TCS Rs 17,000 Crore Buyback: Tech Giant's 4.09 Crore Buyback Offer To Open On December 1; Details Here

Indian tech giant Tata Consultancy Services' (TCS) much-awaited buyback offer to the tune of Rs 17,000 crore is all set to open on December 1st, and bidding will be available till December 7th. This would be the fifth buyback by TCS in the last six years.

As per the latest regulatory filing, TCS' buyback offer comprises over 4.09 crore equity shares with a floor price of Rs 4,150 per share amounting to Rs 17,000 crore.

The buyback entitlement ratio for the reserved category of small shareholders is 1 equity share for every 6 equity shares held on the record date. While for general category shareholders, the ratio will be 2 equity shares for every 209 equity shares of TCS held on the record date. TCS set the buyback record date on November 25 and turned ex-buyback on November 24th. So shareholders who hold TCS shares by the end of November 24, 2023, will be eligible to participate in the buyback offer since November 25th was a weekend holiday.

Here are some of the key important dates that investors should not miss out on if they want to participate in the TCS buyback:

After the record date, the last date for dispatch of the Letter of Offer is set on November 29th. The buyback will initially open on December 1st and will close on December 7th which will also be the last date of receipt of completed Tender Forms and other specified documents including physical share certificates (if and as applicable) by the Registrar.

Going forward, the last date for verification of Tender Forms by the Registrar is set on December 11th, and the last date for providing Acceptance/Non-acceptance of tendered Equity Shares to the Stock Exchange by the Registrar is scheduled on December 13th.

Meanwhile, the last date of settlement of bids on the Stock Exchange will be on December 14th, which will also be the last date for dispatch of share certificate(s) by the Registrar/return of unaccepted demat Equity Shares by Stock Exchange to Seller Member/ Eligible Shareholders.

Finally, the last date of extinguishment of Equity Shares is scheduled for December 26th.

The floor price of Rs 4,150 per share is at a premium of 19.6% compared to the current market price of Rs 3470.45 apiece on BSE after market hours of Tuesday. TCS is the largest IT firm in the country, and second largest firm in terms of market share after Reliance. Currently, it has nearly Rs 12.7 lakh crore worth of market cap.

The Buyback is within 25% of the aggregate of paid-up capital and free reserves of TCS and represents 1.12% of the total issued and paid-up Equity Share Capital of the company as of September 30, 2023.

JM Financial is the manager of the buyback offer, while Link Intime India is the registrar.

It needs to be noted that the current buyback is in--line with TCS' shareholder-friendly capital allocation practices of returning excess cash to shareholders, thereby increasing shareholder value in the long term and improving the Return On Equity.

The last buyback offer by TCS was of Rs 18,000 crore in 2022, which was oversubscribed by 7.5 times. In this buyback, investors offered 30.12 crore equity shares at the buyback price of Rs 4,500 per share, against the buyback size of 4 crore shares.