Tata Consultancy Services (TCS) becomes the second Indian company to cross Rs 8 trillion in market capitalization for the first time ever. Reliance Industries Limited (RIL) was the first company to do it on 23 August 3018.
Shares of TCS today surged to 1.7 percent to record a high of Rs 2,096.90 on the Bombay Stock Exchange (BSE) today. It has surged by 54.6 percent so far this year, rising ahead of its share buyback on 6 September, which will close on 21 September.
Additionally, the IT giant has raised hopes of double-digit growth in the current financial year after it bagged three large multi-year contracts worth more than $5.6 billion in revenue since December 2017. It is also benefiting from the rupee's fall against the dollar as it garners most of its revenue from software exports that earn in dollar terms.
As for the Rs 16,000 crore share buyback the company will purchase 76.19 million shares (1.99 percent of the paid-up equity capital) via a tender at Rs 2,100 apiece. Share buybacks are beneficial as they improve the earnings per share while returning surplus cash to shareholders and support the price of the stock when the market is slowing moving.