HCL Tech shares rise over 3%on share buyback proposal1 min read . Updated: 10 Jul 2018, 05:03 PM IST
HCL Tech shares rose as much as 3.47% today to ₹995 after the company said its board of directors will consider share buyback in a meeting on 12 July
New Delhi: Shares of HCL Technologies or HCL Tech rose as much as 3.47% today to ₹ 995 on NSE after the IT company said its board of directors will consider share buyback in a meeting on 12 July. HCL Tech shares closed 1.92% up at ₹ 980, while the Nifty 50 rose 0.87% to ₹ 10,947.25. Details of HCL Technologies share buyback are expected to be firmed up on 12 July when its board will meet to discuss the proposal.
It had last year offered buy-back of shares at Rs1,000 apiece, a 17% premium over its prevailing trading price at that time. The buy-back size was Rs3,500 crore, representing 16.39% and 13.62% of the aggregate of the fully paid-up equity share capital and free reserves as per the standalone and consolidated audited accounts of the company for the financial year ended 31 March, 2016.
According to Edelweiss Securities, HCL Tech is estimated to clock 1.7% constant currency revenue growth in the June 2018 quarter and margin is expected to remain flat. “Management is expected to maintain revenue growth and margin guidance for FY19. Traction in ER&D business, strategy behind acquisitions, update on IP deals and outlook on IMS business are key monitorables", added Edelweiss.
In the March 2018 quarter, HCL Technologies posted a 9.8% decline in its consolidated net profit at Rs2,230 crore. The net profit is lower from Rs2,474 crore reported in the year-ago period (as per Indian Accounting Standards) as there was a one-time benefit from tax reversal in the January-March 2017 quarter.
The announcement comes within a month of Tata Consultancy Services Ltd, the country’s largest software exporter, declaring a ₹ 16,000 crore share buy-back programme. It had offered to buy-back shares at a premium of over 15%, at ₹ 2,100 a share.