Tech Mahindra's reported Q2 FY27 revenue of $1.7 billion, up 2.4% QoQ in constant currency, above MOFSL's estimate of 1.7% CC growth. Retail/communication/technology rose 9.6%/6.0%/2.8% QoQ, others/manufacturing declined 15.0%/3.9% QoQ (in USD terms). Adjusted PAT stood at Rs 1,600 crore (up 8.2% QoQ/32.8% YoY), below MOFSL's estimate of Rs 1,700 crore. Net new deal TCV was $1,023 million, down 5.1% QoQ and up 25.4% YoY.
NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Motilal Oswal Report
Following Tech Mahindara Ltd.'s September-quarter results, domestic brokerage firm Motilal Oswal has reiterated its 'Buy' call on the sotck setting a target price of Rs 1,950, implying a potential upside of 18% from the reports CMP of Rs 1,650.
Also Read | Layoffs Are Rising In Tech, But These Skills Are Helping People Unlock Better Pay
The brokerage values Tech Mahindra at 20 times FY28E earnings per share. The stocks remains Motilal Oswal preferred pick among large-cap IT companies.
ALSO READ | Tech Mahindra's Q2 Results Impress Jefferies & Kotak, But Citi Still Flags Valuation Concerns
Tech Mahindra Q2 Results Highlights
- Tech Mahindra's reported Q2 FY27 revenue of $1.7 billion, up 2.4% QoQ in CC, above MOFSL's estimate of 1.7% CC growth.
- Retail/communication/technology rose 9.6%/6.0%/2.8% QoQ, others/manufacturing declined 15.0%/3.9% QoQ (in USD terms).
- Ebit margin expanded 40 basis points QoQ to 14.8%, above brokerage's estimates of 14.4%.
- Adjusted PAT stood at Rs 1,600 crore (up 8.2% QoQ/32.8% YoY), below MOFSL's estimate of Rs 1,700 crore.
- Net new deal TCV was $1,023 million, down 5.1% QoQ and up 25.4% YoY.
- In INR terms, revenue/Ebit/adj. PAT grew 16.6%/46.4%/30.6% YoY in H1 FY27. In H2 FY27, the brokerage expects revenue/EBIT/adjusted PAT to grow by 11.7%/28.7%/44.7% YoY.
Valuation and View
The brokerage beileves the ongoing turnaround under the new leadership continues to track well, and this quarter was another step in the right direction as Tech Mahindra is within reach of its FY27 Ebit margin goal of 15%.
Motilal Oswal believes the company could emerge as the growth leader among the large-cap peers and continue to like the bottom-up turnaround story.
Click on the attachment to read the full report:
DISCLAIMER
This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
