Bajaj Auto, Chambal Fertilisers’ boards to meet on Monday to mull share buyback
Bajaj Auto and Chambal Fertilisers & Chemicals will be in focus on Monday, January 8, when the market resumes trade as the boards of the companies will meet to consider and approve buyback of shares.
Both Bajaj Auto and Chambal Fertilisers had informed about the meetings and buyback proposals on Wednesday, January 3.
While Bajaj Auto's shares have gained 5% since the announcement, Chambal Fertilisers' share price has dropped by 3.4%.
On Friday, shares of the two-wheeler stock settled at Rs 6,995.90 on the NSE, up 1.07%, while those of Chambal finished at Rs 373.20, down 3.48%.
Bajaj Auto share buyback
If the board of directors of Bajaj Auto approves the buyback of shares, then it will be the second instance of the company buying back its shares in the last two years.
The Nifty company which boasts of Pulsar and Chetak brands had undertaken a buyback in July 2022 at Rs 4,600 per equity share. The previous Bajaj Auto buyback size was Rs 2,500 crore, which represented 9.61% and 8.71% of the aggregate of the total paid-up share capital and free reserves of the company, respectively.
Bajaj Auto shares have delivered returns of over 90% in the last 12 months which is higher than 45% returns given by the Nifty Auto index. Meanwhile, the broader Nifty has given returns of 21% during this period.
The stock is currently trading above its 50-day and 200-day simple moving averages (SMAs) and the recent price action has brought it into an overbought zone. Stock's MFI and RSI are 73.4 and 81.8, respectively as reported by Trendlyne. A number above 70 is considered as overbought while below 30 is oversold.
Meanwhile, Chambal Fertilisers shares have underperformed Nifty with nearly 19% returns over a one-year period.
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