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Tech Mahindra share price expected to stabilize; target set at ₹1500.
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Tech Mahindra Q2 results beat expectations with 1.6% revenue growth QoQ and improved margins.
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Analysts expect continued cost optimization and selective client focus to drive moderate growth.
Tech Mahindra Share Price: Hold Rating Maintained at ₹1500 Target
Prabhudas Lilladher has issued a “Hold” rating on Tech Mahindra share price with a target of ₹1500. The research report, dated October 15, 2025, highlights that while Tech Mahindra Q2 results were positive, the stock’s upside potential is limited at current valuations.
Analysts believe that the Tech Mahindra share price already reflects near-term improvements in revenue and margins. Investors are advised to hold existing positions rather than aggressively buy, given the current market scenario.
Tech Mahindra Q2 Results Beat Estimates with Revenue and Margin Growth
The Tech Mahindra Q2 results for FY26 showed revenue growth of 1.6% QoQ (constant currency), surpassing the estimated 0.5%. Margins outperformed by roughly 50 basis points, reflecting operational efficiency. This performance comes after two quarters of negative growth in constant currency terms.
However, growth was uneven across verticals. The Communications segment fell 2% QoQ due to telecom sector stress, while the Manufacturing segment reported strong growth of 5.1%. Analysts pointed out that the Automotive vertical, especially commercial projects, continues to face challenges.
Tech Mahindra Share Price Gains Support from Strong Deal Pipeline
A key factor supporting the Tech Mahindra share price is the company’s healthy Total Contract Value (TCV) for Q2 deals. Prabhudas Lilladher notes that scaling “Must-Have” accounts and onboarding high-potential clients is showing early results.
Currently, Tech Mahindra is expanding at least 17 key accounts to USD 1 million+, while rationalizing smaller clients. This focus on high-value accounts is expected to provide a steady revenue base and improve long-term profitability.
Tech Mahindra Q2 Results: Cost Optimization Drives Margin Improvement
The Tech Mahindra Q2 results also reflected ongoing cost optimization measures, such as rationalizing the employee pyramid and leveraging internal initiatives like Project Fortius. Analysts believe these steps will continue in FY26 and FY27 to support margin expansion.
Prabhudas Lilladher’s projections include revenue growth of flat, 4.1%, and 5.2% in FY26E, FY27E, and FY28E, respectively, with margin improvements of 190bps, 250bps, and 30bps year-on-year. These measures provide stability to the Tech Mahindra share price despite macroeconomic headwinds.
Tech Mahindra Share Price Outlook: Limited Upside Ahead
While the Tech Mahindra Q2 results are positive, analysts note that the stock is fairly valued. Based on FY26E and FY27E EPS, the stock trades at 26x and 20x, respectively. The assigned target price of ₹1500, based on a 19x multiple on September 2027 earnings, leaves limited upside.
Investors are advised to hold Tech Mahindra shares at current levels and monitor upcoming quarters for stronger growth signals before adding more positions.
Tech Mahindra Q2 Results and Long-Term Growth Potential
The Tech Mahindra Q2 results indicate gradual recovery, with revenue and margin improvements in select verticals. Analysts note that global IT spending is expected to improve in the second half of FY26, which could boost deal wins and client renewals.
Strategic initiatives, like focusing on high-value accounts and continued cost rationalization, make Tech Mahindra a stable long-term investment option. While the Tech Mahindra share price may not see immediate high gains, the company remains a strong player in the IT services sector.
Conclusion: Hold Tech Mahindra Shares as Target of ₹1500 Set
In summary, the Tech Mahindra share price is well-positioned for stability with limited short-term upside. The Tech Mahindra Q2 results show encouraging signs of recovery, supported by strong deal execution and cost optimization.
Prabhudas Lilladher recommends a “Hold” rating with a target of ₹1500, advising investors to maintain existing positions while monitoring future growth trends.
