Shares of Infosys Ltd rallied nearly 4% on October 23, emerging as the top Nifty gainer, after the company confirmed that its promoter and promoter group would not participate in its ₹18,000 crore share buyback announced in September. The strong rally in Infosys also helped the Nifty IT index climb 2.4%, making it the top-performing sectoral index of the day.

At 10:05 a.m., Infosys shares were trading at ₹1,533 apiece, up 4%, reflecting strong investor sentiment following the announcement.

Promoters Hold 13.05% Stake, Choose Not to Participate

Infosys stated that its promoter group, which collectively holds 13.05% of the company’s equity, had formally expressed their decision not to participate in the buyback through letters submitted between September 14 and September 19, 2025.

“Pursuant to the proposed buyback and depending on the response, the voting rights of the promoters and promoter group may change,” Infosys said in its filing.

The decision not to tender shares was made by key promoters, including founder N R Narayana Murthy, his wife Sudha Murty, and co-founder Nandan M. Nilekani along with their families. Other co-founders and their family members are also part of the promoter group.

Market experts believe this move sends a positive signal.

“The promoters’ decision to opt out of the buyback signals confidence in future prospects and improves the entitlement ratio for retail investors,” said Saurabh Jain, Assistant Vice President of Retail Equities at SMC Global.
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Infosys’ Largest-Ever Buyback Worth ₹18,000 Crore

The Infosys board, in its September 11, 2025 meeting, approved the company’s largest-ever buyback program, valued at ₹18,000 crore.

Under this buyback, Infosys plans to purchase 10 crore fully paid-up equity shares with a face value of ₹5 each, representing 2.41% of the total paid-up share capital, at a price of ₹1,800 per share.

According to the company’s filing, the buyback aims to return surplus cash to shareholders efficiently, keeping in mind strategic and operational cash needs in the medium term.

Capital Allocation Policy and Shareholder Value

Infosys reiterated its Capital Allocation Policy, which aims to return around 85% of cumulative free cash flow over a five-year period, through semi-annual dividends, share buybacks, or special dividends, subject to necessary approvals.

The company also stated that it intends to gradually increase its annual dividend per share, excluding any special dividends.

The buyback, Infosys said, is expected to enhance long-term shareholder value by reducing the equity base and efficiently utilizing excess cash reserves.

A History of Consistent Buybacks

This marks Infosys’ fifth share buyback since 2017.

2017: The first buyback worth ₹13,000 crore, with 11.3 crore shares purchased at ₹1,150 per share.
2019: The second buyback was worth ₹8,260 crore.
2021: A buyback valued at ₹9,200 crore.
2022: The fourth buyback worth ₹9,300 crore, conducted via the open market route at a maximum price of ₹1,850 per share.

With the new ₹18,000 crore buyback, Infosys has doubled the scale of its previous programs, reinforcing its strong cash position and commitment to capital efficiency.

Market Impact

The Nifty IT index climbed 2.4% following the surge in Infosys shares, making it the top-performing index on October 23. Analysts believe the promoters’ non-participation and the record buyback size boosted investor confidence, signaling the company’s robust financial health and long-term growth outlook.

Key Highlights

Infosys stock rose 4% to ₹1,533 after promoters opted out of the buyback.
₹18,000 crore marks Infosys’ largest-ever share repurchase.
Promoters hold 13.05% but chose not to tender shares.
Nifty IT index surged 2.4%, led by Infosys gains.
The buyback aligns with Infosys’ capital allocation policy to return 85% of free cash flow over five years.

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