Bajaj Auto’s smaller than expected buyback offer may fail to enthuse investors
Business

Bajaj Auto’s smaller than expected buyback offer may fail to enthuse investors

By Dan Neff

At Rs 4,600 per share, the buyback price is over 19% premium to the closing price of Rs 3,862.1 on Monday on the BSE.

Synopsis

The buyback is expected to increase the pre-tax return on capital employed (RoCE) by 100 basis points to 18% with a 2% likely rise in the projected earnings per share (EPS) for FY23. According to the Bloomberg consensus estimates, Bajaj Auto’s projected standalone EPS for FY23 is Rs 197 per share.

ET Intelligence group: Bajaj Auto’s share buyback worth Rs 2,500 crore may not appeal to investors since the offer size is significantly lower than the company’s cash reserve of Rs 19,090 crore at the end of March 2022 and therefore below the street’s expectations. In addition, since it will be an open market buyback and not through the usual tender route, analysts do not expect the stock price to reach to the buyback price level by the time the

BY

ET Bureau

3 mins read, Last Updated:

  • FONT SIZE

    AbcSmall

    AbcMedium

    AbcLarge

  • SAVE
  • PRINT
  • COMMENT

Why ?

  • Exclusive Economic Times Stories, Editorials & Expert opinion across 20+ sectors

  • Stock analysis. Market Research. Industry Trends on 4000+ Stocks

  • Clean experience with
    Minimal Ads

  • Comment & Engage with ET Prime community

  • Exclusive invites to Virtual Events with Industry Leaders

  • A trusted team of Journalists & Analysts who can best filter signal from noise

For all the latest Business News Click Here 

 For the latest news and updates, follow us on Google News. 

Read original article here

Denial of responsibility! TheDailyCheck is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected] The content will be deleted within 24 hours.

Dan Neff