MUMBAI: In what is going to be the second share buyback in two years beneath Tata Group chairman N Chandrasekaran, the rustic's biggest tool services and products corporate TCS has introduced to spend up to Rs 16,000 crore to repurchase its own stock for Rs 2,100 a work. The buyback value is 14 in step with cent top rate to TCS' Friday final value of Rs 1,841 on the BSE. Aimed at distributing excess cash to shareholders, the corporate will repurchase 7.6 crore stocks, representing about 2 in step with cent of its equity capital, on a proportionate basis.
The biggest beneficiary of this share buyback scheme will probably be TCS' father or mother Tata Sons. Based on its 72 in step with cent stake within the IT services and products behemoth, the father or mother gets Rs 11,502 crore from participating within the programme. The cash will give Chandrasekaran further sources to strengthen Tata Sons' balance sheet, elevate holdings in workforce corporations, retire debt of the telecom trade and finance buyouts like Bhushan Steel and Bhushan Power.
TCS had cash and investments of Rs 79,755 crore on its books as on March 31, 2018. If the corporate spends all of the Rs 16,000 crore on the share repurchase programme, its cash would come down to Rs 63,755 crore.
Early this month, TCS chief Rajesh Gopinathan had mentioned that the corporate's plan is to return at least 80% of its loose reserves to shareholders every year. Instead of maximising returns on cash and investments, its technique could be to distribute surplus cash to shareholders, Gopinathan had mentioned. Last yr too, the corporate had spent a an identical quantity of Rs 16,000 crore on share buyback.
Investors were turning the warmth on large IT corporations to return excess cash to shareholders as they shy away from making big-ticket acquisitions and instead sit down on massive cash piles.
In 2017, 4 IT corporations, including Infosys and Wipro, spent Rs 43,500 crore on share buybacks. Buyback is a tax-efficient approach of returning cash to shareholders as in comparison to giving dividends. It also is helping in improving income in step with share and boosts the cost of the stock right through gradual marketplace stipulations.
The biggest beneficiary of this share buyback scheme will probably be TCS' father or mother Tata Sons. Based on its 72 in step with cent stake within the IT services and products behemoth, the father or mother gets Rs 11,502 crore from participating within the programme. The cash will give Chandrasekaran further sources to strengthen Tata Sons' balance sheet, elevate holdings in workforce corporations, retire debt of the telecom trade and finance buyouts like Bhushan Steel and Bhushan Power.
TCS had cash and investments of Rs 79,755 crore on its books as on March 31, 2018. If the corporate spends all of the Rs 16,000 crore on the share repurchase programme, its cash would come down to Rs 63,755 crore.
Early this month, TCS chief Rajesh Gopinathan had mentioned that the corporate's plan is to return at least 80% of its loose reserves to shareholders every year. Instead of maximising returns on cash and investments, its technique could be to distribute surplus cash to shareholders, Gopinathan had mentioned. Last yr too, the corporate had spent a an identical quantity of Rs 16,000 crore on share buyback.
Investors were turning the warmth on large IT corporations to return excess cash to shareholders as they shy away from making big-ticket acquisitions and instead sit down on massive cash piles.
In 2017, 4 IT corporations, including Infosys and Wipro, spent Rs 43,500 crore on share buybacks. Buyback is a tax-efficient approach of returning cash to shareholders as in comparison to giving dividends. It also is helping in improving income in step with share and boosts the cost of the stock right through gradual marketplace stipulations.
TCS to spend Rs 16,000 crore on share buyback
![TCS to spend Rs 16,000 crore on share buyback]()
Reviewed by Kailash
on
June 16, 2018
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