Tech Mahindra gains after brokerage upgrade

Tech Mahindra rose 2.67% to Rs 1,341 at 15:00 IST on BSE after a foreign brokerage upgraded the stock to 'buy' from 'sell'.

Meanwhile, the BSE Sensex was down 212.95 points, or 1.08%, to 19,514.32.

On BSE, 86,000 shares were traded in the counter compared with average volume of 1.61 lakh shares in the past one quarter.

The stock hit a high of Rs 1,343 and a low of Rs 1,314.50 so far during the day. The stock hit a 52-week high of Rs 1434.30 on 3 September 2013. The stock hit a 52-week low of Rs 865.25 on 7 December 2012.

The stock had underperformed the market over the past one month till 27 September 2013, sliding 3.99% compared with the Sensex's 9.79% rise. The scrip had, however, outperformed the market in past one quarter, rising 21.48% as against Sensex's 4.51% rise.

The large-cap company has an equity capital of Rs 232.39 crore. Face value per share is Rs 10.

A foreign brokerage upgraded the stock to 'buy' from 'sell' and raised its target price to Rs 1,650 from Rs 920, citing potential earnings upside, cheap valuations.

The brokerage added that the recent rupee weakness will help offset some of the cost associated with trying to increase revenue.

Tech Mahindra's consolidated net profit rose 8% to Rs 686.30 crore on 9% growth in sales from services to Rs 4103.20 crore in Q1 June 2013 over Q4 March 2013.

Tech Mahindra is a leading provider of solutions and services to the telecommunications industry, majority stake owned by Mahindra & Mahindra. The company serves telecom service providers, equipment manufacturers, software vendors and systems integrators

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