NEW DELHI: On Friday, shares of Tata Consultancy Services (TCS), the country's largest IT outsourcing company, zoomed 7 per cent closing at Rs 3,406.40 on BSE. TCS stock was the biggest gainer on both the indices during the last trading day of the week. The company's market capitalisation or m-cap moved up by Rs 41,300.92 crore to Rs 6,52,082.92 crore (above $99 billion), thus becoming the first Indian company to near valuation of $ 100 billion.
By definition, market capitalisation is the value of a company that is traded on the stock market, calculated by multiplying the total number of shares by the present share price.
The rise in the TCS scrip's fortune came after the IT behemoth posted a rise of 4.5 per cent in its Q4 net profit. In the January-March quarter, the company reported a net profit of Rs 6,925 crore, up 4.57 per cent against Rs 6,622 crore posted in the same quarter last year. On top of that, the company announced a 1:1 bonus for its shareholders. This is the third bonus share offering by the company since its listing in 2004. TCS had allotted 1:1 bonus shares in 2006 and 2009.
The company also paid a dividend of Rs 29 per share. Market players said that the bonus offering is a tax-inefficient way of rewarding shareholders as, thanks to a Supreme Court order, there are higher tax implications for the first half of bonus shares while the second half of the lot becomes tax-free.