SEBI Reg. Investment Advisor

Download App
Help Center Pricing
Money Works 4 Me Logo MoneyWorks4Me
Login Get Free Account
Sign Up

MoneyWorks4Me

Log In Sign Up Schedule Free 15‑min Call
Login Get Free Account
Sign Up

INVESTMENT INSIGHTS

Check Before You Invest : Tech Mahindra Ltd

BSE: 532755 NSE: TECHM ISIN: INE669C01036
  |   Sector:  IT & ITES   |   Industry:  IT - Software

Snapshot

Q.1 Which industry/sub-sector does Tech Mahindra Ltd belong to?
Tech Mahindra Ltd belongs to the IT & ITES sector, operating specifically within the IT - Software segment.
Q.2 Is Tech Mahindra Ltd a good quality company?
Tech Mahindra Ltd is a good quality company, based on a consistently good multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Tech Mahindra Ltd undervalued or overvalued?
Tech Mahindra Ltd appears Somewhat overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 29.8 30.23
Price to Book 4.83 5.01
Price to Sales 2.52 2.64
EV to EBITDA 15.26 17.05
Q.4 Is Tech Mahindra Ltd a good buy now?
Tech Mahindra Ltd is a neutral opportunity now, based on stable price trend analysis suggesting prices may move sideways. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Tech Mahindra Ltd?
Tech Mahindra Ltd revenue growth is 1.9% for FY-2025, which is below its 5-year CAGR of 7.52%, indicating slower growth.

Q.2 Gross Profit margin of Tech Mahindra Ltd?
Tech Mahindra Ltd Gross profit margin which is the profit after deduction of direct costs, is 14.2% for FY-2025, which is below its 5-year median of 15.8%, indicating decreasing margins.

Q.3 Operating Profit Margin of Tech Mahindra Ltd?
Tech Mahindra Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 13.03% for FY-2025, which is below its 5-year median of 14.62% indicating decreasing margins.

Q.4 Net Profit Margin of Tech Mahindra Ltd?
Tech Mahindra Ltd Net Profit Margin is 8.03% for FY-2025, is below its 5-year median of 9.11%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 14.2 15.8
Operating Profit Margin (%) 13.03 14.62
Net Profit Margin (%) 8.03 9.11

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Tech Mahindra Ltd?
Tech Mahindra Ltd Return on Asset is 10.05%, which is below its 5-year historical median of 10.93%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Tech Mahindra Ltd?
Tech Mahindra Ltd Return on capital employed is 20.43% for FY-2025, which is below its 5-year historical median of 22.41%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Q.7 Return on Equity (ROE) of Tech Mahindra Ltd?
Tech Mahindra Ltd Return on equity is 15.9% for FY-2025, which is below its 5-year historical median of 17.98%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Tech Mahindra Ltd?
Tech Mahindra Ltd Cash conversion cycle is 35 days, in line with its 5-year historical median of 37 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 1.25 1.2
ROE (%) 15.9 17.98
ROCE (%) 20.43 22.41
Cash Conversion Cycle 35 days 37 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Tech Mahindra Ltd?
Tech Mahindra Ltd Debt-to-Equity ratio is 0.02, which is above the industry average of 0.01, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Tech Mahindra Ltd?
Tech Mahindra Ltd Debt to cash flow from operations is 0.08, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Tech Mahindra Ltd?

Q.1 Promoter shareholding and pledge status of Tech Mahindra Ltd?
Promoters hold 34.97% of the Tech Mahindra Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Tech Mahindra Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Tech Mahindra Ltd vs industry peers?
Tech Mahindra Ltd revenue CAGR is 7.52%, compared to the industry median CAGR of 10.42%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 1.9 10.4
Gross Profit Growth (%) 49 9.1
Operating Profit Growth (%) 49.4 7.8
Net Profit Growth (%) 77.4 8.7
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.25 1.19
ROE (%) 15.9 24.52
ROCE (%) 20.43 31.91
Cash Conversion Cycle (days) 35.23 43

Valuation & price assessment

Q.1 Stock return of Tech Mahindra Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 11.8% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR		 11.8% 8.3% 11.8% -2%
Q.2 Valuation ratios of Tech Mahindra Ltd vs historical?
The current P/E ratio of 29.8 is in line with than its historical median of 30.23, indicating that the stock is trading near its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median		 5-year
Industry Median
Price to Earnings 29.8 30.23 47.38
Price to Book 4.83 5.01 2.64
Price to Sales 2.52 2.64 4.79
EV to EBITDA 15.26 17.05 16.75

Check more companies

1. TCS
2. Infosys
3. HCL Tech.
4. Wipro
5. Tech Mahindra
6. LTM

Check trending companies

1. Nava Ltd.
2. Honeywell Automation India Ltd.
3. Hindustan Copper Ltd.
4. SBI Life Insurance Company Ltd.
5. Canara Bank
2026 ©The Alchemists Ark Pvt. Ltd. All rights reserved. MoneyWorks4Me® is a registered trademark of The Alchemists Ark Pvt. Ltd.

About MoneyWorks4Me

MoneyWorks4Me is a SEBI-registered Investment Adviser (IA) dedicated to helping investors build long-term wealth through transparent, research-driven, conflict-free guidance. Founded in 2008, we started our journey as a Research Analyst (RA), providing deep fundamental analysis, intrinsic value insights, and long-term investing frameworks for Indian equities. In 2017, we transitioned to a full-fledged SEBI-registered Investment Adviser, strengthening our commitment to acting as a fiduciary—always putting the investor’s interest first.

Our Vision

To become India’s most trusted, research-powered fiduciary advisory platform—where every investor, regardless of experience, can make calm, confident, and well-reasoned investment decisions.

What Makes MoneyWorks4Me Different

Our Approach: Ensuring compounding work its magic on client portfolio.

MoneyWorks4Me ensures this through:

×