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Our Bureau

Coimbatore, Aug. 26 Bosch Ltd, formerly known as Motor Industries Company Ltd (MICO), has convened a meeting of the board of directors on September 2 to consider the issue of buyback of a portion of the equity shares of the company.

The decision comes close on the heels of the closure of the buy-back offer of a group company Bosch Chassis Systems India Ltd as a prelude to the delisting of its shares.

Bosch Ltd, in its communication to the BSE, stated that a meeting of the board of directors of the company will be held on September 2 inter-alia, to consider proposal to buyback some part of the equity shares of the company pursuant to Section 77A of the Companies Act, 1956, and if approved, to seek approval of the shareholders for the same through postal ballot as required under The Companies (Passing of Resolution by Postal Ballot) Rules, 2001.

However, it did not indicate what will be the quantum of shares the company is considering to buyback. But the announcement sent the Bosch’s share price racing upwards by about 14 per cent in the NSE today.

As against the previous closing price of Rs 3,635.80, Bosch Ltd’s shares opened strongly at Rs 4,173.90 in the NSE today and went up to a high of Rs 4,300 before settling lower at Rs 4,145.50, netting a gain of 14.02 per cent. The total number of shares traded in the NSE was 38,762.

The company also came out with a buyback proposal earlier. Bosch’s previous buy-back offer was made during June -July period in 2007. But Bosch, which at that time was still called Mico, could only mop up 10 per cent of the 20 per cent offer on stake in spite of the company revising the price upwards to Rs 4,600 from Rs 4,000, after the first offer was announced. At present, Bosch owns 70 per cent of the stake, while 9.7 per cent remains with the public and 20 per cent is with the FIIs.

In the first half of current fiscal (January-June 2008), Bosch Ltd had net sales of Rs 2,426.18 crore and the net profit was Rs 381.44 crore. The EPS was Rs 119. The company’s share capital is Rs 32.05 crore and the promoters Robert Bosch GmbH holds 69.73 per cent of the equity capital.

The Bosch Ltd operates in India in automotive technology, industrial technology and consumer goods and building technology business sectors. The Bosch group operates in India through four companies — Bosch Ltd, Bosch Chassis Systems India Ltd, Bosch Rexroth India Ltd and Robert Bosch Engineering and Business Solutions Ltd. The group also has in the country the largest development centre, outside Germany, for end-to-end engineering and technology solutions.

It was on August 13 that Bosch Electrical Drives India Pvt Ltd, a 51:49 per cent joint venture between Robert Bosch Investment Nederland B.V. and Igarashi Motors India Ltd for production of motors for wiper system and window lift system and motors for engine cooling systems for automotive applications, was commissioned at Chennai.

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