NEW DELHI– Infosys has received exemptive relief from the U.S. Securities and Exchange Commission (SEC) for its Rs 18,000 crore share buyback program, the company disclosed in a filing to Indian stock exchanges. This marks the IT services major’s first repurchase in nearly three years, following its October 2022 buyback.
The Bengaluru-based firm plans to repurchase shares worth Rs 13,560 crore at Rs 1,800 per share, representing a 19.28 percent premium over its last BSE closing price. The buyback, its fifth overall, now awaits shareholder approval through a special resolution and postal ballot. Historically, Infosys’ buyback processes take three to four months to complete.
Infosys stock rose 1.23 percent on Friday to Rs 1,528, gaining Rs 18. Over the past five sessions, the stock has added Rs 80, up 5.55 percent, and has risen 7.31 percent over the past month. However, shares remain down 21 percent year-on-year.
The company traditionally allocates about 30 percent of its cash reserves to buybacks, repurchasing roughly 14 to 15 percent of its net worth. As of the June quarter, Infosys held Rs 45,200 crore in cash and cash equivalents against a net worth of Rs 95,350 crore. By reducing outstanding shares, the repurchase is expected to improve earnings per share, potentially supporting valuations and attracting new investors.
This move comes as macroeconomic uncertainty weighs on Indian IT stocks. Still, favorable global cues, including expectations of a U.S. Federal Reserve rate cut, helped Indian benchmarks open higher on Friday. At 9:25 a.m., the Nifty gained 39 points, or 0.16 percent, to 25,045, while the Sensex advanced 114 points, or 0.14 percent, to 81,663.
The buyback is seen as both a shareholder reward and a confidence signal at a time of volatile global demand for IT services. (Source: IANS)
