Buyback

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  • Buybacks are very interesting activities. It’s when a company decides to buy some of its listed shares back from stock market investors.

    Often, buybacks can offer many short-term investment opportunities. This is because companies usually announce a buyback at a price higher than the existing market price. So, many short-term investors look to buy the shares of the company at the lower market price and submit them in the company’s buyback.

    Here are the latest Buybacks:

    • Company: Mphasis
    • Buyback price: Rs 1,350
    • Buyback amount: Rs 988 crore
    • Our recommendation: Buy now, participate in buyback
    • Record date: 25th October, 2018

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    • Company: TCS
    • Buyback price: Rs 2,100
    • Buyback amount: Rs 16,000 crore
    • Our recommendation: Buy now, participate in buyback
    • Record date: 25th October, 2018

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    Buyback performance update:

    TCS Buyback

    • Tata Consultancy Services (TCS) bought back 7,61,90,476 equity shares at a price of Rs 2100.
    • The total amount utilized in the buyback was Rs 16,000 crore.
    • As per SEBI norms, 15% of the buyback is to be reserved for small shareholders (shareholding less than Rs 2 lakhs). Out of 1,14,28,572 shares reserved, 40,16,984 shares were tendered. Thus, all small shareholders’ shares were accepted in the buyback.

    Below is a brief calculation of returns for a small shareholder buying TCS after the buyback research report:

    Kotak Securities (PCG Research) Report date 26th June, 2018
    10-day average price after report (27/6/18 to 10/7/18) Rs 1,869.14
    Buyback Price Rs 2,100.00
    Pre Tax Return 12.4%
    Buyback Announced 15th June, 2018
    Buyback Completed 28th September, 2018


    Don’t have an account? Click here to open an account and start participate in a buyback