Financial Insights

SEBI tells Ruchi Soya to allow investors to withdraw their bids

The Securities Exchange Board of India (SEBI), India’s capital markets regulator, has asked Ruchi Soya Industries to let the investors withdraw their bids if they like from its FPO on account of “circulation of unsolicited SMSs advertising the issue”.

Directed towards the investment bankers of the issue, SEBI said that the contents of the unsolicited SMSs are fraudulent, misleading and not in accordance with SEBI regulations. Therefore, a brief window to allow investors to withdraw their bids will be provided from March 28-30.

The FPO saw great participation. The Rs 4300 crore FPO was subscribed 3.6x times. The employee quota was subscribed nearly 8 times, whereas the HNI portion was booked 11.75 times. The retail portion fetched 90 per cent bids, whereas the QIB portion was subscribed 2.2 times.

The foreign investors, which received allocation under the anchor investor portion of the FPO, include Societe Generale, BNP Paribas, The Sultanate of Oman, Ministry of Defence Pension Fund, Yas Takaful PJSC (an Abu Dhabi based insurance company), MK Cohesion, UPS Group and Alchemy.

This move could be harmful as withdrawal of too many bids could potentially lead to the FPO being a failure. Moreover, this could lead to an imminent delay in the listing process of these shares.

Highlight by Aman Agarwal.

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