TCS Releases Dates of Rs 18,000 Crore Share Buyback

Tata Consultancy Services has released the dates for its Rs 18,000 crore share buyback officer, which was announced in January this year. The share buyback offer will open on March 9 and will close on March 23. 

TCS has revealed the category for small shareholders, and the ratio of buyback will be 1 equity share for every 7 equity shares held on the record date.

In the general category for other eligible shareholders, the ratio of buyback will be 1 equity share for every 108 equity shares held on the record date. This will be the fourth buyback of TCS and in its earlier buyback offers, Tata Sons was the biggest beneficiary.

In 2021, TCS bought back more than 53 million shares at Rs 3,000 per share, and 33.33 million shares were accepted for offer. There were also two buybacks in 2017 and 2018, each measuring around Rs 16,000 crore each. As of the end of September 2021, TCS  cash and cash equivalents were Rs 51,950 crore.

The latest move is after Tata Sons bought Air India from the government of India for Rs 18,000 crore. The company pays the government Rs 2,700 crore and the rest is used to repay the debt. Tata Sons currently owns 72% of TCS.

According to analysts, share buyback typically improves earnings per share and return surplus cash to shareholders while also supporting the stock during sluggish market conditions. Infosys announced a buyback of Rs 9,200 crore in 2021 while in January 2021 Wipro held a Rs 9,500 crore buyback. HCL Tech also held a Rs 4,000 crore buyback in 2018.