Noida-based information technology firm HCL Technologies on Wednesday said it would buy back shares ₹1,000 apiece, a 17 per cent premium over the current trading price.

“The company is proposing an offer for buyback of equity of face value of ₹2 each for cash at a price ₹1,000 an equity share on a proportionate basis through the tender offer process in accordance with the provisions of Sections 68, 69 and 70 and all other applicable provisions,” the company said in a filing to BSE.

The buyback size is ₹3,500 crore, representing 16.39 per cent and 13.62 per cent of the aggregate of the fully paid-up equity share capital and free reserves as per the standalone and consolidated audited accounts of the company for the financial year ended March 31, 2016 , it said.

Letter of Offer

The buy buyback offer price is about 17 per cent higher than the current trading price of the stock at ₹852.35 a share. The company said ‘Letter of Offer’ will be sent to equity shareholders on the record date — May 25.

The board of directors passed a resolution on March 20, and shareholders, through postal ballot notice on April 6, approved the proposal for buyback of equity shares of face value of ₹2 each, HCL Technologies said.

In line with current trend

The company published a public announcement on May 17 and 18, pursuant to the provisions of the related regulations.

The country’s fourth largest IT firm’s announcement comes in accordance to the trend that is going on in the Indian IT industry as the companies are under pressure to return excess cash in their books to shareholders through generous dividends and buybacks.

For instance, India’s largest software services firm, TCS, announced its ₹16,000-crore mega buyback offer, which is underway right now. Infosys has also announced its capital allocation policy to return up to ₹13,000 crore this financial year through dividend and/or buyback.