The massive share sale will help Gautam Adani to meet multiple targets. (file)
New Delhi:
Gautam Adani’s flagship is offering investors a 10 per cent-15 per cent discount in India’s biggest follow-on share sale as the billionaire tries to woo a wider set of supporters.
Adani Enterprises Ltd is looking to raise $2.5 billion by selling shares in the price band of Rs 3,112 to Rs 3,276, according to an exchange filing on Wednesday. Bloomberg News previously reported that large investors would get a 10 percent discount to the current market price, while retail investors would pay even less to buy into a company whose market value has nearly doubled over the past year.
About half the money will be spent on expanding Adani’s airport and renewable energy projects, while some 42 billion rupees – a little less than a quarter of the amount raised – will be used to reduce debt, the company said on Wednesday. Said earlier in the prospectus. Anchor investors can bid on January 25 and the rest from January 27 to January 31.
In a rare move to foreclose, Asia’s richest man will allow investors to pay for his purchase in installments. Bidders will have to pay 50% of the offer value as advance payment, followed by the balance amount in one or two installments. Retail investors will get a discount of Rs 64 per share.
The massive stake sale will help Adani meet multiple targets. Broadening his investor base would defend against accusations that his empire consists primarily of thinly traded stocks; Repaying debt addresses concerns about excess leverage; And winning over mom-and-pop investors will cement Mr Adani’s legacy as a wealth creator in a nation rife with income inequality.
Shares of Adani Enterprises have gained 95 per cent to Rs 3,596.7 in the last one year. The stock is trading at a valuation of 141 times its one-year forward earnings. By comparison, Reliance Industries Ltd — India’s largest firm by market value — trades nearly 20 times, according to data compiled by Bloomberg.
Chief financial officer Jugshinder Singh said in an interview in November, “We have created strategic capital. The next capital is patience capital.” “Indian mom-and-pop investors invest for their children and grandchildren.”
Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, an Adani Group company.
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