Godrej Industries today successfully completed its Rs 400-crore rights issue through the institutional placement programme (IPP) of 15.67 million shares, which got over-subscribed 1.67 times.
"We have completed the country's second IPP of 15.67 million Godrej Industries shares with around 17 investors participating in the issue with two-thirds of them being FIIs. The average price range was Rs 210 to Rs 235 (final price is yet to be made available by exchanges as the deal was done on both BSE and NSE)," V Jayashankar, senior executive director and equity capital markets head at Kotak Investment Banking, which managed the issue told PTI.
At the upper price band, the company would raise Rs 405 crore.
Shares of Godrej Industries shares closed down 0.75 per cent at Rs 231.15 after hitting an intra-day high of Rs 233.70 and a low of Rs 226.40 on the BSE today.
At 1.67 times, there was a demand for 26.29 million shares for the IPP issue, he said, adding the Godrej board will meet tomorrow to decide on the allotment price.
The Sebi allowed the institutional placement programme mechanism this January to help promoters divest their stake to 75 per cent without going through the second follow-on option.
After the IPP issue, the promoter's stake in Godrej Industries will come down to 75 per cent, Jayashankar said.
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When contacted, Godrej Group chairman Adi Godrej said, the proceeds from the issue will go into funding expansion as well as to retire debt.
Godrej also said the company has a debt of under Rs 500 crore as of the June quarter.
The company will issue up to 1,56,66,734 equity shares of Re 1 each with a right, besides an additional allotment of up to 15,66,673 equity shares in case of over subscription.
Godrej Industries' consolidated net profit had declined by 60.55 percent to Rs 43 crore for the fourth quarter ended March 2012. It had posted a net profit of Rs 109 crore during the same period of previous fiscal.
Total income stood at Rs 1,479 crore for the fourth quarter in the last fiscal, as compared to Rs 1,431 crore during the same period of previous fiscal.
For the year ended March 31, 2012, the company had posted a net profit of Rs 292 crore as against Rs 293 crore in 2010-11 fiscal.
The company's total income in FY12 rose to Rs 5,804 crore from Rs 4,602 crore in FY11.