Tech Mahindra Q3 Review – On Expected Lines: Prabhudas Lilladher


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Prabhudas Lilladher Report

Tech Mahindra Ltd. recorded revenue growth of 4.7% QoQ in constant currency, 4.1% QoQ US dollar, in line with our estimates (4.7% QoQ CC, 4.1% QoQ USD).

Organic growth was 4% QoQ USD. Growth was strong in Communications (up 6.2% QoQ USD), while it was weak in the corporate vertical 2.7% QoQ USD due to weakness in Banking, financial services and insurance (down 1.5% QoQ USD) and technology (down 1.9% QoQ USD) driven by the holidays.

Tech Mahindra announced a total contract value of $700 million, up 55% year-on-year, down 6% quarter-on-quarter.

Demand momentum is strong in 5G and network services. Growth momentum in communication is expected to remain healthy as telecom operators adopt an agile approach to contracting by initially creating smaller steps that add up to larger engagements.

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