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FDC Limited Buyback Review, Offer Details, Price, Dates & more

In this article, we will discuss the FDC Limited Buyback offer, buyback price, buyback size, record date, company financial, buyback necessity and its impact on the company.

FDC Limited Buyback Details

Buyback TypeTender Offer
Buyback Opening DateJuly 01, 2019
Buyback Closing DateJuly 12, 2019
Buyback Offer AmountRs. 120,05,oo,ooo/-
Buyback No. of Shares34,30,000
Face ValueRe. 1
Date of Buyback ApprovalMay 24, 2019
Date of Public AnnouncementJune 07, 2019
Buy Back PriceRs. 350/-
Buy Back Premium106.79%
Date of Board MeetingMay 24, 2019

FDC Limited Buyback Opening and Closing Date

The starting and closing dates of this buyback are July 01, 2019 to July 12, 2019.

FDC Limited Buyback Cash Offer

The Cash Offer to Buy-back up to 34,30,000 fully paid-up equity shares of the Company of face value of Re. 1 each, representing 1.97% of the total number of equity shares.

FDC Limited Buyback Record Date

The decided record date is Friday, June 07, 2019.

FDC Limited Buyback Price

At a price of Rs. 350 (Rupees Three Hundred Fifty Only) per Equity Share.

FDC Limited Buyback Size

At a buyback price of Rs. 350/- payable in cash for an aggregate consideration not exceeding Rs. 120,05,oo,ooo/- (One Hundred Twenty Crores Five Lakhs Only).


FDC Limited Buyback Acceptance Ratio

Find profit & profit percentage based on various acceptance rate, The profit is calculated based on 1000 shares.

Acceptance RatioTotal Shares AcceptedBuyback PriceBuyback AmountProfitProfit%
20%200350700003500020.00%
40%4003501400007000040.00%
60%60035021000010500060.00%
80%80035028000014000080.00%
100%1000350350000175000100.00%

Profit is calculated from 24th June 2019 share price i.e. Rs.175 per share of FDC Limited.

According to the above table, if a share owner applies for 1000 shares of FDC Limited & gets 20% acceptance from the company, the owner of this 1000 shares will sell 200 shares @ Rs.350 per share & receive Rs.35000 as profit amount & 20.00% profit percentage on selling these 200 shares back to the company.

Similarly, if the owner gets 60% acceptance of share from the company, the owner will sell 600 shares @ Rs.350 & receive a profit of Rs.105000 @ 60.00% profit percentage.


Buyback Overview – FDC Limited

The Company has a diversified portfolio of products with presence in various therapeutic groups such as Oral Rehydration Salts, Ophthalmology, Dermatology, Anti-biotics, Anti-virals, Cardiovascular and Antidiabetes. FDC Limited markets more than 300 products in India and exports many of these to over 50 countries.

It is a multi plant, multi locational Company having its research center located at Jogeshwari, Mumbai and manufacturing facilities at Roha, Waluj, and Sinnar in Maharashtra, Verna in Goa and Baddi in Himachal Pradesh.

The Company has a widespread marketing and distribution network spread across the country. The Company also exports to many countries around the globe.


Company Finances – FDC Limited

The salient financial information of the Company as extracted from the audited Financial Statements for the last three financial years ended March 31, 2019, March 31, 2018 and March 31, 2017 are as given below:

Consolidated [In Rs. Crores]

ParticularsFinancial year ended
March 31, 2019
(Audited)
March 31, 2018
(Audited)
March 31, 2017
(Audited)
Equity Share Capital17.5217.5217.86
Reserves and Surplus1,425.161,255.761,251.79
Net worth (excluding other comprehensive income
and revaluation reserves)
1,442.681,273.281,269.65
Total Income1,134.171,134.051,101.20
Profit before Depreciation, Interest and Tax&
exceptional items
272.42277.17293.74
Interest1.441.401.41
Depreciation33.2435.1434.62
Exceptional items1.115.88
Profit before Tax236.64240.63251.83
Tax66.8567.1263.30
Profit After Tax169.79173.51188.53

Important Dates – FDC Limited

Date of Board Meeting approving the BuybackMay 24, 2019
Date of publication of Public Announcement for BuybackMay 27, 2019
Record Date for determining the Buyback Entitlement and the names of Eligible ShareholdersJune 07, 2019
Buyback Opening dateJuly 01, 2019
Buyback Closing dateJuly 12, 2019
Last Date of verification of Tender Forms by the RegistrarJuly 17, 2019
Last date of intimation regarding acceptance / non-acceptance of Tendered Equity
Shares to the BSE Limited by the Registrar
July 18, 2019
Last date of Settlement of Bids on the BSE LimitedJuly 19, 2019
Last date of return of unaccepted Equity Shares by BSE LimitedJuly 19, 2019
Last date of Extinguishment of Equity SharesJuly 26, 2019

Details of Public Announcement

In accordance with the provisions of the Regulation 7(i) of the SEBI Buyback Regulations, the Company has made a Public Announcement for the Buyback of Equity Shares which was published on May 27, 2019 in all editions of Business Standard (English national daily, Hindi national daily) and Loksatta (Aurangabad Marathi language daily) with wide circulation within two working days from the date of passing of the resolution by the Board, i.e. May 24, 2019, approving the Buyback.


Necessity of FDC Limited Buyback

The Company’s management strives to increase Shareholder’s value and the Buyback would result in, amongst other things:

  • A reduction in the overall capital employed in the business, which will, in turn lead to higher earnings per share and enhanced return on equity and return on capital employed, return on net worth, return on assets, etc and long term increase in shareholders’ value;
  • The Buyback will help the Company to distribute surplus cash to its Members holding equity shares broadly in proportion to their shareholding, thereby, enhancing the overall return to Members;
  • The Buyback, which is being implemented through the Tender Offer route as prescribed under the SEBI Buyback Regulations, would involve allocation of 15% of the outlay to Small Shareholders. The Company believes that this reservation of 15% for Small Shareholders would benefit a large number of public shareholders, who would get classified as “Small Shareholder”; and
  • The Buyback gives an option to the Members holding equity shares of the Company, who can choose to participate and get cash in lieu of Equity Shares to be accepted under the Buyback Offer or they may choose to not participate and enjoy a resultant increase in their percentage shareholding, post the Buyback Offer, without additional investment.

Impact of FDC Limited Buyback on the Company

The Buyback is not likely to cause any material impact on the earnings of the Company except a reduction in the amount available for investment, which the Company could have otherwise deployed towards generating investment income.

Assuming response to the Buyback is to the extent of 100% (full acceptance) from all the Shareholders up to their Buyback Entitlement, the aggregate shareholding of the Promoter Group, post the Buyback may increase to [●]% from 69.07% prior to the Buyback, and the aggregate shareholding of the public in the Company post Buyback may decrease to [●]% from 30.93% prior to the Buyback.

The post Buyback, both on standalone and consolidated basis, debt-equity ratio of the Company will be below the maximum allowable limit of 2:1 specified under the Act.

Salient financial parameters consequent to the Buyback based on the audited financial statements for the year ended March 31, 2019, of the Company are as under:

(a)  Standalone Financial Statements
RatiosPre BuybackPost Buyback
Net Worth (Rs. in crores)1,432.991,312.94
Return on Networth (%age)11.97%13.07%
Earnings Per Share (in Rs.)
– Basic
– Diluted
9.84
9.84
10.03
10.03
Book Value per Share (in Rs.)81.7976.79
Price / Earnings multiple as per latest audited Financial Statements18.4018.05
Total Debt / Equity Ratio0.00030.0004
(b) Consolidated Financial Statements
RatiosPre BuybackPost Buyback
Net Worth (Rs. in crores)1,442.681,322.63
Return on Networth (%age)11.77%12.84%
Earnings Per Share (in Rs.)
– Basic
– Diluted
9.74
9.74
10.10
10.10
Book Value per Share (in Rs.)82.3577.01
Price / Earnings multiple as per latest audited Financial Statements18.5917.93
Total Debt / Equity Ratio0.00040.0005

Basis of Calculating FDC Limited Buyback Price

The Buyback Price has been arrived at after considering various factors, including, but not limited to the trends in the volume weighted average prices of the Equity Shares of the Company on BSE Limited and National Stock Exchange of India Limited, where the equity shares of the Company are listed, the networth of the Company, price earnings ratio, industry multiple and the possible impact of the Buyback on the key financial ratios of the Company.

More on FDC Buyback Price Calculation

The Buyback Price of Rs. 350 per Equity Share represents:

  • A premium of approx. 107.04% and 106.79% over the closing prices on the NSE and BSE respectively on May 20, 2019, being the working day immediately preceding the date on which Company intimated the Stock Exchanges of the date of meeting of the Board of Directors wherein the proposal for Buyback was considered;
  • A premium of approx. 109.13% and 110.48% over the volume weighted average price of the Equity Shares on the NSE and BSE respectively during the 60 working days preceding May 21, 2019, being the day on which Company intimated the Stock Exchanges of the date of meeting of the Board of Directors wherein the proposal for Buyback was considered; and
  • A premium of approx. 30.01% and 29.92% over the 52 week high price of the Equity Shares on NSE and BSE respectively, immediately before the date of the Board Meeting in which the Buyback was approved.

Source of Funds for the FDC Limited Buyback

The Buyback shall be made out of the Free Reserves of the Company as at March 31, 2019 based on the audited standalone financial statements of the Company for the year ended March 31, 2019.

The Company shall transfer a sum equal to the nominal value of the Equity Shares so bought back through the Buyback to the Capital Redemption Reserve Account and the details of such transfer shall be disclosed in its subsequent audited Balance Sheet.

The funds for the Buyback will be sourced from internal accruals of the Company. The Company does not intend to raise any debt for the explicit purposes of the Buyback. Thus, borrowed funds will not be used for the Buyback. However, if required, the Company may borrow funds in the ordinary course of its business.


FDC Limited – Manager to the Buyback

Sundae Capital Advisors Private Limited
611, Shahpuri Tirath Singh Tower
58, C – Block, Community Centre
Janak Puri, New Delhi – 110 058
Tel. No. +91 11 4914 9740
Email: [email protected]
Investor Grievance e-mail id: [email protected]
Website: www.sundaecapital.com
SEBI Regn. No.: INM000012494
Validity Period : Perpetual
Contact Person: Nitin Somani / Anchal Lohia

FDC Limited – Registrar to the Buyback

Sharex Dynamic (India) Private Limited
Unit-1, Luthra Industrial Premises, Safed Pool
Andheri Kurla Road, Andheri (East)
Mumbai – 400 072
Tel.: +91 22 2851 5606 / 44
Fax: +91 22 2851 2885
Contact Person: K C Ajit Kumar
E-mail: [email protected]
Website: www.sharexindia.com
SEBI Registration No.: INR000002102

FDC Limited Contact Details

Company Contact Details
FDC Limited

(CIN: L24239MH1940PLC003176)
Registered Office
: B-8, M.I.D.C. Industrial Estate, Waluj – 431 136, Dist. Aurangabad, Maharashtra
Tel: +91 240 255 4407; Fax: +91 240 255 4299
Correspondence Address: C-3 SKYVISTAS, Near Versova Police Station 106A, J. P. Road, Andheri (West), Mumbai – 400053
Tel: +91 22 2673 9215 Website: www.fdcindia.com,
Compliance Officer: Ms. Varsharani Katre, Company Secretary

 


Buyback News

News 1 – BUYBACK PDF / Letter of Offer [Download]


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