Sebi gives investors an option to withdraw Ruchi Soya bids

This one of its kind rare instance, comes after the markets’ regulator noticed some unsolicited messages going out to Patanjali Ayurved Ltd’s users to invest in the said offer.  

 “Great news for all beloved members of Patanjali parivar. A good investment opportunity in Patanjali Group. Patanjali Group company- Ruchi Soya Industries Ltd has opened the Follow-On Public offer(FPO) for retail investors. The issue closes on 28 March 2022. This is available in the price band- ₹615-650 rupees per share , i.e discount of about 30% to market price. You can apply for shares through your bank/ broker/ ASBA/UPI in your Demat account”, the unsolicited message read.  

With regards to this, Sebi has directed the lead banking managers to issue a notice to all the investors in the form of advertisements in the newspapers cautioning investors of such circulation of unsolicited SMSes on Tuesday and Wednesday.   

Last week, Ruchi Soya hit the capital markets to raise nearly ₹4,300 crores through its follow-on public offer, in an attempt to make the company debt free. 

 Sebi said the withdrawal shall be available on 28 March-30 March. adding that the procedure for withdrawal should be disclosed to the investors. This should also be a part of the advertisements, Sebi said.  

Additionally, Sebi has asked the bankers to immediately notify the stock exchanges on circulation of such unsolicited SMS. This disclosure should clearly state the information pertaining to the window of the withdrawal available to the investors in the ongoing Follow-on public offer.  

A SMS has to be sent to all the applicants of the received bids, informing them about the additional window for withdrawal of these bids, the regulator directed.  

“As per the regulatory norms, an offer cannot be made without referring to an offer document which the unsolicited SMS did. The company also cannot proactively specify about the discount offered, since that is not precise in reality.  In addition, the company as per the message cannot claim that the offer is a “good investment” unless verified by an independent source. More importantly, the company also has to adhere to Sebi’s publicity guidelines while circulating such messages on the offer,” said a person with direct knowledge of the matter.  

The follow-on public offer (FPO) of Baba Ramdev-led Ruchi Soya Industries has been subscribed 3.8 times on the final day of bidding. On Monday the stock of Ruchi Soya was down 6.06% at 815.05 rupees. 

The follow-on public offer opened on 24 March and closed on Monday as the company looks to comply with Sebi’s requirement of increasing minimum public shareholding to 10%.  

Swaraj Singh Dhanjal contributed to the story