The shares of leading design and technology service providers dipped by 8 percent after the company’s Q3FY25 disappointing results, also Morgan Stanley reduced its target price to Rs 6000 apiece.
With a market capitalization of Rs 37,319.24 crore, the shares of Tata Elxsi Ltd were trading at Rs 5987.00 per share, decreasing 7 percent as compared to the previous closing price of Rs 6443.70 apiece.
Reason for rise
The shares of the company have seen bearish movement after Tata Elxsi Ltd announced disappointing results in Q3FY25, revenue magnified by 3 percent on a year-on-year basis from Rs 914 crore in Q3FY24 to Rs 939 crore in Q3FY25. However, on a Quarter-on-Quarter basis, revenue fell by 2 percent from Rs 955 crore in Q2FY25 to Rs 939 crore in Q3Y25.
Moreover, net profit fell by 3 percent on a yearly basis from Rs 206 crore in Q3FY24 to Rs 199 crore in Q3FY25, meanwhile, on a quarter-on-quarter basis, net profit also plummeted by 13 percent from Rs 229 crore in Q2FY25 to Rs199 crore in Q3FY25.
Brokerage comment
Additionally, Morgan Stanley, one of the well-known brokerages globally, reduced its target price from Rs 6,500 apiece to Rs 6,000 per share, indicating a potential downside of 6 percent from Thursday’s closing price of Rs 6,443.70 per share.
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Business Segment Performance
The company reported 4.4% growth in Transportation, driven by a $50M European OEM deal and partnerships with Nidec and Emerson. Media and Communication declined 2.2% but saw wins in RDK broadband for Qualcomm and AI initiatives. Healthcare dropped 11.2%, adding key clients and launching robotics innovations with Skanray.
Strategic Focus
The company aims to expand in Japan and emerging markets while exploring new verticals like defense and semiconductors to diversify revenue. Management remains focused on achieving double-digit constant currency growth for FY ’25, despite market challenges, highlighting a strategic push for sustained growth and sectoral diversification.
Company Profile
Tata Elxsi is a significant global provider of design and technology services in industries such as automotive, media, communications, and healthcare. Tata Elxsi offers complete services, including research and strategy, electronics and mechanical design, software development, validation, and deployment.
Written by:- Abhishek Singh
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