TCS share price plunged nearly 6% as the parent Tata Sons sold its stake in India’s IT services giant and the cash cow of Tata group Tata Consultancy Services for an amount worth Rs 8,200 crore. Tata Sons, the promoter of TCS, sold about 2.83 crore which is 1.5% of its stake in the technology arm of Tata group. According to television reports, Tata Sons sold TCS shares at Rs 2,872-2,925 per equity share which is at a discount of 4.2-5.9% from the closing price of Rs 3,052.15 on NSE on Monday. Following the blow, shares of Tata Consultancy Services shed as much as 5.9% to a day’s low of Rs 2,872 on NSE while the stock slumped as low as 5.46% to a day’s bottom of Rs 2,885.2 on BSE.
TCS shares were the biggest drag on both the key equity indices Sensex and Nifty. Following the steep decline in the heavyweight shares of TCS, about Rs 31,901 crore was wiped off from the market capitalisation of the company. At the day’s low price of Rs 2,885.2, TCS held a market capitalisation of Rs 5,84,211.86 crore as against Rs 5,52,310.25 crore. A massive trading volume was observed in the shares of TCS, as at 12:40 pm, more than 4.22 crore shares exchanged hands on both NSE and BSE with about 4.04 crore shares on NSE alone.
Shares of TCS weighed heavily on the benchmark Nifty IT index. Apart from TCS, shares of Mindtree, Infibeam Incorporation, HCL Technologies, Tech Mahindra, OFSS traded in negative territory while, the stocks of Tata Elxsi, Infosys, KPIT and Wipro surged up to 2%. The Nifty IT index traded 1.21% lower at 12,766.8.
This is the second stake sale in TCS by Tata Sons in a span of one year. Last year in the month of May, Tata Sons encashed the opportunity in the TCS’ mega buyback of Rs 16,000 crore. In the biggest buyback programme of India which was open for 13 days, Tata Sons sold shares totalling Rs 10,278 crore.