TCS, Infosys and Other Top IT Firms Return Record ₹1.3 Trillion to Shareholders in FY26 via Dividends and Buybacks Despite AI Disruptions

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. 

Record Payout Amidst AI Disruption 

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. 

Significant Share Buybacks Drive Payout Increase 

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. 

Read More: IT Employees’ Body NITES Seeks Government Advisory on Work from Home! 

Dividend and Buyback Trends 

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. 

Market Capitalisation and Payout Ratio 

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. 

Conclusion 

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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