Infy stock gains 4.5% on news of ₹10,000crore share buyback

BENGALURU: Infosys Ltd shares surged 4.5% on Thursday after India’s second-largest software services exporter said its board will consider a share buyback on August 19—the first stock repurchase in its 36-year history.

Infosys’s board will meet on Saturday to take up the proposal, the company said in a filing to stock exchanges on Wednesday. The company’s shares rose to ₹1,021.15 at the close of trading on the BSE; the Sensex edged up 0.08% to 31,795.46 points.

Although Infosys has not disclosed the details of its buyback, including the price at which it will buy shares, two executives familiar with the development said the size will be at least ₹10,000 crore.

“The board of directors will consider a proposal for buyback of equity shares of the company at its meeting to be held on August 19, 2017,” Infosys said in a statement.

On April 15, while declaring its earnings for the fourth quarter, Infosys disclosed that it had decided to pay out ₹13,000 crore to shareholders through dividends and/or a share buyback. Infosys also said that the company would use 70% of its free cash flows (as against 63% earlier) to award dividends or buy back shares, starting this year.