L&T Shares Hit 52-Week High After Company Raises Its Share Buyback Price To Rs 3,200; Details Here

Larsen and Toubro (L&T) share price jumped over 3.6%, touching a 52-week high on Tuesday’s trading session at Rs 2,997.75 per piece. This happened after the engineering and construction giant announced a surge by 7% in its share buyback price from Rs 3,000 to Rs 3,200 per share in its 10,000 crore mega buyback programme.

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On Monday, the company said in an exchange filing that it has also decreased the maximum number of shares planned to be bought back from 3.33 crore to 3.12 crore, representing 2.22% of the equity capital.

It further said that the main goal ‘Lakshya’ of the company is improving its return on equity (ROE) and maximising shareholder value, which is its strategic plan. One move in that direction involves returning equity capital to shareholders by repurchasing company shares.

“L&T is focused on enhancing its Return on Equity (RoE). In fact, one of the core objectives of the company’s five-year strategic plan ‘Lakshya 2026’ is to maximise shareholder value through improved RoE,” R Shankar Raman, Whole-Time Director & CFO, L&T, said.

In July this year, the engineering giant had announced the buyback—the first such offer in its eight-decade-long history. It had said it may offer to buy back a 2.4% stake, or 3.33 crore of shares, held by public shareholders through a book-building process on the stock exchange.

The buyback offer price was Rs 3,000, at the time of announcement, which represented a 17% premium over the company's then-current market price of Rs 2,562.

As per media reports, the L&T stock has significantly bounced back, diminishing this premium and lowering the probability of shareholders tendering their shares in the proposed buyback. In September alone, the stock surged by 10%.

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As per trendlyne data, L&T stock price rose 51.4% and outperformed its sector by 0.1% in the past year.