Govt raises Rs 310 cr by tendering shares in EIL buy back: DIPAM Secy

New Delhi: The government has raised Rs 310 crore by tendering its shares in the buyback programme undertaken by Engineers India Ltd, Department of Investment and Public Asset Management Secretary Tuhin Kanta Pandey said on Tuesday.

"Engineers India buyback of shares fully subscribed. Government received Rs 310 crore out of total buyback size of Rs 587 crore," Pandey tweeted.

He said the government's stake in EIL is at 51.32 per cent.

For the current financial year ending March, the government expects to raise Rs 32,000 crore through disinvestment. The earlier target was to raise a record Rs 2.1 lakh crore through divestment. Shares of Engineers India closed 2.6 per cent lower at Rs 71.30 on the National Stock Exchange on Tuesday.

A buyback, also known as a share repurchase, is when a company buys its own outstanding shares to reduce the number of shares available in the open market.

Companies buy back shares for a number of reasons such as to increase the value of remaining shares available by reducing the supply or to return surplus cash to shareholders. The government wants public sector undertakings to either meet their targets for capital expenditure or "reward the shareholder in the form of a dividend" or share buyback.