In FY26, India's leading 16 IT firms returned a record ₹1.3 trillion to shareholders through dividends and share buybacks, even as AI disruptions impacted profit growth and valuations.
The top 16 IT services companies in India distributed an unprecedented ₹1.3 trillion to shareholders in FY26. This marked a 36.3% increase from the ₹95,400 crore paid in FY25.
Despite AI models challenging traditional business structures, the industry saw its fastest payout growth in 9 years.
The combined net profit of these companies rose by 3.5% year-on-year, the slowest in 8 years, while net sales increased by 7.6%, an improvement from 5.1% in FY25.
The surge in payout was largely driven by significant share buybacks from major firms like Infosys and Wipro. Infosys completed a ₹18,000 crore buyback in November, and Wipro announced a ₹15,000 crore buyback to be completed later this year.
Smaller companies like Cyient also announced substantial buybacks.
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Equity dividends saw a modest increase of 0.7% to ₹96,102 crore in FY26.
Tata Consultancy Services (TCS), traditionally the largest payer, reduced its dividend payout by 12.7% to ₹38,820 crore, focusing on investments in data centres and AI businesses. TCS did not engage in share buybacks in the last 2 years.
The payout ratio for these companies reached a record 102.2% of reported net profit in FY26, up from 77.7% in FY25.
The combined market capitalisation of the 16 companies fell by 25.3% in FY26, the worst annual performance in over a decade, declining to ₹24 trillion by March 2026.
Despite AI-induced challenges, India's IT firms achieved a record payout to shareholders in FY26. The increase was primarily driven by significant share buybacks, even as market capitalisation and profit growth faced pressure.
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Published on: May 13, 2026, 11:32 AM IST
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