JM Financial maintains Buy on Tata Technologies, target price Rs 850

JM Financial maintains buy call on Tata Technologies with an unchanged target price of Rs 850. The current market price of Tata Technologies is Rs 743.1. The time period given by the analyst is a year when Tata Technologies Ltd. price can reach the defined target. Tata Technologies, incorporated in 1994, is a Small Cap company with a market cap of Rs 29982.96 crore, operating in the IT Software sector.

Tata Technologies’ key products/revenue segments include Software Services, Software Products and Other Operating Revenue for the year ending 31-Mar-2024.

Financials
For the quarter ended 31-03-2025, the company has reported a Consolidated Total Income of Rs 1342.73 crore, down -.17 % from last quarter Total Income of Rs 1345.00 crore and up 1.32 % from last year same quarter Total Income of Rs 1325.19 crore. The company has reported net profit after tax of Rs 185.31 crore in the latest quarter. The company’s top management includes Mr.Ajoyendra Mukherjee, Mr.Warren Kevin Harris, Mr.Pathamadai Balachandran Balaji, Mr.Shailesh Chandra, Mr.Nagaraj Ijari, Ms.Aarthi Sivanandh, Ms.Usha Sangwan. Company has B S R & Co. LLP as its auditors. As on 31-03-2025, the company has a total of 41 crore shares outstanding.

Investment Rationale
Tata Tech?s FY25 annual report offers important data points to dissect its growth. A muted headline growth print (Services: -1% YoY in USD terms) masked an otherwise encouraging underlying trend. Vinfast revenues declined 90%+ YoY during the year (JMFe), implying ex-Vinfast growth of 15% (USD terms). Importantly, this (ex-Vinfast) growth was balanced across Anchor (14%) and non-Anchor (16%) clients. Anchor clients growth, though strong, decelerated from 26% in FY24. Tariff-linked uncertainty towards FY25-end (JLR) and delay in TAMO?s Avinya EV platform might have impacted the growth. These factors, however, appear transitory and should reverse, supporting future growth, in our view. 2x increase in Aerospace helped non-Anchor growth, reflected also in 30% growth in Continental Europe (CE). The company has strengthened leadership in Aerospace vertical with the appointment of Keith Matthews (ex-Belcan) as Head of Aerospace sales. BMW JV recorded Rs 845 million ($10 million) revenues in FY25 (Nov-Mar), with healthy EBITDA margins (20% vs 18% for TATATECH). While a still uncertain environment could weigh on 1H performance, pick-up in Anchor clients, sustained momentum in Aerospace and higher offshoring from European OEMs should aid recovery in 2H. JM Financial retains BUY with an unchanged target price of Rs 850.