Tech Mahindra Limited (TECHM) AI Stock Analysis

• Market Cap: ₹1.47T
• Dividend Yield: 2.76%
• Average Volume (3M): 51.78K
• Price to Earnings (P/E): 28.8
• Beta (1Y): 0.98
• Revenue Growth: 3.30%
• EPS Growth: 36.78%
• Country: IN
• Employees: 148,731
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 12.64
• Shares Outstanding: 979,743,040
• 10 Day Avg. Volume: 74,125
• 30 Day Avg. Volume: 51,777
• PEG Ratio: 0.36
• Price to Book (P/B): 4.52
• Price to Sales (P/S): 2.33
• P/FCF Ratio: 23.80
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ₹1,755.75
• Price Target Upside: 8.85% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 55 Neutral
• Price Target: ₹1,685.00 ▲(4.46% Upside)
• Action: Reiterated Date: 09/23/25
• Date: Action: Reiterated 09/23/25

Tech Mahindra's overall stock score reflects a combination of financial stability and operational challenges. The strong balance sheet and cash flow are positive, but the negative EBIT margin and high P/E ratio are concerning. Technical indicators suggest potential short-term weakness, and the lack of earnings call data limits insights into future guidance.

Positive Factors

Strong balance sheet

A robust balance sheet with a strong equity base and low leverage provides durable financial flexibility. It supports continued investment in service delivery, cushions against operational volatility, and preserves capacity for strategic actions like acquisitions or restructuring over the next several months.

Stable cash generation

Steady free cash flow and a favorable operating cash flow to net income ratio indicate reliable internal funding for capex, working capital, dividends, and selective reinvestment. This cash resilience supports continuity of managed services and long-term client programs despite near-term earnings pressure.

Diversified IT services mix

A broad portfolio across applications, cloud, network services, engineering and BPO, plus a strong telecom presence, creates durable cross-sell and recurring managed-services opportunities. The diversified delivery model (onsite/offshore) supports margin management and client stickiness over multi-month horizons.

Negative Factors

Negative EBIT margin

Negative EBIT reflects persistent operational inefficiencies or cost-versus-revenue mismatch. If unaddressed, it erodes operating leverage, limits reinvestment capacity, and may force cost restructuring that disrupts delivery and client programs over the medium term.

Modest revenue growth

Stalled or modest top-line growth reduces the company’s ability to leverage fixed costs and improve margins. With only mid-single-digit revenue increases, it becomes harder to offset margin pressure from rising costs or competitive pricing over the coming months without stronger client wins or higher-value services.

Declining shareholders' equity trend

A downward trend in shareholders' equity signals weaker capital retention and may reduce financial headroom. Over a 2-6 month horizon this constrains the firm's ability to absorb continued operating losses, invest in growth initiatives, or pursue opportunistic M&A without external financing.

Tech Mahindra Limited Business Overview & Revenue Model

Company Description

Tech Mahindra Limited provides information technology (IT) services and solutions in the Americas, Europe, India, and internationally. The company operates through IT Business and Business Processing Outsourcing (BPO) segments. It offers IT outsourcing, consulting, application outsourcing, network, infrastructure outsourcing, integrated engineering, BPO, and platform services. The company also provides consulting-led integrated portfolio services to telecom equipment manufacturers and service providers, IT infrastructure service providers, and business process outsourcing service providers; and IT and IT-enabled enterprise solutions. In addition, it offers IT enabled, application development and maintenance, consulting and enterprise business solutions, extended engineering solutions, and infrastructure management services. Further, the company provides data and analytics; IT infrastructure and cloud services; customer experience solutions; enterprise platforms; and enterprise business solutions. Additionally, it offers testing, telecom product engineering, digital supply chain, performance engineering, artificial intelligence, and cyber security services. The company serves communication; banking, financial, and insurance services; energy and utilities; media and entertainment; health life sciences; hi-tech; professional services; manufacturing; retail and consumer goods; travel, transportation, hospitality, and logistics; oil and gas; and public and government sectors. Tech Mahindra Limited was incorporated in 1986 and is based in Pune, India.

How the Company Makes Money

Tech Mahindra generates revenue primarily through its diversified portfolio of IT services and solutions. The company's key revenue streams include IT outsourcing, which involves managing and optimizing IT operations for clients, and digital transformation services, which help organizations modernize their processes and infrastructure. Additionally, Tech Mahindra earns from consulting services, where it provides strategic advice to businesses aiming to enhance their technological capabilities. Telecom solutions form a significant part of its earnings, given its strong presence in the telecommunications sector. The company's earnings are further bolstered by strategic partnerships with leading technology firms, enabling it to offer comprehensive solutions and tap into emerging technologies. These partnerships, along with its global delivery model and investments in research and development, play a crucial role in driving Tech Mahindra's financial performance.

Tech Mahindra Limited Financial Statement Overview

Summary

Tech Mahindra demonstrates financial stability with a strong balance sheet and consistent cash flow generation. However, significant operational challenges are evident in the income statement, particularly with a negative EBIT margin, which could impact future profitability.

Income Statement

Tech Mahindra's income statement reveals mixed performance. The gross profit margin remains healthy, yet there is a stark decline in EBIT margin due to negative EBIT in the recent year, indicating operational challenges. The net profit margin has improved, but the revenue growth has stalled, reflecting stability in sales but potential inefficiencies in operations.

Balance Sheet

The balance sheet of Tech Mahindra is robust with a strong equity base and a low debt-to-equity ratio, highlighting financial stability. The equity ratio is favorable, indicating efficient asset management. However, the declining trend in stockholders' equity over the years suggests challenges in retaining capital.

Cash Flow

Cash flow analysis shows a steady free cash flow, albeit with a slight decline in recent growth rate. The operating cash flow to net income ratio is favorable, indicating strong cash generation relative to earnings. However, the free cash flow to net income ratio has slightly weakened, suggesting potential challenges in capital expenditure management.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	540.56B	529.88B	519.96B	532.90B	446.46B	378.55B
Gross Profit	177.80B	167.32B	154.37B	169.77B	133.11B	119.44B
EBITDA	77.55B	63.34B	44.75B	75.06B	91.35B	75.57B
Net Income	44.85B	42.52B	23.58B	48.31B	55.66B	44.28B
Balance Sheet
Total Assets	458.28B	444.94B	434.24B	461.53B	448.71B	396.78B
Cash, Cash Equivalents and Short-Term Investments	72.79B	74.35B	75.15B	70.38B	84.10B	124.97B
Total Debt	19.54B	20.25B	25.37B	27.40B	26.18B	29.01B
Total Liabilities	178.75B	167.03B	162.77B	177.59B	174.90B	144.34B
Stockholders Equity	275.04B	273.62B	266.69B	279.25B	268.86B	248.65B
Cash Flow
Free Cash Flow	0.00	51.92B	55.85B	45.57B	43.27B	74.28B
Operating Cash Flow	0.00	57.86B	63.76B	55.72B	52.85B	80.94B
Investing Cash Flow	0.00	-232.00M	-13.14B	-2.79B	4.82B	-54.50B
Financing Cash Flow	0.00	-57.99B	-47.67B	-50.78B	-46.67B	-29.87B

Tech Mahindra Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1613.05
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:TECHM, the sentiment is Negative. The current price of 1613.05 is below the 20-day moving average (MA) of 1625.99, below the 50-day MA of 1621.56, and above the 200-day MA of 1535.34, indicating a bearish trend. The MACD of -43.85 indicates Positive momentum. The RSI at 26.47 is Positive, neither overbought nor oversold. The STOCH value of 10.46 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:TECHM.

Tech Mahindra Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COFORGE	73 Outperform	₹460.96B	38.13	―	0.88%	41.97%	38.73%
MPHASIS	73 Outperform	₹464.40B	25.75	―	1.94%	8.73%	11.33%
PERSISTENT	69 Neutral	₹870.54B	49.59	―	0.55%	23.27%	33.09%
WIPRO	68 Neutral	₹2.22T	16.73	―	4.05%	1.10%	14.83%
LTIM	66 Neutral	₹1.50T	31.49	―	1.08%	8.72%	4.54%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
TECHM	55 Neutral	₹1.47T	28.79	―	2.76%	3.30%	36.78%

Tech Mahindra Limited Corporate Events

Tech Mahindra Posts Q3 FY26 Earnings Call Audio, Confirms Compliance with SEBI Norms

Tech Mahindra has informed the stock exchanges that it has concluded its quarterly earnings conference call with analysts, institutional investors, and funds to discuss the audited financial results for the third quarter and nine months ended 31 December 2025. The company referenced its previously shared investor presentation during the call, has made the audio recording of the earnings call available on its investor website, confirmed that no unpublished price sensitive information was disclosed, and noted that the disclosure aligns with SEBI’s Listing Obligations and Disclosure Requirements.

Tech Mahindra Expands African Footprint with New Uganda Subsidiary

Tech Mahindra has announced the incorporation of Yabx Technologies Uganda Limited as a step-down subsidiary in the Republic of Uganda, through its wholly owned subsidiary Yabx Technologies (Netherlands) B.V., which is itself a subsidiary of Comviva Technologies Limited. Yabx Uganda, with initial share capital of UGX 1.7 million, has been set up to provide software and analytics platform services to clients in Uganda, aligning with Tech Mahindra’s core IT and digital services business and expanding its footprint in the African market, which may enhance its regional service capabilities and support growth in emerging digital economies.

Tech Mahindra Secures Independent ESG Rating of 80 from ESGRisk.ai

Tech Mahindra Limited has received an independently assigned ESG rating of 80 from ESGRisk.ai, a SEBI-registered Category I Subscriber-Pays ESG Rating Provider. The rating was issued voluntarily by ESGRisk.ai based on Tech Mahindra’s fiscal 2025 disclosures and other publicly available information, without any engagement or payment from the company, underscoring the company’s transparency on sustainability metrics and potentially strengthening its credentials with investors and other stakeholders focused on environmental, social, and governance performance.

Tech Mahindra Expands into Zambia with New Subsidiary

Tech Mahindra Limited has announced the incorporation of Yabx Technologies Zambia Limited, a step-down subsidiary under Yabx Technologies (Netherlands) B.V., which is a wholly owned subsidiary of Comviva Technologies Limited. This new entity, Yabx Zambia, aims to provide computer programming services in Zambia, aligning with Tech Mahindra’s core business operations. The incorporation signifies Tech Mahindra’s strategic expansion into the Zambian market, potentially enhancing its footprint in the African IT services sector and offering new growth opportunities.

Tech Mahindra Expands African Presence with New Tanzanian Subsidiary

Tech Mahindra Limited has announced the incorporation of a new step-down subsidiary, Yabx Technologies Tanzania Limited, in the United Republic of Tanzania. This subsidiary, under Yabx Technologies (Netherlands) B.V., aims to offer software and analytics platform services in Tanzania, aligning with Tech Mahindra’s core business operations. This strategic move is expected to enhance the company’s presence in the African market, potentially opening new avenues for growth and strengthening its industry positioning.

Tech Mahindra Receives Independent ESG Rating of 77

Tech Mahindra Limited has received an ESG rating of 77 from NSE Sustainability Ratings and Analytics Ltd., a subsidiary of NSE Indices Limited. This rating was independently assigned based on the company’s disclosures for fiscal 2025 and publicly available data, without any engagement from Tech Mahindra. The announcement highlights Tech Mahindra’s commitment to sustainability and may influence its market perception positively.

Tech Mahindra Liquidates Non-Operational Subsidiary to Streamline Operations

Tech Mahindra Limited has announced the voluntary liquidation of its wholly-owned subsidiary, Tech Mahindra Holdco (Pty) Ltd, effective December 9, 2025. The subsidiary was non-operational and did not contribute materially to the company’s consolidated financials. This move is part of Tech Mahindra’s strategic decisions to streamline its operations and focus on more impactful business units, potentially enhancing its market positioning and operational efficiency.

Tech Mahindra Engages Investors at Mahindra Group Investor Day

Tech Mahindra Limited has announced that it will present at the Mahindra Group Investor Day in Mumbai, as part of its ongoing engagement with analysts and institutional investors. The presentation, which will be available on the company’s website, aims to provide insights into the company’s strategies and operations, reinforcing its commitment to transparency and stakeholder engagement.