Infosys's Rs 9,200 crore share buyback programme is set to begin on June 25, with the IT giant
proposing to buy back shares at a maximum price of Rs 1,750 per share. The buyback was approved
by the board on April 14, 2021, and shareholders gave their support on June 19, 2021, during the
company's 40th annual general meeting, according to a regulatory filing.
Infosys published a public statement in several newspapers on June 23 for the repurchase of its
equity shares from the open market via the stock exchange method, according to a regulatory filing
on Wednesday. The buyback's manager has been named as Kotak Mahindra Capital Company Ltd.
Conferring to the intended timeline, the buyback will begin on June 25, 2021, and end on December
24, 2021 (6 months from the start of the buyback) or when the corporation completes the buyback
by deploying the amount corresponding to the maximum buyback size.
"Subject to the market price of the equity shares being equal to the maximum buyback price", the
advertisement stated, "the indicative maximum number of equity shares bought back would be
5,25,71,428 equity shares, representing approximately 1.23 per cent of the company's paid-up
equity share capital as of March 31, 2021."
The actual number of stock shares purchased back may exceed the maximum buyback shares if the
equity shares are bought back at a lower price than the maximum buyback price, but the maximum
buyback size will always apply.
In addition, Infosys will use at least half of the cash set aside as the maximum repurchase size, which
is Rs 4,600 crore, for the buyback. The corporation will acquire an estimated minimum of
2,62,85,714 equity shares based on the minimum buyback size and maximum repurchase price.
The fund for the buyback will come from the company's free reserves or any other source allowed by
the Buyback Regulations or the Companies Act. "The buyback is being undertaken by way of open
market purchases through the Indian stock exchanges and is not extended to the promoters,
promoter group, and people in control of the firm," according to Regulation 16(ii) of the Buyback
Regulations.
Infosys has increased its capital allocation strategy for Fiscal Year 20, stating that it will return 85 per
cent of free cash flow over a five-year period through stock buybacks and dividends. The Infosys
Board of Directors proposed a capital return of Rs 15,600 crore in April, which included a final
dividend of Rs 6,400 crore and a Rs 9,200 crore open market repurchase of shares.