Aurobindo Pharma on Tuesday announced that its ₹800 crore share buyback offer will open from April 23. The company said in its regulatory filing that this offer will close on April 29. Earlier on April 6, the company’s board had approved buyback of a maximum of 54,23,728 fully paid-up equity shares of face value of ₹1 at a price of ₹1,475 per share. According to PTI news, this buyback will be done on a proportionate basis through the tender offer route. The company has set the record date as April 17, on the basis of which it will be determined which shareholders will get the right to participate in this buyback.
Buyback aims to give better returns to investors
According to the filing, this buyback represents approximately 3.93% (on standalone basis) and 2.62% (on consolidated basis) of the total paid-up share capital and free reserves (including securities premium) of the company, as shown in the audited financial data as of March 31, 2025. In a letter sent to shareholders, the company said that the purpose of this buyback is to give better returns to investors. Also, it is expected to improve over time in key financial ratios such as earnings per share (EPS) and return on net worth and assets. The company has also clarified that this buyback will not lead to any change in the management structure or control of the company.
What is share buyback?
Share buyback is a process in which a company buys back its own shares from investors. This purchase is done through tender offer or open market. When a company buys back its shares, the total number of shares available in the market reduces. Its direct benefit is that the stake of the remaining shareholders increases.
Along with this, the company also gives cash returns to its investors, which gives additional benefits to the investors. Companies typically try to reward their shareholders and improve the company’s financial ratios, such as earnings per share (EPS), through buybacks.
SK Sharma is a content writer who writes on news, entertainment, and lifestyle topics. She has over four years of experience and is known for conveying information in simple and clear language.
