The price of Reliance Industries Ltd’s rights entitlement (RIL RE) surged 46.7% in seven trading sessions on the special platform for them, which closed on Friday. The rights entitlement opened for trading on 20 May along with the ₹53,125-crore RIL rights issue.
The rights issue closes for subscription on 3 June. The issue has been priced at ₹1,257 per share.
RIL RE ended trading at ₹221.75 on BSE on Friday, down 2.29% from its previous close. The rights entitlement began trading at ₹151.9 apiece on 20 May.
Total turnover of RIL RE shares on the BSE is ₹627.93 crore and ₹1615.36 crore on the NSE.
The trading also saw participation from some institutional investors such as French bank Societe Generale, which bought 3.25 million rights entitlement through the stock exchange platform on 20 May.
This was the first time shareholders could freely trade their rights entitlement on a stock exchange platform, since Sebi allowed the same earlier this year. The trading window on stock exchanges allows shareholders to sell their rights entitlement to others interested in the issue. Intra-day trading is not allowed in the rights entitlement platform.
This platform gave shareholders an opportunity to gain some value of eligible RE shares. Until now, shareholders, who didn’t wish to apply, had to let their RE lapse or had to transfer it for free.
So far, the RIL rights issue has been subscribed 6.87%, with another three trading days to go for the closing of the offer.
The RIL rights issue allows an existing shareholder to buy one new share for every 15 held. According to the terms of the offering, buyers will have to pay 25% of the price at the time of subscription, 25% in May 2021 and the rest in November 2021.
On Thursday, Mint reported that state-run Life Insurance Corp. of India (LIC), the largest institutional investor in the Reliance Industries Ltd will invest ₹2,500-3,000 crore in the company’s ongoing rights issue. LIC holds a 6% stake in RIL.
This will be one of the largest investments by the insurer in any company’s rights issue so far.
Ahead of its rights issue, RIL’s subsidiary Jio Platforms attracted investments worth $10 billion in a month from marquee investors.