India's largest IT services company, Tata Consultancy Services (TCS), on Wednesday said its board has approved a proposal to buy back up to 4 crore shares of the company for an aggregate amount not exceeding Rs 18,000 crore.

Share Market Live

NSE

"The Board of Directors at its meeting held has approved a proposal to buy-back up to 4,00,00,000 equity shares of the company for an aggregate amount not exceeding Rs 18,000 crore being 1.08% of the total paid up equity share capital at 4,500 per equity share subject to approval from shareholders," TCS said in a filing.

"The Buyback is subject to the approval of the Shareholders by means of a special resolution through a postal ballot. The public announcement setting out the process, timelines and other requisite details will be released in due course in accordance with the Buyback Regulations," the company said.

Also Read:

Govt to hold 35.8% in Vodafone Idea after conversion of AGR dues into equity

The offer price of Rs 4,500 per share is about 16.6 percent higher than Wednesday's closing level of Rs 3,857.25 on the BSE. The public announcement setting out the process, timelines, and other requisite details will be released in due course in accordance with the buyback regulations, the company said.

As per the filing, promoter companies held a 72.19 percent share in TCS as of January 7, 2022. Indian financial institutions/banks/MFs/ insurance companies held 7.8 percent; FIIs/FPIs/NRIs/foreign nationals and overseas corporate bodies 15.23 percent; resident individuals and others 3.88 percent; clearing members 0.01 percent; and bodies corporate/ LLP/ Trust/NBFC 0.90 percent.

At the end of the December 2021 quarter, the Mumbai-based company had cash and cash equivalents of Rs 59,920 crore. Its net cash from operations stood at Rs 10,853 crore. TCS' previous buyback offer of around Rs 16,000 crore had opened on December 18, 2020, and closed on January 1, 2021.

Also Read: Centre to allow 20% FDI in LIC before mega IPO: Report

Over 5.33 crore equity shares were bought back under the offer for Rs 3,000 apiece. In 2018, TCS had undertaken a share buyback programme worth up to Rs 16,000 crore. The buyback, at Rs 2,100 per equity share, had entailed up to 7.61 crore shares. In 2017 too, TCS had gone for a similar share purchase programme.

Smaller peers like Infosys and Wipro have also undertaken buyback programmes to return surplus cash on their books to shareholders. In September last year, Infosys had said it has bought back over 5.58 crore equity shares as part of its about Rs 9,200 crore buyback offer.

The process -- conducted via open market through Indian stock exchanges -- saw shares being bought back in the range of Rs 1,538.10 and Rs 1,750. Wipro had also completed a Rs 9,500 crore buyback in January last year.

Also Read: Sresta Natural Bioproducts files draft papers with Sebi; aims to raise Rs 500 crore via IPO

The company reported a 12.2 percent rise in its consolidated net profit to Rs 9,769 crore for the December 2021 quarter. The country's largest software services firm had logged a net profit of Rs 8,701 crore in the year-ago period.

Revenue of the firm grew 16.3 percent in the quarter under review to Rs 48,885 crore from Rs 42,015 crore in the corresponding period last fiscal, TCS said.

The company has also announced a dividend of Rs 7 per share with the record date being set as January 20, 2022, and the payment date as February 07, 2022.

Also Read: Oye Rickshaw plans to deploy over one lakh e-rickshaws this year, expand ops to 25 new cities

Shares of TCS ended at Rs 3,857.25, down by Rs 58.55, or 1.50 percent on the BSE.

(Edited by : Jomy Jos Pullokaran)

First Published:Jan 12, 2022 6:50 PM IST