Zydus Lifesciences Increases Share Buyback Price, Reduces Outstanding Share Count

Zydus Lifesciences Updates Share Buyback Programme with Revised Price and Share Count

On Wednesday, 27 May, Zydus Lifesciences announced revisions to its ongoing share buyback programme, including an increase in the buyback price and a reduction in the number of shares to be repurchased. According to the company, the buyback price has been raised to ₹1,260 per equity share from ₹1,150 per equity share earlier. The maximum number of equity shares proposed to be bought back has been lowered from 95.65 lakh shares to 87.30 lakh shares, representing up to 0.87% of the company's total paid-up equity share capital.

The buyback will continue to be carried out through the tender offer route at a total consideration not exceeding ₹1,100 crore, in line with the Companies Act, 2013 and the SEBI (Buy-Back of Securities) Regulations, 2018. This aligns with the company's previous announcement in May, which outlined a share buyback worth ₹1,100 crore. The board approved the repurchase of up to 95.65 lakh equity shares at ₹1,150 per share via the tender offer route.

Promoters are also set to participate in the buyback, with 29 May designated as the record date to determine shareholder eligibility. The buyback price represents a 16% premium over the company's closing price on Monday, 25 May.

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Share buybacks are commonly undertaken by companies to distribute excess cash to shareholders and improve capital allocation efficiency. They also reduce the number of shares outstanding in the market, which can potentially enhance shareholder returns over the long term.

The pharmaceutical major reported a 14.6% year-on-year (YoY) increase in consolidated net profit to ₹1,592.9 crore for the quarter ended March 31, driven by strong growth in its consumer wellness business. Revenue from operations climbed to ₹7,587 crore, compared with ₹6,527.9 crore in the corresponding period last year. Revenue from the pharma business stood at ₹5,643.6 crore, marking a 4.9% YoY rise, while the consumer wellness segment posted significant growth, with revenue surging to ₹1,463.3 crore from ₹908.1 crore a year earlier.

Zydus Lifesciences Share Price Trend

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Despite weak market sentiments, Zydus Lifesciences share price has remained positive. The pharma stock has gained over 5% in a week and 19.28% in a month. The multibagger pharma stock has delivered 19% gains on a year-to-date (YTD) basis and 17.44% in a year. The stock has given multibagger returns of over 114% in three years and 75% in five years.