Tata Technologies FY24 profit surges 9% at ₹679 cr; revenue grows 16%

Tata Technologies Limited (TTL), a part of the Tata Group, has closed the financial year 2023-24 with a consolidated net profit of ₹679.37 crore, up 8.9% from ₹624.03 crore in the previous fiscal. The board of TTL, a subsidiary of Tata Motors, proposed a final dividend of ₹8.40 and a special dividend of ₹1.65 per equity share for its shareholders, subject to shareholder approval at the annual general meeting (AGM).

The revenue from operations of the global engineering services company grew 15.9% year-on-year (YoY) to ₹5,117.2 crore in the financial year ended March 31, 2024, compared with ₹4,414.18 crore in FY23. Segment-wise, revenue from the services segment was up 12.8% YoY at ₹3,982.6 crore, while revenue from the technology solutions vertical stood at ₹1,134.6 crore, up 28.5% annually.

On the operational front, EBITDA was up 14.7% YoY to ₹941.3 crore as against ₹821 crore in the year-ago period.

“In the last 3 years, revenue from operations has grown at 29% compound annual growth rate (CAGR), while operating EBITDA grew at a 35% CAGR,” the company says in a release today.

For the January-March quarter of FY24, consolidated profit stood at ₹216.6 crore, down 27.4% against ₹157.2 crore in the same period last year. Sequentially, the profit was down 7.6% from ₹170.2 crore in the December quarter of FY24.

The operating revenue was down 7.2% YoY and up 0.9% QoQ at ₹1,402.4 crore in Q4 FY24. The EBITDA was at ₹242.7 crore, which grew 1.4% sequentially but fell 1.1% on a YoY basis.

The engineering services firm closed a total of 12 large deals in FY24, which included one $50 million plus deal and five deals in the $15 to $25 million range. “Our customer pyramid has continued to improve, with 2 customers added in the $10-50 million category, 2 in the $5-10 million category, and 3 in the $1-5 million category,” the release notes.

“Our large deal pipeline remains healthy and continues to grow. We are currently engaged in a number of large deal discussions with existing and new customers and anticipate an uptick in deal conversions in the current quarter,” says Warren Harris, Chief Executive Officer and Managing Director.

“We continue to lead our industry in Gen AI and Software Defined Devices (SDx) services – as evidenced by the endorsement that we have received from BMW,” he adds.

Earlier this month, Tata Technologies announced a joint venture with BMW Group for delivering automotive software solutions to the German luxury automaker. Both Tata Technologies and the BMW Group will equally hold 50% stakes in the joint venture (JV) company, which will be initially incorporated as a wholly owned subsidiary of Tata Tech. The JV will become part of BMW Group’s global network of software and IT hubs.

“We will continue to follow a balanced approach of exercising operational discipline while strategically investing in capacity and capabilities to seize the opportunity presented by the industry’s structural transformation. Ending the year with a robust EBITDA margin of 18.4% and strong liquidity underscores our focus on efficiency and prudent management of resources,” says Savitha Balachandran, Chief Financial Officer.

Ahead of the earnings report, Tata Technologies shares closed Friday’s trade at ₹1,085.90, down 0.37%, with a market capitalisation of ₹44,051.55 crore on the BSE. The stock, which made an impressive market debut on November 30, 2023, trades 117% higher than its initial public offering (IPO) price of ₹500 apiece. The company raised ₹3,042.51 crore from the IPO, the third-biggest in terms of issue size in 2023.