Decision on IEX share buyback to be taken in board meeting today

• Share buyback, also known as share repurchase, is a corporate action to buy back its own outstanding shares from its existing shareholders

The Board of Directors of Indian Energy Exchange (IEX) is scheduled to meet today i.e. Friday to consider the proposal for buyback of equity shares of the company. Shares of IEX are down more than 43% so far in 2022 (YTD).

"A meeting of the Board of Directors of the Company is scheduled to be held on Friday, November 25, 2022, to consider a proposal for buyback of fully paid-up equity shares of the Company," Energy Exchange said. Informed in an exchange filing earlier this month.

A share buyback, also known as share repurchase, is a corporate action to buy back its own outstanding shares from its existing shareholders, usually at a premium to the prevailing market price. This can be an alternative tax-efficient way of returning money to shareholders. Share buybacks reduce the number of shares in circulation, which can increase share price and earnings per share (EPS).

Indian Energy Exchange is the major power exchange in India, which facilitates trading of electricity and commands 85-90% market share in the power exchange market.

IEX reported a decline of nearly 7% in its consolidated net profit at ₹71 crore in the September quarter, as compared to ₹77.38 crore in the quarter ended September 30, 2021, a year ago. Total income declined to ₹113.7 crore in the quarter under review, as compared to ₹122 crore in the same period a year ago.

Meanwhile, the total trading volume of energy swaps in the July-September quarter fell 11% to 23.1 billion units compared to the year-ago period, due to supply-side constraints. The total trading volume of IEX in July-September 2021 was 26 billion units (BU).

During the quarter, volumes declined by 11% YoY (Y-o-Y) as compared to Q2 FY22, impacted due to supply-side constraints, which led to higher prices of e-auction coal, imported coal and gas. There were prices.

“Going forward, easing of supply-side constraints and lower demand in the impending winter season, increased liquidity on exchange platforms are likely to ease prices, which will enable discoms to optimize their power purchases and commercial and industrial consumers. will provide an opportunity to To buy cheap power," the company said.