TIPS Industries Buyback Review, Offer Details, Price, Dates, Size & more

In this article, they will discuss about TIPS Industries Limited Buyback offer, buyback price, buyback size, TIPS Industries Buyback record date, company financial, buyback necessity and its impact on company.

TIPS Industries Limited Buyback Details

Buyback TypeTender Offer
Opening Date[●]
Closing Date[●]
Buyback Offer AmountRs.18,90,00,000/-
Buyback No. of Shares13,50,000
Face ValueRs.10
Date of Buyback ApprovalFebruary 13, 2020
Date of Public AnnouncementMarch 23, 2020
Buy Back PriceRs.140
Buy Back Premium16.67%
Date of Board MeetingFebruary 13, 2020

TIPS Industries Buyback Opening and Closing Date

The starting and closing date of this buyback is from [●] to [●].

TIPS Industries Buyback Cash Offer

Cash Offer to Buy-back up to 13,50,000 fully paid-up equity shares of the Company of face value of Rs.10 each, representing 9.43% of the total number of equity shares.

TIPS Industries Buyback Record Date

The decided record date is April 03, 2020.

TIPS Industries Buyback Price

At a price of Rs.140 per Equity Share.

TIPS Industries Buyback Size

At a buyback price of Rs.140 payable in cash for an aggregate maximum amount of Rs.18,90,00,000.

TIPS Industries 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.


TIPS Industries 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%20014028000995011.02%
40%400140560001990022.05%
60%600140840002985033.07%
80%8001401120003980044.10%
100%10001401400004975055.12%

Profit is calculated from April 1, 2020 share price i.e. Rs.90.25 per share of TIPS Industries Limited.

According to the above table, if a shareowner applies for 1000 shares of TIPS Industries limited & gets 20% acceptance from the company and the owner with 1000 shares will sell 200 shares @ Rs.140 per share & receive Rs.9950 as profit amount & 11.02% 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.140 & receive a profit of Rs.29850 @ 33.07% profit percentage.


TIPS Industries Limited Buyback Overview

TIPS Industries BuybackTips Industries Limited was initially established as a partnership firm on March 7, 1988 in the name of Tips Cassettes & Record Co. The said partnership firm was converted and incorporated into a joint stock company (as a private limited company) on May 8, 1996 under the provisions of Part IX of the Companies Act, 1956. Subsequently, it became a deemed public limited company with effect from July 1, 1999 pursuant to Section 43A of the Companies Act, 1956.

The Company is in the Media & Entertainment Industry. The Company is in the business of production and distribution of cinematographic films and exploitation of its content on various platform.

This Company is in the business of production and distribution of Cinematographic Films and leveraging its audio content digitally in India and overseas. The Company is also a leading producer of Punjabi films in the country.

TIPS Industries has one of the largest and diversified music libraries with a collection of over 25,000 songs across all genres and major languages. Company’s all songs are available in all digital formats across all major global platforms like iTunes and Google Play as well as top Indian music streaming platforms like Jio-Saavn, Gaana, WYNK and others.


Company Finances – TIPS Industries Limited

The brief audited consolidated financial information of the Company for the last three financial years and limited review financial information for the 9 months ended December 31, 2019 are provided below:

ParticularsFor the period ended December 31, 2019 (audited)12 Months period ended March 31
(Audited)
201920182017
Total Income8960.0320772.374992.856642.00
Total Expenses (excluding Interest, depreciation)7397.1019694.193790.495041.00
Finance Cost49.06219.07663.391024.00
Depreciation and Amortization157.15130.09139.25147.00
Profit before tax1356.72729.02399.02430.00
Provision for tax
(including Deferred Tax)
258.94444.2687.18132.00
Profit /(Loss) after tax1097.78284.76312.54298.00
Equity Share Capital1431.871431.87*1431.871431.87
Reserves6575.305643.055535.875370.00
Networth7976.077050.926938.746797.87
Total Debt (including working capital)158.85846.983575.566424.00

TIPS Industries Limited Buyback Dates

Date of Board Meeting approving the BuybackFebruary 13, 2020
Date of publication of Public Announcement for BuybackMarch 24, 2020
Record Date for determining the Buyback Entitlement and the names of Eligible ShareholdersApril 03, 2020
Buyback Opening date[●]
Buyback Closing date[●]
Last Date of verification of Tender Forms by the Registrar[●]
Last date of intimation regarding acceptance / non-acceptance of Tendered Equity Shares to the BSE Limited by the Registrar[●]
*Last date of Settlement of Bids on the BSE Limited[●]
Last date of return of unaccepted Equity Shares by BSE Limited[●]
*Last date of Extinguishment of Equity Shares[●]

Details of Public Announcement

The Public Announcement dated March 23, 2020 was published on March 24, 2020 in the following newspapers, in accordance with Regulation 7(i) of the Buyback Regulations, within two working days from the date of declaration of results of the Postal Ballot or special resolution i.e. March 21, 2020:

PublicationLanguageEdition
Business StandardEnglishAll editions
Business StandardHindiAll editions
Mumbai LakshadeepMarathiRegional Edition

Necessity of TIPS Industries Limited Buyback

The Buyback is being proposed by the Company to service the equity more efficiently. Additionally, the Company’s management strives to increase equity shareholders value and the Buyback would result in amongst other things:

a) The Buyback is being done to return surplus funds, after taking into account the strategic and operational cash needs of the Company in the short to medium term

b) The Buyback may help in improving earnings per share, return on equity, by reduction in the equity base, thereby leading to long term increase in shareholders’ value;

c) The Buyback gives an option to the equity shareholders, who can either (i) choose to participate and get cash in lieu of Equity Shares to be accepted under the Buyback; or (ii) choose to not participate and enjoy a resultant increase in their percentage shareholding, post the Buyback, without additional investment;

d) The Buyback, which is being implemented through the Tender Offer as prescribed under the Buyback Regulations, would involve minimum reservation of 15% for Small Shareholders and 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 for Small Shareholders would benefit a large number of public shareholders, who would get classified as Small Shareholder.


Impact of TIPS Industries Limited Buyback on the Company

They believe that the Buyback 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.

Consequent to the Buyback and based on the number of shares bought back within each category of shareholders, the shareholding pattern of the Company would undergo a change.

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

Salient financial parameters consequent to the Buyback based on the latest audited financial statement of the Company for the half year ended March 31, 2019 are as under:

Parameters (based on audited standalone financial statements for year ended March 31, 2019)Pre Buy-backPost Buy-back
(Assuming Full Acceptance)
Net worth (Rs in Lakhs)7976.075645.77
Return on Net worth (%)13.76%19.44%
Earnings Per Share Basic (Rs)7.678.46
Book Value per Share (Rs)55.7043.53
Total Debt / Equity Ratio0.020.03

Basis of Calculating TIPS Industries Buyback Price

The Equity Shares of the Company are proposed to be bought back at the Buyback Price, i.e., Rs.2140/- (Rupees One Hundred and Forty Only) per Equity Share.

The Buyback Price of Rs.140/- (Rupees One Hundred and Forty Only) per Equity Share has been arrived at after considering various factors including, but not limited to, the trends in the volume weighted average price and closing price of the Equity Shares on the BSE and NSE. This Buyback Price represents:

The Buyback Price represents

  • Premium of 16.67 % and 17.40 % over the closing price of the Equity Shares on BSE and NSE, respectively, as on February 10, 2020 being the date on which the Company intimated to the Stock Exchanges of the date of the meeting of the Board of Directors wherein the proposal of Buyback was considered.
  • Premium of 24.30 % and 25.33 % over the volume weighted average market price of the Equity Shares on BSE and NSE, respectively, during the two weeks preceding the date of intimation to the Stock Exchanges of the date of the meeting of the Board of Directors wherein the proposal of Buyback was considered.
  • A Premium of 37.05 % and 34.19 % over the volume weighted average market price of the Equity Shares on BSE and NSE, respectively, during the 30 trading days preceding the date of intimation to the Stock Exchanges of the date of the meeting of the Board of Directors wherein the proposal of Buyback was considered.
  • Premium of 41.96 % and 46.95 % over the volume weighted average market price of the Equity Shares on BSE and NSE, respectively, during the 60 trading days preceding the date of intimation to the Stock Exchanges of the date of the meeting of the Board of Directors wherein the proposal of Buyback was considered.

Source of Funds for the Buyback

Assuming full acceptance, the funds that would be utilized by the Company for the purpose of the Buyback would be Rs.18,90,00,000/-, excluding Transaction Costs.

The Buyback would be financed out of free reserves and/or such other sources as may be permitted by law through “Tender Offer” route and as required by the Buyback Regulations and the Companies Act, and on such terms and conditions as the Board may deem fit.

The funds for the Buyback will be sourced from the cash and cash equivalents and/or accumulated internal accruals and no borrowings are made to discharge the Buyback obligations. 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.

The Company shall transfer from its free reserves a sum equal to the nominal value of the equity shares purchased through the Buyback to the Capital Redemption Reserve account and the details of such transfer shall be disclosed in its subsequent audited financial statement.


TIPS Industries Limited – Manager to the Buyback

Inga Ventures Private Limited
1229, Hubtown Solaris, N.S. Phadke Marg,
Opp. Telli Galli, Andheri (East), Mumbai 400069
Tel. No.: +91 022 26816003, Fax: +91 022 26816020;
Contact Person: Kavita Shah;
Email: kavita@ingaventures.com;
Website: www.ingaventures.com;
SEBI Registration No: INM000012698;
Validity Period: Permanent
CIN: U67100MH2018PTC318359

TIPS Industries Limited – Registrar to the Buyback

Link Intime India Private Limited
C-101, 247 Park, L.B.S. Marg, Vikhroli (West)
Mumbai, Maharashtra – 400 083
Tel. No.: +91 22 4918 6200; Fax: +91 22 4918 6195;
Contact person: Sumeet Deshpande;
Email: tips.buyback@linkintime.co.in
Website: www.linkintime.co.in ;
SEBI Registration No: INR000004058;
Validity Period: Permanent
CIN: U67190MH1999PTC118368

TIPS Industries Limited Contact Details

Company Contact Details
TIPS Industries Limited
Registered Office: 601, Durga Chambers, 6th Floor, Linking Road, Khar – West, Mumbai, Maharashtra, 400052; Corporate Identity Number (CIN): L92120MH1996PLC099359; Tel. No.: 022-66431188; Fax: +022-66431189; Email: buyback@tips.in; Website: https://tips.in/;
Contact Person: Bijal R. Patel, Company Secretary & Compliance Officer

 


TIPS Industries Limited Buyback News

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

News 2 – TIPS Industries Ltd – Public Announcement


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