Bajaj Auto dips after buyback window closes; down 4%

29 Feb 2024 , 03:36 PM

On February 29, when the company’s shares were traded ex-buyback, they dropped by almost 4%. A record date of February 28 was set for the ₹4,000-Crore share repurchase that the company’s board had approved in January.

Bajaj Auto shares were trading at ₹7,911.15 on the NSE at 15:18 p.m.

At a price of ₹10,000 per share, the business stated that 40 Lakh shares, or 1.4% of the total, will be repurchased. The buyback’s floor price is eighteen percent above the going market rate. The tender offer process will be used to carry out the buyback.

However, a lower acceptance ratio is anticipated due to the smaller buyback and more retail shares. Nuvama researchers predict that the acceptance ratio will be between 4 and 10%. Retail investors are those who have up to ₹2 Lakh invested.

It is anticipated that the buyback would be finished in the upcoming 15 days.

It is also the second share buyback by Bajaj Auto in the previous two years. In the past, the two-wheeler company paid ₹4,600 per share to stakeholders for shares valued at ₹2,500 Crore. With a cash position of ₹20,000 Crore at the end of FY24, the company will have the flexibility to compensate investors and execute the repurchase.

In the last year, the two-wheeler company’s shares have more than doubled; last month, they reached an all-time high of ₹8,650.

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