Shareholders quiz Infosys on AI hit as stock nears six-year low

At least half of Infosys Ltd’s 22 shareholders virtually present at its 45th annual general meeting (AGM) on Tuesday quizzed the management on the company’s declining share prices and the threats posed by automation tools.

Shares of India's second largest information technology service provider fell 3.4% on Tuesday, approaching a six-year low, despite the management sharing opportunities presented by the technology.

“Do you know why it (share price) is falling? Because we are not investing in future, and so foreign investors are dumping our shares,” said Om Prakash Kejriwal, a shareholder from Kolkata, during the Q&A session with the management.

The management declined to comment on the share prices, but said the company was poised to gain from AI-led opportunities.

“Opportunities are very large because of the many new things that are possible with AI (artificial intelligence)," said co-founder and chairman Nandan Nilekani. "So, we do see a lot of work coming down in the coming years.”

Still, shareholders punished the company, with its shares hitting multi-year lows on fears that AI might erode the relevance of IT services firms.

Concerns around the impact of advancement in AI tools have sent shares of IT services firms on a tailspin since the start of the year. Infosys shares have fallen more than 35% over the last 12 months.

Shareholders also quizzed the management on the impact of AI on jobs, growth and on the broader technology services industry.

In order to boost shareholder sentiment amid the AI-driven selloff, the company had announced a buyback worth ₹18,000 crore last year, which at least one shareholder expressed disappointment with.

“You people have destroyed ₹18,000 crore in buyback,” said the shareholder, adding that buybacks have not lifted investor sentiment.

The management did not take a shareholder's question regarding the re-appointment of Salil Parekh as chief executive.

Salil Parekh had taken over as chief executive on 2 January 2018 for a period of five years. He was re-appointed for another five years in May 2022, a year before his tenure was slated to end. His current tenure runs until March 2027.

The Bengaluru-based company ended financial year 2026 with $20.16 billion in revenue, up 4.6% from FY25. One-third of its incremental revenue came from manufacturing firms.

However, the management said demand remains soft. “The overall demand environment continues to be soft, and we see cautious behaviour by clients due to macro concerns, with growth also impacted due to AI inflation,” said Jayesh Sanghrajka, chief financial officer, at the AGM.

The management expects about 1.5-3.5% revenue growth in FY27, according to the company’s guidance issued in April, which came under the scanner of shareholders at the AGM.