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Today's prices ask more of Tech Mahindra than of Tata Consultancy Services.
At current prices, buyers of Tata Consultancy Services are assuming about 0% growth against 7% in its own record; for Tech Mahindra it is 9% against 4%. That shows which share needs more to go right — not which is cheaper. How far each trades from its estimated fair value is in the full valuations.
- Valuation method: both on discounted cash flow.
- Size: Tata Consultancy Services is worth about 5.6 times Tech Mahindra on the stock market.
- Record: On revenue the two have grown at much the same pace: Tata Consultancy Services compounded at about 9% a year (FY2019–FY2026) and Tech Mahindra at about 8% (FY2018–FY2026).
- What to watch: growth in constant currency at Tata Consultancy Services; margin recovery at Tech Mahindra.
| Tata Consultancy Services | Tech Mahindra | |
|---|---|---|
| Price | ₹2,408 | ₹1,764 |
| Market cap | ₹8.72L Cr | ₹1.56L Cr |
| P/E | 16.9 | 34.0 |
| P/B | 8.13 | 5.28 |
| Fair value 🔒 sign in | ₹0,000 | ₹0,000 |
| Upside 🔒 sign in | +00% | +00% |
| Valued on | Discounted cash flow | Discounted cash flow |
01Two businesses
How TCS makes its money
Tata Consultancy Services is India's largest IT services company and part of the Tata group, which holds the majority of its shares. It builds and runs software, cloud and data systems for large companies around the world, with banking and financial services its biggest industry and North America its largest market.
The Mahindra group's IT company
Tech Mahindra, part of the Mahindra group, is one of India's large IT services companies. Its biggest client industry is telecoms — operators and equipment makers — alongside manufacturing, banking and retail. It merged with Satyam Computer Services in 2013.
02The records side by side
On revenue the two have grown at much the same pace: Tata Consultancy Services compounded at about 9% a year (FY2019–FY2026) and Tech Mahindra at about 8% (FY2018–FY2026). By revenue, Tata Consultancy Services is about 4.7 times the size of Tech Mahindra. Tata Consultancy Services kept 18.5% of revenue as net profit in FY2026; Tech Mahindra kept 8.5% of revenue as net profit in FY2026 — a sign of very different business models.
Full ten-year tables and charts are on each company's page: Tata Consultancy Services · Tech Mahindra.
03What each price assumes
Work backwards from each share price and you can see what buyers are taking for granted — the rate each company must sustain to justify what it costs, against what its own record supports.
04What decides each one's value
- Growth in constant currencyTCS earns mostly in dollars, pounds and euros. Constant-currency growth shows how demand is holding up; the rupee then adds to or subtracts from it.
- Operating marginTCS has held one of the highest margins in the industry. On revenue this size, every point of margin is worth thousands of crores of profit.
- Margin recoveryClosing the margin gap with peers is the main lever.
- Telecom demandOperator spending drives a large share of revenue.
05What could go wrong
- Client budget cutsBanks and retailers in the US and Europe trim discretionary IT spending first in a downturn.
- Visa and immigration costsHigher costs for US work visas make onsite delivery more expensive.
- Telecom slowdownOperators cut spending when their own growth slows.
- ExecutionTurnarounds often take longer than planned.
06Which is better value?
Sign in free to see which trades further below its worth
- ✓Both fair values per share — each on the method that fits the business
- ✓Every step of both workings — growth, margins and cost of capital, with sources
- ✓Bull, base and bear cases — for each company
- ✓Downloadable reports — the full write-up for each, yours to keep
08Questions people ask
Is Tata Consultancy Services or Tech Mahindra better value?
That turns on how far each share trades from its estimated fair value. Both figures, with every step of the working, are in the full valuations, free to view once you sign in. On the public numbers, Tata Consultancy Services trades at 16.9 times earnings and 8.13 times book value, and Tech Mahindra at 34.0 times earnings and 5.28 times book value — but multiples alone mislead when two businesses work differently, which is why each is valued on the method that fits it.
What is the difference between Tata Consultancy Services and Tech Mahindra?
Tata Consultancy Services is India's largest IT services company and part of the Tata group, which holds the majority of its shares. Tech Mahindra, part of the Mahindra group, is one of India's large IT services companies.
Are Tata Consultancy Services and Tech Mahindra valued the same way?
Yes — both on discounted cash flow, so their workings compare like for like.
What does today's price assume for Tata Consultancy Services and Tech Mahindra?
Worked backwards from the share price, Tata Consultancy Services needs about 0% growth and Tech Mahindra about 9% growth, against 7% and 4% in their own records.