Patanjali Foods, a leading Fast Moving Consumer Goods (FMCG) company, experienced a 5% surge in its share price as its promoter, Patanjali Ayurveda, proposed to sell a 7% stake in the company. The share price reached Rs 1,223.35, hitting the upper circuit limit.
On July 13, the share prices dropped by 5%, reaching Rs 1,166.65 when the Offer For Sale began. The trading volume on that day was significantly higher than the company's average monthly trading volume.
The sale will take place over two days, with a floor price set at Rs 1,000. This offer is expected to generate a minimum of Rs 2,533 crore for Patanjali Ayurveda. Currently, Patanjali Ayurveda holds a 39.97% stake in Patanjali Foods, while the public shareholding is below SEBI's minimum requirement of 25%.
In FY23, Patanjali Foods achieved a 31% increase in total revenue, reaching Rs 31,821 crore. The net profit also grew by 9% to Rs 886 crore in the same period. The company witnessed an improvement in EBITA margins by 33 basis points in FY23.
Patanjali Foods, formerly known as Ruchi Soya, specializes in the production of edible oils and soya foods. The stake sale is expected to bring significant changes to the company's ownership structure and potentially impact its future growth trajectory.