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Business News/ Markets / Stock Markets/  Bajaj Auto announces share buyback. 5 things you should know
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Bajaj Auto announces share buyback. 5 things you should know

Bajaj Auto Ltd board has approved share buyback worth not exceeding ₹2500 crore

Bajaj Auto share buyback will be done from open market through stock exchange mechanism. (HT)Premium
Bajaj Auto share buyback will be done from open market through stock exchange mechanism. (HT)

Bajaj Auto share buyback: The board of directors of Bajaj Auto Limited has approved the proposal for buyback of company's shares at 4600 per share buyback price. The share buyback will be done from open market through stock exchange mechanism. The company board approved this buyback in its meeting held on 27th June 2022 i.e. on Monday. The board also made it clear that Bajaj Auto share buyback won't exceeding 2500 crore.

Informing about the share buyback to Indian exchanges, Bajaj Auto Limited said, "We wish to inform you that the Board of Directors of the Company ("Board") at its meeting held today i.e. Monday, 27 June 2022, has approved the proposal for buyback of the fully paid up equity shares of the Company having a face value of Rs. 10/- each ("Equity Shares") from the existing shareholders of the Company ( except promoters, promoter group and persons in control of the Company) from open market through stock exchange mechanism (i.e through National Stock Exchange of India Limited and BSE Limited collectively "Stock Exchanges") at a price not exceeding Rs. 4,600/- ("Maximum Buyback Price") per Equity Share and such aggregate amount, up to Rs. 2,500 crore ("Maximum Buyback Size"), representing 9.61 % and 8.71% of the aggregate of the total paid-up share capital and free reserves (including securities premium account) of the Company based on the latest audited financial statements of the Company as at March 31, 2022."

Subject to the market price of the equity shares being equal to or less than the maximum buyback price, the indicative maximum number of equity shares proposed to be bought back, would be 54,34,782 equity shares ("Proposed Buyback Shares"), comprising approximately 1.88 per cent of the paid-up share capital of the Company as of 27 June 2022. If the Equity Shares are bought back at a price below the maximum buyback price, the actual number of equity shares to be bought back could exceed the proposed buyback shares, but will always be subject to the maximum buyback size.

"The Company will utilise at least 50% of the amount earmarked as the Maximum Buyback Size for the Buyback i.e. Rs. 1,250 Crores ("Minimum Buyback Size"). Based on the Minimum Buyback Size and Maximum Buyback Price, the Company would purchase a minimum of27,17,392 Equity Shares."

Here we list out to 5 things that a Bajaj Auto shareholder should know:

1] Buyback price: The board of directors of the company has fixed buyback price at 4600 per equity share.

2] Buyback size: The board of directors has approved share buyback not exceeding 2500 crore.

3] Buyback process: Bajaj Auto share buyback will be done from open market through stock exchange mechanism.

4] Buyback proceeds: The company has made it clear that fifty per cent of the buyback proceeds will be utilised by the company.

5] Buyback ratio: The maximum buyback size would be 9.61 per cent of total paid-up capital of the company.

Bajaj Auto share price today is around 3795 (at 9:33 AM) on Tuesday.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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ABOUT THE AUTHOR
Asit Manohar
Chief Content Producer at Live Mint Digital Team
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
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Published: 28 Jun 2022, 09:35 AM IST
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