HSBC - Tech Mahindra

HSBC in their report on Tech Mahindra,

IT spending programs and cost-saving initiatives of BT and other service providers have led to growing demand for offshore technology vendors

We believe positives of USD1bn deal win by Tech Mahindra are largely priced in. Expect initial investments on the deal to drag margins over the next two years

Trades at a premium to peers despite management guiding to lower growth in FY08. We initiate coverage with a Neutral (V) rating and 12-month target price of INR1600