This high dividend yield IT major is on the verge of a breakout

In the derivatives segment, the stock is seeing a long built-up with open interest rising by nearly 2.60 per cent along with a price rise of more than 1 per cent during Thursday’s trading session.

IT stocks are in vogue once again with stocks like Wipro making a life-high on the bourses on Thursday. BSE Sensex is up by nearly 10 per cent on a YTD basis while BSE IT index is up by nearly 16 per cent.

One stock that is showing a lot of promise is Tech Mahindra. Trading at Rs 1,065 per share, the stock is trading close to its life-highs. The stock has gained 9 per cent in one month and is up by more than 86 per cent in one-year period. It is also seen gaining momentum in the recent trading sessions with higher volumes. In the derivatives segment, the stock is seeing a long built-up with open interest rising by nearly 2.60 per cent along with a price rise of more than 1 per cent during Thursday’s trading session. The best part about Tech Mahindra is that at current prices, it is reflecting a dividend yield of more than 4 per cent. 

Tech Mahindra’s export revenues are over 94 per cent. It derives 48.1 per cent revenue from the US, 26.9 per cent from Europe, and 25.0 per cent from the rest of the world. Tech Mahindra enjoyed a revenue share of 41.6 per cent of the total business from the communication vertical in FY20. With the advent of 5G, it is expected to bring in additional growth to the concentrated segment.