Do you own this blue-chip IT stock? Get ready for a bonanza
If you are an Infosys shareholder, you may soon have a reason to rejoice.
The software services company on Monday said that its board of directors would consider a buyback of shares on Thursday, when it announces the earnings for the quarter ended September 30.
While there is no clarity on the price at which Infosys will buy the shares back, the price would most likely be above the prevailing market price.
But why is Infosys buying shares back?
As of June end, the company's cash and equivalents were at Rs 13,982 crore and it does not have too many avenues to deploy this money. Hence, it is rewarding its shareholders with a buyback.
When was the last time Infosys bought shares back?
The software major conducted a share buyback of shares in September 2021 and bought back shares worth Rs 9,200 crore through the open market.
But how has the counter performed so far this year?
On a year-to-date basis, shares of Infosys have lagged behind Nifty50. The stock has fallen over 15 per cent, whereas the Nifty50 has lost just 3 per cent. Also, the shares are down almost 25% from the one-year high touched in mid-January.
Does the market still need some important details about the buyback apart from the price itself?
Yes. Dalal Street would be keen to know if the mode of buyback will be open market or the tender offer route.
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