Infosys Buyback Plan Analyzed

Infosys, a big IT company in India, has decided not to use money from a planned buyback of its own shares. This means the company’s top leaders, including Narayana Murthy and Nandan Nilekani, won’t be buying back the shares. This change could affect how investors see the company’s financial health.

Key Points

• Infosys leaders won’t participate in the Rs 18,000 crore buyback.
• The buyback aims to return cash to shareholders – investors.
• This affects the share price and investor confidence currently.
• Promoters hold 13.05% of the company’s shares, a significant portion.
• The company intends to return 85% of free cash flow over 5 years.
• Previous buybacks totaled Rs 27,300 crore in the last decade.

The company plans to buy back 100 million shares at an average price of Rs 1,800. They believe this is the best way to return money to shareholders. The company is facing economic uncertainty, which can impact how much investors are willing to pay for the company’s shares.

Narayana Murthy owns 0.36% of Infosys, while Nandan Nilekani owns 0.98%. Sudha Gopalakrishnan, Kris Gopalakrishnan’s wife, is the largest individual promoter shareholder with 2.3% ownership. These large shareholders have a significant influence on the company’s decisions.

Previously, Infosys bought back shares totaling Rs 27,300 crore over the last ten years. Their last buyback in 2022 was Rs 9,300 crore. This new buyback is part of a strategy to return cash to investors consistently.

“Returning capital to shareholders is a key priority for Infosys.”