Capital budgeting decisions play a crucial role in determining the long-term growth, profitability, and financial stability of organizations. This study examines the impact of capital budgeting decisions on the financial performance of Tech Mahindra. The research is based on secondary data collected from the annual reports and financial statements of Tech Mahindra for the period 2021–2025. Various capital budgeting techniques, including Net Present Value (NPV), Internal Rate of Return (IRR), and Payback Period, are utilized to evaluate investment decisions. In addition, financial performance is assessed using key financial ratios such as Return on Assets (ROA), Return on Equity (ROE), Current Ratio, and Quick Ratio. Statistical tools such as correlation and regression analysis are employed to examine the relationship between capital budgeting decisions and financial performance indicators. The findings of the study indicate that effective capital budgeting decisions contribute significantly to improved financial performance by enhancing profitability, optimizing resource allocation, and supporting sustainable growth. The study concludes that sound investment appraisal practices enable Tech Mahindra to maximize shareholder value and maintain a competitive position in the information technology industry. The research provides useful insights for managers, investors, and policymakers regarding the importance of strategic capital investment decisions in achieving long-term organizational success.