Tata Technologies Ltd.
NSE: TATATECHTata Technologies Ltd.: A 30-second snapshot
Tata Technologies is an engineering R&D services firm trading at ₹620.45, down 5.36% over the past year and 20.9% below its 52-week high, currently below the 200-DMA (₹645.15). At a trailing PE of 46.0x, the stock carries the highest valuation in its IT peer group despite ranking last on ROE (14.6%) and second-last on quality score (42) among the six peers tracked. The forward PE of 27.1x implies a material earnings step-up from the current 8.2% five-year earnings CAGR.
P/E
46.0
Forward P/E
27.1
ROE
+14.6%
Debt / Equity
23.91
Profit Margin
+9.9%
Div. Yield
+1.4%
5Y ROE > 15%
3/5
5Y FCF > 0
4/5
Quality
45/100
News
8 headlines · 5 positive · 0 negative
Tata Tech Q4 Results: Profit up 8%; margins dip on one-offs, dividend declared - CNBC TV18
CNBC TV18
Tata Tech To Reward Shareholders With Two Dividends; Check Record Date, Other Details - NDTV Profit
NDTV Profit
Tata Tech Shares Surged Over 9% After Posting Solid Q4 Results - Republic World
Republic World
Tata Tech rallies 12% after Q4 earnings, Goldman Sachs stays bearish - BusinessLine
BusinessLine
Tata Technologies Q1 Results 2026 - Find Tata Technologies Q1 Earnings Result | TATATECH Q1 results - Mint
Mint
Recent context
- ·Q4 FY26 results showed 8% profit growth; management noted margin pressure from one-off items, with the company declaring two dividends for shareholders (CNBC TV18, May 4, 2026).
- ·The stock rallied 9–12% immediately after Q4 results were published but Goldman Sachs retained a bearish stance post-rally (BusinessLine, May 5, 2026), reflecting divided views on whether the result warranted the price move.
- ·Analyst coverage across 14 analysts shows a mean rating of 3.57 on the 1–5 scale (lower = more constructive), placing consensus in the middle-to-cautious range of the scale.
Strengths
- +Revenue has grown at a 22.3% five-year CAGR, indicating consistent top-line expansion in engineering R&D services — a niche with structural demand from automotive and aerospace clients.
- +FCF has been positive in 4 of 5 measured years, suggesting the business converts revenue to cash in most periods despite the elevated debt-to-equity ratio.
- +Q4 FY26 results showed 8% profit growth and the company declared two dividends, sustaining a 1.35% dividend yield at current price levels.
- +The 50-DMA (₹570.9) is well below the current price (₹620.45) and RSI at 60.1 is in neutral territory, indicating no near-term momentum exhaustion on a short-term basis.
Weaknesses
- −D/E of 23.9 is anomalous for an IT services firm and well above all tracked peers; the debt trend is flagged as rising, compounding the balance-sheet concern.
- −ROE of 14.6% ranks last among six IT peers and has exceeded 15% in only 3 of the past 5 years, pointing to sub-peer capital efficiency that has not improved despite revenue growth.
- −Trailing PE of 46.0x is 2.8x the level of sector bellwether TCS (16.7x) while the quality score (42) and ROE both trail peers — the valuation premium is not supported by superior fundamental metrics.
- −Price is down 5.36% over 12 months and 20.9% below the 52-week high, remaining below the 200-DMA; Goldman Sachs retained a bearish view (per BusinessLine, May 5, 2026) even after the post-results rally.
Open questions
- ?Does the D/E of 23.9 reflect lease capitalization under Ind AS 116, or does it represent financial debt on the balance sheet — and how does interest coverage look under either interpretation?
- ?The forward PE of 27.1x implies a significant earnings acceleration: what specific revenue mix or margin levers does management cite to support that trajectory, given a 5-year earnings CAGR of only 8.2%?
- ?TATATECH ranks last on ROE and PE-relative-to-peers simultaneously — is the valuation premium explained by a specific growth runway (e.g., EV/software-defined-vehicle exposure) that is not captured in trailing metrics?
- ?With price down 5.36% over 12 months while Q4 profit grew 8% and dividends were declared, what is the market pricing in that the recent results did not resolve?
Peer comparison: IT
Ranks 5 of 6 on qualityTechnical state
Current price
₹620.45
SMA 50
₹570.90
SMA 200
₹645.15
RSI (14)
60.1 (neutral)
From 52w high
-20.9%
1Y return
-5.4%
3M return
-1.6%
50-DMA
Above
200-DMA
Below
Algorithmic support levels
Algorithmic resistance levels
Risk flags
- highDebt-to-equity of 23.9 is a significant outlier for an IT services firm; sector peers TCS, Infosys, Wipro, and HCLTech operate near zero net debt. Even accounting for lease capitalization under Ind AS 116, this level warrants examination of interest coverage and whether the balance-sheet trajectory is stable (persistence data shows debt trend: rising).
- mediumROE of 14.6% places TATATECH last (6 of 6) in the IT peer group, well below INFY at 31.4% and TCS at 48.4%; ROE exceeded 15% in only 3 of 5 measured years; quality score of 42 is second-lowest in the peer group behind HCLTECH at 40.
- mediumTrailing PE of 46.0x is the highest in the peer group (ranked 6 of 6), representing a 2.8x premium to TCS (16.7x) and a 3.2x premium to Infosys (14.6x), while ROE and quality scores rank at or near the bottom of the same peer set.
- mediumPrice (₹620.45) has been below the 200-DMA (₹645.15) and is down 5.36% over the past 12 months; drawdown from 52-week high is 20.9%, suggesting sustained underperformance relative to its own recent history.
- lowGoldman Sachs retained a bearish stance on TATATECH after the Q4 post-results 12% rally, per BusinessLine (May 5, 2026); this is a single named-broker view but notable given the price and valuation context.
Cross-section contradictions
- Forward PE compresses from 46.0x to 27.1x, implying a sharp earnings acceleration is priced in; yet 5-year earnings growth has been 8.2% CAGR against 22.3% revenue growth, reflecting a persistent gap between top-line expansion and earnings conversion.
- News sentiment is net positive (5 positive, 0 negative across 8 items) and Q4 profit rose 8% with dividends declared, yet the stock is down 5.36% over 12 months and below its 200-DMA — price action has not reflected the constructive recent newsflow.
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.
Fundamentals & technicals: refreshed 25 Jun 2026 · refreshed daily at 01:00 IST
AI synthesis (narrative, snapshot, strengths/weaknesses, peer ranking): generated 17 May 2026 · rotates through NIFTY 500 every ~5 days