Infosys has announced its largest share buyback program ever, with the Board of Directors approving a proposal to repurchase equity shares for ₹18,000 crore at ₹1,800 per share. This buyback matches the largest ever share buyback program of IT major TCS announced in 2022.

The buyback price of ₹1,800 per share represents a premium of approximately 19% over the stock's closing price of ₹1,509.50 on the BSE on Thursday. The company intends to buy back 10 crore fully paid-up equity shares with a face value of ₹5 each, representing up to 2.41% of the total paid-up equity share capital.

This buyback will be executed through a tender offer, covering all eligible shareholders proportionately as of the record date. The company will seek shareholders' approval to proceed with the buyback program.

This marks the fifth buyback exercise for Infosys, exceeding previous buybacks of ₹13,000 crore in 2017, ₹8,260 crore in 2019, ₹9,200 crore in 2021, and ₹9,300 crore in 2023. The company's first share buyback was in 2017, when it repurchased 11.3 crore shares, representing up to 4.92% of the paid-up equity share capital, at ₹1,150 per share, totaling approximately ₹13,000 crore.

Analysts believe this move signals confidence in Infosys's long-term cash flows and growth prospects, even amidst muted revenue growth expectations for the current fiscal year. The buyback is expected to strengthen key financial metrics such as earnings per share (EPS) and return on equity (ROE), while offering shareholders tax-efficient returns compared to dividends. Furthermore, the program will help Infosys optimize its capital structure by deploying excess cash reserves.

Infosys has a history of returning excess cash to shareholders, with a policy of returning approximately 85% of free cash flow over a 5-year period through dividends and/or share buybacks, subject to applicable laws and approvals. At the end of June 2025 quarter, the company reported a free cash flow of $884 million (around ₹7,805 crore).

Kotak analysts suggest that the buyback indicates the stock may be undervalued, as it fell 24% year-to-date in 2025. As of June 2025, promoters held 14.61% of Infosys, Foreign Institutional Investors (FIIs) held 31.92%, Domestic Institutional Investors (DIIs) held 39.6%, and mutual funds owned the remaining shares.

The buyback comes at a time of heightened pressure on IT stocks due to the worsening global macroeconomic situation. The company has guided for just 1-3% revenue growth in constant currency terms for the current fiscal, underlining the subdued near-term outlook.