Tech Mahindra's deal wins of over $1.3 bn keeping Street sentiment positive

Valuation of over 13 times its FY21 estimated earnings reasonable

Tech Mahindra delivered a better-than-expected performance in the December quarter, led by traction in its largest vertical — telecommunications. The company reported 5.1 per cent growth in revenues at $1.3 billion. 

Growth was largely driven by revenues from the recent order win from AT&T, which helped the telecom vertical post 9 per cent growth. Telecom accounts for about 43 per cent of the company’s revenues. 

The firm indicated that growth in the manufacturing vertical (second-largest) has stabilised, while in the financial services space, it has started gaining some traction.

For the second quarter in a row, the firm reported deal wins of over