Shares of Tata Technologies started Thursday’s session (June 20) on a muted note. The stock opened flat with a negative bias at Rs 1026.05 as against the previous close of Rs 1026.95 per share on the BSE.

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Global brokerage Goldman Sachs has initiated its coverage on the stock with a ‘sell’ rating and target price of Rs 900. The brokerage believes that base revenue from its key customer VinFast is likely to decline over the near term. Further, as per the brokerage Tata Technologies is highly dependent on its anchor customers in comparison to its peer companies.

Long-term R&D spending in the emerging aerospace segment remained subdued in the past cycles, it added. Further, Goldman Sachs held that moderate growth at the company will help drive stable free cash flow (FCF) growth. Nonetheless, despite all the near-term headwinds, the brokerage sees better entry points ahead in the counter.

After listing in November last year with stellar gains of 140 per cent, the stock is trading 105 per cent higher than in its IPO issue price of Rs 500.

Tata Technologies is the global engineering services company. The company offers product development and digital solutions, including turnkey solutions, to global original equipment manufacturers (OEMs) and their tier one suppliers. Further its segments include services and technology Solutions. The services segment provides outsourced engineering and design services and digital transformation services to global manufacturing clients. The technology Solution segment contains academia upskilling and reskilling solutions and value-added reselling of software applications and solutions.