Buybacks at all-time high of Rs 34,468 cr in 2016-17

With increase in tax on dividend payouts, buybacks emerging as alternative to reward shareholders

Share buybacks by listed companies have hit an all-time high during FY17. A total of 45 companies launched share repurchase programmes this financial year totalling Rs 34,468 crore. Interestingly, the amount is more than the combined buybacks in the preceding seven years.

The new higher dividend tax regime and government increasingly opting for the buyback route for divestments are the two key reasons behind this sharp rise in buybacks during the current financial year, market participants said.

The government had introduced the concept of additional dividend tax (ADT) from April 1, 2016. According to it, dividend received in excess of