Dhanuka Agritech Limited Buyback Offer 2022

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: Nov 18 2022
Buyback Opening Date: Dec 26 2022
Buyback Closing Date: Jan 06 2023
Buyback Offer Amount: ₹ 85 Cr
Date of Board Meeting approving the proposal: Nov 01 2022
Date of Public Announcement: Nov 01 2022
Buyback Offer Size: 2.15%
Buyback Number of Shares: 10,00,000
Price Type: Tender Offer
FV: 2
Buyback Price: ₹ 850 Per Equity Share
Letter for Offer Link

Details of Buyback:

The Board of Directors of Dhanuka Agritech Limited Buyback 2022 at its meeting has approved the proposal for buyback of fully paid up equity shares of the Company having a face value of INR 2/- (“Equity Shares” and such buyback “Buyback”) from all shareholders/ beneficial owners of the Equity Shares of the Company, as on record date of 18.11.2022, through the “Tender Offer” route, at a price of INR 850/- for an aggregate amount not exceeding INR 85 Cr/.

Salient financial parameters:

Particulars(in crores) Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022
Sales 963 1,006 1,120 1,387 1,478
Expenses 796 860 947 1,118 1,214
Operating Profit 166 146 174 269 264
OPM % 17% 15% 15% 19% 18%
Other Income 16 21 25 34 34
Interest 1 1 2 3 3
Depreciation 14 12 16 15 16
Profit before tax 167 154 181 285 278
Tax % 24% 27% 22% 26% 25%
Net Profit 126 113 141 211 209
EPS in Rs 25.71 23.66 29.71 45.21 44.85
Dividend Payout % 21% 3% 40% 4% 31%

How to Participate in buyback?

1. Firstly, to be eligible for the buyback the investor should have shares of Dhanuka Agritech Limited Buyback 2022 in demat or physical form as on record date on [ 18.11.2022 ] 2. Once you have shares in demat, you can participate in the buyback process which is opening from [ 26.12.2022 to 06.01.2023 ] by selling your shares through your broker on NSE or BSE. 3. Then on [ 17.01.2023 ], the settlement will be done for accepted shares and unaccepted shares will be returned to your demat account.  

Profit from the buyback on the bases of acceptance Ratio:

Buy 235 Shares at CMP of Rs.732 [2,00,000/850)
Acceptance Ratio 33% 50% 75% 100%
(i) Amount Invested in Buyback 1,72,020 1,72,020 1,72,020 1,72,020
(ii) No. of Shares buyback 76 118 183 235
(iii) BuyBack Profit 8,968 13,924 21,594 27,730
(iv) Profit(%) 5.21% 8.09% 12.55% 16.10%
 

Recommendation:

Review and Recommendation of  Dhanuka Agritech Limited Buyback Offer 2022 from IZ team is: 5/10 [Good arbitrage of 16% is available in the buyback. The growth in the financials for FY22-23 is also good. However, the size of buyback is small. ]

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

19 Comments

    Dhanuka, very fast, Letter of offer submitted. Hopefully would get very good AR.

    Reply

        Sumit ji,

        I have purchased only 153 shares in all for the two accounts due to the financial constraints. I am also positive on this buyback. All the best to you.

        Reply

    Please excuse. Last Buyback was in 2020, where AR was very low. But company has moved much from there.. Hopefully 2022 would be profitable.
    Record date is not far..

    Reply

    Checked in detail, comparison from 2018-19..
    Dhanuka very well poised.. Equity with Govt of Singapore, LIC and other good Mutual funds now.. Retail %age was 8.5% in 2018 December, which is now reduced to 6.63% (on reduced equity).
    Appears to be good Buyback after long time, bough 150 @ 731 today..
    Only worrying point is if markets sustains or crash..
    Thanks

    Reply

      Sumit ji,

      Thank you very much for sharing your precious views. Please keep posting your valuable suggestions on each buyback of the Tender Offers. Very kind of you.

      Reply

    Seems to be a good arbitration of 15-16%. Excellent results QOQ & YOY, so may reach 800..
    Last (2018-19) Buyback has acceptance of 75% for retail,,,
    Hopefully would be same..

    Reply

    Buyback thru Tender route with target of 10,00,000 Shares at the buyback price of Rs 850/-

    Reply

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