Shares of Tech Mahindra Limited fell nearly 3% on Thursday, tracking a wider sell-off in Indian IT stocks as investors weighed a quarterly profit miss against the company's record-high dividend payout.
The stock touched an intraday low of ₹1,418.00 on the National Stock Exchange, down from its previous close of ₹1,462.60. The decline comes despite the company’s board recommending a final dividend of ₹36, taking the total payout for the fiscal year 2026 to ₹51 per share.
Tech Mahindra’s fourth-quarter net profit rose 16% year-on-year to ₹1,353.8 crore. However, this figure fell short of Bloomberg's consensus estimate of ₹1,509 crore. While revenue grew 12.6% to ₹15,076 crore, beating some street expectations, the profit miss prompted several brokerages to maintain a cautious stance.
Sectoral Headwinds
The IT index has been under intense pressure this week, triggered by HCL Technologies’ weak outlook and an 11% plunge in its shares. Analysts noted that while Tech Mahindra’s telecom vertical showed resilience, the overall sentiment remains bearish due to “AI deflation," a trend where automation and artificial intelligence compress traditional deal sizes.
As of 10:36 IST, the stock was trading at ₹1,424.50. Technical data shows the stock is currently trading below its key 50-day and 100-day moving averages. Heavy activity in the ₹1,400 put options suggests that traders are bracing for further potential downside if the current support levels are breached.
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