TCS Hits 52-Week High On Share Buyback Plan on Oct 11; Key Things For Investors

TCS Share Buyback: Shares of Tata Consultancy Services (TCS) hit a 52-week high of Rs 3,634.70, up 1 per cent on the BSE in Monday’s intraday trade after the company announced plans to consider a share buyback, along with its July-September results on October 11. However, the stock soon fell off its highs to trade marginally higher.

The last time TCS came up with a buyback plan was in 2022 March. The buyback share price per share was Rs 4,500 with a total buyback size of Rs 18,000 crore. The company completed its buyback programme between March 9 to March 23.

Prior to this, TCS had carried out buybacks in 2020, 2018, and 2017, and repurchased shares worth Rs 16,000 crore each.

In its exchange filing last week, the Indian IT major had informed Dalal Street bourses that its board of directors is going to consider and approve buyback of shares in its board meeting scheduled on October 11, 2023.

What Do Analysts Say?

The stock reaction aligned with the views from foreign brokerage Morgan Stanley which believes the buyback was unlikely to trigger an outperformance of the stock.

Morgan Stanley also feels that the announcement of the buyback plans does not necessarily provide enough assurance to stakeholders as it was already anticipated by the market for the last two quarters.

Asked about TCS share price chart structure, Sumeet Bagadia, Executive Director at Choice Broking said, “TCS shares are looking bullish on chart pattern and it may go up to Rs 3,750 to Rs 3,800 per share levels in near term. Those who have TCS shares in portfolio are advised to maintain stop loss at Rs 3,550 levels and hold for these targets. Fresh investors can also buy TCS shares at current levels maintaining stop loss at Rs 3,550 apiece levels.”

The buyback announcement from TCS comes after two other information technology companies, Infosys and Wipro completed their share buybacks earlier this year. Infosys rolled out its buyback after purchasing 6.04 crore shares for Rs 9,300 crore in February, while Wipro announced its largest-ever share buyback worth Rs 12,000 crore in June.

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