Mphasis vs Tech Mahindra Which Is More Profitable?

Mphasis and Tech Mahindra are two prominent players in the Indian IT industry, both offering a wide range of services to clients globally. While Mphasis is known for its focus on domain expertise and innovative solutions, Tech Mahindra is recognized for its strong presence in the telecommunications sector. Investors often compare the two stocks, considering factors such as financial performance, market positioning, and growth potential. Understanding the key differences between Mphasis and Tech Mahindra can help investors make informed decisions about their investment portfolios.

Mphasis or Tech Mahindra?

When comparing Mphasis and Tech Mahindra, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Mphasis and Tech Mahindra.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Mphasis has a dividend yield of 1.92%, while Tech Mahindra has a dividend yield of 3.4%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Mphasis reports a 5-year dividend growth of 20.11% year and a payout ratio of 59.13%. On the other hand, Tech Mahindra reports a 5-year dividend growth of 25.74% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Mphasis P/E ratio at 33.94 and Tech Mahindra's P/E ratio at 46.10. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Mphasis P/B ratio is 6.24 while Tech Mahindra's P/B ratio is 5.71.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Mphasis has seen a 5-year revenue growth of 0.74%, while Tech Mahindra's is 0.50%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Mphasis's ROE at 18.43% and Tech Mahindra's ROE at 12.22%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ₹2819.60 for Mphasis and ₹1666.05 for Tech Mahindra. Over the past year, Mphasis's prices ranged from ₹2144.10 to ₹3187.80, with a yearly change of 48.68%. Tech Mahindra's prices fluctuated between ₹1128.00 and ₹1761.85, with a yearly change of 56.19%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.