Tech Mahindra posted good numbers for 3QFY2019 on all fronts. Revenues rose
3.5% qoq to end the period at US$1,261mn. On CC (constant currency) terms of
the 4.3% qoq. In Rupee terms, revenues came in at `8,944cr v/s. `8,630cr in
2QFY2019, up 3.6% qoq. On the operating front, the EBITDA margin came in at
19.3% v/s. 18.8% in 2QFY2019, a qoq expansion of 50bps. Consequently, PAT
came in at `1,203cr v/s. `1,064cr in 2QFY2019, a growth of 13.0% qoq. The stock
has witnessed a good run-up and hence offer little upsides in near term;
hence, we maintain our neutral rating.
Outlook and valuation: We expect a CAGR of 6.8% and 10.2% in USD and INR
revenue respectively over FY2018-21E. The PAT is expected to grow at a
CAGR of 10.1% over FY2018-21E. We recommend our neutral rating.

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