TD Power Systems Limited Buyback offer 2018

(i) TD Power Systems Limited was incorporated on April 16, 1999. and the company was listed on the Bombay Stock Exchange and the National Stock Exchange On September 8th 2011.

(ii) TD Power Systems Limited is one of the leading manufacturers of AC Generators in the world with products in the output range of 1 MW to 200 MW for prime movers, such as steam turbines, gas turbines, hydro turbines, diesel engines, gas and wind turbines We also manufacture special application generators for Geo Thermal and Solar thermal applications. We focus on manufacturing custom-designed generators for our customers who are based all over the world. TDPS generators are designed to perform with the highest efficiency. Reliability is ensured by world-class manufacturing processes and quality control.We have supplied 2500 generators working in 72 countries across the globe. We have service partners in 19 countries covering all continents.

(iii)TD Power Systems Limited has its own technology for generators up to 55 MW and is a licensee of Siemens AG for 2 Pole generators from 55 MW up to 200 MW. The Company’s wholly owned Subsidiary, DF Power Systems Private Limited, is in the business of Engineering, Procurement and Construction (“EPC”), executing Boiler-Turbine Generator (“BTG”) island projects and the balance of plant (“BOP”) portion for steam turbine power plants with output capacity from 20 MW up to 150 MW (“EPC Business”). The scope of work for the EPC Business comprises of design services, civil works, procurement and supply of equipment, assembly, installation and commissioning.

Buy Back Offer Deal:

Buyback Type: Open Market
Buyback Opening Date: Oct 10 2018
Buyback Closing Date: Apr 09 2019
Buyback Offer Amount: ₹ 30 Cr
Date of Board Meeting approving the proposal: Sep 26 2018
Date of Public Announcement: Sep 26 2018
Buyback Offer Size: 6.16%
Buyback Number of Shares: 11,71,875
FV: 10
Buyback Price: ₹ 256 Per Equity Share

Details of Buyback:

The Board of Directors of the Company, at its meeting held on 26.9.2018, have approved the buyback of fully paid up Equity Shares of a face value of Rs.10 each ("Equity Shares" and such buyback, the "Buyback"), for an aggregate amount not exceeding Rs.30 Crores (Rupees Thirty Crores only) excluding expenses like filing fees payable to the Securities and Exchange Board of India, stock exchange fees, advisors fees, public announcement publication expenses, transaction cost viz., brokerage, applicable taxes such as securities transaction tax, stamp duty, etc., and any other incidental and related expenses ("Maximum Buyback Size"), at a price not exceeding Rs.256/- (Rupees Two Hundred Fifty Six Only) per Equity Share payable in cash ("Maximum Buyback Price") from the Open market through stock exchange mechanism in such manner as may be prescribed in the Securities and Exchange Board of India (Buy Back of Securities) Regulations, 2018

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: “TD Power Systems Limited” announces buyback plan of its shares up to value of Rs.256, it means that the company will be purchasing shares of "TD Power Systems Limited" from the open market at a price not exceeding Rs.256 per share. Scenario 1- If the share price is below Rs. 256, in that case, the company will put buy order at Current Market Price and purchase shares. Scenario 2- If the share price is above Rs. 256, in that case, the company will put buy order at Rs. 256 only and if someone is ready to sell at Rs.256 or less then only company will get back shares.

Profit from the buyback on the bases of acceptance Ratio:

TD Power Systems Limited Buyback is an Open Market BuyBack In this method of share buyback, the company buys its own stocks from the market. This transaction happens through the company’s brokers. This repurchase program happens for an extended period of time as a large block of shares needs to be bought. The company is under no obligation to conduct the repurchase program after the announcement. The company has the option to cancel it. Also, it can make changes in the repurchase program according to company’s situations and needs. If this method is effectively implemented, it can prove to be very cost effective.

Recommendation:

TD Power Systems Limited Buyback 2018 Rating by InvestorZone team => 2 (Avoid) 1-5: Fair 5-7: Good 7-10: Excellent

Company Contact Details:

TD Power Systems Limited 27, 28 and 29, KIADB Industrial Area Dabaspet, Nelamangala Taluk Bengaluru Rural District Bengaluru – 562 111 India Phone No. +91 80 229 95700 / 6633 7700 Mail id : tdps@tdps.co.in website : www.tdps.co.in

    Incase, buy back really takes place from open market, 11,71,875 quantity of shares will be absorbed from open market. Thus creating a supply scarcity in market. Consolidated loss but company may wipe out the accumulated losses and may become a profit making company in years to come.

    i don’t understand the logic of open buyback
    let’s take this case

    1) above rs 256 : why will anyone sell at 256
    2) below 256 : anyways we can sell in open market

    Completely agree with Sumit Bhai. The open Market buyback is just a joke. It has nothing for the investors to gain.