Board of multibagger stock approves share buyback: Key details to note
Shyam Century Ferrous Ltd is a small-cap company that operates in the metals and mining sector and has a market capitalization of ₹493.22 crore.
PremiumShyam Century Ferrous Ltd is a small-cap company that operates in the metals and mining sector and has a market capitalization of ₹493.22 crore. The company produces ferro-silicon, one of the main raw materials used to make stainless steel, as well as mild steel, or MS steel. The company operates a factory at Byrnihat, Meghalaya, near Guwahati, with an annual production capacity of around 21,000 MT of ferro-silicon. A captive power generation unit with an installed capacity of about 14 MwH is also present in the plant.
The company has said in a regulatory filing that “the Board of Directors of the Company at its meeting held today, i.e., 11th August, 2022, subject to approval of the shareholders, has unanimously approved a proposal to Buy-back up to 1,00,00,000 (One Crore Only) fully paid-up Equity Shares of Re. 1/- each of the Company (representing 4.50% of the total Equity Capital) from all the Equity shareholders of the Company on a proportionate basis through the “Tender Offer" route using the Stock Exchange Mechanism as prescribed under the Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018 (“the Buy- back Regulations") as amended, at a price of Rs. 28/- (Rupees twenty-eight only) per share payable in cash for an aggregate consideration not exceeding Rs.28,00,00,000/- (Rupees twenty-eight crores only) (excluding company’s transaction cost such as brokerage, buy-back tax, securities transaction tax, GST, stamp duty and other related expenses etc.) (the "buy-back offer Size") in accordance with provisions of the Companies Act, 2013 and the BuyBack Regulations, as amended."
“The maximum shares proposed to be bought back represent 4.50% of the total paid-up equity shares of the Company and the aggregate consideration for proposed buy-back represents 24.56% of the aggregate of the paid-up equity share capital and free reserves as per the Audited financial statements of the Company for the financial year ended 31st March, 2022. Approval of the shareholders will be sought by way of Postal Ballot through e voting," the company has further added in stock exchange filings.
The company has also said in a stock exchange filing that “In terms of Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, this is to further inform you that the Board of Directors at the said meeting inter alia decided to pay Interim Dividend @ 30% (i.e., Re. 0.30 per share) on face value of Re.1/- per share each for the Financial Year 2022-23. The Interim Dividend shall be paid to the eligible shareholders within 30 days of declaration of Interim Dividend. In terms of Regulation 42 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors at the said meeting fixed Wednesday, 24th August, 2022 as ‘Record Date’ for determining the list of eligible shareholders for the interim dividend."
The shares of Shyam Century Ferrous closed on Friday at ₹22.15 apiece, down by 3.06% from the previous close. In the last 3 years, the stock has generated a multibagger return of 689.29% and in the last 5 years, the stock has generated a multibagger return of 154.60%. In the last 1 year, the stock has gained 49.16% and on a YTD basis, the stock has gained 28.41% so far in 2022.
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