Shares of Indiabulls Ventures and Indiabulls Real Estate rallied up to 10 per cent after the two announced their respective share buy-back plans, in a likely bid to arrest steep fall in the share prices. The market value of their share has fallen sharply in the past one month.
“A meeting of the board of directors of the Company will be held on Friday, October 11, 2019, to consider, the proposal of buy-back of equity shares of the company,” Indiabulls Real Estate and Indiabulls Ventures said in a separate regulatory filing.
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.
In the past three months, shares of Indiabulls Real Estate and Indiabulls Ventures have tanked 64 per cent and 63 per cent, respectively. In comparison, the S&P BSE Sensex has shed 3 per cent during the same period till Monday.