Ruchi Soya enters top-100 most-valued companies list; stock hits new high

The stock hit a new high of Rs 926 today, zooming 5400% since its re-listing on January 27, 2020.

Edible oils firm Ruchi Soya Industries has entered into the list of top-100 most valued companies in terms of market capitalisation (m-cap) after the stock of the company hit a new high of Rs 926 on the BSE today.

Shares of Ruchi Soya were locked in the upper circuit for the 12th straight day, up 5 per cent at Rs 926. At 09:55 am, the company stood at 94th position in the overall m-cap ranking on the BSE, the exchange data shows.

Currently, Ruchi Soya stands ahead of telecom services provider Vodafone Idea, tyre manufacturer MRF, state-owned mining company NMDC, liquor maker United Breweries and insurance company General Insurance Corporation of India.

Since January 27, 2020 -- when it was re-listed on the stock exchanges after consolidation of equity shares of the company -- the company's stock price has appreciated by nearly 55-fold from the level of Rs 16.90 on the BSE.

Currently, Ruchi Soya is trading under trade-to-trade or ‘T’ segment, where shares can be traded only for compulsory delivery basis. It means trade-to-trade shares cannot be traded intra-day. Each share purchased/sold, which are parts of this segment, needs to be delivered by paying full amount.

On May 22, 2020, rating agency Brickwork Ratings assigned BWR BBB+/Stable rating to the company’s long-term bank loan facilities.

The agency said the ratings assigned to Ruchi Soya factors-in its entrenched market position as a diversified and leading player in the edible oils segment in the country, mainly driven by its strong distribution network, well-known brands and manufacturing plants strategically placed at various oil seed producing and importing locations in the country, besides the successful Insolvency and Bankruptcy Board of India (IBBI) resolution that led to its acquisition by a consortium lead by Patanjali Ayurved, a well-established player in the food, herbal medicine and FMCG segments.

"Ruchi Soya’s liquidity position also remains adequate as on 9MFY20, considering the absence of fixed debt obligations during FY21, a low average collection period and the availability of unencumbered liquid assets of over Rs 380 crore for meeting its required working capital needs," Brickwork Ratings said in rating rational.

Besides, the management also plans to raise funds through a public offering of shares after the completion of the one year lock-in period as per Sebi guidelines. Furthermore, additional liquidity can be raised by the company by hiving off of its non-core assets and divesting a stake in subsidiaries as and when required, it said.