Infosys shares experienced a significant rally, surging nearly 5% to reach an intraday high of ₹1,546.00. The stock's momentum was fueled by a notable decision from the company's promoters, including co-founder Narayana Murthy, to abstain from participating in the ₹18,000.00-crore share buyback program.

Market Reaction and Trading Activity

The market interpreted the promoters' decision as a strong vote of confidence in Infosys' future earnings potential. This sentiment triggered a substantial increase in trading activity, with volumes soaring to three times the 20-day average.

Buyback Details and Tax Implications

Infosys announced a share buyback at ₹1,800.00 per share, offering a premium of over ₹300.00 above the current market price of around ₹1,472.00. However, the company's promoters have decided not to participate due to unfavorable tax implications resulting from recent amendments to the Income Tax Act.

The Finance (No. 2) Act now treats the entire buyback amount as dividend income, subjecting it to a 35.88% tax rate for high-income residents. This results in a tax of about ₹646.00 per share, leaving only ₹1,154.00 post-tax. In contrast, selling shares in the open market under the capital gains regime results in a much lower tax rate of 14.95%, leaving shareholders with approximately ₹113.00 more per share after tax.

Financial Performance and Guidance

Infosys reported a constant currency revenue growth of 2.2% sequentially, demonstrating resilience in a challenging market environment. The company also raised the lower end of its guidance range to 2-3%, further bolstering investor confidence.

Recent Developments and Initiatives

Infosys has announced several significant developments:

1. Launch of 'Supportive Mind' mental health app in collaboration with Mental Health Foundation Australia.
2. A cloud ROI study revealing 66% of executives reporting positive returns.
3. Strategic collaborations with companies like Polestar and AIB.
4. Recognition as a top global brand.
5. Leadership changes, including Jayesh Sanghrajka's appointment as CFO.
6. Equity share allotments.

Regulatory Penalties

Infosys faced several regulatory penalties across multiple jurisdictions:

• Philippines: PHP 50,000.00
• India: INR 60,95,992.00
• UAE: AED 45,476.73
• Various penalties from several US states

The company has stated that these penalties have no material impact on its operations.

Infosys Foundation USA's Digital Workforce Innovation Program

Infosys Foundation USA has announced a $250,000.00 grant to the National Association for Community College Entrepreneurship (NACCE) for the Digital Workforce Innovation Program. Six higher education institutions have been selected as awardees:

1. Coppin State University (MD)
2. Foothill College (CA)
3. GateWay Community College (AZ)
4. Houston City College (TX)
5. Ivy Tech Community College (IN)
6. North Iowa Area Community College (IA)

These institutions will receive funding, technical assistance, coaching, and access to the Infosys Springboard digital learning platform over an 18-month period. The program aims to equip students with digital skills including AI, cloud computing, data analytics, and cybersecurity.

In conclusion, Infosys continues to demonstrate strong market performance and strategic growth initiatives, despite facing some regulatory challenges. The company's focus on digital innovation, strategic partnerships, and educational programs positions it well for future growth in the evolving technology landscape.

Infosys , India's second-largest IT services company, reported robust financial results for the second quarter of fiscal year 2026 and raised its full-year revenue growth guidance.

Key Highlights

• Q2 revenue grew 2.2% sequentially and 2.9% year-on-year in constant currency terms
• Operating margin expanded by 20 basis points sequentially to 21.00%
• Large deal total contract value (TCV) was $3.10 billion, with 67% being net new
• Announced an additional $1.60 billion mega deal after quarter end
• Added 8,000 employees during the quarter
• Raised FY26 revenue growth guidance to 2-3% in constant currency (from 1-3% earlier)
• Maintained operating margin guidance at 20-22% for FY26

Management Commentary

CEO Salil Parekh stated that client interactions are showing a strong focus on deploying AI across enterprises for both growth and cost efficiency. The company is seeing good traction in Financial Services and Manufacturing verticals, while Retail continues to face constraints.

Regarding visa rule changes, Infosys mentioned it has been working on localization in key markets like the US for years. The company plans to leverage more local hiring, nearshore centers, and offshore delivery to ensure continuity of client services.

CFO Jayesh Sanghrajka noted that deal pipelines remain strong, with a focus on cost optimization, vendor consolidation and AI-driven efficiencies. However, the overall demand environment remains uncertain.

AI Initiatives

Infosys highlighted its leadership in enterprise AI, with over 2,500 generative AI projects and 200+ agentic AI projects for clients. The company is also leveraging AI to improve its own operations.

Outlook

Looking ahead, Infosys expects some seasonal softness in the second half due to fewer working days and furloughs. However, the raised guidance reflects confidence from the strong H1 performance.

While macroeconomic uncertainties persist, Infosys remains well-positioned to capture opportunities in enterprise AI transformation and cost optimization initiatives for clients.