Bullish indicating open at $55-$60, IPO prices at $37
Investing.com - Axis Capital (NYSE:AXS) Limited has downgraded Tata Elxsi Ltd (NS:TELX) from Reduce to Sell, while raising its price target to INR5,120.00 from INR4,900.00.
The downgrade comes despite the stock’s approximately 19% price increase over the past three months, which has pushed valuations back to average multiples even as the company faces continued financial challenges.
According to Axis Capital’s analysis of Tata Elxsi’s FY25 annual report, the company showed weak performance outside of its Jaguar Land Rover (JLR) business, with revenue declining in non-JLR segments while JLR itself likely weakened through the latter part of FY25.
The report highlights that Tata Elxsi’s margins have declined sharply from FY22 through FY25, though the company hopes to reverse this trend through the ramp-up of previously won deals in FY26.
Tata Elxsi has emphasized efforts to diversify revenue across verticals, including shifting away from tier-1 suppliers to OEMs in the automotive sector, adding new clients in healthcare, and planning to open new verticals such as aerospace and defense.
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