Shares of Tech Mahindra Ltd rose nearly 10% on Monday after the Indian information technology services company appointed Infosys Ltd veteran Mohit Joshi as its new managing director and managing director.
Joshi has been with rival Infosys for 22 years and is currently the company’s president. He will take charge of Mahindra Group’s IT arm for five years from December 20, the company said in an exchange statement over the weekend.
He replaces CP Gurnani, whose tenure ends on December 19. Joshi’s resignation from Infosys is the second major departure from the company after Ravi Kumar, who resigned as its president in October. At Infosys, Joshi will be on leave from March 11 with the company’s last day on June 9, according to a regulatory filing.
Shares of Tech Mahindra hit a high on Monday, posting the biggest intraday jump in nearly three years, and are the best gainers in the benchmark Nifty IT index, which rose 0.75% at 09:47 IST. Shares of Tech Mahindra rose 8.2% to 1,148.80 rupees, Infosys fell 1.1% to 1,455.05 rupees.
At least three brokers indicated that this is a welcome move for Tech Mahindra. According to ICICI Securities, Joshi has a positive reputation with leading sales, operations and transformation at Infosys and has executive responsibility for all major deals within the company.
However, the brokerage continues to maintain a “reduce” rating on Tech Mahindra, saying the company has room to improve its digital capabilities and will need to invest in this to reignite growth. The current average rating of 39 analysts covering Tech Mahindra is “buy” and the mean target price is 1,143 rupees, according to data from Refinitiv.
