Why ICICI Securities Sees 23% Upside On Tata Tech

ICICI Securities gave a "buy" call with a target price of ₹1,290, indicating a 23% upside from previous day's closing price for Tata Technologies. 

What The Brokerage Said: The research firm’s call came after the company's recent analyst meet, where Tata Technologies demonstrated its prowess in converting vehicles with internal combustion engines (ICE) to electric vehicles (EV).

It also showcased its capabilities in software-defined vehicles (SDV), smart manufacturing, plant engineering, robotics, AI implementation and battery solutions. 

The brokerage said the company achieved robust skillsets in the EV domain with its projects of converting Tigor and Tiago from ICE to EV for Tata Motors. The company has also put effort into enhancing partnerships with original equipment manufacturers to speed up its transition to its SDV portfolio.

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The company has also added marquee clients such as a joint venture with BMW to set up a centre in India, systems applications and products in data processing (SAP) for Jaguar Land Rover which will limit the downside from Vinfast ramp-down, the brokerage added.

ICICI however said risks for the company include under-penetration in Europe and other verticals being unable to compensate for Vinfast's ramp-down. 

Price Action: Shares of Tata Tech rose 1.61% to ₹1,067.85 on Tuesday. The stock has fallen 18% since its listing in November 2023.

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