N Chandrashekaran, the chairman of Tata Sons is extremely proud of Tata Consultancy Services (TCS). Not only was he the former CEO and top boss at TCS but is proud of it being a wealth creator to its shareholders.
And not for nothing, is TCS the crown jewel in the Tata empire. That sense of pride was very evident at the 26th annual general meeting or AGM of the company which was held on June 10.
Classic investment indeed
Addressing a shareholder query, Chandra, as he is fondly called by his TCS colleagues, didn’t blink an eyelid and pointed out that if a person had invested a sum of ₹850 in the TCS initial public offering (IPO) that would now be worth ₹28,000 or translating to a gain of 3,000% all in the 17 years since the behemoth’s listing.
A winner, hands down
There is immense might in what the Tata Sons chairman had had to say. In fact, the TCS stock has outperformed its arch rival, Infosys in terms of returns during the said period beginning July 2004 when TCS got listed on the Indian bourses.
But there is a small math is in order. In July 2004, if you had one share of Infosys, by June 2021 you had 64 shares thanks to five times the company announced a bonus. This included the 3:1 (three shares for 1 share held).
On the other hand, TCS has issued bonus shares only thrice. So, if you had 17 shares allotted to you in July 2004 during the IPO as of June 2021 you will be having a total of 68 shares.
Mask it, TCS style
There was another shareholder query or suggestion rather. The person said that TCS should distribute masks to the company’s shareholders (what next!) with the company’s logo embossed on it. This would be a nice form of marketing, the shareholder opined!
Another shareholder suggested the company utilise its CSR funds for promoting sportspersons.
Beating the pandemic
The TCS management and the chairman sounded extremely upbeat about the company’s prospects.
“We were able to navigate through the pandemic. We have earned the goodwill of our customers as we continually reinvented our product offering,” Chandrashekaran went on to add.
The TCS chairman also said that the company had paid a record ₹33,873 crore as dividend and in share buyback during fiscal year 2020-21.
Rajesh Gopinathan, the MD & CEO noted that the company’s operating margin stood at 25.9% in fiscal year 2020-21 while the net margins were placed at 20.3%. He also said that the company had added a record 40,185 persons in fiscal year 2020-21.