Jindal Steel and Power Ltd has bought back shares worth Rs 500 crore from the public, utilising just half the amount it had set apart for the buyback offer.
It decided to close the offer today, as against the earlier stated date of March 15.
JSPL had proposed to buy back shares worth up to Rs 1,000 crore or 8.73 per cent of its paid up capital. Its board in August had fixed a price of Rs 261 per share for the offer to be conducted through stock exchanges.
"As per Regulation 14(3) of the SEBI (Buyback of Securities) Regulations, 1998, as amended, the Company has utilised at least 50 per cent of the amount earmarked for the Buy-Back as specified in the resolution passed by the Board of Directors on August 30, 2013, i.E., the Minimum Buy-Back Size of Rs 500 crores," JSPL said in a filing to the BSE.
JSPL Chief Financial Officer K Rajagopal had said on August 30 that through the buyback offer, it wants to give a signal to its investors that company's fundamentals are strong and it is on track to achieve its growth plans.
Companies opt for share buyback to improve valuations, though it reduces the quantum of their scrip's free float in the open market.
As on December 31, 2013, JSPL promoters had 56.67 per cent stake in the company, while FIIs and DIIs had 21.93 per cent and 4.74 per cent stake respectively. The rest are held by the general public.
The company scrip closed at Rs 252.45, up 6.93 per cent, on the BSE.
