News

Tata Technologies shares downgraded by BoFA Sec on limited near-term upsideBoFA Securities believes that the next potential catalyst for the Tata Technologies stock could be improved visibility around a recovery in automotive ER&D spending.By Meghna Sen   July 1, 2025, 2:18:39 PM IST (Published)2 Min ReadShares of Tata Technologies Ltd. were trading lower on Tuesday, July 1, after global brokerage firm BoFA Securities downgraded the stock to 'Neutral', citing an expected 6.5% quarter-on-quarter decline in Q1 revenue due to a pause in ER&D spending.

BoFA mentioned that the current valuation of 36x forward PE (price-to-earnings) appears fair.

"We retain our price objective of ₹730 as we increase our target multiple to 37x (previously 35x)," the brokerage said.

BoFA Securities believes that the next potential catalyst for the stock could be improved visibility around a recovery in automotive ER&D spending. However, they expect this recovery to emerge no sooner than the end of the current fiscal year, and therefore see limited upside for the stock in the near term.

In a recent interaction with CNBC-TV18, Tata Technologies said the company is aiming for double-digit growth this financial year despite a muted first quarter.

Warren Harris, Chief Executive Officer and Managing Director of Tata Technologies said, “Deal signings are very strong, and we are seeing that certainly in automotive. I am going to the Paris Air Show in two weeks time. We expect to be able to announce a couple of deals at the Air Show and so we are still bullish about improvement in Q2 (July-September quarter) and again a very strong second half to this fiscal year.”

The company expects a soft first quarter due to decision-making delays, especially in the automotive segment, which continues to be its largest vertical.

While concerns around rare earth magnet exports have impacted some component makers, Tata Tech’s clients are using the moment to build supply chain resilience, an area where the company sees growing demand.

At present, the Tata Technologies stock is trading 0.16% lower on Tuesday at ₹709.85. The stock is down 20% so far in 2025.Continue ReadingNote To ReadersDisclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!Tagsshare market todayTata Technologies