Infosys Limited (NSE: INFY, BSE: 500209, NYSE: INFY) is ending the week in an unusual spotlight: its U.S.-traded ADRs briefly rocketed to near $30 before volatility halts, while the India-listed shares moved far more calmly—an eye-catching divergence that has sparked a wave of explanations, from data-feed glitches to short-squeeze mechanics. [1]
As of the latest available U.S. session data (markets are closed Sunday), Infosys’ ADR last traded around $20.22, after an exceptionally wide intraday range (roughly $18.45 to $29.97) and outsized volume of ~118.7 million shares—numbers that are wildly abnormal for what is typically a lower-volatility large-cap IT services name. [2]
But beneath the headline volatility, the “real” Infosys story for long-term shareholders remains more familiar: steady demand in select verticals, a management outlook of 2%–3% constant-currency revenue growth for FY26, operating margin guidance of 20%–22%, a recently completed ₹18,000 crore buyback, and a major upcoming catalyst—Q3 FY26 results scheduled for January 14, 2026. [3]
The week’s defining event: Infosys ADRs surge, NYSE halts trading, and confusion follows
On Friday, December 19, 2025, Infosys’ ADRs (INFY) experienced a sudden, extreme spike shortly after the New York open, triggering two Limit Up–Limit Down (LULD) volatility pauses on the NYSE. Infosys later confirmed those pauses in a stock-exchange clarification. [4]
Critically, the move was not mirrored in India to the same magnitude. Indian shares finished that session around ₹1,639 (depending on venue/reporting), reinforcing the market’s core puzzle: why would the U.S.-line explode while the home-market line stayed comparatively grounded? [5]
That “disconnect” matters because ADRs are ultimately a wrapper on the underlying equity (with FX and conversion mechanics layered in). When ADR prices detach sharply from local shares—especially intraday—markets usually look for one of three culprits: information, liquidity/technical constraints, or data/system errors. This episode has credible candidates in all three buckets, but Infosys itself has pointed investors away from any undisclosed news catalyst. [6]
Infosys’ official response: “No material events” behind the ADR volatility
On December 20, 2025, Infosys issued a formal clarification to stock exchanges stating it observed volatility in its ADR price on December 19 (with two LULD pauses) and that “there are no material events that require disclosure” under India’s SEBI listing regulations. The company said the statement was issued “in the interest of transparency” to avoid unwarranted speculation. [7]
In practical terms, that filing does two things for investors:
- It signals that the company is not aware of any undisclosed corporate development (deal, guidance change, earnings leak, etc.) that would rationally justify a 40%–50% intraday re-pricing.
- It pushes the discussion toward market-structure explanations—how ADRs trade, how borrows get tight, how algos react to bad data, and how liquidity thins out around year-end. [8]
So what did cause the spike? Competing explanations investors are weighing
No single explanation has been universally confirmed. What’s clear is that multiple credible market narratives emerged in real time, and they can even coexist (one trigger, several amplifiers).
1) Data-feed / ticker-mapping glitch + algorithmic buying in thin liquidity
A prominent thread—picked up across Indian market media—points to a ticker-mapping error across financial data platforms that may have confused automated trading systems and kicked off a self-reinforcing burst of algorithmic buying. This theory was attributed to reporting from Canada-based The Chronicle Journal and echoed by outlets in India, with caveats that the details weren’t independently verified by every publisher. [9]
The logic here is very “2025 market plumbing”:
- If a security is mislabeled or mismapped in a data feed,
- and trading models are scanning for anomalies, mispricings, or sudden divergences,
- an automated rush of buy orders can hit a thinly traded line (like some ADRs),
- then volatility controls halt trading—often after the move is already violent. [10]
2) Short squeeze dynamics and “hard-to-borrow” pressure
A second major narrative frames the move as a short squeeze—or at least squeeze-like behavior—where short sellers face forced buy-ins, rising borrow rates, and limited availability of shares to borrow. One report summarizing a Wells Fargo note described Infosys as becoming “hard to borrow,” with borrow availability collapsing and borrowing rates potentially rising sharply. [11]
Market coverage from Dow Jones/MarketWatch also described a scenario in which trading frictions—potentially including the mechanics of converting ordinary shares to ADRs—created a scramble for deliverable shares, amplifying upside pressure during a high-volume session. [12]
Even if you’re not a market microstructure nerd, the takeaway is simple: when borrow gets tight, price can behave badly—especially on instruments that can be less liquid than their underlying home-market shares.
3) Options expiry + year-end liquidity: the classic accelerants
Several reports noted that the episode occurred against a backdrop that can intensify weird price action: thin year-end liquidity and a major options expiration period. That doesn’t create a 50% move by itself, but it can turn a spark (data error, forced buy-in, or algo cascade) into a brief bonfire. [13]
The stock fundamentals: what Infosys last reported (and what management is guiding)
While the market debates the ADR spike, Infosys’ most recent official operating picture comes from its Q2 FY26 results (quarter ended September 30, 2025, reported October 16, 2025).
Key highlights from the company’s press release include:
- Revenue:$5,076 million in Q2, with 2.9% YoY and 2.2% QoQ growth in constant currency
- Operating margin:21.0%
- Free cash flow:$1.1 billion (reported as 131.1% of net profit)
- Large deal wins:$3.1 billion TCV, with 67% net new
- FY26 guidance:2%–3% revenue growth in constant currency and 20%–22% operating margin [14]
Management commentary also emphasized scaling AI-led transformation work (via “Infosys Topaz”) and reskilling efforts, which matters because the near-term IT services debate is less about “AI hype” and more about whether AI expands budgets (new work) or compresses pricing (productivity passed back to clients). [15]
Capital return update: Infosys’ ₹18,000 crore buyback is completed and shares have been extinguished
Infosys’ 2025 buyback has moved from “announcement” to “done.”
The official letter of offer described a tender offer to buy back up to 10 crore (100,000,000) equity shares at ₹1,800 per share, for an aggregate amount not exceeding ₹18,000 crore. [16]
The company’s subsequent extinguishment filing shows:
- The buyback tendering period ran Nov 20–Nov 26, 2025 (inclusive). [17]
- 100,000,000 shares were extinguished. [18]
- Equity share capital (number of shares) shifted from 4,154,401,349 (as of record date) to 4,054,624,409 after extinguishment (noting inclusion of shares issued for RSU exercises). [19]
Why this matters for the stock: a completed buyback reduces share count, which can mechanically support per-share metrics over time—but only if operating performance holds up. Buybacks are not magic; they’re capital allocation. In Infosys’ case, the company has also explicitly linked the buyback to its stated capital allocation approach. [20]
For investors scanning for “what’s next” on capital returns, the bigger focus now shifts to (a) future buyback cadence, and (b) dividend decisions in the context of FY26 growth and margin delivery.
New company update: Infosys McCamish settlement approved in U.S. court
Another notable corporate update in the current news cycle is a company statement dated December 20, 2025, concerning U.S. class action lawsuits tied to Infosys McCamish Systems LLC.
Infosys stated that:
- McCamish agreed to pay $17.5 million into a settlement fund,
- the court granted final approval on December 18, 2025,
- and the settlement becomes effective if not appealed within 30 days, resolving the allegations without admission of liability. [21]
This is not presented as an earnings-moving event on its own (relative to Infosys’ scale), but it is the kind of legal clean-up investors track because it reduces uncertainty tails—especially when headline-driven markets are already jittery.
Sector backdrop: Citi stays cautious on IT recovery, but prefers Infosys among large caps
Zooming out, the Indian IT services sector narrative remains a tug-of-war between:
- “Spending is stable, and large deal pipelines exist,” and
- “A broad discretionary recovery is still slow, with uncertainty lingering.”
A Citi note reported by The Economic Times captured this tone: stable demand, but no clear evidence yet of a macro-led rebound (including via U.S. rate cuts), with Citi preferring Infosys and HCLTech among large-cap peers even while remaining guarded on the sector overall. [22]
For Infosys stock specifically, that means the market is rewarding evidence of:
- durable BFSI demand,
- ramp-up execution on large deals,
- margin protection amid wage/attrition cycles, and
- credible monetization of AI offerings—without triggering client pushback on pricing.
Policy risk to watch: the $100,000 H‑1B visa fee is still in the headlines
Investors also have one eye on U.S. policy developments that can influence delivery models and onsite staffing economics for IT services firms.
A Reuters report on December 19, 2025 said a federal judge expressed skepticism toward a challenge brought by major U.S. business groups against President Donald Trump’s $100,000 fee on new H‑1B visas, suggesting the measure may fall under broad presidential immigration powers. Reuters also noted the fee was announced in September, dramatically above the prior fee range (roughly $2,000–$5,000 depending on factors), and that it is set to expire in September 2026 (though it can be extended). [23]
For Infosys—and peers like TCS, Wipro, and Cognizant—the investment question is not “does the company use H‑1B?” (it does) but “how much incremental cost or friction does policy add, and can delivery models absorb it without margin erosion?”
Forecasts and price targets: consensus points to modest upside, but estimates vary by platform
Forecasts for Infosys stock currently cluster around “moderate upside, not a moonshot,” but the exact picture depends on whose analyst universe you’re looking at.
Analyst target range (NSE-listed Infosys)
Investing.com’s consensus snapshot (showing 44 analysts) lists:
- Average target:₹1,729.52
- High:₹2,150
- Low:₹1,470
- With the stock around ₹1,638.70 in that snapshot, it implies roughly +5.54% upside to the average target. [24]
Trendlyne, using a different cut of broker reports (11 analysts / 30 reports in the displayed summary), shows a much flatter consensus:
- Average target:₹1,639.18, implying near-zero upside from a last price of ₹1,638.70. [25]
This spread is not unusual: platforms can differ on which brokers are included, how stale reports are treated, and whether targets are “long-term,” “12-month,” or tied to specific catalysts.
Management’s own “forecast”: FY26 guidance remains the anchor
For many investors, the most actionable “forecast” remains management’s FY26 guidance—2%–3% constant-currency revenue growth and 20%–22% operating margin—because it directly frames what the next few quarters must deliver to justify re-rating. [26]
Next catalyst: Infosys Q3 FY26 results on January 14, 2026 (board meeting Jan 13–14)
Infosys has already told markets what the next big scheduled moment is.
In an exchange filing dated December 15, 2025, Infosys said its Board will meet on January 13 and 14, 2026 to approve results for the quarter and nine months ended December 31, 2025, and that the company will hold an investor/analyst call on January 14, 2026. The filing also states the trading window is closed from December 16, 2025 and reopens January 19, 2026. [27]
In other words: after a week where the tape screamed “mystery,” the calendar is now pointing investors back to the boring-but-important stuff—earnings, guidance, and execution.
What to watch next for Infosys stock: separating signal from noise
Going into year-end and early 2026, investors tracking Infosys (INFY) are likely to focus on five practical questions:
- Will ADR pricing normalize vs. India shares?
The December spike looks technical by the company’s own disclosure posture, but volatility can have aftershocks in positioning and options. [28] - Is “hard-to-borrow” pressure real and persistent?
If borrow remains tight, it can continue to distort short-term trading behavior, independent of fundamentals. [29] - Do large deal wins translate into revenue acceleration without margin leakage?
Infosys’ Q2 large-deal TCV and cash conversion were strong; the market wants to see that convert cleanly. [30] - How does U.S. immigration policy evolve—and how quickly can delivery models adapt?
The legal trajectory of the H‑1B fee and associated policy could shape cost structures across the sector. [31] - Does Infosys raise, hold, or narrow guidance again at Q3?
With results due January 14, investors will be listening for any shift in FY26 confidence. [32]
Bottom line (as of December 21, 2025): Infosys stock is having a loud market-structure moment in the U.S. ADR line, but the company’s filings point away from undisclosed fundamentals as the driver. Meanwhile, the underlying investment debate remains anchored in FY26 guidance, buyback and cash-return execution, sector demand trajectory, and the upcoming Q3 results. [33]
References
1. www.infosys.com, 2. www.marketwatch.com, 3. www.infosys.com, 4. www.infosys.com, 5. www.business-standard.com, 6. www.infosys.com, 7. www.infosys.com, 8. www.infosys.com, 9. www.businesstoday.in, 10. www.businesstoday.in, 11. www.investing.com, 12. www.marketwatch.com, 13. www.marketwatch.com, 14. www.infosys.com, 15. www.infosys.com, 16. www.infosys.com, 17. www.infosys.com, 18. www.infosys.com, 19. www.infosys.com, 20. www.infosys.com, 21. www.infosys.com, 22. m.economictimes.com, 23. www.reuters.com, 24. www.investing.com, 25. trendlyne.com, 26. www.infosys.com, 27. www.infosys.com, 28. www.infosys.com, 29. www.investing.com, 30. www.infosys.com, 31. www.reuters.com, 32. www.infosys.com, 33. www.infosys.com
