As Indian IT companies report their September 2025 (Q2 FY26) earnings, HCL Tech vs Tech Mahindra has become one of the most-watched comparisons on Dalal Street. While both firms delivered modest improvements, HCL Tech clearly outperformed Tech Mahindra across key metrics, from revenue growth to profitability.
In the September 2025 quarter, the revenue of HCL Tech rose 2.4% quarter-on-quarter (QoQ) in constant currency to ₹31,942 crore, driven by strong growth in its public services, life sciences, and Rest of the World segments.
Meanwhile, the revenue of Tech Mahindra grew 1.6% QoQ in constant currency to ₹13,949.9 crore, with its key communications vertical (nearly one-third of its total business) showing a 2% decline. This slower performance put Tech Mahindra behind its larger peer.
Both companies managed to expand margins thanks to better cost control, but HCL Tech’s higher profitability gives it a clear lead on the earnings front.
| Metric | HCL Tech | Tech Mahindra |
| Operating Margin | 20.5% (+60 bps QoQ) | 15.5% (+100 bps QoQ) |
| Employee Cost (% of Revenue) | 57.3% (vs 58% last quarter) | 54.5% (vs 56.2% last quarter) |
| Net Profit | ₹4,236 crore (+10.2% QoQ) | ₹1,201.7 crore (+6.5% YoY) |
HCL Tech’s total contract value (TCV) came in at US$2.57 billion, a sharp 41.8% jump in QoQ, indicating healthy demand for its services. In contrast, Tech Mahindra’s TCV was US$816 million, only a marginal increase from US$809 million in the previous quarter.
On headcount, HCL Tech added more employees, taking its total to 226,640, while Tech Mahindra’s fell to 78,528, showing contrasting hiring trends.
AI remains a common growth driver. HCL Tech’s advanced AI revenue crossed US$100 million, while Tech Mahindra expanded its Agentic AI portfolio from 200+ to 300+ AI agents, highlighting growing automation opportunities.
HCL Tech has raised its FY26 growth guidance to 4–5% in constant currency, signalling confidence in its pipeline. Tech Mahindra did not share a specific growth outlook.
Valuation-wise, HCL Tech trades at 24x FY26 estimated earnings, compared with Tech Mahindra’s 28x, suggesting relatively better value at current levels.
In the HCL Tech vs Tech Mahindra Q2 FY26 scorecard, HCL Tech scored higher due to stronger revenue growth, higher margins, and robust deal wins. While Tech Mahindra showed signs of operational recovery, its reliance on the communications segment continues to weigh on performance. For now, HCL Tech remains the stronger player in India’s IT services race.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.
Published on: Oct 16, 2025, 3:13 PM IST
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