L&T Boosts Share Buyback Price to ₹3,200 as Part of Lakshya '26 Strategic Plan
In a significant move that sent ripples through the stock market, Larsen & Toubro (L&T), the Indian engineering and infrastructure conglomerate, announced a revision in its share buyback price.
On Tuesday, L&T's share price surged by 3.6%, reaching a new 52-week high, as it adjusted the buyback price to ₹3,200 per share from the initial ₹3,000.
This adjustment reflects L&T's commitment to maximizing shareholder value and enhancing its return on equity (ROE), which are key components of its strategic plan, Lakshya '26.
L&T's share price began the trading session at ₹2,954.05 apiece on the Bombay Stock Exchange (BSE).
This upward momentum followed the company's announcement, made the previous day, in which it also disclosed a decrease in the maximum number of shares intended for buyback from 3.33 crore to 3.12 crore, equivalent to 2.22% of its equity capital.
The decision to revise the buyback price and limit the number of shares to be repurchased demonstrates L&T's commitment to creating additional value for its shareholders.
Lakshya '26, the company's strategic plan, has set the stage for initiatives that promote the return of equity capital to shareholders through share buybacks.
L&T made history when it announced its inaugural buyback offer on July 26, marking the first such initiative in the company's illustrious eight-decade-long history.
At the time of the announcement, the buyback offer price was set at ₹3,000 per share, representing a substantial 17% premium over the company's prevailing market price of ₹2,562.
However, since the initial announcement, L&T's stock has witnessed a remarkable recovery, reducing the premium and subsequently affecting the attractiveness of the planned buyback. During September alone, L&T's stock has experienced a robust 10% increase in value.
As of Monday's closing price of ₹2,894, the original buyback offer was only at a modest premium of 3.7%, which might have left shareholders contemplating whether to participate in the buyback.
Speaking on the matter, R. Shankar Raman, Whole-time Director & CFO of L&T, stated, "L&T is focused on enhancing its return on equity (RoE)." This move to revise the buyback price is clearly aimed at making the offer more appealing to the company's public shareholders.
The adjustment in the buyback price is not just a strategic financial decision but also a signal of L&T's commitment to delivering value to its shareholders as it continues to execute its ambitious Lakshya '26 plan.
This move underscores L&T's dedication to growth, innovation, and its shareholders' long-term interests. It will be interesting to observe how the market responds to this revised buyback offer and how it fits into L&T's broader vision for the future.