Tech Mahindra
Stock Snapshot
Price Performance
Vista Outlook
View Technicals Analysis →Basis of our Recommendation
Tech Mahindra is navigating a transformative phase under new leadership, marked by 11 consecutive quarters of margin expansion and a strategic pivot towards AI-driven services. Management's focus on achieving a 15% EBIT margin by FY27, alongside strong deal wins in manufacturing and BFSI, supports Vista's forecast of stable revenue growth and margins. The company's disciplined approach to capital allocation and operational efficiency through initiatives like 'Project Fortius' enhances its competitive positioning. However, challenges such as irrational pricing pressures and cautious client spending in traditional sectors remain critical watchpoints. The IT services industry, while expanding, faces headwinds from macroeconomic uncertainties and evolving client demands. Over the next 12-24 months, Tech Mahindra's ability to leverage its AI capabilities and maintain momentum in high-value sectors will be pivotal for sustaining growth and achieving its financial targets
Why We Like This Stock
- Sustained margin expansion driven by operational efficiency initiatives like 'Project Fortius'
- Strong deal wins in high-growth sectors such as manufacturing and BFSI, enhancing revenue visibility
- Management's commitment to achieving a 15% EBIT margin by FY27 supports a positive long-term outlook
Things To Watch Out For
- Irrational competitive pricing pressures could impact margins and profitability
- Cautious client spending in traditional sectors may hinder immediate revenue growth
- Execution risks related to large-scale digital transformations and macroeconomic uncertainties remain significant
Key Parameters
Financial Snapshot
| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 51,996 | 52,988 | 56,815 | 61,562 | 65,743 |
| Profit Before Tax (Cr.) | 3,222 | 5,199 | 6,845 | 9,127 | 9,823 |
| PBT Margin | 6.2% | 9.8% | 1204.8% | 14.8% | 14.9% |
| Net Profit (Cr.) | 2,175 | 3,453 | 4,760 | 6,337 | 6,813 |
| Earnings Per Share | 24.1 | 39.0 | 53.8 | 71.5 | 76.9 |
Analyst Recommendations
| Broker | Recommendation | Target Price | Date |
|---|---|---|---|
| Anand Rathi | ▲ Buy | 1,762 | 17-Jul-2026 |
| Axis Securities | ▲ Buy | 1,735 | 17-Jul-2026 |
| BOB Capital Markets | ► Hold | 1,439 | 23-Apr-2026 |
| Choice Equity | ► Add | 1,600 | 17-Jul-2026 |
| Citigroup | ▼ Sell | 1,345 | 17-Jul-2026 |
| Elara Capital | ► Accumulate | 1,620 | 17-Jul-2026 |
| Emkay Global | ▼ Reduce | 1,450 | 23-Apr-2026 |
| Goldman Sachs | ▼ Reduce | 1,400 | 30-Jun-2026 |
| HDFC Securities | ► Add | 1,650 | 17-Jul-2026 |
| HSBC | ▲ Buy | 1,635 | 17-Jul-2026 |
| ICICI Securities | ► Hold | 1,470 | 17-Jul-2026 |
| IDBI Capital | ▲ Buy | 1,764 | 17-Jul-2026 |
| Jeffries | ▼ Underperform | 1,260 | 17-Jul-2026 |
| Kotak Securities | ▲ Buy | 1,750 | 17-Jul-2026 |
| Moneycontrol | ▲ Overweight | nan | 17-Jul-2026 |
| Morgan Stanley | ▼ Underweight | 1,270 | 17-Jul-2026 |
| Motilal Oswal | ▲ Buy | 1,900 | 17-Jul-2026 |
| Nomura | ► Neutral | 1,600 | 17-Jul-2026 |
| UBS | ► Hold | 1,420 | 23-Apr-2026 |
Company Overview
Show Company Profile
Tech Mahindra Limited provides information technology services and solutions in India, the Americas, Europe, and internationally. The company offers TechM AppGinieZ, a software development lifecycle acceleration platform; Swifter.io, a software engineering platform; ADMSNXT Reforge, an application modernization platform; Autonomous Operations Center, an AI-powered operations platform; and New Age Delivery Platform for DevSecOps and engineering. It also provides LitmusT, a quality engineering and intelligent testing platform; TechM Orion, an agentic AI platform; Ops amplifAler 4.0 for IT operations; Email amplifAler for visualization and automation; SDLC amplifAler solutions; Zone insights solutions for monitoring of object movement; synthetic data generation, freightwatch solutions, cognitive process monitoring, and guardrails framework for AI; VerifAI for scaling AI; and MobiLytix for marketers. In addition, the company offers netOps.ai, an automated cloud platform; AftEAZE solution for warranty and aftermarket problems; AI maturity assessment, generative AI studio, and generative AI performance monitoring; Vision amplifAler, a vision-based solution; Document amplifAler, a digital assistant; and AI-led care, forecasting workbench, AI store, AI adoption, AIOps solution suite, intelligent asset inspection platform, and legal artificial assistant. Further, the company provides business process services, such as consulting CoE and business-process-as-services; Navixus, a digital transformation suite; Cloud and infrastructure services, including enterprise mainframe, FLEX digital workplace, data center services, and CLOUDNXT.NOW, a cloud service; and digital enterprise applications comprising SAP, Oracle, Salesforce, ServiceNow, enterprise digital solutions, digital process solutions, and Emerging Apps. Additionally, it offers engineering, experience, network, and testing services. The company was incorporated in 1986 and is based in Pune, India.