Indian two-wheeler manufacturer Bajaj Auto has approved a Rs 4,000 crore share buyback program, its second such move within the span of a year.
The company will purchase shares at Rs 10,000 per share under the buyback plan cleared by its board on January 8th. This comes after Bajaj had bought back Rs 2,500 crore of its stock from shareholders in July 2022 at Rs 4,600 per unit.
Bajaj Auto MD Rajiv Bajaj stated last week that the latest buyback would be “far bigger” in size. He projected Bajaj to end financial year 2024 with Rs 20,000 crore cash balance after an “excellent” 2023 performance.
The announcement initially had minimal impact on Bajaj Auto’s stock price, which closed flat on Monday at Rs 6,980. But the stock has risen nearly 5% since and 93% over the past year, making it the second best Nifty 50 performer behind only Tata Motors.
The repeated buybacks highlight Bajaj Auto’s confidence in its strong cash position and intention to reward shareholders.