Infosys shares up 2% on record buyback plan. Will existing shareholders benefit?

Following the approval of a Rs 18,000 crore share repurchase by the company’s Board, Infosys shares surged more than 2% in early trading on Friday, hitting Rs 1,544.65 per share.

Repurchasing up to 10 crore fully paid-up equity shares, or 2.41% of the total paid-up equity capital, will be the largest repurchase in Infosys’ history. The repurchase price is Rs 1,800 per share, which is 19% more than the BSE’s closing price of Rs 1,509.50 on Thursday.

According to Infosys’ regulatory filing on September 11, “The Buyback Size does not exceed 25% of the aggregate of the paid-up capital and free reserves, based on the latest audited interim condensed standalone and consolidated financial statements of the Company as on June 30, 2025.”

At the end of the June 2025 quarter, the corporation recorded $884 million (about Rs 7,805 crore) in free cash flow. The buyback’s record date has not yet been disclosed. This is the fifth and biggest buyback by Infosys.

The shares were repurchased at a maximum price of Rs 1,850 each during the previous buyback in 2022, which had a valuation of Rs 9,300 crore. The share price of Infosys has fluctuated, rising 7.6% in the last month but losing 5% in the last three months and 19% so far this year. The stock has dropped 21% in the last year, although it has up 2% in the last two years and 62% in the last five.

Shailesh Bhatnagar said , “18,000 crores at about 1800 rupees, which is 19% higher. Remember, this is good for existing shareholders. There have been tweaks in the market laws governing buybacks as far as income tax is concerned. So if you’re thinking of buying from the market at 1534 today and selling it to the company at 1800, well, there is always that slip between the cup and the lip. It’s quite a battle for you. So please consult your CA on the new rules that govern these buybacks.”

Despite the apparent opportunity, analysts advise caution regarding the practical execution of the buyback for retail investors.

Mayuresh Joshi, Head Equity Research at William O’Neil India, commented, “No, I think it’s not that simple. What you’re probably looking at is the price has got announced. But how much of tendering happens at that price is something to be seen. So again, I think it’s all good on paper. But when you try to execute that, it’s not that simple.”

At the end of the June 2025 quarter, the corporation recorded $884 million (about Rs 7,805 crore) in free cash flow. The buyback’s record date has not yet been disclosed. This is the fifth and biggest buyback by Infosys.

The shares were repurchased at a maximum price of Rs 1,850 each during the previous buyback in 2022, which had a valuation of Rs 9,300 crore. The share price of Infosys has fluctuated, rising 7.6% in the last month but losing 5% in the last three months and 19% so far this year. The stock has dropped 21% in the last year, although it has up 2% in the last two years and 62% in the last five.