A day after the news came out that Patanjali Foods would acquire Patanjali Ayurved's non-food business, investors appeared to have rallied to make the most of the opportunity. The company shares was trading in green on Monday, July 1 and gained over 6 per cent by the end of the day's trade.
Patanjali Shares Drop After Gains
On Tuesday, July 2, the trend continued with a bit of lag before the stocks lost their momentum and slumped below 1 per cent.
Patanjali Foods, incorporated in 1986, is set to acquire the non-food business of Patanjali Ayurved, making room for greater leaps in the FMCG sector of the country. Patanjali Ayurved was founded by yoga guru Ramdev and his associate Balakrishna in 2006 as an umbrella parent organisation for its ventures.
The FMCG market, which was worth USD 110 billion in 2020, is expected to scale the USD 220 billion mark by 2025. |
According to Forbes, Balakrishna has a total net worth of USD 3.8 billion.
The new acquisition will focus on home and personal care brands. This deal is reported to be worth Rs 1,100 crore.
The brand would look to consolidate its position in a cutthroat FMCG market, that is dominated by big names like Hindustan Unilever, P&G and ITC, to name a few. The FMCG market, which was worth USD 110 billion in 2020, is expected to scale the USD 220 billion mark by 2025.
Patanjali's Legal Woes
The company name most recently made headlines when it was embroiled in legal turmoil, which saw the company being taken to the Supreme Court for misleading customers with its 'medicines' with its false promises on the medicines efficacy during the height of the pandemic.
The company, apart from duplicitously promoting its products, also tried to besmirch evidence-based medicinal science. The company and its promoters, Ramdev and Balakrishna, were asked to apologise in the matter. | PTI
The company, apart from duplicitously promoting its products, also tried to besmirch evidence-based medicinal science. The company and its promoters, Ramdev and Balakrishna, were asked to apologise in the matter.
After a relatively promising start to the day's proceedings on July 2, the company shares dropped to red territory. At the halfway mark (12:09 IST) the company shares dropped 0.81 per cent or Rs 14.40 of its value, taking the total value to Rs 1,684.95 per share piece.
