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News Topical, Digital Desk : Tech Mahindra's stock has seen a surge ahead of its quarterly results on April 22nd. On Monday, April 20th, the stock surpassed ₹1,530. Over the past year, the stock has gained 16%, while institutional holdings have seen a significant shift. The market is now focused on the company's profits, margins, major deals, and FY27 vision. The stock's next major move could be expected after the results.
How did the stock perform on Monday?
As of 12:30 p.m., the stock opened at ₹1,510.90, compared to a closing price of ₹1,511.40. This marked a slightly weak start. However, buying increased after the opening, pushing the stock past ₹1,530. This indicates a positive market sentiment ahead of the results.
What returns did it generate?
Looking at returns, the stock has gained 16% in the past year. Over three years, it has gained nearly 50%. However, the data provided also mentions a decline of -9% over three years, suggesting that this could be a reference to different periods or declines from higher levels. Overall, the stock has delivered volatile performance.
A Big Play on Shares:
The promoters hold a 34.97% stake in the company, indicating stable control. The biggest change has been seen in FII and DII holdings. Foreign institutional investors (FIIs) have sold heavily. Their stake, which was 24.2% in December 2024, fell to 17.94% by December 2025. This means foreign investors reduced their stake by more than 6%.
In contrast, domestic institutional investors (DIIs) have made strong purchases. Their stake was 30.91% in December 2024, which increased to 37.95% by December 2025. This means that Indian mutual funds and domestic institutions have increased their confidence in the company.
What are the expectations from the results now?
According to reports, the company's performance may improve in Q4 FY26.
dollar revenue is expected to increase by 0.9% to $1,624 million, compared to $1,610 million in the previous quarter.
Rupee revenue is expected to increase by 2.9% to ₹14,804 crore, compared to ₹14,393 crore in the previous quarter.
EBITDA is expected to be ₹2,035 crore, compared to ₹1,891.6 crore in the previous quarter.
EBITDA margin is expected to be 13.7%, compared to 13.1% in the previous quarter.
Net profit (PAT) is expected to increase 34% to Rs 1,504 crore (15.04 billion rupees), compared to Rs 1,122 crore (11.22 billion rupees) in the previous quarter.
What is the market looking most closely at?
The biggest question is on the company's FY27 Vision. The company's target is to achieve 15 percent EBIT Margin by FY27, to deliver revenue growth higher than the industry average - however Morgan Stanley believes that the company may fall slightly short of the 15 percent margin target in the entire FY27.
Why slow growth in Q4?
According to analysts, constant currency revenue growth may be only 0.5 percent QoQ.
The reasons for this are
- one-off benefits of previous quarters becoming normal now
- impact of European auto deal reducing -
seasonal weakness in the BPS segment,
then how will margins increase?
Margins are expected to improve by 60 basis points. Three major reasons are being cited for this: Project Fortius (an internal cost reduction program), benefit from the weakening rupee, and increased offshoring.
What to watch for:
Brokerages will monitor several key indicators: whether large telecom deals start generating revenue from May-June 2026, the impact of the Middle East crisis on Comviva's business, the announcement of major deal wins and when revenues from them will arrive. Update on the Next 3 Years Plan: will the company start providing annual guidance?
What are brokerages saying?
JP Morgan has an Overweight rating and a target of ₹1,750. They believe that margin recovery will improve valuations.
Nomura has a Buy rating and a target of ₹1,740. CLSA has an Outperform rating and a target of ₹1,556.
On the other hand, there are negative views as well.
Goldman Sachs has a Sell rating and a target of ₹1,340. The concern is regarding telecom and manufacturing exposure. Citi has given a target of Rs 1,275 with a Sell rating. Jefferies has given an Underperform rating and has set a target of Rs 1,180. They say that Revenue and Margin Visibility are weak right now.
What are the indications for investors?
At present, both hope and caution are running simultaneously in Tech Mahindra stock. On one hand, there is hope for margin improvement and big deals, on the other hand, there are questions regarding growth. If the results of 22 April are better than expected and confidence in FY27 vision increases, then the stock may see a new rally. But pressure may also arise if weak guidance is issued.
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