ANALYSING THE BUYBACK OF SHARES IN INDIA

Buyback of shares have gained great prominence in India after the Amendment to companies Act in 1999, which allows companies to repurchase their own shares. This kind of strategy tries to restrict and limit share supply in the market, perhaps stabilizing or increasing prices, but their effectiveness varies greatly, raising concerns about their underlying worth. This paper analyses the reason for buybacks, including their influence on market value. Though buybacks can increase shareholder value, companies must balance this approach with long-term investments to avoid masking underlying financial issues.