Tata Elxsi shares jump 3% after Q2 PAT rises 14% YoY to Rs 229 crore

Tata Elxsi shares rose 2.8% on Friday to day’s high of Rs 7,980.30 on BSE after the company reported a 14% growth in its consolidated net profit, reaching Rs 229 crore for the second quarter, compared with Rs 200 crore in the same quarter last year.

Its revenue from operations during the same period increased 8% year-on-year to Rs 955 crore, up from Rs 882 crore in the same quarter last year.

On a sequential basis, profit rose by 27%, while revenues were up 3% quarter-on-quarter.

The company’s operational efficiency, offshore delivery, fiscal discipline, and differentiated offerings have contributed to its EBITDA margins expanding by 70 basis points to 27.9% for the quarter.

“Our strategic focus on expanding our business in Japan, emerging markets, and capitalising on the India opportunity, is now starting to significantly contribute to our growth,” said Manoj Raghavan, CEO and Managing Director, Tata Elxsi.

During the quarter, revenue from the India business rose by 31% year-on-year, while Japan and emerging markets experienced significant growth at 82% year-on-year.The transportation business continues to drive growth for the company, registering strong revenue growth of 8.8% quarter-on-quarter.”Our deep and scaled ADAS, Connected, Electric, and Software Defined Vehicle (SDV) capabilities are helping us win large deals with global OEMs across the world, positioning us well for the continued transformation of the automotive industry,” Raghavan said.

The company won a landmark $50 million multi-year deal from a global OEM headquartered in Europe, which encompasses SDV and multiple domains of automotive engineering. This strategic engagement will enable SDV platform development and the next generation of mobility for this world-leading brand.

During the quarter, Tata Elxsi also announced a strategic engagement with Nidec Corporation in Japan to support their group technology initiatives, particularly for the automotive market.

The media and communication business declined marginally by 1% quarter-on-quarter, although the company noted that it sees green shoots for growth, driven by its network transformation offerings and Gen AI-led innovation for the future of media.

The healthcare and life sciences business reported a 10% decline in topline quarter-on-quarter, attributed to delays in the renewal and start of some new programs with a leading U.S.-based customer.