Bosch Limited Buyback Offer 2018

Bosch Buyback Offer 2018

Bosch Limited is a leading supplier of technology and services in the areas of Mobility Solutions, Industrial Technology, Consumer Goods, and Energy and Building Technology. Additionally, Bosch has in India the largest development center outside Germany, for end to end engineering and technology solutions.

The Bosch Group operates in India through twelve companies, viz, Bosch Limited, Bosch Chassis Systems India Private Limited, Bosch Rexroth India Private Limited, Robert Bosch Engineering and Business Solutions Private Limited, Bosch Automotive Electronics India Private Limited, Bosch Electrical Drives India Private Limited, BSH Home Appliances Private Limited, ETAS Automotive India Private Limited, Robert Bosch Automotive Steering India Private Limited, Automotive Services and Solutions Private Limited, New Tech Filters India Private Limited and Mivin Engineering Technologies Private Limited. In India, Bosch set-up its manufacturing operation in 1951, which has grown over the years to include 18 manufacturing sites, and seven development and application centers.

Bosch Group in India employs over 31,000 associates and generated consolidated revenue of about ₨.18,300 crores (1.8 billion euros)* in 2016 of which ₨. 12,950 crores* from the third party. The Group in India has close to 18,500 research and development associates. In India, Bosch Limited is the flagship company of the Bosch Group. It earned revenue of over ₨. 10,500 crores in 2016.

Buy Back Offer Deal:

Buyback Type: Tender Offer
Buyback Record Date: Dec 21 2018
Buyback Opening Date: Feb 06 2019
Buyback Closing Date: Feb 20 2019
Buyback Offer Amount: ₹ 2159.010 Cr
Date of Board Meeting approving the proposal: Nov 05 2018
Date of Public Announcement: Nov 05 2018
Buyback Offer Size: 3.37%
Buyback Number of Shares: 1,028,100
FV: 10
Buyback Price: ₹ 21000 Per Equity Share

Details of Buyback:

The proposal to buyback not exceeding 1,028,100 (Ten Lakh Twenty Eight Thousand One Hundred Only) equity shares of face value of Rs. 10 of the Company (representing 3.37% of the total number of equity shares in the paid-up share capital of the Company) at a price of 21000 (Twenty One Thousand Rupees only) per equity share payable in cash for an aggregate consideration not exceeding 2159.010 Cr (Two Hundred Fifteen Crore only).

Salient financial parameters:

Year Revenue(Cr) PAT(Cr) EBITDA Margins Profit Margins EPS
FY16 10305 1531 24.0% 14.9% 488
FY17 11052 1741 23.0% 15.8% 561
FY18 12201 1370 21.0% 11.2% 450
1. The P/E of the stock based on FY18 EPS is 42. However, in the first 2 Qtrs of FY19, the company has clocked an EPS of 278. If we annualize it, then P/E based on FY19 earnings would be 34. 2. The Company is debt free.

How to Participate in buyback?

1. Firstly, to be eligible for the buyback the investor should have shares of Bosch Limited Buyback Offer 2018 in demat or physical form as on the record date 21.12.2018 ] 2. Once you have shares in demat, you can participate in the buyback process which is opening from [ 06.02.2019 to 20.02.2019 ] by selling your shares through your broker on NSE or BSE. 3. Then on [ 01.03.2019 ], 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 9 Shares at CMP of Rs.19500 [1,89,000/21000=9)
Acceptance Ratio 33% 50% 75% 100%
(i) Amount Invested in Buyback 1,89,000 1,89,000 1,89,000 1,89,000
(ii) No. of Shares buyback 3 4 6 9
(iii) BuyBack Profit 4,500 6,000 1,2000 1,3500
(iv) Profit(%) 2.38% 3.16% 6.33% 7.12%

Recommendation:

Review and Recommendation of Bosch Limited Buyback Offer 2018 by InvestorZone team is: 3/10 Fair: 1-5 Good:5-7 Excellent: 7-10 BOSCH Limited Buyback Offer 2016 detail

Company Contact Details:

Bosch Limited Hosur Road, Adugodi Bangalore-560030 Karnataka, India Phone No. +91 80 67528626 website:www.bosch.in

    [ Final Analysis of Bosch 2018 ( Return Analysis) ]

    1. Buyback Announcement date: 05.11.2018—– Share Price was 19500.

    2. 9 Shares bought at Rs. 19500 means an investment of 1,89,000.

    3. Retail Acceptance Ratio was 81.6%. i.e. out of 9 shares, 7 shares have been buyback by the company. Profit on Accepted Shares= 10,500.

    4. The 2 unaccepted Shares were given back on 01.03.2019. The Price on 01.03.2019 was 18750. So a loss of 1500 on selling these two shares.

    5. Overall we can say a profit of 8000 on an investment of 1,89,000 in 4 months.

    Category ———- Reserved ————– Tendered ——– Response (%)
    Retail —————-1,54,065 ————— 1,88,777 ———– 122.53%
    General ———— 8,73,035 ———- 2,26,53,398 ———-2,594.79%

    I had tendered shares…
    But it is not on demat at record date..

    So it was debited but not yet credited back..what to do?

      Last date of dispatch of share certificate(s) by the Registrar / ———————— March 01, 2019
      return of unaccepted demat Equity Shares by Stock Exchange
      to Eligible Shareholders

    Today Acceptance Ratio files will be available for download from BSE. ON monday payout of Funds and unaccepted Shares. 👍

    BOSCH
    I share accepted
    In Buyback tender..

    Enjoy🥳🥳🥳

    In Bosch individual category….. there is a large number of HNI More than 10 share.

    So 100% buyback possibility is also there.

    I got an email mentioning 0 shares entitlement for buyback despite having shares on the record date. Any idea why this can happen?

          Entitlement ratio
          Retail – 31 out of 75 —— 41.34%
          General – 15 out of 518 —– 2.90%

          Closing price on Record date – 19898.20
          19,898.20 * 31 = 6,16,844.20 (Above 2 lacs)

          Considered as General Category
          31 * 2.90% = 0.899 = 0 (Not rounded off while calculatig Entitlement)

          But still you can tender all 31 shares, chances of acceptance will depend on total shares tendered in General category.
          Probability of acceptance atleast 1 share is very high.

        4 Shares for 10 held is Entitlement ratio for small shareholders. Since you are shares valuing more than 2 Lakhs and above as pe Record Date closing price, you are in general category.

          In this case ( where company said our entitlement is 0 ), can we still go ahead & participate for buy back?

    Any News on Bosch?
    I dont think it require postal ballot or share holders approval?

    even i have 1 share….usually the company accepts the minimum number from every shareholder who tender’s so you can be sure that 1 share at-least will be bought back

    yes, Bosch done well.
    I bought average 19400, 9 nos.
    Sold 5 nos. today 19930 and would tender remaining in buyback @21000.
    Am sure acceptance ratio for retail should be more than 70-80%

    19/12/18 2DAY IS LAST DATE TO PURCHASE BOSCH , SKF SHARES TO BE ELIGIBLE FOR BUYBACK .

    20/12/18 IS LAST DATE FOR IOC BUYBACK.

    Pursuant to Regulation 42 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and in furtherance of our letter dated November 05, 2018, we wish to inform that the Buy Back Committee at its meeting held today i.e. December 10, 2018, inter-alia, approved Friday, December 21, 2018 as the record date for the purpose of determining the entitlement and the names of the Equity Shareholders who are eligible to participate in the Buyback Offer of the Company.

    Suggestion to Moderators of this platform.

    If possible incorporate your rating based on Price intervel

    For eg
    If price ranges 17000-18500 (x/10)
    If price ranges 18500-20000 (x/10)

    It can help investors a lot based on Price movement of Scrip

    What will be entitlement if someone has only one share of Bosch? 0 or 1?

      Entitlement will be 0 (as 7.32% entitlement ratio as per 30-09 holding & major change around 50% not expected till record date)
      He can tender 1 share in buyback, acceptance chances depending on total shares tendered by retailers

      I believe it is round to near 1
      Eg if Entitlement Ratio is less than 0.50, Entitlement qty shall be 0

      @ Market Wizard , As stock is also available in F&O, so what will be the derivative strategy if want to be safe and sold 1 lot 30 qty @ current market price?

        What will be the approx record date, as last time record date is 3 month after announce date?

    As per my suggestion acceptance ratio of bosch for retail investors is around 60%.
    If u have more demat account and you want to invest little money than buy only 1 share of bosch in all demat accounts.
    Your acceptance ratio will be 100%
    (1 out of 1)
    Buy at 18500 rs.
    Buyback at 21000 rs.
    Profit 2500 rs. At Investment of only 18500👍
    Assumption for small investors

      I think only one application per PAN number is allowed.If you tender shares in multiple demat accounts under one PAN number all applications will be rejected.

      What i veiw of experienced members?

        You are correct partially. If you tender via multiple demat accounts under one PAN, it will club all the shares in those Demat accounts and accordingly, if the value(no. of shares*Share price on Record date) of all the above shares are below 2 lakh then you will count under Retail Category else you will be counted under General Category.

    ICICI Direct has given a target of 20500. Please read below the report of the same.

    Revenues came in at Rs 3,201 crore (up 13.8% YoY), below our estimate of Rs 3,263 crore.
    Gross revenue from automotive segment grew 13.5% YoY to Rs 2,748 crore supported by Powertrain solutions & aftermarket division (grew 20.9% YoY) while revenue from the non-automotive segment grew 16.3% YoY to Rs 463 crore primarily supported by energy and power tool business division EBITDA margins came in at 18.6% (up 56 bps YoY) vs. our estimate of 19.1% mainly supported by lower other xpense & employee expense. Higher raw material cost (gross margin down 156 bps YoY, due to adverse currency movement & additional cost incurred on imports of injectors) partially impacted margins. Reported PAT increased 18.9% YoY to Rs 420 crore vs. our estimate of Rs 436 crore The Board has approved a buyback of up-to 1,028,100 equity shares, on a proportionate basis by way of a tender offer, at Rs 21,000 per equity share for an aggregate amount not exceeding ~Rs 2,159 crore (represents 3.37% of paid-up capital).

    Outlook

    With such uncertainty, we believe the company would be unable to enjoy premium multiple, as it commanded in the past. Thus, we maintain our HOLD rating on the stock, valuing it at 31x its FY20E EPS, with a target price of Rs 20,500/share.

      icici targets are generally not trustworthy, they rated redington very highly and target was around 131.
      i bought the shares and see what happened
      I burned my fingers in Mphasis as well

      ICICI highly recommended participating in their buyback and target price acc to them was 1500

    The buyback does not get any euphoria in terms of price appreciation. The reason could be:

    1. The Retail investors seldom buy such high-value share.
    2. The market may be accepting low AR.

    But my strategy in the buyback, that if a company is good and share is available at good valuation than buy it as an investment and later on tender your shares for buyback.

      Quarterly numbers shown by Dhanuka Agritech are good.

      Particulars ——–Q2FY19 ———Q2FY18——— %Change YoY
      Revenue(Cr)——– 385——– 349 ——– 10.1%
      Profit(Cr) —– 52——– 55 ——– 5.7%
      EBITDA(Cr) ——-79 ——– 77 ——– 2.52%

      The Company has also announced a Buyback at Rs. 550 ( an upside of 34%) for the maximum amount of 84 Cr subject to the approval of Shareholders. The maximum shares buyback would be 15 Lakh and out of which 2.25 lakh would be reserved for Retail Investors.

      Acceptance Ratio Calculations:

      1. Buy 363(200000/550) Shares at CMP of 410. The total investment would be 1,48,830.

      2. Total Number of Shareholder holding from 0 to 2500 Shares are close to 40 Lakhs. On that basis, the Acceptance ratio would be 5.625%. However, that is not correct, for exact calculation, we need no. of shareholders having shares between 0 to 363, which is not available anywhere. So Calculation of acceptance ratio is always on assumption basis.

      3. However, as we know the number of Retail shareholders who would be eligible for Buyback would be less than 40 lakh, so we can assume the buyback acceptance ratio to be roughly somewhere around 10-15% as of now.

    NHPC Ltd’s Q2FY19 standalone net profit rises 19.6% yoy to Rs1,219cr : In-line with Estimates
    The company’s standalone revenue stood at Rs2,495cr, up 26.6% yoy and 17.2% qoq

    Tomarow is board meeting of NHPC for buyback.
    CMP is 27.10.
    What will be buyback price any predictions?

    Which broker charges minimum and offers good services?
    If any one is having detailed information please share for the benefit of our friends.

      Do not expect better service as cheaper rate.

      I have switched over from HDFC to Religare to Sharekhan. I find Sharekhan most stable and most convenient and good platform out of all these. I get personalized RM whom you just call and he can take your orders, not a concern of calling 1800 number and remembering so many codes to dial (though these facilities are also available). U can put off-hours orders and their platform supports a lot of things for you to do online. After all, their brokerages is competitive for investors. If you are trader and having good volume, you can negotiate for better brokerages too. I am satisfied and not interested in switching to cheaper brokers..

    Please comment on tax calculations on the profit earned by tendering shares through buyback.

      Actually, there is two case in it.

      1. When the Company is buy backing the shares directly from shareholders.

      2. When the company is buy backing the shares from Stock Exchanges.

      We all mostly tendered shares under 2 category. So let us discuss it.

      1. Short-term capital gain (If the holding period is less than 12 months) – Capital gain is taxable at a flat rate of 15% under Section 111A as this transaction is chargeable to securities transaction tax (STT).

      2. Long-term capital gain (if the holding period is more than 12 months) – Capital gain exceeding Rs 1,00,000 shall be chargeable to tax at a flat rate of 10% under Section 112A as this transaction is chargeable to securities transaction tax (STT).

      Hope you got the point.

        Hi Market Wizard ,
        Is the exemption of 1 lac on long term capital tax per year is on each scrip or all combined gain .
        Thanks

          All combined bro. Whatever you gained in a year from equity markets.

          It’s 1 Lac long term aggregate profit per PAN number in a year. Does not matter how many scrips you have sold to earn that profit.

    Completely agree with you that hardly we see retails investors having such high-value share in their account. However, it is difficult to predict how many such investors are there who holds less than 10. The Annual Report also doesn’t mention less than 500 shares data.

    Last time also the buyback size was same close to 2000 Cr and very few retailers participated as during the announcement in August 2016 the price of a share in the market was above 23000( buyback price). Hence maybe few people got interested in it. However, this time the difference between CMP and Buyback Price is close to 8%, so more people may be interested to participate.

    Market Wizard Ji,
    I would beg to differ…
    Shares no. wise it may appear small buyback, but cost of 1 share is 21000/- , approx 100 times than the normal share..
    Size wise its 3.78% of total shares is a very good no. considering, high networth of company.
    Request to kindly deep dive for acceptance ratio… Any individual having LESS THAN 10 (TEN) shares would only qualify as retail, while currently 2 Lac category means people having even 1000 shares..
    The issue is that only 5-6% has been left on table by the company..
    But feel acceptance would be 100%…
    Normally retail investor doesn’t get into “SUCH COSTLY SHARE” with current cost nearly 20000

    *Acceptance Ratio will be low*
    New buyers should stay away.as only 1, 54, 000 shares for retailers against current holding of 21 lakh+ at September quarter end.

    At current holding it is only7.32%

        It was all Prima Facie. Will come up with more shortly.

        Sorry to jump in.
        2.1 million shares but holders of shares are 68K. Maximum for each share holder would be 9 shares which makes around 612000 shares only resulting in a entitlement of around 25%.

        However, if we take a more realistic approach, a lot of these 68000 shareholders will have more than 9 share in their accounts.
        Assuming only 50% shareholders will have share equal to or less than 9, retail category comes down to 306000 and entitlement improves to around 54%.

        But again, if you consider margin, it is very small as compared to other buybacks plus its a big size share so I don’t expect a huge response from public (even the announcement did not created much impact on the prices, volumes are less.). Therefore, expecting 80% of the people to get into the buyback which improves my acceptance further to around 70%.

        A lot of assumptions have been used, but I still feel those are realistic assumption.

        Thanks

      Reason is probably , that actual retail is one having less than 10 shares…
      people don’t like to hold such HIGH COST Share..

    Bosch held its conference call on 5 November 2018 to discuss its results and future.

    Highlights of the call

    In India, Bosch is a leading supplier of technology and services in the areas of Mobility Solutions,

    Industrial Technology, Consumer Goods, and Energy and Building Technology.

    It registered revenue of Rs 3201 crore in Q2, up 13.8%.

    PBT stood at Rs 641 crore, up 21.8%.

    Other income grew due to higher mark to market gains.

    Tractor segment grew 14%.

    Passenger car grew 4%.

    Profitability growth was on account of higher turnover, improved operational efficiency and higher productivity, which was partially offset by negative exchange rate on material cost.

    PAT stood at Rs 420 crore, up 19%.

    For the six months sales stood at Rs 6413 crore, up 17.5%.

    PBT stood at Rs 1290 crore and PAT stood at Rs 851 crore.

    Bosch Limited’s performance in the first two quarters highlights the company’s continued commitment to delivering best-in-class automotive solutions.

    The company is helping customers to meet the challenge of manufacturing vehicles compliant with BS VI emission standards from April 2020 as recently ruled by the Supreme Court.

    Outlook for FY 2019 remains optimistic.

    The management is glad by the jump in India’s ease of doing business.

    In the past quarter, Bosch has outperformed the industry in business beyond mobility sectors as well.

    As a recognized industry leader in many sectors, the company will continue to present innovations across its business including IoT services and integrated mobility offerings.

    Bosch Limited’s Mobility Solutions turnover increased 12.3% in Q2. The largest contributor were domestic automotive sales which have increased by 15.1%.

    Within the Mobility Solutions business, the Powertrain Solutions division performed especially well, registering double-digit growth of 10.3%.

    The Automotive Aftermarket division grew 20.9% after recovering from impact of GST implementation last year.

    Bosch’s business beyond the Mobility Solutions sector registered a strong growth of 14.3%. The main contributors were the Energy and Building Technology sector and the Power Tools division.

    For H1 sales of the Mobility Solutions sector increased 16.3% whereas business beyond the Mobility Solutions sector witnessed growth of 14.3%

    The Board also approved buyback of upto 1,028,100 equity shares of the company, on a proportionate basis by way of a tender offer at a price of Rs 21,000 per share for an aggregate amount not exceeding Rs 2159 crore.

    Growth in CV was aided by government focus on infrastructure and higher demand from Nepal and Bangladesh. It also grew on the back of new product launches.

    Bosch has, in India, the largest development center outside Germany, for end to end engineering and technology solutions

    Bosch in India employs over 31000 associates.

    The Bosch Group operates in India through thirteen companies.

    Last year the company got hit by GST.

    Bosch is the largest after market player in India. After market grew 21%. There is no reason why it won’t grow well in the future.

    It is a very small Buyback. So no point of participation for this specific purpose. However, as a long-term investor, this is a very good company for investment.