Infy Celebrates 25 Years of Listing; Shareholder Wealth Grows 42.3% CAGR

Even as the country’s second largest IT services exporter Infosys celebrates 25 years of its listing on Indian exchanges, its shareholders, who bought shares in 1993 and still holding have turned crorepatis.

Anyone who invested Rs 100 in Infosys shares way back in 1993 when it was listed on bourses are now owning Rs 6,80,000 as on date, according to an analysis by DH.

When stock splits and the bonus issues are taken into consideration, for every share that the stockholder has bought in 1993, he would end up having 512 shares right now, according to the analysis.

Its shares were listed in stock exchanges in June 1993 with trading opening at ₹145 per share.

As per the calculations by various analysts, for every 100 shares in the company back in 1993, it would be worth over Rs 6.44 crore as on June 12, translating to an annual growth of 42.3%.

Undersubscribed IPO

Incidentally, the public offer of Infosys was undersubscribed at the time of initial public offering (IPO) and had to be bailed out by US investment bank Morgan Stanley which picked up 13% of equity at the offer price. The stock was split in 2000 to maintain liquidity. The company has offered 1:1 bonus shares in 10 out of 11 years when it declared a bonus issue. In 2005, it announced a 3:1 bonus issue.

From being a Rs 10,000 company, that NR Narayana Murthy started, Infosys has gone on to redefine India’s corporate culture.

The company has shown strong growth since its listing. From $5.1 million revenues in 1993, the company has seen its revenues compound annually by 36% to $10.94 billion by 2018. The net income on other hand has been compounded by equal numbers, from $1.23 million in 1993 to $2.49 billion by 2018.

In Rupee terms, revenues over last 25 years have grown at a CAGR of 40.5%, while net profits have grown by 40.1%, according to the internal calculations of the IT major.

Prior to its listing the company’s revenues grew from Rs 12 lakh in 1981 to Rs 8.66 crore in fiscal ended March 31, 1992, the year of economic reforms in India.

But then this growth hasn’t been as smooth as it may seem. For most of its years of existence, save the previous four, the company was managed by its promoter founders.