Bajaj Auto's board approved a share buyback proposal worth ₹5,633 crore, set at a price of ₹12,000 per equity share. The buyback covers up to 46.94 lakh equity shares, representing 1.68% of the company's paid-up equity capital, according to livemint.com. The record date for the buyback is approaching, with the company’s shares rising ahead of the event.
The buyback was cleared by Bajaj Auto’s board in May, targeting the repurchase of shares to reduce the equity base. The company set the buyback price at ₹12,000 per share, a premium compared to recent market prices, aiming to return capital to shareholders. The move follows a trend among Indian corporates to optimize capital structure and enhance shareholder value, as reported by thehindubusinessline.com.
This buyback is among the larger share repurchase deals in the Indian auto sector, reflecting Bajaj Auto’s strong cash position and confidence in its business fundamentals. Share buybacks can improve earnings per share and return surplus cash to investors, which may support the stock price. The ₹5,633 crore buyback is significant compared to other recent buybacks in the sector, underscoring Bajaj Auto’s strategic capital management.
The record date for the buyback is imminent, with shares already reacting positively in the market. Bajaj Auto’s share price rose 2.52% to ₹26.49 on the NSE in Monday’s trading session ahead of the record date, according to livemint.com. Investors will monitor the buyback’s progress and its impact on the company’s shareholding pattern and stock performance.