Patanjali Foods shares hit 5% upper circuit after promoter sells stake

Shares of Patanjali Foods hit a 5 percent upper circuit after its promoter, Patanjali Ayurveda proposed to sell 2.53 crore equity shares or 7 percent in the listed Fast Moving Consumer Goods (FMCG) company.

The share price was up 5 percent at Rs 1,223.35 at 9.17 am on the National Stock Exchange. On July 13, the share hit a 5 percent lower circuit of Rs 1,166.65 after the Offer For Sale started. On the same day, 31 lakh Patanjali Foods shares changed hands, which is five times more than the company’s monthly average traded shares.

The offer will take place over two days in market hours via a separate window, July 13 for non-retail customers and July 14 for retail customers, said the company in an exchange filing. Floor price is set at Rs 1,000. It was announced on Thursday and is at a discount of around 19 percent to the previous close of Rs 1,228.05. Floor price is the minimum price at which a share can be sold.

The issue will fetch Patanjali Ayurveda at least Rs 2,533 crore.

Currently, Patanjali Ayurveda holds 39.97 percent stake in Patanjali Foods. The latter company’s public shareholding is 19.18 percent, almost 6 percent less than SEBI’s minimum public shareholding norm of 25 percent. In March, the stock exchanges had frozen 292.58 million shares of promoter group entities of Patanjali Foods for not meeting the minimum public shareholding norm within the stipulated deadline.

Patanjali Foods’ total revenue increased 31 percent year-on-year to Rs 31,821 crore in FY23. Net profit grew 9 percent year-on-year to Rs 886 crore in the same period. EBITA margins increased 33 basis points year-on-year in FY23.

Patanjali Foods, earlier named as Ruchi Soya manufactures edible oils and soya foods.

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