MUMBAI: Adani Enterprises, the flagship company of Adani Group, is expected to file paper for its Rs 20,000 crore follow-on public offer (FPO) with the Securities and Exchange Board of India (Sebi) within two days.
Once the Gautam Adani-led firm gets green signal from its merchant bankers, the company will file the papers with the capital markets regulator. “The papers of this mega offer will be filed with Sebi either on Tuesday or on Wednesday.
The company is waiting for the approval of merchant bankers involved in this follow-on public offer,” a source told this newspaper. Earlier in November last year, Adani Enterprises’ Board of Directors had approved a decision to raise funds aggregating up to Rs 20,000 crore through FPO.
The offer is going to be the largest FPO by in the country by any company. Previously Yes Bank had raised Rs 15,000 crore through its follow-on public offer in 2020, making it the biggest such offer. An FPO is the process through which a company, already listed on the stock exchange, issues its shares once again to the public to raise funds.
The company doesn’t want to delay the FPO and the plan is to complete this offer before the annual Budget. “The aim is to finish the entire fundraising exercise before the Budget,” he said. It also aims to attract retail investors through this offer. In order to boost retail participation in the FPO, it is expected to give five to seven percent discount on the offer price to retail investors.
The company has faced criticism for lower level of retail investors’ participation. According to the Bombay Stock Exchange (BSE), the promoter’s shareholding in Adani Enterprises is at 72.63 percent while public investors hold 27.37 percent shares in the company.
The FPO will increase the public float of Adani Enterprises as more numbers of shares will be available for trading on exchanges. Apart from diversifying its investor base, the FPO will also help to meet its capital requirement and fund company’s expansion plans. The share of Adani Enterprises ended 2.8 percent lower at Rs 3,619 on the BSE on Monday.