Star Cement Limited Buyback Review, Offer Details, Price, Dates, Size & more

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

Star Cement Limited Buyback Details

Buyback TypeTender Offer
Opening DateOctober 22, 2019
Closing DateNovember 05, 2019
Buyback Offer AmountRs. 102,00,00,000/-
Buyback No. of Shares68,00,000
Face ValueRs. 1
Date of Buyback ApprovalApril 16, 2019
Date of Public AnnouncementJune 25, 2019
Buy Back PriceRs. 150/-
Buy Back Premium1.62%
Date of Board MeetingJune 21, 2019

Star Cement Buyback Opening and Closing Date

The starting and closing date of this buyback is from October 22, 2019 to November 05, 2019.

Star Cement Buyback Cash Offer

The Cash Offer to Buy-back up to 68,00,000 fully paid-up equity shares of the Company of face value of Rs. 1 each, representing 1.62% of the total number of equity shares.

Star Cement Buyback Record Date

The decided record date is July 05, 2019.

Star Cement Buyback Price

At a price of Rs.150 per Equity Share.

Star Cement Buyback Size

At a buyback price of Rs.150/- payable in cash for an aggregate consideration not exceeding Rs.102,00,00,000.

Star Cement 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.


Star Cement 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%200150300001120011.91%
40%400150600002240023.83%
60%600150900003360035.74%
80%8001501200004480047.66%
100%10001501500005600059.57%

Profit is calculated from 17th Oct 2019 share price i.e. Rs.94 per share of Star Cement Limited.

According to the above table, if a shareowner applies for 1000 shares of Star Cement limited & gets 20% acceptance from the company and the owner with 1000 shares will sell 200 shares @ Rs.150 per share & receive Rs.11200 as profit amount & 11.91 % 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.33600 @ 35.74 % profit percentage.


Star Cement Limited Buyback Overview

Star Cement Limited (“Star Cement” or the “Company”) an Indian company incorporated on December 29, 1945, is a leading global information technology, consulting and business process services company. The Company has over 1,70,000 dedicated employees serving clients across six continents.

The name of the Company was changed from Western India Vegetable Products Limited to Star Cement Products Limited on June 7, 1977, and subsequently to Star Cement Limited on April 28, 1984. The Company has its registered office situated at Doddakannelli, Sarjapur Road, Bengaluru 560 035, India.

Company shifted its registered office from the State of Maharashtra to the State of Karnataka on July 10, 1996. The Equity Shares of the Company were listed in the year 1995 on the NSE (Code: Star Cement) and an application for listing of equity shares was filed with BSE in the year 1946-47 (Code: 507685). The ADRs of the Company were listed on NYSE (Code: WIT) in the year 2000. The ISIN Number of the Company is INE075A01022.


Company Finances – Star Cement Limited

The salient Financial Information of the Company as extracted from the standalone Audited financials of the
Company is given below:

[In Rs. Lakhs]

Particulars12 Months period ended March 31
(Audited)
201920182017
Total Income1,73,488.921,48,759.251,34,558.25
Total Expenses (excluding finance cost, depreciation & amortization)1,45,452.151,25,975.291,25,949.18
Interest
Depreciation and amortization expenses4,648.775,745.454,035.36
Profit before tax28,036.7722,783.958,609.07
Provision for tax
(including Deferred Tax)
2,447.631,706.30606.63
Profit /(Loss) after tax25,589.1421,077.658,002.44
Equity Share Capital4,192.294,192.294,192.14
Other Equity
Networth1,04,487.3483,201.4862,123.83
Total Debt (Excluding working capital loans)15,715.8742,785.6562,183.89

Star Cement Limited Buyback Dates

Date of Board Meeting approving the BuybackJune 21, 2019
Date of publication of Public Announcement for BuybackJune 25, 2019
Record Date for determining the Buyback Entitlement and the names of Eligible ShareholdersJuly 05, 2019
Buyback Opening dateOctober 22, 2019
Buyback Closing dateNovember 05, 2019
Last Date of verification of Tender Forms by the RegistrarNovember 07, 2019
Last date of intimation regarding acceptance / non-acceptance of Tendered Equity Shares to the BSE Limited by the RegistrarNovember 14, 2019
*Last date of Settlement of Bids on the BSE LimitedNovember 15, 2019
Last date of return of unaccepted Equity Shares by BSE LimitedNovember 15, 2019
Last date of Extinguishment of Equity SharesNovember 22, 2019

Details of Public Announcement

The Public Announcement dated June 21, 2019 was published on June 25, 2019 in the following newspapers, in accordance with Regulation 7(i) of the Buyback Regulations, within two working days from the date of passing of the Resolution in the meeting of Board of Directors for the Buyback, on June 21, 2019.

PublicationLanguageEdition
Business StandardEnglishAll editions
Meghalaya TimesEnglishShillong edition
Business StandardHindiAll editions
U Nongsain HimaKhasiShillong edition

Necessity of Star Cement Limited Buyback

The Buyback is being undertaken for the following reasons:

  • The Buyback will help the Company distribute surplus cash to the Equity Shareholders broadly in proportion to their shareholding, thereby, enhancing the overall return to Equity Shareholders;
  • Buyback, which is being implemented through the Tender Offer route as prescribed under the Buyback Regulations, involves a reservation of up to 15% of the Buyback Size for Small Shareholders. The Company believes that this reservation of up to 15% for Small Shareholders would benefit a large number of the Company’s public shareholders, who would be classified as Small Shareholders for the purposes of the Buyback;
  • The Buyback would help in improving financial ratios like earnings per share and return on equity, by reducing the equity base of the Company; and
  • The Buyback gives the Eligible Shareholders the choice to either participate in the Buyback and receive cash in lieu of their Equity Shares which are accepted under the Buyback, or not to participate in the Buyback and get a resultant increase in their percentage shareholding in the Company post the Buyback, without additional investment.

Impact of Star Cement Limited Buyback on the Company

The Company believes that the Buyback is not likely to cause any material impact on the profitability/earnings of the Company except a reduction in the investment income, which the Company could have otherwise earned on the amount distributed towards Buyback. Assuming there is full response to the buyback, the funds deployed by the Buyback would be Rs. 102,00,00,000/- .

The buyback will not in any manner impair the ability of the Company in meeting to pursue growth
opportunities or meet its cash requirements for business operations.

Salient Financial Parameters consequent to the Buyback based on the latest standalone and consolidated audited results as on March 31, 2019 are as under:

Parameters (based on audited standalone financial statements for year ended March 31, 2018)Pre Buy-backPost Buy-back
(Assuming Full Acceptance)
Net worth (Rs in Lakhs)1,04,487.3494,287.34
Return on Net worth (%)24.49%27.14%
Earnings Per Share (Rs)6.106.20
Book Value per Share (Rs)24.9222.86
P/E as per the latest audited standalone financial statementsNSE-0.17

BSE-19.92

NSE-19.69

BSE-19.60

Total Debt / Equity Ratio0.150.17

Basis of Calculating Star Cement Buyback Price

The Equity Shares are proposed to be bought back through Tender Offer at a price of Rs. 150/- per Equity Share.

Buyback Price represents a premium of 37.21% over the volume weighted average market price of the Equity Shares on the NSE For 3  months preceding the date of the intimation of the Board Meeting i.e. June 18, 2019 which was Rs. 109.32 and 20.39% over the volume weighted average market price of the Equity Shares on the NSE for 2 weeks preceding the date of the intimation of the Board Meeting i.e. June 18, 2019 which was Rs. 124.60.

The closing market price of the Equity Shares as on the date of the intimation of the Board Meeting i.e. June 18, 2019, was Rs. 118.15 on NSE and Rs. 117.80 on BSE.

More on Star Cement Buyback Price Calculation

The Return of adjusted net worth of the Company Pre- Buyback as on March 31, 2019 is 24.49% on a
standalone basis, which will increase to 27.14% post Buyback assuming full acceptance of the Buyback,
as calculated at 9.15 above.

The basic adjusted earnings per share of the Company pre buyback as on March 31, 2019 is Rs. 6.10 on a standalone basis, which will increase to Rs. 6.20, post buyback assuming full acceptance.


Source of Funds for the Buyback

Assuming full acceptances, the funds that will be employed by the Company for the purpose of Buyback of 68,00,000 equity shares at a price of Rs. 150/-per equity share would be Rs. 102,00,00,000/-.

The funds for the Buyback will be sourced from cash balances available with the Company and/or liquidation of financial instruments held by the Company. These funds have been generated through internal accruals. 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.


Star Cement Limited – Manager to the Buyback

NARNOLIA FINANCIAL ADVISORS LIMITED
201, 2ND Floor, Marble Arch
236B, A.J.C Bose Road, Kolkata – 700020
Tel No: (033) 4050 1500
Fax: (033) 4050 1549
Email: mgoenka@narnolia.com
Website: www.narnolia.com
Contact Person: Mr. Manav Goenka
SEBI REGN NO: INM000010791

Star Cement Limited – Registrar to the Buyback

MAHESHWARI DATAMATICS PRIVATE LIMITED
23 R. N. Mukherjee Road, 5th Floor
Kolkata -700001
Tel No: (033) 22482248, 22435029
Fax: (033) 22484787
Email: mdpldc@yahoo.com
Website: http://www.mdpl.in
Contact Person: Mr. S. Rajagopal
SEBI REGN NO: INR0000000353

Star Cement Limited Contact Details

Company Contact Details
STAR CEMENT LIMITED
CIN: L26942ML2001PLC006663
Regd. Office: Vill: Lumshnong, P.O.: Khaliehriat, Dist.: East Jaintia Hills, Meghalaya – 793210
Corporate Office: Satyam Towers, Unit No. 9B, 1st Floor, 3 Alipore Road, Kolkata – 700027
Phone No: (033) 24015556 Fax No: (033) 24015556
Website: www.starcement.co.in; E-mail: investors@starcement.co.in:Company Secretary and Compliance Officer :Mr. Debabrata Thakurta

 


Star Cement Limited Buyback News

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

News 2 – Star Cement Ltd – Public Announcement


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