Ruchi Soya zooms 20% as co says SMSes pertaining to FPO not issued by it

Market regulator Sebi had directed Ruchi Soya to give the option to the FPO investors to withdraw their bids due to 'circulation of unsolicited SMSs advertising the issue'

Shares of Ruchi Soya spurted 20 per cent to Rs 978 apiece in Tuesday's intra-day trade on the BSE, but pared gains later, after the company clarified that the SMSes pertaining to investments in its follow-on public offering (FPO) have not been issued by the company or its promoters.

At 11:11 AM, shares of the company were up 12.5 per cent on the BSE, at Rs 917, as against a 0.34 per cent rise in the benchmark S&P BSE Sensex. With this, the stock snapped its 4-day losing run, having fallen 11 per cent during the period. Frontline Sensex index, meanwhile, has slipped 0.6 per cent during the period.

"We understand that there is a SMS/message in circulation in social media, speculating about investment opportunity in our company’s issue and about equity shares of our company being available at discount to the market price. We wish to bring to attention of the investors that this message has not been issued by our company or any of our directors, promoters, promoter group or group companies. A first information report bearing number 0188 dated March 27, 2022 has been logged by our company with a police station at Haridwar to take up investigation in respect of the message, under section 67A of the Information Technology Act, 2000 and section 420 of the Indian Penal Code, 1860,” Ruchi Soya said in a newspaper advertisement. CHECK HERE

The advertisement comes after the Securities and Exchange Board of India (Sebi) had directed Ruchi Soya Industries to give the investors who participated in its Rs 4,300-crore follow-on public offering (FPO) the option to withdraw their bids due to "circulation of unsolicited SMSes advertising the issue". READ MORE

In a letter to the three investment bankers handling Ruchi Soya's share sale, Sebi said the contents of the SMSs, prima facie, appear to be "misleading/fraudulent" and not in consonance with the ICDR (Issue of Capital and Disclosure Requirements) Regulations.

On its part, Ruchi Soya stated in the advertisement that the last day for withdrawal of bids will be Wednesday. The company also issued an indicative timeline for listing of the new shares that are being issued in the FPO. As per the timeline, the new share will list "on or about" April 8.

The Patanjali-backed edible oil company's FPO closed on Monday, garnering 3.6 times subscription. However, subscription levels fell on Tuesday with total subscription falling to 2.58 times. The total of 4.95 crore bids have been withdrawn.

As pe reports, the QIB subscription has reduces to 1.6x from close of 2.2x; the  HNI subscription has reduced to 9x from 11.75x; and the retail subscription has reduced to 0.4x from 0.9x.

Tech View

Ruchi Soya

Resistance: 982

Support: 850

Tuesday's spurt in Ruchi Soya's stock resulted in formation of a bullish engulfing candlestick on the daily chart. A jump to a high of Rs 977, also resulted in a test of its 200-DMA placed at Rs 982-odd levels. However, profit booking at higher levels indicate bulls are not in complete control of the stock.

Besides, a positive cross-over between 20 and 50-Day Moving Average (DMA) but a negative cross-over between 100 and 200-DMA on the daily charts further underlines the mixed sentiment at the counter.

As per the daily chart, the near-term resistance for the stock is placed at Rs 982-odd level, above which the next hurdle would be Rs 1,057 level; whereas support for the stock can be expected around Rs 850-odd levels, below which a the stock can slide to near Rs 710-odd levels. 

As per the weekly chart, the stock has formed a 'Morning Star' pattern, which is a positive sign. However, price-to-moving average action doesn't support a sustainable rally on the weekly charts as well. The 20-WMA has given a negative cross-over with 50-WMA, suggesting loss of momentum in the stock. 

The 14-day Relative Strength Index (RSI) supports near-term positive trend. However, convergence of Directional Index (DI), Slow Stockastic indicator, and a negative divergence of MACD depicts a period of consolidation.