TCS fixes November 28 as record date for share buyback; stock gains 2%
Shares of Tata Consultancy Services (TCS) were up 2 per cent to Rs 2,678.60 on the BSE in the early morning trade on Thursday after the company fixed November 28, 2020, as the record date for the purpose of determining the entitlement and the names of the equity shareholders who shall be eligible to participate in the buyback.
The TCS board on October 7 had approved a buyback of Rs 16,000 crore to buy back around 53.3 million shares at Rs 3,000 per share.
Post buyback announcement, however, the stock of TCS has underperformed the market by falling 3.3 per cent as compared to a 11.6 per cent-rally in the S&P BSE Sensex till Wednesday. The stock hit a record high of Rs 2,885 on October 8, 2020.
Backed by $8.6 billion order book, TCS' growth trajectory remains robust, say analysts at Geojit Financial Services. "The roll out of salary hikes will increase expenses; however, the management is confident of maintaining improved margin levels. Furthermore, owing to the Covid-19 pandemic, the digital transformation across sectors have accelerated and this will help TCS to leverage their expertise and gain more business," the brokerage firm said in September quarter result update.