Muristek
FPO share price keep well below market price to give good returns: Ramdev
New Delhi, March 24
Patanjali Ayurved-owned Ruchi Soya on Thursday opened its follow-on public offer (FPO) to Rs 4,300 crore from the capital market to become a debt-free company. The issue will close on March 28 with the price band at Rs 615 to Rs 650 per share.
The proceeds of the FPO would be utilised to retire the term loan of Rs 3,300 crore so that Ruchi Soya becomes debt-free.
Asked why the price band has been kept lower than Wednesday's share price of Rs 897, yoga guru Ramdev said at a press conference here that this was done to give good returns to investors.
The company has already raised Rs 1,290 crore from anchor investors and Ramdev expressed confidence that the FPO would be successful as people trusted its products.
The combined annual turnover of Patanjali Ayurved group and its subsidiary Ruchi Soya is around Rs 35,000 crore and the target is to become India's number one food, FMCG and agriculture company in the next five years, said Ramdev.
Patanjali Ayurved will also demerge all its food businesses into the listed entity Ruchi Soya Industries. There will be several more public offers as Ramdev has lined up plans to list several other companies under the Patanjali group.
Ruchi Soya was acquired by the Patanjali group for Rs 4,350 crore through an insolvency process.
In 2020-21, Patanjali Ayurved had posted a turnover of Rs 9,783.81 crore, while other group entities registered a turnover of over Rs. 4,000 crore including Patanjali Natural Biscuits (Rs 650 crore), Ayurveda arm Divya Pharmacy (Rs 850 crore), Patanjali Agro (Rs 1,600 crore), Patanjali Parivahan (Rs 548 crore) and Patanjali Gramoudyog (Rs 396 crore).
Ramdev said Ruchi Soya and Patanjali Ayurved will not compete with each other. Patanjali Ayurved plans to transfer all food business to Ruchi Soya while the parent company will operate in non-food, traditional medicine and wellness space. Ruchi Soya will focus on edible oil, food amp; FMCG, nutraceuticals and oil palm plantation.