L&T Shares are up on first-ever Buyback plan
Indian engineering and construction giant Larsen and Toubro Ltd (L&T) is planning its first-ever share buyback offer in its 85-year history, witnessing a 3% increase in its shares on July 21, reaching an all-time high of ₹2,572.80.
The buyback proposal will be discussed during a board meeting on July 25, where L&T will also consider declaring a special dividend for its shareholders for the financial year 2023-24. The exact number of shares to be repurchased has yet to be revealed.
The last time L&T announced a 4.29% share buyback plan was five years ago, worth ₹9,000 crores at ₹1,475 per share, but it was canceled in 2019 after the Securities and Exchange Board of India (SEBI) shows the regulatory concerns about increasing the company's debt burden.
Since then, the company has taken measures to become debt-free, setting the stage for the current buyback plan.
Over the past two years, L&T has been working on consolidating its business and reducing debt from its balance sheet. Recently, the company's board approved the merger of two wholly-owned subsidiaries L&T Innovation Campus (Chennai) Ltd with L&T Seawoods Ltd. After the merger, L&T Innovation Campus will no longer operate as a separate subsidiary.
Investors are eagerly awaiting the outcome of the board meeting on July 25, hoping for positive news on the share buyback and the potential special dividend declaration. The record date for determining the entitlement of equity shareholders for the proposed dividend will be Wednesday, August 2, 2023.
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