Bajaj Auto Shares Surge 6% to Hit One-Year High on Buyback Proposal

Explore the latest surge in Bajaj Auto shares, jumping 6% to reach a one-year high, driven by an upcoming buyback proposal. Get insights into the potential buyback size, expert opinions, and the company’s current stock performance. Stay updated on the latest financial developments.

Bajaj Auto Ltd witnessed a remarkable 5.96% surge in its shares, reaching a one-year high of Rs 7,059.75, a significant climb from its previous close at Rs 6,662.50. The surge is attributed to the company’s announcement, made in a BSE filing, regarding a proposed buyback of equity shares. The board of directors is scheduled to discuss and consider this proposal at the upcoming meeting on Monday, January 8, 2024.

Analysts speculate that this buyback might surpass the previous one, valued at Rs 2,500 crore. Prashanth Tapse, Senior VP (Research) at Mehta Equities, suggests a potential buyback in the range of Rs 7,800-Rs 8,000 per share, given the current market price of Rs 6,950.

On the stock exchange, BSE witnessed increased activity, with around 25,000 shares changing hands, exceeding the two-week average volume of 8,758 shares. The turnover on the counter amounted to Rs 17.22 crore, contributing to a market capitalization of Rs 1,97,788.32 crore. Notably, there were 54,318 buy orders against 8,833 sell orders.

From a technical standpoint, Bajaj Auto’s stock exhibits strength, trading above various moving averages, including the 5-day, 10-day, 20-day, 30-day, 50-day, 100-day, 150-day, and 200-day SMAs. The 14-day relative strength index (RSI) stands at 75.22, indicating a potential overbought condition, while the price-to-equity (P/E) ratio is at 29.34 with a price-to-book (P/B) value of 7.43 as of September 2023. The promoters continue to hold a significant 54.98% stake in the company.

Stay tuned for updates on Bajaj Auto’s buyback proposal and its impact on the stock’s performance.