Journal Press India^®

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The study examines which firm characteristics are associated with long-term share price performance of a firm’s decision to announce a share repurchase programme in Indian context. A sample of 77 buyback announcements of the period from 1999 to 2021 has been employed. The study makes a comparison between market-index and control-firm based index and reveals that buy-and-hold abnormal returns (BHAR) in both the methods is negatively associated with firm’s asset size, number of outstanding shares, and market-to-book ratio (MTBR). Leverage and promoters’ share holding yields negative relationship for control firm adjusted BHAR. Further, the long-term BHAR in both the methods is positively associated with profitability, operating cash flow (OCF) and percentage change in assets. Assets, MTBR and number of outstanding shares have negative coefficients in both the models.

Keywords

Share repurchase; Buyback; Firm peformance; Benchmark

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