On the back of the recent price correction, CLSA has upgraded the stock and stated that initial signs of execution on EBIT margin improvement can be seen.

Tech Mahindra Ltd.'s share price rose over 4% on Tuesday after CLSA upgraded its rating to 'outperform' from 'hold', noting initial signs of execution on operating profit margin expansion. The brokerage also hiked the target price to Rs 1,749 per share from Rs 1,625.78 apiece, implying a 9.8% upside from Monday's closing price.

CLSA bumped up its target price on the IT firm to Rs 1,749 per share, higher from its earlier target of Rs 1,626.

Tech Mahindra is a largecap IT stock. The IT stock jumped more than 4 per cent after brokerage CLSA upgraded its rating to OUTPERFORM from HOLD. Tech Mahindra is the 5th largest IT company in the country.

In its note, CLSA mentioned that Tech Mahindra is already seeing an expansion in its EBIT margin, with the next key milestone being the order book.