Welspun Enterprises drops as board approves buyback offer

capital market | Mumbai | December 23, 2016 10:43 IST

Welspun Enterprises fell 3.82% to Rs 59.10 at 10:09 IST on BSE after the company announced plans to buyback up to 25% of its share capital at Rs 62 per share.

The announcement was made after market hours yesterday, 22 December 2016.

Meanwhile, the S&P BSE Sensex was down 73.36 points, or 0.28%, to 25,906.24

On the BSE, 24,000 shares were traded on the counter so far as against the average daily volumes of 1.24 lakh shares in the past one quarter. The stock had hit a high of Rs 60.50 and a low of Rs 58.55 so far during the day.

The stock hit a 52-week high of Rs 75.30 on 3 November 2016. The stock hit a 52-week low of Rs 43 on 12 February 2016. The stock had outperformed the market over the past 30 days till 22 December 2016, rising 5.04% compared with the 0.28% fall in the Sensex. The scrip also outperformed the market in past one quarter, falling 4.43% as against Sensex's 9.38% decline.

The small-cap company has equity capital of Rs 174.28 crore. Face value per share is Rs 10.

Welspun Enterprises said that with a view of utilising the company's substantial cash reserves and in order to enhance shareholder value, the board has approved buy back of 25% of the company's share capital. The buyback would be at Rs 62 per share in cash for an aggregate consideration not exceeding Rs 270 crore, Welspun Enterprises said. The promoter group, except the foreign co-promoters holding 2.17%, have indicated their intention to participate in the proposed buyback, the company said.

Welspun Enterprises reported net profit of Rs 2.86 crore in Q2 September 2016 as compared with net loss of Rs 6.18 crore in Q2 September 2015. Net sales rose 16.93% to Rs 33.22 crore in Q2 September 2016 over Q2 September 2015.

Welspun Enterprises' is an operating company in the infrastructure business. The company also has investments in the oil and gas exploration.

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