Bajaj Auto Buyback: Homegrown motorcycles and three-wheeler manufacturer Bajaj Auto informed that its board will meet on Monday, June 27, 2022, to further deliberate on the proposal for buyback of fully paid-up equity shares of the company. “We wish to inform you that a meeting of the board of directors of the company is scheduled to be held on June 27 to further deliberate on the proposal for buyback of fully paid-up equity shares of the company,” Bajaj Auto said in an exchange filing on June 22.
The price and other details of the buyback will be revealed after this meeting.
Earlier, the company had deferred the buyback plan in a meeting held on June 14. “We wish to inform that the board of directors of the company at its meeting held on June 14, decided that further deliberations are required in order to take a decision on the proposal of buyback, and accordingly deferred the matter,” it had said while postponing the buyback plan.
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).
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 Auto Dividend
In a release, the auto company also announced the distribution of dividends to its investors at the rate of Rs 140 per share. “In line with the company’s Dividend Distribution Policy, the Board of Directors has approved/recommended a dividend at the rate Rs. 140 per share (1400 percent) of the face value of Rs 10 each on equity shares for the financial year ended March 31. The said dividend, if declared by the shareholders at the ensuing Annual General Meeting, will be credited/dispatched on or around July 30,” Bajaj Auto notified about dividend payment.
“The dividend, if declared, shall be paid to the equity shareholders whose names appear on the Register of Members of the Company or in the records of the Depositories as beneficial owners of the shares as on July 1, which is the record date fixed for the purpose,” it said.
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.
Bajaj Auto Q4 Results
Bajaj Auto Ltd reported 10 per cent growth in net profit for the March 2022 quarter at Rs 1,469 crore as against Rs 1,332 crore in the corresponding quarter of the previous fiscal. The higher profit was mainly due to an exceptional item of Rs 315 crore accrued as an incentive receivable from the Maharashtra government under an incentive scheme.
Revenue from operations, however, fell 7 per cent to Rs 7,975 crore for the period under review. The company’s EBITDA (earnings before interest, tax, depreciation and amortisation) fell 10 per cent to Rs 1,396 crore, while margins shrank to 17.5 per cent. Bajaj Auto reported a marginal growth in its total vehicle sales at 2,75,868 units in May, as against 2,71,862 vehicles sold in the year-ago period.
Bajaj Auto Stock Price History
In the last session, the scrip closed at Rs 3,824.50 up by 1.05 per cent. Shares of Bajaj Auto have gained over 14 per cent in 2022 (YTD) so far, whereas the auto stock is down about 11 per cent in a year’s period.
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