500% rally in five years! Multibagger stock declares buyback of shares at 35% premium from today’s low

Shares of Prime Securities faced heavy selling pressure on Monday, January 27, 2025, as the stock plummeted nearly 17 percent in intra-day trade. The steep decline came after the company announced a buyback of its equity shares through a tender offer at a price of ₹305 per share. While the buyback price reflects a premium of over 12 percent to its previous close of ₹271.35 and 35 percent to its day's low of ₹225.85.

In a regulatory filing, Prime Securities stated that its Board of Directors approved the buyback of up to 6,00,000 fully paid-up equity shares with a face value of ₹5 each. This represents approximately 1.79 percent of the total paid-up equity shares of the company. The aggregate amount for the buyback is ₹18.30 crore. It further added that the buyback size translates to about 16.98 percent of the company's fully paid-up equity share capital and free reserves as of March 31, 2024.

"We wish to inform you that the Board of Directors of the Company, at its Meeting held today, i.e. Monday, January 27, 2025, has considered and approved a Tender Buyback of upto 6,00,000 fully paid-up Equity Shares, of face value of Rs. 5/- each of the Company, representing about 1.79% of the total paid-up Equity Shares of the Company, at a price of Rs. 305/- (Rupees Three Hundred Five only) per Equity Share, payable in cash for an aggregate amount of Rs. 18.30 Cr," the company said in an exchange filing.

The company clarified that the buyback size excludes transaction costs such as brokerage, applicable taxes, buyback taxes, securities transaction tax, GST, stamp duty, and other incidental expenses. The buyback will follow the tender offer route using the stock exchange mechanism, as per SEBI's 2018 regulations. The record date for determining eligible shareholders will be announced later.

Stock Performance

The announcement triggered a sharp sell-off, with the stock plunging to a day's low of ₹225.85, marking a 16.7 percent drop. Despite the dip, Prime Securities has delivered impressive gains over the longer term. The stock has rallied over 51 percent in the past year and provided multibagger returns of more than 500 percent over the last five years.

Currently, the stock is trading over 37 percent below its 52-week high of ₹359.20, achieved in November 2024, but it remains 48 percent higher than its 52-week low of ₹152.25, recorded in March 2024.