Natco Pharma gains as board OKs Rs 210-cr share buyback

Natco Pharma rose 1.12% to Rs 572.50 after the pharma company announced that its board has approved a share buyback of upto Rs 210 crore at a price not exceeding Rs 700 per equity share through open market route.

The maximum buyback price of Rs 700 per equity share represents a 23.64% premium to Monday's closing price of Rs 566.15 on the BSE.

The indicative maximum number of equity shares bought back would be 30 lakh shares which is 1.64% of the total number of paid-up equity shares of the company.

If the equity shares are bought back at a price below the maximum buyback price, the actual number of equity shares bought back could exceed the indicative maximum buyback shares (assuming full deployment of maximum buyback size) but will always be subject to the maximum buyback size.

Further, the buyback shall not exceed the maximum buyback size, which represents 5.13% and 5.04% of the aggregate of the total paid-up capital and free reserves of the company based on the audited standalone financial statements and audited consolidated financial statements of the company as at 31 March 2022, respectively.

As on 8 March 2023, promoters and promoter group held 48.82% in the company.

Assuming the buyback of maximum buyback size, promoter group holding will increase to 49.63%.

Natco Pharma is engaged in the business of pharmaceuticals which comprises research and development, manufacturing and selling of bulk drugs and finished dosage formulations. The company has manufacturing facilities in India which caters to both domestic and international markets including regulated markets like United States of America and Europe.

The company's consolidated net profit tumbled 22.5% to Rs 62.30 crore on 12.1% decline in net sales to Rs 492.50 crore in Q3 FY23 over Q3 FY22.

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