Tata Consultancy Services (TCS) has announced a buyback of equity shares aggregating up to Rs. 17,000 crores through the tender market buyback route at Rs. 4150 per share.
To determine the shareholders who are eligible for tendering the shares in the buyback, the company has fixed November 25, 2023, as the record date with November 24, 2023 being the ex-date.
When will the buyback open?
TCS buyback opens on December 1, 2023 and will close on December 7, 2023.
Buyback Schedule
| Record Date | November 25, 2023 |
| Buyback Opening Date | December 1, 2023 |
| Buyback Closing Date | December 7, 2023 |
| Buyback Price | Rs. 4150 per share. |
| Credit of payment for accepted shares/credit of unaccepted shares to demat account | December 14, 2023 |
You can keep track of all the latest Buybacks, Takeovers, and Delistings on Bulletin
When should I buy shares to be eligible for the buyback?
You will be eligible for buyback if you have bought shares on or before November 23, 2023, the ex-date is November 24, 2023.
What are the categories in which I can tender shares in buyback?
There are two categories Retail and General through which one can tender shares in the buyback. The value of shares held in the Demat account by November 25, 2023 (record date) end-of-the-day will determine the category through which one will be eligible to apply.
All shareholders holding shares worth Rs. 200,000 or less will be considered under the Retail category. While those holding shares worth more than Rs. 200,000 will be considered under the General category.
| Entitlement Ratio | |
|---|---|
| Retail Category | 1 share for every 6 shares held on record date |
| General Category | 2 shares for every 209 shares held on record date |
What is a tender market offer?
There are two types of buybacks: tender offer and open market offer. Companies can choose either of these methods to buy back shares from their shareholders.
Open-market offer: The company can buy back its shares by actively buying from sellers on the exchange. The buyback period is mentioned in the buyback offer, and it can last for months to ensure that there is no significant price movement due to the buying activity.
Tender offer: The company makes an offer to buy back its shares at a particular price (offer price) at which the shareholders can tender, i.e., sell their shares.
How do I offer shares in tender market buyback?
In a tender offer, you can offer shares directly to the company. In an open market buyback, the company actively buys the shares on stock exchanges.
The TCS buyback tender window will be announced very soon. You can tender the shares during this period via Console. You can check out the process here.
Will I be eligible for the buyback if I’ve pledged shares of TCS?
Yes, even if the shares are pledged, you are eligible for all corporate action benefits. However, you will have to unpledge the shares before tendering them in the buyback. See How do I unpledge shares?
Do I need to submit DDPI/POA to tender shares in buyback?
DDPI/POA is not needed to tender shares in the buyback. You can apply for buyback by authorizing CDSL TPIN and OTP. See What is the CDSL TPIN and how do I use it to sell my stock holdings?
I sold TCS shares after the record date, can I still take part in the buyback?
Yes, as you were holding the shares on record date you are eligible. You can buy the shares back and tender them in the buyback.
Can I tender more shares than I’m entitled for?
If you tender more shares than your entitlement, then whether these additional shares will be accepted for buyback or not will solely depend on the acceptance ratio decided by the company. The shares that are not accepted will be credited back to your demat account by the RTA.
How does the taxation work for tender market buyback?
The company buying back the shares in a tender offer or open-market offer pays all taxes on the buyback offer. Buyback transactions are shown separately in the Console tax P&L, and there won’t be any additional tax liability in such a case.