TCS Buyback for Non-Retail Shareholders - An analysis of TCS buyback of over 2 Lacs shares!

Опубликовано: 26 Апрель 2025
на канале: Keep it Simple

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This video is in Hindi and covers the following topics:

TCS Buyback -for Non Retail Shareholders
क्या आपको Market से 2 लाख से ज्यादा के Share खरीद कर Buyback में participate करना चाहिए?

Buyback size of ₹18,000 crore works out to 1.08% of the total paid-up equity share capital

TCS has announced it will buy back four crore shares at ₹4,500 apiece.

The buyback price is at a premium of ~17% over TCS’s today’s closing price of ₹3,856

The buyback is through the tender offer route (The company can repurchase their share from the brokers in the open market at the market price or can repurchase the shares from investors through a tender offer at a price higher than the market price)

Out of the four crore shares that will be bought back, 60 lakh shares or 15% of the buyback is reserved for retail shareholders holding shares worth less than ₹2 lakh on the record date, which is yet to be announced.

The remote e-voting period commences from 9.00 a.m. (IST) on Friday, January 14, 2022 and ends at 5.00 p.m. (IST) on Saturday, February 12, 2022.

The Scrutinizer will submit the report to the Chairman of the Company, or any person authorized by him upon completion of the scrutiny of the votes cast through remote e-voting.

The results of the Postal Ballot will be announced at or before 5.00 p.m. (IST) on Tuesday, February 15, 2022.

The exact number of eligible shareholders as on the record date will be available in the letter of offer, which will be posted within two weeks after the record date.
As small shareholders held 0.6% of the company's total paid-up capital as of March 2021, the entitlement ratio comes to around 27%

Entitlement Ratio: The entitlement ratio is nothing but the ratio of shares a retail investor has offered in the buyback compared to the total number of shares held in the overall retail investor category.

While retail investors are free to tender all the shares that they hold in the offer, it is not necessary that they will all be accepted

The acceptance ratio represents how many shares the company will be able to accept in a buyback offer for every 100 shares tendered by shareholders.

Acceptance ratio is generally lower if a higher number of eligible investors tender shares. But it cannot be less than the entitlement ratio

In the recent buyback offers, most small shareholders did not participate, boosting the acceptance ratio. The acceptance ratio was 100% in the previous two buybacks by TCS.

Assuming the closing value of TCS on the buyback's record date is ₹4,500, a shareholder with up to 44 shares will be considered a small shareholders

It is the largest Tech Stock in India. TCS has been a wealth creator for multiple decades.

The demand outlook continues to be strong as clients are accelerating their spending on cloud transformation and new technologies to remain ahead of the curve