Tata Elxsi' stock price plummets

18 Oct 2022 , 02:41 PM

In an otherwise lackluster market, shares of Tata Elxsi fell 6% on the BSE on Tuesday and reached a three-month low of Rs7,280. Following news that the Tata Group company’s sales growth for the July-September quarter was sluggish, the stock has dropped 14% in the last two trading days (Q2FY23).

With the fall over the last two days, Tata Elxsi’s market price has corrected 32% from its all-time high of Rs10,760, which it reached on August 17, 2022. Since June 21, 2022, it was trading at its lowest point. At 12:15 PM, the S&P BSE Senses was up 1.1% in contrast. In just two days, the index had risen 2%

Tata Elxsi reported revenue from operations of Rs763 crore for Q2FY23, up 5.1% quarter over quarter and 28.2% year over year (YoY). Net profit was Rs174.3 crore, down 5.7% QoQ but up 39.1% YoY, while EBITDA margin decreased by 312 basis points QoQ to 29.7%.

The company is increasing market share in both the automotive and media & communications industries, particularly in Europe, according to the management. Because of the region’s unfavorable currency movement, the numbers are muffled. Management did note some postponement and delay in Media and Communication, though. It anticipates this to last for one or more quarters because of consumers’ caution, which is primarily present in the US and Europe due to the inflationary environment. The macro climate, according to management, is making it harder to close deals in the US and Europe.

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