Tanla Platforms' share buyback decision to be taken in board meet today
Premium- Tanla Platforms had informed that its board will meet on September 8 to consider share buyback proposal
Tanla Platforms last week informed that its board will meet on Thursday, September 8, 2022 to consider the proposal of share buyback of the company. Shares of Tanla Platforms have been gaining ahead of the buyback proposal as the stock has surged more than 14% in the last five trading sessions.
“This is to inform you that the board of directors of the company will consider a proposal for buyback of equity shares of the company including matters related/ incidental thereto, at its meeting which is scheduled to be held on Thursday, September 08, 2022," Tanla Platforms said in an exchange filing today.
A share buyback, also known as share repurchase, is a corporate action to buy back its own outstanding shares from its existing shareholders usually at a premium to the prevailing market price. It can be an alternative tax-efficient way to return money to shareholders. Share buybacks reduce the number of shares in circulation, which can increase the share value and the earnings per share (EPS).
Hyderabad-based Tanla Platforms provides provides value-added services in the cloud communications space. Tanla Platforms shares have declined more than 55% in 2022 (YTD) so far, and is down 7% in a year's period. However, in the past five years, the stock has given multibagger return of more than 2,230%.
The company's net profit for the first quarter ended June 30, 2022 (Q1 FY23) fell to ₹100 crore as compared to ₹140 crore in the March quarter. Tanla's revenue was 27.7% year-on-year (YoY) however, was down 6.2% from the last quarter (Q4FY22) whereas EBITDA margin decreased 530 bps quarter on -quarter (QoQ) (530 bps YoY) to 16.3%.
“Overall, it reported mixed performance for the quarter. While, the revenue for the quarter was inline, EBITDA margin came sharply below estimates on several operational headwinds such as pricing pressure in few pockets, downtime due to modernization of platform and cross currency headwinds. The Q1 is a seasonally weak quarter and that led to sequential dip in revenue," brokerage Yes Securities had said in a Q1 review note.
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The company remains a leader in CPaaS space in India, growing faster than the industry. The adoption of CPaaS based A2P messaging across industries continues to drive volume growth for both enterprise and platform segments, the note added.
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