JK Lakshmi Cement said its board of directors has approved the buyback offer of 13.5m equity shares at a price not exceeding INR70/share for a total consideration of up to INR975m, India Investment News reports.
"The Board of Directors of the company at its meeting held on February 7, 2012, inter-alia, have approved the buyback of equity shares up to an amount of INR97.50 crore (INR 975m), at a maximum price of INR70 per equity share ie 1.39 crore equity shares of INR5 each from the open market through stock exchanges," JK Lakshmi Cement said in a filing to the Bombay Stock Exchange.
The buyback proposal is expected to increase the company's return parameters and improve its various financial ratio's such as earnings per share (EPS) and return on equity (ROE).
"Going forward, the buyback shall result in overall enhancement of shareholders' returns in the long run," it added.
Earlier Tuesday, the cement producer reported a 10-fold jump in its net profit to INR492.4m in the third quarter (October-December) of this fiscal year 2011-12, as against INR46m in the same period last fiscal year on the back of surge in sales volume.