Earnings downgrade cycle continues

Research evidence excerpt

Earnings downgrade cycle continues

Idea

July 15, 2026 03:09 AM GMT

Morgan Stanley India Company Private Limited+MTata Elxsi Ltd | Asia Pacific Sulabh Govila, CFA

Equity Analyst

Earnings downgrade cycle Sulabh.Govila@morganstanley.comGaurav Rateria +91 22 6118-2249

Gaurav.Rateria@morganstanley.com +91 22 6118-2237

continues Shreshtha Chopra

Research Associate

What’s Changed Shreshtha.Chopra@morganstanley.com +91 22 6118-2227

Sakshi Rana

Tata Elxsi Ltd (TTEX.NS) From To Research Associate

Price Target Rs3,780.00 Rs3,400.00 Sakshi.Rana@morganstanley.com +91 22 6118-1002

Reaction to earnings

Strengthens our thesis Meaningful shortfall Meaningful revision lower

Impact to our thesis Financial results versus consensus Direction of next 12-month

consensus EPS

Source: Company data, Morgan Stanley Research Tata Elxsi Ltd (TTEX.NS, TELX IS)

India Technology | India

Key takeaways: a) negative surprise in margins, b) curtailment of Stock Rating Underweight

R&D spend in favor of AI spending. Industry View In-Line

Price target Rs3,400.00

Up/downside to price target (%) (8)

Key Takeaways Shr52-Weekprice,Rangeclose (Jul 14, 2026) Rs6,439.50-3,562.00Rs3,697.30

Sh out, dil, curr (mn) 62

1Q margins surprised negatively, driven by investments in the business. Mkt cap, curr (mn) Rs230,243

EV, curr (mn) Rs214,972

Management continues to aim for a high-single-digit revenue growth trajectory Avg daily trading value (mn) Rs1,444

for F27, even though it would require Healthcare to return to growth trends. Fiscal Year Ending 03/26 03/27e 03/28e 03/29e

EPS (Rs)** 112.15 116.52 130.90 144.94

Growth aspirations intact, but requires Healthcare to return to growth trends: Prior EPS (Rs)** - 127.64 140.77 154.19

EPS (Rs)§ 102.63 133.52 152.00 168.93