Bajaj Auto announces Rs 2,500 crore share buyback, stable share price

Shares of Bajaj Auto were trading flat in today’s afternoon session after the company’s board approved a share buyback worth Rs 2,500 crore. The buyout represents 9.61 percent of the total paid-up share capital. The company said its board had authorized the buyback of shares at a price not exceeding Rs 4,600.

The redemption price is 20.64% or Rs 787.2 higher than the previous close of Rs 3,812.80 on BSE.

The company will use at least 50% of the amount assigned to the maximum redemption size for the redemption which is Rs 1,250 crore (minimum redemption size), he said. Based on the minimum redemption size and maximum redemption price, the company would purchase a minimum of 27,17,392 shares, Bajaj Auto said.

Meanwhile, shares of Bajaj Auto were trading up 0.94% at Rs 3,848 against the previous close of Rs 3,812.80 on BSE. The auto stock hit an intraday high of 3,953.5 rupees, up 3.69% on BSE.

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Bajaj Auto shares were trading above the 5-day, 20-day, 50-day, 100-day and 200-day moving averages. The stock gained 18.52% in 2022 and fell 8.18% in one year.

A total of 0.35 lakh of shares changed hands, representing turnover of Rs 13.52 crore on BSE. The company’s market capitalization has risen to Rs 1.11 lakh crore.

The company said the share repurchase was intended for existing shareholders, excluding promoters, groups of promoters and persons controlling the company and that it would be carried out in the open market through a mechanism scholarship.

It would represent 8.71% of free reserves, including the securities premium account, he said.

“Provided that the market price of the Participating Shares is at or below the maximum redemption price, the indicative maximum number of Participating Shares proposed to be redeemed would be 54,34,782 Participating Shares, or approximately 1 .88% of the paid shares will increase the share capital of the Company effective June 27, 2022,” the company said.

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