Infosys Buyback: IT Giant's Rs 18,000-Crore Share Repurchase Signals Long-Term Confidence, Say Analysts

Infosys share buyback announcement worth Rs 18,000 crore has garnered largely bullish nods from brokerages, including Nomura, Investec, and Morgan Stanley.

While the company is yet to disclose execution timelines, analysts expect the process to take a couple of months and see the move as aligned with Infosys’ long-term capital return strategy.

Morgan Stanley noted that, "in absolute terms, this is the largest-ever buyback announcement by Infosys and came in higher than our initial estimates."

However, the brokerage noted that, while timelines will be released in due course, based on historical experience, we think it could take 3-4 months to fully execute the same.

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The brokerage also noted that, "Given current timing (amid heightened macro uncertainty around tariffs, etc.), we see this as a vote of confidence on stability in F26 guidance in upcoming results."

Nomura, meanwhile, highlighted that Infosys buyback is in line with the stated capital returns policy, which states to return 85% of free cash flow to its shareholders in a block of five years for the FY25-29 period.

It further added that, "We estimate the buyback to be largely EPS-neutral in FY26F. Recall, Infosys had noted that it expects dividends to increase progressively every year."

The brokerage also said that Infosys remains one of its top picks in the large-cap India IT space, and they retain their 'Buy' call on the stock.

Investec highlighted that the company has not yet announced a record date for the buyback that wasannounced on Thursday, Sep. 11.

Investec also took note of the FCF and said that Infosys has a policy of paying out 85% of its FCF. "In this context, the buyback will lead to lower dividends in the current year. Consequently, the buyback is likely accretive by 2.4% on earnings in FY26E and should be taken positively by the street."