Cheviot Company Ltd Buyback 2021

(i) Group Cheviot consists of a diversified portfolio of industries in Jute, Tea and Leather. Over 5,000 employees are working in various disciplines for the Group. These include highly qualified, experienced and professional managers, technicians, administrators, and skilled & unskilled workers.

(ii) They operate two business segments namely Jute goods and Captive power generation. Their jute products include sacking bags sacking cloth hessian cloth and bags and decorative fabrics.

(iii) In January 2003 company commenced commercial operation in their Captive Power Plant with the installed capacity of 3.14 MW. In March 2003 the company commenced commercial production of industrial fabrics at their new 100% Export Oriented Unit (EOU) in Falta Special Economic Zone (FSEZ).

Buy Back Offer Deal:

Buyback Type: Tender Offer
Buyback Record Date: Dec 17 2021
Buyback Opening Date: Jan 10 2022
Buyback Closing Date: Jan 21 2022
Buyback Offer Amount: ₹ 43.12 Crores
Date of Board Meeting approving the proposal: Dec 04 2021
Date of Public Announcement: Dec 04 2021
Buyback Offer Size: 3.99%
Buyback Number of Shares: 2,50,000
Price Type: Tender Offer
FV: 10
Buyback Price: ₹ 1725 Per Equity Share

Details of Buyback:

The Board of Directors of Cheviot Company Ltd at their meeting held on Saturday, 4th December, 2021 have approved a proposal for Buy-Back of up to 2,50,000 fully paid-up Ordinary Shares of the Company of face value of Rs. 10/- (Rupees Ten Only) each, representing 3.99% of the present total number of fully paid-up Ordinary Share Capital of the Company, at a price of Rs. 1,725/- (Rupees One Thousand Seven Hundred and Twenty-Five Only) per Ordinary Share ('Buy-Back Price') payable in cash for an aggregate amount of up to Rs. 43,12,50,000/- (Rupees Forty-Three Crores Twelve Lakhs and Fifty Thousand Only) representing 8.61% of the aggregate paid-up capital and free reserves as per latest standalone audited financial statements of the Company for the financial year ended 31st March, 2021 ('Buy-Back Offer Size').

Salient financial parameters:

Particulars (in Crores) Mar 21 Mar 20
Revenue 396 458
Expense 343 401
Operating profit 52 57
OPM % 13% 12%
Other Income 46 9
Depreciation 4 4
Profit Before tax 93 62
Profit After Tax 76 48
EPS 120.83 65%
 

How to Participate in buyback?

1. Firstly to be eligible for the buyback the investor should have shares of Cheviot Company Ltd Buyback 2021 in Demat or physical form as on record date [ 17.12.2021 ]. 2. Once you have shares in demat, you can participate in the buyback process which is opening from [10.01.2022 to 21.01.2022 ].by selling your shares through your broker on NSE or BSE. 3. Then on [ Not available ], 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 115 Shares at CMP of Rs. 1450 (2,00,000/1725=115)
Acceptance Ratio 33% 50% 75% 100%
Amount Invested in Buyback 1,66,750 1,66,750 1,66,750 1,66,750
No. of Shares buyback 38 58 86 115
BuyBack Profit 10,450 15,950 23,650 31,625
Profit 6.26% 9.56% 14.1%% 19%
 

Recommendation:

Review and Recommendation of Cheviot Company Ltd Buyback 2021 by IZ team is: 4/10 The buyback size is just 43 Crores. However, arbitrage of ~19% is available between current market price and buyback price. [ER = 3%]

Company Contact Details:

Cheviot Company Limited CIN: L65993WB1897PLC001409 Magma House (9th Floor) 24, Pak Street, Kolkata – 700016 Office Line: 82320 87911 / 12 / 13 Fax: +91-33-22497269 / 22172488 Website: www.groupcheviot.net

21 Comments

      Retail ER – 15%, As per calculation potential retailers is around 23Lacs, Looks like Max 30% AR

      After deduction of promoters number General Category comes around 67 Lacs, So bare minimum 30% will go in buyback if all general category participate else looks like 40% AR.

      Reply

        Sir,
        I believe that the AR in general category is likely to be not less than 50% as the promoters may not participate in the buyback. Thank you.

        Reply

          Anurag ji,
          In my opinion, anything more than 40% AR is good as chances to this extent are likely to be on a lower level. Thank you for sharing your views.

          Reply

            Ramakrishna sir,
            Maine apne Gurudev Aniketiaf sir se ER/AR calculation sekha tha. In dino sir ji kisi v forum par active nahi hain. Pehli baar un k diye hue Gyan k aadhar par AR calculation kiya hun. Dekhna hai k kitna sahi sabit hota hai.

            Reply

              ANURAG JI,

              From the bottom of my heart, I am telling you that I miss my true Guru ANIKET Ji like anything. You might have seen many of my humble prayers regarding the loss we are experiencing due to non availability of his valuable views. But, unfortunately he could not respond. Hopefully looking forward for his resumption of posting helpful messages.
              I am also in the process of learning. Thank you for the warmth in your post.

              Reply

      Sir,
      GE Shipping may decide on 27/12, the details of the buyback of the shares of the company. Let us wait and see.

      Reply

        Sumit ji,
        If you can kindly share your experience of the previous occasion n views on the present one, I shall be grateful to you.

        Reply

    Sep 2020 buyback had 20% acceptance for small shareholders…
    I Expect 25%.. Seems to be risky.

    Anyone kindly comment.

    Reply

    very small size 4%.. ER of 3% 🙁

    EPS is good. No benefit and high risk if bought at more than 1350 – 1400..

    Reply

    I wholeheartedly appreciate your consideration for opening up of a separate page for the buyback of Cheviot.
    Around Rs.1400/- maybe the best choice to grab the opportunity. Let us wait and see if we can get the shares at that rate. Thank you.

    Reply

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