Tanla Platforms shares fall over 4% ahead of Board Meeting for share buyback proposal

Shares of Tanla Platforms declined over 4 percent on Monday, June 16, 2025, as investors reacted ahead of the company’s board meeting to consider a fresh proposal for the buyback of equity shares. The stock fell as much as 4.1 percent intraday to a low of ₹637.70 on the NSE, amid anticipation of the corporate action. Despite this fall, the counter has gained steadily since March, though it continues to trade over 41 percent below its 52-week high of ₹1,086.05 recorded in July 2024.

In a regulatory filing, Tanla Platforms confirmed that its board would meet on June 16 to evaluate the share buyback proposal. The company said the meeting would be conducted in accordance with applicable laws, including the Companies Act, 2013, and SEBI’s Buy-back of Securities Regulations, 2018.

Third Buyback Proposal in Recent Years

If approved, this will mark the third share repurchase initiative by Tanla Platforms in the last five years. The Hyderabad-based cloud communications provider had previously undertaken a buyback in 2020, returning ₹154 crore to shareholders at a price of ₹1,200 per share. This was followed by a larger buyback of ₹170 crore in 2022, again at the same price of ₹1,200 per share.

Share buybacks are typically viewed as a sign of confidence by the management in the company’s future prospects. These actions reduce the outstanding share count, which can boost metrics like earnings per share (EPS) and return on equity (RoE). They are also considered an efficient means of returning excess capital to shareholders without triggering tax obligations typically associated with dividends.

Buyback Comes After Tepid Q4 Performance

The timing of the buyback proposal follows the company's recent announcement of its Q4 FY25 earnings. For the quarter ended March 2025, Tanla Platforms reported a 9.9 percent year-on-year decline in net profit to ₹117.3 crore, down from ₹130.2 crore in Q4 FY24. Revenue saw a marginal growth of 1.9 percent, reaching ₹1,024.4 crore compared to ₹1,005.5 crore a year earlier. EBITDA also rose 1.9 percent to ₹163.4 crore, maintaining a steady EBITDA margin of 16 percent.

Despite the softness in profitability, the board had declared a second interim dividend of ₹6 per equity share for FY25, with the record date set as April 30, 2025. This indicates the company’s continued intent to return capital to shareholders even as earnings remain under pressure.

Stock Performance Remains Volatile

While Tanla Platforms has been underperforming on a yearly basis, with the stock falling over 31 percent in the past 12 months, recent months have shown a reversal in trend. The stock rose 30.6 percent in May, 1.5 percent in April, and 7 percent in March. This recent uptrend follows a prolonged six-month decline between August 2024 and February 2025, during which bearish sentiment prevailed.

The stock’s 52-week low stands at ₹409.40, touched in March 2025, highlighting the extent of the correction it witnessed before the recent recovery phase. The renewed buyback proposal could play a role in providing further support to the stock if the terms are favourable.

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