Motilal Oswal Financial Services Limited Buyback 2020

(i) Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.

(ii) Motilal Oswal Securities Ltd.* is a group company of Motilal Oswal Financial Service Limited which started as a stock broking company and has blossomed into a well-diversified firm offering a range of financial products and services.

They have a diversified client base that includes retail customers (including High Net worth Individuals), mutual funds, foreign institutional investors, financial institutions and corporate clients. The company has awarded ‘Best Performing National Financial Advisor – Equity Broker’ for four years in a row at the UTI-CNBC TV18 Financial Advisor Awards.

(iii) As a retail broking customer, you can trade in Equity, Derivatives, Commodities, Currencies, Mutual Funds, IPOs, Bonds, and Insurance through them.

Buy Back Offer Deal:

Buyback Type: Open Market
Buyback Opening Date: Apr 01 2020
Buyback Closing Date: Sep 30 2020
Buyback Offer Amount: ₹ 150 cr
Date of Board Meeting approving the proposal: Mar 21 2020
Date of Public Announcement: Mar 21 2020
Buyback Offer Size: 7.51%
Price Type: Open Market
FV: 1
Buyback Price: ₹ 650 Per Equity Share

Details of Buyback:

MOTILAL OSWAL FINANCIAL SERVICES LTD.has informed BSE that in the meeting of the Board of Directors of the Company held on 21.03.2020, has approved a buyback of shares worth Rs. 150 Cr from Open Market at a price not exceeding Rs. 650 per share.

Salient financial parameters:

Particulars( in Cr) Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19
Sales + 467 772 1,080 1,923 2,751 2,463
Expenses + 326 516 647 915 1,357 1,543
Operating Profit 140 256 432 1,008 1,394 920
OPM % 30% 33% 40% 52% 51% 37%
Interest 3 31 174 442 528 517
Depreciation 24 31 35 33 37 24
Profit before tax 59 196 225 506 829 384
Tax % 30% 27% 27% 28% 25% 24%
Net Profit 40 144 169 360 622 294
EPS in Rs 2.52 9.67 11.38 24.41 42.89 20.18
Source: Screener.in

How to Participate in buyback?

In this method of share Buyback, the company will be purchasing stocks from existing shareholders of the company directly from the market. Example: “Motilal Oswal Financial Services Limited Buyback 2020” announces the buyback plan of its shares up to the price of Rs 650, it means that the company will be purchasing shares of "Motilal Oswal Financial Services Limited Buyback 2020" from the open market at a price not exceeding Rs.650 per share. Scenario 1- If the share price is below Rs. 650 in that case, the company will put buy orders at the current market price and purchase shares. Scenario 2- If the share price is above Rs. 650, in that case, the company will put buy order at Rs. 650 only and if someone is ready to sell at Rs.650 or less then the only company will get back shares.

Profit from the buyback on the bases of acceptance Ratio:

NA as it is open market buyback.

Recommendation:

It is an open market buyback.