Tata Elxsi reports 2.5% decline in net profit, revenue grows 2.4% on CC basis in Q1

Bengaluru, 11 July: Engineering services firm, Tata Elxsi reported a 2.5 per cent decline in its net profit at Rs 184.1 crore year-on-year basis for the first quarter ended June 2024.

Revenue for first quarter grew 9 per cent to Rs 926.5 crore as compared to Rs 850.3 crore reported a year ago. In constant currency terms, revenue grew 2.4 per cent over the previous quarter.

The Bengaluru-headquartered firm’s profit was impacted by weaker growth in its healthcare and life sciences segment, which saw a decline in growth by 4.3 per cent on sequential basis. Similarly, its media and communications vertical also witnessed only marginal growth of 0.5 per cent on sequential basis.

“We executed very well on operational excellence and fiscal discipline in this quarter towards bottom-line performance, despite the impact of an exceptional one-off expense in the quarter and an increase in the effective tax rate with the change in SEZ benefits for one of our facilities. Our investments in building the talent pool over the past few quarters provides us with strong levers to power topline growth and manage our bottom line. Coupled with our differentiated offerings, offshore delivery and operational excellence, we are confident of returning to our preferred margin band over the year,” Manoj Raghavan, CEO and Managing Director of Tata Elxsi said.

“Our transportation business reported a strong growth of 5.3 per cent QoQ and 20.3 per cent YoY in constant currency, and now accounts for more than 50 per cent of our software development & services business. We believe we are well positioned to capture growth opportunities in the coming quarters,” he added.

Its operating margin stood at 24.3 per cent during the first quarter, a dip of 1.5 per cent from the previous quarter. Its margin was at 27.1 per cent a year earlier.