Mahindra & Mahindra

Tech Mahindra shares declined 0.9% to ₹1,455 despite delivering better-than-expected operating results in Q2. The company reported constant currency revenue growth of 1.6% versus expectations of 1%, marking the strongest growth in 10 quarters. Both revenue and margins exceeded estimates. The company maintained its FY27 guidance of growth above industry average and operating margin around 15%. Analyst opinions remained mixed: CLSA maintained 'High Conviction Outperform' but cut target price to ₹1,695 citing greater ambiguity around FY27 outperformance goals. Jefferies retained 'Underperform' rating with ₹1,270 target, noting profits missed estimates due to foreign exchange losses and cautioning that H-1B visa costs could make the 15% margin target optimistic. Morgan Stanley kept 'Underweight' rating at ₹1,555 target, highlighting strong deal wins but flagging slow deal-to-revenue conversion and manufacturing vertical weakness. Nomura remained positive with 'Buy' rating and ₹1,670 target, citing healthy deal wins and steady progress in the three-year turnaround plan. The stock has fallen nearly 14% in 2025 and trades at 18.3 times FY27 forward earnings.

Tech Mahindra reported mixed quarterly results with net profit declining 4.4% year-over-year to Rs 1,194 crore compared to Rs 1,250 crore in the same period last year. However, revenue from operations grew 5.1% to Rs 13,995 crore versus Rs 13,313 crore in the corresponding quarter of the previous financial year. The company declared an interim dividend of Rs 15 per equity share for financial year 2025-26, with October 21 set as the record date for determining eligible shareholders.

Tech Mahindra, Cyient DLM, and ICICI Lombard General Insurance are announcing their second quarter earnings. Tech Mahindra is expected to report a 12.7% rise in net profit to Rs 1,285 crore and nearly 3% revenue growth to Rs 13,777 crore. Revenue growth is projected at 0.7-0.8% in constant currency terms, driven by deal ramp-ups and stable communications vertical performance. Sequential growth is expected from improved large deal execution and traction in enterprise, banking and retail segments, though telecom business is expected to remain flat. Cyient DLM is likely to report net profit of Rs 7.49 crore and revenue of Rs 278.4 crore. The banking sector is expected to report softer earnings due to narrowing net interest margins and weak trading gains, despite strong loan growth supported by higher deposit mobilization.