Rs 46,223 crore bounty! Dividends, buyback lift TCS FY24 shareholder payout

Tata Consultancy Services Ltd (TCS) on Friday said its shareholder payout, which included a share buyback and dividends, amounted to Rs 46,223 crore in the FY2024. On Friday, TCS announced a final dividend of Rs 28 per share. This was in addition to Rs 45 per share dividends it announced over the financial year. In total, TCS paid Rs 73 per share in dividends and completed Rs 17,000 crore in share buyback during the financial year. The IT major generated a free cash flow of Rs 44,282 crore in FY24. The shareholder payout was thus 104 per cent of TCS FCF for the year. 

TCS has a policy of returning 80-100 per cent of free cash flow (FCF) to company shareholders. In FY23, its total payouts stood at 110 per cent of FCF.  There was no share buyback by TCS in FY23, but the company declared Rs 115 per share dividend in the previous financial year, amounting to Rs 33,306 crore. TCS shareholder payout in FY24 is thus 38 per cent higher than FY23's. 

TCS last came out with share buyback in 2022. TCS paid Rs 7,686 crore in dividend in FY22 (in addition to Rs 18,000 crore share buyback), Rs 8,510 crore in dividend in FY21 and Rs 25,125 crore in dividend in FY20.

For the March quarter, TCS clocked a 9.14 per cent year-on-year (YoY) jump in consolidated net profit at Rs 12,434 crore. This was against Rs 11,392 crore profit in the same quarter last year. Marketmen, tracking the IT sector, were expecting the largest software exporter to report a 5-6 per cent year-on-year (YoY) jump in net profit.

(More to come)