Future Enterprises hits 5% upper circuit as board to consider raising funds

Other Future Group companies' stock also rallied on the development, with Future Retail surging 7 per cent

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SI Reporter New Delhi
2 min read Last Updated : Aug 27 2020 | 10:18 AM IST
Shares of Future Enterprises (FEL) were locked in 5 per cent upper circuit at Rs 19.25 on the BSE on Thursday after the company said its board will meet on Saturday to take a call on raising of funds.

Other Future Group companies' stocks also gained in trade. Future Retail (FRL) jumped 7 per cent at Rs 125.60 while Future Lifestyle Fashions Limited rose 4.7 per cent to Rs 137.85. Among others, Future Consumer Limited and Future Supply Chain Solutions  were both up over 2 per cent each. In comparison, the benchmark S&P BSE Sensex was trading 0.46 per cent higher at 9:44 AM.

In a notice to the stock exchanges, the company, yesterday, said that the board of directors would consider and evaluate proposals to raise funds by way of issuance of bonds including debentures/non-convertible debt instruments/securities and/or any other instruments / securities, including through private placement or through any other permissible mode or any combination thereof, as may be decided by the board. READ THE EXCHANGE FILING

According to this Business Standard report, the company's board would also look at the proposal to merge three other listed entities of the Future group with FEL. Once the merger is completed, Reliance Industries will invest Rs 8,500 crore to own 50 per cent stake in the merged entity. Global retail giant, Amazon, which owns stake in one of Future group's companies will dilute its stake and will not object to the transaction with RIL.

FRL is engaged mainly in home and electronics retailing and value retailing and operates Big Bazaar, Easyday, and Foodhall, among other format retail stores. The deal will also involve Future Consumer, which operates the food business, and has significant links with FRL, which is its largest customer, accounting for almost 80 per cent of its annual sales.

Similarly, Future Supply Chain Solutions provides supply-chain solutions (for non-agro products) to Future Group companies as well as to outside companies. The supply-chain company gets 65 per cent of its business from FRL.

Topics :MarketsFuture EnterprisesFuture ConsumerFuture GroupFuture RetailBuzzing stocks

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