Tech Mahindra Ltd. (TECHM) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

Coforge

Tech Mahindra

Persistent Syste

Infosys

LTM

TCS

L&T Technology

Hexaware Tech.

HCL Technologies

Wipro

Mphasis

Why is Tech Mahindra Ltd. ?

High Management Efficiency with a high ROE of 15.86%

The company is Net-Debt Free

Poor long term growth as Operating profit has grown by an annual rate 5.88% of over the last 5 years

The company has declared Positive results for the last 9 consecutive quarters

ROCE(HY) Highest at 22.59%
NET SALES(Q) Highest at Rs 15,711.90 cr
PBDIT(Q) Highest at Rs 2,742.50 cr.

With ROE of 16.9, it has a Very Expensive valuation with a 5.2 Price to Book Value

The stock is trading at a premium compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of 7.71%, its profits have risen by 17.6% ; the PEG ratio of the company is 1.7

High Institutional Holdings at 55.75%

These investors have better capability and resources to analyse fundamentals of companies than most retail investors.

Market Beating performance in long term as well as near term

Along with generating 7.71% returns in the last 1 year, the stock has outperformed BSE500 in the last 3 years, 1 year and 3 months

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Tech Mahindra should be less than 10%
Overall Portfolio exposure to Computers - Software & Consulting should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Computers - Software & Consulting)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Tech Mahindra for you?

Medium Risk, High Return

Absolute

Risk Adjusted

Volatility

Tech Mahindra

7.71%

0.28

27.41%

Sensex

-5.68%

-0.42

13.54%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

8.73%

EBIT Growth (5y)

5.88%

EBIT to Interest (avg)

19.66

Debt to EBITDA (avg)

0.35

Net Debt to Equity (avg)

-0.21

Sales to Capital Employed (avg)

1.73

Tax Ratio

26.21%

Dividend Payout Ratio

93.88%

Pledged Shares

Institutional Holding

55.75%

ROCE (avg)

24.99%

ROE (avg)

15.86%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

5.21

EV to EBIT

18.65

EV to EBITDA

15.04

EV to Capital Employed

6.34

EV to Sales

2.50

PEG Ratio

1.66

Dividend Yield

3.24%

ROCE (Latest)

30.62%

ROE (Latest)

16.93%

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Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bullish

Mildly Bearish

RSI

No Signal

Bullish

Bollinger Bands

Bullish

Moving Averages

Mildly Bearish (Daily)

KST

Bullish

Mildly Bearish

Dow Theory

No Trend

Mildly Bullish

OBV

No Trend

Mildly Bullish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

19What is working for the Company

ROCE(HY)

Highest at 22.59%

NET SALES(Q)

Highest at Rs 15,711.90 cr

PBDIT(Q)

Highest at Rs 2,742.50 cr.

OPERATING PROFIT TO NET SALES(Q)

Highest at 17.45%

PBT LESS OI(Q)

Highest at Rs 2,148.30 cr.

PAT(Q)

Highest at Rs 1,465.10 cr.

CASH AND CASH EQUIVALENTS(HY)

Highest at Rs 5,105.40 cr

EPS(Q)

Highest at Rs 16.54

-2What is not working for the Company

NO KEY NEGATIVE TRIGGERS

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