Tata Tech plans to hit $500 m in revenues

Tata Technologies (TTL), a part of the Tata Group, is planning to hit half-a billion dollars in revenue on the back of increased deals from electric vehicle (EV) and automotive makers.

TTL, which started off as the technology arm of Tata Motors, in June, sold 43 per cent of its stake to PE major Warburg Pincus for $360 million. As a part of the transaction, Warburg Pincus purchased 30 per cent from Tata Motors and its subsidiary Sheba Properties, as well as the entire 13 per cent stake held by Tata Capital.

Post this stake sale, TTL believes that it can grow at a faster rate due to a couple of reasons. “The deal opens up (Warburg Pincus) network for us and frees us from the perception of not just working for Tata group companies,” Samir Yajnik, President - Global Delivery and COO, APAC, told BusinessLine on the sidelines of the Nasscom Engineering and Design Summit.

Currently, TTL has revenues of $417 million, which it expects to grow to $500 million or a projected growth of 18 per cent, higher than the industry growth which is 12-13 per cent.

TTL gets its revenues from three business segments. Automotive, which is the largest contributes 67 per cent, from clients such as Jaguar Land Rover, aerospace contributes 12 per cent and the remaining comes from industrial design.

TTL has also hit the refresh button with regard to its clients. According to Yajnik, the company is focussing on 100 customers from automotive, aerospace and IHM verticals out of which 20 are its key customers.

This new thrust has largely to do with the kind of clients it is working with now in the automotive sector who are in the EV segment. “We have redrafted our proposition as the times have changed with customers, especially in EV looking at product cycles of 18 months,” said Yajnik. TTL did not disclose companies it is working with, citing non-disclosure agreements that it has signed with companies. It involves ground up engineering, and an exponential use of electronics unlike traditional automotive companies, added Yajnik.

TTL is a global engineering services and product development IT company, with 8,500 employees across 23 countries, including Romania, Sweden. Also, in July this year, TTL opened a new European Innovation and Development Centre in the UK with an investment of £20 million, with an aim to service European clients.

These developments come in the backdrop of N Chandrasekaran, taking over as Chairman of Tata Sons in February. While Chandra is not the executive chairman of TTL, this bullish outlook could help Tata Motors, which still continues to be a significant shareholder in TTL.

Recently, Tata Motors CEO Guenter Butschek told BusinessLine that the company needs to stop bleeding in terms of market-share loss. The company had another setback earlier this month when Tata Motors Chief Technology Officer Timothy Leverton resigned, citing personal reasons.

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