Indian IT giant Infosys witnessed a significant surge in its stock price on Wednesday as investors enthusiastically responded to the company's announcement of its largest-ever share buyback program valued at a massive ₹18,000 crore. The market reaction was immediate and positive, reflecting strong investor confidence in the company's financial health and capital allocation strategy.
Market Reaction and Share Price Performance
Infosys shares climbed 3.74% on the Bombay Stock Exchange, closing at ₹1,541.25, which represented a gain of ₹55 per share from the previous closing. During the trading session, the stock reached an intraday high of ₹1,542.85, marking an impressive 3.85% increase from Tuesday's closing levels.
The National Stock Exchange mirrored this positive trend, with Infosys stock posting an identical 3.74% gain and closing at ₹1,542. This substantial rise in share price had a remarkable impact on the company's overall market valuation, adding ₹23,098.48 crore to its market capitalization, which now stands at an impressive ₹6,40,297.11 crore.
Buyback Program Details and Structure
Under this ambitious buyback program, Infosys plans to repurchase 10 crore fully paid-up equity shares with a face value of ₹5 each. This represents approximately 2.41% of the company's total paid-up equity share capital, making it one of the most significant buybacks in the history of Indian IT sector.
The company has fixed the buyback price at ₹1,800 per share, which represents a substantial premium over current market prices. In a regulatory filing, Infosys clearly stated that "the eligible shareholders can tender their equity shares during the tendering period, i.e. from November 20, 2025, to November 26, 2025."
The buyback program has been strategically designed with two distinct categories: a reserved segment specifically for small shareholders and a general category for other investors. The small shareholder portion will account for 15% of the shares on offer, or the full entitlement due to them, whichever works out to be higher. A small shareholder is defined as one holding shares worth no more than ₹2,00,000 on the record date, and Infosys currently has 25,85,684 such shareholders who stand to benefit from this reserved allocation.
Strategic Rationale and Future Outlook
Infosys explained that "the buyback is being undertaken by the company after taking into account the strategic and operational cash needs of the company in the medium term and for returning surplus funds to the shareholders in an effective and efficient manner in line with its capital allocation policy." This statement underscores the company's commitment to balanced capital allocation while ensuring it maintains sufficient resources for future growth initiatives.
The timing of this buyback announcement comes at a crucial period for the IT sector, which has been facing multiple challenges including global economic uncertainties and changing client spending patterns. By initiating this substantial capital return program, Infosys demonstrates robust financial health and confidence in its future cash flow generation capabilities.
This record-breaking buyback not only rewards existing shareholders but also signals strong management confidence in the company's intrinsic value and long-term growth prospects. The market's positive response indicates investor approval of this strategic move, which effectively utilizes the company's substantial cash reserves while potentially enhancing shareholder value through improved earnings per share and return on equity metrics.
