Results     10-Jan-25
Analysis
Tata Elxsi
Revenue up 2.7% YoY to Rs 939.17 crore in Q3FY2025
On standalone basis

Quarter ended December 2024 compared with Quarter ended September 2024.

Net sales (including other operating income) of Tata Elxsi has declined 1.67% to Rs 939.17 crore.  

Operating profit margin has declined from 27.89% to 26.26%, leading to 7.43% decline in operating profit to Rs 246.62 crore.  Purchase of finished goods cost fell from 6.20% to 5.96%.   Employee cost increased from 53.93% to 54.86%.   Other expenses rose from 11.98% to 12.91%.   

Other income fell 38.02% to Rs 39.85 crore.  PBIDT fell 13.38% to Rs 286.47 crore.  Provision for interest fell 4.12% to Rs 4.65 crore.  

PBIDT fell 13.38% to Rs 286.47 crore.  Provision for depreciation down 4.35% to Rs 25.97 crore.  

Profit before tax down 14.35% to Rs 255.85 crore.  Provision for tax was expense of Rs 56.84 crore, compared to Rs 69.28 crore.  Effective tax rate was 22.22% compared to 23.19%.

Profit after tax fell 13.26% to Rs 199.01 crore.  

Promoters’ stake was 43.91% as of 31 December 2024 ,compared to 43.91% as of 30 September 2024 .  

  

Quarter ended December 2024 compared with Quarter ended December 2023.

Net sales (including other operating income) of Tata Elxsi has increased 2.73% to Rs 939.17 crore.  Sales of System Integration & Support Serv segment has gone down 18.23% to Rs 20.50 crore (accounting for 2.18% of total sales).  Sales of Software Development & Services segment has gone up 3.32% to Rs 918.68 crore (accounting for 97.82% of total sales).  

Profit before interest, tax and other unallocable items (PBIT) has slumped 5.84% to Rs 322.99 crore.  PBIT of System Integration & Support Serv segment fell 3.93% to Rs 3.52 crore (accounting for 1.09% of total PBIT).  PBIT of Software Development & Services segment fell 5.86% to Rs 319.47 crore (accounting for 98.91% of total PBIT).  

PBIT margin of System Integration & Support Serv segment rose from 14.62% to 17.18%.  PBIT margin of Software Development & Services segment fell from 38.17% to 34.77%.  Overall PBIT margin fell from 37.52% to 34.39%.  

Operating profit margin has declined from 29.55% to 26.26%, leading to 8.71% decline in operating profit to Rs 246.62 crore.  Purchase of finished goods cost rose from 4.85% to 5.96%.   Employee cost increased from 54.24% to 54.86%.   Other expenses rose from 11.36% to 12.91%.   

Other income up 14.09% to Rs 39.85 crore.  PBIDT fell 6.10% to Rs 286.47 crore.  Provision for interest fell 16.22% to Rs 4.65 crore.  

PBDT fell 5.91% to Rs 281.82 crore.  Provision for depreciation rose 2.04% to Rs 25.97 crore.  

Profit before tax down 6.65% to Rs 255.85 crore.  Provision for tax was expense of Rs 56.84 crore, compared to Rs 67.64 crore.  Effective tax rate was 22.22% compared to 24.68%.

Profit after tax fell 3.59% to Rs 199.01 crore.  

Promoters’ stake was 43.91% as of 31 December 2024 ,compared to 43.92% as of 31 December 2023 .  

For year-to-date (YTD) results analysis

Net sales (including other operating income) of Tata Elxsi has increased 6.59% to Rs 2,820.71 crore.  Sales of System Integration & Support Serv segment has gone up 3,824.13% to Rs 2,745.84 crore (accounting for 97.35% of total sales).  Sales of Software Development & Services segment has gone down 97.09% to Rs 74.87 crore (accounting for 2.65% of total sales).  

Profit before interest, tax and other unallocable items (PBIT) has jumped 3.17% to Rs 1,010.51 crore.  PBIT of System Integration & Support Serv segment rose 17.66% to Rs 13.79 crore (accounting for 1.36% of total PBIT).  PBIT of Software Development & Services segment rose 2.99% to Rs 996.71 crore (accounting for 98.64% of total PBIT).  

PBIT margin of System Integration & Support Serv segment fell from 16.75% to 0.50%.  PBIT margin of Software Development & Services segment rose from 37.56% to 1,331.23%.  Overall PBIT margin fell from 37.01% to 35.82%.  

Operating profit margin has declined from 29.67% to 27.13%, leading to 2.53% decline in operating profit to Rs 765.29 crore.  Purchase of finished goods cost rose from 5.75% to 5.83%.   Employee cost increased from 53.50% to 54.22%.   Other expenses rose from 11.07% to 12.80%.   

Other income up 54.34% to Rs 136.24 crore.  PBIDT rose 3.22% to Rs 901.53 crore.  Provision for interest fell 5.89% to Rs 14.39 crore.  

PBDT rose 3.38% to Rs 887.14 crore.  Provision for depreciation rose 11.56% to Rs 80.18 crore.  

Profit before tax grew 2.63% to Rs 806.96 crore.  Provision for tax was expense of Rs 194.44 crore, compared to Rs 190.96 crore.  Effective tax rate was 24.10% compared to 24.29%.

Profit after tax rose 2.89% to Rs 612.52 crore.  

Promoters’ stake was 43.91% as of 31 December 2024 ,compared to 43.92% as of 31 December 2023 .  


Full year results analysis

Net sales (including other operating income) of Tata Elxsi has increased 12.96% to Rs 3,552.15 crore.  Sales of System Integration & Support Serv segment has gone up 21.72% to Rs 95.89 crore (accounting for 2.70% of total sales).  Sales of Software Development & Services segment has gone up 12.73% to Rs 3,456.26 crore (accounting for 97.30% of total sales).  

Profit before interest, tax and other unallocable items (PBIT) has jumped 21.61% to Rs 1,301.86 crore.  PBIT of System Integration & Support Serv segment rose 543.48% to Rs 24.52 crore (accounting for 1.88% of total PBIT).  PBIT of Software Development & Services segment rose 19.75% to Rs 1,277.34 crore (accounting for 98.12% of total PBIT).  

PBIT margin of System Integration & Support Serv segment rose from 4.84% to 25.57%.  PBIT margin of Software Development & Services segment rose from 34.79% to 36.96%.  Overall PBIT margin rose from 34.04% to 36.65%.  

Operating profit margin has declined from 30.57% to 29.46%, leading to 8.86% rise in operating profit to Rs 1,046.44 crore.  Purchase of finished goods cost fell from 5.92% to 5.46%.   Employee cost increased from 50.81% to 53.75%.   Other expenses fell from 12.70% to 11.34%.   

Other income up 65.22% to Rs 121.95 crore.  PBIDT rose 12.88% to Rs 1168.39 crore.  Provision for interest up 25.06% to Rs 20.26 crore.  Loan funds rose to Rs 223.98 crore as of 31 March 2024 from Rs 182.26 crore as of 31 March 2023.  Inventories rose to Rs 1.11 crore as of 31 March 2024 from Rs 0.39 crore as of 31 March 2023.  Sundry debtors were lower at Rs 971.59 crore as of 31 March 2024 compared to Rs 976.38 crore as of 31 March 2023.  Cash and bank balance rose to Rs 1,357.10 crore as of 31 March 2024 from Rs 1,191.55 crore as of 31 March 2023.  

PBDT rose 12.68% to Rs 1148.13 crore.  Provision for depreciation rose 22.19% to Rs 99.45 crore.  Fixed assets increased to Rs 384.69 crore as of 31 March 2024 from Rs 324.37 crore as of 31 March 2023.  Intangible assets declined from Rs 16.20 crore to Rs 13.44 crore.  

Profit before tax grew 11.86% to Rs 1,048.68 crore.  Provision for tax was expense of Rs 256.44 crore, compared to Rs 182.31 crore.  Effective tax rate was 24.45% compared to 19.45%.

Profit after tax rose 4.91% to Rs 792.24 crore.  

Promoters’ stake was 43.92% as of 31 March 2024 ,compared to 43.92% as of 31 March 2023 .  

Cash flow from operating activities increased to Rs 701.23 crore for year ended March 2024 from Rs 486.86 crore for year ended March 2023.  Cash flow used in acquiring fixed assets during the year ended March 2024 stood at Rs 83.11 crore, compared to Rs 64.10 crore during the year ended March 2023.  

 

Management commentary:

Mr. Manoj Raghavan, CEO and Managing Director, Tata Elxsi, commenting on the company’s performance said “We are happy to report a steady quarter with revenue from operations at Rs. 939.2 crores. During the quarter, EBITDA margins stood at 26.3% and the PBT margin was reported at 26.1%.

We continue to see positive outcomes of our strategic business focus on Japan, emerging markets and capitalising on the India opportunity. During the quarter, our revenue from India has grown by 21.9% YoY, while Japan and emerging markets grew at 66.8% YoY. This will serve us well over the next few quarters even as we navigate geopolitical uncertainty, currency volatility and industry specific challenges in Europe and US.

The automotive industry has seen significant business challenges in the past few months, with OEMs especially in the US and Europe reporting sales and growth challenges in their major markets. This has impacted new deal closures, and Tier 1 supplier spend.

Amidst this business environment, Tata Elxsi continues to do well to win and execute on the large deals won over this year and demonstrate differentiated value to customers, to protect and grow revenues in a difficult quarter for the entire automotive industry.

 

During the quarter, we announced an Offshore Development Centre for Suzuki Corporation, Japan to support their global technology, software and engineering development. Suzuki’s Chief Technology Officer, Katsuhiro Kato highlighted the importance of the centre as a strategic and core component of Suzuki’s innovation strategy, helping it accelerate software and virtual development across Connected, Autonomous and Electric technologies.

We are delighted to be launching our AVENIR SDV software suite at the CES 2025 Conference in Las Vegas, the premier global showcase for technology innovation. AVENIR encompasses a cloud-native virtual development platform and a hybrid global validation platform, and is powered by the Snapdragon Digital Chassis platform, in partnership with Qualcomm. We offer a compelling proposition of a ready-to-adopt solution, coupled with deep digital and software expertise and scaled talent base, to help global OEMs shift-left and accelerate their SDV and future mobility roadmaps.

Our Media & Communication business reported QoQ CC growth in a quarter that is typically soft and affected by furloughs. We are positioned well to help customers in the media, entertainment and telecom industry on all three levers of growth, efficiency, and innovation.

We won a large multi-year deal with a US headquartered MSO to develop and manage their portfolio of applications and expect to ramp this up over the next few quarters. We are positioned well in some very large deals across the world, with decisions and outcomes expected in the coming quarter and beyond.

Our Healthcare & Lifesciences business reported growth of 1.1% QoQ. We continue to win new marquee healthcare customers, and our Gen AI powered regulatory, digital engineering and sustainability offerings are seeing significant traction in the market.

Our Systems Integration (SIS) business witnessed decision delays in some large projects that had a significant impact on revenues in the quarter. While we are aiming to win and execute them over this quarter and beyond, we continue to work on pivoting the business away from project-based to annuity and service based revenue streams.

We step into the fourth quarter of this financial year with the confidence of large automotive deal wins in the year and quarter that will see continued ramp-ups even as we navigate the current volatility in the automotive market; the stability and return to growth in our healthcare and media & communications verticals, and large strategic deals in the pipeline across all our key verticals”.

Tata Elxsi : Standalone Results
Quarter endedYear to DateYear ended
Particulars202412202312Var.(%)202412202312Var.(%)202403202303Var.(%)
Net Sales (including other operating income)939.17914.232.732,820.712,646.206.593,552.153,144.7212.96
OPM (%)26.2629.55-329 bps27.1329.67-254 bps29.4630.57-111 bps
OP246.62270.14-8.71765.29785.15-2.531,046.44961.288.86
Other Inc.39.8534.9314.09136.2488.2754.34121.9573.8165.22
PBIDT286.47305.07-6.10901.53873.423.221,168.391,035.0912.88
Interest4.655.55-16.2214.3915.29-5.8920.2616.225.06
PBDT281.82299.52-5.91887.14858.133.381,148.131,018.8912.68
Depreciation25.9725.452.0480.1871.8711.5699.4581.3922.19
PBT255.85274.07-6.65806.96786.262.631048.68937.511.86
PBT before EO255.85274.07-6.65806.96786.262.631048.68937.511.86
EO Income00-00-00-
PBT after EO255.85274.07-6.65806.96786.262.631048.68937.511.86
Taxation56.8467.64-15.97194.44190.961.82256.44182.3140.66
PAT199.01206.43-3.59612.52595.32.89792.24755.194.91
P/(L) from discontinued operations net of tax00-00-00-
Net profit after discontinued operations199.01206.43-3.59612.52595.32.89792.24755.194.91
EPS (Rs)*31.9533.14-3.5998.3495.582.89127.20121.254.91
* EPS is on current equity of Rs 62.28 crore, Face value of Rs 10, Excluding extraordinary items.
# EPS is not annualised
bps : Basis points
EO : Extraordinary items
Figures in Rs crore
Source: Capitaline Corporate Database


Tata Elxsi : Standalone Segment Results
td>-
 Quarter endedYear to DateYear ended
% of (Total)202412202312Var.(%)% of (Total)202412202312Var.(%)% of (Total)202403202303Var.(%)
Sales
System Integration & Support Serv2.1820.5025.07-18.2397.352,745.8469.973,824.132.7095.8978.7821.72
Software Development & Services97.82918.68889.173.322.6574.872,576.23-97.0997.303,456.263,065.9512.73
Total Reported Sales100.00939.17914.232.73100.002,820.712,646.206.59100.003,552.153,144.7212.96
Less: Inter segment revenues 0.000.00- 0.000.00 0.000.00-
Net Sales100.00939.17914.232.73100.002,820.712,646.206.59100.003,552.153,144.7212.96
PBIT
System Integration & Support Serv1.093.523.66-3.931.3613.7911.7217.661.8824.523.81543.48
Software Development & Services98.91319.47339.37-5.8698.64996.71967.732.9998.121,277.341,066.7019.75
Total PBIT100.00322.99343.03-5.84100.001,010.51979.453.17100.001,301.861,070.5121.61
Less : Interest4.655.55-16.2514.3915.29-5.8720.2616.2025.08
Add: Other un-allcoable-62.49-63.411.45-189.16-177.90-6.33-232.92-116.81-99.40
PBIT Margin(%)
System Integration & Support Serv 17.1814.62255.72 0.5016.75-1,625.04 25.574.842,073.55
Software Development & Services 34.7738.17-339.23 1,331.2337.56129,366.60 36.9634.79216.54
PBT100.00255.85274.07-6.65100.00806.96786.272.63100.001,048.68937.5011.86


Peer Comparision (Standalone) Q-202412
Sales
(Rs. Crs)
var.(%) OP
(Rs. Crs)
var.(%) Net Profit
(Rs. Crs)
var.(%) Share Price(Rs)
09-Jan-2025
var.(%)
over
One year
TTM EPS TTM PE
Tata Elxsi Ltd 939.17 2.73 246.62 -8.71 199.01 -3.59 6,443.70 -25.38 129.96 49.58
Industry 939.17 2.73 246.62 -8.71 199.01 -3.59 42,315.30 -22.41 69.44
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