Techm vs Endurance Technologies Q3 FY26

Tech Mahindra delivered a strong Q3 FY26 with revenue of INR 14,393 crore, up 8.3% YoY, and operating margin expanding 290 bps YoY to 13.1%. Growth was broad-based across comms, manufacturing, retail, and healthcare, with Europe leading geographically at 11.2% YoY. Deal bookings hit a five-year high at $1.096 billion, including a $500M+ European telco win. Management reiterated its FY27 target of growing above peer average and reaching 15% EBIT margin. Key risks include BFSI volatility from furloughs and productivity pass-through, and potential margin headwinds from wage hikes under the new labor code.

Guidance read

FY27 revenue growth above peer average: Management expects to grow higher than the peer average by the end of FY27, supported by strong deal pipeline and large client momentum. FY27 EBIT margin target of 15%: Company remains on track to achieve 15% EBIT margin by FY27, driven by continued operational improvements and gross margin expansion. Large deal ramp in H1 FY27: The $500M+ European telco deal will start ramping in the first half of FY27, contributing to revenue growth.

Risk read

Key risks include BFSI volatility from furloughs and productivity pass-through — BFSI revenue declined 0.8% YoY due to higher-than-normal furloughs and annual productivity gains in a large contract, which may persist.; Wage hike impact on margins — Wage hike timing and quantum are undecided due to new labor code implications; could pressure margins when implemented.; Seasonal normalization in European auto — Manufacturing growth was partly boosted by one-time deliveries in European auto, which will normalize next quarter, creating a headwind..

Promise ledger

Of 3 tracked promises, management 0 met, 1 close, 2 missed.

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Endurance Technologies

Q3 FY26 · Information Technology

Endurance Technologies delivered a strong Q3 FY26 with standalone revenue of ₹2,678.3 crore (+22.2% YoY) and EBITDA of ₹339.1 crore (+18% YoY), though EBITDA margin contracted 40bps to 12.7% due to aluminum cost inflation. PAT grew 8.8% to ₹170.7 crore, impacted by a ₹20.6 crore exceptional charge for new labor codes. The India business saw robust order wins of ₹1,282.8 crore in 9M FY26, driven by four-wheeler castings, solar dampers, and EV components. Key growth drivers include ABS mandate clarity (expected by Q4), new plant ramp-ups (Chennai disc brakes, Shendra castings, alloy wheels), and premiumization trends boosting inverted front forks and ASC. Management guided for controlled capex below ₹800 crore in India and expects full impact of greenfield plants in H2 FY27. Risk: European auto market weakness and order inflow slowdown could persist if regulatory uncertainty on ICE/EV transition continues.

Guidance read

ABS mandate clarity expected by Q4 FY26: Final guidelines for ABS on >50cc 2Ws and EVs >4kW expected by end of March 2026; SOP for dual-channel ABS ECU in Q1 FY27. Capex in India to be controlled below ₹800 crore in FY27: Management plans to sweat assets and keep India capex below ₹800 crore, focusing on automation and profitable growth. Greenfield plants to be fully operational by H2 FY27: Chennai disc brake, Shendra castings, Aurangabad alloy wheel, and Pune battery pack plants will ramp up; full impact in H2 FY27. Solar damper business to double by FY26 end: Exports of solar dampers worth ₹24 Cr in 9M; expected to double by year-end; new US client orders from mid-FY27.

Risk read

Key risks include European auto market weakness and order inflow slowdown — European order inflow declined to €15M in 9M FY26 vs €40M prior year due to regulatory uncertainty on ICE/EV transition and Chinese import competition.; Aluminum cost inflation pressuring margins — Raw material cost increases, especially aluminum (55% of purchases), led to 40bps EBITDA margin contraction; pass-through may be limited.; Delay in ABS mandate finalization — ABS guidelines still awaited; any further delay could push back expected revenue from ABS and hydraulic brake systems.; Execution risk in new plant ramp-ups — Multiple greenfield plants (Chennai, Shendra, Aurangabad, Pune) are under construction; delays in SOP or customer approvals could impact revenue..

Promise ledger

Scorecard data is being built as historical quarters are processed.