Tata Elxsi Q2 Results: Net Profit Rises Nearly 25% QoQ, Exceeds Estimate

Design and technology services provider Tata Elxsi Ltd. on Thursday posted a 24.7% sequential jump in net profit to Rs 229.4 crore in the quarter ended September 2024. This exceeds the estimate of Rs 200.85 crore that analysts tracked by Bloomberg had shared.

In the April-June period, Tata Elxsi had posted a net profit of Rs 184 crore.

On a year-on-year basis, the company's net profit rose by 12% as compared to Rs 200 crore in the corresponding quarter of the previous fiscal.

Tata Elxsi's revenue from operations during the quarter under review came in at Rs 955 crore, up 3.1% from Rs 926.4 crore reported in the June quarter.

The revenue from operations, however, missed the estimate of Rs 947.02 crore shared by the analysts tracked by Bloomberg.

• Net profit up 24.7% QoQ at Rs 229.4 (Bloomberg estimate was Rs 200.85 crore).

• Revenue rose 3.1% QoQ to Rs 926.4 crore (Bloomberg estimate was Rs 947.02 crore).

• EBIT increased 5.8% QoQ to Rs 239 crore.

• EBIT margin improved by 60 basis points sequentially to 25%.

The company's earnings before interest and taxes climbed 5.8% to Rs 239 crore, as compared to Rs 226 crore in the April-June period, the financial results showed. The EBIT margin improved by 60 basis points to 25% from 24.4% in the same period.

The results were declared by the company shortly after Tata Consultancy Services Ltd., another arm of the Tata Group, posted its earnings. The IT major's net profit slipped 1.1% to Rs 11,909 crore, and the revenue rose 2.6% to Rs 64,259 crore.

Ahead of the results, shares of Tata Elxsi closed 1.9% higher at Rs 7,759.3 apiece on the NSE, compared to a 0.07% rise in the benchmark Nifty 50.

The stock has declined by 11.3% year-to-date and risen by 5.4% over the past 12 months.

Only two out of the 13 analysts tracking the company have a "buy" rating on the stock; one suggests a "hold,"  and 10 recommend a "sell,"  as per Bloomberg data. The average of 12-month analysts' price targets suggests a potential downside of 14.9%.