Adami Wilmar rebounds 12% post tepid debut

Adani Wilmar shares made a tepid start at Indian stock market, with stock price listing at 3.9% discount at ₹221 apiece, from its upper price band of ₹230 on the BSE. On the National Stock Exchange, the stock was listed at ₹227 per share, down 1.3% against the offer price. The FMCG company, which sells cooking oils under the Fortune brand, had fixed a price band of ₹218-230 a share for its initial public offering (IPO).

Post listing, Adani Wilmar share price rebounded strongly and gained as much as 12.5% from its issue price to hit a high of ₹258.65 on the BSE. There was spurt in volume trade as 38 lakh shares worth ₹92.75 crore changed hands over the counter by mid-session of day’s trade so far. The market capitalisation of the company stood at ₹33,616 crore.

The ₹3,600-crore IPO of Adani Wilmar received a strong response from investors as the issue was subscribed 17.37 times. The three-day public offer, which opened between January 27-31, got an overwhelming response from non-institutional investors as the quote set aside for them was subscribed 56.30 times. The portion for retail investors and qualified institutional buyers was subscribed 3.92 times and 5.73 times, respectively, as per the data available on the NSE.

Adani Wilmar, a 50:50 joint venture between Gautam Adani-led Adani Group and Singapore-based Wilmar, is the seventh Adani group company to join the exchange as six subsidiaries of the conglomerate are already listed on the domestic bourses. The list includes Adani Enterprises, Adani Green Energy, Adani Power, Adani Transmission, Adani Total Gas, and Adani Ports and Special Economic Zone.

On the financial front, the company reported a profit after tax (PAT) of ₹727.65 crore during the year ended March 31, 2021, compared to ₹460.87 crore in the previous fiscal. The total revenue of the company stood at ₹37,196 crore in FY21 as against ₹29,767 crore in the financial year ended March 31, 2020.

The company intends to use the IPO proceeds to fund capital expenditure for the expansion of existing manufacturing facilities as well as developing new units. A part of the fund will be also used to repay debts, fund strategic acquisitions and investments, and meet general corporate requirements.