Ajanta Pharma Buyback – What’s in it for Investors?

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The Board of Directors of Ajanta Pharma Limited at its meeting held on November 3, 2020, has approved a proposal of buyback along with the Q2FY21 Results.

Buyback Details

Buy Back Size (In Cr.)

135.97

Number of Shares

735000

Buyback Offer Size

0.84% of Total number of shares

FV (In Rs.)

2

Buyback Price (In Rs.)

1850

Closing on announcement day

1609

Premium

14.9%

Record Date

November 13, 2020

About Ajanta Pharma

Ajanta Pharma Limited (APL) is a multinational company based in India engaged in the development, manufacturing, and marketing of pharmaceutical formulations.

It has a presence in India, the United States, and about 30 other countries in Africa, Asia, the Middle East, and CIS. It was established in 1973.

They serve a wide range of therapeutic segments like Anti-Biotic, Anti-Malarial, Anti-Diabetic, Cardiology, Gynecology, Orthopedics, Pediatric, Respiratory & General Health products.

Q2 FY21 Performance Highlights

  1. On a consolidated basis, the company’s net profit increased 46.29% to Rs 170.22 crore on an 11.38% rise in revenue from operations to Rs 715.91 crore in Q2 September 2020 over Q2 September 2019.
  2. Profit before tax (PBT) jumped 54.27% to Rs 249.24 crore in Q2 September 2020 over Q2 September 2019.
  3. EBITDA rose 54% to Rs 274 crore in Q2 September 2020 over Q2 September 2019. EBITDA is at 38% of revenue from operations.
  4. Total exports in Q2 September 2020 were at Rs 499 crore, a growth of 12% year-on-year. During Q2 September 2020, R&D expenses declined 27.5% to Rs 29 crore (4% of revenue) from Rs 40 crore in Q2 September 2019.
  5. The board has also approved payment of an interim dividend of Rs 9.50 per equity share along with results and Buyback, the record date is on 13 November 2020.
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Financials

(In Cr.)

Sep-20

Jun-20

Mar-20

Dec-19

Revenue

676.51

560.85

560.68

530.55

Total Income

762.75

573.95

614.78

581.72

Interest

-1.35

-1.2

-2.93

-0.84

Tax

-83.31

-42.78

-41.11

-57.45

Net Profit

225.22

115.69

88.51

108.32

Equity

17.54

17.54

17.54

17.54

EPS

25.81

13.26

10.14

12.41

NPM %

33.29

20.63

15.79

20.42

Pre-Buyback shareholding pattern as of October 30, 2020

Minimum Acceptance Ratio

Shares Reserved for Retail

1,10,250 (15% of 735000)

Total Retail Shares

63,58,011

Minimum Acceptance Ratio Retail

1.73%

Non – Retail Shares

6,24,750 (85%)

Minimum acceptance Ratio Non-Retail (Approx.)

0.77%

  1. To be eligible for the buyback the investor should have shares of Ajanta Pharma in Demat or physical form as on record date.
  2. Investment should be less than equal to Rs. 2 Lacs to qualify as a retail Investor.
  3. The final Acceptance ratio for the retail and non-retail category is calculated as the ratio of the number of shares offered in each category divided by the total number of shares tendered in each category.
  4. Prior to this buyback, Ajanta Pharma has done buyback in February 2019 at a price of 1300.

Profit from Buyback based on acceptance ratio

For Retail Investors =2,00,000/1850=108

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Buy 108 Shares at Rs.1573 (Closing of 9th Nov’20)

Acceptance Ratio

33%

50%

75%

100%

Amount Invested in Buyback

169884

169884

169884

169884

No. of Shares buyback

36

54

81

108

BuyBack Profit

9872

14958

22437

29916

Profit

5.81%

8.80%

13.21%

17.61%

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Adroit Financial
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