Rs 10,000 invested in 1993 Infosys IPO is now worth Rs 4 crore
Infosys hasn’t turned back since that time. It started with $250 in capital and has now expanded to a $10.9 billion (FY 18 revenue) firm with a market capitalization of roughly $40 billion. As of March 31, the IT bellwether and its affiliates employed 204,107 people.
“Buy it assuming you’ll hold it forever,”
This concept does seem fanciful, at least to return-hungry shareholders, but who would have imagined that a Bengaluru-based corporation, which made its stock market debut more than 20 years ago, would rise to the position of one of the top 10 blue chip stocks with a market valuation of Rs. 2.7 lakh crore on the BSE.
With an initial investment of $250, NR Narayana Murthy and six engineers founded Infosys in Pune. It made an IPO in February 1993, and on June 14, 1993, its shares were placed on Indian stock exchanges.
Compared to its issue price of Rs 95 per share, trading began with a significant premium of Rs 145 per share. It issued 20,70,000 American depositary shares at a price of $34 per ADS in March 1999, which is equal to 10,35,000 equity shares with a par value of Rs. 10 each. On the NASDAQ National Market, the same was also listed.
How Much Did Your Investment Grow in the Last 20 Years?
According to rough calculations, if someone had spent 10,000 or purchased almost 100 shares in Infosys in 1993, their investment would have been worth more than Rs 2 crore as of June 12 2022.
- Since its IPO, the management has been generous in awarding bonuses. In 10 out of 11 years when it announced a bonus issue, it has provided 1:1 bonus shares. It announced a 3:1 bonus issue in 2005.
- In 1999, it had reduced the face value of its shares from Rs. 10 to Rs (2:1). Since January 24, 2000, the share has been quoted on an ex-split basis.
- “If we account for the bonus and stock splits, the investment’s value increased to Rs 2.1 crore, representing a compound annual growth rate of 36.20 percent. After accounting for bonuses, the number of shares would have increased from 100 to 17,064, according to Ritesh Ashar, chief strategy officer of KIFS Trade Capital.
Explaining the Rationale,
- The business announced a 1:1 bonus in 1994, giving investors 200 shares.
- The business issued a 1:1 bonus in 1997, giving investors 400 shares.
- The business issued a 1:1 bonus in 1999, giving investors 800 shares.
- In 1999, the corporation divided shares with a face value of Rs. 10 to Rs. 5, giving investors 1,600 shares.
- The business announced a 3:1 incentive in 2004. The investor received 6,400 shares.
- The business issued a 1:1 bonus in 2006, giving investors 12,800 shares.
- The business issued a 1:1 bonus in 2014, giving investors 25,600 shares.
- The business announced a 1:1 bonus in 2015, giving investors 51,200 shares.
Total value = Total shares 51,200 x 1,258 (as of June 12 close) = Rs 6,44,09,600 (about Rs 6.44 crore), demonstrating a CAGR of 44.42 percent.
Investment consultant Narayan Bhat, who is located in Bengaluru, originally acquired the stock in 1996 and has kept it ever since. His taste, though, appears to be shifting toward other IT businesses.
Because of its strong management, strict quality standards, and outstanding quarterly and yearly performance, Infosys was formerly the finest long-term investment for investors. It was supreme in the software industry. That is no longer accurate, he declared.
In terms of market capitalization and investor confidence, Tata Consultancy Services has surpassed Infosys to take the top spot, according to Bhat.
“Investor attitudes were severely shaken by the Vishal Sikka incident. It is not a long-term wager unless the corporation establishes a second line of succession.”
Rs. 95 in Infosys Made Investors Crorepati in 2022
Infosys has recently gained pace after being under pressure for a protracted period due to tightened corporate governance, foreign policy, and economic reasons.
The majority of experts recommend long-term ownership of Infosys to investors. The stock has gained slightly more than 20% so far in 2018 and about 32% over the past 12 months.
Infosys released a good set of Q4 FY18 financial results, and the management gave a revenue growth outlook for FY19 of 6 to 8 percent, in line with market growth.
“Infosys has the ability to gradually extract wealth from digitization. To take advantage of the opportunity that the changing industry offers and to keep enjoying the higher payout ratio, it is recommended to stay onto this bellwether, says Dinesh Rohira, founder and CEO of 5nance.com.
Information technology analyst Sanjeev Hota of Sharekhan has given Infosys a buy rating and a target price of Rs 1,420 per share, representing a gain of 11% over the stock’s closing price of Rs 1,276 on Wednesday.
Infosys is prepared to develop sustainable growth engines by making large investments in digital service capabilities, which provide a tonne of space for expansion. Along with recent significant transaction wins, we envision growth growing as demand from the banking and financial services, insurance, and healthcare sectors improves, the executive added.
Hota anticipates that its long-standing large valuation gap with TCS will progressively close as earnings accelerate and shareholders receive better returns through buybacks and dividends.
About the Company
- The second-largest software services provider in the nation, Infosys, has contributed significantly to the international recognition of India’s information technology competence.
- It was established in 1981 by seven first-generation business owners and debuted on the stock market in June 1993, which was 25 years ago.
- The retail investors did not warm to Infosys’ initial public offering (IPO) and gave it a frigid reception.
- Until investment firm Morgan Stanley bailed it out by purchasing a 13 percent interest in the company, the IPO remained undersubscribed.
- However, the IPO ended up being a huge success, and those who passed it up should now regret it.
- An investment of Rs 10,000 in Infosys’ IPO, which priced each share at Rs 95, is now worth nearly Rs 4 crore.
- A comparable gold investment made on the same day would only be worth about Rs. 1 lakh now.
- The company’s share price increased over time as a result of strong sales and profit growth.
- In contrast, Infosys has a history of giving regular dividends and offering bonus shares to its shareholders in order to share the company’s gains.
- Six bonus shares have already been distributed to shareholders, and for the last 25 years, the firm has never missed a dividend payment.
IEPF Claim- Recovery of Infosys Shares
The Company is obligated to transfer all shares of the Company for which dividends have remained unpaid or encashed for seven or more years in a row to the Investor Education and Protection Fund (or “IEPF”) set up by the Government of India.
The corporation notifies each shareholder on a regular basis how to claim and cash a dividend.
Information on Equity Transferred shares to the IEPF
To examine the number of shares transferred to the IEPF authority, shareholders can provide the following information:
Shares owned physically – Folio No (Eg: ITL000000)
Holdings of shares in dematerialized form:
NSDL – 6 character/digit DP ID and 8 character client ID (Eg: IN30000010000000)
16-digit client ID for CDSL (Eg: 1200000000002000)
When a final dividend announced for the 2014–15 fiscal year remains unclaimed or encashed for a seventh year in a row, the firm will move the underlying shares.
Are you dealing with these issues?
- misplaced or lost share certificates
- not given a bonus, privileges, or dividends
- Dematerializing real stock
- Shareholder has died or is no longer alive.
- Transferred shares and dividends to the IEPF
We Offer Help With
- How to Request the Issuance of a Duplicate Share Certificate
- Recover IEPF dividends and shares.
- How to record an address change
- Changes to the firm name, shareholders, or corporate merger
- Filing of a nomination
- Name transposition, or switching the registered holders’ names in alphabetical order
- Deletion of shareholders’ names who have passed away, transfer of shares
- Transfer of Shares Process
- Dividend not received
- Split shares, bonuses, and unclaimed dividends
Forgotten Dividends and Stock Recovery Service
For customers worldwide, most notably in the UAE, UK, USA, Canada, Australia, Germany, etc. We have recovered shares of ITC, Matrix lab, JSW, Infosys, Tata Steel, Asian Paints, and several other firms.
- copies of dividend warrants,
- if any, copies of (old) certificates,
- if any, copies of communication with the firm or registrar,
- if any, copies of bank statements with dividend receipts,
- if any, and, if applicable,
- Contact details
How we do it correctly – Before accepting work, we carefully review any outdated and insufficient evidence and papers you send us. After that, we will determine the time, cost, and subsequent actions. After taking a position, we communicate on the client’s behalf with the firm, registrar, banks, attorney, court, notary, and other parties directly. Streamlining things for you.
What steps are involved in recovering shares from the IEPF?
The steps in the recovery of IEPF shares listed below.
Step 1: Claimant’s filing with the authority.
Step 2: Providing the Company with the Claim.
Step 3: The Company must submit its claim to the IEPF Authority.
Step 4: The claimant receives a refund from the IEPF Authority.
Connect with the experts for MUDS Management for Recovery of Shares right away for the simplest step.
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