Tata Technologies reported an 11.4% sequential drop in net profit to Rs 180.8 crore for the June quarter. Excluding the one-time reversal of a provision under the new labour code in Q4FY26, the first-quarter profit growth was 11.3%. The company’s EBITDA margin for the quarter rose by 10 basis points to 16.1%.
The operating EBITDA was up 6.1% to Rs 267.4 crore while revenue rose by 5.9% quarter-on-quarter to Rs 1,664.6 crore. Tata Technologies has guided for strong organic double-digit growth in FY27, with greater acceleration in the second half of the year and margin expansion. FY27 is going to be a breakout year for Tata Technologies, said Warren Harris, CEO and Managing Director of Tata Technologies.
The ongoing investments in AI, disciplined focus on operational efficiency, and continued portfolio diversification have positioned them to deliver strong double-digit organic revenue growth in FY27, Harris said at the investor call on Friday.
The company’s growth during the quarter was driven by business mix, deal momentum, and ramp-up of large strategic wins, including a full vehicle development programme from a Japanese automotive OEM, margin expansion and AI-led efficiency, he said. The demand growth was not just in engineering but in embedded software, digital transformation and software-defined vehicles, Harris said.
Strategic Wins
The joint venture with BMW was growing, and the team had grown to 2,000 engineers and had contributed Rs 17 crore to profit (including deferred profit of Rs 8.3 crore). The company will start executing the five-year $ 100 million Tenneco deal in Q2 and ramp up this fiscal.
As Tata Technologies was a fuel-agnostic technology solutions provider, the company had benefited from the tapering of EV investments by customers and their shift to a more balanced approach to the fuel mix. Harris said this was one of the key drivers of their improved performance.
Around 78% of the company’s revenues came from the services segment. The share of services from the auto segment was 81%, while the non-auto segment revenues were at 19%. The services segment revenue increased by 6.3% q-o-q to Rs 1,296.9 crore. It translated to $136.6 million in dollar terms, a 4.3% increase.
The aerospace business was growing faster than the automotive business, Harris said. Apart from strengthening their relationship with Airbus, their flagship account in the aerospace sector, they were also working with propulsion companies in North America and were not dependent on one customer, the MD said.
Talent Rebalancing
Tata Technologies’ headcount was reduced by 67 to 12,579, with attrition at 16%. A wage hike is expected in Q2, and the company said it would be able to absorb these hikes and continue to maintain margin growth.
The company has retained its margin guidance of 18% for FY27.