A Tata Group stock surged 10 percent after management signaled growth could return from Q1FY26, driven by large deal wins in key sectors. However, analysts remain cautious due to weak Q4 results, flat revenue, and ongoing challenges in core business segments.
Stock Price Movement
With a market capitalization of Rs. 33,208.96 crores, the share of Tata Elxsi Limited has reached an intraday high of Rs. 5,399.05 per equity share, rising nearly 10.19 percent from its previous day’s close price of Rs. 4,899.75. Since then, the stock has retreated and is currently trading at Rs. 5,331.85 per equity share.
What is the reason for the rise?
Tata Elxsi’s stock saw a surge of 10 percent today, with a trading volume of 2.67 million shares, the highest in the last six months. The rise could be attributed to the company’s expectation of growth returning from Q1FY26, with better performance in FY26 compared to FY25. The revenue increase is expected from large deal wins, including a $100 million deal in media and communications and a €50 million deal in the transportation sector.
Bullish Divergence RSI (Regular):
Recent Quarter Results Walkthrough
Despite the positive expectations, Tata Elxsi has reported flat revenue growth of 0.22 percent YOY, from Rs. 906 crore in Q4 FY24 to Rs. 908 crore in Q4 FY25, and its net profit dropped by 12.69 percent from Rs. 197 crore in Q4 FY24 to Rs. 172 crore in Q4 FY25. This indicates that the company’s performance remains under pressure, even with the large deals and anticipated growth in the upcoming quarters.
Also read: IT stock jumps 8% after receiving ₹138 Cr digital solutions contract from LIC
Analysts’ Views and Revised Target Price
Analysts are cautious about Tata Elxsi’s future, with Morgan Stanley maintaining an ‘Underweight’ rating and reducing the price target to Rs. 4,660. They pointed to a Q4 miss despite low expectations and noted that macroeconomic conditions are challenging.
JPMorgan also maintained its ‘Underweight’ rating, cutting its price target to Rs. 4,400 due to continued revenue and margin misses, particularly in the automotive and media segments. However, both brokerages acknowledged potential growth from recent large deal wins.
Strategic Expansion
Tata Elxsi is making a big entry into aerospace and defense with exciting projects. They’ve partnered with Hindustan Aeronautics Limited (HAL) for the Tejas aircraft and signed deals for advanced UAV designs with Garuda Aerospace and CSIR-NAL.
Tata Elxsi is also working on new technologies like eVTOLs, unmanned vehicles, and digital twins with Calexce. Recently, they showcased their innovations at Aero India 2025 in Bengaluru, aiming to lead in this field.
Company Overview
Tata Elxsi Limited was established in 1989 and is a design and technology services company. It is engaged in product engineering, embedded systems, and digital solutions across automotive, broadcast, communications, healthcare, and transportation industries globally.
Written By – Nikhil Naik
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