Reliance Industries (RIL) has begun its share buyback programme on Wednesday. As per the announcement on January 20, RIL will buy shares worth up to Rs 10,440 crore, with a cap on the purchase price at Rs 875 a share, to bring down the floating stock.

Citigroup Global Markets India, DSP Merrill Lynch and HSBC have been mandated as advisors for the buyback, RIL told stock exchanges on Wednesday.

Details of the first-day buyback will be available on the Bombay Stock Exchange and National Stock Exchange on Thursday.

RIL shares closed at Rs 830.30 a piece on Bombay Stock Exchange. The stock has rallied more than 20 per cent after it touched a 52-week low of Rs 687.55 on January 2.

However, market experts and analysts said the company would rather wait for a better time to really go ahead with the buyback on a full swing as the stock has strengthened above Rs 800 a share over the past two weeks. “RIL will use the opportunity to buy back shares to strengthen its stock only if it falls below the Rs 800 level,” said SP Tulsian, an RIL watcher and owner of Mumbai-based brokerage Premium Investments.

AK Prabhakar, senior vice-president at Anand Rathi, said the stock has performed well over the past two weeks on better market sentiment as it took the advantage of higher weightage on benchmark Sensex and Nifty. “A number of FIIs bought into exchange-traded funds on Nifty, where RIL has 9 per cent weightage and has been a beneficiary of the overall market sentiment. Also, the gross refining margin on the Singapore Index has improved over the past two weeks, which has helped RIL shares.”

However, the stock is expected to correct after the elections, Prabhakar said. But Tulsian said it might happen much earlier, may be next week. “That would be the time when RIL would look to buy back shares to strengthen the stock,” Tulsian said.

As per the plan announced on January 20, RIL would buy up to 12 crore shares (around 7.22 per cent of total paid-up capital) from open market largely to help investors gain efficient returns on cash in a “highly tax-efficient process.”

According to Sebi guidelines on buyback, RIL will have to purchase a minimum of 25 per cent of the announced buyback or shares worth close to Rs 2,610 crore over a year. Besides, shares purchased have to be exhumed within seven days at the end of the buyback offer. Experts are cautious on the overall outlook for the stock.