BSE approves share buyback of up to Rs 374 crore at 20% premium

The Board of BSE has approved a buyback proposal, under which the company will buy back shares worth Rs 374 crore. The buyback price is fixed at Rs 816 apiece, which is nearly a 20% premium from the current levels.

However, the buyback offer price represents a premium of 34.09% over the closing price on June 30, a day before, when the company informed about the board meeting to the exchanges.

"The board of directors of BSE considered and approved the proposal for buyback of fully paid up equity shares of the company having a face value of Rs 2 from all shareholders as on a record date," the company said in a filing.

The buyback will be executed through a tender offer route on a proportionate basis, using the mechanism for the acquisition of shares through the stock exchange.

The company will buy back about 45,93 lakh equity shares, representing 3.39% of the total equity as on March 2023.

The buyback offer size represents 25% and 19.64% of the aggregate of the company’s paid-up equity capital and free reserves as per the audited results for the financial year ended March 2023.

The board has also constituted a committee to oversee the process and appointed Vishal Bhat, Company Secretary and Compliance officer as the compliance officer.

Nuvama Wealth Management has been roped in as the manager of the buyback.

Under a share buyback, the company buys back its own shares from shareholders and it is seen as a tax-efficient way to give cash back to investors. Share buyback reduces the number of shares available in the market and thereby increases the real value of the stock.

BSE (formerly Bombay Stock Exchange) established is the world’s fastest stock exchange with a speed of 6 microseconds. In the March quarter, the company reported revenues of Rs 227 crore and a profit of Rs 88 crore in the said period.

On Thursday, following the announcement of the buyback, the stock was trading 0.43% higher at Rs 683.25 on NSE.