The Board of Directors of Infosys Ltd will consider a proposal for buyback of equity shares of the Company at its meeting to be held on August 19, 2017. The same was disclosed after a filing to stock exchanges late on Wednesday evening.
In the recent past, other big IT outsourcers have also announced share buybacks. However, no development on the same was noticed in the following months.
A share buyback is repurchase of its outstanding shares that reduces the number of shares in the open market. The final decision will, however, depend on the outcome of the board meeting, which is expected to turn out in the favour of a major buyback.
In a letter to various stock exchanges, India's second largest IT company, Infosys, said that it will restart trading on the markets on August 22, 2017. Infosys had liquid assets (cash and short term investments) of over Rs 39,000 crore as on June 30, 2017.
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As of 10.05 am, Infosys shares traded 3.86 per cent higher at Rs 1,012.90 compared to 0.28 per cent gains in the broader Nifty.
The company is yet to reveal the details of its buyback even as rival Tata Consultancy Services completed the Rs 16,000 crore buyback it announced in February. Companies usually resort to buyback to increase the value of their shares.
More recently, there have been reports quoted company's co-chairman Ravi Venkatesan as saying that Infosys' board will be open to considering giving Murthy a formal role if he wished to have one.