The Hyderabad-based Sirpur Paper Mills Ltd has announced a share buy-back at a maximum price of Rs 40 per share through open market purchases. The company's shares are at present traded at Rs 29 on the Bombay Stock Exchange.
The company's board of directors at their meeting held yesterday approved a maximum amount of Rs 7 crore to be utilised for the buy-back of 20 lakh equity shares through the stock exchange mechanism.
The decision to buy back the shares was taken keeping in mind the undervaluation of its stock on the stock exchanges and to provide better shareholder value, company sources said. The company present has a paid-up capital of Rs 8.35 crore.
For the nine-month period ended December 2001, Sirpur Paper Mills reported a net profit of Rs 10.48 crore on a turnover of Rs 118 crore. Its expansion project to increase the paper and paper board production capacity by another 22,000 tonnes per annum from the current level of 60,000 tonne is in advanced stage of completion.