Stock To Watch: Infosys Share Buyback Today, Stock Falls Ahead Of Q2 Earnings Report

IT major Infosys is set to announce its Q2 earnings report today, ahead of it, its stock price is falling marginally. The share price of Infosys stood at Rs. 1,422.65 a piece, at the time of writing. Today, on October 13, Infosys is set to reveal the size of its share buyback. A company's share buyback means it will re-absorb the shares previously distributed among public and private investors at the market value per share.

Commenting on the matter, YES Securities stated, "As the revenue growth outlook has moderated as clients have become cautious, this buyback is a better use of surplus cash lying on books." The brokerage firm added, "Infosys is expected to announce cash buyback of around Rs. 8,000 crore - Rs. 10,000 crore. As the revenue growth outlook has moderated as clients have become cautious, this buyback is a better use of surplus cash lying on books. It should limit the downside to the stock price in the near term. The buyback price is expected to be at a significant premium to CMP. In the current economic environment, it appears to be the efficient utilization of cash reserves to boost shareholder return." In the past two share buybacks, the IT major had spent between Rs. 8,000- Rs. 9,000 crores. Many analysts are expecting that today's buyback size could be bigger.

Infosys - stock performance

Following the IT sector trend in the past one year due to volatile movements in the US bond yields and US Dollar index, Infosys stock price has also been watching a downturn. In the last 5 days, the share of Infosys fell by 1.41%. In the past 6 months it has fallen 18.64%. In the last 1 year its share price has fallen by 16.77% a piece. However, in the last 5 years its share price surged by 205.91%, making it a multibagger stock. It is a large-cap IT stock with a market capitalization of Rs. 599,341 crore. The stock is now offering a 2.18% dividend yield.

The 52-week high level of this stock is Rs. 1,953.90, and the 52-week low level of this stock is Rs. 1,355.

Market capitalization	Current market price	6 Months Downside	1 Year Downside
Rs. 599,341 crore	Rs. 1,422	18.64%	16.77%

In Q1 FY23, Infosys reported a good financial result, its consolidated net profit gained by 3.2% YoY to Rs. 5,360 crore, and revenue from operations stood at Rs. 34,470 crore, up by 23.6% YoY. Investors are today looking forward to its Q2 earnings.

Disclaimer

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