The following table illustrates the pre-buyback shareholding pattern of TCS as on Feb 17, 2017

Shareholder category

No. of Shareholders

No. of Shares (in crore)

% of Shares

Promoter Companies

10

144.45

73.31%

DFIs / Banks / MFs

456

10.45

5.31%

FIIs / FPIs / NRIs / OCB

13,734

33.28

16.89%

Resident Individuals and others

618,734

7.49

3.80%

Clearing Members

1,141

0.19

0.10%

Body Corporates / NBFCs / Trusts / LLPs

2,900

1.18

0.59%

Total

636,975

197.04

100.00%

Source: TCS Exchange Filing

As the table above suggests the promoter group consisting of Tata Sons principally and a few group companies own nearly 73.31% of TCS. Since this is a proportionate buyback, even if all the shareholders tender their shares in the said proportion, the post-buyback stake of the TCS promoters will continue to remain at 73.31%. Thus from the Tata Sons point of view there will be no dilution of equity stake in the event all shareholders including the promoters participating in the buyback offer. But what is more likely to happen is that institutions, HNIs and retail investors may look to exit their holdings in a bigger proportion as the price of Rs.2850/- is very attractive as it is closer to the recent highs touched by TCS. For most of the institutional investors this move will enable them get out of the stock at its high price. In that event if the Promoter Group chooses to forfeit its buyback rights to the other shareholders then the promoters will end up holding 144.45 crore shares out of a reduced paid-up capital of 194.19 crore shares thus resulting in the promoter group’s stake in TCS increasing from the current level of 73.31% to 74.39%.