Tech Mahindra share price is down 1% in the early trade today after the IT major reported a 4.5% drop in Q2 net profit.. Following the result, the brokerages remain divided in their outlook with some staying bullish while others signal caution amid margin concerns. Let’s take a look at what the brokerages are saying –

Motilal Oswal on Tech Mahindra

The firm has maintained its ‘Buy’ rating on Tech Mahindra, setting a target price of Rs 1,900. This implies an upside potential of 29% from current levels.

According to Motilal Oswal, Tech Mahindra’s performance in Q2FY26 was slightly better than expected on several key metrics. The brokerage noted that the company reported USD 1.6 billion in revenue, up 1.6% QoQ in constant currency, led by strong performance in the Retail, Manufacturing, and BFSI segments. EBIT margin improved by 100 basis points sequentially to 12.1%, beating expectations.

ALSO READ

As per the brokerage report, “The ongoing restructuring under the new leadership is tracking well, and this quarter was another step in the right direction.”

Motilal Oswal added that the company’s turnaround plan remains on course, supported by improving operational efficiency and a stronger outlook in BFSI. “We estimate FY26/FY27 EBIT margins at 12.3%/14.4%, which will result in a 28% profit growth annually over FY25–FY27 on a compounded basis,” the report noted. The brokerage reiterated, “We continue to like TECH Mahindra’s bottom-up turnaround story.”

Nuvama on Tech Mahindra

Not all analysts are equally optimistic. Brokerage firm Nuvama has retained its ‘Reduce’ rating on Tech Mahindra, setting a target price of Rs 1,350. This implies 7% downside from current levels. While the firm pointed to decent second-quarter performance, it remains cautious about the company’s growth trajectory in a challenging macro environment.

According to the brokerage report, Tech Mahindra “posted decent Q2FY26 results,” with revenue at $1,586 million (+1.6% CC QoQ) and EBIT margin expanding to 12.1%, higher than expectations.

However, the report pointed out that margin improvement from here could be harder to achieve. “Margin expansion would be more difficult hereafter, given the low-growth environment, weak macro and limited levers left for expansion,” Nuvama noted.

While appreciating the leadership of CEO Mohit Joshi, Nuvama cautioned that, although the firm is strengthening its fundamentals, “it would be a much longer road to that destination than the Street expects.”

Nomura on Tech Mahindra

The international brokerage firm Nomura has taken a bullish stance, maintaining a ‘Buy’ rating on Tech Mahindra with a target price of Rs 1,670. This translates to a 13.8% upside from current levels.

According to the brokerage report, Tech Mahindra’s management sounded confident about the future, noting that its “pipeline remains strong” and that it expects a “stronger H2FY26E vs H1FY26.” However, Nomura highlighted that the company anticipates a slower pace of growth in FY27 compared to earlier expectations due to macro uncertainties.

Nomura believes the company’s Project Fortius continues to drive positive results, helping boost margins through “delivery excellence, portfolio consolidation and further increasing offshore mix.” The brokerage expects EBIT margins of 12.4–13.5% in FY26–27, compared with 9.7% in FY25.

The report added, “We tweak FY26–FY28 EPS by less than 1% to factor in the Q2FY26 results and raise our target price marginally to Rs 1,670.”