You are absolutely right! The pre IPO shares were locked in for 1 year and it got unlocked earlier during February 2018. The board took notice of the situation and approved the buy back at a very opportune time - when the free float was expected to increase significantly.
Considering BSE is not allowed to have a promoter group - the long term holders can exit at any point in time. Boards decision to buy back should have ideally protected any downward risk - but surprisingly in this case it is working out in a totally different pattern with price falling by more than 15% from the time buy back was announced and now the delta between the approved buy back price and market price is in excess of 25%. I guess either we are not aware of ‘something not so good’ which is cooking in the background(and a few big investors who are selling now are aware of it!) or just that this company is having few large investors who are in desperate need for money and ready to liquidate at what ever price they can get.
Small share holders are the real beneficiaries when the company has a reasonable number of strong and deep pocketed investors who hold significant majority of the shares through thick and thin(indirectly creating scarcity premium in market) - TCS, Maruti, HDFC, DMart etc good reference points for this. Hope BSE is able to attract the attention of quality investors investors soon.
Disclosure: Invested in BSE and have added during the current fall!