Infosys hits six-year high as company to consider share buyback
Besides considering a share buyback proposal, the IT services giant's board will also mull its March quarter earnings and final dividend on 14 April
Mumbai: Infosys Ltd stock gained as much as 3% to hit a six-year high on Monday after the country's second-largest IT services firm said its board would consider a share buyback programme on 14 April. However, the stock later pared gains in a weak market and was down 1.5% at ₹1419. The benchmark index, Sensex, cracked over 3%.
The stock has risen around 125% in the last one year against a gain of 54.92% in Sensex.
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"The Board of the Company will consider a proposal for buyback of fully paid-up equity shares of the Company at its meeting to be held on April 14, 2021, in accordance with the Securities and Exchange Board of India (Buy-back of Securities) Regulations, 2018," the company said in a statement on Sunday.
The IT services giant will also consider its March quarter earnings and final dividend.
"We expect Infosys to report quarter-on-quarter growth of 2.2-3.9% in March quarter, maintaining strong revenue growth momentum from December quarter. Cloud, digital transformation, automation, artifical intelligence and cybersecurity continue to see healthy demand" said Emkay Global Financial in a note to its investors.
"Deal wins remain healthy across the companies and expect Infosys to guide for 12-15% on a year-on-year basis in constant currency revenue growth and 22-24% EBITM for FY22," the Emkay note added.
According to 15 Bloomberg analyst estimates, the firm is expected to post a revenue of ₹26,397.90 crore, while net profit is estimated at ₹5,168.30 crore.
In 2017 and 2019, Infosys bought back shares worth ₹13000 crore and ₹8260 crore at ₹1150 and ₹800 per share respectively.
In September 2019 and December 2017, Infosys had completed ₹8,260 crore and ₹13,000 crore buyback.
As of March 2020, Infosys has cash and cash equivalent at ₹18,649 crore.
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