Shervani Industrial Syndicate Buyback – Review, Offer Details, Price, Dates & more

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

Shervani Industrial Syndicate Buyback Details

Buyback TypeTender Offer
Buyback Opening DateMay 09, 2019
Buyback Closing DateMay 22, 2019
Buyback Offer AmountRs. 20,75,00,000/-
Buyback No. of Shares4,15,000
Face ValueRs. 10/-
Date of Buyback ApprovalJanuary 30, 2019
Date of Public AnnouncementMarch 15, 2019
Buy Back PriceRs. 500/-
Buy Back Premium

Shervani Industrial Syndicate Buyback Opening and Closing Date

The starting and closing date of this buyback is from May 09, 2019 to May 22, 2019.

Shervani Industrial Syndicate Buyback Cash Offer

The Cash Offer to Buy-back up to 4,15,000 (Four Lakhs Fifteen Thousand) fully paid-up equity shares of the Company of face value of Rs. 10 each.

Shervani Industrial Syndicate Buyback Record Date

The decided record date is Friday, March 29, 2019.

Shervani Industrial Syndicate Buyback Price

At a price of  Rs. 500/- (Rupees Five Hundred Only) per Equity Share.

Shervani Industrial Syndicate Buyback Size

The Buyback is for an aggregate amount not exceeding Rs. 20,75,00,000/ (Rupees Twenty Crores Seventy-Five Lakhs only).


Shervani Industrial Syndicate 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 Shervani Industrial Syndicate Limited.

According to the above table, if a share owner applies for 1000 shares of Shervani Industrial Syndicate 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.


Shervani Industrial Syndicate Limited Buyback Overview

The company was incorporated on 25th February 1948 as ‘Great Eastern Electroplaters Limited’ with the objective of carrying out the business of colour and chromium plating of consumer items under the Companies Act 1913. The name of the company was subsequently changed to “Geep Flashlight Industries Limited” to identify with the new business activity i.e. manufacture and sale of flashlight cases (torches).

Subsequently, the company expanded its product stream to include manufacture and sale of miniature lamps, dry cell batteries as well as trading of other consumer items. The name of the company was, on 9th August, 1979, changed to ‘Geep Industrial Syndicate Limited’.

Thereafter the Company sold the “GEEP” brand, design, art work, distribution network alongwith marketing assets to ‘Gillette Group’ and consequently, the name of the Company was again changed to ‘Shervani Industrial Syndicate Limited’ (SISL). Subsequently, the company diversified and changed its main business into Real Estate.


Company Finances – Shervani Industrial Syndicate Limited

The salient features of the financial information of the Company as extracted from the standalone audited financial statements of the Company for the last three financial years ended March 31, 2018, March 31, 2017 and March 31, 2016 and Unaudited Limited Review Financial Results for the six months period ended September 30, 2018 are set out below:

[In Rs. Lakhs]

Key  FinancialsLimited Review
for the 6
months period
ended
30.09.2018
(Unaudited
Figures)
Year ended  31
March, 2018
(Audited figures)
Year ended  31 March, 2017
(Audited figures)
Year ended 31 March, 2016
(Audited figures)
Revenue from Operations1002.0011303.114175.652837.19
Other Income204.00150.04166.55106.58
Total Revenue1206.0011453.154342.202943.77
Expenses
Construction /Development
Expenses-Real Estate
1482.001954.00961.991101.48
Changes  in  Inventories of Finished
goods, Stock in Trade and Work in
Progress
(994.00)4286.021830.401299.30
Employee Benefit expense69.00195.2295.5092.80
Finance Cost11.009.0819.8850.77
Depreciation and Amortization28.0040.0029.1929.41
Selling Expense13
Other expenses135.00333.65255.75338.54
Total Expenses744.006817.773192.722912.30
Profit/ ( Loss ) before Exceptional
Items& Tax Expenses
462.004635.381149.4931.48
Exceptional Items00352.8478.61
Profit/(Loss) before Tax462.004635.381502.33110.09
Tax Expenses ( including Deferred tax)0906.54(1.36)13.35
Net Profit/(Loss)  for the period462.003728.841503.6996.74
Other Comprehensive  income / (Loss)
(net of tax)
(67.00)43.4912.920
Total Comprehensive Income /(Loss)
(after Tax)
395.003772.331516.6196.74
Paid Up Share Capital313.60313.60328.03328.03
Reserve and Surplus ( excluding
Capital Reserve and Revaluation
Reserve)
55338161.564917.123413.43
Net Worth5846.608475.165245.153741.46
Total  debt781.00682.46100.54791.74

Shervani Industrial Syndicate Limited Buyback Dates

Date of the Board meeting held to approve the proposal for Buy-back of Equity Shares30.01.2019, Wednesday
Date of publication of Public Announcement for the Buy-back18.03.2019, Monday
Record Date for determining the Buy-back Entitlement and the Eligible Shareholders29.03.2019, Friday
Buy-back opens on / Buy-back Opening Date09.05.2019, Thursday
Buy-back closes on / Buy-back Closing Date22.05.2019, Wednesday
Last date of verification by Registrar to Buy-back29.05.2019, Wednesday
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-back30.05.2019, Thursday
Last date of settlement of bids on the Stock Exchange31.05.2019, Friday
Last date of return of unaccepted demat shares by Stock Exchange to Seller Member / Broker31.05.2019, Friday
Last date of extinguishment of Equity Shares bought back07.06.2019, Friday


Necessity of Shervani Industrial Syndicate Limited Buyback

After considering several factors and benefits, the Board decided to recommend Buyback of equity shares from the shareholders of the Company, inter-alia, for the following reasons:

  • The Buyback will help the Company to return surplus cash to its shareholders holding equity shares broadly in proportion to their shareholding, thereby, enhancing the overall return to shareholders;
  • The Buyback would help in improving return on equity by a reduction in the share capital base and increasing shareholder value in the longer term;
  • The Buyback gives an option to the shareholders holding equity shares of the Company, who can choose to participate and get cash in lieu of shares to be accepted under the Buyback offer or they may choose not to participate and be benefitted of a resultant increase in their percentage shareholding, post the Buyback offer, without additional investment;
  • Optimizes the capital structure;
  • Mitigating the Short Term Market Volatility.

Impact of Shervani Industrial Syndicate Limited Buyback on the Company

We believe that the Buyback is not likely to cause any material impact on the profitability or 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 response to the Buyback is to the extent of 100% (full acceptance) from all the Eligible Shareholders up to their entitlement, the aggregate shareholding of the Promoter and Promoter Group Companies after the completion of the Buyback shall increase to 64.18% of the post-Buyback total paid-up equity share capital of the Company from 63.00% of the pre-Buyback total paid-up equity share capital of the Company, and the aggregate shareholding of the public in the Company shall decrease to 35.82% of the post-Buyback total paid-up equity share capital of the Company from 37% of the pre-Buyback total paid-up equity share capital of the Company.

The debt-equity ratio after the completion of the Buyback will be within the permissible limit of 2:1 prescribed by the
Companies Act, even if the response to the Buyback is to the extent of 100% (full acceptance).

Salient financial parameters pursuant to the Buyback based on the Standalone and Consolidated audited financial statements of the Company for the year ended March 31, 2018, are set out below:

ConsolidatedStandalone
ParametersPre Buy-
back
Post Buy-
back
Pre Buy-
back
Post Buy-
back
Net Worth (Rs. in Lakhs)8475.168323.366400.176248.36
Return on Net Worth (%)44.00%45.23%58.26%60.26%
Earnings Per Share (EPS) (Basic) (in Rs.)118.90120.06138.05139.39
Book Value per share (in Rs.)271.99267.12236.95231.33
Price / Earnings Multiple5.245.194.524.47
Total Debt / Equity Ratio0.0810.0820.1060.109

Basis of Calculating Shervani Industrial Syndicate Buyback Price

The Buyback Offer Price has been arrived at after considering various factors including, but not limited to the trends in the volume weighted average prices and closing price of the Shares on the BSE where the shares of the Company are listed, the net worth of the Company, price earnings ratio, impact on other financial parameters and the possible impact of Buyback on the earnings per share.

More on Shervani Industrial Syndicate Buyback Price Calculation

The Board of Directors approved the Buyback Offer Price after considering various factors such as book value per share, earnings per share, price earning capitalization value, trading and market price of shares at BSE etc.

Pre and post Buyback calculations are based on audited standalone and consolidated financials respectively of the Company as on March 31, 2018.

The post Buyback numbers are calculated by reducing the net worth by the proposed Buyback amount (assuming full acceptance) without factoring in any impact on the statement of profit and loss and reducing the no. of equity shares of the Company to the extent of 4,15,000 equity shares proposed to be bought back by the Company.

Net worth excludes revaluation reserves.


Source of Funds for the Buyback

The funds for the implementation of the Buyback will be sourced out of the free reserves of the Company and/or such other sources as may be permitted by the Buyback Regulations or the Companies Act.

The Company shall transfer from its free reserves, a sum equal to the nominal value of the Shares bought back through the Buyback to the capital redemption reserve account, and the details of such transfer shall be disclosed in its balance sheet.

The funds borrowed, if any, from banks and financial institutions will not be used for the Buyback.


Shervani Industrial Syndicate Limited – Manager to the Buyback

VC CORPORATE ADVISORS PRIVATE LIMITED
CIN:U67120WB2005PTC106051
SEBI REGN NO: INM000011096
Validity period: Permanent Registration
(Contact Person: Mr. Anup Kumar Sharma)
31 Ganesh Chandra Avenue, 2nd Floor,
Suite No –2C, Kolkata-700 013
Phone No : (033) 2225-3940 / 3941
Fax : (033) 2225-3941
Email: [email protected]

Shervani Industrial Syndicate Limited – Registrar to the Buyback

LINK INTIME INDIA PRIVATE LIMITED
CIN: U67190MH1999PTC118368
SEBI REGN NO:INR000004058
Validity period: Permanent Registration
(Contact Person: Mr. Sumeet Deshpande)
C-101, 247 Park, 1st Floor, L.B.S. Marg Vikhroli
(West), Mumbai -400 083
Phone No: +91 22 49186200
Fax : +91 22 49186195
Email-Id: [email protected]

Shervani Industrial Syndicate Limited Contact Details

Company Contact Details
SHERVANI INDUSTRIAL SYNDICATE LIMITED
CIN: L45202UP1948PLC001891
Registered Office: Shervani Nagar, Sulem Sarai, Harwara, Prayagraj (Allahabad)- 211015
Tel no: 91- 7311128115; Fax: 91- 532 2436928;
Email: [email protected]; Website: www.shervaniind.com
Company Secretary and Compliance Officer: Mr. S K Shukla

 


Shervani Industrial Syndicate Limited Buyback News

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


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