Infosys to return up to $2 billion to shareholders; appoints co-chairman

By Sankalp Phartiyal and Arnab Paul

MUMBAI/BENGALURU (Reuters) - Infosys Ltd , India's second-biggest software services exporter, said on Thursday it would return up to $2 billion to shareholders, yielding to pressure for a share buyback from a group of founders and former executives.

It also announced the appointment of Ravi Venkatesan, an independent director, as co-chairman of the board - part of efforts to address the founders' corporate governance concerns.

Some founders and former executives of the Bengaluru-based company have publicly accused its board of governance lapses and urged it to follow the lead of rival Tata Consultancy Services that announced a $2.4 billion share buyback in February.

 

Infosys said it would return up to 130 billion rupees ($2.02 billion) to shareholders in the fiscal year ending March 2018, adding the manner of the payout will be decided by the board.

However, Infosys shares fell 2.4 percent in early trading on Thursday, as the market had been hoping for a larger payout.

The company also reported a small rise in consolidated net profit to 36.03 billion Indian rupees ($559.45 million) in the three months to March, while revenue grew 3.4 percent to 171.20 billion rupees.

Analysts, on average, had expected a consolidated profit of 35.67 billion rupees, according to Thomson Reuters data.

Infosys said it expects revenue for the year 2017-18 to grow 6.5 percent to 8.5 percent in constant currency terms.

($1 = 64.3975 Indian rupees)

(Reporting by Arnab Paul in Bengaluru; Editing by Muralikumar Anantharaman and Edwina Gibbs)