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Oil India Limited Buyback – Review, Offer Details, Price, Dates & more

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

Oil India Limited Buyback Details

Buyback TypeTender Offer
Buyback Opening DateFebruary 15, 2019
Buyback Closing DateMarch 1, 2019
Buyback Offer AmountRs. 10,85,72,24,155/-
Buyback No. of Shares5,04,98,717
Face ValueRs. 10/-
Date of Buyback ApprovalNovember 19, 2018
Date of Public AnnouncementNovember 20, 2018
Buy Back Price Rs. 215/-
Buy Back Premium8.07%

Oil India Buyback Opening and Closing Date

The starting and closing dates of this buyback are from February 15, 2019, to March 1, 2019.

Oil India Buyback Cash Offer

The Cash Offer to Buy-back up to 5,04,98,717 (Five crores four lakhs ninety-eight thousand seven hundred seventeen only) fully paid-up equity shares of the Company of face value of Rs. 10 each.

Oil India Buyback Record Date

The decided record date is Monday, December 3, 2018.

Oil India Buyback Price

At a price of Rs. 215/- (Rupees Two hundred fifteen only) per Equity Share.

Oil India Buyback Size

The Buyback is for an aggregate amount not exceeding Rs. 10,85,72,24,155 (Rupees Ten thousand eighty-five crores seventy-two lakhs twenty-four thousand one hundred fifty-five only).


Oil India 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%
40%
60%
80%
100%

Profit is calculated from 12th May 2019 share price i.e. Rs.54.15 per share of Oil India Limited.

According to the above table, if a share owner applies for 1000 shares of Oil India 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.


Oil India Limited Buyback Overview

The Company is an integrated oil and gas company which has extensive in-house capabilities and expertise in the domain of oil and gas exploration and production. The Company’s major oil and gas production is from its operational area of Upper Assam and Arunachal Pradesh. A small part of the Company’s gas production is from Rajasthan also.

During the year 2017-18, crude oil production and natural gas production was 3.394 MMT and 2,905 MMSCM (inclusive of 23 MMSCM as Company’s share from Dirok JV which started production in August, 2017).

Additionally, oil production also comes from the Company’s equity investment in USA, Russia and Venezuela. During the year 2017-18, 2.247 MMTOE of production came from overseas assets of the Company with major portion contributed by Vankor and TAAS fields in Russia.

The Company has also initiated steps to enter CGD business. The Company in Consortium with HPCL (Equity ratio 50% each) has been authorized by Petroleum and Natural Gas Regulatory Board (PNGRB) to develop CGD network in Ambala-Kurukshetra and Kolhapur Districts under 8th round of CGD bidding in February-March, 2018. The project is in initial phase of implementation.

In September, 2018, the Consortium of Assam Gas Company Limited (AGCL), the Company and GAIL (Equity ratio of 48%:26%:26%) has been authorized by PNGRB to develop CGD network in Kamrup-Kamrup Metropolitan Districts and Cachar, Hailakandi and Karimganj Districts under the 9th round.

The projects involve laying, building, operating or expanding city or local natural gas distribution network for supplying piped natural gas for transport (CNG), Domestic, commercial and industrial customers.

Besides CGD business, the Company together with ONGC, IOCL, GAIL and NRL with equal equity contribution has formed a JV Company, named “Indradhanush Gas Grid Limited” which will construct Gas Grid infra-structure to connect eight north-eastern states of Assam, Arunachal Pradesh, Meghalaya, Manipur, Mizoram, Nagaland, Tripura and Sikkim to the national gas grid through Barauni-Guwahati gas pipeline being laid by GAIL.

The construction of approx. length of 1,450 km pipeline is likely to be completed within four years’ time.


Company Finances – Oil India Limited

The salient financial information of the Company, as per Ind-AS and as extracted from the audited standalone results for the last three financial years viz. 2018, 2017 and 2016 and the unaudited financial results for the six months ended September 30, 2018, is detailed below:

(Rs. in crore)

Key FinancialsFor the six months
ended
September 30, 2018
(Limited Review)
For the year
ended March 31,
2018
(Audited)
For the year
ended March
31, 2017
(Audited)
For the year
ended March
31, 2016
(Audited)
Total Expenses4,251.026,745.156,405.586,176.63
Interest238.10415.68396.71384.00
Depreciation702.821,270.011,090.73942.30
Exceptional Items: Expense /
(Income)
1,151.73215.13
Profit Before Tax2,356.703,709.802,146.323,440.57
Provisions for Tax (including
Deferred Tax)
791.471,041.87597.641,138.90
Profit/ (Loss) After Tax1,565.232,667.931,548.682,301.67
Paid-up Equity Share Capital1,134.90756.60801.51601.14
Reserve & Surplus*21,398.8720,957.8521,845.0721,699.37
Net worth*22,533.7721,714.4522,646.5822,300.51
Total Debt, excluding working
capital loans
10,029.599,004.258,947.539,132.84

Oil India Limited Buyback Dates

Date of the Board meeting held to approve the proposal for Buy-back of Equity SharesMonday, November 19, 2018
Date of publication of Public Announcement for the Buy-backWednesday, November 21, 2018
Record Date for determining the Buy-back Entitlement and the Eligible ShareholdersMonday, December 3, 2018
Buy-back opens on / Buy-back Opening DateFriday, February 15, 2019
Buy-back closes on / Buy-back Closing DateFriday, March 1, 2019
Last date of verification by Registrar to Buy-backTuesday, March 5, 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-backMonday, March 11, 2019
Last date of settlement of bids on the Stock ExchangeWednesday, March 13, 2019
Last date of return of unaccepted demat shares by Stock Exchange to Seller Member / BrokerWednesday, March 13, 2019
Last date of extinguishment of Equity Shares bought backWednesday, March 20, 2019

Necessity of Oil India Limited Buyback

The Board of Directors of the Company is of the view that the proposed Buyback will help the Company to achieve the following long term benefits:

  • Optimize the capital structure; and
  • Improve key financial ratios of the Company.

The Buyback would lead to reduction in outstanding shares, improvement in earning per share and enhanced return on invested capital.


Impact of Oil India Limited Buyback on the Company

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.

The debt-equity ratio post Buyback will be compliant with the permissible limit of 2:1 prescribed under Section 68 of the Companies Act, 2013, even if the response to the Buyback is to the extent of 100% (full acceptance) of the Buyback Offer Size.

Salient financial parameters consequent to the Buyback based on the standalone audited financial statements as on March 31, 2018 of the Company are as under:

ParametersStandaloneConsolidated
Pre-BuybackPost- BuybackPre-
Buyback
Post- Buyback
Net worth (Rs in crore)21,714.4520,628.7321,686.8220,601.10
Return on Networth (%)12.2912.9312.6113.27
Earnings Per Share (Rs) (of Rs 10 each)23.3224.4023.9025.00
Book Value per Share (Rs)287.00292.15286.64291.76
P/E ratio as per the latest audited
financial results
9.288.879.058.65
Total Debt/ Equity Ratio0.410.440.570.60

Basis of Calculating Oil India Buyback Price

The Buyback price of Rs. 215 (Rupees Two Hundred and Fifteen only) per Equity Share has been arrived at after considering various factors such as the average closing prices of the Equity Shares of the Company on 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.

More on Oil India Buyback Price Calculation

The Buyback Offer Price of Rs. 215 (Rupees Two Hundred and Fifteen only) per Equity Share represents

  • Premium of 8.18% on BSE and 8.16% on NSE over the volume weighted average price of the equity Shares on BSE and NSE respectively for 2 weeks prior to Monday, November 12, 2018 (the date of intimation to the BSE and NSE for the Board Meeting to consider the proposal of the Buyback) and
  • Premium of 8.07% on BSE and 8.01% on NSE over the closing market price of the Equity Shares on BSE and NSE as on the date of the intimation to BSE and NSE as on Monday, November 12, 2018 (the date of the intimation to BSE and NSE for the Board Meeting to consider the proposal of the Buyback).

The closing price of the Equity Shares on Monday, November 19, 2018, being the date of meeting of the Board of Directors approving the Buyback, was Rs. 201.05 and Rs. 200.70 on BSE and NSE, respectively.


Source of Funds for the Buyback

The Buyback shall be made out of the free reserves of the Company as at March 31, 2018 (the last audited 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.

The 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.


Oil India Limited – Manager to the Buyback

SBI CAPITAL MARKETS LIMITED
202, Maker Tower E, Cuffe Parade
Mumbai 400 005
Contact person: Mr. Janardhan Wagle/ Mr. Aditya Deshpande
Tel: +91 (22) 2217 8300
Fax: +91 (22) 2218 8322
Email: [email protected]
Website: www.sbicaps.com
SEBI Registration Number: INM000003531
Validity Period: Permanent Registration
CIN: U99999MH1986PLC040298

Oil India Limited – Registrar to the Buyback

KARVY FINTECH PRIVATE LIMITED
(Formerly KCPL Advisory Services Private Limited)
Karvy Selenium Tower B, Plot No. 31 & 32,
Financial District, Nanakramguda, Serilingampally,
Hyderabad 500 032, Rangareddi, Telangana, India
Contact Person: Mr. Murali Krishna M
Tel: +91 (40) 6716 2222
Fax: +91 (40) 2343 1551
E-mail: [email protected]
Investor Grievance Email: [email protected]
Website: www.karvyfintech.com
SEBI Registration Number: INR000000221
Validity Period: Permanent Registration
CIN: U67200TG2017PTC117649

Oil India Limited Contact Details

Company Contact Details
Oil India Limited
Registered Office: Duliajan, Distt. Dibrugarh, Assam – 786 602, India
Corporate Office: Plot No. 19, Sector 16A, Noida – 201 301, Uttar Pradesh, India
Corporate Identification Number: L11101AS1959GOI001148
Contact Person: Shri S. K. Senapati, Company Secretary and Compliance Officer
Tel: +91 (120) 241 9000 | Fax: +91 (120) 248 8310 | Email: [email protected] | Website: www.oil-india.com

 


Oil India Limited Buyback News

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


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