On a sequential basis, profit and revenue saw growth of 46.81% and 2.36%, respectively.
While announcing the quarterly numbers, the Mahindra Group company also declared an interim dividend of Rs 15 per equity share and fixed November 1 as the record date for determining eligibility of shareholders.
Here is what analysts say:
HDFC Securities: Reduce| Target price: Rs 1,480
Tech Mahindra’s (TECHM) growth and margin trajectory improved yet remain a work in progress. Q2 growth and margin print were slightly ahead of estimates, supported by strong growth in 75% of the portfolio (ex-Manufacturing/Healthcare). The recovery gradient is on the expected lines, yet the task remains steep. The margin improvement was led by strong IT segmental margin improvement, offsetting the drop in BPO margin (BPO 16% of revenue and ~12% of operating profit), a drop in other expenses and flat sub-con expenses.
Motilal Oswal: Neutral: Target price: Rs 1,700
Motilal Oswal stated that it remains on the sidelines, as it believes that the current valuation fairly factors in the uncertainties around growth and margin. Change in estimate for FY25 (increase by 8%) is due to higher other income in 2Q – resulting from exceptional gains on sale of property (operating estimates largely unchanged). The domestic brokerage firm expects FY25/FY26/FY27 EBIT margins at 9.2%/ 12.7%/13.1%, which will result in a 20% CAGR in INR PAT over FY24-27. Nuvama: Reduce| Target price: Rs 1,350
TechM has delivered a decent performance over the last two quarters, beating expectations – which were quite low to begin with. Despite the beat, we see the road to reaching its FY27 targets being a difficult one, given macro and micro factors. Nuvama has tweaked FY25E, 26E and 27E EPS by 3.5%, -0.8% and 0.4% respectively.Also read: JM Financial shares zoom 6% after RBI lifts curbs on co’s non-banking unit
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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