This small cap shipping stock was down by 18 percent on friday after the company made a counter offer for the share buyback. 

At the day’s closing the shares of Shreyas Shipping and Logistics Limited were trading at Rs 386 down by 18 percent from its previous day close price and the market capitalization of the company is 848 Cr. 

As per the company’s filing on BSE, the promoters of Shreyas Shipping and Logistics, Transworld Holdings Limited has rejected the discovery price of Rs 890 per share and has given a counter offer of Rs 400 per share for the buy back of shares from the public. Post the counter offer the public shareholders were not happy from this move thereby the shares of the company declined by 18 percent in today’s market. 

The promoter group Transworld Holdings Limited who hold 56.25 percent stake in the company along with its promoters who entirely hold 70.44 stake of the total issued capital and 71.25 per cent of the remaining shares, have decided to delist the company, but as per the sebi guidelines the promoters should jointly hold a minimum of 90 percent stake in the company. 

So the company announced that it is going to buy back shares through reverse book building and the offer for the buy back of shares will open from september 20, 2023 to september 26, 2023 and the floor price for the offer will be Rs292.The company had later announced its intention to buy the shares at Rs 375 which was above the floor price of Rs 292. 

Post the closing of the buy back offer out of the 29.56 percent stake held by the public 18.55 percent of the total issued capital and 18.76 per cent of the remaining shares of the public were successfully bid below the floor price of the offer thereby gaining a minimum 90 percent stake for the promoters. 

But the offer was not completed, as post the offer the discovery price in the tendering process through a reverse book-building route came in at Rs 890 per share. Following this the promoters should accept the discovery price for the offer or present a counter offer for the buyback. 

Following this on September 29, 2023 the promoters rejected the discovery price of Rs 890 and gave a counter offer of Rs 400 per share for the buyback. 

The company’s revenue has decreased by 9.71 percent from 535.78 Cr in FY22 to 483.78 Cr in FY23, accompanied by profits of 211.07 Cr to 196.9 Cr. 

The company has reported a return on equity (ROE) of 27.19 percent and return on capital employed (ROCE) of 19.96 percent, this indicates that the company is able to generate good returns on its equity and make efficient use of the company’s resources.

According to the latest shareholding data available for the June 2023 quarter, the company’s Promoters hold 70.44 percent stake, and the Foreign Institutional Investors (FII) hold 0.17 percent. 

Shreyas Shipping and Logistics is one of the leading players in the coastal shipping sector, it is engaged in owning and chartering container and bulk vessels. 

Written by: Bharath K.S


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