Introduction
Tech Mahindra has been round since 1986. It began as a small participant in digital transformation. Now it’s a massive identify in IT companies and BPO.
The corporate helps companies with consulting, cloud, and engineering. It really works in over 90 nations. Many Fortune 500 corporations are its shoppers. This offers it a strong base when it comes to its enterprise prospects.
A current report from a brokerage agency caught my eye. They have been forecasting a ten% worth rise, from Rs. 1510 ranges, in subsequent 8-12 months (from September 2025). The brokerage preferred its robust verticals and deal wins.
However now in November’25, the worth is round Rs 1,424; it has dipped by about 5% since then.
I’m wondering, does this worth dip make it extra interesting for long-term buyers or not?
Let me dig deeper into this. We are going to take a look at its enterprise, funds, and plans. Additionally the dangers.
As an Indian investor myself, I like shares that develop steadily. Tech Mahindra appears to suit this logic. However we want information to determine. So let’s proceed.
Concerning the Firm
Tech Mahindra is a part of the Mahindra Group. Anand Mahindra is the Chairman of Tech Mahindra (like he’s for Mahindra & Mahindra).
It focuses on digital options. They assist corporations who need a trendy IT infrastructure for themselves.
What they do? They construct technique, apps, cloud, and networks.
Their essential focus areas are the next:
- Communications,
- Manufacturing,
- BFSI, Expertise,
- Healthcare, and
- Logistics.
About 84% income comes from IT companies. The remaining ~16% from BPO.
They’ve over 1,100 shoppers. The highest 10 make up 25% of gross sales. This combine retains their dangers low. Why? As a result of first, they’ve very giant shoppers, after which nobody consumer can harm their enterprise earnings an excessive amount of.
The corporate is international. They’re unfold throughout America, Europe, India, and others nations. They serve massive names in power, insurance coverage, media, and extra.
Just lately, they refreshed their model on their thirty ninth anniversary. It’s all about “Scale at Pace.” Examine it right here.
Sounds fancy, however it means serving to corporations change quick with AI and tech. I feel this exhibits they aren’t caught in outdated methods.
Monetary Snapshot
Allow us to examine the numbers of Tech Mahindra. In a brokerate report, they shared previous and future figures.
- Gross sales in FY25 have been Rs 52,988 crore.
- EBIT at Rs 5,111 crore.
- PAT Rs 4,244 crore.
- EPS Rs 48/share.
- They predict progress. By FY27E:
- Gross sales may hit Rs 61,861 crore.
- EBIT Rs 8,699 crore.
- PAT Rs 6,734 crore.
- EPS Rs 69.
Here’s a fast desk:
| Yr | Gross sales (Rs Cr) | EBIT (Rs Cr) | PAT (Rs Cr) | EPS (Rs) | P/E (x) | RoE (%) | RoCE (%) | EV/EBITDA (x) |
|---|---|---|---|---|---|---|---|---|
| FY24 | 51,996 | 2,689 | 2,386 | 27 | 57 | 9 | 9 | 29 |
| FY25 | 52,988 | 5,111 | 4,244 | 48 | 32 | 16 | 15 | 19 |
| FY26E | 56,080 | 6,812 | 5,260 | 54 | 28 | 18 | 17 | 16 |
| FY27E | 61,861 | 8,699 | 6,734 | 69 | 22 | 20 | 19 | 12 |
With the above assumed quantity, the corporate’s EPS is anticipated to progress at a price of 19.9% CAGR in subsequent 2 years.
| Description | FY25 | FY27E | Interval (Yrs) | Progress Charge |
| Gross sales | 52,988 | 61,861 | 2 | 8.05% |
| EBIT | 5,111 | 8,699 | 2 | 30.46% |
| PAT | 4,244 | 6,734 | 2 | 25.96% |
| EPS | 48 | 69 | 2 | 19.90% |
Newest Q2 FY26 outcomes got here in October. Income up 4.8% to Rs 13,995 crore. However internet revenue down 4.5% to Rs 1,195 crore. In {dollars}, income was $1,586 million. Up 1.6% QoQ.
EBIT margin at 12.1%. They declared a Rs. 15 interim dividend. Headcount is 152,714. Down a bit. Attrition is low at 12.8%.
Strategic Initiatives Driving Progress
The brokerage additionally highlighted investments for progress.
Like Mission Fortius for value cuts. Began in FY25. It goals for higher margins. They need 15% EBIT by FY27 (up from 12.1% as of at the moment.
Additionally, their focus is on key accounts and integrating acquisitions.
In Q1 FY26, TCV was $809 million. Up 51% YoY. Then in Q2, new offers at $816 million. Up 35% YoY. Large wins in communications, BFSI, and high-tech. Giant offers are rising. This exhibits shoppers belief them extra.
They’re additionally pushing AI arduous.
- Over 77,000 employees skilled in GenAI.
- 200+ AI brokers in use.
They’re doing key partnerships like with:
- AMD for cloud
- Falcon for banking infra.
- Crosscall for AI mobility in North America.
These strikes may enhance their effectivity in instances to come back.
AI Innovation and Market Place
AI is the large story right here.
Tech Mahindra obtained acknowledged by Gartner as an Rising Chief in GenAI companies (learn right here). They’ve experiences on AI in banking, manufacturing, and retail. Like “Constructing the AI-Pushed Financial institution of Tomorrow.” It talks about modernizing with AI for higher buyer expertise.
- In telecom, AI with 6G for smarter networks.
- In engineering, AI for sustainable merchandise.
This positions them properly. I see how IT corporations like this lead in international tech. However competitors can be powerful from Infosys and TCS.
They gained Frost & Sullivan award for BPM in Asia-Pacific (learn right here). Reveals energy in digital transformation.
Valuation and Outlook
At Rs 1,424, the inventory appears cheaper than September’s Rs 1,509. Market cap round Rs 1.4 lakh crore. 52-week excessive was Rs 1,808, low Rs 1,209. P/E for FY26E is 28. Appears honest for a progress inventory.
The outlook is stronger for H2 FY26. There can be higher offers and restoration for this inventory. Greater progress than friends is anticipated in Tech Mahindra
Here’s a current inventory chart to see the development. You possibly can see that whereas the worth is displaying an upward development however the P/E is colling off. This may be one signal of potential undervaluation.
I feel it’s attractively valued now. There’s a robust upside potential if offers convert in favor of Tech Mahindra, because the administration is planning.
Conclusion
Taking a look at Tech Mahindra’s journey, it jogs my memory how endurance pays within the IT world.
Positive, short-term dips occur with international uncertainties. However their AI push and deal momentum recommend resilience.
For us long-term buyers, it’s like betting on an organization that has seen all of the cycles and has emerged as a winner. I imagine within the long-term know-how on this world. In such a scenario, I personally assume that at present ranges, Tech Mahindra is worth purchase for me. What do you assume?
Have a contented investing.
