TCS Mega Buyback Alert! 💸 Unleash Your Portfolio Power with Premium Shares at Rs 4,150 📈 | Investor Insights 🌐 #TCS #InvestingRevolution #StockMarketBuzz

The TCS share buyback for 2023 is set to commence today, marking a significant move by the IT giant. In October, alongside its quarterly results, Tata Consultancy Services Ltd (TCS) had expressed its intention to initiate a buyback of shares valued at Rs 17,000 crore. The buyback will occur at a premium price of Rs 4,150 per share through the tender route. Analysts have highlighted that small shareholders, owning a maximum of 57 shares as of the record date on November 25, have the opportunity to participate in the buyback and capitalize on the difference between the current market price and the buyback price.

TCS has officially stated that the entitlement ratio for small investors is 17 percent. Sharekhan, however, points out from past experiences that not all shareholders typically engage in buybacks, and the final acceptance ratio may range between 30-35 percent. Sharekhan further suggests that existing shareholders, holding TCS shares for long-term investments valued at less than Rs 2 lakh on the record date, could opt for the buyback route. They can tender a maximum of 57 shares to avail themselves of the premium buyback price of Rs 4,150.

Following the buyback settlement, investors have the option to repurchase the same number of shares accepted in the buyback at the prevailing market price for long-term investment. They can also continue holding the unaccepted shares in their portfolio, according to Sharekhan. Given the potential acceptance ratio and the possible upside for retail/small investors, Sharekhan recommends tendering shares in the buyback. Post-buyback, investors can reinvest in the same number of accepted shares at a relatively lower prevailing market price. Sharekhan maintains a 'Buy' rating on TCS with an unchanged price target (PT) of Rs 4,200. Reflecting on TCS's buyback history, Investors  notes a 100 percent acceptance ratio in previous TCS share buybacks in 2017, 2018, and 2020.

However, the acceptance ratio was around 24 percent in the last share buyback in 2022. While the official entitlement ratio is 17 percent for small investors, Sharekhan emphasizes that past experiences indicate a potential final acceptance ratio of 30-35 percent. For small investors, the option to tender one equity share is available for every six shares held on November 25. Other eligible shareholders can tender two shares for every 209 equity shares held on the record date.