REL to consider share buyback

In a move aimed at arresting the slide in its scrip and reassure investors about the growth potential...

In a move aimed at arresting the slide in its scrip and reassure investors about the growth potential, Anil Ambani group’s Reliance Energy Ltd (REL) on Tuesday said it will consider buyback of shares at a meeting next month.

“A meeting of the company’s board of directors will be held on March 5 to consider buyback of equity shares of the company,” Reliance Energy said in a communique to the Bombay Stock Exchange. The company, however, did not reveal how many shares it proposes to buyback or at what price. When contacted, an ADAG spokesperson declined to reveal the purpose of the buyback.

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Shares of Reliance Energy were trading at Rs 1,682, up 3.65 per cent from Monday’s close of Rs 1622.70. The scrip, which had closed at Rs 1,963.25 on February 8, has taken a beating since its listing on February 11.

“The significance (of the buyback) is that promoters are sending a message to investors that they are bullish about the business and they don’t see the rate of shares going down below that level,” Globe Capital Market MD Ashok Aggarwal said.