The shares of CCL Products
(India) Limited rose by 13 per cent during early trading hours on Friday after the company informed the stock exchanges that the Reserve Bank of India (RBI) has approved increasing the firm's investment limit for foreign institutional investors (FIIs) and foreign portfolio investors
(FPIs) to 40 per cent, from its earlier cap of 24 per cent.
The approval was granted under the Portfolio Investment Scheme. CCL had in June 2017 approved a resolution seeking an increase in its FII/FPI limit during the firm's annual general meeting. The pitch was made after investments from foreign portfolio investors
reached the existing limit.
"We had decided to enhance the FII/FPI investment limit under pressure from these investors who seek to further increase their exposure in the company. This comes as an opportunity to reinforce the market capitalisation of CCL Products," a senior CCL official told Business Standard.
Engaged in the manufacturing of instant coffee products that are targeted at export markets, CCL currently has a combined production capacity of 35,000 tonnes per annum. The 5,000-tonne green-field plant that would come up in Andhra Pradesh's Chittoor district would take its total production capacity to 40,000 tonnes per annum by next year.
CCL set up India's first freeze-dried instant coffee manufacturing plant in 2005. It reported Rs 708-crore revenues in the financial year 2016-17.
Public shareholding in the company stands at around 55 per cent. Out of this, the firm's 56 foreign portfolio investors
hold around 23.75 per cent shares. Another 10.5 per cent shares are held by foreign individuals and NRIs, while 45 per cent shareholding belongs to the promoters group. FPIs
look to enhance their exposure as there was enough stock in the hands of the public.
The company scrip closed at Rs 302.65, up 6.32 per cent or Rs 18 over the previous close on Friday.