Fri Jan 10 19:54:12 UTC 2025: ## Tata Elxsi Stock Plunges 8% After Disappointing Q3 Results
**Mumbai, January 10** – Shares of Tata Elxsi plummeted 8 percent on Friday, hitting a 52-week low of ₹5,924, after the company reported weaker-than-expected third-quarter (Q3FY25) results. The drop leaves the stock nearly 35 percent below its August 2024 high of ₹9,082.90.
The IT services provider saw a 3.5 percent decline in net profit to ₹199 crore compared to ₹206.43 crore in the same period last year. While revenue from core operations increased 3 percent to ₹939.17 crore, total expenses surged 7 percent year-on-year, driven by higher employee benefits and material costs.
Despite the setbacks, CEO and Managing Director Manoj Raghavan expressed confidence, highlighting strong growth in India (21.9 percent YoY) and emerging markets (66.8 percent YoY), particularly Japan. He cited these regions as key drivers for future growth, despite ongoing geopolitical uncertainties and challenges in Europe and the US.
However, the results disappointed analysts. Morgan Stanley downgraded Tata Elxsi to “underweight,” lowering its target price from ₹6,500 to ₹6,000, citing weaker-than-expected Q3 performance and challenges in the European transportation, media, and healthcare sectors. The firm also noted limited growth visibility and high valuations. Segmental performance showed mixed results, with development and services revenue up 3.3 percent YoY, but system integration and support services down 18.2 percent YoY.
Tata Elxsi’s ability to navigate current market headwinds and capitalize on growth opportunities in key regions will be critical to its future performance.
First Piper 