Welspun Enterprises Buyback 2022

Welspun Enterprises Limited (WEL), part of the Welspun Group, is an operating Company as well as a holding company. The year of 2014-15 was a year of consolidation for the company. During the year, the company divested its DRI business; Welspun Maxsteel Ltd. The company had identified this business as non-core and therefore exited the same. As part of further consolidation, pursuant to Scheme of Arrangement and Amalgamation made effective from May 11, 2015, the erstwhile Welspun Enterprises Limited, Welspun Infratech Limited, Welspun Plastics Private Limited and Welspun Infra Projects Private Limited were merged into the Company. This consolidation will enable the Company to better leverage the combined strengths of the entities, synergies arising out of consolidation of business such as, enhancement of net worth of the combined business to capitalise on future growth potential, optimal utilisation of resources, reducing operating and compliance cost and achieving operational and management efficiency. It will aid the Company to target opportunities which need large free cash and strong balance sheet. The merger has helped to consolidate and simplify corporate structure of WEL and its subsidiaries

The Company’s key activity is in the infrastructure business. Apart from that, the company holds equity investments in Welspun Natural Resources Private Limited (Oil & Gas Exploration).In infrastructure, WEL has developed and operates PPP projects in various sectors like roads, water, and urban infrastructure. In the highway sector alone, the Company has successfully completed six BOT (Toll) Road projects with a total length of over 500 km. By March 31st 2018, the Company has substantially completed India’s first HAM project -Delhi-Meerut Expressway Package 1 (Delhi Section), demonstrating operational excellence by remaining well ahead of the scheduled construction.

 

 

 

 

Buy Back Offer Deal:

Buyback Type: Tender Offer
Buyback Record Date: Feb 13 2023
Buyback Offer Amount: ₹ 235 Cr
Date of Board Meeting approving the proposal: Dec 30 2022
Date of Public Announcement: Dec 30 2022
Buyback Offer Size: 7.8%
Buyback Number of Shares: 1,17,50,000
Price Type: Tender Offer
FV: 10
Buyback Price: ₹ 200 Per Equity Share

Details of Buyback:

The proposal to buyback not exceeding  1,17,50,000 (One Crore Seventeen Lakh Fifty Thousand ) equity shares of face value of Rs. 10 of the Company (representing 14.22% of the total number of equity shares in the paid-up share capital of the Company) at a price of ~ 200 (Rupees Two Hundred Only) per equity share payable in cash for an aggregate consideration not exceeding 235 Cr (Rupees Two Hundred Thirty Five Crore Only).

Salient financial parameters:

Particulars (in Cr) Mar 2018 Mar 2019 Mar 2020 Mar 2021 Mar 2022
Sales + 1,067 1,787 1,808 1,530 1,401
Expenses + 990 1,608 1,617 1,365 1,252
Operating Profit 77 179 191 164 149
OPM % 7% 10% 11% 11% 11%
Other Income + 95 93 112 142 174
Interest 33 54 77 110 140
Depreciation 24 11 23 16 16
Profit before tax 116 207 203 180 167
Tax % 40% 39% 25% 28% 25%
Net Profit 69 127 151 130 126
EPS in Rs 4.71 8.56 10.03 8.66 8.33

How to Participate in buyback?

1. Firstly, to be eligible for the buyback the investor should have shares of Welspun Enterprises Buyback Offer 2022 in  Demat or physical form as on the record date [13-02-2023] 2. Once you have shares in Demat, you can participate in the buyback process which is opening from [To Be Updated] by selling your shares through your broker on NSE or BSE.
3. Then on [To Be Updated], 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 1000 Shares at CPM of Rs. 166 (2,00,000/200)
Acceptance Ratio 33% 50% 75% 100%
Amount Invested in Buyback 1,66,000 1,66,000 1,66,000 1,66,000
No. of Shares buyback 330 500 750 1000
Buy Back Profit 11,220 17,000 25,500 34,000
Profit(%) 6.75% 10.24% 15.36% 20.48%
 

17 Comments

    Hello .. I’m investing first time in buyback amount 50000 .. can anyone tell me acceptance ratio

    Reply

      Acceptance ratio cant tell now
      It decided after total bids in buyback. Which takes more time from Record Date. Like 45-55 days.

      But as per December share holding pattern we can expect 12-14% Entitlement ratio
      And
      25% acceptance ratio.

      Reply

        25% is less… can I expect 50- 60% AR ….
        Or should I hold money for better buyback… like Hinduja and sportking …
        But I think welspun is better then these. …can you guide

        Reply

    Today appears to be a chance day for accumulating this share for buyback.. Still high risk, seeing market free fall

    Reply

        Welspun had run well and make sense to buy at 135-140, specifically after release of dividend. Expecting a further fall…

        Reply

    Total Shares = 14,97,55,073
    Shares to be Bought in buyback = 1,17,50,000
    The offer size appears to be 7.8% and not 14.22%,
    Please check and correct, if not?

    Reply

    82,57,561 shares held by Investors holding upto 1000 shares (as of Shareholding Pattern as on March 31, 2022).
    15% of total buyback shares = 17,62,500.
    With this, the entitle ratio could be around 20%.
    Please note there is also dividend of Rs7.50 on record date of 11/01/2023.

    This may open gap up on Monday 02/01. We have time until the second Monday 09/01 to buy with the special dividend.

    Reply

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