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Shares of Tech Mahindra jumped on better-than-expected Q1 profit. The stock rose as much as 7.3 per cent to Rs 413.90, its biggest intraday percentage gain since May 25, 2016.
The company had reported a better-than-expected 7 per cent rise in Q1 profit on Monday, helped by new clients for its digital services business.
The performance in Q1 allays fears of earnings downgrades, with reported revenues and margins being better than expectations - Investec says.
It has raises the rating to 'buy' from 'hold', with a price target of Rs 460.
It adds that the management continues to be cautiously optimistic on growth; however, Tech Mahindra is likely to see q-o-q growth going forward after two quarters of consecutive declines.
As of Monday's close, the stock had fallen 21.1 per cent this year.
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