Patanjali Foods Shares Hit 5% Upper Circuit, OFS Opens For Retail Investors

Shares of Patanjali Foods hit the 5 per cent upper circuit at Rs 1,225 in Friday’s trade on BSE after its promoter, Patanjali Ayurved, offered to sell 7 per cent in the listed FMCG company.

At 12:05 PM, the stock was trading at 1,225.95 on the Bombay Stock Exchange (BSE).

The offer-for-sale (OFS) was to be executed over two days, with the offer opening for non-retail investors on 13 July and for retail investors on 14 July.

According to an exchange filing, Patanjali Ayurved is looking to sell up to 7 per cent stake or 2.53 crore shares at a floor price of Rs 1,000 per share, which is at a discount of around 19 per cent to Wednesday’s close of Rs 1,228.05.

Patanjali Ayurved will raise at least Rs 2,533 crore through the issue.  

The FMCG firm was supposed to sell an additional 2 per cent stake in case there was an oversubscription. On 13 July, the promoter entity said that it would not utilise the 2 per cent greenshoe option. It did not disclosed the reason behind the decision.

"We wish to intimate the Stock Exchanges of our intention not to exercise the Oversubscription Option. Accordingly, the total Offer size will be the Base Offer Size," the promoter of the company Patanjali Ayurved said.

"Consequently, 25,33,964 equity shares would be reserved for allocation to Retail Investors, subject to receipt of valid bids, as part of the Offer on July 14, 2023," it added.

At present, Patanjali Ayurved owns 39.97 per cent stake in Patanjali Foods. The latter company’s public holding is 19.18 per cent, around 6 per cent less than SEBI’s minimum public shareholding norm of 25 per cent.

In March, the bourses frozen 29.25 crore shares of promoter group companies of Patanjali Foods for not meeting the minimum public shareholding norm within the stipulated deadline.