Infosys shares gain as Rs 13,000 crore share buyback kicks off
NEW DELHI: Shares of Infosys edged higher in an otherwise weak trading session on Thursday after the IT major kicked off its Rs 13,000 crore share buyback offer.
The company is looking to buy back over 11.30 crore shares from eligible investors at Rs 1,150 apiece. This has been the first share buyback in the IT company’s 36-year long history.
The buyback will close on December 14, while the last date of settlement of bids on the BSE is December 26. The buyback size represents 20.51 per cent of the company’s total paid-up equity share capital and free reserves as per the audited standalone balance sheet.
The stock rose 0.66 per cent to hit a high of Rs 989.80 on BSE.
On April 13, the Infosys board reviewed and approved a revised capital allocation policy of the company after taking into consideration the strategic and operational cash requirements of the company in the medium term.
The buyback had been a long-standing demand by some of the founders and high-profile former executives, who have been pushing Infosys to return surplus capital to shareholders, PTI reported.
Share buybacks typically improve earnings per share and return surplus cash to shareholders, while supporting share price during period of sluggish market condition.
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Via:: Economic Times – Stocks