Tech Mahindra Ltd shares rose nearly 10% on Monday after the Indian IT services firm named Infosys Ltd veteran Mohit Joshi as its new managing director and chief executive officer.
Joshi has been with rival Infosys for 22 years and is currently the company's president. He will take over the Mahindra Group's IT division on December 20 for a five-year term, the company said in an exchange filing over the weekend.
He will succeed CP Gurnani, whose term is set to expire on December 19.
Joshi's resignation from Infosys is the company's second high-profile departure, following Ravi Kumar's resignation as president in October.
According to a regulatory filing, Joshi will be on leave at Infosys beginning March 11 and will leave the company on June 9.
Tech Mahindra's stock reached its highest level in nearly three years on Monday, and it is the top gainer on the benchmark Nifty IT index, which is up 0.75 percent as of 09:47 a.m. IST.
Tech Mahindra rose 8.2 percent to 1,148.80 rupees, while Infosys fell 1.1% to 1,455.05 rupees.
According to at least three brokerages, it is a positive move for Tech Mahindra.
According to ICICI Securities, Joshi has a strong track record of leading sales, operations, and transformation for Infosys and has held executive responsibility for all significant deals across the company.
The brokerage, however, maintains a "reduce" rating on Tech Mahindra, stating that the company has room to improve its digital capabilities and will need to invest in doing so in order to restart growth.
According to Refinitiv data, the current average rating of 39 analysts covering Tech Mahindra is "buy," with a median price target of 1,143 rupees.