Fineotex Chemical announce buyback at 30 per cent premium

The shares of mid-sized speciality chemical company, Fineotex Chemical Ltd surged nearly 5 per cent on Tuesday after the company informed that its board has approved buyback plans. The buyback size represents 3 per cent of its paid equity capital.

Fineotex Chemical is a Mumbai-based speciality chemical company. It also has its manufacturing facility in Malaysia with a total capacity of 43,000 MT. The products of the company cater to the needs of the sectors like textiles, agrochemicals, speciality chemicals and healthcare-related chemicals. Its exports contribute 22 per cent of its operations on a standalone basis.

The board of the company on Tuesday announced that it has approved the buyback of equity shares having a face value of Rs 2 from the open market at a maximum price of Rs 40 per equity share. The buyback price is at 30 per cent premium from its Monday closing price.

Generally, the buyback price decides the stock price movement in the market due to probable gains. For example, if its share price is at Rs 30 on BSE and the company is buying back its shares at Rs 40, then these are clear gains for investors, who bought at below the buyback price. To avail buyback offer, investors must have shares in a Demat account before ex-date.

At 10.45 am, the shares of the company were trading higher at Rs 31.50 with gains of 3.6 per cent on BSE.