India One of India’s top producers and exporters of raw cotton, Axita Cotton, saw a huge increase in the price of its stock recently. The revelation that the corporation is thinking about buying back equity shares is what caused this increase. The stock then increased by 5%, reaching the upper circuit limit.
The Axita Cotton board was due to meet on Tuesday, May 23, 2023, to formally approve this proposal. The business has proposed a massive buyback of Rs. 56 per share, almost twice as much as its closing market price of Rs. 27.41 on May 24, 2023. In compliance with the requirements established in the Companies Act, the board thoroughly assessed the buyback’s viability. and the Securities and Exchange Board of India (SEBI) (Buyback of Securities) Regulations, while at all times remaining in strict accordance with all applicable laws. For the past three years, Axita Cotton has demonstrated a solid 265% compounded profit increase. Additionally, during the previous three years, they have maintained a healthy ROE of 38%.
Shares of Axis Cotton increased 5% after the news, reaching a price of Rs 27.30 at 9:55 am, which activated the buyer’s circuit limit. With this rising trend, Axita Cotton now has a 550 crore rupee market value. Notably, over the previous year, the stock had essentially settled at 50%. A dividend has been declared by Axita Cotton Ltd. for September 19, 2022. They had distributed Bonus copies of thrice in the past four years. The business has no debt, and its profitability is rising year over year. Axita Cotton shares are not pledged.
Gross margins are increasing in terms of financial performance, and Axita Cotton has produced solid outcomes. The company declared a net profit after tax for the three months ending March 31, 2023, of Rs. 5.6 crore and operating revenue of Rs. 125.88 crore. Additionally, Axita Cotton generated Rs. 552.6 crore in operating revenue and Rs. 17.09 crore in net profit after tax for the entire fiscal year 2022–23.
Axita Cotton is committed to maintaining its good performance going forward, making sure it complies with legal standards, and producing value for its stakeholders. Axita Cotton possesses high promoter holding of 69.65%. The cash conversion cycle is of 24 days (in Financial year 2022-2023), an ROCE of 48.7% (in Financial year 2022-2023) and high cash liquidity.
Also, in compliance with Regulation 42(2) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Regulation 9(i) of the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 2018, the Company has fixed, Friday, June 02, 2023 as the record date for buyback.
