Tech Mahindra to implement 3-year roadmap for company growth

IT services firm Tech Mahindra announced its fourth quarter for fiscal year 2024. For the quarter ending March 2024, the company reported about 41% decline in net profits to ₹661 crore year-on-year (YoY). Revenue for the same period decreased by 6.2% to ₹12,871.3 crore. 

At the sidelines of the results announcement, chief executive officer (CEO) Mohit Joshi, who succeeded CP Gurnani, laid down a roadmap for the company’s growth for the next three years. To be sure, FY25 will be Joshi's first full fiscal as CEO. The Vision 2027 plan outlines focus areas that include organisational restructuring, improvements and investments, and synergising with other Mahindra Group businesses. Joshi said that the company will ramp up deals with active clients, especially the top 80 clients who offer businesses valued at $20 million or above under the Turbocahrge Program. By FY27, the company seeks to grow its revenue faster than the top six or seven IT firms.

Joshi termed FY25 as the turnaround phase where the company will be investing in key accounts, markets, and service lines. In this period, the aim would be to integrate front-end portfolio companies and Turbocharge Program for key account growth. Tech Mahindra will also initiate Project Fortius at this stage. 

Under Project Fortius, the company will focus on organic growth rather than considering acquisitions. Tech Mahindra also plans to hire, train, and deploy freshers which to help them manage costs.

The successive year FY26 would be dedicated towards steering cost savings through Project Fortius, and finally experiencing an improved long term structure mix along with observing returns on the implemented actions.

Cost-saving initiatives will reduce expenses by $250 million per year to reach its margin target. The move will also allow Tech Mahindra to make investments in new capabilities, leading to the rise in new revenue-contributing vertical by FY26, said Rohit Anand, CFO, during the post-earnings analyst call.