Insecticides share Buyback news: Insecticides (India) share price today hit a record high of Rs 1,084.65 as it rallied 17 per cent on the BSE in Wednesday’s intraday trade after the company said it would consider a share buyback proposal on Friday, August 30, 2024.
The stock of the pesticides and agrochemicals company surpassed its previous high of Rs 965.35, touched on August 12. Thus far in the month of August, the market price of Insecticides (India) has appreciated 36 per cent. Further, it has zoomed 128 per cent from its June month low of Rs 475.50 on the BSE.
At 12:58 PM, Insecticides (India) share price was trading 12 per cent higher at Rs 1,039.50, as compared to 0.29 per cent rise in the BSE Sensex.
In an exchange filing, Insecticides (India) said the meeting of board of directors of the company is scheduled to be held on Friday, August 30, 2024, to consider the proposal for buyback of fully paid-up equity shares of the company through tender offer route.
Meanwhile, 11 companies have collectively repurchased shares worth Rs 5,388 crore in August. As many as 10 other companies, including Aarti Drugs, Transport Corporation of India, Nucleus Software Exports, Technocraft Industries (India) and Mayur Uniquoters, have approved share buyback proposals.
Analysts believe the sharp surge in share buyback proposals is due to the changes in India’s share buyback tax regime, which will come into effect from October 1.
The new rules, which were announced in the Union Budget presented in July 2024, will shift the tax burden from companies to shareholders, altering the landscape for buyback strategies. Companies undertaking a buyback now have to pay effectively over 20 per cent as buyback tax. Shareholders tendering their shares do not attract any tax.
On its part, Insecticides (India) is engaged in the manufacturing activities of agro-chemicals, pesticides, and technical products for agriculture purposes. The company caters to both domestic and international markets.
In Q1FY25, the company reported a 57 per cent increase in earnings before interest, tax, depreciation and amortisation (Ebitda) and a 68 per cent rise in profit after tax.
The management said the company will prioritise driving growth in premium products in FY25 through enhanced demand generation and brand-building efforts while maintaining a disciplined approach to margins and working capital.
The government of India’s initiatives aimed at improving manufacturing facilities, streamlining regulatory processes and promoting exports can open opportunities for Indian agrochemical companies in the global market.
The “Make in India” initiative by the government has also played a crucial role in advancing the agrochemical industry by promoting domestic manufacturing, reducing regulatory barriers and facilitating infrastructure development.
Additionally, initiatives like ‘Aatmanirbhar Bharat Abhiyan’ highlights the importance of self-reliance and resilience in key sectors like agrochemicals. This aims to reduce dependency on imports and enhance competitiveness. The proposed production-linked incentive system for the agrochemical sector is also expected to further boost domestic manufacturing, create employment opportunities and elevate the country’s global competitiveness, the company said in its FY24 annual report.
First Published: Aug 28 2024 | 1:49 PM IST
