DELHI – Ruchi Soya shares jumped 13% in early trade Monday after the edible oil producer announced a follow-on public offering (FPO) on March 24 to fund up to Rs 4,300 crore.
Ruchi Soya's stock rose to Rs 899.40 from Rs 803.15 at the previous close on the NSE. The stock went up 10% yesterday night.
"The FPO consists of 4,300 equity shares of Rs 2 each. The issue also reserves up to 10,000 equity shares for qualifying employees. If this is done, the next size will be smaller "Ruchi Soya stated.
The edition ends March 28.
The company is launching the additional public offering to meet the market regulator SEBI's 25% public shareholding requirement.
Patanjali Group currently owns 98.9% of Ruchi Soya. 1.1 % is owned by the public. After the FPO, Patanjali Group's stake in Ruchi Soya will be at 81%, while the public will be around 19%.
The profits will be used to settle outstanding loans, cover working capital requirements, and other general corporate purposes, according to Ruchi Soya.
Ruchi Soya is a key player in the Indian soya food market. The company introduced Nutrela in the 1980s.
Ruchi Soya benefited from Patanjali's nationwide distribution network and strong position in the fast-moving consumer goods sector when Patanjali bought it.