Cochin Shipyard Limited Buyback offer 2018
(i) Cochin Shipyard is the largest public sector shipyard in India in terms of dock capacity, according to CRISIL Report. The company caters to clients engaged in the defence sector in India and clients engaged in the commercial sector worldwide. In addition to shipbuilding and ship repair, it also offers marine engineering training. As of January 31, 2017, Cochin Shipyard has two docks – dock number one, primarily used for ship repair (“Ship Repair Dock”) and dock number two, primarily used for shipbuilding (“Shipbuilding Dock”). The Ship Repair Dock is one of the largest in India and enables it to accommodate vessels with a maximum capacity of 125,000 DWT (Dead Weight Tonnage). The Shipbuilding Dock can accommodate vessels with a maximum capacity of 110,000 DWT.
(ii) Cochin Shipyard is in the process of constructing a new dock, a ‘stepped’ dry dock (“Dry Dock”). This stepped dock will enable longer vessels to fill the length of the dock and wider, shorter vessels and rigs to be built or repaired at the wider part. The company is also in the process of setting up an International Ship Repair Facility (“ISRF”), which includes setting up a shiplift and transfer system.
(iii) In the last two decades, Cochin Shipyard has built and delivered vessels across broad classifications including bulk carriers, tankers, Platform Supply Vessels (“PSVs”), Anchor Handling Tug Supply vessels (“AHTSs”), barges, bollard pull tugs, passenger vessels and Fast Patrol Vessels (“FPVs”). The company is currently building India’s first Indigenous Aircraft Carrier (“IAC”) for the Indian Navy. It has also grown its ship repair operations and is the only commercial shipyard to have undertaken repair work of Indian Navy’s aircraft carriers, the INS Viraat and INS Vikramaditya.
Buy Back Offer Deal:
| Buyback Type: | Tender Offer |
| Buyback Record Date: | Oct 31 2018 |
| Buyback Opening Date: | Nov 28 2018 |
| Buyback Closing Date: | Dec 11 2018 |
| Buyback Offer Amount: | ₹ 200 Cr |
| Date of Board Meeting approving the proposal: | Oct 16 2018 |
| Date of Public Announcement: | Oct 16 2018 |
| Buyback Offer Size: | 6.41% |
| Buyback Number of Shares: | 43,95,610 |
| FV: | 10 |
| Buyback Price: | ₹ 455 Per Equity Share |
Details of Buyback:
How to Participate in buyback?
Profit from the buyback on the bases of acceptance Ratio:
| Acceptance Ratio | 33% | 50% | 75% | 100% |
| (i) Amount Invested in Buyback | 1,80,000 | 1,80,000 | 1,80,000 | 1,80,000 |
| (ii) No. of Shares buyback | 148 | 225 | 337 | 450 |
| (iii) BuyBack Profit | 8140 | 12375 | 18535 | 24750 |
| (iv) Profit(%) | 4.5% | 6.87% | 10.29% | 13.75% |
Recommendation:
Company Contact Details:
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Not bad: 35 % acceptance in Cochin Shipyard.
29 Lakh shares tendered for individuals against reservation of about 6 Lakh. Probable Acceptance could be 20%.
Cochin Shipyard Update:
1. The Entitlement Ratio for Retail is 7 out of 96, that means we are having close to 94 Lakh Retail investors as on Record date.
My estimate of Retail Investors when buyback was announced:( Missed Estimate by around 20 Lakhs ) on 17.10.2018
No. Of Shares= 43,95,610
Price= Rs. 455
Total Amount =200 Cr
A Retail investor can buy 440 Shares( 2lakh/455) to participate in the buyback.
As per Mar 18, the number of investors having shares between 1-500 are close to ~73 Lakh.
The No. of Shares reserved for Retail Investor in Cochin Buyback is close ~6.60 Lakh.
As per the above figure, the Acceptance Ratio would be less than 9%.
2. The Buyback will open on 28.11.2018 to 11.12.2018
Thanks for the update
if i am sel today 31-10-18 cochi ship yard share then i am eligible for buy back…bu
IS THERE ANY RULES ANY COMPANY SHOULD FINISH BUY BACK IN HOW MANY DAYS AFTER RECORD DATE?
Yes. Company needs to close Buyback after 6 Months of the Record Date. Last Year Wipro had the Window open almost 4 months after the Record Date.
No it is one year.
BHEL approves buyback of up to 189.3 mln shares at 86 rupees/shr.
5% of capital ; 20% premium to CMP
No need to pay any special attention to this company just because they have come up with a Buyback.
Kotak securities give target 520.is it right.pl tell me
Don’t believe in any such report these days.
The Cochin Shipyard is fundamentally a good company. However, we have a history of so many stocks not performing beacuse of PSU tag and this one is no exception. The share Is trading below its IPO price which speaks about the confidence of the market in this stock.
One Quick Solution that will work in Every Buyback.
The biggest problem in Buybacks is to find out Acceptance Ratio.
However, as a general check, we can always find the Rough Acceptance Ratio in any buyback.
Let us suppose the No. of Shares Reserved for Retail Investors are 10K and they can buy maximum 2000 Shares to be eligible under Retail for buyback.
Now to find out the Rough Acceptance Ratio we have to go to Shareholding Pattern of the latest quarter and have to figure out no. of shares up to 2 lakh Share Capital.
2 Lakh Share Capital means = No. of Shares*Face Value
No. of Shares= 2 Lakh/10= 20000[ Considering FV=10]
So what does that 20000 means????
It means there are “n” numbers of Investors who have for ex. 12, 49, 6660, 5555, 10000, 15000 etc shares in their account and whatever the number comes after adding all is suppose 100K.
So what we understood till now??
No. of Shares Reserved for Retail in buyback = 10K
No. of Shares Retail investor can buy to be elgibile= 2000
No. of Investors who are having shares up to 20000= 100K
Now, this 20k figure will cover almost all the retail investors who are eligible for buyback.
Acceptance Ratio would be =10K/100K= 10%.
Technically you are incorrect. In shareholding pattern the holders holding Rs 2lacs capital is nominal capital however for the purpose of buyback the retail share holder having Rs 2lacs capital means 2 Lacs value at market rate on record date.
It is a very good approximation. More so because most of the retailers are allottes of IPO .
Not much upside plus the size of the buyback is very small.
COCHIN SHIPYARD BUYBACK
No. Of Shares= 43,95,610
Price= Rs. 455
Total Amount =200 Cr
A Retail investor can buy 440 Shares( 2lakh/455) to participate in the buyback.
As per Mar 18, the number of investors having shares between 1-500 are close to ~73 Lakh.
The No. of Shares reserved for Retail Investor in Cochin Buyback is close ~6.60 Lakh.
As per the above figure, the Acceptance Ratio would be less than 9%
Entitlement ratio 7 out of 96.