Investors, who were awarded shares in the public offering, made a profit of 36% as the counter hit a high of Rs 882.55, against its issue price of Rs 650.
Market experts suggest that investors who have called for an arbitrage gain should record profits while long-term investors can stay invested.
Santosh Meena, head of research at Swastika Investmart, said Ruchi Soya could see immediate selling pressure as she sees an unwinding of FPO arbitrage positions.
“There are several positive things for the company, which will improve achievements and bode well for profitability in the short and medium term,” he added. “Technically, the Rs 700 level should act as an immediate floor for the stock.”
The board of the company has approved the allotment of 6,61,53,846 shares with a par value of Rs 2 each, totaling Rs 4,300 crore. With the amount raised through FPO, Baba Ramdev’s Patanjali Ayurveda led Ruchi Soya to become a debt-free entity.
Ruchi Soya’s FPO was open for subscription between March 24 and 28, with the company selling its shares in the range of Rs 615-650 per share, with a minimum lot size of 21 shares.
The paid up share capital of the company increased to Rs 72.4 crore from Rs 59.16 crore earlier. The company has raised Rs 1,290 crore from senior investors, issuing around 1.98 crore shares at Rs 650 per share.
Ruchi Soya Industries stock jumped more than 8% in Friday trading. The title jumped 7.77% to Rs 882.55 on BSE. At the NSE, it gained 8.23% to Rs 885.