Tata Consultancy Services Buyback (TCS Buyback) Detail

Established in 1968, Tata Consultancy Services (TCS) is an IT services, consulting, and business solutions provider. The company provides services grouped under the segments - Consulting and service integration, digital transformation services, cloud services, cognitive business operations, and products and platforms.
Key verticals the company serves are Banking, Financial Services, and Insurance (BFSI), Retail and Consumer Business, Communications, Media and Technology (CMT), Manufacturing, and Others.
TCS is a subsidiary of the Tata Group and is the largest IT services company in the world by market capitalization. TCS's geographic footprint covers North America, Latin America, the United Kingdom, Continental Europe, Asia-Pacific, India, the Middle East, and Africa. The company has over 556,986 employees around the globe and operates in 149 locations across 46 countries.

Cut-off price for Small Shareholder category (< Rs 2L holding)

A "Small Shareholder" is a Shareholder who holds Equity Shares having market value of not more than Rs 200,000 on the Record Date.

As on the Record Date, the closing price on NSE, being the Recognized Stock Exchange having the highest trading volume, was Rs 3,571.90 per Equity Share. Accordingly, all Eligible Shareholders holding not more than 56 Equity Shares as on the Record Date are classified as 'Small Shareholders' for the buyback offer.

Buyback Price Calculation and Eligibility Criteria for Retail Small Shareholders Category

Number of Shares to qualify as Small Shareholder in TCS 2022 Buyback = Rs 3,563.80 * 56 = Rs 199572.80 (which is less than Rs 2,00,000)

TCS Buyback 2022 Buyback Entitlement

As per the email received from registrar on March 5th, 2022, the buyback entitlement is:

1. Retail Investors: 14% (Less than Rs 2,00,000)
2. Others: 0.92%

Acceptance Ratio for TCS Buyback

TCS accepted 26% shares in its buyback for retail category. People who applied for 50 shares got accepted 13 shares. HNI acceptance ratio is 2.45%.

Buyback History

Buyback Ratio

Company Financials

Necessity of the Issue

The Buyback aims to :
i) Return excess cash to the shareholders.
ii) Increase shareholder's value in the long term; and
iii) Improve Return on Equity.

Find TCS Buyback Latest Update

• TCS Buyback FAQs
• TCS Buyback Live News

1. 1. What is the TCS Buyback 2022 size?

   The Buyback Offer size in terms of Equity Shares to be bought back will be 4,00,00,000 Equity Shares and in terms, the amount will be approximately Rs.18,000 Crores, which represents 1.08% of the total issued and paid-up equity share capital of the Company, as of December 31, 2021.

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2. 2. What is the TCS Buyback Price?

   The Equity Shares will be bought back at a price of Rs 4,500 per Equity Share.

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3. 3. What will be the impact of tax on TCS buyback?

   The income from the accepted buyback share is tax-free. There are no short-term or long-term capital gain taxes on the profits from TCS buyback accepted shares. The buyback price of Rs 4500 is the net price you will get for shares accepted.

   But the gain/loss from the sell of the remaining share in the open market (not accepted in buyback offer) will be taxable as usual.

   Example:

   1. If you buy 1 share for 3700 and TCS accepts it in a buyback offer, the Rs 800 profit will be tax-free.
   2. If you buy 50 shares at 3700 and 25 shares are accepted by TCS for buyback and the remaining are sold in the open market at 4000. Profit from buyback accepted shares (Rs 800*25 = Rs 20,000) is tax-free. Profit from remaining shares (Rs 300*25 = Rs 7500 is taxable.

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4. 4. What is the mode of TCS Buyback?

   This TCS Buyback offer will be implemented through the "Tender Offer" route.

   The 'Tender Offer' means an offer by a company to buy back its own shares through a letter of offer from the shareholders. The shareholders have to contact their Share Broker to submit the shares.

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5. 5. Is it compulsory to tender TCS shares through a broker?

   Yes. The Shareholders who desire to tender their Equity Shares in the electronic form or physical form under the Buyback would have to open a trading account with any BSE or NSE registered broker.

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6. 6. Can I tender TCS shares under pledged for margin?

   No, lock-in/ pledged and non-transferable shares cannot be tendered.

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7. 7. What portion of my holding can I tender to the company as part of the buyback?

   Shareholders holding Equity Shares as on the Record Date (Feb 23, 2022) would be eligible to participate in the buyback. Shareholders would either be categorized as a general category shareholder or a small shareholder based on the market value of shares held on the Record Date. The entitlement for each shareholder would then be fixed as per their holding on the Record Date. Shareholders can tender either part or entire holding as on the Record Date in the buyback. However, the acceptance would initially be the entire entitlement of the shareholder and any additional acceptance would be based on the overall additional shares tendered by all the Eligible Shareholders.

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8. 8. How does one participate in the TCS buyback in case one does not receive the tender/offer form?

   Receipt of tender/ offer form is not necessary. If you are a TCS shareholder on the Record Date, you can participate in the buyback. An Eligible Shareholder may participate in the Buyback by downloading the Tender Form from the websites of the Company and the Registrar to the Issue.

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9. 9. What is the manner in which TCS decides the acceptances from each shareholder?

   Acceptance will be decided basis the number of shares tendered in the buyback. The entire entitlement of the Eligible Shareholders would be accepted and if any additional shares are tendered by the Eligible Shareholders, the same would be accepted on a proportionate basis.

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10. 10. When will the TCS shareholder receive an intimation about acceptance of his/her shares?

    The shareholder would receive the intimation once their shares are accepted and settlement is completed post the completion of the tendering period.

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11. 11. Why is TCS doing a share buyback at an all-time high price?

    The current Buyback is in line with the Company's shareholder-friendly capital allocation practices of returning excess cash to shareholders, thereby increasing shareholder value in the longer term, and improving the Return on Equity.

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TCS Buyback FAQs

When is TCS Buyback offer coming?

The TCS Buyback opens on March 9, 2022, and closes on March 23, 2022.

Which is the last day to buy TCS Buyback for buyback?

The TCS Buyback last day to buy is not available as of now.

Which type of buyback is TCS Buyback offer?

The TCS Buyback is a Tender Offer.

What is the schedule of activities for TCS Buyback?

TCS Buyback Schedule

Buyback Opening Date	March 9, 2022
Buyback Closing Date	March 23, 2022
Last Date for receipt of Tender Forms	March 23, 2022
Finalisation of Buyback Acceptance	March 31, 2022
Last Date for settlment of bids	April 1, 2022
Last Date for Extinguishment of Shares	April 8, 2022

What is the offer price for TCS Buyback offer?

The TCS Buyback is being offered at Rs ₹4500 per share per equity share.

In what ratio is the TCS Buyback offered?

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What is the record date for TCS Buyback offer?

The record date for the TCS Buyback is February 23, 2022.

What is the issue size of TCS Buyback?

The issue size of TCS Buyback is of 40,000,000 equity shares at ₹4500 per share aggregating upto ₹18,000.00 Crores.

What is the necessity for TCS Buyback?

The Buyback aims to :
i) Return excess cash to the shareholders.
ii) Increase shareholder's value in the long term; and
iii) Improve Return on Equity.

Where can I get the Letter of Offer for TCS Buyback?

Letter of Offer

How to participate in TCS Buyback?

All the eligible Shareholders of the Company holding either Physical Shares or Demat Shares as on the Record Date can participate in the buyback offer through their Stock Broker.

The eligible shareholder holding the shares in Demat form needs to inform their broker the details of the Equity shares they wish to tender in the Buyback Offer. The shareholder needs to transfer the tendered shares to a Special account of the clearing corporation. The broker, in turn, would place an order on the stock exchange for the buyback.

The eligible shareholder holding the shares in physical form needs to approach their broker with original share certificates and supporting documents. Upon completion of document verification, the broker places an order on the stock exchange and submits the original share certificate and TRS to the registrar.

The tender form and TRS are optional in the case of Demat shares but mandatory in the case of physical shares.

Is TCS Buyback good or bad?

The TCS Buyback offers an opportunity for the shareholders to exit their positions at a premium price. In case you stay invested you would have an increased percentage of shareholding in the company and improved earnings per share. Thus, one should understand the company fundamentals along with one's need, goals, and risk appetite to decide if one wants to stay invested or participate in the buyback offer.