Shares of Tech Mahindra rose as much as 3.8% on the BSE on Monday to Rs. 1,734.05, the company reported a year-on-year rise in profit and revenue in the December quarter and won record deals. For Q3FY26, Tech Mahindra reported Rs. 1,122 crore reported a consolidated net profit, up from Rs. 983.2 crore is 14% higher. Respectively, profit of Rs. 1,194 crore was down 6.03%.
Income from operations increased by 8.34% YoY to Rs. 14,393 crore, a quarter-on-quarter growth of 2.85%. Diluted earnings per share Rs. was 12.64.
Brokerage Divided: Buy vs. Hold
The results triggered a reappraisal among brokers, with views split between cautious optimism and outright bullishness.
Nuwama Tech Mahindra upgraded to ‘hold’ from ‘reduce’ and raised its target price to Rs. 1,350 to Rs. 1,650 done. The brokerage said the company “delivered strong Q3FY26 numbers, with +1.7% CC QoQ growth in revenue, beating estimates,” and noted that total contract value was a record USD 1,096 million.
Under the leadership of CEO Mohit Joshi, Tech Mahindra is strengthening its business fundamentals and sustainability while balancing growth and margins, Nuwama said. However, it flagged valuation concerns and remained cautious on profitability ambitions. The brokerage says it remains “sceptical on the 15% margin target” and forecasts 14% margins in FY27, which it said is still a significant achievement. While he said he has a positive return on the company, he added that valuations remain relatively expensive.
Motilal OswalConversely, it reiterated a ‘buy’ rating, arguing that the turnaround in the communications business and steady margin expansion support a more bullish trend. The brokerage’s target is Rs. 2,350, indicating a potential upside of 41% from current levels.
Motilal Oswal said Tech Mahindra reported quarterly revenue growth of 1.7% quarter-on-quarter in constant currency, well ahead of its estimates, with EBIT margin rising 100 basis points quarter-on-quarter to 13.1%. It highlights a major deal win of USD 500 million in Europe in the communication vertical as a major inflection point after a long period of decline. The telecom segment, which accounts for around 35% of total revenue, posted a year-on-year growth of 4.6% in dollar terms, breaking the contractionary trend seen in nine of the last 10 quarters.
The brokerage said it believes the company’s FY27 growth could improve to 4.7% year-on-year in organic constant-currency terms, supported by rising AI-led spending and improved deal conversion. It also said that the 15% EBIT margin target for FY27 now appears “in sight”, with an increasing focus on growth execution.
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