In his latest research report, stock market analyst Ashwani Gujral said that Tech Mahindra Ltd can give good returns in the short term.

According to Mr. Gujral, the stock of the company can be bought with a strict stop loss of Rs 950 to achieve a target of Rs 1250.

Today, the shares of the company opened at Rs 1045 on the Bombay Stock Exchange (BSE). Current EPS & P/E ratio stood at 62.49 and 16.19 respectively.

Tech Mahindra has posted a 44% decline in its consolidated net profit for the three month period ended Sept 30, 2009 on account of interest costs spent on borrowings for getting hold of Satyam Computer Services, coupled with slumping income from its main customer BT and augmented costs.

During the quarter, the company earned a net profit of Rs 169 crore as compared to Rs 302.8 crore during the same period a year ago.

The company's revenues descended 1.9% to Rs 1,141.8 crore from Rs 1,164.8 crore in 2008.

In April 2009, the company had agreed to take over Satyam Computer Services.

To fund the acquirement, Tech Mahindra had lifted debt on which interest expenditure to the tune of Rs 84.3 crore was posted for the second quarter.

Grosses from the company's major customer, BT Group Plc has been slipping for the last several quarters. Across the different contracts that the Mahindra group company has with BT Group Plc, there has been 'valuation pressure' of 5 to 10%.

Furthermore, volumes from the BT account have descended 7%.

During the quarter gone by, Tech Mahindra's overall expenses climbed by 10.6% to Rs 883.26 crore, mainly because of increase in worker costs and travel costs.