Q4FY21 Result Update - Tech Mahindra - ICICI Direct

Tech Mahindra's (TechM) revenues increased 0.7% QoQ in constant currency terms mainly led by 1.1% QoQ growth in Enterprise revenues. The company also reported EBITDA margins improvement of 45 bps QoQ to 20%. The order book increased from US$455 million to US$1043 million, mainly led by robust growth in Enterprise and Communication segment. The company aspires to have double digit revenue growth in FY22E based on deal wins and EBIT margins at 15%.

Valuation & Outlook

Improving deal pipeline, focus on large deal wins, traction in 5G spend (on communication & enterprise side), revival of growth in manufacturing, acceleration in Europe and cloud is expected to drive revenues. This, coupled with improving margin trajectory and attractive valuation prompt us to be positive on the stock. Hence, we maintain BUY with a revised target price of Rs. 1,120 (16 x PE on FY23E EPS) (earlier target price Rs. 1,120).

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_TechM_Q4FY21.pdf

Shares of TECH MAHINDRA LTD. was last trading in BSE at Rs.969.25 as compared to the previous close of Rs. 963.15. The total number of shares traded during the day was 453597 in over 16344 trades.

The stock hit an intraday high of Rs. 985.65 and intraday low of 944.5. The net turnover during the day was Rs. 436559354.

Source : Equity Bulls

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