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Oversubscribed 130%, RIL issue largest in the world in a decade by non-finance co
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SME Times News Bureau | 02 Jun, 2020
Reliance Industries Limited (RIL) rights issue oversubscription reached
129.8 per cent with one day still to go. As per data, applications for
8.8 crore plus shares were received on Tuesday.
Dealogic has put
together a list of USD 7 billion plus rights issues globally since the
financial crisis of 2008. It shows that the RIL rights issue emerges as
the world's largest by any non-financial company in last 10 years. RIL's
Rs 53,124 crore rights issue, oversubscribed on Monday itself, received
bids for another 8.8 crore shares on Tuesday taking cumulative demand
to nearly 54.9 crore shares - an oversubscription of 130 per cent,
according to stock exchange data.
The issue subscription data on
stock exchanges showed that at 5 pm on June 2, 2020, total bids received
for RIL's rights shares stood at 54.9 crore overshooting the 42.26
crore shares on offer by 29.8 per cent. Tuesday's large subscription
addition goes in line with the well-observed phenomenon that various
investor classes apply towards the end. The oversubscription figure
suggests that shareholders are applying for many more shares than their
entitlements.
This means, the final oversubscription number can
potentially rise to 1.6 – 1.8 times. Those subscribing to the rights
shares by June 3 can expect allotment of partly paid RIL shares by
Thursday, June 11 2020, in their demat accounts. These partly paid
shares will be separately listed on stock exchanges and their trading
will begin from Friday, June 12, 2020, according to the issue schedule
given in the Letter of Offer.
RIL has come out with a rights
issue first time in three decades to enable all shareholders participate
in its growth consumer/technology businesses, where new strategic
investors have started joining. Under the issue, shareholders will get
fresh shares of the company at a price of Rs 1,257 each and need to pay
the amount over 18 months in three instalments – 25 per cent on
application by June 3, 2020, 25 per cent in May 2021 and 50 per cent in
November 2021, making the issue most investor-friendly.
Reliance
Industries enjoys support of a very large number of shareholders. It has
over 25.4 lakh retail shareholders. Over 1,700 institutional investors –
domestic as well as foreign – are invested in the company. Earlier,
Reliance Industries created a whole new trading instrument in the form
of REs which had premium valuation, liquidity and interest engaging
quality investors.
The REs never traded at below intrinsic during
the renunciation period, which is a milestone in Indian capital
markets. (It is observed that right entitlements traded at an average 43
per cent discount to intrinsic value in similar issues of the recent
past.) RIL-REs created a value of Rs 9,500 crore for the company's
shareholders, when the online trading ended on Friday, May 29.
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Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
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66.20
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64.50 |
UK Pound
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87.50
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84.65 |
Euro
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78.25
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75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
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