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ONGC rebounds 6% from day's low as board mulls share buyback

The stock moved 5% higher to Rs 150, bouncing back 6% from the intra-day low of Rs 141, after the company said that its board will meet on December 20 to consider a share buyback proposal.

SI Reporter  |  Mumbai 

ONGC
ONGC

Shares of Oil and Natural Gas Corporation (ONGC) have moved higher by 5% to Rs 150, bouncing back 6% from the intra-day low of Rs 141 on BSE, after the company said its board will meet on Thursday, December 20, 2018, to consider a proposal.

“The meeting of the board of directors of the company is scheduled on 20/12/2018, inter alia, to consider and approve the proposal for buy-back of the fully paid-up equity shares of the company,” said in a regulatory filing.

The government, which holds a 67.48% stake in ONGC, is expected to participate in the

The government is targeting a minimum Rs 50 billion through offers of state-owned firms like Coal India, and Oil India. Besides Indian Oil Corporation (IOC), at least half a dozen other central PSUs have disclosed share buyback programmes. Prominent among these include NHPC, BHEL, NALCO, NLC, and that could fetch the government a little over Rs 30 billion.

The primary objective of 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 P/E multiple.

The stock of hit a 52-week low of Rs 135 on December 11, 2018, has fallen 37% from its 52-week high level of Rs 213 on January 25 this year. Thus far in the calendar year 2018, underperformed the market by declining 26% against 5.5% rise in the S&P Sensex till Thursday.

At 02:27 pm, ONGC was trading 4% higher at Rs 149 on BSE, against a 0.03% decline in the benchmark index. A combined 15.82 million equity shares changed hands on the counter on the and so far.

First Published: Fri, December 14 2018. 14:30 IST
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