TCS's board approved a proposal to buy back up to 7.6 crore equity shares "for an aggregate amount not exceeding Rs 16,000 crore
India's largest information technology company Tata Consultancy Services on Friday announced a buyback of up to Rs 16,000 crore.
TCS's board approved a proposal to buy back up to 7.6 crore equity shares "for an aggregate amount not exceeding Rs 16,000 crore", at 1.99 percent of the total paid up equity share capital, at Rs 2,100, a premium of 14 percent over TCS's market price of Rs 1,843 at 3 pm and 17 percent from Thursday's close.
Shares of the IT major were trading higher by close to 3 percent after the announcement.
The company had said earlier in the week that it would consider a buyback at its annual general meeting of the Board. Brokerages had pegged the quantum of buyback to be between Rs 10,000 crore and Rs 20,000 crore.
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TCS had carried out a Rs 16,000 crore buyback of 5.61 crore shares, or 3 percent of its total equity, at Rs 2,850 per equity share last year. The buyback price was at a 16 percent premium to its market price back then.
Among the major IT players in India, TCS has been performing the best in terms of business, signing mega deals even in a time of slowing growth for the overall sector.
"With multiple mega deals in the bag, TCS is set to continue on its path of gradual acceleration in growth witnessed over the past two quarters, and potential hitting double-digits in constant currency toward the latter half of the year," research analysts Ashish Chopra and Sagar Lele at Motilal Oswal had noted in a note earlier this week.