Bajaj Auto has announced that it will consider a buyback of its fully paid-up equity shares at its board meeting on May 6, 2026. This will be the second buyback in the past two years, following a buyback conducted in March 2024. When approved, this will be the fourth buyback by Bajaj Auto.
Flush with Funds
As of the end of the nine months in FY26, the company has surplus funds totalling Rs 15,000 crore. This was after distributing Rs 5,864 crore in dividends and investing Rs 2,300 crore in its subsidiaries, partially to fund the KTM Austria transaction and to support the expansion of its financing business. During the first nine months of FY25, Bajaj Auto generated free cash flow of Rs 5,200 crore, a 70% increase year-on-year.
Legacy of Repurchases
In January 2024, the Bajaj Auto board approved a proposal to buy back up to 4,000,000 fully paid-up equity shares at Rs 10,000 per share, on a proportionate basis, amounting to Rs 4,000 crore through a tender offer process. The buyback opened on March 4, 2024, and closed on March 13, 2024.
The total outlay for this buyback was Rs 4,932 crore, resulting in the purchase of 1.41% of the company's equity. As of March 31, 2024, Bajaj Auto had surplus funds of Rs 16,386 crore and paid out Rs 8,900 crore to shareholders that year through dividends and share buybacks.
The earlier buyback was conducted in June 2022, worth Rs 2,500 crore through an open-market buyback, during which the company repurchased 5.4 million shares, representing approximately 9.6% of the paid-up capital. Additionally, in 2000, Bajaj Auto repurchased 18 million equity shares-15% of the paid-up capital-at Rs 400 per share, involving a total expenditure of Rs 720 crore.
Report by FinancialExpress
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