Tata Consultancy Services shareholders on Monday approved the company’s ₹16,000-crore share buyback plan.
TCS, India’s largest software exporter, made the announcement in February when its board approved a plan to buy back up to 5.61 crore equity shares for an aggregate price not exceeding ₹16,000 crore.
The share buyback programme saw 99.81 per cent of the total number of valid votes being cast in favour of the proposal, the company said in a filing with stock exchanges.
The proposed shares under the buyback represent 2.85 per cent of the total paid-up equity share capital at ₹2,850 per equity share.
The buyback will be on a proportionate basis under the tender offer route, using the stock exchange mechanism, the company said in a filing in February. This is the biggest buyback in the history of India’s capital markets, surpassing Reliance Industries’ share repurchase of ₹10,400 crore in 2012.
Technology companies, although flush with cash, have for long stayed away from returning capital to shareholders through a buyback. TCS, for example, is sitting on a cash pile of nearly ₹43,000 crore.
The buyback move by India’s largest software exporter could see investors in Infosys and Wipro clamouring for a similar payout. Both companies said last week that they would consider a share buyback.
On January 31, the board of Mphasis had approved a buyback worth a little over ₹1,100 crore. Nasdaq-listed Cognizant recently announced a share buyback of $3.4 billion.