Mumbai: IT major Infosys will open its share buyback window tomorrow, marking what is set to be the largest such programme in the firm’s history. The buyback is structured at a size of Rs 18,000 crore, with the window running from 20 November to 26 November.
Key details of the buyback
The company has fixed the buyback price at ₹1,800 per share, which reflects a premium of over 19 percent relative to the share price level when the announcement was made.
Infosys has offered to repurchase 10 crore fully paid-up equity shares, each with a face value of ₹5, which represents approximately 2.41 percent of its total paid-up equity share capital.
Category-wise allocation
The buyback has been divided into two categories:
A reserved segment for small shareholders (those holding shares valued at ≤ ₹2 lakh as on the record date), which will amount to 15 percent of the total number of shares proposed to be bought back or their entitlement, whichever is higher. On the record date, 14 November, around 25.85 lakh small shareholders qualified.
The general category (all other eligible shareholders) will have a different entitlement ratio: 17 shares for every 706 shares held, while the small shareholder category will be entitled to 2 shares for every 11 held.
Why retail investors should be upbeat
Analysts point to several positive signals for the retail investor community:
The company’s promoter and promoter-group (which held 14.30 percent as of 30 September 2025) have declined to participate in the buyback. This non-participation means better entitlement ratios for public shareholders, especially retail investors.
Some view this as a “vote of confidence” by the promoter group in the company’s future prospects, which may further bolster investor sentiment in the IT sector.
Since the buyback is being fully funded through internal cash reserves and free-cash-flow generation, it signals financial strength and prudent capital allocation.
Tax and strategic considerations
However, potential participants should be mindful of the following:
Since October 2024, buyback proceeds are treated as a deemed dividend for tax purposes in India, meaning they are taxed at the shareholder’s applicable slab rate. This tax treatment may reduce the attractiveness for high-tax-bracket investors.
From a company-fundamentals perspective, while Infosys continues to win deals and has reasonably stable revenue visibility, growth momentum and margin expansion remain modest. The buyback could help improve return on equity and reduce share count among long-term shareholders who choose not to tender.
Market reaction
Following the announcement, Infosys shares rose nearly 4 percent on the day, making them the top gainer on the Nifty IT index, which itself was up approximately 3 percent.
