TCS shares fall 3% amid block deal by Tata Sons

Shares of Tata Consultancy Services Ltd (TCS) tumbled during the trading session on Tuesday amid the reported bulk deal by its promoter entity Tata Sons. The stock was the biggest laggard in the headline indices, falling 2.98 per cent to Rs 4021.25 for the day, with its market capitalization of more than Rs 14.5 lakh crore.

Tata Sons, the holding company of TCS, is looking to sell 2.34 crore shares or 0.65 per cent stake in the largest software exporter in the country to raise a total of Rs 9,300 crore (or $1.1 billion). Floor price for the issue was set at Rs 4,001 apiece, discount of 3.45 per cent from its previous close. JP Morgan has been appointed as the banker for the issue.

About 2.48 crore shares of TCS, amounting to Rs 9,976 crore were traded on BSE as of 9.30 am. Similarly, 40.8 lakh shares of the software major amounting to Rs 1,646 crore exchanged hands of NSE at the same time. The heavy trading volumes of the exchanges suggest that the deal was executed but Business Today independently could not verify the same.

As of December 31, 2023, Tata Sons owned 72.38 per cent, or 2,61,88,99,419 equity shares in Tata Consultancy Services. In December, Tata Sons raised nearly Rs 12,300 crore by tendering shares of TCS in its Rs 17,000 crore buyback.

The holding company of the salt-to-software conglomerate is selling its stake in TCS to reduce its debt, fund semiconductor capex and restructure its balance sheet to avoid mandatory listing under RBI's 'upper layer' NBFC norms. Recently, news reports were floating that Tata Sons shunned its IPO plans.