In a smart move, the big shots at Bajaj Auto Ltd, known for two and three-wheelers, gave the green light to a hefty Rs 4,000 crore share buyback at a solid Rs 10,000 per share. This is a good 43 percent more than the last closing price.
They plan to grab 40 lakh shares through a tender offer, which is about 1.41 percent of all the shares Bajaj Auto has out there. And the big bosses, who own about 54.94 percent of the company, are jumping in too.
Bajaj Auto set up a Buyback Committee with the power to do whatever they think is necessary for the buyback.
But wait, it’s not a done deal yet. Shareholders have to give a thumbs up through a special resolution using a postal ballot. The dates and details are coming later.
This isn’t the first time Bajaj Auto is buying back shares. Last July, they picked up shares worth Rs 2,500 crore at Rs 4,600 each. Now, Rajiv Bajaj, the head honcho, says this buyback is going to be even bigger.
Bajaj Auto is on track to finish 2024 with a fat Rs 20,000 crore in the bank. They had a great 2023.
On January 8, the Bajaj Auto stock closed at Rs 6,980, pretty much the same as the day before. That’s better than the benchmark Nifty50, which dropped by one percent. Since the buyback news, the stock went up by almost 5 percent. In the last year, it shot up by a whopping 93 percent, making it the second-best on the index, just behind Tata Motors.
