Patanjali Foods promoters to dilute 6% share to meet minimum shareholding norms

Patanjali Foods Ltd (PFL) on Wednesday said its promoters plan to sell shares to institutional investors in June for dilution of a 6 per cent stake to meet minimum public shareholding norms of 25 per cent. Patanjali Foods, formerly known as Ruchi Soya Industries, was acquired in September 2019 by Baba Ramdev's Patanjali Group through a corporate insolvency resolution process.

"We are planning to meet the minimum shareholding norms as prescribed by the market regulator SEBI," Ramdev said in an interview with PTI. He further said that the company was targeting to dilute around 6 per cent stake in June through Qualified Institutions Placement (QIP) and Offer for Sale (OFS). "We have already started the roadshow from Wednesday and there is a great interest from global investors," he said.

Currently, the public shareholding in PFL stands at 19.18 per cent, which needs to be increased to a minimum of 25 per cent. Shares of PFL, which has a market cap of nearly Rs 38,000 crore, settled at Rs 1,047.85 per scrip on BSE. 

The firm has, however, not disclosed how much it will raise through dilution of stake. PFL CEO Sanjeev Asthana said the amount will depend on the market condition and interest of investors. When asked about the preferred route for selling shares, he said, "Either it will be by QIP or a combination of QIP and OFS."

Earlier in March, stock exchanges NSE and BSE had frozen the shares of promoters of PFL, which is a major edible oil player. The company had then informed that leading bourses BSE and NSE had frozen shares of its 21 promoter entities for failing to meet minimum public shareholding norms.

On Tuesday, PFL reported a 12 per cent increase in its net profit to Rs 263.7 crore for the quarter ended March 2023. Its net profit stood at Rs 234.43 crore in the year-ago period. During the full 2022-23 fiscal, the net profit rose to Rs 886.44 crore from Rs 806.30 crore in the preceding fiscal. Its total income increased to Rs 31,821.45 crore in the last fiscal against Rs 24,284.38 crore in 2021-22.

(With inputs from PTI)