L&T plans to launch its first ever share buyback
₹9,000 crore at a price of ₹1,475 apiece. However, the plan had to be shelved in 2019 after the Securities and Exchange Board of India or Sebi disapproved the buyback over concerns that such a buyback could swell the company’s debts. The latest buyback proposal has come after the company turned debt-free last year.
L&T has not specified the amount of shares the company is planning to buy back from its shareholders. Neither did the firm mention about the mode of the share buyback. However, since the earlier buyback plan of 2018, the company’s paid-up capital has increased, stock price has gone up to ₹2,490 now, and shares worth over ₹3 trillion are currently held and traded by L&T’s public shareholders, according to BSE.
Therefore, the contours of the latest planned buyback may have to be revised. For FY2023, L&T has recorded a net profit of ₹12,531 crore, a 20.3% year-on-year jump as compared to FY2022 on a consolidated basis. In a bid to trim debts from the group’s balance sheet and unlock the real value of L&T’s stock, the conglomerate has been taking several business consolidation measures over the past two years.
In its latest move, L&T, on Thursday, announced that its board has approved the merger of two of its wholly owned subsidiaries - L&T Innovation Campus (Chennai) Ltd with L&T Seawoods Ltd. On 19 July, the board of directors of L&T Innovation Campus (Chennai) has approved a scheme of arrangement for a merger with L&T Seawoods. Following the amalgamation, L&T Innovation Campus will no longer be a subsidiary.
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