Tata Consultancy Services shareholders on Monday approved a Rs 16,000-crore share buyback plan, which is believed to be the biggest such programme ever in India. The board of TCS had approved the buyback proposal in February this year.
The programme was passed through a special resolution that saw 99.81% investors voting in favour of the move. “In all, 7,341 members voted in favour of the resolution and 577 against it through electronic voting system and physical ballot form between March 17 and April 15,” the information and technology firm said in its filing at the bourses.
The approval came ahead of the announcement of TCS’ fourth quarter and the 2016-2017 results, which will be announced on Tuesday. The shares of TCS traded 0.30% higher on the National stock Exchange on Tuesday, rising 2.90 points on the Bombay Stock Exchange as of 9.30 am.
On February 20, the TCS board had decided that it would repurchase 5.61 crore shares at Rs 2,850 a unit, representing 24.47% of its consolidated net worth. The buyback would be “made from shareholders of the company on a proportionate basis under the tender offer route using the stock exchange mechanism”, the company had earlier said.
More than 6,36,000 institutional as well as individual investors have the company’s 19.7-crore equity shares. The country’s largest IT firm has at least Rs 43,169 crore cash pile – nearly 10% of the company’s market capitalisation, PTI reported.
Indian IT firms have been under pressure lately to return excess cash on their books to their shareholders either through generous dividends or share buybacks. On April 13, Bengaluru-based Infosys had announced to pay up Rs 13,000 crore to shareholders in the 2017-2018 financial year by the way of dividend or share buyback.