Tata Technologies shares trade in green on 15% rise in Q3 net profit

Tata Technologies shares gained 1.6 percent in early trade on January 19 after the global engineering services company registered a 14.7 percent on-year growth in consolidated profit at Rs 170.22 crore for the quarter ended December 2023.

Revenue from operations also grew by 14.7 percent to Rs 1,289.5 crore compared to the year-ago period.

As of 9.45am, shares of the company were trading at Rs 1,145.95 on the NSE, higher by 0.12 percent from the previous session’s closing price.

In US dollar terms, total operating revenues increased 13.4 percent on-year to $154.8 million. The services segment revenues were up 8.3 percent YoY at $120.2 million, and the same in constant currency grew 5.8 percent YoY.

In a note, JM Financial, a brokerage, said that strong demand from anchor clients (such as Tata Motors and JLR) and other EV programmes are helping the company. For the quarter, Tata Tech saw 5 large deal wins, including a $50-million-plus deal and a $25-million deal, lending further visibility. The brokerage reiterated its buy call, with a target price of Rs 1,370 per share.

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The company’s management also indicated that aerospace, led by Airbus, should provide further impetus to FY25 growth. Despite near-term headwinds due to ramp-down in the Vinfast project, the management remains confident of strong growth in FY25. The company is aiming for a 200-250 bps margin expansion for the upcoming quarter.

Since its listing on November 30 at Rs 1,200, shares of Tata Tech have fallen around 12.5 percent. The stock listed 140 percent over the issue price of Rs 500 per share.

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