Savita Oil Technologies Buyback 2021

Mr. Nandkishore Mehra, along with his father Mr. Devichand Mehra founded Savita in 1961. They have setup Savita’s first manufacturing unit at Sakinaka, Mumbai in 1961 to manufacture liquid paraffin as an import substitute. This was soon followed by the production of petroleum jelly in 1965. Then a year later, Savita built its second manufacturing unit at Turbhe, on the out-skirts of Mumbai for the manufacture of petroleum specialties.

IN 1976, Savita’s Research and Development Department was setup to be the first of its kind in the private sector oil industry in India to be recognized by the Government of India’s Department of Science and Technology.

Portfolio of the company:

1. Transformer Oil.
2. White Oil and Liquid paraffin.
3. Lubricating Oil
4. Petroleum jellies
5. Oxidises Waxes and Wax emulsions

Buy Back Offer Deal:

Buyback Type: Tender Offer
Buyback Record Date: Mar 05 2021
Buyback Offer Amount: ₹ 35 Crores
Date of Board Meeting approving the proposal: Feb 19 2021
Date of Public Announcement: Feb 19 2021
Buyback Offer Size: 1.78%
Buyback Number of Shares: 2,51,000
Price Type: Tender Offer
FV: 10
Buyback Price: ₹ 1400 Per Equity Share

Details of Buyback:

Approved the proposal to buy-back up to 2,51,000 Equity Shares of Re.10/- each of the Company for an aggregate amount not exceeding Rs.35 Crores (hereinafter referred to as the "Buyback Size") being 1.78% of the total paid-up equity share capital, at Rs. 1400/- per Equity Share (hereinafter referred to as the "Buyback Price") via tender route.

Salient financial parameters:

Particulars (in Cr) Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20
Sales 2,066 1,835 1,484 1,496 1,782 2,261 2,044
Expenses 1,913 1,773 1,395 1,341 1,595 2,064 1,889
Operating Profit 153 62 89 155 186 197 155
OPM % 7% 3% 6% 10% 10% 9% 8%
Other Income 73 9 10 13 10 18 12
Interest 63 41 26 14 14 29 20
Depreciation 30 34 30 28 26 24 22
Profit before tax 133 -4 43 126 156 163 125
Tax % 32% 70% 15% 26% 19% 30% 23%
Net Profit 90 -1 36 94 126 114 96
EPS in Rs 61.46 -0.87 24.76 64.11 88.12 79.79 67.97
Source: Screener.in

How to Participate in buyback?

1. Firstly, to be eligible for the buyback the investor should have shares of Savita Oil Technologies Buyback 2021 in demat or physical form as on the record date [05.03.2021] 2. Once you have shares in demat, you can participate in the buyback process which is opening from [Not Available] by selling your shares through your broker on NSE or BSE. 3. Then on [Not Available], 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 142 Shares at CMP of Rs.1107 [200000/1400=142]
Acceptance Ratio 33% 50% 75% 100%
Amount Invested in Buyback 1,57,194 1,57,194 1,57,194 1,57,194
No. of Shares buyback 46 71 106 142
BuyBack Profit 13478 20803 31058 41606
Profit(%) 8.57% 13.2% 19.75% 26%

Recommendation:

Review and Recommendation of Savita Oil Technologies Buyback 2021 by InvestorZone team is: 4/10 [Entitlement = 7%]

    Can I purchase @ 1100 for buy back? Is it going to give me any benefit at this price? Sir, please guide me.