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Quick Heal Buyback
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The Board of Directors of Quick Heal approved a share buyback for its investors on Mar 5, 2019. The details of the buyback include:

Ex Date: 25 April 2019

Buyback price: Rs. 275

Premium/Discount as per closing price on 5 Mar’19:  +22.76% on Rs. 224

Buyback of shares: 63,63,636 equity shares (aggregating up to 9.02% of fully paid-up equity share capital of the Company,)

Amount of Buyback: Rs. 175 crores (which is 23.87% of the aggregate of the fully paid-up equity share capital and free reserves of the Company as on December 31, 2018)

*Shareholding Pattern: Promoters have 72.33% holding i.e. 5,10,30,720 equity shares and Indian Public, Corporates and others’ shareholding in the company is 18.57% i.e. 1.30,99,004 shares as on 1 March 2019.

*Shareholding with up to 20,000 shares (according to Nominal Value): 53,61,593 shares as on 31 December 2018.

The promoters had the option to participate in the buyback and have communicated their intention to participate in the Buyback and offer up to 46,02,772 equity shares.

The maximum no. of shares held to qualify as a retail shareholder are 727 shares. Reserved shares for retail investors are 9,54,545 (i.e. 15% of 63,63,636). Assuming 100% of these shareholders tender their shares, the acceptance ratio is expected to be around 17.8%.

Following are the dividends as provided by the company in the past 3 years:

Corporate Action

Price (Rs.)

Ex-Date

Final Dividend

3

31 Jul 2018

Dividend

2.5

3 Aug 2017

Dividend

2.5

21 Jul 2016

 

The share buyback plan is well within the limit of cash reserves in the company’s books, which is currently a little more than Rs 500 crore. The promoters had the option to participate in the buyback and have communicated their intention to participate in the buyback and offer up to 46,02,772 equity shares.

The company has nil debt. Following factors should be kept in mind before participating in the buyback:

  1. If FY19 results are declared before the completion of buyback, it will influence the returns during the holding period.
  2. The stock is not a part of F&O segment, keeping it under pressure post the buyback.
  3. There will be considerate volatility in the market due to upcoming elections and Trump’s policy decisions in US.

*Source: Company Annual Report 2018

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