India Bulls Real Estate Buyback 2019

(i) Indiabulls Real Estate was incorporated in the year 2005 with the focus on construction and development of residential, commercial & SEZ projects across major Indian Metros & London. It is the 3rd largest real estate company in India by net worth and assets, with a total Gross Development Value of ₹349.6 billion (US$5.4 billion) and net worth of ₹72.18 billion (US$1.1 billion), as of June 30, 2015.

(ii) Indiabulls Real Estate has a presence in key Indian metros—Mumbai, Delhi and Chennai. Currently, it has 10 ongoing projects in India with a total saleable area of 30.14m sqft, and 5 new projects are planned to be launched shortly with a total saleable area of 7.87 m sqft. Additionally, the company has a fully paid for a land bank of 1,017 acres & also possesses 2,588 acres of SEZ land at Nashik, Maharashtra.

(iii) Indiabulls Real Estate has delivered two commercial towers in Mumbai—One Indiabulls Centre & Indiabulls Financial Centre with over 3m sqft space, apart from delivering projects in Madurai, Ahmedabad, and Thane. Recently, Indiabulls Real estate acquired the prime property, 22 Hanover Square in central London for ₹16.3 billion (US$250 million).

Buy Back Offer Deal:

Buyback Type: Tender Offer
Buyback Offer Amount: ₹ 500 Cr
Date of Board Meeting approving the proposal: Oct 11 2019
Date of Public Announcement: Oct 11 2019
Buyback Offer Size: 11%
Buyback Number of Shares: 50000000
Price Type: Tender Offer
FV: 2
Buyback Price: ₹ 100 Per Equity Share

Details of Buyback:

The Board of Directors of Indiabulls Ventures Limited (the “Company”) at its meeting held on October 11, 2019, has approved a proposal of Rs. 500 Crores of buyback of up to 5,00,00,000 Fully Paid-up Equity Shares having Face Value Rs. 2/- each of the Company, representing 11% of it's total existing fully paid-up equity capital (“Equity Shares”) at Rs. 100/- per Equity Share through the “Tender Offer” route.

Salient financial parameters:

Particulars(cr) 2018-19 2017-18 2016-17 2015-16 2014-2015
Revenue 117.07 82.36 27.2 17.38 35.5
Other Income 437.65 300.86 398.33 377.95 283.19
Total Income 554.72 383.21 425.53 395.33 318.69
Expenditure -403.85 -398.4 -407.27 -36.43 -31.25
Net Profit 106.01 -19.75 17.35 55.16 23.06
Equity 90.14 94.94 -- 92.34 85
EPS 2.32 -0.42 -- 1.23 0.54
OPM % 128.86 -18.44 67.11 2065.01 809.71
NPM % 90.55 -23.99 63.79 317.38 64.95

How to Participate in buyback?

1. Firstly to be eligible for the buyback the investor should have shares of IBull Real Estate Limited Buyback 2019 in demat or physical form as on record date on [ Not Announced ] 2. Once you have shares in demat, you can participate in the buyback process which is opening from [ Not Announced ] by selling your shares through your broker on NSE or BSE. 3. Then on [ Not Announced ], 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 2000 Shares at CMP of Rs.43 ( 2,00,000/100=2000)
Acceptance Ratio 33% 50% 75% 100%
Amount Invested in Buyback 86,000 86,000 86,000 86,000
No. of Shares buyback 660 1000 1500 2000
BuyBack Profit 37,620 57,000 85,500 1,14,000
Profit 43.74% 66.28% 99.42% 132.56%

Recommendation:

Review and Recommendation of IBull Real Estate Limited Buyback 2019 from IZ team is:  2/10 Fair: 1-5 Good: 5-7 Excellent: 7-10

2 Comments

    In the last 3 months the share has fallen from 144 to 43. This shows investors do not have confidence in the stock.

    The current market price is 43 and buyback price is 100. There is more than 100% arbitarage. However, i feel it is very risky to enter in India Bulls group buybacks.

    The risky investors can take bet.

    Reply

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