Kaveri Seed Company plans to buy back over 29.62 lakh shares at ₹675 a share.
The company will spend ₹200 crore in buying back about 4.29 per cent of the total paid-up capital of the company from the market, it said in a statement on Monday. At Monday’s closing price of ₹546, the buyback offer is at a premium of about 23 per cent.
As of last fiscal, the company had reserves of ₹893 crore.
The promoters hold 54.7 per cent stake in the company, while the remaining is held by the public. The promoters and promoter group companies have also expressed interest in participating in the buyback offer. The buyback will be managed by Karvy Investor Services.
Shares of the company were down 3 per cent at ₹545.50 on Monday. The Telangana headquartered company sells genetically enhanced seeds. It has strong in-house R&D programmes for crops includeing maize, cotton, sunflower, bajra, sorghum, rice and several vegetables.
Formally incorporated in 1986, Kaveri Seeds is one of the fastest growing seed companies in India with a wide network of 15,000 distributors and dealers spread across the country. It has a superlative product line based on the neo-technology of hybridisation.
The company reported 41 per cent fall in net profit at ₹7 crore (₹11 crore) while revenue dipped 2 per cent to ₹68 crore (₹70 crore), largely due to fall in demand for cotton seeds and price control imposed on hybrid cotton by the government. Sale of maize seed was impacted by lower acreages in Bihar and coastal Andhra Pradesh.