Tech Mahindra Q2 Profit Rises 33% to Rs 1,586 Cr; Board Recommends 1:1 Bonus Shares

New Delhi: IT services firm Tech Mahindra on Thursday reported a 32.74 per cent jump in consolidated net profit to Rs 1,585.6 crore for the July-September quarter of FY27 as strong volume growth, cost savings and rupee depreciation lifted operating profit.

The company’s board has recommended a 1:1 bonus issue, under which shareholders will get one bonus share for every share held, as the company marks its 40th anniversary.

The bonus shares are expected to be credited by December 15, according to a regulatory filing.

This is the first bonus issue by Tech Mahindra in 11 years. The company last issued bonus shares in the ratio of 1:1 in March 2015.

The Pune-based company had posted a net profit (attributable to owners of the company) of Rs 1,194.5 crore in the year-ago period.

Tech Mahindra’s revenue from operations rose 15.6 per cent to Rs 16,180.2 crore during the quarter under review, up from Rs 13,994.9 crore in Q2 FY26.

Sequentially, profit and revenue were up by 8 per cent and 3 per cent, respectively.

“Deal wins exceeding USD 1+ billion in each of the last four quarters reflect the strength of our customer relationships and the trust we have built. With 7.2 per cent year-on-year constant currency growth, we continue to sustain business momentum.

“As we celebrate our 40th anniversary this quarter, we look ahead with confidence, building on our legacy of innovation, entrepreneurship, and long-term value creation for our stakeholders,” Mohit Joshi, CEO and Managing Director, Tech Mahindra, said.

He said it was an “extremely strong quarter with broad-based growth across businesses”.

Its operating profit (EBIT) rose 40.5 per cent to Rs 2,387 crore.

Chief Financial Officer Rohit Anand said on an earnings call that this was the twelfth consecutive quarter of margin expansion.

Anand said the margin improvement was driven by strong volume growth and savings under Project Fortius, partially offset by wage hikes.

New deal wins stood at USD 1,023 million in total contract value, up 25.4 per cent from a year ago. Deal wins over the last 12 months rose 34.8 per cent to USD 4,270 million.

Among verticals, communications, the company’s largest vertical, grew 9.5 per cent year-on-year, which Joshi attributed to the ramp-up of the Orange Business large deal and new strategic engagements.

Retail, transport and logistics grew 9.2 per cent, manufacturing 7 per cent, technology, media and entertainment 6.7 per cent, healthcare and life sciences 6.2 per cent, and banking, financial services and insurance (BFSI) 4.6 per cent.

Joshi told reporters that BFSI growth had been “relatively muted” this quarter after 8.5 per cent year-on-year growth in the previous quarter.

“We fully expect to get back to that level or higher in the next quarter,” he said.

By geography, revenue from Europe rose 16.2 per cent year-on-year, while the Americas grew 4.1 per cent and the rest of the world 2.5 per cent.

Its total headcount rose by 5,446 sequentially to 1,52,206.

Joshi said H-1B visa holders make up about 1 per cent of the company’s overall workforce and that it focuses on hiring locally.

The company plans to start reporting revenue from AI in specific buckets from the second half of the fiscal year, Joshi said, adding that it wants to give “exact and specific numbers” rather than ballpark figures.

(Disclaimer: Except for the headline, this article has not been edited by HDFC Sky editorial team and is auto-generated from PTI feed.)