NDTV rights issue: Promoter cheque lands, bids jump to 76% with two days to go

New Delhi: NDTV’s rights issue saw a sharp step-up in applications on Monday afternoon, indicating the Adani promoter group has exercised its full entitlement. 

At 12:17 pm, the BSE screen showed cumulative ASBA bids of 3,68,25,336 shares against 4,83,53,450 on offer at Rs 82, taking visible subscription to about 76%. 

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At 5 pm on Friday, bids stood at 41,79,484 shares, roughly 9%. 

The single-session jump of about 3.26 crore shares broadly matches the promoters’ entitlement of 3,12,91,797 shares, signalling a 100% take-up by the Adani group.

At the issue price, Monday’s cumulative bids translate to about Rs 302 crore of applications in the system, up from Rs 34 crore on Friday evening. A full promoter take-up alone would account for roughly Rs 256.6 crore based on their exact entitlement. The offer remains open until October 8.

The surge comes with the stock still trading well above the offer price. NDTV’s last traded price on the BSE was Rs 114.30, leaving a discount of nearly 28% to the rights price and giving retail investors two more days to decide whether to apply or monetise their rights entitlements.

If public shareholders take their full pro-rata entitlement by Wednesday, the post-issue ownership mix will remain broadly unchanged. If the public finishes short and the board allots part of the residual to additional applicants, including the promoters, the promoter stake will rise modestly and the free float will tighten. 

Either way, proceeds should finish close to the Rs 396.5 crore target, because rights issues do not require 100% public subscription, and unsubscribed shares can be mopped up by those seeking additional allotment.

A large portion of promoter subscriptions is expected to circle back via the company as debt repayment, since NDTV has earmarked rights proceeds to repay inter-corporate deposits owed to the Adani group, alongside spends on marketing, content and general corporate purposes. 

Economically, that swaps short-term promoter debt into fresh equity on NDTV’s balance sheet.

With the promoter cheque landing, the book is roughly three-quarters covered, and the last forty-eight hours will show how much of the remaining ~Rs 95 crore comes from the public versus additional mop-up.