Tech MahindraNSE:TECHM -3.03%82 Gross Margin % is 36.38% as of Mar. 2026, which is 19% above its 10-year median of 30.55. GuruFocus rates NSE:TECHM with a GF Score™ of 82/100 and a GF Value™ of ₹1,561.08 (Modestly Undervalued). The stock has 3 warning signs investors should review. Among 2,680 Software companies, Tech Mahindra ranks worse than 55.93% on this metric.
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Tech Mahindra had a gross margin of 36.38% for the quarter that ended in Mar. 2026 => Competition eroding margins
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Tech Mahindra Gross Margin % Related Terms
Tech Mahindra Gross Margin % Historical Data
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The historical data trend for Tech Mahindra's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
NSE:TECHM vs IBM, ACN, FISV: Gross Margin % Comparison
For the Information Technology Services subindustry, Tech Mahindra's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Tech Mahindra Gross Margin % vs Software Industry
For the Software industry and Technology sector, Tech Mahindra's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Tech Mahindra's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Tech Mahindra (NSE:TECHM) has a Gross Margin % of 36.38% as of Mar. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on Tech Mahindra and its competitors. This is 19% above median its historical median of 30.55. Over the past decade, Tech Mahindra's Gross Margin % has ranged from 24.94 to 35.62. According to the industry distribution chart, Tech Mahindra ranks #1499 out of 2680 companies in the Software industry, placing it in the top 55.9%.
Is Tech Mahindra's Gross Margin % too high?
Tech Mahindra's current Gross Margin % of 36.38% is 19% above median its 10-year median of 30.55. Over the past 10 years, this metric has ranged from a low of 24.94 to a high of 35.62. The Software industry median Gross Margin % is 40.45. Tech Mahindra's value of 36.38% is 10.1% below this industry median. Based on the distribution chart, Tech Mahindra ranks #1499 out of 2680 companies in the Software industry, which is below the industry midpoint. Overall, Tech Mahindra has a GF Score™ of 82/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Tech Mahindra's Gross Margin % compare to IBM and ACN?
According to the Software industry distribution chart, Tech Mahindra ranks #1499 out of 2680 companies for Gross Margin %. This places Tech Mahindra in the lower half of its industry. The industry median Gross Margin % is 40.45. Tech Mahindra's value of 36.38% is 10.1% below this benchmark. Historically, Tech Mahindra's own Gross Margin % has ranged from 24.94 to 35.62 over the past decade. While the company's 10-year median is 30.55 vs. the industry median of 40.45, Tech Mahindra has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Gross Margin % for a Software company?
The median Gross Margin % among Software companies is 40.45, based on 2,680 companies in the industry. Companies in the top quartile (top 25%) have a Gross Margin % significantly above this median, while those in the bottom quartile fall well below. However, Gross Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Tech Mahindra's current Gross Margin % of 36.38% is 10.1% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Gross Margin % mean?
A high Gross Margin % can signal that a stock is expensive relative to its fundamentals. Gross margin is the ratio of total gross profit to net sales. View historical data on Tech Mahindra and its competitors. For the Software industry, the median Gross Margin % is 40.45 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Tech Mahindra's current Gross Margin % is 36.38%, which is 19% above median its own 10-year median of 30.55. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Tech Mahindra stock overvalued right now?
Based on GuruFocus' analysis, Tech Mahindra (NSE:TECHM) is currently considered Modestly Undervalued. The stock's GF Value™ is ₹1,561.08, compared to a current price of ₹1,362.20 — trading 12.7% below its estimated fair value. The current Gross Margin % is 36.38%, which is 19% above median its 10-year median of 30.55 and 10.1% below the Software industry median of 40.45. Tech Mahindra's overall GF Score™ is 82/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Gross Margin % calculated?
Gross Margin % is calculated from a company's financial statements. For Tech Mahindra (NSE:TECHM), the current Gross Margin % is 36.38% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Tech Mahindra (NSE:TECHM) Overvalued in 2026?
Based on GuruFocus' analysis, Tech Mahindra stock appears to be undervalued.
The current stock price of ₹1,362.20 is trading 12.7% below its estimated GF Value™ of ₹1,561.08.
GuruFocus considers Tech Mahindra to be Modestly Undervalued.
Key valuation signals for NSE:TECHM:
Gross Margin %: 36.38% (19% above median its 10-year median of 30.55)
GF Value™: ₹1,561.08 vs. price of ₹1,362.20 (12.7% below fair value)
Industry Position: 10.1% below the Software median (#1499 of 2680)
No single metric tells the full story. See the NSE:TECHM stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Tech Mahindra Ltd is an IT services and consulting company in India. It offers a variety of technology solutions and services in addition to business process services. Its segments are Information Technology and Business Process Services. The technology solutions include helping companies engage in cloud software, mobile solutions, network services, cybersecurity, and a variety of other options. The business process service is offered across various industries including telecom, financial services, retail, energy, hospitality, high-tech, agriculture, and food beverage. The company generates the majority of its revenue from Communications & Media & Entertainment Industry. Geographically the company generates the majority of its revenue from the Americas.
82GF Score
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