The buyback price of Rs 600 per share was short of market expectations of a buyback price of Rs 700 a share. The buyback price of Rs 600 each is 20.46% premium over the ruling market price. The buyback is through the tender offer route.

The company announced the buyback plan along with Q2 September 2010 results after market hours on Friday, 22 October 2010.

Meanwhile, the BSE Sensex was up 265.09 points, or 1.31%, to 20,430.95.

On BSE, 2.73 lakh shares were traded in the counter as against an average daily volume of 18.07 lakh shares in the past one quarter.

The stock hit a high of Rs 509 and a low of Rs 485.65 so far during the day. The stock had hit a record high of Rs 599.90 on 21 May 2010 and a 52-week low of Rs 331 on 28 January 2010.

The stock had outperformed the market over the past one month till 22 October 2010, gaining 1.89% compared with the Sensex's 1.12% rise. It had, however, underperformed the market in past one quarter, moving up 2.17% as against 11.33% rise in the Sensex.

The large-cap drug maker has an equity capital of Rs 41.80 crore. Face value per share is Rs 2.

Piramal Healthcare said in a statement that its board opted for the share buy-back as it was more tax efficient compared with the other alternatives such as dividend/bonus issue. The company has proposed to buy back a maximum of 4.18 crore shares. The buyback, estimated to cost Rs 2510 crore, will be completed by February 2011.

Net profit of Piramal Healthcare surged 10,905.06% to Rs 12,569.98 crore on 23.82% decline in net sales to Rs 537.49 crore in the quarter ended September 2010 over the quarter ended September 2009. The company had net extraordinary income of Rs 16,209.90 crore in the quarter ended September 2010 and net extraordinary expense of Rs 0.36 crore during the previous quarter ended September 2009.

On a consolidated basis, net profit surged 11,700.5% to Rs 12,540.44 crore on 26.3% decline in net sales to Rs 731.41 crore in Q2 September 2010 over Q2 September 2009.