Key Events This Week
9 Feb: Mojo Grade downgraded to Hold amid mixed technical and valuation signals
11 Feb: Mojo Grade upgraded back to Buy following improved technical outlook
12 Feb: Intraday low hit amid price pressure and sharp open interest surge
13 Feb: Significant gap down opening and three-day consecutive losses
Monday, 9 February 2026: Downgrade to Hold Reflects Caution
Tech Mahindra began the week with a cautious tone as MarketsMOJO downgraded its Mojo Grade from Buy to Hold on 6 February, citing mixed technical and valuation signals. The stock closed at Rs.1,620.95 on 9 February, a marginal gain of 0.11%, underperforming the Sensex’s 1.04% rise. Despite strong fundamentals such as a return on equity of 16.46% and a debt-free balance sheet, concerns over the company’s premium valuation—trading at a price-to-book ratio of 5.8—and a modest five-year operating profit growth rate of 7.37% tempered enthusiasm. Technical indicators showed a shift from bullish to mildly bullish momentum, with weekly MACD remaining positive but monthly MACD turning mildly bearish, signalling potential medium-term weakness.
Tuesday, 10 February 2026: Technical Upgrade Amid Mixed Signals
On 10 February, Tech Mahindra’s stock price rose 1.43% to Rs.1,644.20, outperforming the Sensex’s 0.25% gain. This uptick coincided with an upgrade of the Mojo Grade back to Buy on 11 February, reflecting improved technical momentum. The weekly MACD and KST indicators turned bullish, daily moving averages showed mild bullishness, and institutional ownership remained strong at 55.89%. However, the monthly MACD and KST remained mildly bearish, indicating caution for longer-term investors. The stock traded below its 52-week high of Rs.1,850 but comfortably above its 52-week low of Rs.1,209.70, suggesting a consolidation phase.
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Wednesday, 11 February 2026: Minor Pullback Amid Consolidation
On 11 February, the stock retreated 0.61% to Rs.1,634.20, while the Sensex gained 0.13%. This slight pullback aligned with mixed technical signals, as the stock remained below key moving averages but above longer-term supports. The Mojo Grade upgrade to Buy on 11 February reflected confidence in the company’s fundamentals and medium-term outlook despite short-term volatility. Institutional investors continued to hold a majority stake, supporting stability amid market fluctuations.
Thursday, 12 February 2026: Sharp Decline and Open Interest Surge
Tech Mahindra faced significant selling pressure on 12 February, closing at Rs.1,536.35, down 5.99%, sharply underperforming the Sensex’s 0.56% decline. The stock hit an intraday low of Rs.1,572.4, breaching its 5-day, 20-day, and 50-day moving averages, signalling short-term bearish momentum. This decline was accompanied by a 10.85% surge in open interest in the derivatives segment, rising to 60,049 contracts, indicating heightened investor activity and possible directional bets amid volatility. Despite the price drop, the stock remained above its 100-day and 200-day averages, suggesting underlying longer-term support. Delivery volumes declined, highlighting increased activity from short-term traders and derivatives players rather than long-term holders. The IT sector’s 4.79% fall compounded Tech Mahindra’s weakness, reflecting sector-specific headwinds.
Friday, 13 February 2026: Gap Down and Continued Pressure
The week concluded with Tech Mahindra opening sharply lower at Rs.1,482.6, down 3.03% from the previous close, and closing at Rs.1,535.25 after a 3.67% loss. This marked the third consecutive day of declines, cumulatively eroding 9.22% of value over the period. The stock traded below all major moving averages, signalling sustained downward momentum. Despite this, it marginally outperformed the IT sector’s 4.41% decline on the day. Intraday volatility was elevated, with a weighted average price volatility of 132.12%. Institutional participation remained robust, with delivery volumes surging 222.12% compared to the five-day average, suggesting accumulation or rebalancing by long-term investors amid the correction. The Mojo Grade remained at Buy, reflecting a positive medium-term outlook despite short-term weakness.
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Weekly Price Performance Comparison
| Date | Stock Price | Day Change | Sensex | Day Change |
|---|---|---|---|---|
| 2026-02-09 | Rs.1,620.95 | +0.11% | 37,113.23 | +1.04% |
| 2026-02-10 | Rs.1,644.20 | +1.43% | 37,207.34 | +0.25% |
| 2026-02-11 | Rs.1,634.20 | -0.61% | 37,256.72 | +0.13% |
| 2026-02-12 | Rs.1,536.35 | -5.99% | 37,049.40 | -0.56% |
| 2026-02-13 | Rs.1,535.25 | -0.07% | 36,532.48 | -1.40% |
Key Takeaways
Positive Signals: Tech Mahindra’s strong operational fundamentals, including a high ROE of 16.46%, debt-free balance sheet, and consistent positive quarterly earnings, underpin its medium- to long-term investment appeal. The Mojo Grade upgrade to Buy on 11 February reflects improved technical momentum and institutional confidence, supported by rising delivery volumes and active derivatives participation.
Cautionary Factors: The stock’s premium valuation, with a price-to-book ratio of 5.8 and a PEG ratio around 1.1-1.2, suggests limited margin for valuation expansion. Short-term technical indicators showed a shift from bullish to mildly bullish, with the stock trading below key moving averages and experiencing a three-day losing streak. Sectoral headwinds in the IT software space and broader market volatility contributed to the stock’s underperformance relative to the Sensex, which declined only 0.54% compared to Tech Mahindra’s 5.18% fall.
Market Dynamics: The surge in open interest and elevated derivatives volumes amid falling prices indicate active repositioning by traders, with potential directional bets and hedging strategies in play. The divergence between short-term price weakness and longer-term technical support levels suggests a phase of consolidation and adjustment rather than a fundamental shift.
Conclusion
Tech Mahindra Ltd.’s performance in the week ending 13 February 2026 was characterised by volatility and mixed signals. Despite strong fundamentals and an upgraded Mojo Grade to Buy, the stock faced significant short-term selling pressure, underperforming the broader Sensex and its sector peers. Technical indicators reveal a nuanced momentum shift, with bullish weekly signals tempered by bearish monthly trends and price action below key moving averages. The sharp rise in derivatives open interest amid price declines highlights active market repositioning and investor caution.
Investors should weigh the company’s solid operational metrics and institutional backing against the premium valuation and recent price weakness. The current environment suggests a consolidation phase, with potential for recovery contingent on broader sectoral and market developments. Continued monitoring of technical indicators, volume patterns, and sector trends will be essential for assessing the stock’s trajectory in the near term.
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