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

To track the real time share price of this Buyback, click on this link – https://top10stockbroker.com/share-price/gail-share-price/

GAIL India Limited Buyback Details

Buyback TypeTender Offer
Opening DateFeb 25, 2021
Closing DateMar 10, 2021
Buyback Offer AmountRs.1,046.35 Crore
Buyback No. of Shares6,97,56,641
Face ValueRs.10
Date of Buyback ApprovalJanuary 15, 2021
Date of Public AnnouncementJanuary 18, 2021
Buy Back PriceRs.150
Buy Back Premium44.65%
Date of Board MeetingJanuary 15, 2021

GAIL India Buyback Opening and Closing Date

The starting and closing date of this buyback is from Feb 25, 2021 to Mar 10, 2021.

GAIL India Buyback Cash Offer

Cash Offer to Buy-back up to 6,97,56,641 fully paid-up equity shares of the Company of face value of Rs.10 each, representing 1.55% of the issued, subscribed and paid-up Equity Shares of the Company.

GAIL India Buyback Record Date

The decided record date is JANUARY 28, 2021.

GAIL India Buyback Price

At a price of Rs.150 per Equity Share.

GAIL India Buyback Size

At a buyback price of Rs.150 payable in cash for an aggregate maximum amount of Rs.1,046.35 Crore.

GAIL India Limited Buyback Acceptance Query

You can check for Buyback Acceptance query here. Just click on the given link and it will redirect you to buyback acceptance query page.


GAIL India 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%200150300005300.36%
40%4001506000010600.72%
60%6001509000015901.08%
80%80015012000021201.44%
100%100015015000026501.80%

Profit is calculated from Feb 23, 2021 share price i.e. Rs.147.35 per share of GAIL India Limited.

According to the above table, if a shareowner applies for 1000 shares of GAIL India limited & gets 20% acceptance from the company and the owner with 1000 shares will sell 200 shares @ Rs.150 per share & receive Rs.530 as profit amount & 0.36% 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.150 & receive a profit of Rs.1590 @ 1.08% profit percentage.


GAIL India Buyback Overview

GAIL India Buyback

GAIL (India) Limited (“GAIL”), a Maharatna Company, was incorporated on August 16, 1984 as a Central Public Sector Enterprise under the name Gas Authority of India Limited under Ministry of Petroleum & Natural Gas, Govt. of India with mission of “Accelerating and optimizing the effective and economic use of Natural Gas and its fractions for the benefit of the national economy”.

Well, GAIL has its presence along entire natural gas value chain comprising of gas transmission & marketing, LPG transmission, gas processing, petrochemical, LNG imports, Exploration & Production and city gas distribution. GAIL has also diversified into renewable energy business.


GAIL India Buyback – Company Finances

The brief audited consolidated financial information of the Company for the last 3 financial years are:

[In Rs. Crores]

ParticularsSep 30, 2020 (Unaudited)12 Months period ended March 31
(Audited)
2020202020192018
Total Income26,697.1873,293.1976,671.5754,812.49
Total Expenses (excluding finance costs, depreciation & amortization, tax and exceptional items)23,771.1463,506.9765,571.6646,191.56
Interest76.93108.50138.54275.11
Depreciation942.581,835.991,550.221,415.14
Profit before tax1,906.537,943.369,084.826,958.37
Profit /(Loss) after tax1,495.186,620.636,025.674,618.41
Equity Share Capital4,510.144,510.142,255.072,255.07
Reserve and Surplus38,922.1537,343.8536,946.9932,986.43
Networth43,432.2941,853.9939,202.0635,241.50
Total Debt3,828.633,757.101,001.052,080.46

GAIL India Limited Buyback Dates

Date of Board Meeting approving the BuybackJanuary 15, 2021
Date of publication of Public Announcement for BuybackJanuary 19, 2021
Record Date for determining the Buyback Entitlement and the names of Eligible ShareholdersJanuary 28, 2021
Buyback Opening dateFebruary 25, 2021
Buyback Closing dateMarch 10, 2021
Last Date of verification of Tender Forms by the RegistrarMarch 17, 2021
Last date of intimation regarding acceptance / non-acceptance of Tendered Equity Shares to the BSE Limited by the RegistrarMarch 18, 2021
*Last date of Settlement of Bids on the BSE LimitedMarch 19, 2021
Last date of return of unaccepted Equity Shares by BSE LimitedMarch 19, 2021
*Last date of Extinguishment of Equity SharesMarch 26, 2021

Details of Public Announcement

This is to say, in accordance with Regulation 7(i) of the Buyback Regulations, the Public Announcement was published on January 19, 2021 in the following newspapers:

PublicationLanguageEdition
Business StandardEnglishAll Editions
Business StandardHindiAll editions

Necessity of GAIL India Buyback

The Buyback would help in optimization of the capital structure and improving return on equity, by reduction in the equity base, thereby leading to long term increase in shareholders‟ value.

Further, the Buyback, which is being implemented through the Tender Offer route as prescribed under the Buyback Regulations, would involve allocation of higher of number of shares as per their entitlement or 15% of the number of shares to be bought back, reserved for the 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”.


Impact of GAIL India Buyback on the Company

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

They believe the Buyback will not in any manner impair the ability of the Company to pursue growth opportunities or meet its cash requirements for business operations. The Buyback is expected to contribute to the overall enhancement of shareholder value and result in an increase in the return on equity of the Company.

In terms of the Buyback Regulations, under the Tender Offer route, the promoter and promoter group of the Company have an option to participate in the Buyback.

The Buyback of Equity Shares will not result in a change in control or otherwise affect the existing management structure of the Company.

The debt-equity ratio post Buyback will be compliant with the permissible limit of 2:1 prescribed by Section 68 of the Companies Act and Regulation 4(ii) of the Buyback Regulations, even if the response to the Buyback is to the extent of 100% (full acceptance).

Salient financial parameters consequent to the Buyback based on the latest audited financial statement of the Company for September 30, 2020 are as under:

Parameters (based on audited standalone financial statements for September 30, 2020)Pre Buy-backPost Buy-back
(Assuming Full Acceptance)
Net worth (Rs in crores)41,853.9940,807.64
Return on Net worth (%)15.8216.22
Earnings Per Share (Rs)14.6814.91
Book Value per Share (Rs)92.8091.90
Price / Earnings Ratio (P/E)**5.215.13
Total Debt / Equity Ratio0.130.14

Basis of Calculating GAIL India Buyback Price

The Buyback Offer Price of Rs. 150/- per Equity Share has been arrived at after considering various factors such as the average closing prices of the Equity Shares on the Stock Exchanges where the Equity Shares of the Company are listed, the net-worth of the Company and the impact of the Buyback on the key financial ratios of the Company.

The Buyback Offer Price of Rs. 150/- per Equity Share represents

(i) a premium of 44.65% on BSE and 41.14% on NSE over the volume weighted average price of the Equity Shares on BSE and NSE, respectively for 26 weeks preceding the Board Meeting date;

(ii) Here, a premium of 10.13% on BSE and 10.28% on NSE over the volume weighted average price of the Equity Shares on BSE and NSE, respectively for 2 weeks preceding the Board Meeting date;

(iii) a premium of 10.54% on BSE and 10.54% on NSE over the closing price of the Equity Shares on BSE & NSE, respectively as on the date of intimation to BSE & NSE for the Board Meeting to consider the proposal of the Buyback.

The closing market price of the Equity Shares as on the date of intimation to the BSE and NSE for the Board Meeting for considering the Buyback i.e. January 11, 2021, was Rs. 135.70 per Equity Share and Rs. 135.70 per Equity Share, respectively.


Source of Funds for the Buyback

Assuming full acceptance, the funds that would be employed by the Company for the purpose of the Buyback of 6,97,56,641 Equity Shares at a price of Rs. 150/- per Equity Share would be Rs. 1,046.35 Crore/-

The Buyback shall be made out of the free reserves of the Company as at March 31, 2020 (i.e. the last audited standalone and consolidated financial statements available as on the date of Board Meeting recommending the proposal of the Buyback). The Company shall transfer from its free reserves a sum equal to the nominal value of the Equity Shares 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.

Funds for the Buyback will be met out of internally generated cash resources of the Company. The Company does not intend to raise additional debt for the explicit purposes of the Buyback. Accordingly, borrowed funds will not be used for the Buyback. However, if required, the Company may borrow funds in the ordinary course of its business.

This Buyback is not likely to cause any material impact on the earnings of the Company, except for the cost of financing the Buyback, being a reduction in the treasury income that the Company could have otherwise earned on the funds deployed.


GAIL India Limited – Manager to the Buyback

IDBI Capital Markets & Securities Limited
6th floor, IDBI Tower, WTC Complex, Cuffe Parade,
Mumbai 400 005
Tel No.:+91 22 2217 1700
Fax No.: +91 22 2215 1787
Contact Person: Sumit Singh
Email: gail.buyback2021@idbicapital.com
Website: www.idbicapital.com
SEBI Registration Number: INM000010866
Validity Period: Permanent
CIN: U65990MH1993GOI075578

GAIL India Ltd – Registrar to the Buyback

MCS Share Transfer Agent Limited
F-65, 1st Floor, Okhla Industrial Area, Phase-1, New Delhi – 110020
Tel No: 011-41406149
Fax: 011-41709881
Contact Person: Mr. Amarjit Singh
Email: admin@mcsregistrars.com
Website: www. mcsregistrars.com
SEBI Registration Number : INR000004108
Validity Period: Permanent
CIN: U67120WB2011PLC165872

GAIL India Ltd Contact Details

Company Contact Details
GAIL (INDIA) LIMITED
(A Government of India Undertaking-A Maharatna Company)
Registered Office: 16, Bhikaiji Cama Place, R. K. Puram, New Delhi-110066
CIN: L40200DL1984GOI018976
Contact Person: A. K. Jha, Company Secretary & Compliance Officer
Tel.: 011-26170740, Fax: 011-26170740 | E-mail: shareholders@gail.co.in | Website: www.gailonline.com

 


GAIL India Limited Buyback News

News 1 – Buyback PDF / Draft Letter of Offer [Download]

News 2 –  GAIL India Buyback / Letter of Offer [Download]


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