new shares issued in the Rs 4,300-crore FPO began trading today. Shares of Ruchi Soya zoomed 7.78% to Rs 882.55 against the previous close of Rs 818.85 on BSE.
Ruchi Soya stock opened with a gain of 3.8% at Rs 850 against the previous close of Rs 818.85 on BSE.
Ruchi Soya Industries stock is trading lower than 5 day, 20 day, 50 day, 100 day and 200 day moving averages. The stock gained 19.69% in one year and lost 1.23% in one year.
Total 7.10 lakh shares of the firm changed hands amounting to a turnover of Rs 60.35 crore. Market cap of the firm stood at Rs 30,298 crore.
Santosh Meena, Head of Research, Swastika Investmart said,”Ruchi Soya may see some selling pressure on an immediate basis as it will see unwinding in FPO arbitrage positions. Therefore, investors who applied for arbitrage gain, should book profit while long-term investors can remain invested because multiple positive things are going for the company, shortage of palm oil and oilseeds will improve the realisations which augur well for the profitability in the short to medium term. Technically, the 700 level should act as an immediate floor for the stock.”
The company’s board had cleared the allotment of 6,61,53,846 equity shares aggregating to Rs 4,300 crore. The allotment price for FPO was fixed at Rs 650 apiece. FPO investors withdrew nearly 97 lakh bids after markets regulator Sebi directed Ruchi Soya to give investors the option to withdraw their bids.
On April 5, the board approved the allotment of around 66.1 million shares to raise an amount of Rs 4,300 crore. The approval comes days after the company launched the follow-on public offer (FPO), which was subscribed 3.6 times.
Ruchi Soya conducted 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.