Novartis India tumbles after board OKs buyback

Novartis India fell 7.56% to Rs 631 at 14:28 IST on BSE after the company said it approved proposal for share buyback worth up to Rs 231 crore.

The announcement was made during trading hours today, 25 September 2017.

Meanwhile, the S&P BSE Sensex was down 347.56 points, or 1.09% to 31,574.88.

On the BSE, 1.30 lakh shares were traded in the counter so far, compared with average daily volumes of 16,376 shares in the past two weeks. The stock had hit a high of Rs 695.10 and a low of Rs 626 so far during the day.

The stock hit a 52-week high of Rs 758 on 18 April 2017. The stock hit a 52-week low of Rs 579 on 11 August 2017.

Novartis India said that its board approved a proposal to buyback upto 34.50 lakh equity shares of Rs 5 each, representing 12.26% of the total paid-up equity capital, from the existing equity shareholders of the company on the record date. The company will buyback shares at Rs 670 per equity share, aggregating to Rs 231.15 crore.

The board noted the intention of the promoter of the company to participate in the proposed buyback.

The buyback price of Rs 670 is 6.18% premium to the ruling market price of Rs 631.

Net profit of Novartis India declined 63.14% to Rs 7.03 crore on 32.98% decline in net sales to Rs 114.81 crore in Q1 June 2017 over Q1 June 2016.

Novartis India has core businesses in pharmaceuticals, vaccines, consumer health, generics, and eye care. Novartis AG holds 73.4% stake in Novartis India (as per the shareholding pattern as on 30 June 2017).

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