Sarda Energy & Minerals Buyback 2022

i. Sarda Energy & Minerals Limited (SEML), incorporated in 1973, is the flagship company of Sarda Group.Listed on BSE and NSE with Promoters’ holding 72.50%,Vertically integrated producer of steel with captive iron ore.Manufacturer and exporter of niche grade manganese based ferro alloys.Self sufficient captive power from Waste heat & coal.Interests in Hydro power projects through SPVs. A TWO STAR EXPORT HOUSE, recognized by the Ministry of Commerce & Industry, Govt. of India.
SEML is one of the lowest cost producers of steel (Sponge Iron, Billets, Ferro Alloys,Mining,Power,Pellets,Iron Ore,Wire Rod Mill, Eco Bricks) and one of the largest manufacturers and exporters of ferro alloys in India. Headquartered in Raipur, Chhattisgarh, the company merged Chhattisgarh Electricity Company Limited (CECL) with itself in 2007 with a vision to becoming a leading energy and minerals company.

ii. Over the last three decades the company has continuously diversified its product portfolio to include many customized value added products. The company firmly believes in benchmark product quality, customer centric approach, people focus, ethical business practices and good corporate citizenship. Building on these values, SEML has become the supplier of choice for many domestic and international customers across more than 60 countries.

iii. SEML differentiates itself from its peers by not being just another steel company. It foresaw the importance and emergence of energy and minerals as two critical ingredients for developing economies and particularly for India. Synergy in Energy became the basis of all its future endeavors. Today, SEML is one of the very few companies to become completely self-sufficient in terms of its energy requirements and is well on its way to achieve self sufficiency in other mineral resources. The company has acquired iron ore and manganese mines in India and is aggressively looking for mineral resources across the globe.

iv. SEML is listed on Bombay Stock Exchange (504614) and on National Stock Exchange of India Limited (SARDAEN).

Buy Back Offer Deal:

Buyback Type: Tender Offer
Buyback Record Date: May 06 2022
Buyback Opening Date: Jun 02 2022
Buyback Closing Date: Jun 15 2022
Buyback Offer Amount: ₹ 121.67
Date of Board Meeting approving the proposal: Apr 23 2022
Date of Public Announcement: Apr 23 2022
Buyback Offer Size: 6.06%
Buyback Number of Shares: 8,11,108
Price Type: Tender Offer
FV: 10
Buyback Price: ₹ 1500 Per Equity Share

Details of Buyback:

The Board of Directors of the Company at its meeting held on 23 April 2022 has approved the Buy-back of upto 8,11,108 (eight lakh eleven thousand one hundred and eight) Equity Shares of face value of Rs.10/- each at a price of 1,500/- per Equity Share aggregating to an amount not exceeding Rs. 121.67 crores (Rupees one hundred twenty-one crore and sixty-seven lakh).

Salient financial parameters:

Source: Screener.in
Particulars( in Crores) Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-21
Sales 1,760 1,480 1,434 2,174 2,324 2,000 2,199
Expenses 1,383 1,295 1,217 1,772 1,842 1,644 1,679
Operating Profit 377 185 217 402 482 356 520
OPM % 21% 12% 15% 18% 21% 18% 24%
Other Income -77 41 96 63 17 -17 130
Interest 120 112 94 97 99 82 79
Depreciation 93 75 69 73 76 78 75
Profit before tax 87 39 150 294 324 179 495
Tax % 35% 68% 15% 30% 36% 24% 23%
Net Profit 55 13 132 202 203 126 375
EPS in Rs 15.27 3.50 36.60 56.17 56.36 35.05 103.99

How to Participate in buyback?

1. Firstly to be eligible for the buyback the investor should have shares of Sarda Energy & Minerals Buyback Offer 2020 in demat or physical form as on record date [06.05.2022 ]. 2. Once you have shares in demat, you can participate in the buyback process which is opening from [ 02.06.2022 to 15.06.2022 ] by selling your shares through your broker on NSE or BSE. 3. Then on [27.06.2022], 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 133 Shares at CMP of Rs. 1250 [2,00,000/1500=133)
Acceptance Ratio 33% 50% 75% 100%
Amount Invested in Buyback 166666 166666 166666 166666
No. of Shares buyback 43 66 99 133
BuyBack Profit 10,750 16,500 24,750 33,250
Profit 6.45% 9.90% 14.85% 19.95%

Recommendation:

Review and Recommendation of Sarda Buyback 2022 from our IZ team is: 4/10 1-5: Fair 5-7: Good 7-10: Excellent.

19 Comments

    I wish to know the AR in respect of Retail Category in Sarada Energy & Minerals. I shall be grateful if someone helps me in this regard. Thank you very much in advance.

    Sir
    Can we check whether shares are tender under by back or not
    And if yes then how
    Thanks in advance

      It will get block for buyback. You will get sms.
      If you will try to sell it then same message you will get as failure reason

    For Filatex
    10.18% Entitlement ratio. Expecting AR to be 45-65%

    Hello experts,
    What is the expected ER & AR in retail for this buyback?

    Please give your valuable suggestions

      The public shareholding (nominal value 2 lakhs) is 13.05 %. So, the entitlement ratio is likely to be about 6.5% – 9%.
      The share price was below 800 till Feb 22. In Feb, it went to 943, possibly due to price increase in commodities. Then dipped to 765.
      Thereafter, the price started rising in March and crossed 1000 for the first time in March – Possibly, insider trading due to the buyback. Now it is at about 1200.
      To me, given the market conditions, it appears very risky.

      India mart Buyback Particulars:

      Buyback size: upto 01,60,000 shares
      Buyback price : Rs. 6250/-
      Buyback amount: Rs.100 Crores
      Mode : Through Tender Offer
      Record date : May 11, 2022
      CMP: Around Rs.4915/-

      Happy investing to all of you. Thank you.

            Sumit ji,
            Have you purchased any shares of Gail, Sarada energy, Indiamart for the buyback purpose? Do you mind to share?

    New buyback is Sinclair’s hotel’s @143 but price already increased 20 % in week .experts pl advise.

      22% equity is with small share holders… AR can be very very small… I would avoid..

    Buyback offer size is 2.55% and total approx 10% retail investor.
    Should go for it?
    Experts, Kindly suggest

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