Bajaj Consumer share buyback announced at premium. Key things to know

“The board of directors of Bajaj Consumer Care Limited at its meeting held today, i.e., December 9, 2022, has considered and approved the proposal for buyback of fully paid up equity shares of the company having a face value of Re 1/- (Indian Rupee One Only) from all shareholders/ beneficial owners of the Equity Shares of the Company, through the “open market” route, at a price not exceeding ₹240/- per Equity Share, for an aggregate amount not exceeding ₹8,089 lakh,” the company said.

The indicative maximum number of equity Shares proposed to be bought back at the Maximum Buyback Size and Maximum Buyback Price under the Buyback would be 33,70,416 Equity Shares (representing approx. 2.28% which is less than 25% of the total number of Equity Shares in the paid-up equity capital of the company as of March 31, 2022), Bajaj Consumer added.

“The Buyback Offer Size represents 9.66% and 10% of the aggregate of the Company’s fully paid-up equity capital and free reserves as per the latest standalone and consolidated audited financial statements of the company, respectively, for the financial year ended March 31, 2022, which is not more than 10% of the aggregate of the total paid-up capital and free reserves of the company,” the filing stated.

A share buyback, also known as share repurchase, is a corporate action to buy back its own outstanding shares from its existing shareholders usually at a premium to the prevailing market price. It can be an alternative tax-efficient way to return money to shareholders. Share buybacks reduce the number of shares in circulation, which can increase the share value and the earnings per share (EPS).

Bajaj Consumer Care is one of the leading FMCG brands in India with hair care and skin care products to consumers across the world. The stock is down about 8% in 2022 (YTD) so far.