NDTV shares hit 5% upper circuit for fifth day

Shares of New Delhi Television Ltd (NDTV) were locked in the upper circuit for the fifth straight day, up 5% to a fresh 52-week high of ₹467.25 on the BSE after billionaire Gautam Adani’s Adani Group launched an open offer to take control of the media firm. In the last six sessions, the media stock has rallied 31.5%, as compared to a 0.4% rise in the S&P BSE Sensex. On the other hand, Adani Enterprises, the holding company of media and publishing subsidiary AMG Media Networks, gained 6.9% during this period.

NDTV shares have witnessed a strong rally since August 24 after AMG Media Networks, the media arm of Adani Group, indirectly acquired a 29.18% stake in the news and broadcast company, which triggered an offer for an additional 26% controlling stake. If succeeded, Adani Group's stake in NDTV will rise to 55.18%, making it the largest shareholder in the media firm. The company has proposed to acquire shares at a floor price of ₹294 per share, a 37% discount to the current market price, for a total consideration of up to ₹492.8 crore payable in cash.

On August 23, Adani Group, led by Gautam Adani, the third richest person in the world, announced to buy 29.18% shares in NDTV through Vishvapradhan Commercial Pvt Ltd (VCPL), a wholly owned subsidiary of AMG Media Network, the media arm of Adani Enterprises. VCPL exercised the right to acquire 99.5% of the equity shares of RRPR Holding, a promoter entity of NDTV, which owns a 29.18% stake in the media group.

However, NDTV has raised concerns over the acquisition, saying that the Adani group acquired the news network without any discussion with the company or its founder-promoters Radhika and Prannoy Roy. The company in an exchange filing said the Adani group needs prior approval from India’s capital markets regulator Securities and Exchange Board of India (SEBI) to complete the acquisition as its founders and promoters Prannoy Roy and Radhika Roy are barred from buying or selling shares. In an order dated November 27, 2020, SEBI has barred Prannoy Roy and Radhika Roy from accessing the securities market for a period of 2 years, which expires on November 26, 2022.

Meanwhile, Adani Group in a recent exchange filing clarified that the owners of NDTV do not need any such approval to complete the deal.

RRPR Holding has approached SEBI to seek clarity on VCPL's conversion of warrants into equity shares.

As per the latest shareholding, Prannoy Roy owns 15.94% in NDTV, while Radhika Roy’s holding is 16.32%, taking their total to 32.26%. They own additional 29.18% shares in the company through RRPR Holdings – abbreviated for Radhika Roy and Pranay Roy.