Balrampur Chini Buyback 2020

(i) India is the second-largest sugar producer and the largest sugar consuming country in the world. Balrampur Chini Mills Limited is one of India’s largest integrated sugar manufacturing companies.

(ii) What makes Balrampur Chini Mills Limited (BCML) special is that it is more than a sugar company.It is also engaged in the ancillary businesses of ethanol manufacture and co-generation.

(iii) The Company’s 10 factories in Uttar Pradesh possess

a)  An aggregate cane crushing capacity of 76,500 tonnes per day

b) Distilleries possessing an aggregate capacity of 360 kilolitres per day

c) The saleable co-generation capacity of 163.20 megawattsBCML is more than just another industrial entity; it is a rural prosperity driver.

Buy Back Offer Deal:

Buyback Type: Tender Offer
Buyback Record Date: Jul 03 2020
Buyback Opening Date: Jul 20 2020
Buyback Closing Date: Jul 31 2020
Buyback Offer Amount: ₹ 180
Date of Board Meeting approving the proposal: Jun 23 2020
Date of Public Announcement: Jun 23 2020
Buyback Offer Size: 7.79%
Buyback Number of Shares: 10000000
Price Type: Tender Offer
FV: 1
Buyback Price: ₹ 180 Per Equity Share

Details of Buyback:

The Board of Directors of the Company at its meeting held on 23.06.2020 has interalia approved a proposal to buy back up to 1,00,00,000 Equity Shares of the Company, being  7.79% of the total paid-up equity share capital and free reserves of the Company, for an aggregate amount not exceeding Rs.180 Crores at Rs. 180 under the "Tender offer" route using the stock exchange mechanism.

Salient financial parameters:

Particulars( Cr) Mar-15 Mar-16 Mar-17 Mar-18 Mar-19
Sales 2,987 2,757 3,460 4,343 4,286
Expenses 2,861 2,346 2,561 3,891 3,597
Operating Profit 126 411 899 452 689
OPM % 4% 15% 26% 10% 16%
Other Income 15 -127 -4 41 50
Interest 102 67 55 52 41
Depreciation 116 110 105 95 96
Profit before tax -76 108 735 345 602
Tax % 24% 7% 19% 33% 4%
Net Profit -58 100 593 232 576
EPS in Rs 0 4.09 24.49 10.14 25.21
Dividend Payout % 0% 0% 14% 25% 10%
Source: Screener.in

How to Participate in buyback?

1. Firstly to be eligible for the buyback the investor should have shares of Balrampur Chini Mills Ltd Buyback 2020 in demat or physical form as on record date [ 03.07.2020 ] 2. Once you have shares in demat, you can participate in the buyback process which is opening from [ 20.07.2020 to 31.07.2020 ] by selling your shares through your broker on NSE or BSE. 3. Then on [ 18.08.2020 ], the payment will be given to you for accepted shares and unaccepted shares will be returned to your demat account.

Profit from the buyback on the bases of acceptance Ratio:

Buy 1111 Shares at CMP of Rs. 135 [2,00,000/180=1111)
Acceptance Ratio 33% 50% 75% 100%
Amount Invested in Buyback 1,52,222 1,52,222 1,52,222 1,52,222
No. of Shares buyback 366 555 833 1111
BuyBack Profit 15738 23865 35819 47773
Profit 10.34% 15.68% 23.53% 31.38%

Recommendation:

Review and Recommendation of Balrampur Chini Mills Ltd Buyback 2020 by IZ team is: 3/10 Fair: 1-5 Good:5-7 Excellent: 7-10 [ There is a good upside of 25% from CMP of 135. So arbitrage is good. ] 2019 Buyback Final AR Analysis

Company Contact Details:

Registered Office: "FMC Fortuna", 2nd floor, 234/3A, A. J. C. Bose Road, Kolkata - 700020 CIN: L15421WB1975PLC030118 T: +91 33 2287 4749 F: +91 33 2287 3083

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