India's Tech Mahindra profit rises 16%, misses estimates

Tech Mahindra reported a 16% year-on-year rise in net profit to 13.5 billion rupees (US$145 million) for the March quarter,

The company’s revenue rose 12.6% to 150.8 billion rupees (US$1.61 billion) and margins improved.

Profit rose 20.7% from the previous quarter, while revenue increased 4.7%.

The company attributed this growth to large deal wins and expansion in communications, BFSI, and the technology, media, and entertainment sectors.

The results missed an estimate for profit of 14.3 billion rupees (US$153 million) but beat the revenue forecast of 148.4 billion rupees (US$1.59 billion).

🔗 Source: The Economic Times

🧠 Food for thought

Implications, context, and why it matters.

These results come early in a turnaround plan

The quarter follows a tough stretch. Tech Mahindra launched its ‘Vision 2027’ turnaround plan after consolidated net profit fell 41%, which it tied mainly to weak communications and telecom segments 1.
The three-year plan targets a 15% EBIT margin by fiscal year 2027. It also aims for revenue growth above the peer average among the top six IT services players 2.
The roadmap has three steps. Fiscal year 2025 is the investment phase, fiscal year 2026 centers on stabilization, and fiscal year 2027 aims to outpace peers on growth while reaching industry-standard margins 1.

Tech Mahindra’s approach fits a wider push for efficiency

The company is operating in a slower market. An HSBC report forecast long-term growth of 4% to 5% for the Indian IT services sector amid global economic uncertainty and AI-driven price pressure 3.
Revenue rose, yet total employee headcount fell by 1,559 from a year earlier. That suggests tighter workforce control, though “jobless growth” remains an interpretation rather than a direct claim in the cited source 3.
Tech Mahindra is also pursuing government-linked projects. It said the government of India recognized it in the India AI mission, a national AI program, and it is helping build an indigenous sovereign one-trillion-parameter large language model, a type of AI system trained on vast amounts of data to generate human-like text 3.