State-owned ITI again extends FPO issue period

State-owned ITI on Friday extended the issue period for its ongoing follow-on public offer (FPO) by four working days till February 5 following lukewarm response from investors. This is the second time the company has extended its issue period.

Prior to this, the company, on January 28, extended the issue period for its FPO by three days till January 31. Also, it had reduced the price band to Rs 71-77 per share for its FPO from Rs 72-77 apiece. The FPO, which opened on January 24, was initially scheduled to close on January 28.

The company's follow-on public offer comprises fresh issue of up to 18 crore equity shares. Besides, an additional issue constituting up to 18 lakh shares reserved for employees. The issue was subscribed 58 per cent on Friday.

In a statement, ITI said, "There is an ongoing banking strike in the country and as per... Sebi issue of capital and disclosure requirements (ICDR) regulations which states that in case of any force majeure, banking strike or similar circumstance, the issuer may extend the issue period for a minimum of three working days". In accordance with regulation and keeping in mind the circumstances, the company said that the "FPO committee has decided to extend the bid/issue period by four working days. The bid/ issue closing date is now February 5, 2020. The price band will remain the same -- floor price of Rs 71 per equity share and the cap price of Rs 77 per equity share".

At the upper end of the price band, the company is expected to mop-up Rs 1,400 crore. Proceeds of the issue will be utilised towards working capital requirements, repayment of loan taken by the company and for general corporate purpose.

The public issue is being managed by BOB Capital Markets, Karvy Investor Services and PNB Investment Services. The FPO will help the company meet market regulator Securities and Exchange Board of India's requirement of minimum 25 per cent public shareholding.

ITI is into the business of manufacturing of a diverse range of information and communication technology products and solutions. Its customers include BSNL, MTNL, defence, paramilitary forces and state governments.