Tech Mahindra recommends 1:1 bonus share issue and ₹15 interim dividend

Tech Mahindra recommended a 1:1 bonus share issue and declared an interim dividend of ₹15 per equity share on October 15, 2026. Following the announcement, shares of the information technology services firm surged as much as 8% to an intraday high of ₹1,979 on October 16, according to Mint.

The company announced the recommendations alongside its financial results for the second quarter of the 2026-27 fiscal year. Under the proposed bonus issue, existing shareholders will receive one fully paid-up equity share with a face value of ₹5 for every equity share held of the same face value.

The bonus issue requires shareholder approval through a postal ballot. Tech Mahindra will announce the record date for determining eligible shareholders for the bonus issuance at a later stage. The move is the company's first bonus share issue since March 2015, when it previously issued one bonus share for every share held by investors.

In addition to the bonus recommendation, the board declared an interim dividend of ₹15 per share for the 2026-27 financial year, representing 300% of the share's face value of ₹5. The company set October 23, 2026, as the record date to determine eligible shareholders, with dividend payments expected to be completed by November 13, 2026.

Tech Mahindra has distributed cumulative dividends of ₹168 per share over the past three years. The historical payouts included interim dividends of ₹15 per share in October 2024 and October 2025, as well as a dividend of ₹36 per share declared in July.

Seema Srivastava, senior research analyst at SMC Global Securities, said Tech Mahindra presents strong fundamental tailwinds. Srivastava noted that sustained margin expansion, stable IT attrition at 11.7%, and a deal pipeline above $1 billion show effective execution, while the bonus issue enhances stock liquidity and the interim dividend provides immediate cash flow.