India’s IT sector is projected to hit $282.6 billion in FY25, growing 5.1 percent year-on-year. Exports may reach $210 billion, accounting for 18 percent of global outsourcing. IT spending is expected to grow 11.2 percent to $160 billion, with job opportunities rising 15–20 percent industry-wide.
With a market capitalization of Rs 1.55 lakh crore, the shares of Tech Mahindra Ltd were trading at Rs 1,595 per share, increasing around 1.20 percent as compared to the previous closing of Rs 1,572.50 apiece.
Brokerage Comments
CLSA, one of the well-known brokerages globally, upgraded this IT stock to ‘high conviction outperform’ with a target price of Rs 1,976 apiece, indicating a potential upside of 24 percent from Wednesday’s price of Rs 1,595 per share.
CLSA observed that Tech Mahindra is adhering to its three-year turnaround plan launched in April 2024 and is on course to achieve its FY27 targets: 15% EBIT margin, 30% ROCE, and revenue growth surpassing the industry average.
CLSA also stated that Tech Mahindra’s progress on revenue and cost management boosts confidence in achieving its FY27 targets. The brokerage also noted that recent shifts in the U.S. tariff landscape have improved the macroeconomic outlook, potentially paving the way for a positive stock rerating in the near term.
Vertical Performance FY25
Tech Mahindra’s FY25 vertical revenue mix: Communications leads at 33.1 percent (–5.0 percent YoY), Manufacturing 17.3 percent (–1.6 percent), Banking, Financial Services & Insurance 16.1 percent (+4.3 percent), Technology, Media & Entertainment 13.9 percent (–0.4 percent), Retail, Transport & Logistics 7.9 percent (+4.4 percent), Healthcare & Lifesciences 7.5 percent (+3.7 percent), Others 4.3 percent (+16.0 percent). These segments represent Tech Mahindra’s diverse industry exposure.
Partnerships & New Launches
Tech Mahindra launched its ‘TechM Consulting’ service line and inaugurated a Manufacturing Xperience Centre in Chennai. It partnered with NVIDIA to develop AI-driven pharmacovigilance via its TENO framework, expanded its Google Cloud alliance, collaborated with Qualcomm through IndusQ LLM, and joined the AI-RAN Alliance to advance AI solutions in telecom.
Written by Abhishek Singh
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