1. Opening Hook
Just when everyone had written off large IT as “steady but sleepy,” Tech Mahindra turned up with a €500mn European telecom deal and said, “Surprise.”
While peers debated whether demand recovery is real or imaginary, TechM quietly delivered its fastest growth in three years and its ninth straight quarter of margin expansion.
Europe, once the laggard, is suddenly the hero. Telecom, long declared “ex-growth,” is back in the spotlight. And AI—no longer a PPT buzzword—has moved into actual contracts.
This quarter wasn’t loud. It was methodical. And that’s what makes it interesting.
Stick around—because beneath the calm management tone, there’s a serious pivot underway.
2. At a Glance
- Revenue up 2.7% YoY – Not flashy, but the fastest pace in three years.
- Constant currency +1.3% YoY – Growth without FX makeup. Respectable.
- EBIT margin at 13.1% – Nine quarters up; Fortius gym membership paying off.
- Deal wins $1.1bn – Highest quarterly bookings in five years. No typo.
- Europe +11.2% YoY – Auto ramps and telecom deals doing cardio.
- ROCE 26.9% – Capital finally sweating harder than employees.
3. Management’s Key Commentary (Decoded)
“Highest quarterly deal bookings in the last five years.”
(Translation: Sales engine finally found the ignition 😏)
“€500mn+ European
telecom deal over five years.”
(Translation: Telecom is not dead, just misunderstood.)
“Fastest quarterly growth in the last three years.”
(Translation: We’ve exited survival mode.)
“Margins expanded by 290 bps YoY.”
(Translation: Cost discipline > growth-at-any-cost.)
“Clients are moving from AI pilots to scaled execution.”
(Translation: AI budgets now come with signatures, not just excitement.)
“We aim to grow faster than peers by FY27 with 15% EBIT.”
(Translation: This isn’t a one-quarter sugar rush.)
“We don’t sign large deals that lose money.”
(Translation: No loss-leading heroics, sorry.)
4. Numbers Decoded
| Metric | Q3FY26 | What It Really Means |
|---|---|---|
| Revenue | $1,610 mn | Broad-based, not one-trick growth |
| EBIT Margin | 13.1% | Operational rigor, not FX luck |
| Deal Wins | $1,096 mn | Visibility improves into FY27 |
| FCF | $194 mn | Cash is real, not “adjusted” |
| FCF / PAT | 123% | Accounting behaving well |
| ROCE | 26.9% | Efficiency story finally credible |
One-liner: This is execution-driven growth, not cyclical bounce.
5. Analyst Questions
