Mumbai: Shares of steel maker Monnet Ispat today surged over 15% after its board approved the Rs75 crore buyback offer.
Monnet Ispat board today approved the proposal of buying back about five lakh shares from the market at a price not exceeding Rs300 per share, the company said in a filing to the Bombay Stock Exchange.
The board approval is a statutory requirement after approval from market regulator SEBI. The shares would be repurchased from the BSE and NSE through open market deals.
The buyback price represents a premium of 188.56% and 188.73% on the basis of closing prices on the BSE and NSE respectively on 22 October, the filing added.
Following the approval, the shares of the company surged 15.02% to touch the day’s high of Rs183. It was later quoting at Rs176, up 10.62% in the late afternoon trade on the BSE.
The buyback limit of Rs75 crore represents 7.02% of the paid-up capital and free reserves of the company.
The company plans to utilise the buyback proceeds for setting up an iron ore plant pelletisation plant and increasing its power capacity.
On the National Stock Exchange, the scrip surged 15.76% to a high of Rs184.00. It was later trading at Rs176.05, up 10.76%.
Monnet Ispat today reported a second quarter net profit of Rs65.68 crore, a 60.47% growth over the same period a year ago. It had a net profit of Rs40.93 crore last fiscal.
Total income rose by 52.52% to Rs401.66 crore in the September quarter, from Rs263.35 crore in the same period last fiscal.