Infosys shares will be supported by the buyback but demand scenario remains unchanged, analysts say
Published on 12/09/2025 07:49 AM
Infosys shares will be supported by the buyback but demand scenario remains unchanged, analysts sayBrokerages remain largely positive on Infosys after the IT major announced its biggest-ever share buyback of ₹18,000 crore. While CLSA and Nomura see further upside and support for the stock, Morgan Stanley has taken a more cautious stance, citing execution timelines and macro uncertainty.By Meghna Sen September 12, 2025, 7:49:27 AM IST (Published)2 Min ReadShares of Bengaluru-based IT services giant Infosys Ltd. will continue to remain in focus on Friday, September 12, after the board approved a share buyback worth ₹18,000 crore.
The buyback will be conducted through the tender route at a price of ₹1,800 per share, which is a 19% premium to the current market price. The company will repurchase around 2.41% of its outstanding equity shares.
This marks Infosys' fifth buyback and its largest to date, exceeding market expectations of a ₹10,000-14,000 crore buyback.
Year
Buyback Size (₹crore)
2017
13,000
2019
8,260
2021
9,200
2022
9,300
What brokerages say on Infosys buyback
Hong Kong-based brokerage firm CLSA has an 'Outperform' rating on Infosys, with a price target of ₹1,861. This target implies a further upside of 23% from Thursday's closing price.
The brokerage believes that the buyback should lend support to the stock during a seasonally weak second half of FY26.
It added that Infosys is not seeing any major change in demand outlook, with management continuing to emphasise cost optimisation amid subdued discretionary spending.
On Generative AI, the company expects IT budgets to expand, with incremental volumes offsetting deflationary pressure.
Nomura has a 'Buy' recommendation with a target price of ₹1,880.
The brokerage pointed out Infosys' largest-ever buyback and expects the company to post 3.8% year-on-year dollar revenue growth in FY26F (including 40 basis points from acquisitions, excluding the recently announced Versent deal).
It values Infosys at 20x FY27F EPS and sees an attractive dividend yield of 4.4% on FY27F estimates.
Morgan Stanley, meanwhile, has an ‘Equalweight’ rating with a price target of ₹1,700. It pointed out that the buyback size came in higher than expectations and, in absolute terms, is Infosys’ biggest ever.
While timelines will be released in due course, Morgan Stanley, based on historical experience, thinks it could take three to four months to fully execute.
It also views the announcement, coming amid macro uncertainty around tariffs and global demand, as a signal of confidence in the company’s FY26 guidance.
Of the 50 analysts that have coverage on Infosys, 35 of them have a 'Buy' rating, 13 have a 'Hold' rating, while two have a 'Sell' recommendation on the stock.
Shares of Infosys ended 1.33% lower on Thursday, at ₹1,512.20. The stock has declined 20% so far this year.Continue ReadingNote To ReadersDisclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!TagsInfosysInfosys share priceInfosys SharesShare Buybackshare market today