Patanjali Foods Share Price Big Blow to Ramdev Baba; Important news! Big shock to Ramdev Baba, big action from exchanges; Find out why

New Delhi: The promoters of Patanjali Foods, a subsidiary of Patanjali Ayurveda, have been hit hard by the exchanges. Exchanges have frozen the shares of promoters and promoter companies, i.e. their transactions have been banned. This was disclosed in an exchange filing on March 15. These restrictions have been imposed due to non-fulfillment of minimum conditions of public shareholders.

According to the current information, the stock exchange has frozen 29.25 crore shares of Patanjali Foods. Patanjali Ayurveda is also one of the 21 promoters and promoter companies whose shares have been banned. On the other hand, today on March 16, the company has made its stand that if these shares are locked-in till April 2023, the action of the exchange will not have any special impact.

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What is the minimum share holding rule?
According to market regulator Securities and Exchange Board of India (SEBI) norms, at least 25 percent of the shares of a listed company must be held by public shareholders. Not so with Patanjali Foods. As per the shareholding pattern for December 2022 quarter, 80.82 percent shares of Patanjali Foods are held by promoters and promoter companies. Public shareholding is only 19.18 percent.

Earlier this company was Ruchi Soya. In 2017, the National Company Law Tribunal initiated insolvency proceedings for Ruchi Soya and in 2019, Patanjali Ayurveda’s Sankalp Yojana was approved by the tribunal. After the implementation of this plan, Ruchi Soya became Patanjali Foods and the public shareholding came down to 1.10 percent. As per the rules, there is a three-year period after the insolvency proceedings to bring the public shareholding to at least 25 per cent.

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The company had floated a follow-on public offer (FPO) in March 2022 to meet the norms of public shareholding, after which the public shareholding rose to 19.18 per cent. But since this stake has not increased, the exchanges have now taken action for not fulfilling the condition of raising the public shareholding to at least 25 percent in three years.

Explanation of Patanjali Foods
The stock exchange’s actions will not have any impact on the financial position of Patanjali Foods, the company said. According to the company, promoter shares are locked-in till April 8, 2023 as per SEBI norms. As such, the action taken by the exchange will not have much impact on the company. But the company will settle the minimum shareholding terms in the next few months.