Tech Mahindra vs Wipro (2026): Growth, Margins, Deals, AI & Which Is Better?
Two Indian IT turnarounds have reached very different stages
Tech Mahindra and Wipro both entered the current cycle with a similar problem: neither was growing fast enough to justify its historical positioning among India's largest IT-services companies.
By Q1 FY2027, their recoveries had diverged.
Tech Mahindra is now growing more than 6% in constant currency, has expanded EBIT margin by more than three percentage points in a year and has recorded three consecutive quarters of more than $1 billion in new deal wins.
Wipro is still near the zero-growth line and its operating margin declined during Q1, but its valuation has collapsed to levels that require far less optimism.
The direct answer: Tech Mahindra's turnaround is working faster, but investors are already paying heavily for it
Tech Mahindra currently has the stronger operating momentum.
Q1 FY2027 constant-currency revenue increased 6.6% year on year.
Wipro's core IT Services revenue increased only 0.9%.
Tech Mahindra PAT increased 28.4%.
Wipro net income increased 0.6%.
Tech Mahindra EBIT margin expanded by about 330 basis points year on year.
Wipro's operating margin declined by approximately 120 basis points.
Yet Wipro trades at less than half Tech Mahindra's P/E multiple.
That makes this comparison less about identifying the better Q1 result and more about deciding how much a successful turnaround deserves to cost.
Tech Mahindra vs Wipro: Q1 FY2027 scoreboard
| Metric | Tech Mahindra | Wipro | Current Edge |
|---|---|---|---|
| Market capitalisation | ₹146,941 Cr | ₹173,010 Cr | Wipro on size |
| Q1 reported revenue | ₹15,712 Cr | ₹24,480 Cr gross revenue | Wipro on scale |
| Reported revenue growth | 17.7% YoY | 10.6% YoY | Tech Mahindra |
| Constant-currency growth | 6.6% YoY | 0.9% YoY | Tech Mahindra |
| Sequential CC growth | +2.6% | -1.2% | Tech Mahindra |
| Operating / EBIT margin | 14.4% | 16.0% | Wipro |
| Margin movement YoY | +~330 bps | -~120 bps | Tech Mahindra trend |
| Q1 PAT / net income | ₹1,465 Cr | ₹3,360 Cr | Wipro on scale |
| Profit growth YoY | 28.4% | 0.6% | Tech Mahindra |
| New / large deal wins | $1.078 Bn new deal wins | $1.626 Bn large-deal bookings | Wipro absolute, definitions differ |
| LTM / total booking context | $4.063 Bn LTM new deals | $3.37 Bn Q1 total bookings | Not directly comparable |
| Free cash flow / cash conversion | $167 Mn; 108% of PAT | OCF ₹3,290 Cr; 98% of net income | Both strong |
| Attrition | 11.8% | 13.9% | Tech Mahindra |
| ROE, Bull Run | 16.89% | 15.49% | Tech Mahindra |
| ROCE, Bull Run | 20.72% | 18.71% | Tech Mahindra |
| Net profit margin, Bull Run | 7.12% | 13.92% | Wipro |
| 5-year sales growth | 8.46% | 8.38% | Essentially tied |
| 5-year profit growth | 1.67% | 4.10% | Wipro |
| P/E | 34.89x | 13.09x | Wipro |
| P/B | 4.96x | 1.97x | Wipro |
| Dividend yield | 3.40% | 6.30% | Wipro |
| Bull Run Score | 41.9/100 | 49.2/100 | Wipro |
Tech Mahindra's Q1 was broad-based rather than driven by one vertical
Every major vertical reported year-on-year growth.
Manufacturing grew approximately 17.2% year on year.
BFSI grew 8.1%.
Retail, logistics and transport grew 8.6%.
Healthcare and life sciences grew 7.2%.
Technology, media and entertainment grew 3.4%.
Even Communications, Tech Mahindra's largest vertical, grew 1.3% despite still facing a difficult telecom-spending environment.
This matters because Tech Mahindra's historical weakness was often blamed on telecommunications exposure.
The current recovery is increasingly being carried by businesses outside telecom.
Communications still defines Tech Mahindra, but it no longer defines all of Tech Mahindra
Communications represented approximately 32.3% of Q1 FY2027 revenue.
That is still enormous.
Telecommunications operators have gone through years of heavy 5G capital expenditure, network-modernisation spending and subsequent cost discipline.
A company with one-third of revenue exposed to that customer group will inevitably feel telecom investment cycles.
But manufacturing has now reached 19.3% of revenue and BFSI 16.7%.
Tech Mahindra is therefore gradually becoming less dependent on a single sector while retaining one of the deepest telecom-technology capabilities among Indian IT companies.
Wipro has a more diversified industry footprint by design
Wipro does not carry the same one-third revenue concentration in telecom.
Its portfolio spans banking and financial services, consumer businesses, healthcare, manufacturing, energy, technology and communications.
Capco also gives Wipro specialised consulting exposure in banking and capital markets.
That diversification reduces dependence on one vertical cycle.
The problem is that the broader mix has not translated into faster company-wide growth yet.
Project Fortius is why Tech Mahindra's recovery looks different from Wipro's
Tech Mahindra's transformation has had an explicit margin target from the beginning.
Management launched Project Fortius with an ambition to exceed 15% EBIT margin by FY2027.
The program focused on fresher hiring, utilisation, offshoring, internal fulfilment, pricing discipline, portfolio-company integration, productivity and reducing underperforming business lines.
The progression is unusually clean:
| Quarter | Tech Mahindra EBIT Margin |
|---|---|
| Q1 FY2026 | 11.1% |
| Q2 FY2026 | 12.1% |
| Q3 FY2026 | 13.1% |
| Q4 FY2026 | 13.8% |
| Q1 FY2027 | 14.4% |
That is five consecutive reported points of margin expansion.
Tech Mahindra is now only about 60 basis points below the original 15% milestone.
Wipro currently has the higher margin anyway
Wipro's Q1 IT Services operating margin was 16.0%.
So Tech Mahindra's successful margin recovery has not yet produced a higher absolute margin than Wipro.
This is an important distinction.
Tech Mahindra wins the direction-of-travel comparison.
Wipro still wins the current absolute margin comparison.
But Wipro's margin trend moved backward in Q1
Wipro's 16.0% margin declined about 130 basis points sequentially and 120 basis points year on year.
Management attributed some of the pressure to investments in strategic priority areas.
Investment is not inherently negative.
A consulting company should invest in talent, AI, capabilities and sales when technology platforms change.
The question is whether revenue subsequently accelerates enough to justify the lower near-term margin.
Tech Mahindra is doing the opposite: revenue and margin are improving simultaneously
Revenue increased 6.6% in constant currency while EBIT margin expanded 330 basis points year on year.
That combination is powerful because turnarounds often require a choice between cutting costs and investing for growth.
Tech Mahindra currently appears to be doing both.
Client concentration is also improving.
Top-five clients represented 14.7% of revenue versus 15.6% a year earlier.
Top-20 client concentration declined to 37.3% from 39.0%.
Large clients are getting larger at Tech Mahindra
The number of clients generating more than $50 million annually increased from 26 to 33 in one year.
$10-million-plus clients increased from 108 to 115.
That matters because a large strategic account can expand across cloud, infrastructure, engineering, data, AI and operations.
Growing wallet share from existing enterprise relationships is often cheaper than acquiring completely new Fortune 500 customers.
Yet Tech Mahindra's total number of $1-million clients fell
$1-million-plus clients declined from 529 to 499 year on year.
That initially looks contradictory.
But it can reflect deliberate portfolio rationalisation.
A consulting company can improve economics by exiting small, low-margin projects while concentrating more revenue in strategic accounts.
The increase in large clients alongside a decline in small clients supports that interpretation.
Wipro's booking number is bigger, but the comparison is not perfectly apples-to-apples
Wipro reported $1.626 billion of large-deal bookings.
Tech Mahindra reported $1.078 billion of new deal wins.
Wipro's large-deal threshold is defined as contracts of at least $30 million in TCV.
Tech Mahindra's published new-deal-win metric uses its own methodology.
Wipro therefore wins the raw Q1 disclosed amount, but the figures should not be treated as identical definitions.
Tech Mahindra's booking consistency is the more interesting signal
Q1 FY2027 was the third consecutive quarter with more than $1 billion of new deal wins.
Trailing-twelve-month new deal wins reached approximately $4.063 billion, up 37.5% year on year.
The individual Q1 number was only slightly above Q4.
The quality signal is the sustained run rate rather than one unusually large contract.
Tech Mahindra's deals are also becoming less telecom-dependent
Q1 wins included payments, healthcare, aerospace, industrial manufacturing, autonomous driving, chemicals and telecom.
This is strategically important.
Tech Mahindra can preserve its communications advantage while using engineering, payments and enterprise technology to broaden the revenue base.
The acquisition of Canada's Avant Techno Solutions is another move toward deeper payments and wealth-platform capability.
Wipro's deal wins are more focused on vendor consolidation and managed services
Wipro has repeatedly highlighted large engagements where clients consolidate multiple technology suppliers into a smaller set of strategic partners.
These deals can create long-duration revenue and significant wallet-share gains.
But transition periods can pressure margins and take several quarters before the full revenue contribution appears.
That lag is one reason Wipro's strong booking performance has not yet translated into strong constant-currency revenue growth.
Tech Mahindra's utilisation reached 87%
IT utilisation increased from 85.0% a year earlier to 87.0%.
This is one of the clearest operational explanations for margin improvement.
Higher utilisation means a greater proportion of the employee base is working on billable client projects.
At an IT-services company with tens of thousands of engineers, a two-percentage-point improvement can materially affect profitability.
Tech Mahindra is also operating with fewer IT employees
IT headcount fell from 79,987 to 74,689 year on year.
Yet revenue increased.
That implies higher revenue productivity and reflects automation, utilisation improvement, pyramid optimisation and portfolio changes.
Total group headcount remained much larger because Tech Mahindra also has a substantial BPS workforce.
Attrition currently favours Tech Mahindra
Tech Mahindra's LTM IT attrition was 11.8% versus Wipro's voluntary attrition of 13.9%.
Lower attrition can reduce recruitment, training and project-transition costs.
It can also improve client continuity.
However, extremely low attrition is not automatically positive if it reflects a weak hiring market rather than superior employee engagement.
Tech Mahindra's free cash flow improved almost as fast as EBIT
Q1 free cash flow reached $167 million, up approximately 94% year on year.
Free cash flow represented 108% of PAT.
Days sales outstanding improved to 84 from 95 a year earlier.
The company therefore did not achieve the earnings turnaround merely through non-cash accounting.
Cash collection improved at the same time.
Wipro's cash conversion remains excellent too
Operating cash flow was approximately ₹3,290 crore, equal to 98% of quarterly net income.
Wipro has also returned more than $3 billion of cash to shareholders across recent payouts and capital-return actions, according to management's Q1 commentary.
Wipro's challenge is therefore not cash conversion.
It is growth and reinvestment efficiency.
AI strategy shows another philosophical difference
Tech Mahindra has built its current AI program under the Helix framework.
The strategy includes industry-specific use cases, partnerships, proprietary models, AI-first delivery, new commercial models, workforce training and explicit AI taxonomy across the pipeline.
It has launched Agentic Development & Modernization Services and is building telecom-specific AI capabilities around network digital twins and private cloud.
Tech Mahindra's strongest AI angle may be telecom itself
Its decades of communications-domain knowledge can become more valuable when telecom networks become software-defined and AI-managed.
Current initiatives include AI-driven 5G network digital twins, private cloud, autonomous network operations and telecom-fintech platform integration.
A generic AI-services vendor can build agents.
Fewer vendors understand network operations, OSS/BSS, 5G, fibre, billing and telecom monetisation at Tech Mahindra's scale.
Wipro is building AI across a broader enterprise-services footprint
Wipro Intelligence, WEGA and WINGS are being embedded across software development, infrastructure, cybersecurity, workplace management and business processes.
Wipro also has consulting-led access through Capco and alliances with major hyperscalers and AI platforms.
The limitation for investors is measurement.
Wipro does not currently disclose a clean AI-revenue number that can be tracked quarter by quarter.
Tech Mahindra does not disclose a directly comparable AI-revenue figure either.
So this comparison should focus on client wins and actual revenue growth rather than marketing claims.
Capital efficiency currently favours Tech Mahindra only modestly
Bull Run records Tech Mahindra ROCE at approximately 20.72% and Wipro at 18.71%.
ROE is 16.89% versus 15.49%.
That is a real advantage, but not large enough to explain Tech Mahindra trading at more than two and a half times Wipro's P/E.
The valuation premium is therefore based primarily on expectations of future margin and earnings growth.
Long-term growth does not yet support a huge Tech Mahindra premium
Five-year sales growth is almost identical.
Tech Mahindra is approximately 8.46%.
Wipro is approximately 8.38%.
Five-year profit growth actually favours Wipro at 4.10% versus Tech Mahindra at 1.67%.
Tech Mahindra's current valuation is therefore pricing a break from its historical growth trajectory.
Valuation is the hardest part of the Tech Mahindra case
Tech Mahindra trades at approximately 34.9x trailing earnings.
Wipro trades near 13.1x.
Tech Mahindra also trades around 5.0x book compared with Wipro below 2.0x.
The premium can compress naturally if Tech Mahindra's earnings grow rapidly.
But today's buyer is already assuming that Project Fortius and stronger revenue growth continue delivering meaningful profit expansion.
Why Tech Mahindra's P/E can look unusually high during a turnaround
Trailing P/E uses profits from the previous twelve months, including quarters before the margin recovery was fully visible.
If EBIT margin rises from roughly 11% to 15% while revenue also grows, forward earnings can increase much faster than revenue.
That can make a high trailing multiple fall without the share price declining.
The risk is that investors pay for future margin expansion that does not arrive.
Wipro needs much less improvement to surprise the market
A 13x P/E creates a very different starting point.
If Wipro merely returns to low-single-digit growth while protecting a 16%-plus margin, earnings expectations can stabilise.
If large-deal revenue pushes constant-currency growth materially higher, a valuation rerating becomes plausible.
Wipro therefore has more room for positive surprise, but current evidence is weaker.
Dividend yield reinforces the valuation difference
Wipro's trailing dividend yield is approximately 6.3% versus Tech Mahindra around 3.4% in Bull Run's August 25 snapshot.
Tech Mahindra has historically returned substantial cash too and declared ₹51 per share of total FY2026 dividends.
But Wipro's lower share-price valuation currently produces the higher yield.
The stock market has already rewarded Tech Mahindra's turnaround
| Market Metric | Tech Mahindra | Wipro |
|---|---|---|
| Price on 25 Aug 2026 | ₹1,599.90 | ₹180.09 |
| 1-month return | +1.50% | +2.84% |
| 3-month return | +9.91% | -10.66% |
| 6-month return | +17.48% | -10.44% |
| 1-year return | +4.77% | -29.05% |
| 52-week high | ₹1,854 | ₹273.10 |
| 52-week low | ₹1,304.10 | ₹169.00 |
| RSI (14) | 37.01 | 43.94 |
Tech Mahindra has outperformed Wipro by more than 30 percentage points over one year.
The market is already differentiating between a turnaround that is producing visible operating gains and one that remains in an earlier stage.
Tech Mahindra: what the market is paying for
Turnaround evidence
- 6.6% CC revenue growth.
- 14.4% EBIT margin.
- 330 bps YoY margin expansion.
- PAT up 28.4%.
- Three consecutive $1 Bn+ deal-win quarters.
- 108% FCF-to-PAT conversion.
- DSO improved to 84 days.
- Attrition down to 11.8%.
What can still go wrong
- P/E near 35x.
- Margin remains below Wipro's.
- Communications still contributes 32% of revenue.
- Five-year profit growth remains weak.
- AI monetisation is not separately disclosed.
- Project Fortius benefits become harder after initial cost removal.
Wipro: what a recovery buyer is underwriting
What makes valuation attractive
- P/E near 13x.
- P/B below 2x.
- 6.3% trailing dividend yield.
- 16.0% operating margin.
- 98% cash conversion.
- $1.626 Bn Q1 large-deal bookings.
- Large global client base.
What needs to change
- CC growth must move above 1%.
- Sequential revenue needs to turn positive.
- Margin decline needs to stop.
- Large deals need faster revenue conversion.
- ROCE should improve.
- AI investments need measurable commercial returns.
Tech Mahindra vs Wipro: who currently wins each category?
Revenue scale: Wipro.
Constant-currency growth: Tech Mahindra.
Sequential growth: Tech Mahindra.
Current operating margin: Wipro.
Margin improvement: Tech Mahindra.
Profit growth: Tech Mahindra.
Large disclosed Q1 deal value: Wipro, with definition caveat.
Sustained recent new-deal momentum: Tech Mahindra.
Cash conversion: Both strong.
Attrition: Tech Mahindra.
ROE: Tech Mahindra slightly.
ROCE: Tech Mahindra slightly.
Net profit margin: Wipro.
Five-year sales growth: Essentially tied.
Five-year profit growth: Wipro.
Lower P/E: Wipro by a wide margin.
Lower P/B: Wipro by a wide margin.
Dividend yield: Wipro.
Recent stock performance: Tech Mahindra.
Bull Run Score: Wipro.
Tech Mahindra vs Wipro FAQs
Which is growing faster?
Tech Mahindra. Q1 FY2027 constant-currency revenue grew 6.6% year on year compared with Wipro IT Services at 0.9%.
Which has the higher operating margin?
Wipro currently, at 16.0% versus Tech Mahindra's 14.4% EBIT margin.
Which has stronger margin momentum?
Tech Mahindra. Its EBIT margin expanded approximately 330 basis points year on year, while Wipro's margin declined around 120 basis points.
Which is cheaper on P/E?
Wipro by a wide margin, at approximately 13.1x versus Tech Mahindra around 34.9x.
Which is cheaper on P/B?
Wipro, at approximately 2.0x book versus Tech Mahindra around 5.0x.
Which has stronger recent stock performance?
Tech Mahindra, with positive three-, six- and twelve-month returns in the August 25 Bull Run snapshot while Wipro was negative over those periods.
What is Tech Mahindra's biggest current strength?
The combination of accelerating revenue and expanding margin, rather than relying on cost cutting alone.
What is Wipro's biggest current advantage?
Valuation. Expectations are substantially lower, while the company still generates strong cash flow and maintains a 16% operating margin.
Research sources
Disclaimer
This article is educational and informational only. IT-services companies should be compared using constant-currency revenue growth, operating margin, deal quality, client concentration, cash conversion, talent productivity, AI monetisation and capital efficiency. Tech Mahindra's new-deal-win metric and Wipro's large-deal-booking metric use different definitions and are not presented as directly interchangeable. Trailing valuation multiples can also look unusually high during a margin turnaround because they include earnings from weaker historical quarters. Financial metrics, exchange rates and market prices change over time. Nothing here recommends buying, selling or holding Tech Mahindra, Wipro or any other security. Bull Run is not a SEBI-registered Research Analyst or Investment Adviser.