Buy Tech Mahindra; target of Rs 1645: Geojit Financial Services

Geojit Financial Services is bullish on Tech Mahindra has recommended buy rating on the stock with a target price of Rs 1645 in its research report dated August 07, 2024.

Broker Research

August 07, 2024 / 12:55 IST

Buy

Geojit Financial Services research report on Tech Mahindra

Tech Mahindra Ltd develops and markets computer software for telecommunications equipment manufacturers, telecom service providers, software vendors and systems integrators. In Q1FY25, Tech Mahindra reported a revenue decline of 1.2% YoY to Rs.13,006cr, owing to muted performance across certain segments. EBITDA reached Rs.1,565cr, up by 16.9% YoY, with margins improving by 180bps YoY to 12.0% due to reduced subcontracting costs and other expenses. The company expects improvements in telecom and manufacturing segments and stable demand in banking vertical. Strategic initiatives such as adding new clients, new deal wins, AI investments and cost saving programmes such as Project Fortius and Turbocharge, are expected to improve margins and performance.

Outlook

Therefore, we, upgrade our rating to BUY on the stock with a revised target price of Rs. 1,645 based on 25x FY25E adjusted earnings per share (EPS).

For all recommendations report, click here