Infosys’ ₹18,000-crore share buyback to open on Nov 20

Infosys will open its largest-ever share buyback programme worth ₹18,000 crore on Thursday, with the window remaining open until November 26, the company said in a regulatory filing. The IT major plans to repurchase 10 crore fully paid-up equity shares of face value ₹5 each at a price of ₹1,800 per share, representing up to 2.41 per cent of its total paid-up equity capital.

Infosys said the buyback is being undertaken after assessing its medium-term strategic and operational cash requirements and is aligned with its capital allocation policy. Eligible shareholders can tender their shares between November 20 and 26. This marks the company’s fifth buyback since 2017, when it first repurchased ₹13,000 crore worth of shares. Subsequent programmes included ₹8,260 crore in 2019, ₹9,200 crore in 2021–22, and ₹9,300 crore in 2022–23 through the open market route.

Promoters, including Nandan M Nilekani and Sudha Murty, have opted out of the current buyback, and together hold 13.05 per cent of the company’s equity. Infosys said the move is expected to enhance long-term shareholder value by reducing the equity base, thereby improving key financial metrics such as earnings per share. The company reaffirmed its commitment to return about 85 per cent of cumulative free cash flow to shareholders over five years beginning FY25 through dividends, share buybacks and special dividends.

The current market price of Infosys shares stands at around ₹1,486.40, compared to the buyback offer price of ₹1,800, giving a premium of nearly ₹313 per share. The stock has recorded a 52-week high of ₹2,006.80 and a low of ₹1,307.10.

However, investor gains from the buyback will depend on the acceptance ratio, as only a portion of tendered shares will be bought by the company. Historically, retail investors those holding shares worth up to ₹2 lakh have seen acceptance ratios of 25–35 per cent, while the general category typically receives 10–15 per cent. For instance, at a 20 per cent acceptance ratio, an investor tendering 100 shares would make a profit of ₹6,260, rising to ₹9,390 at 30 per cent and ₹15,650 at 50 per cent. Only the accepted shares fetch assured returns, while unaccepted shares remain in demat accounts and are subject to market fluctuations. Overall gains will therefore depend on both acceptance levels and the subsequent performance of the stock.