Thomas Cook board approves Rs 150 crore share buyback scheme

“The perceived negative impact of the Corona Virus on travel businesses has affected the Company’s share price and hence, the buy-back signals to shareholders the Management’s confidence in the strong fundamentals and growth prospects of the company,” the company statement said.

The majority shareholder, Fairbridge Capital Mauritius Limited (A Fairfax Group company) will not participate in the buy-back, the company said.

"The buyback scheme is primarily intended to increase shareholder value as the income arising to the shareholder on account of buyback of shares is exempt from tax," said Madhavan Menon, Chairman & Managing Director, Thomas Cook (India) Ltd.

The buyback will signal confidence to company's shareholders and unlock the underlying value of the diversified Thomas Cook India Group, he added.

"The combined impact of a sluggish economy and difficult trading conditions due to the prolonged direct impact of the coronavirus have resulted in slowing demand across our businesses. Given that this coincides with the peak booking season for the summer vacations, we anticipate a cascading negative impact on our results," Menon noted.

That said, the company is confident that its strong fundamentals and financial position will see it through the current challenging environment, he added.

"We are focussed on taking all necessary measures to ensure our sustainability and long term growth," Menon said.

At 9:50 am, shares of Thomas Cook (India) traded 0.90 percent down at Rs 49.75 apiece on the BSE.