Adani Enterprises allots Rs 5,985-cr worth shares to anchor investors

Maybank, ELM Park large buyers in anchor category of FPO; MFs abstain

Adani Enterprises (AELs) on Wednesday allotted 18.26 million shares worth Rs 5,985 crore to over 39 institutional investors under the anchor segment as part of its Rs 20,000-crore follow-on public offering (FPO).

The allotment was made at Rs 3,276 apiece – the top-end of the price band. Shares of the AEL closed at Rs 3,390 apiece on Wednesday.

As the company is issuing partly paid up shares, AEL will collect Rs 1,638 per share from investors in the first tranche.

Maybank Securities alone subscribed for over a third of shares worth Rs 2,040 crore. ELM Park Fund, Winro Commercial, Belgrave Investment Fund and Dovetail India Fund Class were the other big investors subscribing to shares worth over Rs 300 crore each.

Among domestic institutions, LIC subscribed to shares worth nearly Rs 300 crore, while SBI Life Insurance got allotment for Rs 125 crore worth of shares and SBI Employees Pension Fund another Rs 100 crore.

Notably, not a single domestic mutual fund applied for shares in the anchor category. Market watchers said the allegations of market manipulation and accounting fraud against the Adani group by Hindenburg Research could have impacted their investment decisions.

 

The US-based research firm on Wednesday released its report the same day Adani Enterprises was to allot shares to anchor investors. The group called the report a “malicious combination of selective misinformation and stale, baseless and discredited allegations.”

AEL is offering an additional discount of Rs 64 per share for retail investors—those investing up to Rs 2 lakh.

AEL’s partly paid-up shares will be traded separately on the bourses. The company will collect the remaining 50 per cent from investors in one or more tranches over an 18-month period.

MFs have largely avoided Adani group stocks on concerns of stretched valuations and excessive leverage. As of September 2022, MF holding in Adani Enterprises was just 1.27 per cent and that too through their index funds and ETFs. As of December 2022, none of the active schemes of top 25 fund houses had any significant holding in Adani Enterprises.

Investment bankers said they expect MFs to participate in the FPO, which opens for subscription on Friday and closes on Tuesday.