Over the years, Tata Technologies has been known as an unlisted company that delivers considerable benefits to its investors and registers constant growth. Backing by India’s giant corporate house, Tata Group, can be a factor behind it, but we will discuss numerous other facts in this write-up.
Tata Technologies – An Overview
Tata Technologies, a global engineering and product development firm, has a vision to “engineer a better world” through collaborations and using climate-resilient methodologies and technologies. The company’s primary focus is on sustainable technological solutions, such as Electric Vehicles, which allow OEMs (original equipment manufacturers) to transform their portfolios and reduce carbon emissions, resulting in a better climate for people worldwide.
Tata Technologies employs over 12,000 people across three continents to serve global customers through a unique on-shore/off-shore supply chain model. This model accommodates the iterative nature of product development services and the potential as well as cost-effectiveness of off-shore locations.
The company’s basic concept is to design and create a better world by assisting clients in producing superior products while also enhancing the quality of life for those who use those products. Tata Technologies accomplishes this through its technical expertise centred on industrial automation, lightweight, economical engineering, electric car programs, and related Digital solutions. Hence, it assists its clients in the design, development, production, and service of entirely safe products with a smaller carbon footprint and a better experience, contributing to a better world for its stakeholders.
The company aims to help clients across industries worldwide build better products through its offerings. The Product will be better for its clients due to the utilisation of the company’s capabilities and solutions, which will assist them in driving efficiencies in their businesses and recognising better products.
The Financial Performance
Tata Technologies, which is not publicly traded, expects to generate nearly $500 million in revenue this fiscal year due to accelerated growth from electric mobility around the world and the off-shoring of projects by its customers in the aftereffects of COVID-19. The company, which had experienced a “sudden decline” in revenue at the start of the pandemic, generated a revenue of $119.3 million in the second quarter of the fiscal year 2022, compared to $80.1 million in the same period of FY21. The company ended FY22 with its best year ever. It increased its net profit by 83% to Rs 436.9 crores in FY22 compared to FY21, while its operating sales were up by 48% to Rs 3,529.6 crores in FY22. In 2023, the company had a revenue of ₹4501 crore while the PAT (Profit After Tax) was around ₹707 crore.
The Growth And Expansion
Tata Technologies will recruit 5,500 people over the next three years to prepare for substantial growth in the electric vehicle and aviation sectors. A top company official told BusinessLine that the Pune-based conglomerate of Tata Motors is looking to increase its workforce by 58% to 15,000 within three years, despite a severe lack of human resources availability.
As per Warren Harris, MD, and CEO of Tata Technologies, the company’s business plan is to grow at a rate of 15-20% per year, so it expects its headcount to grow in tandem. Tata Technologies can achieve optimisation by improving productivity and investing in technology accelerators and platforms.
The business generated outside the Tata Group was the most remarkable aspect of the company’s growth in FY22. Captive accounts such as Tata Motors and Jaguar Land Rover (JLR) had a 42% share in FY22, down from 54% in FY20. Tata Technologies is competing for business in other industries apart from automotive, such as aircraft and industrial equipment. Non-automotive shares are expected to rise from 12-13% to 15-18% in 2-3 years.
Why Is Tata Technologies Assurance Of Profit For Investors?
In the unlisted market, investing in Tata Technologies’ unlisted shares was considered a guaranteed way to reap benefits, and there are many factors behind this. The company is a dominant player in India’s IT and services industries, and it has experienced significant growth in recent years. India is the world’s top outsourcing destination for IT companies. After demonstrating its ability to provide on-shore and off-shore services to worldwide clients, emerging technologies now offer an entirely new set of possibilities for top IT firms in India. By 2025, the industry is expected to be worth US$ 350 billion. In 2022, the IT industry accounted for 7% of India’s GDP. The Indian IT industry’s exports are around US$ 194 billion in FY21. Now the company has launched its IPO which is expected to list the company shares at a whopping ₹910 to ₹920. This is significant as the company’s last share price in the unlisted market was around ₹420.
Additionally, Tata Technologies is a Tata group subsidiary, giving it brand value and an advantage over competitors. Since the company is unlisted, its retail investors are reaping huge benefits as it grows exponentially. Another reason for investors’ assured profit-making is the company’s debt-equity ratio which is 0.13. It indicates an incredibly low risk of bankruptcy. The company has minimal debt in FY ’22, which is solely in terms of lease liabilities so that the company can operate without any short or long-term debts. It is highly beneficial to the company’s long-term growth. The role of online stock trading platforms like Stockify has also benefited investors as they offer optimum ease of buying Tata Technologies’ Unlisted shares.