Tata Elxsi Q3 FY2025: Weak Results Prompt Kotak to Maintain ‘Sell’ Rating

Vijay Singh
2 Min Read

Tata Elxsi, a leading design and technology services provider for automotive, media, and healthcare sectors, reported disappointing Q3 FY2025 results, leading Kotak Institutional Equities to maintain a SELL rating. The brokerage firm has also slashed the target price for Tata Elxsi shares by ₹200, bringing it down to ₹5,400 from ₹5,600, citing a weak performance and challenging market conditions.

Key Highlights of Tata Elxsi’s Q3 FY2025 Performance

  • Net Profit: ₹199 crore, down 3% from ₹206 crore in Q3 FY2024.
  • Revenue from Operations: ₹939 crore, compared to ₹914 crore in the same quarter last year.

Sectoral Performance Insights

  • The healthcare vertical showed a modest uptick.
  • The transportation and media verticals were muted, reflecting subdued demand across key segments.
  • Automotive vertical: Facing significant headwinds due to weak demand from European and U.S. automotive clients, leading to near-term uncertainties.

Impact on Earnings Estimates

Kotak Institutional Equities has reduced Tata Elxsi’s FY2025-27E EPS estimates by 7-11%, driven by persistent challenges in the automotive segment. Despite some green shoots in other businesses, the near-term outlook for the company remains under pressure.

Stock Performance

  • Current Price: ₹6,000.6 (-6.82%).
  • 52-Week Range: ₹5,921 (low) to ₹9,080 (high).
  • Tata Elxsi’s stock has corrected by 31% over the past year, reflecting investor concerns over growth aspirations.

About Tata Elxsi

Founded in 1989, Tata Elxsi provides innovative design and technology solutions globally. It is a key constituent of the NIFTY MIDCAP 100 index, but ongoing market challenges in the automotive sector have impacted its overall performance.

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