Infosys Ltd., the IT services and consulting giant, is again in the news after announcing its fifth share buyback program. The board will meet to discuss the proposal on September 11, 2025, and the results will be released to the public following the meeting.
The Infosys share price showed mild volatility after the quarterly earnings release. Infosys' buybacks have typically triggered mixed short-term reactions but have mostly rewarded investors in the medium term.
Infosys has conducted four such buybacks since 2017, spending a total of nearly Rs 39,760 crore and repurchasing approximately 340 million shares. The first and largest was in 2017, when it utilized Rs 13,000 crore through the tender route, repurchasing 113 million shares at an average price of Rs 1,150 each.
The second buyback occurred in 2019, worth Rs 8,260 crore, in which Infosys purchased 110.5 million shares through the open market, at an average of Rs 747 per share. The next two buybacks occurred in 2021 and 2022, where the company spent Rs 9,200 crore and Rs 9,300 crore, respectively, to acquire a combined 116.2 million shares.
Investors' reactions to buybacks have been mixed immediately after the board approval. For example, after the buybacks in 2017 and 2021, the stock dropped as much as 5.8% within the first five sessions or one month. However, the medium-term recovery from this was impressive, gaining 9% in 2017, and as much as 22% in 2021 over the next six months.
Analysts often study the Infosys buyback history to understand its capital allocation strategy. In contrast, the 2019 and 2022 buybacks were positive both in the short and long term. Shares gained 7.7% over five days and 11.4% over a month following the 2019 approval.
Long-term investors continue to hold Infosys shares for consistent dividends and growth. Similarly, after the approval of the 2022 program, the stock rose 5.9% in five days and 10.6% in a month.
Before the decision is announced, Infosys' shares have already rallied more than 7%, from their September 8 low of Rs 1,428.3 to Rs 1,534.9 on September 10. The rally has led to a broader advance in IT stocks.
Infosys' share is 18.5% down year-to-date and nearly 28% down from its peak, indicating that the IT sector has yet to recover fully. Meanwhile, the Nifty IT index has declined 17% in 2025, marking the weakest performance among major sectors, while the Nifty 50 has risen 5.5%.
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At present, Infosys trades at a forward P/E multiple of 21.6x, which is lower than its five-year average of 24.8x. The Nifty IT index trades at around 25 times, while the Nifty 50 trades at 22.6 times.
Recent Infosys stock performance suggests resilience despite global concerns about IT spending. Another buyback could provide Infosys shares with near-term support while valuations remain below historical averages and sector performance continues to lag.