Buyback of equity shares of the company. what does it mean?

Question

DLF said its board will meet on 10 .7.8 to consider proposal for buyback of equity shares of the company. what does it mean.i hav 100 share at 525

Answer 1

It just means it will buy back shares.  Equity means your typical shares, there are other securities such as bonds and what not.  It usually means your shares will go up, because the supply of the shares will shrink and the demand will theoretically remain about the same.  This move is usually done when they believe their shares are undervalued in the open market.

Answer 2

Generally, a share buyback is good news for that company's shareholders. It means that the company's management thinks that the prices at which the stock is trading are too low.

Sounds like your company intends to take some of its cash on hand (or borrow some money) and buy back some of its shares on the open market.

there are no guarantees, but when companies do this, they usually effectively place a floor under the price of the stock - if you thought the company was willing to buy at $20, why would you sell for $19?

Good luck...

Answer 3

I found no trading symbol for DLF

http://finance.yahoo.com/lookup?s=dlf

Where does it trade? Country or stock market?

General.

Buy backs can prob up a stock a little. A company is not required to buy back any or all of the shares a board authorized to buy back. EK (NYSE Listed) recently announced a buy back and their shares soared before 1 share was even bought back by the company.

I would not read too much into this.