Tata Elxsi Reports 14% Dip in Q4 Profit to Rs 172 Crore Due to Industry Challenges

Synopsis

Tata Elxsi has reported a 14% decline in net profit for Q4 FY25, totaling Rs 172 crore, impacted by challenges in the automotive and media sectors. Revenue also fell 3.3% year-on-year. Despite this, the company announced a final dividend of Rs 75 per share and secured significant contracts in healthcare and communications.

Key Takeaways

14% profit decline in Q4 FY25 to Rs 172 crore.
3.3% revenue drop year-on-year to Rs 908.3 crore.
Operating margin narrowed to 22.8%.
Final dividend proposal of Rs 75 per share.
New contracts in healthcare and automotive sectors.

New Delhi, April 17 (NationPress) Tata Elxsi, a technology services firm focused on design, announced a 14% decrease in its net profit for the fourth quarter of the fiscal year 2024-25 (Q4 FY25) on Thursday.

The company recorded a net profit of Rs 172 crore in Q4, a drop from Rs 199 crore during the same quarter last year.

This profit decline was attributed to challenges in critical sectors including automotive and media and communications.

Quarterly revenue also decreased by 3.3% year-on-year (YoY), totaling Rs 908.3 crore, down from Rs 939 crore in the prior year’s corresponding quarter.

The operating margin fell to 22.8%, down from 26.3% the previous year, with earnings before interest, taxes, depreciation, and amortization (EBITDA) dropping 16% to Rs 207.3 crore.

Despite these challenges, Tata Elxsi’s board has proposed a final dividend of Rs 75 per share for the fiscal year, pending shareholder approval.

For the entire fiscal year 2024-25, the company reported a revenue of Rs 3,729 crore and a profit before tax (PBT) margin of 26.3%.

CEO and MD Manoj Raghavan acknowledged the difficulties faced in the quarter, especially in the automotive sector, where new project launches were halted and deal progress was stalled due to geopolitical tensions and market fluctuations.

However, he shared a positive outlook, highlighting a 50 million euros multi-year contract with a European automotive leader, set to commence in the first quarter of FY26.

The media and communications sector also encountered issues due to client mergers and restructuring, yet it secured a significant product engineering contract exceeding 100 million dollars, marking the largest deal in Tata Elxsi’s history.

Additionally, a 10 million dollar agreement was obtained from a global broadcaster.

On a brighter note, the healthcare and life sciences segment experienced a 3.5% quarter-on-quarter (QoQ) growth in constant currency, onboarding new clients and expanding services in digital and innovation.

The Systems Integration and Support division is transitioning towards innovation-driven projects, successfully delivering a notable experiential project in Japan during the quarter.