Bajaj Auto defers share buyback proposal, says more deliberations required

India's leading two-and-three-wheeler company Bajaj Auto on Tuesday said that it has deferred the proposal of share buyback, which was anticipated to be announced today. 

The announcement came after the Board of Directors met earlier today, wherein it was decided that further deliberations are required in order to take a decision on the proposal of buyback, and accordingly deferred the matter, Baja Auto informed in a regulatory filing. 

On Tuesday, Bajaj Auto shares gave up initial gains in choppy trade. The Bajaj Auto stock fell by as much as Rs 117.6 or three per cent to Rs 3,763 apiece on BSE, having begun the day marginally in the green at Rs 3,890. It is currently trading 6.26 per cent lower at Rs 3,637.55 apiece on BSE during late-trade hours.

What is share buyback?

A buyback, also known as a share repurchase, is when a company buys its own outstanding shares to reduce the number of shares available on the open market.

Companies buy back shares for a number of reasons, such as to increase the value of remaining shares available by reducing the supply or to prevent other shareholders from taking a controlling stake.