SEBI vide its Circular dated 8th March, 2023 referred to Securities and Exchange Board of India (Buy-Back of Securities) (Amendment) Regulations, 2023 which were notified on 7th February, 2023. They shall come into force on 30th day of the date of notification i.e. 9th March, 2023.
Further, all buy-back offers where the Board of Directors of the company approve resolution with respect to Buy-back on or after 9th March, 2023 the above mentioned Regulations shall be applicable.
Following restrictions set-out for the companies undertaking buy-back through stock exchange route:
- The company shall not purchase more than 25% of the average daily trading volume (in value) of its shares or other specified securities in the ten trading days preceding the day in which such purchases are made.
- The company shall not place bids in the pre-open market, first thirty minutes and the last thirty minutes of the regular trading session.
- The company’s purchase order price should be within the range of ±1% from the last traded price.
- Margin Requirement for deposits in Escrow Account the escrow account shall consist of cash and/or other than the cash.
This Circular is applicable to all Listed Entities, Recognized Stock Exchange, Registered Merchant Bankers and shall come into force from 9th March, 2023
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