The shares of the engineering and digital services provider fell up to 5 percent after the company’s net profit and revenue decreased respectively in the fourth quarter.
With a market capitalization of Rs 42,406.56 crore, the shares of Tata Technologies Ltd were trading at Rs 1,044.75 per share, decreasing around 4 percent as compared to the previous closing price of Rs 1,085.90 apiece.
Looking into the company’s performance, Tata Technologies Ltd’s revenue increased by 1 percent on a quarter-on-quarter basis from Rs. 1,289 crore in Q3FY24 to Rs.1,301 crore in Q4FY24. Further, revenue decreased by 7 percent year on year, from Rs. 1,402 crore in Q4FY23 to Rs. 1,301 crore in Q4FY24.
Tata Technologies Ltd’s net profit decreased by 8 percent on a quarter-on-quarter basis, from Rs. 170 crore in Q3FY24 to Rs. 157 crore in Q4FY24. Further, net profit decreased by 27 percent year on year from Rs. 217 crore in Q4FY23 to Rs. 157 crore in Q4FY24.
In FY24, the business closed 12 significant agreements, including one for more than $50 million and five for $15 to $25 million. Its client pyramid continues to improve, with two new additions in the $10-50 million area, two in the $5-10 million category, and three in the $1-5 million category.
In terms of Tata Tech’s strategic expansion, the company and BMW entered into a strategic joint venture agreement to create Automotive Software and Business IT solutions. Tata Technologies has also signed a five-year Memorandum of Understanding (MoU) with the Telangana government to build “Advanced Technical Skill Training Centers” at 65 industrial training institutes across the state.
The company’s profitability measures show an incline in return on equity (RoE) from 24.48 percent in FY 21-22 to 57.04 percent in FY 22-23, while, during the same period return on capital employed (RoCE) increased from 30.93 percent to 64.28 percent. In contrast, the net profit margin (NPM) was 25.15 percent in fiscal year 22-23.
Tata Technologies Limited is an Indian multinational product engineering business that offers engineering and design, product lifecycle management, manufacturing, product development, and IT service management to automotive and aerospace OEMs.
Written by:- Abhishek Singh
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