Balrampur Chini rises 3% as share buyback begins

16 Nov 2022 , 11:43 AM

Following the start of the share repurchase today, shares of Balrampur Chini Mills traded 2% higher at Rs 355 in Wednesday's intraday trade on the BSE. The sweetener stock has increased in price for three days in a row, increasing 8% in that time. At their meeting on November 9, the board of directors of Balrampur Chini approved a share repurchase through the open market for Rs 145.44 crore at Rs 360 per share.

The management is certain that the buyback would benefit shareholders over the long term. According to Balrampur Chini, the buyback is unlikely to have a significant influence on the company's profitability or earnings other than to reduce the investment income that would have otherwise been made on the money distributed for the buyback.

The company's capacity to pursue expansion prospects or meet its cash needs for ongoing capital expenditure, as and when necessary, or for business operations won't be hampered by the buyback, it was stated. Despite a recent run-up over the previous three trading days, the Balrampur Chini underperformed the market over the past six months, declining 14% as opposed to the S&P BSE Sensex's 17% gain.

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