Too Much Of A Good Thing

Reliance Infrastructure (R-Infra) announced on February 14, 2011 that it will implement the second round of its share buyback programme. It plans to spend maximum Rs1,000 crore on the buyback, while the maximum price it is prepared to pay is Rs 725 a share. The minimum number of shares that the company has committed to purchase is 34 lakh (which, at a maximum price of Rs 725 per share, will cost it Rs246 crore). On the other hand, the maximum number of shares it has committed to purchase is 1.37 crore. Post buyback scenario Post buyback, the company’s earnings per share (EPS) will get a boost of 5.4 percentage points. R-Infra will then have a Q3FY11 EPS of Rs 7.13 instead of Rs 6.77 as reported. Despite the buyback,