Shanthi Gears announces share buyback and dividend

The Board of Directors of Shanthi Gears Limited (SGL) sanctioned the buyback of fully paid-up equity shares for an aggregate amount of Rs. 70,00,00,000. Moreover, they also declared a one-time special interim dividend of Rs. 5 per equity share for FY18-19.

The company will repurchase not more than 50,00,000 equity shares with face value of Re. 1 each, constituting 6.12 per cent of the total paid-up equity share capital of the company. The buyback will happen at a price of Rs. 140 per share through the tender offer route.

The record date to determine the eligibility of shareholders for receiving payment of the special interim dividend has been set to January 7, 2019, Monday. Eligible shareholders will be in receipt of the dividend on or before January 18, 2019.

The pre-buyback shareholding pattern of SGL stands as follows – Promoter and Promoter Group hold 5,73,02,913 shares constituting 70.12 per cent of the share capital, foreign investors hold 29,65,350 shares constituting 3.63 per cent of the share capital, Indian financial institutions hold 30,76,794 shares constituting 3.77 per cent of the share capital, mutual funds hold 15,31,878 shares constituting 1.87 per cent of the share capital, corporate entities hold 6,74,467 shares constituting 0.83 per cent of the share capital and finally, resident individuals & others hold 1,61,64,451 shares constituting 19.78 per cent of the share capital.

Both the special interim dividend and buyback were declared after taking into account the capital requirements for SGL’s growth plans for the near future.

On Wednesday, the shares of SGL opened at Rs. 133.00 per share and hit a high and low of Rs. 136.00 and Rs. 130.75, respectively. At 3:15 pm, the stock was trading at Rs. 131.50, down 1.72 per cent.