Tech Mahindra shares have unprecedently risen in prices, with a whopping 9 per cent hike when the share market opened today. The share prices have increased in comparison to Thursday’s prices, giving it an all-time high.
The company is earning handsomely, and so are the people, through this hike in the share price and the change can be attributed to two major factors.
Strong First Quarter Financials
Tech Mahindra is an IT firm and against the other IT firms working in the Indian market, Tech Mahindra has managed to earn strong incomes in the first quarter of the financial year 2021-22. The consolidated net profit stood at Rs. 1,353 crore, which shows immense hope to the investors and the market forces.
Last year, for the same period, the consolidated net profit of the company was Rs. 972 crores and the growth registered is about 25 per cent which is unprecedented keeping in view the COVID-19 pandemic and the lockdown that followed.
Consolidated revenue of the company also rose for Tech Mahindra in FY 2022. With a 12 per cent rise, the consolidated revenue stood at Rs 10,198 crore as against last year’s Rs. 9,106 crore.
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If we compare the company’s results with the previous quarter, even then growth of about 4.8 per cent has been registered. While the projected profit margin by brokerages was ranging between 16-23 per cent, the company astonished everyone by outdoing the expectations and reaching a figure above 25 per cent.
5G Roll Out
The Government of India is all set to roll out the 5th generation technology in India, also termed as the 5G. While the 5G scam happened somewhere before 2014, it has only recently happened that India is opening 5G spectrums for public usage.
Considering the contribution of Tech Mahindra in the technology industry of India, the experts in the field are projecting new and heavy investments by the company in this field in the upcoming one or two years.
This roll-out has taken the fancy of several foreign institutional investors. Due to their keen interest, the share market is witnessing a rise. The FII are sure that Tech Mahindra will reap good returns for the Indian tech industry in the future years, considering the developing technological infrastructure in India and Tech Mahindra’s role in it.
These two major factors have led to Tech Mahindra shares rising to an unprecedented level. It seems that in future, good days, aka ache din, are waiting for Tech Mahindra shareholders.
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Sources: Livemint, Zee Business, The Economic Times
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