The purchase of Piramal Enterprises shares will begin on August 31st

Piramal Enterprises stock repurchase begins August 31st and ends September 6th. The company’s board had previously agreed to a share buyback worth up to Rs.1,750 crore in a public offering. The company will repurchase up to 1.4 crore shares at Rs.1,250 each, a premium of more than 16% to the market price at the time of the announcement.

This is also the company’s first share buyback since its IPO. The Supervisory Board has set August 25 as the key date for determining the dividend entitlement of the shareholders. Shareholders who hold shares in the company at the time the entitlement to the dividend is determined are entitled to the redemption.

The amount of the share repurchase represents 5.87% of the total paid-up share capital of the Company’s founder and the group of founders have expressed their intention not to participate in the repurchase.

At the end of June, the promoter and the companies of the promoter group held 43.5% of the company’s shares. The retail rights ratio is approximately 7 shares for every 47 shares held as of the record date and 1 capital share for every 19 shares held for all other general class shareholders.

According to analysts, the expected retail adoption rate is around 30-35%.

In a share buyback, a company repurchases its stock from its shareholders which is considered a tax-efficient way to return money to investors. A share buyback reduces the number of shares available on the market and thus increases the real value of the shares. shares of the company rose 4.32% to Rs 1,105.9 on the NSE on Monday.

In the last quarter, the company reported a fall of more than 90%  in its consolidated net profit to Rs.509 crore, while its consolidated operating profit rose by 34% to Rs.2,899 crore. Total assets under management (AUM) was Rs 63,938 crore; Lending to retail clients grew to 55% of assets under management, compared to 34% in the same period last year.

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