Tech Mahindra share price jumps over 3% after strong Q1 results 2026 - Should you buy, sell, or hold the IT stock?

Tech Mahindra Q1 results 2026: IT major Tech Mahindra share price jumped over 3% on Friday, July 17, after it posted strong earnings for the quarter ended June 2026 (Q1FY27).

The IT major posted a consolidated net profit of ₹1465.1 crore, up 28.4% as against ₹1,140.60 crore in the same quarter last year. Meanwhile, its revenue from operations rose 15% to ₹15,605.50 crore versus ₹13,569.5 crore in the year-ago period.

Tech Mahindra reported revenue of $1.66 billion during the June quarter, registering a 6.1% increase year-on-year and a 2.2% rise compared with the March quarter. In constant currency terms, revenue grew 6.6% year-on-year and 2.6% sequentially.

The stock rose as much as 3.4% to its day's high of ₹1,562.90 on BSE. The IT stock has gained 6% in 1 month but lost 7% in 6 months and around 1% in the last 1 year.

Should you buy Tech Mahindra shares?

Brokerages remained optimistic on Tech Mahindra after the IT services company reported a stronger-than-expected performance for the June quarter, with analysts highlighting healthy deal momentum, improving execution and sustained margin expansion. Following the results, several brokerages revised their earnings estimates and target prices higher while reiterating their positive recommendations on the stock.

Elara Securities maintained its 'Accumulate' rating on Tech Mahindra and raised its target price to ₹1,620 from ₹1,550, while increasing its FY27 and FY28 earnings estimates by 1-4%.

"TECHM reiterated its FY27 revenue growth aspiration, targeting growth above the industry's expected 3-5%. We continue to build in around 6%/5% revenue growth in FY27E/FY28E for TECHM on a better outlook for the communications and other verticals," said Elara Securities.

The brokerage noted that the company has also raised its FY27 exit margin aspiration to more than 15%, compared with its earlier target of 15%. It believes the staggered implementation of wage hikes, along with continued optimisation of subcontracting costs and a fresher hiring strategy, should help Tech Mahindra achieve its margin goals. Elara retained its valuation multiple of 18x while cautioning that lower-than-expected earnings remain a key downside risk.

JM Financial also reaffirmed its 'ADD' rating on the stock, raising its target price to ₹1,670 from ₹1,525 after revising its FY28 and FY29 earnings estimates upward by 4-6% and increasing its target valuation multiple to 19x from 18x.

"Tech Mahindra continues to execute well both in growth and margins and will be the growth leader among the large tier in FY27. We raise our target multiple to 19x given the healthy order book and better-than-expected Q1 performance," said JM Financial.

The brokerage expects Tech Mahindra to deliver 5.7% constant currency revenue growth in FY27 and believes the company's strong order pipeline provides healthy revenue visibility over the coming quarters. It said the ramp-up of large deals is expected to support growth in Q2 despite the drag from one-off revenues in the European automotive business. JM Financial also expects seasonal strength in the retail vertical to aid Q3 performance, while Comviva's seasonality could provide an additional boost in Q4. However, it said the phased implementation of wage hikes will remain a key monitorable for margins.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.