Bajaj Auto To Deliberate Further On Buyback Proposal, Stock Declines Over 5% Today

The board meeting of the auto company Bajaj Auto was lined up for considering buyback announcement. Nevertheless as per the exchange filing, the company shall deliberate further on the matter before taking any final call.

Bajaj Auto To Deliberate Further On Buyback Proposal, Stock Declines Over 5% Today

The release by the company said, "we wish to inform that, the Board of Directors of the Company at its meeting held today i.e. 14 June 2022, has decided that further deliberations are required in order to take a decision on the proposal of buyback, and accordingly deferred the matter".

Also, the company announced "we wish to inform you that Shri Shekhar Bajaj (DIN: 00089358) has
tendered his resignation as Non-executive Director of the Company with effect from close of business hours on 30 June 2022".

As per a CNBC TV 18 report which quotes sources the buyback plan is just deferred and not cancelled.

There is a belief and view by experts that the cash rich company shall announced a higher premium for the buyback as against the current market price.

Buyback is a corporate action in which the company buys back or repurchases its outstanding equity shares floated in the market from its shareholders at a premium. This is considered a tax-efficient way of rewarding investors.

At the closing as no call was reached on the buyback, the stock which was in action for quite a while after buyback announcement suffered heavy losses of 5%. The stock settled on the NSE at Rs. 3681.75 apiece.

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