Shares of Bajaj Auto Ltd (BAL) on Wednesday hit a new high after the company said its board will meet on January 8 to consider a proposal to buy back shares.

“The board of directors of the company at its meeting scheduled to be held on Monday, 8 January 2024, inter-alia will consider a proposal to buy back fully paid-up equity shares of the company,’’ the two-wheeler major said in a regulatory filing.

The company said the trading window for dealing in securities or equity shares has been closed for all designated persons and their relatives from January 1, 2024.

It will remain closed till the outcome of the declaration of financial results for the third quarter ended December 31, 2023, till January 26.

The announcement led to BAL shares touching a new peak in an otherwise weak market where the Sensex slumped nearly 586 points.

After opening marginally higher at Rs 6,664.05, the share soared almost six per cent to hit an intra-day high of Rs 7,059.75.

It subsequently ended at Rs 6,989.40 — a rise of Rs 326.90 or 4.91 per cent over the last close.

In a buyback, a company acquires its own shares from the market or from shareholders, which are subsequently extinguished. It improves earnings per share, supports the share in poor market conditions and helps return surplus cash to shareholders.