Fortune India Explainer: Why Infosys is buying back shares for the fifth time?

With ₹18,000 crore set to be returned to shareholders, the latest share buyback programme is the largest of the five announced to date.

How much is the Infosys buyback of 2025?

On September 11, 2025, India’s second biggest IT services and consulting company Infosys, announced a share buyback scheme of ₹18,000 crore. The company will be offering its shareholders a price of ₹1800 per share and is looking to mop up to 10 crore shares or approximately 2.41% of the shares of the company.

The buyback will take place through a tender process and the announcement of details of the process and the timelines will be intimated in due course as per the company statement. The date for the opening and closing of the share tendering period is yet to be announced.

“The public announcement and other documents setting out the process, timelines and other statutory details of the Buyback will be released in due course in accordance with the Buyback Regulations”, the company filing stated.

How many buybacks has Infosys done in the past 10 years?

The latest buyback is the fifth in the history of the company. In the past, the company had announced its first ever buyback in 2017 where it has spent nearly ₹13,000 crore to buyback nearly 4.92% of the company’s shares. Later in 2019, Infosys again spent ₹8,260 crore, offering ₹800 per share to buyback 2.36% of the total shares. Two years later, the company announced back-to-back buybacks, one in April 2021 and the other in October 2022. The 2021 buyback was to the extent of ₹9,200 crore where the company was willing to pay Rs1,750 per share and in 2022, the buyback was to a tune of ₹9,300 crore with the company offering ₹1,850 per share.

What is the company’s capital allocation policy? 

In FY18, the company revised its capital allocation policy to increase the payout to shareholders to 70% of the free cash flow of the corresponding fiscal year. Prior to that, the company’s policy was to pay dividends of up to 50% of the post-tax profits of the fiscal year. However, in FY20, the company adopted a revised policy that was applicable for a five- year period (2020-24) and further increased the shareholder payout threshold. The revised policy stated that it would return approximately 85% of the free cash flows generated over a 5-year period either through a combination of semi-annual dividends and / or share buybacks or special dividends, Currently the company continues its policy of returning approximately 85% of the free cash flow generated cumulatively over a 5-year period.

Buyback v/s dividend

The amendments in the Finance Act of 2024, brought about significant changes in the way buybacks would be treated from a taxation perspective. While earlier companies that were doing a buy back were taxed at 23 % on the distributed income from the buy back and the shareholders received it tax-free. Post October 2024 the buyback income is considered as dividends where shareholders pay an income tax as per their applicable slab.