New Delhi (Anish Yande): The share prices of GAIL India rose by more than 5 percent on Tuesday's trading session. GAIL India, one of the leading gas distribution companies, recorded a rise in its shares after the company's board announced its plans for a share buyback. The company's shares rose to an intraday high of Rs 143.50.
The shares of the gas distribution company opened at a high of Rs 140.35 on the NSE. The shares of GAIL India were trading at Rs 141.50 at 10.30 AM. The buyback plan, which is also known as a share repurchase, is executed by a company to lessen the number of shares in the markets.
Board of GAIL India to consider share buyback plan:
The company could be executing a buyback share plan to return surplus cash of the shareholders or for increasing the value of remaining shares.
GAIL India stated in an exchange filing that the company's board would be considering a share buyback plan and the payment of interim dividend. The company's board would be meeting on January 15th, 2021. The board would be considering launching the payment of the interim dividend in the fiscal year ending in March 2021.
Indian government plans disinvestment for its PSUs:
The Indian government holds a 52.1 percent stake in GAIL and public shareholders in GAIL India hold 47.89 percent of the stake in the company. The government has requested state-run companies to consider share buyback plans for raising funds.
Firms such as Coal India, NTPC, and NMDC were asked to consider share buyback plans.
The government would be utilizing the funds to address the fiscal deficit in India.
The Indian government has requested its PSUs to meet its capital expenditure targets. Alternatively, the government has requested to reward the shareholder through a dividend or share buyback plan.
The Indian government has raised more than Rs 28 thousand crores from the disinvestment proceeds. The government raised Rs 1065 crore from the share buyback plan in NTPC. Funds amounting to Rs 14,453.77 crore as dividend from state-owned companies were acquired by the Government.
Image Credit: Google
Get Breaking News First and Latest Updates from India and around the world on News24. Follow News24 and Download our - News24 Android App. Follow News24 on Facebook, Telegram, Google News.
