Bajaj Auto board approves shares buyback
Economic Times, 10 Jan '24
Bajaj Auto on 8th, January, 2024, approved buyback of shares worth Rs. 40 billion (US$ 480 million) through the tender offer route.
The two-wheeler major will repurchase up to 4,000,000 shares for a price not exceeding Rs. 10,000 a share, the company said in an exchange filing.
Dalal Street is set to rejoice this news, as the buyback price is at a 43% premium to the current market price. Recently, shares of Bajaj Auto ended at Rs. 6,983.85 on the National Stock Exchange, up 0.1% from the previous close.
The buyback size represents 1.41% of the total number of equity shares of the company. Currently, promoter and promoter group entities hold 54.94% stake in Bajaj Auto, and foreign institutional investors hold 14.72%.
Earlier last week, when Bajaj Auto had announced that its board would meet to consider share buyback, the stock scaled a lifetime high of Rs. 7,084. This is the second time Bajaj Auto will be conducting a share repurchase programme.
In July 2022, the two-wheeler maker had bought back shares worth Rs. 25 billion. The buyback was then done at Rs. 4,600 a share.
Since the first share buyback, the share value of the automaker has more than doubled.
The last time Bajaj Auto had done the share buyback through the open market, however, this time it will be through the tender offer route.
