After years of sitting on piles of cash, Indian information technology (IT) services firms are suddenly dispensing some of it to their shareholders by way of buybacks.
The buybacks are a move to boost share price and soothe investor sentiments. They are also designed to make them less attractive to predators. After years of giving high returns, the industry has been delivering below expectations; most Indian IT services firms have been performing below the Sensex, the benchmark stock index.
Projections mirror the growing uncertainly. The U.S.–based Deep Dive/Everest Group IT services forecaster expects a 6.3% growth for the top five IT companies for calendar year 2017. For the industry as a whole (excluding multinational captive centers), the growth in 2017 is projected to be a mere 5.3%.