Stay 'Neutral' On Zen Technologies Says Motilal Oswal Post Weak Q2 Results, Trims Target Price

In addition to its core business, the order book has been strong for Zen’s subsidiaries, and a combined revenue contribution of ~Rs 2.5 billion is expected for FY26 with a fairly strong profit profile..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Motilal Oswal Report.Zen Technologies Ltd. posted weak numbersin Q2 FY26, with a miss on revenue but a beat on PAT due to higher-than-expected other income. Inflows in H1 FY26 remained weak; however, management expects inflows to revive in H2 due to the finalisation of the pending simulator order and improved tendering activity for anti-drone systems under the emergency procurement programs. In addition to its core business, the order book has been strong for Zen’s subsidiaries, and a combined revenue contribution of ~Rs 2.5 billion is expected for FY26 with a fairly strong profit profile. Zen is already building up capabilities to expand into marine simulators and eventually into air simulation, too. To bake in its H1 FY26 performance, we cut our estimates for Zen by 25%/11%/ 12% for FY26/FY27/FY28. We also trim our target price to Rs 1,400 (from Rs 1,550), based on 30x Sep’27E EPS. The stock is currently trading at a P/E of 62.1x/33.1x/25.1x on FY26/ FY27/ FY28E EPS. Our estimates bake in a revenue/PAT CAGR of 18%/22% over FY25-28 with a strong Ebitda margin of 37% by FY28. We reiterate our Neutral rating on the stock. We would look for order inflow announcements for further sustainability of revenue going forward.Click on the attachment to read the full report:.Tata Steel Gets Motilal Oswal's 'Buy' Upgrade, Sees 19% Upside — Check Target Price.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Stay 'Neutral' On Zen Technologies Says Motilal Oswal Post Weak Q2 Results, Trims Target Price

Order inflows remained muted due to delays in simulator tenders and a shift in focus on emergency procurements, adds the brokerage.

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