What is a Share Buyback?
A buyback is when a company buys back its own shares from existing shareholders, usually at a fixed price which is higher than the market price. Why companies do buybacks:

• To reward shareholders with extra returns.
• To reduce the total number of shares in the market (which can increase the share value over time).
• To show the company is financially strong and has excess cash.
• To improve financial ratios like Earnings Per Share (EPS).

Example – Infosys Buyback (2022):
Infosys announced a buyback of shares worth ₹9,300 crores at a fixed price of ₹1,850 per share. At that time, Infosys was trading lower in the stock market, so shareholders could sell their shares to Infosys directly at a higher price and make a profit.

How Does Buyback Happen in India?

There are two main methods:

1. Tender Offer Method → Company announces a fixed buyback price. Eligible shareholders can tender (offer) their shares during the buyback window. Shares are then accepted in a certain ratio depending on how many apply.
2. Open Market Method → Company buys shares directly from the stock exchange, at market prices (within a fixed price cap).

Infosys usually does Tender Offer method, which is better for retail investors because you get a clear fixed price.

How to Apply for Infosys Buyback in Zerodha

1. Check Eligibility

• The company announces a record date.
• If you hold Infosys shares in your demat account on that date, you are eligible to participate.

2. Apply in Zerodha Console (Considering Zerodha is your trading platform)

1. Log in to Zerodha Console.
2. Go to Portfolio → Corporate Action Order Window.
3. If eligible, you will see an option called Infosys Buyback.
4. Click and enter the number of shares you want to tender. You can offer all or part of your eligible shares.
5. Confirm the order.

Tip: You can tender more shares than the company will finally accept. The extra shares will simply come back to your demat account.

3. Acceptance Ratio

• The company cannot buy all the shares offered by all investors.
• The number of shares accepted depends on total demand vs. buyback size. This is called the acceptance ratio.
• Example: If you tender 100 shares, but acceptance ratio is 50%, then only 50 shares will be taken by Infosys.

4. Settlement

• The accepted shares are removed from your demat account.
• You receive cash in your linked bank account (not in your trading account).
• Any unaccepted shares are returned safely to your demat.

Key Points for Investors

• No brokerage/charges for applying in Zerodha.
• Always check the tender window dates announced by Infosys. You can apply only during those dates.
• If market price goes above buyback price, sometimes it may not make sense to tender – so compare both before applying.
• Buybacks are usually good opportunities for retail investors, as companies like Infosys, TCS, Wipro, etc., tend to give retail shareholders some advantage in allocation.