KG Denim Limited Buyback offer 2018

KG Denim Limited, a premier denim and apparel fabric manufacturer, catering to leading fashion brands and retailers worldwide. During the decades of journey, they have remained committed to a simple mantra – They believe in enabling fashion. A mere look at their journey so far bears testimony to this fact. They diverse and value integrated approach has seen to go from strength to strength. From being the reigning kings of denim, today, They are poised on the threshold of success in the home textile arena. The journey ahead seems as exciting.

Buy Back Offer Deal:

Buyback Type: Tender Offer
Buyback Record Date: Nov 30 2018
Buyback Opening Date: Jan 22 2019
Buyback Closing Date: Feb 04 2019
Buyback Offer Amount: ₹ 10 Cr
Date of Board Meeting approving the proposal: Nov 14 2018
Date of Public Announcement: Nov 14 2018
Buyback Offer Size: 9.75%
Buyback Number of Shares: 2,500,000
FV: 10
Buyback Price: ₹ 40 Per Equity Share

Details of Buyback:

The Board of Directors of the Company Approved the proposal to Buyback of not exceeding 25,00,000 (Twenty Five Lakhs only) Equity shares at a price of Rs. 40/- (Rupees Fourty only) per equity share (the “Buyback Offer Price”) of face value Rs.10 each, payable in cash for an aggregate consideration not exceeding Rs. 25 crores.

How to Participate in buyback?

1. Firstly, to be eligible for the buyback the investor should have shares of KG Denim Limited Buyback offer 2018 in demat or physical form as on the record date [30.11.2018] 2. Once you have shares in demat, you can participate in the buyback process which is opening from [22.01.2019 to 04.02.2019 by selling your shares through your broker on NSE or BSE. 3. Then on [13.02.2019], 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 5,000 Shares at CMP of Rs.40 [2,00,000/40=5,000)
Acceptance Ratio 33% 50% 75% 100%
(i) Amount Invested in Buyback 2,00,000 2,00,000 2,00,000 2,00,000
(ii) No. of Shares buyback 1650 2500 3750 5,000
(iii) BuyBack Profit 00 00 00 00
(iv) Profit(%) 00% 00% 00% 00%

Recommendation:

Review and Recommendation of KG Denim Limited Buyback offer 2018 by InvestorZone team is: 5/10 Fair: 1-5 Good:5-7 Excellent: 7-10

Company Contact Details:

KG Denim Limited Then Thirumalai, Coimbatore – 641302, India. Phone No.+91 4254 235401 website: www.kgdenim.com

6 Comments

    [Final Analysis of K G Denim 2018 ( Return Analysis)]

    1. Buyback Announcement date: 14.11.2018—– Share Price was 36.

    2. 5000 Shares bought at Rs. 36 means an investment of 1,80,000.

    3. Retail Acceptance Ratio was 100%. i.e. out of 5000 shares, 5000 shares have been buyback by the company. Profit on Accepted Shares= 20,000

    4. Overall we can say a profit of 20,000 an investment of 1,80,000 in less than 3 months.

    Reply

    Entitlement of 421 shares for every 2036 Shares.
    Entitlement= 20%

    Reply

    Avoid this company. No upside from CMP as far as buyback is concerned. Poor OPM and NPM. The EPS of 2018 is 0.95 , on that basis, the current P/E is 42. The company has poor Interest coverage ratio. The textile sector is laggard in giving returns to investors.

    Reply

    *Kg Denim Ltd* – The *proposal to buyback* upto 25,00,000 (Twenty Five Lakhs only) fully paid-up equity shares of Rs. 10/- each of the Company (representing 9.75% of the total number of equity shares in the paid-up share capital of the Company) at a price of Rs. 40/- (Rupees Fourty only) per equity share payable in cash for an aggregate consideration not exceeding Rs. 10.00 Crores (Rupees Ten Crore only), representing 9.26% of the paid- up share capital and free reserves as per the audited standalone financial statements of the Company for the financial year ended March 31, 2018

    Reply

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