Can you believe that an Indian company, which just managed to get through subscription of its first initial public offering thirteen years ago, has posted 2,00,000 per cent returns?
Yes, Infosys Technologies, which came out with an IPO in February 1993 at a premium of Rs 95 for a face value of Rs 10 per share, has posted over two lakh per cent returns.
In other words, an investment of Rs 10,500 in 100 shares made 13 years ago is now valued at almost Rs 2 crore (Rs 20 million) by way of appreciation and dividends. The stock market returns aggregate Rs 1.93 crore (Rs 19.3 million), and dividends in the last 10 years total around Rs 600,000 - making a total return of around Rs 1.99 crore (Rs 19.9 million).
The Rs 88 crore (Rs 880 million) software company 10 years ago is a $2 billion entity today. It took Infosys 23 years to reach the first billion dollars in revenues, but the next billion dollars was achieved in 23 months.
The company has a stupendous track record of increasing shareholders wealth by way of bonus shares and distributing hefty dividends. After the IPO in February 1993, the company declared bonus in the ratio of 1:1 in 1994. In 1997 and 1999, too, the company gave bonus shares in the ration of 1:1 followed by stock split in the ratio of 1:1 in 2000.
Infosys came out with a liberal bonus issue in the ratio of 3:1 in 2004, and has proposed a bonus of 1:1 for 2006.
After giving moderate dividends till financial year 2001, Infosys began to propose liberal dividends. In FY2001, the company declared 200 per cent dividend and stepped it up to 400 per cent next year. It declared 540 per cent dividend in 2003, and 2590 per cent in 2004 including a special dividend of 2000 per cent. For FY2006, the company has proposed a dividend of 900 per cent.
Infosys has benefited immensely by the technology boom, and so has Wipro. If the shareholders of Infosys Technologies have reaped the gains, Wipro shareholders have also been rewarded with mind-boggling gains. The Rs 75,000 invested in Wipro in 1994 is currently valued at Rs 1.90 crore (Rs 19 million) - a return of 25,000 per cent!!Do you want to discuss stock tips? Do you know a hot one? Join the Stock Market Investments Discussion Group
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