Tata Elxsi shares slide 6% after weak Q1 results. Why Motilal Oswal sees 16% downside from current levels?

Tata Elxsi shares fell 6% after its June quarter results disappointed on margins, with EBIT margin contracting to 19% versus expectations of 21.5%, even as PBT rose 18.4% year-on-year to Rs 232.5 crore and EBITDA grew 15.7% to Rs 216 crore. Motilal Oswal maintained a Sell rating with a target price of Rs 3,100, implying about 16% downside, citing weakness in the Transportation and Healthcare segments. Choice Institutional Equities downgraded the stock to Sell and cut its target to Rs 3,150 from Rs 3,650, trimming FY27 and FY28 earnings estimates by 2.7% and 6.0% respectively.