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The market expects Tech Mahindra to do better than it ever has.
At today’s share price, buyers are assuming Tech Mahindra grows about 9% a year, forever. Over the last ten years it actually grew about 4% a year. So the share price only makes sense if the business improves on its own track record. If it simply carries on as before, buyers today have paid for something they will not get.
- How it is valued: Discounted cash flow.
- What the price assumes: 9% growth, against 4% the model takes from its own record.
- Ten-year record: Between FY2018 and FY2026, Tech Mahindra's revenue went from ₹30,773 crore to ₹56,815 crore — it compounded at about 8% a year over 8 years.
- Biggest swing factor: Margin recovery. Main risk: Telecom slowdown.
01The 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.
Mohit Joshi became chief executive in December 2023 and set out a plan to lift margins and growth after a weak period when profit fell sharply.
02What the market is assuming
Work backwards from today's share price and you can see what buyers are quietly taking for granted. Here is the growth that price implies for Tech Mahindra, next to what the model assumes from the company's own record.
The further apart these two numbers are, the bigger the bet a buyer at today's price is making.
03Tech Mahindra's record, in plain numbers
Between FY2018 and FY2026, Tech Mahindra's revenue went from ₹30,773 crore to ₹56,815 crore — it compounded at about 8% a year over 8 years. Net profit grew from ₹3,786 crore to ₹4,806 crore, about 3% a year — slower than revenue, so margins narrowed. In FY2026 it kept 8.5% of revenue as net profit — against a low of 4.6% in FY2024 and a high of 12.6% in FY2022. The latest year added 7.2% to revenue, close to its own long-run pace. FY2021 is missing from the filed series used here, so that year is left out rather than estimated.
Revenue and earnings per share in ₹, return on equity and leverage as ratios — all from the filed statements.
Revenue and net profit by year (₹ crore)
| Year | Revenue | Net profit | Margin |
|---|---|---|---|
| FY2018 | 30,773 | 3,786 | 12.3% |
| FY2019 | 34,742 | 4,289 | 12.3% |
| FY2020 | 36,868 | 3,897 | 10.6% |
| FY2022 | 44,646 | 5,630 | 12.6% |
| FY2023 | 53,290 | 4,857 | 9.1% |
| FY2024 | 51,995 | 2,397 | 4.6% |
| FY2025 | 52,988 | 4,253 | 8.0% |
| FY2026 | 56,815 | 4,806 | 8.5% |
04How Tech Mahindra gets valued — and why
Discounted cash flowThis business is valued on the cash it is expected to generate, discounted back at its cost of capital — with growth taken from its own ten-year record rather than from guidance.
05What decides Tech Mahindra's value
Margin recovery
Closing the margin gap with peers is the main lever.
Telecom demand
Operator spending drives a large share of revenue.
Deal wins
Large contracts show whether growth is returning.
Portfolio pruning
Exiting low-margin businesses lifts profitability.
06What could go wrong
- Telecom slowdown. Operators cut spending when their own growth slows.
- Execution. Turnarounds often take longer than planned.
- Currency. A stronger rupee lowers reported revenue and margins.
07What the full Tech Mahindra valuation shows
Sign in free to see the complete Tech Mahindra valuation
- ✓Fair value per share — from a ten-year discounted cash flow, every step shown
- ✓The Workbench — change revenue growth, the discount rate or terminal growth and watch Tech Mahindra's value move
- ✓Bull, base and bear cases — and exactly which assumptions move between them
- ✓Peer comparison — against TCS, Infosys and Wipro
- ✓Downloadable report — the full write-up, yours to keep
08Compare Tech Mahindra with peers
The same valuation, run side by side.
Tech Mahindra vs Tata Consultancy ServicesThe largest of the IT set, on the same cash-flow model.→Tech Mahindra vs InfosysComparable services mix, a different margin record.→Tech Mahindra vs WiproThe nearest peer on size and telecom exposure.→09Questions people ask about Tech Mahindra
Why did Tech Mahindra's profit fall?
Weak telecom spending, low-margin contracts and restructuring costs hit profit around FY2024.
Who runs Tech Mahindra?
Mohit Joshi has been chief executive since December 2023.
Tech Mahindra or Wipro — which is better value?
Both are valued on the same cash-flow model; the comparison page sets them side by side.
Is Tech Mahindra overvalued?
At ₹1,764 the market is pricing in roughly 9% sustained growth, against the ~4% its own record supports. That is more than it has delivered, so the price is justified only if the business can hold a rate it has not previously sustained.
What is the intrinsic value of Tech Mahindra?
It is computed from the filed financial statements using the method that fits this business (discounted cash flow), with every assumption shown alongside the result. The per-share figure and the full working are in the report.
How much debt does Tech Mahindra carry?
Debt to equity stands at 3.58, against 0.00 at the start of the period — the balance sheet is a core input to the cost of capital used here.