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Home / Business / Reliance Industries raises stake in HFCL to 5 per cent

Reliance Industries raises stake in HFCL to 5 per cent

The company offered over 8.72 crore shares to 21 institutional buyers at a price of Rs 68.75 per share, raising Rs 600 crore through the issue
Representational image.
Representational image.
File photo

Our Bureau   |   Mumbai   |   Published 11.12.21, 01:00 AM

Reliance Industries has raised its stake in HFCL (formerly Himachal Futuristic Communications Ltd) — the country’s largest integrated telecom network provider —to 5 per cent by investing

Rs 138 crore in shares that the company offered through the qualified institutional placement (QIP) route.

The company offered over 8.72 crore shares to 21 institutional buyers at a price of Rs 68.75 per share, raising Rs 600 crore through the issue.

Reliance Ventures acquired just over 2 crore shares or 23 per cent of the QIP shares on offer. Quant Mutual Fund, BNP Paribas, Elm Park Fund and Societe Generale are the other investors.

RIL earlier held a 3.76 per cent stake in the company through its subsidiary, Reliance Strategic Business Ventures.

HFCL’s fund raising committee met on Friday and approved the issue and allotment of 8,72,72,727 shares to the QIPs.

HFCL will use the proceeds to expand its optical fibre capacity, meet capital expenditure requirements for defence facilities that it manages, pay back debt, upgrade R&D facilities and cover its long-term working capital requirements.

The QIP issue had opened on December 6 and closed on December 9, it added.

The stock fell 6 per cent to Rs 86.80 on the Bombay Stock Exchange at the end of a volatile trading session after opening strong at Rs 92.20 and climbing to a high of Rs 93.70.

The stock has yielded a 1-year return of 300 per cent from a year-ago level of Rs 21.85, against a sectoral average of 27.3 per cent and a Sensex return of 27.91 per cent.

HFCL, which recorded revenues of Rs 4,423 crore in the year ended March 31, set up a new R&D centre in Bangalore last year to develop next generation 5G compatible products and system integration services.

It is also looking to develop anti-drone technologies and hopes to create a new platform for revenue growth by producing innovative products like electronic fuses and electro-optics devices for the defence sector. The electronic fuse is a device used in ammunition to initiate an explosive function and to detonate or release the missile or bomb.



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