Adani Enterprises FPO offer: 10%-15% discount for investors

NEW DELHI: Adani Enterprises Limited(AEL), the flagship company of richest Indian Gautam Adani, on Wednesday filed an offer letter with stock exchanges for a proposed Rs 20,000 crore follow-on public offer (FPO).
Here is all you need to know about FPO:
*The FPO of Adani Enterprises Ltd (AEL) is planned to open on January 27 and close on January 31, according to the offer letter.
*The company is offering discounts of 10-15% to investors in its follow-on share sale.
*It approved a floor price of 3,112 rupees per share for the offer, with a price cap of 3,276 rupees for all categories of investors.
*Retail investors would get a discount of 64 rupees per share.
*In a rare move for a follow-on sale, investors can pay for their purchases in tranches. Bidders will have to pay 50% of the offer price as upfront payment, followed by one or two installments of the remaining sum.
*Of the Rs 20,000 crore proceeds of the FPO, Rs 10,869 crore will be used for green hydrogen projects, work at the existing airports and construction of a greenfield expressway. Another Rs 4,165 crore will go towards repayment of debt taken by its airports, road and solar project subsidiaries.
*Adani Enterprises’ shares have surged 95% over the past year to 3,596.7 rupees. The stock is trading at a valuation of over 141 times its one-year forward earnings. By comparison, Reliance Industries Ltd — India’s largest firm by market value — is at about 20 times, according to data compiled by Bloomberg.
*AEL operates and manages seven operational airports across the cities of Mumbai, Ahmedabad, Lucknow, Mangaluru, Jaipur, Guwahati and Thiruvananthapuram, and one greenfield airport in Navi Mumbai. It is also developing infrastructure projects such as roads in India.
*It had previously announced plans to invest $50 billion over the next 10 years in the green hydrogen ecosystem for the production of up to 3 million tonne of green hydrogen. Also, it plans to expand its solar module manufacturing capabilities at Mundra SEZ in Gujarat to up to 10 GW per annum.
*The AEL FPO offers comes amid some concerns about Adani group’s elevated debt levels and large promoter shareholding.
*As of September 30, 2022, it had Rs 40,023.50 crore in borrowings.
(With inputs from agencies)

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