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Infosys, one of India’s largest IT services companies, is expected to announce a share buyback worth Rs 10,000–15,000 crore today; Know details
Infosys Share Buyback (File Photo)
Infosys, one of India’s largest IT services companies, is expected to announce a share buyback worth Rs 10,000–15,000 crore today, representing about 3% of its outstanding equity. This will be the fifth buyback since its listing, and investor focus remains on how the stock will react post-announcement.
Mixed Track Record on Past Buybacks
The company’s first buyback in 2017, worth Rs 13,000 crore, saw the stock decline 7% in the first month but recover to post 13% gains over six months, according to reports. The method of buyback—tender offer versus open market—will be closely watched:
- Tender Offer: Shares are purchased from existing shareholders at a fixed premium to market price, within a set timeframe.
- Open Market: The company buys shares directly on exchanges at prevailing prices, without guaranteeing a premium.
Infosys’ last buyback in 2022 was via the open market at Rs 1,850 apiece.
Current Stock & Valuation
On Thursday, Infosys shares slipped over 1.25% to Rs 1,513, dragging its market capitalisation below Rs 6.3 lakh crore. The stock is down nearly 20% over the past year and is trading about 25% below its 52-week high of Rs 2,006.80.
The consensus target price for Infosys stands at Rs 1,743, implying a potential upside of 15%. The most bullish estimate pegs the stock at Rs 2,085, about 38% higher. Analysts suggest the buyback price could be set at a 25–30% premium, likely in the Rs 1,800–1,900 range.
Financial Capacity for Buyback
- Equity capital & reserves: Rs 95,819 crore (including Rs 2,074 crore paid-up equity and Rs 93,745 crore reserves).
- Cash & equivalents: Rs 45,200 crore.Historically, Infosys has spent ~12% of its equity and reserves, implying a potential buyback size of ~Rs 11,500 crore. If the company uses ~30% of its cash reserves, the figure could rise to ~Rs 13,560 crore.
Other Business Updates
Infosys announced that its subsidiary Infosys Finacle, part of EdgeVerve Systems, and PT Bank CTBC Indonesia (a subsidiary of Taiwan’s CTBC Group) successfully deployed the Finacle Digital Banking Solution Suite on a cloud-hosted model. The deployment will enhance operational efficiency, scalability, and speed to market for new offerings.
Hong Kong-based brokerage CLSA noted that Infosys’ buyback could create incremental pressure on peer Tata Consultancy Services (TCS) to consider a similar move as a confidence-building measure in the current weak demand environment. TCS last conducted a share buyback in December 2023.
Aparna Deb is a Subeditor and writes for the business vertical of News18.com. She has a nose for news that matters. She is inquisitive and curious about things. Among other things, financial markets, economy, a…Read More
Aparna Deb is a Subeditor and writes for the business vertical of News18.com. She has a nose for news that matters. She is inquisitive and curious about things. Among other things, financial markets, economy, a… Read More
September 11, 2025, 13:53 IST
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