Is Tech Mahindra overvalued or undervalued?

Jul 07 2025 08:02 AM IST
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As of July 4, 2025, Tech Mahindra is fairly valued with a PE ratio of 38.12 and a PEG ratio of 0.48, indicating better growth potential compared to peers like TCS and Infosys, despite having underperformed the Sensex year-to-date but outperformed it over five years.
As of 4 July 2025, the valuation grade for Tech Mahindra has moved from expensive to fair. Based on the analysis, Tech Mahindra is fairly valued at this time. The company exhibits a PE ratio of 38.12, an EV to EBITDA of 22.50, and a PEG ratio of 0.48, indicating a reasonable valuation relative to its growth prospects.

In comparison to its peers, Tech Mahindra's PE ratio is significantly higher than that of TCS at 25.49 and Infosys at 25.51, both of which are considered fairly valued as well. However, Tech Mahindra's PEG ratio of 0.48 suggests it may offer better growth potential relative to its price than some of its peers. While Tech Mahindra has underperformed the Sensex on a year-to-date basis, it has outperformed over a longer horizon, with a 5-year return of 191.90% compared to the Sensex's 131.62%.
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