NEW DELHI: It seems to be the season of companies rewarding their shareholders. Some are announcing big dividends while others are preferring to buy shares at a massive premium to the prevailing share prices.

UPL has joined the bandwagon announcing share buyback to the tune of Rs 1,100 crore, at a price of Rs 845. This means the company will be buying 1,25,71,428 shares or 1.65 per cent of total outstanding shares.

The buyback price would be at a 23 per cent premium to Wednesday prices. Sensing the opportunity, traders on Thursday rushed to buy the stock wishing to capitalise on the offer.

Shares of UPL eventually ended up 4.47 per cent to Rs 720.35.

Inflation woes

Shares of cement companies were under severe selling pressure on Thursday as prices of raw materials it uses to make cement surged significantly. Traditionally, fossil fuels such as coal, fuel oil, petroleum coke, natural gas, or diesel are used in the cement industry in the kilns.

Crude oil prices have seen massive rise in the last two weeks given supply disruption due to the Russian invasion of Ukraine. Prices of other commodities have also followed upwards, making almost everything costlier for companies.

Higher raw material prices mean further squeezing of margins for cement makers. Thus they fell up to 8 per cent during the day. Ultratech Cement, the most valuable cement company, tanked 7 per cent.

Shares of other companies that use oil in production of materials also saw selling, Asian Paints was down over 5 percent, while Grasim slumped nearly 3 per cent.

Attractive bets now?

As the energy prices have surged, the outlook for many stocks has turned negative; but there are some names that are having a blast (no pun intended) during the war in Eastern Europe.

ONGC, which bores wells to extract oil and gas across the world, was the top gainer. It rose nearly 5 per cent in Mumbai trading. Mining company Coal India shares also climbed as coal prices have seen a rally.

Even shares of downstream oil companies Bharat Petroleum and Indian Oil saw buying on Thursday.


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