Kaveri to repurchase shares through buy back

This time around Kaveri Telecom would be rewarding shareholder's by repurchasing shares for a price of 116.75/share. The company plans to make an open offer to purchase 28,13,796 representing 20% of the paid up equity capital.


Share repurchases are more rewarding as compared to dividend payouts, because dividend income is taxed, which translates to double taxation for shareholders.








Share Repurchase by Kaveri

Disappointing FY11 June results for Kaveri

Kaveri Telecom declared the June quarter results on Aug 14, and in my opinion the results were disappointing. The company registered marginal growth in sales and practically no growth in profits. The company also deducted 18 crores for the increase in stock from the expenses side. This, along with a no growth in the profits has made me sell the shares in the short term. I am expecting some selling to be made in this counter in the coming weeks, after which I will be covering my position.

The long term story of the stock still holds good. Please note, the growth for companies in India during the first quarter of a financial year is usually slow compared to the other quarters.

Kaveri Telecom - Promoter stake to go over 35%

The promoters in the board meet have decided to raise capital by alloting preferrence shares. Who will buy the shares? Well, the promoter's themselves!!!

After the purchase the promoter's stake will get raised to over 35%, which is a kind of assurance to an investor like me. The results for Q1 2011 are supposed to be announced on Aug 14, 2010. If the results beat expectations, the stock will rally again.

Kaveri Telecom

Kaveri Telecom is one company, which is my personal favourite. Unless and until something really goes wrong with the sector or the management messes things up, this counter will not find a way out of my portfolio. Like a father, in love with his child, I am in love with this stock. Probably because I have seen this stock grow since 2006, when it was a teenager in puberty. And today the company is a man ready to face the world.