Adani Enterprises FPO gets bids for 5,59,544 shares so far; here's what group CFO says

Adani Enterprises' Rs 20,000 crore follow-on public offer (FPO) received bids for 5,59,544 shares on Day 2 so far. The issue is subscribed 1 per cent of the total size of 5,41,772 shares, as of 10.21 am. The issue has received tepid response so far amid a sharp fall in shares of Adani Enterprises. While the scrip recovered some lost ground in Monday's trade, it is still trading below the FPO price band of Rs 3,112-3,276 per share.

Adani Enterprises in a filing to BSE said in the event of offer price being lower than anchor investor allocation price, the difference will not be funded to anchor investors. The FPO committee is scheduled to meet on February 1 for the approval of offer price and prospectus in relation to the offer. That said, Adani Group CFO Jugeshinder Singh said he is confident the Rs 20,000 crore issue will sail through and that his group was not looking to make any changes with respect to either price band or offer period.

Singh told Siddharth Zarabi of Business Today Television that group chose the fund raising mechanism carefully. He said the FPO mechanism gave Adani Enterprises the flexibility to fill the book based on the total subscription, which now will be led majorly by institutional and long-term strategic book.

He said while retail investors are sensitive to share price, long-term institutional, long-term strategic investors do not see change the value of Adani Enterprises post the recent fall.

At the time of filing this story, shares of Adani Enterprises were trading 5.33 per cent higher at Rs 2,909.25 against Rs 3,112, the lower end of the FPO price band.  

Singh said Adani Enterprises is not a normal corporate that trades on valuation parameters such as earnings multiples.

“It is an incubator. Its value comes from what it incubates. Adani Enterprises incubates airports, ports, green hydrogen, data centres, Adani Wilmar, Adani Digital Labs and Adani mining businesses. They are core businesses. Those businesses are the ones that have value. Adani Enterprises is the way to access that value. What people are interested is in getting the number of shares they can get in Adani Enterprises. The value will occur when we demerge the businesses and investors end up owning the similar number of shares based on ratios," Singh said.

Also read: Adani Enterprises FPO: Group CFO says significant participation likely from institutional, strategic investors

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