New Delhi: Billionaire Gautam Adani-led group's Rs 20,000 crore share sale in its flagship firm sailed through on the last day after investors, some being family offices of the fellow industrialists, rallied behind the embattled tycoon, whose business empire has been rocked by allegations of fraud by a US short seller.
While the portion of a follow-on share sale in Adani Enterprises Ltd reserved for anchor investors was fully subscribed last week, institutional and other non-retail investors helped the offer reach desired subscription levels hours before the sale closed, according to data available from BSE. As many as 5.08 crore shares were sought against an offer of 4.55 crore, even though the offer price was higher than the rate at which the company stock was being traded on the stock exchange.
Non-institutional investors put in bids for over three times the 96.16 lakh shares reserved for them, while the 1.28 crore shares reserved for qualified institutional buyers (QIBs) were subscribed 1.2 times, according to BSE data. However, there was a muted response from retail investors and company employees.
Retail investors, for whom roughly half of the issue was reserved, bid for just 12 percent of the 2.29 crore shares earmarked for them. Employees sought 55 percent of the 1.6 lakh shares reserved for them. Overall, against 6.14 crore shares on offer, anchor and other investors bid for 6.45 crore.
Industry sources said that family offices of some of the top industrialists in the country made offers for the shares. Names of the investors could not be immediately verified. Adani also did not reveal the list of investors. While the success of the issue is a victory for Adani after Hindenburg's allegations called the offer into question, it is unlikely to fully allay investor concerns.
Foreign investors who picked up the shares included Abu Dhabi Investment Authority, BNP Paribas Arbitrage, Societe Generale, Goldman Sachs Investment (Mauritius) Ltd, Morgan Stanley Asia (Singapore) Pte, Nomura Singapore Ltd and Citigroup Global Markets Mauritius.
A slew of domestic institutional investors, including LIC, SBI Life Insurance Company, HDFC Life Insurance Company and State Bank Of India Employees Pension Fund, also participated in the anchor book.
Out of the Rs 20,000 crore proceeds from the FPO, Rs 10,869 crore will be used for green hydrogen projects, work at the existing airports and the construction of a greenfield expressway. An amount of Rs 4,165 crore will be utilised for repayment of debt taken by its airports, road and solar project subsidiaries.
(PSU Watch– India's Business News centre that places the spotlight on PSUs, Bureaucracy, Defence and Public Policy is now on Telegram & Twitter as well. Join PSU Watch Channel in your Telegram and follow us on Twitter to stay updated)