Britannia Industries was the subject of a huge block deal of 44,000 shares on BSE in morning trades, setting off a rise in the scrip.
The scrip of the MNC food processing major gained 2.48% to Rs 547 on BSE by 11:07 IST as a result. But this was off the even higher Rs 550 achieved by the scrip earlier. Substantial volumes of 56,757 Britaniia Industries shares were registered on BSE by 11:07 IST.
The block deal of 44,000 shares was placed early morning at Rs 550 per share. But there's no confirmation from the market as to who the entities involved in the deal were. Some are conjecturing that it is an inter-scheme transfer, while others feel that BIL's management may have undertaken the purchase under the buy-back programme.
The company had conducted an earlier big buy of 81,974 shares on BSE on 7 May 2003. Market buzz has it that Unit Trust of India has been selling in BIL and IL&FS may have bought on behalf of the company's buy-back programme. As on 31 March 2003, BIL's promoters held 47% stake in the company, while FIIs, local institutions and the public held 1.02%, 27.3% and 21.97% respectively.
BIL had set a maximum buy-back price of Rs 650 per share of Rs 10, a premium of 19% to the current price. The company has set an outlay of up to Rs 92 crore for the buy-back programme, which opened on BSE on 5 September 2002. The buy-back programme ends on 5 August 2003.
Up to 31 December 2002, a total of 928,958 equity shares have been extinguished by BIL. Accordingly, the number of paid-up equity shares has reduced to 25,921,492 from 26,850,450. The maximum that the company proposes to buy back this time is 25 lakh shares.
In its earlier buy-back programme, the company had mopped up 10 lakh shares at Rs 533 a share, which saw a net outflow of Rs 54 crore. With the buy-back, the combined stake of promoters, Danone Groupe, France and Nusli Wadia went up to 46.96% and the non-promoter's shareholding dropped to 53.04% as against 54.66% held previously.
BIL is the market leader in the Indian biscuits industry with close to 60% market share. It mainly caters to the premium segment. The biscuits business is the revenue driver for the company. BIL has also diversified into dairy and bakery products like butter, cheese and ghee. It continuously expands its product portfolio to achieve its vision of converting every third Indian into its consumer. However, the company has dropped its plans to enter the mineral water segment.
BIL has decided to focus on seven core brands in the biscuits and bakery category. The brands included Good Day, Tiger, 50-50, Snax, and the Cream Treat brands, among others.
For the third quarter ended 31 December 2002, BIL recorded a 11% rise in net profit to Rs 25.10 crore on a 5% drop in net sales to Rs 332.10 crore (Rs 3.32 billion).
BSE code: 500825
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