NEW DELHI: After 22 years, Bajaj Auto is going for a share buyback. The Pune-based automaker will be spending a maximum of Rs 2,500 crore for buying back its equity shares from open market. It will offer a maximum offer price of Rs 4,600 per share for buying nearly 1.88 % of the paid-up share capital of the company as of June 27. Bajaj Auto’s share prices on Monday closed 1.29% higher at Rs 3,862.
The amount also represents 9.61% and 8.71% of the aggregate of the total paid-up share capital and free reserves (including securities premium account) respectively, of the Company based on the latest audited financial statements as of March 3 I, 2022 ( on a standalone and consolidated basis, respectively).
According to a statement issued by Bajaj Auto, the indicative maximum number of equity shares proposed to be bought back would be 54,34,782, comprising nearly 1.88% of the paid-up share capital of the company as of June 27, 2022.
On June 14, the company’s board had deferred a decision on its proposed share buyback citing further deliberations were required on the proposal. Now that Bajaj Auto is going ahead with a buyback plan, it would be a first in 22 years. The company had in September 2000 made an offer to buyback about 18 million shares at a price of Rs 400 per share.
Ashwin Patil, senior research analyst at LKP Securities, while giving a buy rating to the stock said it may not reach those levels by the time the buyback offer closes.