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DCM Shriram Ltd, formely known as DCM Shriram Consolidated Ltd, proposes to buyback its shares from the open market worth up to ₹135 crore.
The Board of Directors of DCM Shriram on Saturday approved the buyback at a price not exceeding ₹90 per equity share of face value ₹2 each. The buyback price is at a premium of 32 per cent over Friday’s closing price of ₹68 on the NSE. The buyback programme is expected to be initiated sometime early next month, sources said.
At the end of December quarter, the promoter and promoter group held a 62.53 per cent stake in the company. DCM Shriram believes that the buyback will help optimise value for the shareholders of the company, it said in a statement.
“The extent to which the company repurchases its shares and the timing of such repurchases will depend upon capital market conditions, prevailing prices and any other corporate and regulatory considerations,” it said.
DCM Shriram reported a net profit of ₹44.33 crore on revenue of ₹1,452 crore for the quarter ended December 2013. The net profits were 27 per cent lower over corresponding quarter last year on account of losses in the company’s sugar business caused by high cane price and declining prices of the sweetener.
The company had recently declared an interim dividend of 40 per cent or 80 paise on par value of ₹2 each.
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