Tata Technologies (Tata Tech) is expected to grow 69 per cent to about $800 million by 2025, up from $473 million during 2021-22, driven by an increase in demand in the electric vehicle space and aviation, a top company official has said. The company is also looking at growth through mergers and acquisitions.
“We are expecting business to grow 20 per cent in the next 12 months. We expect to see a 15 per cent CAGR after that. Organically, by 2025, Tata Tech can grow our business to over $800 million,” said Warren Harris, managing director and chief executive officer of Tata Tech — the engineering services and product development arm of Tata Group.
For the year ended March 2022, Tata Technologies’ revenue was seen at $473.5 million, along with an operating profit of $ 86.5 million and profit after tax of $58 million. The year saw a revenue growth of 47 per cent, operating profit growth of 65 per cent, and profit after tax growth of 74 per cent.
“We have an active list of targets we are looking at for inorganic growth. We expect to be actively engaged in terms of mergers and acquisitions in the next couple of years,” he said. The company is betting big on electric vehicles and the digital boom in the automotive and aviation space. It is planning to increase the staff strength in the Bengaluru unit from about 400 to 1,000 in the next 18 months.
The company had tied up with GKN Automotive — a global leader in driveline systems and advanced ePowertrain technologies — and opened a global e-mobility software engineering centre in Bengaluru in October 2020. “The tie-up with GKN is like an endorsement from the entire market as 50 per cent of EVs sold globally have some parts consisting of GKN. We are developing software and embedded electronics (as part of the tie-up),” he added.
Of Tata Tech’s business, nearly 80 per cent comes from the automotive segment, followed by aerospace and industrial-heavy machinery. He added that it was having a diversified basket of clients now. “Six years ago, more than the company’s business was coming from the Tata Group, which is only 31 per cent,” he said.
Source: Business-Standard