 "Bajaj Auto Ltd")
Shares of Bajaj Auto hit a new high of Rs 7,059.75 as they rallied 6 per cent on the BSE in Wednesday's intraday trade, in an otherwise weak market, after the company announced that its board will consider share buyback proposal on Monday, January 8. In comparison, the S&P BSE Sensex was down 0.6 per cent at 71,486 at 02:57 PM.
The stock of the two-wheeler company surpassed its previous high of Rs 6,832.75, touched on December 29, 2023. With today's gain, the market price of Bajaj Auto has zoomed 96 per cent in the past one year, as against nearly 17 per cent surge in the benchmark index.
Bajaj Auto, in an exchange filing, said the meeting of the Board of Directors of the company is scheduled on January 8, 2024, inter alia, to consider and approve a proposal to buyback of fully paid-up equity shares of the company and other matters necessary and incidental thereto.
Earlier, in financial year 2021-22 (FY22), Bajaj Auto had bought back 6.41 million equity shares for an aggregate amount of Rs 2,500 crore. As per approval given by the Board, at its meeting held on June 27, 2022, the buyback of the equity shares of the company was done through open market route through stock exchanges at a price not exceeding Rs 4,600 per equity share.
Share or stock buyback is the practice where companies decide to purchase their own share from their existing shareholders either through a tender offer or through an open market.
The buyback will help the company to distribute surplus cash to its shareholders holding equity shares broadly to the proportion of their shareholding, thereby, enhancing the overall return to shareholders.
