Buybacks are the process by which companies repurchase their shares from stakeholders.
Three companies – Emami, Dalmia Bharat and Motial Oswal Financial Services – have informed the stock exchanges that they will buy back shares in the open market.
While Motilal Oswal will make a buy-back offer of Rs 150 crore, Emami is planning for a buyback of over Rs 191 crore, and Dalmia Bharat will make an offer of Rs 500 crore, according to their BSE filings.
Buybacks are the process by which companies repurchase their shares from stakeholders. The bought back shares are extinguished shrinking the firms’ equity base.
Motilal Oswal will make the offer at a price not exceeding Rs 650 per share, while Dalmia Bharat’s offer will be at a price of Rs 700 per equity share. Emami is making the buyback offer at a price of Rs 300 per share. Motilal Oswal’s share price closed up 9.48% at Rs 605.60 on the BSE on Friday, while Dalmia Bharat’s share price closed up 5.06% at Rs 511.10. Emami’s share price on Friday closed up 6.83% at Rs 184.45 on the BSE.
In case of Motilal Oswal, the maximum buy-back size represents 7.51% and 6.64% of the aggregate of total paid-up equity share capital and free reserves, respectively, of the company based on the audited standalone and consolidated financial statements as on March 31, 2019. The company promoters will not participate in the offer.