Infosys buyback: The record date for IT bellwether Infosys' ₹18,000 crore buyback is later this week, thus offering investors a sort of last chance to participate in the mega offer.
Infosys buyback record date is Friday, November 14. This means that only those shareholders who hold Infosys stock on or before November 14, 2025, are eligible to participate in the buyback. Given the T+1 settlement system, investors need to purchase Infosys shares by November 13.
Infosys buyback details
Infosys' buyback is being conducted via the tender offer route, with the company fixing the buyback price at ₹1,800 per share, which represents over an 18% premium to the last closing price of ₹1,514.60 on the BSE on Monday.
Infosys will repurchase up to 10 crore equity shares, representing 2.41% of the company's paid-up equity share capital. The buyback offer is open to all shareholders, with 15% reserved for small investors.
Eligible shareholders can tender their shares during the five working-day tendering period, which will commence within two working days of the dispatch of the Letter of Offer. Infosys will provide the Letter of Offer and the tender form within two working days of the record date, the company had announced.
This latest buyback announcement comes after a gap of three years and is the largest in the company's history. The move comes at a time when Infosys' stock has been under pressure, having lost about 25% from its recent highs amid headwinds in the IT sector.
Meanwhile, Infosys has confirmed that its promoters and promoter group, including Nandan M. Nilekani and Sudha Murthy, will not participate in the company's largest buyback to date.
Should retail investors participate in Infosys' buyback?
While the promoters have decided to refrain from tendering their shares in the buyback, the question remains if it's a lucrative opportunity for the retail investors.
Analysts believe that Infosys' buyback offers an immediate arbitrage opportunity for retail investors, but the decision to participate is now complicated by significant tax changes.
Since October 2024, the entire amount received from the buyback is now taxed as a "deemed dividend" under the shareholder's individual income tax slab rate (which can be as high as 30% plus surcharge and cess). This is a critical departure from the earlier regime, where such proceeds were tax-exempt for investors.
View from Santosh Meena, Head of Research at Swastika Investmart, said that for high-income earners in the top tax bracket, the post-tax gain from the buyback may be less attractive, or even result in a loss, compared to selling the shares in the open market and paying the standard 10% Long-Term Capital Gains (LTCG) tax only on the profit component. "Therefore, tax efficiency must override the premium appeal for higher-slab investors."
As for small shareholders, those holding shares worth up to ₹2 lakh, the calculus leans positive due to the high likelihood of acceptance, said the analyst.
"SEBI mandates a 15% reservation for this category, historically leading to acceptance ratios that far exceed the general category. This advantage is amplified by the fact that Infosys promoters, including co-founders Narayana Murthy and Nandan Nilekani, have stated they will not participate in the buyback, effectively increasing the pool of shares available for other investors. This scenario creates a strong short-term opportunity to sell a portion of one's holding at a guaranteed premium of more than 15% over the recent market price," opined Meena.
While its true that the acceptance ratio for retail investors is typically higher than for institutional categories, investors must remember that past buybacks have seen only partial acceptance, leaving the rest exposed to market volatility once the tender window closes.
Now, if an investor is looking to buy Infosys shares ahead of the buyback record date for gains, Vinod Nair, Head of Research, Geojit Investments sees limited opportunity "given the low acceptance ratio with a high retail investor base of more than 28 crore shares".
Harshal Dasani, Business Head, INVAsset PMS, believes that Infosys is on a recovery path with an improving large-deal pipeline and easing attrition.
"For investors with a long-term view, holding may yield better compounding benefits; for short-term investors seeking low-risk gains, partial participation makes sense," he opined.
Infosys stock outlook
Overall, the outlook for the IT sector remains clouded amid global economic uncertainty and tighter client budgets, particularly in the US and Europe. This has moderated near-term growth guidance for these firms.
"However, long-term prospects are positive, supported by ongoing digital transformation, AI integration, and cloud adoption. Infosys stands out with 2.9% YoY CC growth despite a subdued industry environment," opined Nair. With valuations around historical averages, the stock appears attractive for long-term investors, he added.
source: mint
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