ONGC on Thursday said that its board of directors has approved the share buyback plan of 252,955,974 equity shares, or 1.97 percent of its total shares.

At the rate Rs 159 per share it would cost an aggregate of Rs 4,022 crore. The state-run refinery has set 4 January 2019 as the record date.

Shares of ONGC rose as much as 0.4 percent to Rs 148.80 a piece after the share buyback plan was approved.

Share buyback is repurchasing of shares issued by the company. The government has been pushing public sector undertakings for a share buyback or higher dividend payment to achieve its fiscal deficit target of 3.3 percent for 2018-19. The government is expected to garner Rs 2,714 crore from the share buyback. It is expected to raise Rs 5,000 crore from such buyback offers of state-owned companies like BHEL, Coal India and Oil India.

The Department of Investment and Public Asset Management (DIPAM) has set a target for the government to raise Rs 80,000 crore stake sales in PSUs. Cash-rich PSUs, that is those having a net worth of at least Rs 2,000 crore and a cash balance of more than Rs 1,000 crore have to mandatorily go in for share buyback. The government has raised a little over Rs 15,000 crore so far.