BackInfosys stock in focus as IT major to consider share buyback today
Infosys has informed exchanges that its board is going to consider buyback of shares in meeting scheduled on13th October 2022
PremiumInfosys shares will be one of the stocks in focus today as the board of directors of the IT major is going to consider buyback of shares today. Infosys had informed Indian stock market exchanges in this regard. The It major informed that company board would consider buyback of share in its board meeting scheduled on 13th October 2022.
Infosys share buyback
Informing Indian stock market exchanges about share buyback proposal, Infosys Ltd said, "In continuation to our letter dated September 16, 2022, with regard to notice of the meeting of the Board of Directors (“Board") of Infosys Limited (“Company"), we would like to inform you that pursuant to Regulation 29(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBI LODR Regulations"), 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 October 13, 2022, in accordance with the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 2018, as amended."
According to stock market experts, Infosys buyback move appears to be the efficient utilization of cash reserves to boost shareholder return. They said that the move would support Infosys share price in near term as macro uncertainties are haunting positional investors to a larger extent.
Infosys buyback today: Should you participate?
Expecting value buying in the stock ahead of Infosys buyback plan, Manoj Dalmia, Founder & Director at Proficient Equities said, "Due to buyback offer, some value buying is expected in Infosys shares. apart from this, due to macro uncertainties, more stocks coming into the hands of the company is going to support the Infosys share price in near term. Now from the Infosys shareholders' perspective, the offer is expected to an attractive premium. Hence, one must participate in this Infosys buyback offer as one would get an instant premium from one's investment. Apart from this, in buyback offer, it's company that pays income tax not the shareholders. So, it's a good chance for the shareholders of the beaten down IT stock to make money."
On Infosys buyback move, Yes Securities said, "“Infosys is expected to announce cash buyback of around ₹8,000 crore to ₹10,000 crore. As revenue growth outlook has moderated as clients have become cautious, this buyback is better use of surplus cash lying on books. It should limit downside to stock price in near term. The buyback price is expected to be at significant premium to CMP (current market price). In the current economic environment, it appears to be the efficient utilization of cash reserves to boost shareholder return."
Inn 2021, the board of directors of Infosys had approved up to ₹9,200 crore buyback plan, which commenced on June 25, 2021. Indian regulations require a minimum period of one year between two buybacks.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
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