How can I apply in Buyback with Zerodha?

This is a very basic question asked by many users. To apply in the buyback, you must have holding of scripts on the record date. If you wish, you can sell your script  (optional) after the buyback record date and buy it again just before the buyback opens and tender your shares for a buyback. Usually, there are 1 to 2 months of processing time between the record date and buyback close date. So you don’t need to block your money for 2 months in case you are a retail trader.

Before buyback window opens, Registrar sends Letter of Offer and Tender Form (“personalized Form of Acceptance-cum-Acknowledgement”) via email or in a physical format at your registered address. The Letter of Offer and  Tender Form are being sent to you as a registered equity shareholder of the Company as on the Record Date.

Now answering the question- how to apply/participate in buyback with Zerodha:

Brokerage firms like ICICIDirect, HDFC Securities has an option in IPO Section, where you can tender your holdings in buyback online. Zerodha also providing online option for tendering your buyback scripts on your convenience.  You can do buyback tender of shares with Zerodha online in a less than 30 second.

1: Login to console.zerodha.com with your Kite login ID.

• Under the Portfolio Tab – You have the "OFS/Buyback" Button.
  • You will get a list of all open buyback offers.
  • Add the buyback quantity and save.
  • Charges for Buyback Tender: Rs 20 + GST
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2:Send an email to [email protected] with the following detail – (Option Closing on 20^th Dec 2018), After that no more manual orders will be accepted.

• Your Zerodha Client ID.
• Script/Stock which you want to apply in Buyback.
• The number of shares you wish to apply in Buyback.
• Charges for Buyback Tender via eMail is: Rs 100 + GST

3:Fill Physical Tender Form and submit to your nearest branch office or courier to Zerodha Sales office. – Not applicable, as Zerodha has provided a online submission process.

The broker will consolidate all Buyback request and send to exchange on a regular interval. When you are applying for the buyback, you must have held of scripts in your demat account. You need to plan in advance if you have sold the script after the record date.

We personally suggest to tender all equity shares (complete holding of the script as of Record Date) since the actual acceptance ratio can be higher from proposed acceptance ratio in Tender Form.

For example – Record date for XYZ share buyback is Jan 30, 2017. So one must have stocks in demat account on or before 30^th Jan 2017. For that, you need to buy a script by 28^th Jan 2017 considering there are no settlement holidays. Usually, there are T+ 2 days of settlement window, so you must have plan accordingly.

Once you have holding on the record date, to declare buyback open and end date this process takes 4 to 6 week and you will get 2 weeks of buyback window, so after 30^th Jan 2018 you can sell your scripts (optional) in case you don’t want to lock your money for approx 2 months.  Once buyback window dates announce you can again accumulate the shares and apply for buyback.

Assume XYZ Company announces buyback open and close date as 10^th March 2017 to 25^th March 2017. You can apply in buyback in this window any time by sending an email to Zerodha support team.

This is a very basic question asked by many users. To apply for the buyback, you must have holding of scripts on the record date. If you wish, you can sell your script (optional) after the buyback record date and buy it again just before the buyback opens to tender your shares for a buyback. Usually, there are 1 to 2 months of processing time between the record date and the buyback close date. So you don’t need to block your money for 2 months in case you are a retail trader.

Before the buyback window opens, the Registrar sends a Letter of Offer and Tender Form (“personalized Form of Acceptance-cum-Acknowledgement”) via email or in a physical format to your registered address. The Letter of Offer and Tender Form are sent to you as a registered equity shareholder of the Company as on the Record Date.

Now answering the question—how to apply/participate in buyback with Zerodha:

1. Online Buyback Application

• Login to console.zerodha.com with your Kite login ID.
  • Under the Portfolio Tab, click on the "OFS/Buyback" button.
  • You will get a list of all open buyback offers.
  • Add the buyback quantity and save.
  • Charges for Buyback Tender: Rs 20 + GST
• 
• 

2. Email Submission

Send an email to [email protected] with the following details:

• Your Zerodha Client ID
• The script/stock you wish to apply for in the buyback
• The number of shares you wish to tender
• Charges for Buyback Tender via email: Rs 100 + GST

Note: Email orders must be submitted before the closing date. For example, if the option closes on December 20, 2018, no manual orders will be accepted after that.

3. Physical Submission

Not applicable: Zerodha has provided an online submission process, so there is no need for physical tender forms or couriering them to Zerodha offices.

The broker consolidates all Buyback requests and sends them to the exchange at regular intervals. When applying for the buyback, you must have held the scripts in your demat account on the record date. Plan in advance if you have sold the script after the record date.

We personally suggest tendering all equity shares (complete holding of the script as of Record Date) since the actual acceptance ratio can be higher than the proposed acceptance ratio in the Tender Form.

Example Scenario

Record Date: January 30, 2017

• To participate, you must hold stocks in your demat account on or before January 30, 2017. To achieve this, buy the script by January 28, 2017, considering no settlement holidays.
• Usually, there is a T+2 days settlement window, so plan accordingly.

After holding the shares on the record date, the process to declare the buyback's open and close date typically takes 4 to 6 weeks. The buyback window lasts about 2 weeks. After January 30, 2018, you can sell your scripts (optional) if you don’t want to lock your money for approximately 2 months. Once the buyback window dates are announced, you can repurchase the shares and apply for the buyback.

Example: XYZ Company announces the buyback open and close date as March 10, 2017, to March 25, 2017. You can apply for the buyback during this window by submitting an email to the Zerodha support team.