Nucleus Software surges 16% as Board to consider share buyback plan

The company has scheduled its board meet on September 24 to consider the proposal

Shares of Nucleus Software Exports surged 16 per cent to Rs 612 on the BSE in Wednesday’s intra-day trade after the company said its board will meet on Friday, 24 September, 2021 to consider a proposal for share buyback. The stock of information technology (IT) software products company had hit a 52-week high of Rs 765.35 on 02 July, 2021.

“A meeting of the board of directors of the company will be held on Friday, 24 September, 2021 inter-alia to consider the proposal for buyback of the fully paid-up equity shares of the company,” Nucleus Software Exports said in an exchange filing on Tuesday after market hours.

The primary objective of a share buyback programme is to arrest the fall in the value of a stock by reducing the supply of the stock, which essentially pushes up the share price through a better Price to Earnings (P/E) multiple.

Despite today’s surge, in past three months, Nucleus Software Exports has underperformed the market by gaining 0.50 per cent, as compared to 12 per cent rally in the S&P BSE Sensex.

The company is leading provider of lending and transaction banking solutions to the global financial services industry. For the April-June quarter (Q1FY22), Nucleus Software had posted 83 per cent year on year and 78 per cent quarter on quarter drop in its consolidated net profit at Rs 6 crore. Total Revenue on a consolidated basis stood at Rs 108.44 crore for Q1FY22 as against Rs 128.35 crore in Q1FY21.

At 09:40 am; the stock was up 11 per cent at Rs 590 on the BSE, as compared to 0.20 per cent decline in the S&P BSE Sensex. The trading volume at the counter also jumped significantly with a combined 480,000 equity shares changing hands on the NSE and BSE.