Adani Enterprises stock was trading at Rs 2,982.95, up 3.63 per cent. This is in addition to a 4.2 per cent rise on the counter in the previous session. All eyes on are institutional investors, as the issue is scheduled to close today.
The Rs 20,000 crore Adani Enterprises follow-on public offer (FPO) gained traction on its final day, receiving 40% bids by 1 pm, but short of being completely subscribed. On Day 3, the issue has received bids for 1,83,55,956 shares out of a total offer size of 4,55,06,791 shares. The quota set aside for qualified institutional bidders received 68% of the subscriptions, compared to 81% for non-institutional investors. The employee quota received 33% more offers than the quota set aside for retail investors (8%) did.
As retail bids are anticipated to remain low as a result of the stock price dropping below the FPO price band of Rs 3,112-3,276 per share, Adani Enterprises is putting a lot of money on institutions and strategic investors.
Adani shares have witnessed a dramatic decline in value amid a slew of accusations and denials over the Hindenburg report, which accused fraud and stock manipulation within the Adani group. However, shares of Adani Enterprises have started recovering.
The stock was up 3.63 percent at Rs 2,982.95, as of 1.15 p.m. This comes on top of the counter’s last session increase of 4.2%. Institutional investors will be watching closely as the offering closes today.
IHC of Abu Dhabi announced on Monday that it will use its subsidiary Green Transmission Investment Holding to invest $400 million (about Rs 3,200 crore) in the FPO of Adani Enterprises. IHC announced that it would purchase 16% of Adani Enterprises’ $2.5 billion FPO. Adani Enterprises’ stock increased 5.26% to a high of Rs 3,030.
Even while individual investors are sensitive to share price fluctuations, long-term institutional and strategic investors do not believe that Adani Enterprises’ value has changed as a result of the recent decline, according to Adani Group CFO Jugeshinder Singh on BT TV.
He hoped that it would be resolved quickly.
If at least 90% of readers subscribe, the issue is declared successful.According to analysts, institutional demand could allow the Adani group some wiggle room to balance out oversubscriptions versus undersubscriptions in the retail and non-institutional investor categories.
The FPO committee of Adani Enterprises will meet on February 1 to approve the offer price and prospectus for the offer.
In a filing to the BSE, Adani Enterprises stated that if the offer price is less than the allocation price for anchor investors, the difference will not be financed to the anchor investors.
“An FPO may remain active for a maximum of 10 working days. However, rather than preserving shareholder wealth at this point, exercising this option could cause greater harm. The Adani group can consider underwriting the offer to cover any shortage in subscription, which will guarantee the FPO’s success. This is one approach. However, Sebi has set requirements for backing an FPO through the book-building process “Pioneer Legal’s Principal Associate, Sameer Raina, stated.