Infosys shares surge after record Rs 18,000-crore buyback announcement

Infosys shares rose over 2 per cent in early trade on Friday after India’s second-largest IT services company approved its biggest-ever share buyback programme worth Rs 18,000 crore.

At around 9:45 a.m., the stock was trading at Rs 1,539.90 on the NSE as investors cheered the buyback announcement, which came after market hours on Thursday. The buyback price has been set at Rs 1,800 per share — about 19 per cent above Thursday’s closing of Rs 1,509.70 — and will cover 10 crore shares, representing 2.41 per cent of the company’s equity capital. The record date has yet to be announced.

This is Infosys’s first buyback since 2022, when it repurchased Rs 9,300 crore worth of shares. The Bengaluru-based company said in an exchange filing it had received exemptive relief from the US SEC for the tender offer due to conflicting Indian and US regulations. With cash and cash equivalents of over Rs 42,000 crore and free cash flow of more than Rs 20,000 crore in FY25, Infosys will fund the buyback from free reserves in line with its policy of returning 85 per cent of free cash flow over five years via dividends and repurchases.

The stock has gained more than 6 per cent in the past five sessions and 8 per cent over the past month, but remains down about 3 per cent in the past six months and more than 18 per cent year to date.

Brokerage reaction mixed but upbeat

CLSA reiterated an ‘Outperform’ rating with a target price of Rs 1,861, implying an upside of more than 23 per cent from Thursday’s close. It said the buyback should support the stock during a weak second half of FY26.

Nomura maintained a ‘Buy’ call with a target of Rs 1,880, expecting constant-currency revenue to grow 3.8 per cent on-year in FY26. Morgan Stanley kept an ‘Equal-weight’ stance with a target of Rs 1,700, but noted the buyback size was larger than its Rs 10,000–14,000 crore estimate and signalled confidence in Infosys’s FY26 guidance despite macro risks.

In Q1 FY26, Infosys reported an 8.7 per cent year-on-year rise in consolidated net profit to Rs 6,921 crore on revenue of Rs 42,279 crore, up 7.5 per cent. The company raised its FY26 constant-currency revenue growth forecast to 1–3 per cent from 0–3 per cent earlier, while maintaining its operating margin guidance at 20–22 per cent.

Analysts said the record buyback and stronger guidance underscore Infosys’s cash-generating ability and could underpin the stock price in the coming quarters.