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Bajaj Auto Ltd Stock price: Bajaj Auto’s smaller than expected buyback offer may fail to enthuse investors- Newshubweek

Bajaj Auto Ltd Stock price: Bajaj Auto’s smaller than expected buyback offer may fail to enthuse investors- Newshubweek
Written by Arindam

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

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Arindam

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