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Pennar Industries announces buyback

V Rishi Kumar Hyderabad | Updated on November 15, 2019 Published on November 15, 2019

Pennar Industries Limited (PIL), a leading value-added engineering products and solutions company based in Hyderabad, has announced buyback of equity shares.

The Board of Directors, at its meeting held on November 12, 2019, approved buyback of the company's fully paid-up equity shares of face value of Rs 5 each from the eligible equity shareholders of the company other than promoters, promoter group and persons who are in control of the company. It has offer price not exceeding Rs 45 per equity share (maximum buyback price), for an aggregate amount not exceeding Rs 40 crore (Maximum buyback size).

This is payable in cash from the open market route through the stock exchange mechanism under the Buyback Regulations and the Companies Act. The maximum buyback size represents 6.14% and 6.16% of aggregate of the company's paid up equity capital and free reserves based on the audited consolidated and standalone financial statements, respectively, of the company as at March 31, 2019. This is in compliance with the maximum permissible limit of 10% of the total paid up equity share capital and free reserves in accordance with Section 68(2) of Companies Act.

The promoters or their associates shall not deal in the shares or other specified securities of the company in the stock exchange or off-market, including inter-se transfer of shares, during the period from the date of Board approval till the closing of the buyback.

The company believes the buy-back will create long term value to shareholders. The buyback is not likely to cause any material impact on the profitability/earnings of the company. The share buyback will reduce the outstanding number of equity shares and consequently improve, over a period of time, earnings per share and key return ratios like return on net worth, return on assets etc. and will help effectively utilise available cash.

Published on November 15, 2019
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