Home World Business TCS shareholders approve Rs 16,000-crore share buyback ahead of Q4 results

TCS shareholders approve Rs 16,000-crore share buyback ahead of Q4 results

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Buyback programme saw 99.81% of the total number of valid votes being cast in favour of the proposal

Ayan Pramanik  |  Bengaluru  April 18, 2017 Last Updated at 09:17 IST

Tata Consultancy Services, the country’s largest software exporter, said its shareholders had approved a Rs 16,000-crore plan.


Passed through a special resolution by the board of directors, the proposal saw 99.81 per cent of the valid votes being in favour, the company said.


The shares in the buyback represent 2.85 per cent of the total paid-up equity share capital, at Rs 2,850 a share.  


The board had approved the proposal in February, to buy back up to 56.1 million shares, for an aggregate not exceeding Rs 16,000 crore.


India’s information technology services are looking at returning cash to investors as they struggle to grow business in an uncertain environment. As the traditional IT services business gets slow and automation takes over, clients are increasingly spending on digital and cloud projects. 


At these, the business cycles are shorter and require to deploy resources at client locations, instead of offshore sites in India.


In February, prodded by activist investor Elliott Management, Cognizant Technology Solutions, which follows the offshore model like Indian IT service firms, announced it would return as much as $3.4 billion to shareholders, from dividends and


This was followed by TCS’ buyback. In March, HCL Technologies said it would buy back Rs 3,500 crore of shares. 


Last week, Infosys, under scrutiny by founder N R Narayana Murthy over alleged governance lapses, said it would return $2 billion to shareholders over the next 12 months.


TCS’ approval comes ahead of the announcement of its March quarter results on Tuesday. The stock  closed Rs 7 or 0.3 per cent down on Monday, at Rs 2,320.85 on the BSE exchange.


Last week, Infosys forecast lower growth for the year ahead, citing challenges for its traditional business, while struggling to win large deals in its newer offerings of artificial intelligence and cloud.

Strategic Move

  • TCS’ approval comes ahead of the announcement of its March quarter results on Tuesday 
  • Last week, Infy, under scrutiny by founder Murthy over alleged governance lapses, said it would return $2 billion to shareholders over the next 12 months

TCS shareholders approve Rs 16,000-crore share buyback ahead of Q4 results

Buyback programme saw 99.81% of the total number of valid votes being cast in favour of the proposal

Tata Consultancy Services, India’s largest software exporter on Monday said its shareholders have approved Rs 16,000 crore share buyback plan, as investors look to boost returns in the wake of slowing growth of the IT services sector.The buyback programme, which was passed through a special resolution, saw 99.81% of the total number of valid votes being cast in favour of the proposal, the company said in a regulatory filing.The proposed shares under the buyback represent 2.85% of the total paid up equity share capital at Rs 2,850 per equity share. In February, the board of TCS had approved the proposal to buy back up to 5.61 crore equity shares for an aggregate amount not exceeding Rs 16,000 crore.India’s IT services firms are looking at returning cash to investors as they struggle to grow business in an uncertain environment. As traditional IT services business slow and automation takes over, clients are increasingly spending on digital and cloud projects, where business cycles are .

Tata Consultancy Services, the country’s largest software exporter, said its shareholders had approved a Rs 16,000-crore plan.


Passed through a special resolution by the board of directors, the proposal saw 99.81 per cent of the valid votes being in favour, the company said.


The shares in the buyback represent 2.85 per cent of the total paid-up equity share capital, at Rs 2,850 a share.  


The board had approved the proposal in February, to buy back up to 56.1 million shares, for an aggregate not exceeding Rs 16,000 crore.


India’s information technology services are looking at returning cash to investors as they struggle to grow business in an uncertain environment. As the traditional IT services business gets slow and automation takes over, clients are increasingly spending on digital and cloud projects. 


At these, the business cycles are shorter and require to deploy resources at client locations, instead of offshore sites in India.


In February, prodded by activist investor Elliott Management, Cognizant Technology Solutions, which follows the offshore model like Indian IT service firms, announced it would return as much as $3.4 billion to shareholders, from dividends and


This was followed by TCS’ buyback. In March, HCL Technologies said it would buy back Rs 3,500 crore of shares. 


Last week, Infosys, under scrutiny by founder N R Narayana Murthy over alleged governance lapses, said it would return $2 billion to shareholders over the next 12 months.


TCS’ approval comes ahead of the announcement of its March quarter results on Tuesday. The stock  closed Rs 7 or 0.3 per cent down on Monday, at Rs 2,320.85 on the BSE exchange.


Last week, Infosys forecast lower growth for the year ahead, citing challenges for its traditional business, while struggling to win large deals in its newer offerings of artificial intelligence and cloud.

Strategic Move

  • TCS’ approval comes ahead of the announcement of its March quarter results on Tuesday 
  • Last week, Infy, under scrutiny by founder Murthy over alleged governance lapses, said it would return $2 billion to shareholders over the next 12 months

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Ayan Pramanik

Business Standard

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