Buy Back Pushes Reliance Energy Up
Reliance Energy rose 1.66% to Rs 1274.20 at 15:12 IST on BSE extending recent gains. The scrip had touched a high of Rs 1308 and a low of Rs 1261.10 so far during the day. The stock had hit a 52-week high of Rs 2631.70 on 10 January 2008 and a 52-week low of Rs 496 on 13 April 2007. The scrip had underperformed the market in the one month to 10 April 2008, falling 5.64% as against the Sensex’s 10.03% fall. It had also underperformed the market in the past three months, slipping 49.58% against the Sensex’s 47.90% slide. The company said on 9 April 2008 it had so far bought back 20.38 lakh shares aggregating to Rs 250.75 crore in a buyback programme that it had started recently.
Earlier, Reliance Energy’s board had approved the buyback of shares worth about Rs 800 crore in the first phase. The firm has allotted Rs 1,200 crore for the second phase of buy back. With Rs 2000 crore allocated for buyback, the company could purchase around 1.25 crore shares from the open market if the buyback is done at maximum price of Rs 1600 per share. This will raise promoter’s stake by 1.5% to 37% of the reduced equity base as shares bought back are to be extinguished.
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