MUMBAI: The ongoing tussle between Adani Group and Hindenburg Research has dented the demand of Adani Enterprises’ Rs 20,000 crore follow-on public offer (FPO). On the second day, the FPO was subscribed just 3 per cent with the company receiving bids for 13,98,516 shares against the total issue size of 4,55,06,791 shares, showed the stock exchange data.
However, the follow-on offer got a major boost as Abu Dhabi’s largest listed company International Holding Company (IHC) said it would invest $ 400 million or Rs 3,200 crore in the FPO. The retail portion was subscribed just 4 % as the company received bids for 9,76,944 shares from retail investors as against 2,29,08,464 shares reserved for them.
High net worth individuals bid for 9,76,944 shares against the portion of 96,16,323 shares reserved for them. The response from qualified institutional investors was also weak as the company received bids for just 4,576 shares as against 1,28,21,336 shares on offer.
IHC will make the investment through its subsidiary Green Transmission Investment Holding RSC Limited, it said in a statement. “Our interest in Adani Group is driven by our confidence and belief in the fundamentals of Adani Enterprises Ltd; we see a strong potential for growth from a long-term perspective and added value to our shareholders,” said Syed Basar Shueb, CEO, IHC.
“The advantage of the FPO is the historical reference for the company’s earnings report, company’s management, business practices, and much data to bank on before making any investment decision,” he added.
The flagship entity of Adani Group is selling shares in a price band of Rs 3,112-3,276 apiece. Demand for the shares has been dented by concerns about Adani Group’s mounting debt and alleged irregularities raised by US-based Hindenburg Research.
Hit by these allegations, shares of Adani Enterprises (AEL) have fallen much below floor price of the FPO. Shares of AEL rose 4 % to close at Rs 2878.50 on the BSE on Monday.
Retail shareholders have a 35% reservation in the FPO at a discount of Rs 64 per share.
Now the company is hoping to get a good response from investors on Tuesday, the last day of the share sale.
However, the ongoing controversy has dented the sentiments of investors. Despite muted demand for the shares from investors, Adani Enterprises has said there would be no change in either the schedule or the pricing of the FPO.
LIC exposure less than 1% of AUM
MUMBAI: Allaying fears about its investments in Adani Group, Life Insurance Corporation of India (LIC) on Monday said its exposure in the conglomerate is less than 1% of its total asset under management (AUM) book value. The country’s largest insurer has registered strong gains from its investment in the group companies.
“The total purchase value of equity, purchased over the last many years, under all the Adani group companies is Rs 30,127 crore and the market value for the same as at close of market hours on January 27, 2023, was Rs 56,142 crore,” LIC said in a statement.
“Total AUM by LIC are over Rs 41.66 lakh crore as of September 30, 2022. Therefore, LIC’s exposure in the group, as of date, is 0.975% of LIC’s total AUM at book value,” it added.
LIC’s total holding under equity and debt is Rs 35,917.31 crore as of December 31, 2022 under Adani group of companies.