Buy-back of Shares

Eshani Athalye 01 Gaurav Ghode 09 Swati Goswami 10 Krishna Kumar 20 Sahista Iqbal 35 Harsh Salia - 36

What is buy-back of Shares ?

Buyback of shares : It is a process where the company buys the share from its shareholders. Done from shareholders other than the promoters themselves

Reasons for buy-back ?

To return surplus cash to the shareholders To increase the underlying share value To support the share prices during temporary weakness To prevent hostile take-over bids The buy back may improve companies return ratios Eventual delisting

Resources for Buyback

Free reserves Securities Premium Account Proceeds of issue of shares or other securities Borrowings from bank/financial institution

Conditions of buy-back
Authorized by the Articles of Association of the Company Resolution for buyback to be passed by the Board Buy-back of equity shares shall not exceed 25% of total paid-up equity capital in a financial year All the shares or securities for buy-back should be fully paid up Debt equity ratio must not be greater than 2:1 post buy-back Buy-back shall be completed within 12 months of passing the resolution by the Board

Procedure of buy-back
Filling of letter of offer with the Registrar of Companies Declaration of Solvency Dispatch of offer letter (21 days) Offer for buy-back (15 30 days) Acceptance per shareholder be on proportionate basis

Procedure of buy-back
Verification (15 days) Communication of rejection (21 days) Open an Escrow Account Deposit therein entire sum due and payable as consideration for buy-back Make payment within 7 days from 15 days from date of closure

Procedure of buy-back
Destroy share certificates within 7 days of acceptance of shares. File a certificate to ROC verified by 2 Directors including MD and Company Secretary for compliance of rules (within 7 days from extinguishing of shares) Maintain a record of share certificates, cancelled and destroyed within 7 days of buy-back Filling of return with the Registrar and Securities and Exchange Board of India within 30 days of completion of buy-back

Reliance Industries
Sr. No 1 2 3 4 5 6 7 8 Particulars Board Meeting approving Buy-back Date of public issue Date of opening of buy-back Last date of buy-back Approved buy-back No. of shares for buy-back Maximum offer price per share Total buy-back till date Details January 20, 2012 January 20, 2012 February 1, 2012 January 19, 2013 Rs. 10,440 crores 12 crores @ Rs. 10 each Rs. 870 /share 5 lakh shares

Reliance Industries
The Share Capital:
As on January 20, 2012 (Rs. In crore) Authorized: 5,00,00,00,000 Equity Shares of Rs. 10 each 1,00,00,00,000 Preference Shares of Rs. 10 each Issued, Subscribed and Paid-up 3,27,47,22,771 Equity Shares of Rs. 10 each fully paid-up (Post buy-back*: 3,15,47,22,771 Equity Shares of Rs. 10 each fully paid-up) Total 3,274.72 3,154.72 5,000.00 1,000.00 6,000.00 5,000.00 1,000.00 6,000.00 Post Buy-back (Rs. In crore)

3,274.72

3,154.72