Saturday, August 19, 2017

What is acceptance ratio what it means for buyback offered by Infosys at 1150₹ per share

Acceptance ratio
Its tells you how likely it is for your shares to be accepted by the company. This ratio is calculated as the percentage stake in the open offer divided by the percentage stake held by external shareholders.

For instance, if the percentage stake in the open offer is 26% and the percentage stake held by external shareholders is 52%, then the acceptance ratio is 0.5. 

This means the company will accept one share for every two shares held by external shareholders. The higher the acceptance ratio, the more the chances of the shares being accepted in the open offer.
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For Infosys it would mean 10 shares for every 100 share held by the investor as the retail investor holding in company is around 25%  which means there would be a 20-25₹ gain per share.
Infosys buyback to lead to net EPS accretion of 0.9% for FY18
Infosys Buyback | Offer At Rs 1,150 Per Share; Price Set At Premium Of 24.6% To CMP Of Rs 923 On August 18
This could be short term positive for the stock and we may see stock bouncing to 1000 levels in the coming month.
The buyback would complete in next 3 months.
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