Shares of Emami rose 7% to Rs 369.45 on the BSE in intraday trade on Wednesday after the personal care company announced a buyback plan.

Emami said in an exchange filing that the company’s board of directors is scheduled to meet on Friday, March 24, 2023, to propose a buyback of fully paid equity shares.

The main goal of a share buyback is to stem the decline in stock value by reducing the supply of shares, which essentially drives up the stock price through a better price-to-earnings (P/E) ratio.

Emami’s share price hit a 52-week low of Rs 340.95 on Monday, March 20, 2023. Meanwhile, the stock has fallen 16% over the past three months, with a 4% drop for the S&P BSE Sensex. Moreover, it has lost 30% over the past six months, compared with a 1.5% decline in the benchmark index.

Emami is one of India’s leading Fast Moving Consumer Goods (FMCG) companies engaged in manufacturing and marketing personal care and healthcare products.

According to analysts, volume growth remains a cause for concern for Emami, although the base could turn better going forward.