Birlasoft Ltd Buyback 2022
Birlasoft combines the power of industry knowledge, enterprise solution and digital technologies to reimagine business processes for customers and their ecosystem. Its consultative and design thinking approach helps customers understand the value and outcome of the services being provided coupled with a transparent operating model. As part of The CK Birla Group, Birlasoft comprising of over 10,000 plus professionals, is committed to continuing its 158-year heritage of building sustainable communities.
Buy Back Offer Deal:
| Buyback Type: | Tender Offer |
| Buyback Offer Amount: | ₹ 390 Cr. |
| Date of Board Meeting approving the proposal: | May 27 2022 |
| Date of Public Announcement: | May 27 2022 |
| Buyback Number of Shares: | 78,00,000 |
| Price Type: | Tender offer |
| FV: | 2 |
| Buyback Price: | ₹ 500 Per Equity Share |
Details of Buyback:
The Company is is seeking approval of its shareholders by way of Special Resolution for buyback of up to 7,800,000 fully paid-up equity shares of face value of INR 2/- each ("Equity Shares") representing up to 2.79% of the total number of equity shares in the paid-up share capital of the Company, at a price of INR 500/- per Equity Share payable in cash, for an aggregate amount not exceeding INR 3,900 million/- (excluding transaction costs, applicable taxes and other incidental and related expenses) through the "tender offer" route as prescribed under the Securities and Exchange Board of India (Buy-back of Securities) Regulations, 2018, as approved by the Board of Directors of the Company at its meeting held on Monday, May 23, 2022 and as set out in the Notice of Postal Ballot dated Friday, May 27, 2022 ("Notice"), by way of Postal Ballot by voting through electronic means only ("e-voting"/ "remote e-voting").
Salient financial parameters:
| Particulars | Mar-16 | Mar-17 | Mar-18 | Mar-19 | Mar-20 | Mar-21 | Mar-22 |
| Sales | 3,224 | 3,320 | 2,250 | 2,551 | 3,291 | 3,556 | 4,130 |
| Expenses | 2,790 | 2,971 | 1,967 | 2,244 | 2,899 | 3,026 | 3,490 |
| Operating Profit | 435 | 349 | 283 | 306 | 392 | 529 | 640 |
| OPM % | 13% | 10% | 13% | 12% | 12% | 15% | 16% |
| Other Income | 16 | 47 | 87 | 100 | 43 | 19 | 66 |
| Interest | 17 | 14 | 8 | 11 | 16 | 13 | 13 |
| Depreciation | 69 | 83 | 40 | 50 | 83 | 80 | 77 |
| Profit before tax | 365 | 299 | 322 | 346 | 336 | 455 | 617 |
| Tax % | 23% | 20% | 21% | 16% | 33% | 29% | 25% |
| Net Profit | 281 | 239 | 253 | 289 | 224 | 321 | 464 |
| EPS in Rs | 14.22 | 12.08 | 12.8 | 10.56 | 8.11 | 11.57 | 16.59 |
| Dividend Payout % | 15% | 17% | 18% | 19% | 25% | 30% | 18% |
How to Participate in buyback?
1. Firstly, to be eligible for the buyback the investor should have shares of Birlasoft Ltd Buyback 2022 in demat or physical form as on the record date [-].
2. Once you have shares in demat, you can participate in the buyback process which is opening from [- to -] by selling your shares through your broker on NSE or BSE.
3. Then on [-], 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 400 Shares at CMP of Rs.372 ( 2,00,000/500=400)
| Acceptance Ratio | 33% | 50% | 75% | 100% |
| Amount Invested in Buyback | 1,48,800 | 1,48,800 | 1,48,800 | 1,48,800 |
| No. of Shares buyback | 132 | 200 | 300 | 400 |
| BuyBack Profit | 16,896 | 25,600 | 38,400 | 51,200 |
| Profit | 11.35% | 17.20% | 25.81% | 34.41% |
Recommendation:
Review and Recommendation of Birla Soft Ltd Buyback 2022 from our IZ team is: 5/10
[ The IPO size decent and good arbitrage of 34% is available in the buyback. Current Entitlement is 3% ]
7 Comments
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Experts,
Why birla soft equity and july future price wide difference like 8-9rs.
As promoters are not participating in this byback, so whether it will benefit to only general category or reserve category also? Kindly explain.
Sir,
When promoters are not participating in the buyback, it will benefit to the general category only. Promoters being the major stakeholders will be considered under the General Category.
Firm Entiletlement Ratio is around 7% in General Category if it converts to 20 to 30% AR than its a good deal
What about reserve category?
As Promoters are not participating AR may be high in General Category Compare to Retail Category
Would you please help in explaining this…
With promoters not participating, how it would benefit more in General Category than Retail Category. TIA