In this article, we will discuss about Metroglobal Limited Buyback offer, buyback price, buyback size, record date, company financial, buyback necessity and its impact on company.
Metroglobal Limited Buyback Details
|Buyback Type||Tender Offer|
|Buyback Opening Date||May 14, 2019|
|Buyback Closing Date||May 27, 2019|
|Buyback Offer Amount||Rs. 22,40,00,000/-|
|Buyback No. of Shares||40,00,000|
|Face Value||Rs. 10|
|Date of Buyback Approval||March 30, 2019|
|Date of Public Announcement||April 02, 2019|
|Buy Back Price||Rs. 56|
|Buy Back Premium||1.71%|
Metroglobal Buyback Opening and Closing Date
The starting and closing date of this buyback is from May 14, 2019 to May 27, 2019.
Metroglobal Buyback Cash Offer
The Cash Offer to Buy-back up to 40,00,000 (Forty Lakhs) fully paid-up equity shares of the Company of face value of Rs. 10 each.
Metroglobal Buyback Record Date
The decided record date is Friday, April 12, 2019.
Metroglobal Buyback Price
At a price of Rs. 56 (Rupees Fifty Six Only) per Equity Share.
Metroglobal Buyback Size
For an aggregate amount not exceeding Rs. 22,40,00,000 (Rupees Twenty Two Crores Forty Lakhs Only) excluding cost such as fees, brokerage, securities transaction tax, goods and services tax, stamp duty, etc.
As required under the Buy-back Regulations, Equity Shares to be bought back are divided into two categories: (i) reserved category for Small Shareholders (as defined hereinafter); and (ii) general category for all other shareholders.
Metroglobal Buyback Acceptance Ratio
Find profit & profit percentage based on various acceptance rate, The profit is calculated based on 1000 shares.
|Acceptance Ratio||Total Shares Accepted||Buyback Price||Buyback Amount||Profit||Profit%|
Profit is calculated from 12th May 2019 share price i.e. Rs.54.15 per share of Metroglobal Limited.
According to the above table, if a share owner applies for 1000 shares of Metroglobal limited & gets 20% acceptance from the company, the owner of this 1000 shares will sell 200 shares @ Rs.56 per share & receive Rs.370 as profit amount & 0.68% 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.56 & receive a profit of Rs.1,110 @ 2.05% profit percentage.
Metroglobal Limited Buyback Overview
The Company was originally incorporated as “Chromo Boards and Papers India Limited” on November 12, 1992 under the Companies Act, 1956.
The name of the Company was subsequently changed to “Global Boards Limited” vide fresh certificate of incorporation consequent on change of name dated October 11, 1993 issued by the Registrar of Companies, Maharashtra, Mumbai.
Further changed to “Metroglobal Limited” vide fresh certificate of incorporation consequent on change of name dated September 08, 2011 issued by the Registrar of Companies, Maharashtra, Mumbai.
The Company is engaged in the business of trading of various items, i.e. Chemicals, Plastics, Textiles etc. and also into Realty business. The Equity Shares of the Company are listed and traded on BSE Limited under scrip code – 500159.
Company Finances – Metroglobal Limited
As per audited standalone financial statements for the financial years ended March 31, 2018, 2017 and 2016, the
Company recorded total income of Rs. 33,874.88 Lakhs, Rs. 35,214.81 Lakhs and Rs. 35,919.72 Lakhs respectively,
and Profit after Tax of Rs.1,770.57 Lakhs, Rs.1,501.96 Lakhs and Rs.1,556.00 Lakhs respectively.
As per limited review unaudited standalone financial results for nine months period ended on December 31, 2018, the Company recorded total income of Rs. 29,313.37 Lakhs and Profit after Tax of Rs. 1,015.86 Lakhs.
|Total Expenses (excluding Finance Costs and|
|Profit Before Tax||2,337.00||1,769.35||1,971.86|
|Profit After Tax||1,787.00||1,350.95||1,571.86|
|Other Comprehensive Income||9.50||Not Applicable||Not Applicable|
|Total Comprehensive Income for the Year||1,796.50||Not Applicable||Not Applicable|
|Equity Share Capital||1,632.67||1,632.67||1,632.67|
|Reserves & Surplus*||27,491.70||25,638.63||24,340.99|
|Total debt (excluding working capital loans)||4,442.31||6,348.42||5,507.79|
Metroglobal Limited Buyback Dates
|Date of the Board meeting held to approve the proposal for Buy-back of Equity Shares||Saturday, March 30, 2019|
|Date of publication of Public Announcement for the Buy-back||Tuesday, April 02, 2019|
|Record Date for determining the Buy-back Entitlement and the Eligible Shareholders||Friday, April 12, 2019|
|Buy-back opens on / Buy-back Opening Date||Tuesday, May 14, 2019|
|Buy-back closes on / Buy-back Closing Date||Monday, May 27, 2019|
|Last date of verification by Registrar to Buy-back||Tuesday, June 04, 2019|
|Last date of intimation to the Stock Exchange regarding acceptance or non-acceptance of tendered Equity Shares by the Registrar and Manager to the Buy-back||Tuesday, June 04, 2019|
|Last date of settlement of bids on the Stock Exchange||Thursday, June 06, 2019|
|Last date of return of unaccepted demat shares by Stock Exchange to Seller Member / Broker||Thursday, June 06, 2019|
|Last date of extinguishment of Equity Shares bought back||Thursday, June 13, 2019|
Necessity of Metroglobal Limited Buyback
The Buy-back is being undertaken by the Company to partly return surplus funds to the equity shareholders of the Company. Additionally, the Buy-back is being undertaken for the following reasons:
- The Buy-back will help the Company to distribute surplus funds to its shareholders holding Equity Shares broadly in proportion to their shareholding, thereby, enhancing the overall return to the shareholders;
- The Buy-back, which is being implemented through the Tender Offer as prescribed under the Buy-Back Regulations, would involve a reservation of 15% of the Buy-back Size for small shareholders. The Company believes that this reservation for small shareholders would benefit a large number of public shareholders, who would get classified as “Small Shareholders” as defined under Regulation 2(i)(n) of the Buy-Back Regulations;
- The Buy-back may help in improving financial ratios like earnings per share, return on assets and return on equity calculated on the basis of financial statements, by reducing the equity base of the Company; and
- The Buy-back gives an option to the Eligible Shareholders to either choose to participate in the Buy-back and receive cash in lieu of their Equity Shares which are accepted under the Buy-back or choose not to participate in the Buy-back and get a resultant increase in their percentage shareholding in the Company post Buy-back, without additional investment.
Impact of Metroglobal Limited Buyback on the Company
The Company believes that the Buy-back is not likely to cause any material impact on the profitability / earnings of the Company except to the extent of reduction in the amount available for investment, which the Company could have otherwise deployed towards generating investment income.
Assuming that the response to the Buy-back is 100% (full acceptance) from all the Eligible Shareholders in proportion of their respective Buyback Entitlement, the funds deployed by the Company towards the Buy-back would be Rs. 2,240 Lakhs excluding Transaction Costs.
The debt-equity ratio immediately on completion of Buy-back shall be in compliance with the permissible limit of 2:1 prescribed under the Act even if the response to the Buy-back is 100% (full acceptance) from all the Eligible Shareholders in proportion to their respective Buy-back Entitlement.
|Net Worth (Rs. in Lakhs)||29,124.37||26,884.37||29,256.69||27,016.69|
|Return on Net Worth (%)||6.14%||6.65%||6.05%||6.55%|
|Earnings Per Share (EPS) (Basic) (in Rs.)||11.00||14.57||10.90||14.44|
|Book Value per share (in Rs.)||178.38||218.10||179.19||219.17|
|Price / Earnings Multiple||6.96||5.26||7.03||5.30|
|Total Debt / Equity Ratio||0.23||0.25||0.23||0.25|
Basis of Calculating Metroglobal Buyback Price
The Equity Shares are proposed to be bought back at a price of Rs. 56 (Rupees Fifty Six only) per Equity Share. The Buy-back Price has been arrived at after considering various factors, including but not limited to, the volume weighted average market price of the Equity Shares of the Company on BSE during 3 (three) months and 2 (two) weeks preceding the date of the Board Meeting and closing market price on the date prior to Board Meeting date.
The Buy-back Price represents a premium of 1.71% over the volume weighted average market price of the Equity Shares on BSE for 3 (three) months preceding the date of the Board Meeting which was Rs. 55.06 and 6.05% over the volume weighted average market price of the Equity Shares on BSE for 2 (two) weeks preceding the date of the Board Meeting which was Rs. 52.80. The closing market price of the Equity Shares as on the date prior to Board Meeting date was Rs. 54.25 on BSE.
The closing market price of the Equity Shares as on the date of intimation of the date of the Board Meeting for considering the Buy-back to the Stock Exchange, i.e., on Wednesday, March 27, 2019 was Rs. 44.30.
More on Metroglobal Buyback Price Calculation
The Buyback Price of Rs. 56 amounts to a premium of 26.41% to the closing market price of the Equity Shares as on the date of intimation of the date of the Board Meeting on BSE.
The Buy-back Price is about 31.25% and 31.39% of the book value per Equity Share of the Company, which is Rs. 179.19 and Rs. 178.38 as at March 31, 2018 on standalone basis and consolidated basis, respectively.
The EPS of the Company pre Buy-back as on March 31, 2018 on standalone basis and consolidated basis is Rs. 10.90 and Rs. 11.00 respectively which will increase to Rs. 14.44 and Rs. 14.57, respectively, post Buy-back assuming full acceptance of the Buy-back.
The Return on Net worth of the Company pre-Buy-back on standalone basis and consolidated basis as on March 31, 2018 is 6.05% and 6.14% respectively which will increase to 6.55% and 6.65% respectively, post Buy-back assuming full acceptance of the Buy-back.
Source of Funds for the Buyback
Assuming full acceptance, the funds that would be utilized by the Company for the purpose of the Buy-back would be Rs. 22,40,00,000 (Rupees Twenty Two Crores Forty Lakhs only) excluding Transaction Costs.
The Buy-back will be financed out of free reserves, current surplus and / or cash and cash equivalents and / or internal accruals of the Company and / or other permissible sources of funds but not from any borrowed funds.
Metroglobal Limited – Manager to the Buyback
|Vivro Financial Services Private Limited|
Address: 607, 608 Marathon Icon, Opp. Peninsula Corporate Park,
Off Ganpatrao Kadam Marg, Veer Santaji Lane,
Lower Parel, Mumbai – 400 013, Maharashtra, India.
Tel.:+91 22 6666 8040 / 41 / 42 Fax: +91 22 6666 8047
E-mail: [email protected] ; Website: www.vivro.net
Contact Person(s): Mr. Harish Patel / Mr. Vatsal Shah
SEBI Registration Number: INM000010122 Validity: Permanent
Metroglobal Limited – Registrar to the Buyback
|Link Intime India Private Limited|
Address: C 101, 247 Park, L B S Marg, Vikhroli West,
Mumbai – 400 083, Maharashtra, India.
Tel. No.: +91 22 4918 6200 Fax: + 91 22 4918 6195
Email: [email protected];
Contact Person: Mr. Sumeet Deshpande
SEBI Registration Number: INR000004058 Validity: Permanent
Metroglobal Limited Contact Details
|Company Contact Details|
Corporate Identity Number (CIN): L21010MH1992PLC069527
Registered Office: 101, 1st Floor, “Mangal Disha”, Nr. Guru Gangeshwar Temple, 6th Road, Khar (West) Mumbai – 400052, Maharashtra, India.
Phone: +91-22-26051072, +91-22-26051073;
Email: [email protected]; Website: www.metrogloballimited.com;
Corporate Office: 508-509, “SHILP”, C.G. Road, Navrangpura, Ahmedabad – 380 009, Gujarat.
Contact Person: Mr. Nitin S. Shah, Company Secretary, Chief Financial Officer & Compliance Officer
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