Share Market Reason for the Huge Drop in the Shares of Tata Group Tata Technology

The revenue of Tata Technology is generated from the auto mobile industry and this sector is currently facing challenges.

People in India are still showing lethargy in adopting EV, so the growth of the market has also slowed down. Along with this, more capital is also required to make new vehicles, so companies are not investing as much money to make them. As a result, the demand for Tata Technology service has also decreased somewhere.

There was a contract of Tata Technologies with Vietnamese electric vehicle company Vinfast. Due to this, the company is also earning well. However, now that the contract is completed, it has also affected profits.

Many other engineering contracts of the company have also ended. This has also affected the company’s revenue.

One good thing is that Tata Technology has signed a multi-year contract for EV testing with a car making Europe.

The company has also carried forward its partnership with BMW. Its effect will also be seen on the company’s revenue, but it will take some time.

The company’s shares have also shown the change in EV policy in the US and Europe. In such a situation, companies are avoiding betting on a big project.

The shares of Tata Technology last saw a boom on 5 March. During that time it was closing at the price of Rs 674.40.

Chinese electric vehicle companies are spreading their foot in Europe. Due to this, the pressure on the companies there is increasing. Due to low demand from customers and cost cuts, many companies are cutting into their R&D budget.