When you’re part of a buyback as a shareholder, you might get a tender offer. That means you have to give back some or all of your shares within a certain time. Companies buy back shares either gradually from the market or at regular times. They usually use cash they have or borrow money to fund the buyback.
Upcoming Buyback of Shares in 2024 & Current Buyback Share in India
Here is the list of upcoming buyback shares and current buyback shares in India on NSE and BSE.
| Buyback Stock Name | Company Logo | Record Date | Buyback Dates | Buyback Price |
|---|---|---|---|---|
| KDDL Buyback |  | Update Soon | Update Soon | ₹3700 |
| Bajaj Consumer Buyback |  | Update Soon | ₹290 | |
| Ajanta Pharma |  | 30 May, 2024 | – | ₹2771 |
| Tips Industries |  | 22 April, 2024 | 26 Apr – 3 May | ₹625 |
| Anand Rathi |  | 12 April, 2024 | – | ₹4450 |
| Freshtrop Fruits |  | 2 April, 2024 | – | ₹175 |
| Dwarikesh Sugar Industries |  | 20 Mar, 2024 | – | ₹105 |
| Shervani Industrial |  | 7 Mar, 2024 | – | ₹510 |
| Garware Technical |  | 12 Mar, 2024 | – | ₹3800 |
| Zydus Lifesciences |  | 23 Feb, 2024 | – | ₹1,005 |
| Kaveri Seed |  | 23 Feb, 2024 | – | ₹725 |
| Orbit Exports | 13 Feb, 2024 | – | ₹250 | |
| Rajoo Engineers | 31 Jan, 2024 | – | ₹210 | |
| Chambal Fertilisers | 18 Jan, 2024 | – | ₹450 | |
| Dhampur Sugar Mills | 17 Jan, 2024 | – | ₹300 | |
| Elegant Marbles | 5 Jan, 2024 | – | ₹385 | |
| Arnold Holdings | 25 Jan, 2024 | – | ₹21 |
What is the Buyback of a Stock?
A share buyback happens when a company decides to buy back its shares from the stock market. This reduces the number of available shares for investors.
Companies do this for various reasons. One big reason is to make the remaining shares more valuable. When there are fewer shares out there, each one becomes more valuable. So, it’s like the company is controlling its stock market presence by buying back its shares.
How does Buyback work?
Let’s understand the Buyback of stock in simple six steps…
- Decision: The company’s management decides that it wants to buy back some of its own shares. They might do this for various reasons, like boosting the value of remaining shares or using excess cash.
- Announcement: The company announces its intention to buy back shares publicly. This can affect the stock price, as investors may see it as a positive signal about the company’s prospects.
- Execution: The company starts buying back shares on the open market. It can do this through various methods, such as purchasing shares through a broker or a tender offer directly to shareholders.
- Payment: When the company buys back shares, it pays the shareholders the market price for those shares. This can provide shareholders with a cash return on their investment if they choose to sell their shares back to the company.
- Reduction of Shares: The bought-back shares are typically retired, meaning they are no longer outstanding. This reduces the total number of shares available in the market.
- Impact: With fewer shares available, the earnings per share (EPS) and other metrics can improve, potentially making the remaining shares more valuable. However, the impact on the stock price can vary depending on market conditions and investor sentiment.
Example of Buyback
Suppose ABC Limited is planning a buyback offer, proposing a price of Rs.1200, compared to the current market price of Rs.600. This means investors could receive a premium of Rs.600 per share over their holding price. Those who don’t already have the stocks in their Demat accounts can purchase them before the company’s set record date.
For reference see the list of upcoming buyback stocks.
FAQs of Buyback
What is a share buyback?
A share buyback, also known as a stock repurchase, is when a company purchases its own shares from the open market or directly from shareholders.
Why do companies engage in share buybacks?
Companies may buy back their own shares for various reasons, including boosting the value of remaining shares, signalling confidence in the company’s future, utilizing excess cash, or offsetting dilution from employee stock options.
How does a share buyback affect shareholders?
Share buybacks can benefit shareholders by potentially increasing the value of remaining shares through reduced supply. Additionally, shareholders who sell their shares back to the company during a buyback may receive a cash payment.
Are there any drawbacks to share buybacks?
Critics argue that share buybacks can sometimes be used to artificially inflate stock prices or benefit company executives with stock-based compensation, potentially at the expense of long-term investment in areas such as research and development or capital expenditures.