Let's see what Tata Technologies is all about and if it can repeat the success of TCS
A company from the prestigious Tata group has planned to come out with an IPO after 18 years! Yes, the last IPO from the Tata group was the now tech giant Tata Consultancy Services in 2004 which then went on to give 20 per cent returns per annum since listing. Can Tata Technologies replicate it? Only time can tell but for now, let us see what the company is about.
Established in 1989 as a unit of Tata Motors, the company was later spun off as a separate entity in 1994. It is involved in the business of providing engineering, design, product development, and product lifecycle management services to auto and aerospace companies. In simple words, it provides engineering and IT services to automobile manufacturers. The company operates under three divisions: a) Engineering, research, and development where they provide efficient and effective models based on requirements to companies, b) Product lifecycle management where they help with product development and proper implementation of technologies, and c) Connected enterprise IT where it provides IT solutions to the manufacturing industry. Throughout the years, it has won contracts from various players such as Tata Motors, Daimler Chrysler, Hindustan Aeronautics, Jaguar Land Rover, SAESL, and more.
Between FY18 and FY22, Tata Technologies has grown its revenue, operating profits, and net profit by 7, 20.6, and 15.5 per cent per annum respectively. The company is also debt free. In the last five years, it has generated Rs 1,748 crore in free cash flow. We would like to mention that in FY22, the company posted a negative operating cash flow due to a massive increase in loans and advances, and in FY21, it posted an extraordinary operating cash flow due to an increase in trade payables. Here are the key numbers of the company for the last five years.