Tata Elxsi shares tumble 7% as Q1 income miss; Morgan Stanley, JPMorgan lower targets

Shares of Tata Elxsi plunged as a lot as 7% to ₹5,660 in early commerce on Friday after the corporate posted a pointy decline in its Q1FY26 earnings, triggering considerations over weak demand, margin strain, and extended choice cycles. At 9:30 AM, the inventory was buying and selling at ₹5,880, down 4.4% on the NSE, underperforming a weak broader market.

Tata Elxsi Q1FY26 outcomes: Revenue slips 22%, income down 3.7%

In its June quarter outcomes, Tata Elxsi reported a 22% year-on-year decline in internet revenue at ₹144 crore, in comparison with ₹184 crore in the identical quarter final 12 months. Income dropped 3.7% YoY to ₹892 crore, dragged primarily by weak spot within the automotive and transportation section, which accounts for over 50% of the corporate’s topline. EBITDA fell 26% YoY to ₹187 crore, signalling strain on working margins.

CEO Manoj Raghavan attributed the weak efficiency to “macro and client-specific challenges” that impacted R&D spending and lengthened decision-making cycles. Regardless of the robust quarter, the corporate stays centered on “giant deal execution and long-term buyer relationships,” Raghavan mentioned.

Brokerages preserve bearish stance put up weak outcomes

Following the earnings miss, international brokerages lower estimates and reiterated bearish views. Morgan Stanley maintained its Underweight ranking, setting a revised goal value of ₹4,660, implying a 24% draw back from the final shut. The brokerage famous that the corporate’s efficiency missed expectations regardless of already muted forecasts, and flagged that the inventory has outperformed friends throughout an ongoing earnings downgrade cycle.

JPMorgan additionally retained its Underweight ranking, slashing its goal to ₹3,800. It marked the fourth straight quarter of income and margin miss. The brokerage flagged that whereas auto deal ramp-ups could also be gradual, the telecom section may get better in Q2FY26. JPMorgan lower its FY26–FY28 earnings estimates by 3–5%, citing extended macro uncertainty and US tariff dangers.

Tata Elxsi share value outlook: What traders ought to watch

Shares of Tata Elxsi have now fallen almost 10% year-to-date. With mounting earnings strain, analysts counsel traders intently watch the tempo of restoration in key verticals like automotive and media, execution of enormous offers, and the corporate’s means to stabilise margins. Given a number of earnings misses and cautious commentary from administration, the highway to restoration might take time.