State-owned GAIL on Thursday approved buyback of fully paid-up equity shares. The company said that it intends to buyback shares worth Rs 1,082.72 crore of the company under the share buyback scheme. GAIL will buy back shares of more than Rs 5,69,85,463 of face value of Rs 10 at Rs 190 each. GAIL shares were trading 0.59 per cent higher at Rs 154.30. The buyback price is at a premium of 24 per cent against Wednesday’s closing price of Rs 153.40. The buyback price of GAIL’s equity share is at a premium of 24 per cent on the NSE on the previous day.
The Company has fixed Friday, April 22, 2022, as the record date for the purpose of ascertaining the eligibility of shareholders for buyback of equity shares. The buyback will be offered on a proportionate basis through a tender offer route as per SEBI Regulations, 2018. State-owned Natural Gas Corporation’s shares were trading higher by over 1 per cent at Rs 155.05 at 12:28 pm.
GAIL Share Buyback Details
The size of the Company’s buyback offer represents 2.50 per cent of the fully paid-up equity share capital and 2.22 per cent of the free reserves as per the Company’s audited standalone and consolidated FY 2011 financial statements.
It will be offered on pro-rata basis through a tender offer route as per SEBI Regulations, 2018.
GAIL Shareholding Pattern
As per the company’s pre-buyback shareholding pattern as on Friday, March 25, 2022, the government held 51.45 per cent in GAIL, 19.37 per cent in FPIs and 9.09 per cent in mutual funds.
What is Share Buyback?
A tax-effective way to reward shareholders, under a share buyback or share repurchase offer, a company buys back its own shares from investors or stakeholders.
Previous buybacks by GAIL
GAIL did share buyback in 2020-21, from which the government got Rs 747 crore. The company bought back more than 6.97 crore shares or 1.55 per cent of the total paid-up equity. Then the price was fixed at Rs 150 per share.
Starting as a natural gas transmission firm in 1984 with a single cross-country trunk pipeline, GAIL has now become India’s leading natural gas company.
It is the largest integrated natural gas marketing and transmission company with the entire natural gas value chain including gas transmission and marketing, LPG transmission, gas processing, petrochemicals, LNG import, exploration and production, and city gas distribution (CGD).
GAIL owns and operates approximately 13,840 km of natural gas pipeline network which is 74 per cent of the total length of the cross-country natural gas pipeline network in 28 states and union territories.
GAIL is the leading gas marketing company in India, with about 52 per cent of Natural Gas and 44 per cent of LNG sold in India.
The company supplies 67 percent of the gas consumed in the fertilizer sector, 53 percent of electricity and 60 percent of CGD in India. Its LNG portfolio is over 14 MTPA (million tonnes per annum).
PSUs have also undertaken alternative energies like green hydrogen, renewable energy and bio-fuel projects which are of national importance and will likely provide a transition to the future.
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