Dhanuka Agritech Limited Buyback Offer 2018

Dhanuka Agritech Limited manufactures a wide range of agro-chemicals like herbicides, insecticides, fungicides, miticides, plant growth regulators in various forms – liquid, dust, powder, and granules.

The Company has a pan-India presence through its marketing offices in all major states in India, with a network of more than 7,000 distributors/ dealers selling to over 75,000 retailers across India and reaching out to more than 10 million farmers. The Company has technical tie-ups with 4 American, 5 Japanese & 2 European Companies.

Dhanuka’s target customers are primarily farmers. Growth drivers are the intensive marketing network penetrating even the interiors of India, increased farm income, enhanced awareness about the cost-benefit tradeoff of agro-chemicals, highly diverse product range with a solution for almost all problems in all crops, innovative marketing strategies, and international technical tie-ups. The Company keeps adding new products every year through its collaborations and is continuously on the lookout to bring the latest technology to Indian Farmers.

Buy Back Offer Deal:

Buyback Type: Tender Offer
Buyback Record Date: Jan 02 2019
Buyback Opening Date: Jan 25 2019
Buyback Closing Date: Feb 07 2019
Buyback Offer Amount: ₹ 82.50 Cr
Date of Board Meeting approving the proposal: Nov 14 2018
Date of Public Announcement: Nov 14 2018
Buyback Offer Size: 13.12%
Buyback Number of Shares: 1,500,000
FV: 2
Buyback Price: ₹ 550 Per Equity Share

Details of Buyback:

The Board of Directors of the Company Approved the proposal to Buyback of not exceeding 1,500,000 (Fifteen Lakh) Equity shares at a price of Rs. 550 (Five Hundred Fifty only) per equity share (the “Buyback Offer Price”) of face value Rs.10 each, payable in cash for an aggregate consideration not exceeding Rs. 82.50 crores.

How to Participate in buyback?

1. Firstly, to be eligible for the buyback the investor should have shares of Dhanuka Agritech Limited Buyback Offer 2018 in demat or physical form as on the record date [ 02.01.2019 ] 2. Once you have shares in demat, you can participate in the buyback process which is opening from [25.01.2019 to 07.02.2019] by selling your shares through your broker on NSE or BSE. 3. Then on [14.02.2019], 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 350 Shares at CMP of Rs.410 [1,43,500/410=350)
Acceptance Ratio 33% 50% 75% 100%
(i) Amount Invested in Buyback 1,43,500 1,43,500 1,43,500 1,43,500
(ii) No. of Shares buyback 115 175 262 350
(iii) BuyBack Profit 16,100 24,500 36,680 49,000
(iv) Profit(%) 11.21% 17.07% 25.56% 34.16%

Recommendation:

Review and Recommendation of Dhanuka Agritech Limited Buyback Offer 2018 by InvestorZone team is: 2/10 Fair: 1-5 Good:5-7 Excellent: 7-10 IZ Review 1. The Potential upside of 34% from CMP. 2.  The company share is available at a good valuation. P/E of 16 on FY17-18 Numbers. The Company has shown a good set of numbers in Q2FY19. 3. The Acceptance ratio would be very low somewhere around 10-15%. So take decision accordingly.

Company Contact Details:

Dhanuka Agritech Limited 14th Floor, Building 5A, DLF Cyber Terrace, Cyber City, DLF Phase III Gurgaon- 122002, Haryana, India. Phone: +91-124-3838500 Email: headoffice@dhanuka.com

    Tendered shares in individual category is 972709 as on 7th Feb 2019 6.30PM.
    AR is around 23.13% minimum as per numbers (225000/972709).

    Tendered shares in individual category is 632421.
    AR is around 35.5% as per numbers.

    As off 01st Feb 2019 by 7.30PM, Bidding Subscription details:-
    Reserved for Retail Category: 2,25,000
    Tendered in Individual Category : 4,37,592 (All Individuals Category)
    Acceptance Ratio : 51.42% nearly Minimum.

    Letter of Offer for Dhanuka Agritech
    https://www.bseindia.com/xml-data/corpfiling/AttachLive/3532208d-085e-4ab2-9793-06b9493f9490.pdf

    Entitlement:

    Reserved Category for Small Shareholders = 7 Equity Shares for every 67 Equity Shares held on the Record Date i.e. 02-01-2019

    General Category for other Shareholders = 5 Equity Shares for every 184 Equity Shares held on the Record date i.e. 02-01-2019

    Date

    Dhanuka is buyback hugely popular. 27,635 as of 31st Dec and now 53,640 Small Shareholders in the Letter of Offer.

    BUY-BACK OPENS ON – FRIDAY, JANUARY 25, 2019

    BUY-BACK CLOSES ON – THURSDAY, FEBRUARY 07, 2019

    LAST DATE/TIME OF RECEIPT OF COMPLETED APPLICATIONS, FORMS AND OTHER SPECIFIED DOCUMENTS INCLUDING PHYSICAL SHARE CERTIFICATES BY THE REGISTRAR TO BUY-BACK: SATURDAY, FEBRUARY 09, 2019 BY 5.00 P.M.

    Hi market wizard,
    I bought shares of Dhanuka on 28th December, 29th and 30th were holidays, 1st is the exdate, am I eligible for the buyback considering that it takes T+2 days for stock to get into demat?

    Hi market wizard, please let me know should I buy it today for buyback??
    Current price is around 470 rs…
    Any idea about acceptance ratio?

    Board meeting is scheduled for December 20 to consider the final buy-back price, fixation of the record date and other related matters in respect of the proposed buy-back of equity shares of the company.

    Tata Investment Corp. a TATA Enterprise is going for 45L equity shares buyback @ Rs. 1000/- each. Announcement made yesterday.

      Just wait for the record date to announce. It might be available below 400 as a market condition is choppy which would be a good entry price considering low Acceptance Ratio. We need to understand that the condition of the economy is not sound. The way Govt is coming up with so many buybacks, OFS, asking Special Dividends from Power PSUs, intervening RBI to put liquidity in the system shows all is not good. So better wait and buy at the right price. Had we in 2017 I would have blindly said to buy at CMP but not anymore. Hope u understand.

    Mene mera profit book kar liya h
    MENE 387 per 815 SHARE buy kiye . &. 436 PER SELL aaj sare sell kar diye my profit is =39000

    As on 30 Sep
    Retail investors (holding below 2 lacs) — 40,29,423
    Buyback shares reserved for retailers — 2,25,000

    Entitlement ratio (as per 30 sep holding) — 5.65% Approx.
    Buyback gain from CMP – 34.5%

    ** Actual Entitlement ratio & Acceptance ratio will be different as per record date & shares tendered by retailers

    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.

      Individual Shareholders holding nominal share capital upto r,s 2 Lakhs is around 40 lakhs
      Does that mean that all of them will come under retail category?

        And sorry to say but i disagree with the approximation of acceptance ratio
        according to me acceptance ratio should be around 40%+

        in jan 2017 dhanuka had a buyback of 17% size and at that time shareholders with nominal share capital below 2 lakhs were around 36 lakhs
        yet the final acceptance ratio was 57%

        This time shareholders below 2 lakh are 40 lakh and buyback size is around 14&
        so acceptance should be atleast 40%

        please correct me if I am wrong
        thanks

        No. This figure shows the list of shareholders who hold share between 0 to 1 lakh( 2lakh/2(fv)).

        But in the case of Dhanuka Agritech, the Retail investors would be who hold share between 0 to 350.