Listed firms' annual spend on share buyback lowest in 9 yrs

However, it remains lower than the 10-year average of 35 per cent.

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However, the overall payout ratio declined to 31.8 per cent in FY25 from 33 per cent a year earlier due to a decline in share buyback.

In the last 10 years, companies have paid around 40 per cent of their annual net profits by way of dividend and share buyback.

Analysts attribute the decline in the payout ratio to the virtual end of buyback by information-technology (IT) services majors and companies' tendency to conserve cash.

"The boom in share buyback by the IT sector is over now and companies have no incentive to compensate for it through a higher dividend payout. In other sectors companies are retaining profits either for capex or to tide over the slowdown in revenue and profits," said G Chokkalingam, founder and chief executive officer, Equinomics Research & Advisory.

Muted growth in payout for the second consecutive year in FY25 signals the end of the post-pandemic boom in shareholder income.