Why This Tata Stock Is Tanking Today

Shares of Tata Elxsi were tanking in early trade on Tuesday as the company reported muted numbers for the quarter ended June.

What Happened: The Tata Group Company‘s profit for the June quarter stood at 188.85 crore, up around 2.2% from the ₹184.72 crore profit it booked in the same quarter last year. The company’s revenue from operations went up 17% to ₹850.27 crore as compared to ₹725.89 crore revenue it booked in the year-ago period. Both the topline and bottom line were slightly lower than consensus estimates.

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The company’s EBITDA came in at ₹251.46 crore, with an EBITDA margin of 29.6%. Earnings per share for the quarter stood at ₹30.32.

Reacting to the results research firm Morgan Stanley maintained its “underweight” rating for the stock with a price target of ₹5,700. The firm said that the company’s recent rally has made the risk-to-reward ratio unfavourable. Prior to the slump today, the stock had gone up close to 20% since the start of the year.

Price Action: Tata Elxsi’s share price was down 3.22% to trade at ₹7,471.30 as the markets opened on Tuesday.

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