Nava Ltd, a leading small-cap company in metals, energy, mining, and agriculture, has announced a share buyback worth ₹360 crore. The company will buy back 72 lakh fully paid-up equity shares at ₹500 per share through the tender offer route. This buyback represents 2.48% of its total paid-up equity capital and 9.87% of its total equity capital and free reserves as of March 31, 2024.
Key Details of the Buyback
- Buyback Size: ₹360 crore
- Number of Shares to be Bought Back: 72,00,000 equity shares
- Buyback Price: ₹500 per share
- Record Date: February 28, 2025
Why is Nava Ltd Conducting a Share Buyback?
On February 19, 2025, the Board of Directors approved the buyback to:
- Enhance shareholder value
- Optimize the capital structure
- Boost investor confidence
- Improve earnings per share (EPS)
A Buyback Committee will oversee the process. The board also has the flexibility to adjust the buyback price while maintaining the total buyback amount.
The company will soon issue a public announcement and letter of offer with detailed information about the buyback process and timelines.
Nava Ltd’s Financial Performance (Q3 FY25)
In the latest quarter, Nava Ltd reported mixed financial results:
- Revenue: ₹878.1 crore (down 11.7% YoY from ₹995 crore in Q3 FY24)
- Net Profit: ₹353.3 crore (down 24% YoY from ₹465 crore)
- EBITDA: ₹485.5 crore (up 2.2% YoY)
- EBITDA Margin: 55.3% (up from 47.8% YoY)
Despite a drop in revenue and profit, Nava Ltd improved its operational efficiency, increasing its EBITDA margin by 752 basis points.
About Nava Ltd
Founded in 1972 and headquartered in Hyderabad, India, Nava Ltd operates in three main segments:
- Ferro Alloys: Produces ferro chrome, silico manganese, and ferro silicon
- Power: Generates thermal energy for captive use and external sale
- Mining: Engages in coal mining for both captive use and outside sale
Market Cap: ₹12,300 crore
PE Ratio: 11.1x (compared to the industry average of 17.7x)
Promoter Holding: 48.89%
Final Thoughts
Nava Ltd’s ₹360 crore share buyback is a positive move for investors, offering an attractive exit option at ₹500 per share. The buyback reflects the management’s confidence in the company’s future while optimizing the capital structure.
With a strong EBITDA margin, an undervalued position compared to industry peers, and ambitious growth plans, Nava Ltd remains a stock to watch in 2025.
Disclaimer: This article is for informational purposes only and should not be considered investment advice.
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