GAIL (India) Ltd. approved a buyback of equity shares as well as declared an interim dividend for the ongoing fiscal at its board meeting.
The state-owned gas distributor will buy back 6.97 crore shares, representing 2.5% of the total paid-up equity share capital, of face value of Rs 10 each, according to an exchange filing. That amounts to a total consideration not exceeding Rs 1,046.35 crore.
The buyback price has been fixed at Rs 150 apiece, a 4.1% premium to Thursday's closing price.
GAIL also declared an interim dividend of Rs 2.5 apiece for FY21. The board has fixed Jan. 28, 2021 as the record date for buyback and dividend.
According to the company's latest shareholding, the government held a 51.76% stake in the company, while foreign investors owned 15.74%.
Shares of GAIL fell as much as 5.2% to Rs 136.55 after the announcement, but recovered from the day's low. Of the 39 analysts tracking the company, 35 have a ‘buy' rating and four suggest a ‘hold'. The stock is trading 6% higher than its Bloomberg consensus 12-month price target of Rs 135.6.
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