Kaveri Seed Buyback Offer: Buyback price range, premium, should you buy this stock?—Anil Singhvi, Sandeep Jain EXPLAIN

Kaveri Seed Company Limited recently announced buyback of its shares, informed Zee Business Managing Editor Anil Singhvi. In order to understand this buyback offer and expected price range at which the company would buy its shares, Zee Business research team analysed all possible factors and came at a conclusion that the company may offer buyback price range of Rs 710 to 760.  

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" This is Rs 50 range that the company would buy back its shares. To be precise, it may offer a price of Rs 750. This is not the first time that the company has come up with buyback offers, but its has announced similar offer consecutively for three years in 2017, 2018 and 2019.  This is the fourth buyback offer by the company. Past trends of the company suggests that it floats a buyback of 4.35 to 4.44 per cent of its total outstanding shares.  As far as premium is concerned, the company offers buyback at a price of 23 to 33 per cent from the closing price of the company on the day of the announcement of buy back. Taking previous records of the company, it appears that Kaveri seed will offer a buyback of around 27 lakh shares," said Varun Dubey, Senior Research Analyst at Zee Business. 

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Talking about this share, market expert Sandeep Jain said it is a very volatile share. " Those who have bought the shares should hold them, while those planning to buy should not rush. They should wait for the buyback price announcement by the company and act accordingly, given the present sentiments in mid cap and small cap shares. There will be opportunity in this scrip again. So, investors should wait fro the right time,"  he said.