MP Evans Group PLC (AIM:MPE), a producer of sustainable Indonesian palm oil, said it intends to commence a £2mln share buyback programme.
All shares bought under the programme, which starts today, will be cancelled, according to a statement.
The company said it believes the current share price of 760p undervalues its assets, performance and future prospect.
MP Evans said its robust balance sheet provides it with an opportunity to take advantage of market conditions and repurchase shares at a level that will be earnings enhancing.
Commencing the buyback is part of a disciplined capital allocation approach, it said, which includes investment across its estate, strategic acquisition opportunities and payment of dividends.
Peel Hunt will carry out on-market purchases of its 10p shares, and the board will keep the programme under review before making a decision on whether to extend it.