All You Need to Know About TCS BuyBack
One of India’s leading IT players, Tata Consultancy Services (TCS), announced its share buyback plan. The record date for the same is fixed on November 25, 2023. This is for identifying the eligible shareholders whose shares will be bought back by the company.
The TCS Buyback of Rs 17000 crores, which was approved by the board of directors at the meeting, was held on October 11, 2023.
It is noteworthy to remember that the board of directors of TCS approved the buyback by the Company of its fully paid-up equity shares having a face value of Rs 1 each equity share at a price of Rs 4150 per Equity Share and for an aggregate amount not surpassing Rs 17000 crores from the shareholders.
TCS Buyback 2023 Dates and Details
|
Buyback Type |
Tender Offer |
|
Buyback Record Date |
November 25, 2023 |
|
Date of Board Meeting approving the proposal |
October 11, 2023 |
|
Date of Public Announcement |
October 11, 2023 |
|
Buyback Offer Amount |
Rs 17,000 Cr |
|
Buyback Offer Size |
1.12% |
|
Buyback Number of Shares |
4,09,63,855 |
|
FV |
1 |
|
Buyback Price |
Rs 4,150 Per Equity Share |
Companies | Type | Bidding Dates | |
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| Regular | - | ||
| Regular | - | ||
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How to Apply for TCS Buyback on Groww
Here’s how to apply for TCS buyback on Groww website-
Step 1: You can search for the TCS buyback in the search option on the Groww website.
Alternatively, an option to apply is also available in our Help and Support section.
Step 2: After you land on the TCS buyback screen, enter the number of shares you are eligible for and click on sell.
Step 3: The next screen will give you a detailed snapshot of your TCS buyback application.
You may have to complete your e-DIS verification before you sell. As per a SEBI rule, you can only sell your stocks if your holdings have been verified.
Advantages of TCS Buyback
- The buybacks are part of TCS’s long-term principal allotment policy of returning excess cash back to its shareholders. And reducing the number of shares traded in the open market.
- Buybacks generally indicate that the company has set aside an emergency corpus and has surplus cash, wherein the business’s possibility of an economic downturn is less.
- Boosts the investor’s confidence in the company since it adds value to their capital.
- Excellent opportunity for TCS shareholders who want to make short-term gains.
- Buyback reduces the number of shares being traded in the market; this may drive the demand up, increasing the stock price.
- With fewer shares being traded in the market, the company’s Earnings Per Share (EPS) may rise.
Disadvantages of TCS Buyback
- Due to the company’s gigantic size and market capitalization, the buyback may have a marginal effect. It may not provide an uptick to the stock, already one of India’s most expensively valued IT stocks.
- While the buyback may lead to short-term profit, investors might miss out on the long-term gains, with TCS projecting strong growth in an environment where the demand for tech and IT services is at an all-time high.
- An upswing in the EPS may make the share prices artificially inflated for a small period of time.
- The funds being used for the buyback could have been used for other investments. It may have been productive and profitable.
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Research Analyst - Aakash Baid