Shares of FDC surged 8% to Rs 319 on the BSE in intraday trade on Monday after the company said its board would meet on February 9, 2022 to consider a proposal to buy back the company’s stake through a takeover bid route.
At 9.26am; shares of the pharmaceutical company were up 7% at Rs 314.75, while the S&P BSE Sensex was down 0.5%. The stock has fallen 14% over the past six months, while the benchmark index has gained 8%. It has fallen 21 percent from a 52-week high of Rs 404.90 touched on June 15, 2021.
A buyback is a corporate action in which a company buys back its shares from existing shareholders, usually at a premium to the market price. The main goal of a share repurchase program is to stop the decline in a stock’s value by reducing the supply of shares, which essentially drives the stock price higher through a better price-to-earnings (P/E) multiple.
In a tender offer, shareholders can choose to submit (or bid) some or all of their shares for a certain time frame at a price above the current market price, a premium that compensates investors for bidding on their shares rather than holding them.
Meanwhile, in a separate regulatory filing, the FDC announced that the company’s Oral Solid Dose Plant in Goa has obtained a Good Manufacturing Practice (GMP) certificate and continues to receive Malaysia’s PICs – NPRA (National Pharmaceutical Regulatory Agency) approval status.
Complete News Source : Business Standard
