Emami jumps 7% as board approves share buyback worth ₹282 cr

Emami's board approved a share buyback for an aggregate amount not exceeding ₹282 crore at a price not exceeding ₹475 per equity share, via the open market through the stock exchange mechanism.

Emami share price movement

 

Emami's share price moved higher by 7 per cent to ₹396.30 on the BSE in Thursday’s intra-day deals amid heavy volume after its board approved a buyback at a price not exceeding ₹475 per share via the open market.

 

At 12:22 PM, Emami quoted 4 per cent higher at ₹384.90, compared to a 0.38 per cent rise in the BSE Sensex. The trading volume at the counter jumped nearly three-fold compared to the two-week average, with a combined 8.6 million shares changing hands on the NSE and BSE.

 

Meanwhile, Emami’s stock underperformed the market in the recent past, with an 8 per cent decline in the past six months, against a 2 per cent fall in the BSE Sensex. In the past year, the stock slipped 36 per cent, compared to 10 per cent decline in the benchmark index. The market price of Emami corrected 35 per cent from its 52-week high of ₹612.40 touched on September 18, 2025.

 

 

Emami – Board approves share buyback

 

The Board of Emami, on Thursday, September 17, 2026, approved the buyback of the company's equity shares for an aggregate amount not exceeding ₹282 crore at a price not exceeding ₹475 per equity share, payable in cash, from its shareholders / beneficial owners (other than promoters, the promoter group and persons in control (and their associates)), from the open market through the stock exchange mechanism.

 

The indicative maximum number of equity shares proposed to be bought back at the maximum buyback size and maximum buyback price would be 5.94 million shares at ₹475 per share representing 1.36 per cent which is less than 25 per cent of the existing paid up equity capital of the company as of March 31, 2026 and approximately 1.36 per cent of the total paid-up equity share capital of the company as on the date of the Board Meeting, Emami said.

 

What is Share Buyback?

 

Share buyback or repurchase is the practice where companies decide to purchase their own shares from existing shareholders either through a tender offer or through an open market. In such a situation, the price of the shares concerned is higher than the prevailing market price.

 

When companies decide to opt for the open market mechanism to repurchase shares, they can do so through the secondary market. Alternatively, it can be looked at as a means to reward existing shareholders other than offering timely dividends.

 

However, company owners may have several reasons for repurchasing their stocks. According to ICICI Securities, individuals should make a point to find out the underlying causes to make the most of such decisions and benefit from them accordingly.

 

When a company decides to buy back its shares, it may also indicate that the company considers its shares to be undervalued. Besides serving as a remedy for the situation, it also helps to project a positive picture of the company’s prospects and its current valuation. Other than these, stock buybacks may be prompted to improve companies’ overall valuation or to reward their existing shareholders.

 

Emami – Company, Sector Outlook

 

The fast-moving consumer goods (FMCG) sector is expected to maintain steady growth over the medium term, supported by structural drivers, such as rising income levels, improving rural consumption and increasing adoption of digital commerce. The market is projected to grow at a compound annual growth rate (CAGR) of 16.64 per cent during 2026-2034 to reach approximately $1,150.21 billion by 2034.

 

Demand conditions are likely to see gradual normalisation as pricing adjustments across the value chain stabilise. Rural markets are expected to remain an important source of incremental growth, supported by income stability, infrastructure development and policy impetus. Urban demand may strengthen progressively as inflationary pressures ease and discretionary spending revives.

 

Input cost trends may remain subject to periodic fluctuations due to global developments, including geopolitical tensions affecting crude oil-linked inputs, along with movements in commodity prices and climate-related factors. While these factors may introduce near-term volatility, the sector’s inherent resilience and adaptability are expected to support long-term growth, Emami said in its FY26 annual report.

 

Meanwhile, in the April to June 2026 quarter (Q1FY27), Emami’s gross margin contracted sharply by 360bp year-on-year (YoY) to 65.8 per cent, impacted by high crude-linked input costs, a 200bp impact from the West Asia conflict and a 160bp drag from the changing business mix following acquisitions. Consequently, earnings before interest, taxes, depreciation, and amortization (EBITDA) margin declined 190bp YoY to 21.8 per cent despite healthy revenue growth, as the company continued to invest in brands while absorbing near-term cost pressure. 

 

Management expects calibrated price hikes, productivity initiatives and easing execution challenges to support margin recovery over the remainder of FY27. Analysts at Motilal Oswal Financial Services expect a 26 per cent EBITDA margin for FY27 and FY28.

 

Core domestic demand remains healthy with 8 per cent underlying volume growth. The strategic investment portfolio continues to scale up rapidly and should provide an incremental growth lever in the medium term. Although near-term margins are impacted by input cost inflation, management's calibrated pricing actions and productivity initiatives should aid a gradual margin recovery going ahead, the brokerage firm said in the Q1 result update. Disclaimer: Views and outlook shared on the stock belong to the respective brokerages and are not endorsed by Business Standard. Readers' discretion is advised.