Smartlink Holdings Limited Buyback 2020

Smartlink Holdings Ltd., earlier known as Smartlink Network Systems Ltd. ,  is one of India’s leading networking company. It was established in the year 1993 to prop the Indian market in the field of Network Infrastructure. Pioneer in the field of Active networking, Smartlink has a rich history of making many product brands reach the desired heights in the Indian and international markets. Smartlink now is an NBFC company, with its operations split into 3 wholly-owned subsidiaries to have a focused business approach. The Smartlink subsidiaries are:-

1. DIGISOL SYSTEMS LTD.: DIGISOL Systems Ltd is a brand product company which looks after the sales, marketing, service, and support of DIGISOL brand of active and passive (Structured cabling) products and solutions. The company is headquartered in Mumbai, India.

2. SYNEGRA EMS LTD.: Synergy is an EMS ODM company which is into manufacturing of Active networking range of products. The company has a huge, state of the art manufacturing set up in Goa, India.

3. TELESMART SCS LTD.: Telesmart is an EMS ODM company that looks into manufacturing of Passive (Structured Cabling) range of products in its technologically advanced manufacturing factory set up in Goa, India.

Buy Back Offer Deal:

Buyback Type: Tender Offer
Buyback Record Date: Mar 01 2021
Buyback Opening Date: Apr 30 2021
Buyback Closing Date: May 14 2021
Buyback Offer Amount: ₹ 32.38 Cr
Date of Board Meeting approving the proposal: Dec 04 2020
Date of Public Announcement: Dec 04 2020
Buyback Offer Size: 25%
Buyback Number of Shares: 33,25,000
Price Type: Tender Offer
FV: 2
Buyback Price: ₹ 95 Per Equity Share

Details of Buyback:

The Board of Directors of the Company on 04.12.2020 has inter­alia approved the buyback proposal for purchase by the Company of its own fully paid equity shares of Rs. 2/-each ('Equity Shares')  not exceeding 33,25,000 Equity Shares (approximately being 25% of the total paid-up equity capital of the Company) at a price not exceeding Rs. 95/-  per Equity Share ('Buyback Offer Price'), for an aggregate amount not exceeding Rs. 31.58 Cr through the 'Tender Offer' route.

Salient financial parameters:

Particulars(Cr) Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20
Sales 92.88 0 22.59 18.06 18.53 15.16
Expenses 117.5 16.81 12.5 5.1 42.61 22.78
Operating Profit -24.62 -16.81 10.09 12.96 -24.08 -7.62
OPM % -26.51% 44.67% 71.76% -129.95% -50.26%
Other Income 41.37 32.26 4.71 2.83 0.84 -4.21
Interest 0 0.05 0.15 0.07 0.05 0.39
Depreciation 3.27 1.38 1.2 1.28 1.02 1.43
Profit before tax 13.48 14.02 13.45 14.44 -24.31 -13.65
Tax % 2.00% 68.76% 61.49% 23.75% -14.07% 3.66%
Net Profit 13.21 4.38 5.17 11 -27.72 -13.14
EPS in Rs 4.4 1.46 2.29 4.88 -16.35 -9.88

How to Participate in buyback?

1. Firstly, to be eligible for the buyback the investor should have shares of Smartlink Holdings Limited Buyback 2020 in demat or physical form as on the record date [01.03.2021] 2. Once you have shares in demat, you can participate in the buyback process which is opening from [30.04.2021 to 14.05.2021] by selling your shares through your broker on NSE or BSE. 3. Then on [ Not announced ], the payment will be given to you for accepted shares and unaccepted shares will be returned to your demat account.

Recommendation:

The current market price is above the buyback price. So nothing is there in the buyback at present. Let the price to fall around 75-80 levels, then we will check and revise our strategies.

9 Comments

    How’s India Toner Buyback?
    Does it makes sense to buy at current rate 125?

    Reply

    Appears to be a loss making company.

    How are they bringing buyback? Would SEBI approve?

    Reply

      You can’t raise money for buyback and D/E should not go beyond 2 after the buyback, are some of the regulations which are needed to be followed to get SEBI approval.

      Reply

      Sir I had purchased mayur unicoquoters 605 share@288
      Co accepted only 19 share from for byeback
      Sir pl explain
      & do needful

      Reply

    Last year’s size of the buyback was 54 Crores and AR was 56%. The size of the buyback last year was small. This year that will go further down as they don’t have much to offer in the buyback on their balance sheet.

    Reply

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