Tata Tech Surges 4% After Q1 Earnings And Optimistic Outlook; Should You Invest?
Shares of Tata Technologies rose over 4% on Tuesday following upbeat commentary from the management despite a soft June quarter performance
Tata Technologies Share Price: Shares of Tata Technologies rose over 4% on Tuesday following upbeat commentary from the management despite a soft June quarter performance. The stock climbed 3.52% to hit a high of Rs 742 on the BSE, buoyed by the company's positive tone around future growth prospects.
The engineering services company reported a 7.6% quarter-on-quarter (QoQ) decline in constant currency (CC) revenue from its core services business, citing delays in ramp-ups and paused R&D investments by original equipment manufacturers (OEMs) due to tariff-related pressures. However, the management remains confident of a recovery beginning in Q2, backed by a strong order book at the end of the first quarter.
Brokerages, however, remain divided. ICICI Securities noted that the company's optimistic outlook has yet to reflect in the numbers and termed the management's FY26 double-digit growth target as ambitious. It expects a 1.5% YoY dip in FY26 dollar revenue and sees maintaining FY26 EBIT margins as a 'tall order." The brokerage retained a 'Sell' rating, valuing the stock at 25x on Q3FY27E to Q2FY28E EPS of Rs 20, with a target price of Rs 510.
JM Financial was more constructive, highlighting improved deal wins—six large deals in Q1, the highest in six quarters—as a key confidence driver. It stated that the current OEM project delays appear tactical and temporary, noting there have been no cancellations so far. Despite trimming FY26-28 EPS estimates by 1–3% due to margin revisions, it maintained a 'Buy' rating with an upgraded target of Rs 790 (from Rs 780).
On the other hand, PL Capital also maintained a 'Sell' call, projecting a 3% and 1.2% decline in FY26 revenue for the services and consolidated business, respectively, followed by an 11.5% rebound in FY27. It values the stock at 28x FY27E EPS, arriving at a price target of Rs 570.
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