New Delhi: Tata Consultancy Service's (TCS) share on Thursday witnessed a jump over 2 percent after the company reported a 12.2 percent jump in the December quarter.
The stock gained 2.25 percent to Rs 3,944.40 at the Bombay Stock Exchange (BSE), while on the National Stock Exchange (NSE), it jumped 1.63 percent to Rs 3,923.
The company on Wednesday reported a 12.2 percent jump in December quarter net profit at Rs 9,769 crore on handsome revenue growth.
The company, which is sitting on cash and equivalent of over Rs 65,000 crore, also announced an up to Rs 18,000-crore buyback offer where it has committed to pay Rs 4,500 per share.
Notably, the Board of Directors of the company in its meeting held today said that it has approved the proposal for buyback of up to four crore equity shares. The board of directors has approved a share buyback program of Rs 18,000 crore at a price of Rs 4,500 per share.
The share buyback is the process in which a company buys back its own shares from the market. In this way, the company re-invests in itself. After buying back the shares of the company, the number of outstanding shares in the market decreases. Now as the number of shares decreases, the ownership of each shareholder increases somewhat on a comparative basis.
In simple words, the share buyback is the reverse process of Initial Public Offering (IPO).