Axita Cotton is a small cap textile company that recorded a market cap of ₹559.02 Cr during today's closing session. The stock ended its trading session with a downside gap of over 3% after the Board of Directors of the company declares record date buyback of shares.
Up to 9 lakh fully paid-up equity shares, each with a face value of 1, representing 0.46% of the total paid-up equity share capital of the company, are being proposed to be buyback by the company at a price of Rs. 56 per equity share, payable in cash for an amount up to ₹5.04 Cr. This represents 9.63% of the total fully paid-up equity share capital and free reserves as per the company’s FY23 earnings statement.
In order to determine the eligibility of the shareholders for the purpose of share buyback, the Board of Directors of Axita Cotton said today in a stock exchange filing today that “In compliance with Regulation 42(2) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Regulation 9(i) of the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 2018, the Company has fixed, Friday, June 02, 2023 as the record date for the purpose of determining the entitlement and the names of Equity Shareholders who would be eligible to participate in the buyback.”
Commenting on whether one should participate in the buyback proposal, A R Ramachandran, Co-founder & Trainer-Tips2trades said “Considering the stock price has come down sharply over the past few days, it will be a good opportunity for investors to participate in the buyback offer proposed by Axita Cotton as a strong uptrend over the longer term looks difficult considering a below average FY23 financial performance. Next support will be at 22.55 on the Daily charts."
The company has reported a total income of Rs.128.66 crores during the quarter ended March 31, 2023 as compared to Rs.291.58 crores during the quarter ended March 31, 2022. During Q4FY23, the company's net profit stood at ₹5.59 Cr down by 11.43% YoY from ₹6.31 Cr in Q4FY22. During the quarter under review, its EPS reached ₹0.28 compared to ₹0.32 in the corresponding quarter of FY22, down by 12.50% YoY.
The shares of Axita Cotton closed today on the BSE at ₹28.44 apiece up by 3.38% from the previous close of ₹27.51. The stock touched a 52-week-high of ₹83.00 on (28/04/2023) and a 52-week-low of ₹15.87 on (13/06/2022). During Q4FY23, the company reported promoters shareholding of 69.65%, FIIs stake of 12.45% and public stake of 17.90%. FII/FPI raised their holdings from 11.63% in the December 2022 quarter to 12.45% in the March 2023 quarter, and institutional investors raised holdings from 11.63% in the Q3FY23 to 12.45% in the Q4FY23, according to Trendlyne data. Promoters' stake in Axita Cotton remained unchanged at 69.65% in the March 2023 quarter.
