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Bajaj Auto mcap zooms past ₹2 trn on share buyback plan
Business Standard
|January 10, 2024
Bajaj Auto's market capitalisation (market cap) hit ₹2 trillion mark for the first time.
The stock of the two and three-wheeler major rallied 6 per cent to hit a new high of ₹7,420 on the BSE in Tuesday's intraday trade after its board approved ₹4,000 crore share buyback at ₹10,000 per share.
The stock ended the day at ₹7,093.75, up 1.55 per cent and its market cap a shade above ₹2 trillion. The buyback price is at a 41 per cent premium to the current closing price.
In the past one year, Bajaj Auto has outperformed the market by zooming 96 per cent. By comparison, the S&P BSE Sensex was up 19 per cent and the S&P BSE Auto index 43 per cent during the period. On Monday, Bajaj Auto said the company will buy 4 million shares via the tender route, representing 1.41 per cent of Bajaj Auto's outstanding shares. Company promoters, who currently hold 54.94 per cent stake, will also participate in the buyback, the company said in an exchange filing.
The company had purchased shares worth ₹2,500 crore in July 2022 at ₹4,600 apiece via open market route.
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.
This story is from the January 10, 2024 edition of Business Standard.
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