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Published: Feb 1, 2023
Updated: Feb 1, 2023

Tata Elxsi Q3 Earnings Report: Strong Results Despite Weak Market Conditions

Despite weak market conditions, Tata Elxsi's share price edged higher during early trade on January 27. The company reported its Q3 earnings for Oct-Dec, with net profit coming in at Rs 194.68 crore, up 28.97 percent from Rs 150.95 crore in December 2021. EBITDA also saw an increase of 22.38 percent, coming in at Rs 265.99 crore for the given quarter.

Results strong

The company also reported EPS of Rs 31.26 for the period ended December 31, 2022, compared to Rs 27.98 for the period ended September 30, 2022. Total income for the period ended December 31, 2022 was reported at Rs 836.87 crore, compared to Rs 641.9244 crore for the same period in 2021.

Morgan Stanley still expects a 14% correction

Despite these strong results, global research and broking firm Morgan Stanley has an underweight rating on the stock, with a target of Rs 5,800 per share, a downside of 14 percent from the current market price. The firm cites a slowdown in the company's Embedded Product Design (EPD) business, due to furloughs and project deferments, as well as normalization of costs and expenses related to employee stock options, as reasons for their rating.

Overall outlook positive

Tata Elxsi's Q3 Earnings Show Positive Growth, Despite Weak Market Conditions Despite a slowdown in its Embedded Product Design (EPD) business, Tata Elxsi's Q3 earnings showed positive growth, with net profit and EBITDA both increasing. While global research firm Morgan Stanley has an underweight rating on the stock, the company's strong results and positive outlook should be taken into consideration.