Buy Back of shares

130 views 7 replies
How to know in advance that company will chose buy back option or not

Regards
Anup
Replies (7)
If company faces bankruptcy then company might call for buy back of shares
There's are many reasons like when they use cash on hand to buy and retire some of its own shares in the open market.

FOr a small company, shareholders can’t sell the shares, so it helps the share holders by buying back the share. For large companies, they buyback

when they have surplus cash from retained earnings

when a company wants to increase its eps 

when a company wants to increase gearing as debt will rise

when a company wants to prevent a take over

when a company is going through capital restructuring

 

Agree with yasaswi 😊
Buy back of shares is a different concept which is being resorted when the company wants to dilute the holdings.
Now it depends the share holding pattern of the company.
It's a decision by Board to go for buy back. NSE/BSE are informed about Board meeting and then about resolution passed. what do you mean by knowing in advance !! There are exchange restrictions on leak of such info. There are number of factors which are considered by management before such meeting and then announcement. SEBI NSE RBI etc have prescribed rules restrictions etc which are to be complied with.
Track background of companies, history , profit trend and investors interest


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register