Shares of software exporting firm Tata Consultancy Services caught investors' fancy, rising over 2.5 percent to touch a high of Rs 2,477.50.
Following the sharp appreciation, the stock today scaled over a five-month high as investors gave thumbs up to the company's decision in its share buyback plans.
At 12.55pm, TCS shares were trading at Rs 2,448.10, up 1.4 percent over previous close. Over 1.15 lakh shares changes hands on BSE. On the other hand, the benchmark Sensex rose 0.4 percent to 28,260.05, maintaining a steady positive trend since early trades.
In a release issued to to BSE, the company said, "Tata Consultancy Services has informed BSE that the board of directors will consider a proposal for buyback of equity shares of the company at its meeting to be held on February 20, 2017."
The company also also its board will also discuss suggestions received on certainty over dividend policy.
According to report, TCS has a cash pile of Rs 43,100 crore on its book, accounting for 9 percent of its market capitalisation.
Other software majors such as Infosys has Rs 26,000 crore, while HCL Technologies has Rs 9,582 crore and Tech Mahindra has around Rs 3,000 crore cash on its book, the Economic Timesreport said.
Stating that the company had received suggestions from investors over the need for certainty on dividend policy along with share buyback to distribute the cash, outgoing TCS chief N Chandrasekaran said: "These two comments have come from investors and we will discuss it in the board."
Without giving any further details on the issue in an interview with CNBC TV18, he said TCS has been building up cash to meet its requirements, especially in the case of any mergers and acquisitions, and the excess sum has been shared consistently with shareholders.
Chandrasekaran said that over the years, TCS has been increasing its dividend payments to shareholders.
On the issue of impact on Indian IT industry in the wake of proposed tightening of H-1B visas norms and hike in fees by the US, Chandrasekaran said that for TCS, it will not be a big issue.
TCS has worked in an environment where visas were difficult to get. "USD 1,00,000 minimum wage in the US will not be a problem," he pointed out.
Published Date: Feb 16, 2017 01:02 pm | Updated Date: Feb 16, 2017 01:02 pm