CEO Warren Harris banks on AI as Tata Tech chases lofty $1 bn revenue target
The company had a net profit margin of 13.1%and $ 611 million.
If it is successful, the movement may help the company reversal the disappointment of the investor in the midst of more than 40% drop in stock price since listing in December 2023. However, to do this, information technology (IT) will have to attract a close miracle by the service industry standards – projects to earn more work, at the same time to improve margins, the costs of cutting costs to improve margins.
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Warren Harris, CEO of the company, put his bets on the things that many of them see as Panacea (AI) Panacea (AI).
“We will continue to be as aggressive as possible when it comes to pricing,” he said in an interview on Sunday. “However, we think that the role of technology and especially the role of AI will increase not only the increase in income, but also to harvest the improvement that will show itself in terms of margin growth.”
Does this mean that AI will eliminate some of the 12,407 work in Tata Technologies?
No, Harris says. The use of AI will control the growth in the company’s number of personnel, but will not lead to any business interruption.
Tata Technologies, which earns a little more than $ 49,000 per employee in FY25, delays peers such as L & T technology services, twice the labor force. Harris connected this to the company that took most of his business from India, where Billings is not as high as in advanced markets.
Re -revival of the automotive business
At the end of the tunnel, the company sees light for the biggest concern – the slowdown in the investments of automobile companies that make up more than 80% of the Tata Technologies business. Customers, including tariffs, including turbulence geopolitical scenario, said they agreed.
This is a good way for Tata Technologies, who sees a twice as a consecutive fold.
“Product plans are being revised, decisions about the supply chain collapses and we begin to see the decisions we expect to come from at the beginning of the financial year.” He said.
“That’s why we think Tata Technologies will return to organic growth.”
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The company will need to grow at a one -year growth rate of 18% to reach 28 financial levels for its billion dollar target.
The ambitious goal behind falling income is to make skepticism. Kawaljeet Saluja led by Kotak Securities analysts envisaged a 5% decrease in revenues in 26 financial years. Analysts, in a note on July 14, “We believe that the income decrease is the most likely result in FY2026E, despite the optimism of the administration in the rest of the year.” He said.
The company expects to increase inorganic growth with the acquisition of € 75 million of Germany’s ES-EC group. Although it is a relatively small company with revenues of $ 42 million in 2024, it can help Tata Technologies, the company’s access to German car manufacturers such as BMW and Mercedes, to diversify the customer base according to Harris.
“This is a diversity game,” he said.
Currently, Tata Technologies receive almost half of the service revenues from group companies Tata Motors and Jaguar Land Rover. Even if the company increases its business with two car manufacturers, it is trying to bring this figure below 40%.
Aviation bet
Tata Technologies also contributes only 5% to aviation business. He counts Airbus as a customer and is now investigating the aircraft manufacturer’s vendors. In addition, American jet engine manufacturers GE Aerospace and Pratt & Whitney is investigating business opportunities.
Considering that the acquisition of ES-TEC was an office in Morocco in Casablanca, Airbus and French car manufacturers Renault and Stellantis will help expand business.
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