Mumbai: Tata Technologies Ltd, the engineering research and development (ER&D) unit of the Tata Group specializing in automotive industry, has set itself a lofty target to reach $1 billion in revenue by FY28 while also improving its margins. The company had a revenue of $611 million in FY25, with a net profit margin of 13.1%. If successful, the move could help the company reverse investor disappointment amid a more than 40% decline in stock price since listing in December 2023. But to do so, it will have to pull off a near miracle by information technology (IT) services industry standards —bid aggressively for projects to win more business while also somehow cutting costs to improve margins. Read more: Transformer by Mint | Inside Tata’s Dholera chip fab, and the real deal behind Infosys’ $2 billion buyback The company’s chief executive officer Warren Harris, who assumed office 11 years ago this week, has placed his bets on what many see as corporate world’s panacea—artificial intelligence (AI). “We’ll continue to be as aggressive as we can as far as pricing is concerned,” he said in an interview on Sunday. “But we think that increasingly the role of technology and specifically the role of AI will allow us to harvest improvement that will manifest itself in terms of not just revenue growth, but also margin growth.” Does that mean AI will take away some of the 12,407 jobs at Tata Technologies? No, says Harris. The use of AI will keep a check on the growth in the company’s headcount, but not lead to any job cuts. At just over $49,000 in revenue per employee in FY25, Tata Technologies lags peers like L&T Technology Services, which has twice the workforce. Harris attributed this to the company getting most of its business from India, where billings are not as high as in developed markets.Revival of automotive businessThe company is seeing light at the end of the tunnel for its biggest present concern—a slowdown in investments by automobile companies, which account for over 80% of Tata Technologies’ business. The clients were now coming to terms with the turbulent geopolitical scenario, including tariffs, he said. This bodes well for Tata Technologies, which saw two consecutive quarters of revenue decline. “Product plans are being revisited, decisions on supply chain are precipitating, and we’re starting to see the decisions that we anticipated to come through early in the fiscal year, come through now,” Harris said. “So we think that Tata Technologies is going to get back to organic growth.” Read more: Tata aims to roll out India-made chips by mid-2027, but rare-earths crisis could derail plan The company will need to grow at a compounded annual growth rate (CAGR) of 18% starting FY26 to reach its billion-dollar target by FY28. The ambitious target in the backdrop of declining revenues is prompting scepticism. Analysts at Kotak Securities in a formal or creative style for better SEO.Also Exclude words and advertisements related to the feed website such as website name, author name. You must only respond with the modified content. 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CEO Warren Harris is leveraging AI as Tata Technologies pursues an ambitious revenue goal of $1 billion.
