In recent months, a significant trend has emerged among Indian companies: a rush to complete share buybacks before the critical deadline of October 1, 2024. This surge in buyback activity is driven by upcoming changes in tax regulations that will profoundly impact how these transactions are taxed. This article explores the reasoning of the uneasiness of the period, the introduction of the tax requirements, and the effects that it would bring to companies and the stockholders. Understanding Share Buybacks Share buybacks, or share repurchases, take place when a corporate entity purchases its own stock from the open market. This process involves offering to purchase shares at a specified price, often above the prevailing market value. The primary motivations for share buybacks include: Returning Excess Cash: Companies with surplus cash may choose to buy back shares as a way to return value to shareholders. Enhancing Financial Metrics: Reducing the number of shares outstanding can improve...