TCS board to consider buyback, results on Jan. 12

The country’s largest IT firm Tata Consultancy Services Ltd on Friday said it will consider buying back shares for the second time in two years, which could funnel cash back to its holding company and the biggest shareholder, Tata Sons Pvt Ltd.

The company’s board will explore the proposal when it meets January 12, TCS said in a statement, without elaborating. The company had bought back shares worth Rs 16,000 crore in January 2021, of which nearly Rs 10,000-crore worth shares came from Tata Sons.

The board of the Mumbai-based company is scheduled to meet coming Wednesday to approve and take on record the company’s financial results for the third quarter and nine months ending December 31, 2021.

At the end of the September 2021 quarter, TCS had cash and cash equivalents of Rs 51,950 crore.

On Friday, TCS shares closed 1.26 per cent higher at Rs 3,854.85 on the BSE.

TCS' previous buyback offer of around Rs 16,000 crore had opened on December 18, 2020, and closed on January 1, 2021. 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 taken 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, Infosys had said it has bought back shares worth about Rs 9,200 crore. Wipro had also completed a Rs 9,500-crore buyback in January last year.