Bajaj Auto to consider share buyback, first such move after 2000

Bajaj Auto will consider a buyback of its fully paid-up equity shares, said the company in a notification to the exchanges on Thursday.

The move will be discussed in the meeting of the board of directors on June 14.

The company last went for such a move in 2000, when shareholders approved the buyback of up to 18 million equity shares at a price of Rs 400 each.

Bajaj has paid dividends to shareholders since FY08, with the amount going up each year: from Rs 20 per share in FY08 to Rs 140 at the end of FY22.

Its aggregate dividend payout during the same period has risen from Rs 289 crore to Rs 4,051 crore at the end of FY22, data from Capitaline shows.

The company's stock is down 8.2 per cent in the last one year. It has gained 19.3 per cent year-to-date.

Bajaj Auto shares closed at Rs 3,876.90 on the BSE on Thursday, up 2.21 per cent compared to Wednesday’s close.

Share purchases by companies and promoters are seen as a positive sign about the management’s confidence in the underlying fundamentals of the business.

While buybacks are common for IT companies, it’s rare for auto companies to opt for a buyback. Apart from Bajaj Auto, the last buyback one was done by Eicher Motors on 12 March 2009 for a proposed aggregate amount of Rs 97.46 crore fo 1.40 million shares.