Tata Technologies Ltd Management Discussions

Economic review 1

In CY 2024, the global economy proved resilient, achieving a growth rate of 3.3% despite challenges from geopolitical conflicts, trade tensions and shifts in monetary policy. The consistent pace amid numerous obstacles highlights the remarkable persistence of global economies. While advanced economies expanded at a modest 1.8%, emerging markets and developing economies (EMDEs) registered a growth of 4.3%.

EVOLVING GLOBAL TRADE LANDSCAPE

Global headline inflation continued its downward trajectory, declining from 6.7% in CY 2023 to 5.8% in CY 2024. However, it varies widely across regions— while many advanced economies are making significant progress toward meeting their target inflation rates, some emerging markets continue to grapple with high inflation due to currency depreciation and lingering supply chain disruptions. As inflationary pressures eased, major central banks began to pivot away from tight monetary policies and initiate gradual interest rate cuts, potentially improving liquidity conditions and supporting a revival in private investment.

The global trade landscape is being reshaped by escalating tariff and reciprocal measures prompting a global economy strategic rethink across sectors, particularly in manufacturing. The immediate impact of these tariffs includes increased costs for businesses and consumers, increased uncertainty in cross-border transactions, and renewed disruptions in global supply chains. These developments are also amplifying market volatility and straining relationships between key trade partners. As a result, there is a growing shift toward supply chain reconfiguration and a recalibration of global economic interdependencies. This landscape is expected to significantly impact global supply chains, especially in the aerospace and automobile sectors. These industries depend on complex international networks to source raw materials and specialized components. As trade costs rise and uncertainty grows, companies are reassessing their operations. In aerospace, where companies depend on seamless import of high-grade metals and precision parts, the shifting trade environment will lead to increased production challenges and forced strategic shifts in sourcing. This uncertainty has prompted manufacturers to halt exports, revise production plans, and seek new supply chain configurations, compounding difficulties for sectors still stabilizing from recent global disruptions.

However, many organizations are responding by rethinking their sourcing strategies and speeding up digital supply chain transformation. Companies are also exploring more localized and diversified production setups. While these adjustments may mitigate some risks, economists continue to warn of broader economic slowdowns, with revised growth forecasts for major economies such as the US and China.

The US administration suggests these tariffs could generate substantial revenue and encourage domestic investment, concerns have been expressed about the pass-through of costs to consumers and the potential for reduced trade volumes. The situation remains dynamic, with potential for further adjustments and retaliatory measures that could significantly reshape the landscape of international trade. The long-term impact will depend on how trade tensions evolve and the extent to which businesses adapt to the new landscape.

GDP growth projections (in %)

IMF, WORLD ECONOMIC OUTLOOK, APRIL 2025

GLOBAL ECONOMY

2026	3.0
2025	2.8
2024	3.3
ADVANCED ECONOMIES
2026	1.5
2025	1.4
2024	1.8
EMERGING MARKET & DEVELOPING ECONOMIES
2026	3.9
2025	3.7
2024	4.3

Regional overview & outlook

North America

The US economy grew by 2.8% in CY 2024, driven by strong consumer spending and a strong labor market. However, the introduction of new tariffs in early 2025 has introduced significant economic uncertainties. The tariffs could lead to higher inflation and reduced economic growth. While US monetary policy was expected to ease in CY2025, the Federal Reserve may proceed more cautiously with rate cuts, given the inflationary impact of tariffs and evolving trade-related risks and its impact on economic uncertainty.

Europe

The European economy is projected to experience a gradual recovery, with euro area GDP growth forecasted to accelerate to 0.8% in CY 2025 and 1.2% in CY 2026, following a modest 0.9% expansion in CY 2024. This recovery is expected to be supported by monetary policy easing, continued implementation of NextGenerationEU spending, and a gradual recovery in external demand. However, the recent imposition of U.S. tariffs has introduced significant uncertainty. These measures are anticipated to dampen export growth and add inflationary pressures. In response, the European Central Bank has cut interest rates for the seventh time since June 2024, reducing the benchmark rate to 2.25% to support economic activity amid these trade tensions. 2 Germany, Europes largest economy, continues to face structural challenges. The countrys manufacturing sector, particularly its automotive industry, is navigating through a complex transition towards electrification and digitalisation while contending with growing competition from Chinese manufacturers. Meanwhile, the United Kingdoms economy is showing increased resilience, with growth projected to reach 1.1% in CY2025, reflecting stabilising domestic demand and the gradual normalisation of monetary policy.

Asia remained the global growth engine, with India

benefiting from strong domestic demand, digital

innovation and infrastructure development. China

maintained a moderate recovery momentum supported

by fiscal measures and resilient exports, with the central

bankadoptingameasuredeasingstancetosustaingrowth.

Japans economy is experiencing a gradual recovery in

private consumption, supported by strengthening wage

growth. However, demographic challenges continue to

constrain long-term growth potential.

The region however is negatively impacted by the recent

imposition of U.S. tariffs. Export-driven economies

in Southeast Asia are expressing concerns over the

potential negative impacts on their economic outlooks.

Outlook

Despite ongoing challenges and economic turbulence,

the outlook for CY25 and beyond remains cautiously

optimistic. Global GDP is projected to grow at a

steady 2.8% in CY 2025 and 3.0% CY 2026, supported

by resilient consumer demand and strategic policy

adjustments. Inflationary pressures are expected to

ease further, with global headline inflation declining

to 4.3% in CY 2025, allowing central banks to continue

their transition towards more accommodative

monetary policies.

Trade tensions are likely to remain a significant factor in

the economic landscape, with the potential for further

tariff adjustments as countries respond to US measures.

For businesses, adaptability and strategic foresight

will be essential. Regional trade partnerships and

diversified supply chains are expected to become even

more crucial and emerging markets are likely to play a

prominent role, leveraging their expanding consumer

base and manufacturing capabilities. With a foundation

of strong, adaptable policies and a focus on innovation,

the global economy is well-positioned to navigate

challenges and capitalise on emerging opportunities.

Indian economy 3

The Indian economy maintained its momentum and emerged as one of the fastest-growing major economies amid a complex global landscape and achieved GDP growth of 6.5% in FY 2024-25. This resilience was primarily driven by robust macroeconomic fundamentals, strong domestic demand, and continued policy focus on structural reforms. While the manufacturing sector faced pressures from volatile raw material prices and external trade dynamics, government-led initiatives such as Make in India are reinvigorating industrial growth. The services sector remained a key driver of economic momentum, further supported by digitalisation, innovation, and engineering exports.

Indias GDP growth 4 (in %)

FY 2024-25 SAE	6.5
FY 2023-24 FRE	9.2
FY 2022-23	7.6
FY 2021-22	9.7
FY 2020-21	(5.8)
FY 2019-20	3.9
FY 2018-19	6.5
FY 2017-18	6.8
FY 2016-17	8.3
FY 2015-16	8.0

FRE - First Revized Estimates SAE - Second Advance Estimates

(

Trend in capital expenditure J in lakh crore)

Indias growth path remains broad-based and inclusive,

with real GDP expected to expand steadily, supported by

high-capacity utilisation, continued public infrastructure

investments, and an increasing private Capex cycle.

Key government capital expenditure in transport, digital

infrastructure, and green energy is creating a conducive

environment for innovation-led industries. In this evolving

landscape, Tata Technologies is advancing its vision of

engineering for the world, by leveraging its global capabilities

coupled with Indias vibrant tech ecosystem to develop

AI-powered platforms, software-defined vehicle capabilities,

and digitally connected customer experiences that serve

global mobility needs.

The government is expected to meet its fiscal deficit target

of 4.4% for FY 2025-26 through aggressive disinvestment

and monetisation of assets. 5

Headline inflation over the years (in %)

FY 2024-25	4.6
FY 2023-24	5.4
FY 2022-23	6.7

Inflation remained broadly within the Reserve Bank of Indias (RBI) target range, supported by proactive monetary policy, despite supply-side pressures and global commodity volatility. The RBI maintained a calibrated policy stance, managing inflation and supporting economic growth. Headline inflation eased to 4.6%, primarily due to a moderation in food inflation. Monetary policy measures played a crucial role in maintaining liquidity and supporting economic activity. Foreign direct investment (FDI) remained strong, particularly in manufacturing and other key sectors. The RBI reduced the repo rate by 25 basis points to 6.00% in its April 2025 monetary policy committee meeting, following an earlier cut to 6.25% in February 2025, alongside a CRR reduction to 4% in 2024. This marks back-to-back rate cuts as the RBI shifts to an accommodative stance in response to easing inflation and global uncertainties, including the impact of new US tariffs. These measures have injected additional liquidity into the financial system, eased borrowing costs and are expected to further support credit availability and economic growth. This uptick in industrial activity reflects strong domestic demand and a more positive business outlook. The manufacturing sector, after experiencing some moderation in growth during the first half of FY 2024-25, has shown signs of revival, supported by government initiatives aimed at enhancing domestic manufacturing capabilities. Industrial growth has strengthened as indicated by the Index of Industrial Production (IIP), which shows that the output of Indias industry grew by 5% in January 2025.

Sectoral contribution to IIP growth (%)

Outlook

The Indian economic outlook remains positive, driven

by rising consumer demand, improved investment

activity and strategic policy measures that position

India as a competitive global player. The continued push

for initiatives like Make in India, Aatmanirbhar Bharat,

and green industrialisation is expected to generate

employment and investment opportunities across

sectors. These measures, combined with improving

global trade dynamics and Indias deeper integration

into global supply chains, are revitalising core sectors

like manufacturing and infrastructure, setting the stage

for sustained economic momentum.

A key shift is an upturn of private capital expenditure,

accompanied by improving business confidence and

long-term policy clarity. The outlook is being further

strengthened by the Union Budget 2025-26 as it

prioritises investments in urban infrastructure, clean

energy, taxation reforms, and MSME development.

These interventions are laying the groundwork for

sustainable industrial expansion. Importantly, the

budgets focus on innovation, skilling, and energy

transition highlights a clear commitment to building a

competitive, technology-led economy that can support

advanced manufacturing and engineering at scale.

Tata Technologies is uniquely positioned to capitalise on

this transformative phase with our global delivery model

that is designed to combine the best of both worlds: the deep technical expertise and scalability offered by our engineering centres in India, and the proximity, agility, and domain alignment provided by our Global Delivery Centres located closer to our customers. As India continues to emerge as an important pillar of our capabilities — a centre of excellence for innovation, Digital Engineering, and talent development, your Company stands to unlock expansive opportunities in delivering innovative, scalable solutions to global manufacturing clients. This hybrid approach not only enhances responsiveness and collaboration but also reinforces our ability to deliver value at scale across geographies. As we expand our global footprint, we continue to harness Indias strengths in engineering excellence, cost competitiveness, and policy alignment, ensuring that our customers benefit from a seamless, globally integrated service experience.

Industry overview

Engineering, Research and Development (ER&D)

The global ER&D landscape is navigating a complex interplay of growth opportunities and geopolitical challenges, notably the ongoing tariff and trade tensions between major economies. While the situation is still fluid and there are different scenarios in which this could play out over the next few years, the position taken by major countries may potentially reshape manufacturing landscape, global supply chains as well as increase input costs for manufacturers. In response to this, companies are likely to catalyze strategic shifts towards regional diversification and cost-optimized innovation.

The global manufacturing sector is experiencing unprecedented transformation, driven by the convergence of engineering, digital technologies and automation. This evolution is reshaping traditional manufacturing processes and business models across various sectors including automotive, aerospace and industrial heavy machinery sectors. The global ER&D outsourcing market has emerged as a significant economic force, valued at approximately $535.2 billion as of CY 2024. 6 India is well-positioned to capture a significant share of the global ER&D sourcing market, leveraging its strong value proposition and abundant talent pool. By FY 2029-30, India is expected to contribute 22% to the global ER&D sourcing market. 7

The integration of AI, cloud computing, embedded systems and Industry 4.0 technologies is enabling manufacturers to enhance productivity, improve quality and accelerate innovation while reducing costs. As organisations navigate this complex landscape, they are increasingly turning to specialized ER&D service providers to access domain expertise, accelerate time-to-market and optimise costs. This shift is creating significant opportunities and positioning Your Company as a strategic innovation partner to global clients delivering faster, more customized and cost-effective intelligent solutions to its clients with deep domain knowledge and digital capabilities.

In 2024, global ER&D spending by enterprises reached USD 2.34 trillion and is projected to grow to USD 3.25 trillion by 2028, reflecting a CAGR of 7.5-8.5%, as per estimates shared by Zinnov Zones. This growth highlights ER&Ds significant role in fuelling innovation-led transformation.

Generative AI is revolutionizing the ER&D sector. It significantly accelerates concept design by rapidly generating multiple design iterations, allowing engineers to explore a wider range of possibilities in a shorter time. Additionally, Gen AI enhances simulation accuracy, providing more precise and reliable results that reduce the need for extensive physical prototyping. Digital-first engineering is gaining prominence, growing at an estimated 10-12% CAGR. This growth is driven by the increasing demand for smarter, software-defined and sustainable products. Digital technologies such as cloud computing, AI/ML, 5G and Industry 4.0 are fundamentally transforming how products are imagined, developed and delivered. This transformation is reinforced by shortening innovation cycles, elevated consumer expectations and increasing convergence of mechanical, embedded and software disciplines.

This trend is particularly significant in the automotive sector, where Original Equipment Manufacturers (OEMs) face pressure to simultaneously invest in multiple technology platforms including electric vehicles, software-defined vehicles (SDVs) and autonomous driving systems. The auto ER&D segment alone is expected to grow into a $500 billion market by CY 2030, reflecting the increasing willingness of OEMs to partner with specialized service providers. 8 As innovation cycles shrink and product complexity increases, ER&D is shifting from a support role to a strategic differentiator. Your Companys deep domain expertise, platform capabilities and digital-first approach position it to lead the next wave of transformation. With a focus on Digital Engineering, sustainability, and accelerated innovation, Tata Technologies is helping customers accelerate innovation while navigating cost and regulatory pressures.

Key factors driving digital transformation in manufacturing

Enhancing operational resilience	Manufacturers are investing in digital twin technologies, smart manufacturing solutions and predictive analytics to improve visibility and control across global operations. These innovations help mitigate supply chain disruptions and enhance overall operational efficiency.
Meeting regulatory and sustainability goals	Stringent regulations and growing sustainability imperatives are pushing manufacturers to redesign products and processes that minimise environmental impact. Digital solutions are being leveraged to optimize resource utilisation and ensure compliance with evolving standards.
Adapting to evolving consumer expectations	Consumers now demand personalized and connected products, prompting manufacturers to integrate advanced software and intelligence into their offerings. This shift is driving the adoption of digital technologies to enhance product innovation and customer experience.

ER&D applications across industries

Automotive industry

Global new vehicle sales in CY2025 are projected to grow by 1.7% year-on-year, reaching 89.6 million units. 9 Despite recent economic headwinds and geopolitical tensions causing some short-term delays in decision-making, the ongoing transformation of the automotive industry continues to drive long-term demand for engineering services. The industry is experiencing a strategic reconsideration across propulsion technologies, with investments being diversified across electric vehicles, hybrids and internal combustion engines.

Automotive business ER&D spend

The shift towards electrification and hybridisation continues to reshape the automotive landscape. Despite recent slowdowns in EV adoption, global EV sales are projected to exceed 20 million units in CY2025 and surpass 40 million units in CY2030. 10 By 2030, almost one in three cars on the road in China is expected to be electric, while approximately one in five in the US and European Union will be electric. 11 This transition requires significant engineering investments in battery technology, charging infrastructure and vehicle architecture redesign.

The growth of self-driving and connected vehicles represents another transformative trend in the automotive industry. While fully autonomous vehicles remain a longer-term prospect, advanced driver assistance systems (ADAS) continue to evolve rapidly, creating demand for sophisticated software, sensors and computing platforms. Connected vehicle technologies are becoming standard features, enabling new service models and revenue streams for automotive OEMs.

Automotive ER&D is experiencing dynamic shifts, with a 6-8% CAGR spend increase till 2028. The rise of Software-Defined Vehicles (SDVs) is revolutionizing the sector, driving the demand for continuous software innovation, ADAS integration, cybersecurity enhancements and OTA (Over-the-Air) updates. Additionally, the adoption of ACES (Autonomous, Connected, Electric, Shared) paradigms highlights the growing reliance on digital ER&D services within the automotive industry. The long-term trajectory towards electrification remains intact, with significant growth expected in Asia Pacific markets. Software-defined vehicle capabilities are expected to extend beyond passenger vehicles into commercial vehicles and off-highway equipment, creating new opportunities for ER&D service providers with expertise in embedded software and systems integration. AI-driven vehicle software and cloud-based connected car solutions will become increasingly important differentiators for automotive OEMs.

9 Auto Sales Forecast: 89.6M Vehicle Sales Worldwide 2025, S&P Global

10 Prospects for electric vehicle deployment 2025, IEA

11 Global EV Outlook 2024, IEA

12 Light Vehicle Production Forecast, May 2025, S&P Global

Key factors driving digital transformation in manufacturing

	Ongoing investment in battery technology, lightweight materials and charging
	infrastructure.
	Electrification remains on track, with OEMs focusing on solid-state batteries and energy-
	efficient designs.
Electric vehicles
	Embedded software is driving differentiation, with AI, cybersecurity and advanced
	software creating new revenue streams.
	SDV adoption is expanding in commercial vehicles beyond passenger cars.
Software-defined vehicles
	Autonomous and Connected Vehicles continue to evolve, driving growth in ADAS and
	AI-driven mobility solutions.
	While fully autonomous vehicles remain a longer-term prospect, the development of
Autonomous and	advanced driver assistance systems continues to accelerate, creating demand for
connected vehicles	sophisticated software, sensors and computing platforms.
	Global decarbonization commitments are pushing manufacturers to rethink engineering
	practices. Regulations such as CAFE standards and net-zero targets are accelerating the
	shift toward electric vehicles, recyclable materials and lightweight structures.
	Policies on net-zero emissions and alternative fuels are accelerating R&D across electric,
	hybrid and traditional propulsion systems and increasing engineering investments.
Sustainability,	For OEMs, sustainability is now a core differentiator and Tata Technologies is enabling
electrification	this journey for manufacturers through electrification solutions, carbon footprint analysis
& lightweighting	and tracking across product lifecycle and green engineering systems.

Aerospace and defense industry

Aerospace & defense remains a critical ER&D vertical, with a CAGR of 8.5-10.5%. In this highly regulated industry, Digital Engineering plays a pivotal role in reducing time-to-certification, enhancing production through put, enhancing uptime and streamlining compliance. The global aerospace market continues to experience strong growth, driven by substantial backlogs in the commercial aviation and defense sectors. Airlines and OEMs are investing heavily in digital thread solutions, smart manufacturing capabilities and lightweight materials to accelerate production throughput and improve operational efficiency. The aircraft cabin interior industry has rapidly evolved into a crucial aspect of the airline industry. The market size is projected to grow from USD 26.1 billion in 2024 to USD 31.6 billion by 2029. North America is expected to hold the highest market share in the aircraft cabin interiors market, supported by its robust technological infrastructure, significant investment in aviation innovation and a high concentration of frequent flyers. 13

With global supply chain disruptions driving up costs, Passenger to Freight (P2F) conversions has become an attractive solution for airlines seeking affordability. The P2F market is expected to grow significantly, from USD 2,996.6 million in 2024 to over USD 6,444.9 million by 2032. 14

13 Aircraft Cabin Interiors Market Size, Share, Trends, Global Forecast to 2029, MARKETSANDMARKETS 14 Passenger to Freighter Market - Size, Share, Industry Trends, and Forecasts (2025-2032), Consegic

It offers a cost-effective alternative to purchasing new cargo aircraft, enabling airlines and leasing companies to extend the operational life of aging passenger fleets while meeting the increasing demand for air freight capacity.

World freighter fleet in service will reach 3,360 aircraft by 2043 15

Number of aircraft

The demand for digital solutions to optimize aircraft design and operations continues to grow as the industry seeks to enhance efficiency, reduce costs and improve safety. Digital twin technology, predictive maintenance systems and advanced analytics are being deployed across the aircraft lifecycle— from design and manufacturing to maintenance and operations. These technologies enable manufacturers and operators to optimize performance, minimise downtime and extend the lifespan of the aircraft.

At the same time, the increasing focus on net-zero emissions and sustainable aviation fuel (SAF) is reshaping research and development priorities across the aerospace industry. Major OEMs and airlines are committing to ambitious sustainability goals, driving investments in more fuel-efficient aircraft designs, alternative propulsion systems, and sustainable aviation fuels. These initiatives are creating significant opportunities for engineering service providers with expertise in aerodynamics, lightweight materials and propulsion systems.

Key industry trends	Urban air mobility and eVTOL aircraft are gaining traction, requiring innovations in design, certification and operation. This creates opportunities in lightweight structures, electric propulsion and autonomous systems.
Advanced air mobility	AI-driven analytics and digital twin technology are optimising aircraft performance, reducing unscheduled maintenance and extending aircraft lifespan, leading to cost savings and efficiency gains.
AI and predictive maintenance	Industry 4.0 applications, including robotics, augmented reality and digital thread solutions are streamlining aircraft production and maintenance, helping manufacturers tackle order backlogs and rising demand.
Smart manufacturing

Industrial Heavy Machinery (IHM)

The industrial machinery market is essential to the global manufacturing ecosystem, encompassing equipment used in production, construction, mining and agriculture. The Industrial & Heavy Machinery and Construction Heavy Machinery (CHM) sectors are witnessing renewed digital momentum, with CAGRs of 9-12% and 6-8%, respectively. Innovations in autonomous machinery, intelligent construction platforms and remote operations are redefining operational excellence. As companies across the globe are striving to meet evolving standards, they are updating their equipment to enhance productivity, improve quality and address labor shortages. As a result, the demand for versatile and high-performing industrial machinery is on the rise, setting the stage for continued expansion in this market. In 2024, the global industrial machinery market was valued at USD 1.2 trillion and it is projected to grow to USD 1.6 trillion by 2030. Advanced robotics, autonomous guided vehicles (AGVs) and collaborative robots are being integrated into manufacturing operations, from material handling to assembly and quality control. These innovative technologies enable manufacturers to optimize production processes, reduce operational costs and improve workplace safety.

Key industry trends

	Stricter environmental regulations and sustainability goals are driving industries to adopt energy-efficient, low-emission machinery. Companies are replacing outdated equipment with eco-friendly alternatives to ensure compliance and achieve long-term energy savings.
Sustainability concerns	Increased adoption of IoT, AI and automation in manufacturing is enabling real-time monitoring, optimisation and predictive maintenance that improves productivity and reduces costs.
Industry 4.0 and smart factories	AI-driven solutions are streamlining real-time monitoring and production efficiency by creating virtual replicas to simulate, analyse, and optimize performance.
Digital thread and digital twin	The electrification of heavy equipment is accelerating, with a shift from diesel-powered to electric and hybrid industrial machinery. Also, battery technology, power electronics and energy management systems are key focus areas for engineering development in this sector.
Electrification of heavy equipment

Digital Engineering and Embedded Systems

The rise of the Internet of Things (IoT) marked a significant turning point for embedded systems engineering. The market for cloud-based engineering solutions continues to grow as organisations seek to enhance collaboration, accelerate development and optimize costs. Cloud-based platforms for design, simulation and product lifecycle management enable distributed teams to work together effectively, access powerful computing resources on-demand and scale capabilities based on project requirements.

The role of AI, machine learning and edge computing in product design is increasing rapidly as organisations seek to enhance innovation, optimize performance and reduce development time. AI-powered design tools, generative design algorithms and advanced simulation capabilities enable engineers to explore more design alternatives, predict performance with greater accuracy and identify optimal solutions more efficiently. Moreover, edge computing enables real-time data processing and decision-making at the point of use, reducing latency and enhancing responsiveness.

The demand for real-time analytics and AI-driven automation continues to grow across industrial sectors. Advanced sensors, edge computing and AI analytics are being deployed to monitor and optimize operations in real-time, from manufacturing processes to product performance in the field. These technologies enable organizations to boost productivity, improve quality and reduce costs through continuous optimisation and predictive insights.

Key industry trends

Adoption of artificial intelligence	Transforming engineering with AI-driven design, testing and predictive maintenance, optimising performance and accelerating innovation across the product lifecycle.
Edge computing and embedded AI	Enabling real-time AI-driven decision-making in smart vehicles, factories and industrial processes. Embedded AI capabilities are being integrated into vehicles, machinery and industrial equipment to enable autonomous operation, predictive maintenance and adaptive behaviour.
Cloud-based PLM and digital thread	Enhancing collaboration through cloud computing, ensuring real-time product lifecycle management and seamless data flow across distributed teams.
Electrification of heavy equipment	The electrification of heavy equipment is accelerating, with a shift from diesel-powered to electric and hybrid industrial machinery. Also, battery technology, power electronics and energy management systems are key focus areas for engineering development in this sector.

Your Company is at the forefront of this transformation, investing strategically in future-ready capabilities. Your Company is focused on talent transformation to meet rising demand for skills in cloud, AI, cybersecurity and systems engineering.

Company overview

Tata Technologies Limited has been at the forefront of engineering and digital transformation since its inception. Your Company was founded in 1989 as the automotive design unit of Tata Motors and later established as an independent entity in 1994. Your Company has evolved into a leading global engineering services provider, catering to the automotive, aerospace and industrial machinery sectors. Built on the Tata Groups legacy of innovation and excellence, Tata Technologies is dedicated to engineering better products and experiences for its clients worldwide. Your Companys core business philosophy is enabling manufacturers to design, develop and realise competitive products by leveraging cutting-edge digital technologies, product engineering expertise and robust domain knowledge. With a mission to engineer a better world, your Company empowers businesses by providing end-to-end solutions that enhance operational efficiency, reduce time-to-market and drive sustainability. Your Company continues to deliver significant value to its global customers through strategic investments in digital transformation, electrification and Industry 4.0 solutions.

#1

India-based, global automotive ESP in Zinnov Zones for the 8th consecutive year

Among top

2

Global Engineering Service Providers (ESP) in electrification

32

Countries global presence

12,644

Employees

With a customer presence in over 30 countries and a team of 12,644 professionals across its global delivery centres spanning India, North America, Europe and the Asia-Pacific region, your Company has established itself as a preferred engineering and technology partner for leading original equipment manufacturers (OEMs) and Tier 1 suppliers. Your Companys global delivery execution model is designed around the follow the sun workflow, with project teams collaborating across off-shore and on-site locations worldwide to deliver maximum progress and efficiency. Your Company delivers value through a comprehensive portfolio spanning engineering, research and development (ER&D), digital enterprise solutions, education services and software products, enabling clients to conceptualise, develop and realise better products and experiences. Recognized as a global leader in the ER&D services space, particularly in the automotive sector, your Company has consistently ranked first among all India-based global automotive ER&D specialists for multiple years in a row. This leadership is built on your Companys key differentiators — delivering better results, faster product development, safer products and greener technologies.

Your Companys commitment to sustainability is embedded across its operations, from developing end-to-end electric vehicle solutions and lightweight structures to implementing sustainable practices in facility management. With a strong focus on innovation and digital transformation, your Company enables clients to integrate traditional engineering with AI and cloud computing. Industry-first solutions like the Electric Vehicle Modular Platform (eVMP), digital twin technology and AI-driven predictive maintenance highlight this commitment to smart innovation. Recent milestones include strategic collaborations with leading global OEMs, expansion into new geographies and investments in talent and emerging technologies. Your Company remains dedicated to delivering superior engineering solutions, driving long-term growth for stakeholders and contributing to the future of sustainable mobility and smart manufacturing.

SCOT analysis

Strengths

Strong Tata lineage Group backing - Your Company benefits from the Tata Groups legacy, credibility and financial stability, positioning it as a trusted engineering and digital solutions provider.

Global presence - Serving leading OEMs and Tier 1 suppliers with Customer presence across 30+ countries and a strong footprint in the automotive, aerospace and industrial heavy machinery sectors.

Comprehensive service offerings - A well-diversified portfolio across Engineering, Research & Development (ER&D), Digital Enterprise Solutions (DES), Embedded Engineering Solutions, Education Solutions and Software Products.

Industry leadership - Recognized as Indias top automotiveER&Dserviceproviderandagloballeader in electrification and software-defined vehicles.

Commitment to Innovation - Significant investments in AI-driven engineering, digital twin technology, predictive maintenance and Industry 4.0 solutions.

Sustainability focus - Strong initiatives in green engineering, electrification and smart manufacturing to align with global sustainability goals.

Opportunities

Expansion in software-defined vehicles and electrification - Increasing demand for EVs, battery technologies, and SDV solutions opens new revenue streams.

Digital manufacturing and Industry 4.0 - Manufacturers are adopting digital tools like digital twins, MES, PLM and ERP to improve real-time decisions and visibility. But old systems, scattered platforms and high costs slow progress. Solving these with smart, scalable solutions is a big opportunity for ER&D firms like Tata Technologies.

Emerging aerospace and defense markets - Increased investments in MRO (Maintenance, Repair & Overhaul), passenger-to-freighter conversions and lightweight materials are creating market potential.

Skill demand - Rising demand for Industry 4.0-ready talent provides expansion opportunities in digital learning and workforce training.

Greenengineeringsolutions -Growingprioritisation of governments and industries towards net-zero emissions and eco-friendly engineering solutions creating new business prospects.

India as a strategic manufacturing hub – With supportive policies like PLI schemes and a skilled talent base, India is fast emerging as a global centre for manufacturing of EVs. Your Company is driving this transformation through strategic investments in future-ready capabilities.

Challenges

Talent gap - The rapid evolution of AI, SDVs, and embedded systems necessitates continuous upskilling and recruitment of specialized talent.

Regulatory compliance and market uncertainties – Your Company operates in multiple geographies, requiring adherence to diverse regulatory standards and facing geopolitical risks.

Threats

Intense competition - Growing competition from global ER&D and IT service providers could exert pricing pressure and impact market share.

Macroeconomic uncertainties - Recession risks, geopolitical instability and fluctuating market conditions can impact investments in R&D and digital transformation projects.

Disruptive technological changes - Rapid advancements in AI, quantum computing and next-gen automation could alter industry dynamics, requiring continuous innovation.

Cybersecurity risks - The growing adoption of connected technologies increases your Companys exposure to cyber threats, data breaches and intellectual property violations. To mitigate these risks, it is essential to establish robust cybersecurity frameworks and proactive risk management strategies.

Business segments

Services segment

The Services Segment forms the core of your Companys operations, offering comprehensive engineering and digital solutions to global manufacturing clients. With a focus on innovation and efficiency, the segment addresses the evolving needs of our customer industries by combining traditional engineering expertise with cutting-edge digital technologies.

78%

Revenue contribution in FY 2024-25

Industry overview

Engineering, Research & Development

Your Companys ER&D services form the cornerstone of its value proposition, enabling global OEMs and their ecosystem partners to design, engineer, manufacture and deliver better products. ER&D provides comprehensive engineering solutions spanning the entire product development lifecycle from conceptualisation and design to manufacturing, validation and production support. Your Company delivers future-ready, sustainable product design and engineering solutions across automotive, aerospace, and industrial heavy machinery sectors, with capabilities in full vehicle development, embedded systems, electrification, and software-defined vehicles.

In the automotive sector, your Company provides turnkey vehicle development solutions, embedded software development, connected vehicle technologies and testing and validation services including Hardware-in-Loop (HIL), Software-in-loop (SIL) and ECU virtualization. These comprehensive offerings help clients accelerate product development and enhance vehicle performance.

For aerospace clients, your Company provides expertise in airframe design, cabin interiors, passenger-to-freighter conversions, electrical systems installation, robotics, and model-based systems engineering. These solutions are tailored to meet the demands of modern aerospace innovation and efficiency. In the industrial heavy machinery segment, your Company delivers full vehicles development solutions for construction equipment, mining machinery, agricultural vehicles, and industrial engines, with specialized capabilities in cab development, hydraulic systems, powertrain integration, and embedded software, ensuring optimal performance and reliability for heavy-duty applications.

Digital Enterprise Solutions (DES)

Your Companys digital enterprise solutions help clients navigate their digital transformation journey using next-generation technologies that solve complex industry challenges. It delivers solutions across digital manufacturing, data analytics, predictive maintenance, artificial intelligence, and machine learning as organizations move toward Industry 4.0. Your Companys digital enterprise solutions enable manufacturers to enhance operational efficiency, improve product quality, and accelerate innovation while optimising costs.

The DES portfolio includes digital transformation solutions that enable competitive product development, digital manufacturing solutions that optimize production processes, digital customer experience solutions that enhance customer interactions, and enterprise transformation solutions. Your Companys expertise spans key technology domains such as cloud computing, IoT, AI and machine learning, digital thread, and digital twin technologies. These capabilities enable clients to create connected enterprises that drive better business outcomes. These solutions help manufacturers enhance visibility across their operations, improve decision-making through data-driven insights, and create seamless customer experiences.

Technology solutions

This segment focuses on value-added software solutions supporting digital transformation in product development and upskilling for industry relevant capabilities.

22%

Revenue contribution in FY 2024-25

Education solutions

Your Companys education solutions address the critical need for skilled talent in the manufacturing industry through academia-industry collaboration. Your Company engages with colleges, universities, and governments to empower the next generation of engineers and technicians with in-demand skills and upskill to enhance their employability and preparing them to excel in a rapidly evolving technological landscape. Your Company offers upskilling solutions and training programs to equip future talent with the skills needed to work and innovate with the latest engineering and manufacturing technologies. The education solutions portfolio includes upskilling programs, competency centres of excellence, and the iGET IT online learning platform. To bridge the gap between academia and industry, your Company has established significant partnerships with state governments across India to implement phygital (physical and digital) learning models that combine infrastructure development with digital content delivery. These initiatives ensure that educational outcomes align with the evolving needs of the manufacturing sector.

Software products

Complementing its service offerings, your Companys software products provide value-added reselling and integration of leading engineering and product development software. It enables customers to enhance Digital Engineering, optimize design processes, and accelerate innovation in product development. Partnering with industry leaders, your Company delivers solutions in PLM, CAD, CAM and simulation technologies. Your Companys value proposition extends beyond software reselling to include consulting services, implementation support, customisation and training. This comprehensive approach ensures that clients derive maximum value from their software investments while aligning with their strategic business objectives.

Operational highlights

Strategic deal wins across key verticals

Tata Technologies recorded several high-value, multi-year contract wins across its core verticals - Automotive, Aerospace and Industrial Heavy Machinery. In the automotive segment, a leading commercial vehicle OEM selected Tata Technologies as their SDV technology partner for the development of a middleware stack. Your Company also secured a long-term engagement with a European luxury OEM for testing and validation of a new battery electric vehicle, as well as major wins in EV battery and pack design, e-Propulsion system engineering and a turnkey cab development project for a leading North American commercial vehicle manufacturer. Your Company was also selected by a North American Tier-1 automotive supplier to establish an offshore development centre focused on embedded software development and partnered with a global technology provider to deliver emission reduction and energy efficiency solutions for advanced vehicle components.

In the aerospace domain, your Company was awarded multiple contracts with a European Aerospace OEM as well as Tier-1s across Europe and North America in areas including Aerostructures, propulsion systems, MRO and digital. We are proud to see the real-world impact of our investments in AI and generative AI. Over the past year, we have successfully deployed AI and Generative AI to assist our customers in:

Establishing AI governance frameworks that enable responsible AI usage, mitigate risks, and maximize the value of AI-driven innovation.

Optimizing raw material purchasing across extensive supply chains, ensuring efficiency and cost-effectiveness.

Advancing autonomous driving capabilities by accelerating object detection speeds.

Revolutionizing sales performance with Generative AI-powered virtual sales assistants.

Reducing unplanned downtime and scrap through predictive maintenance and defect detection.

Beyond its core verticals, your Company expanded its presence in education technology through a partnership with various state Governments in India for deployment of learning solutions across the Industrial Training Institutes (ITIs).

BMW TechWorks India

Tata Technologies officially launched operations under its strategic joint venture with BMW Group with dedicated delivery centres across Pune, Bangalore and Chennai. The partnership is focused on building a global hub for automotive software and digital services. BMW TechWorks India brings together the BMW Groups legacy of pioneering research, technology leaps and engineering breakthroughs with the global product engineering and digital services expertise of TATA Technologies. Starting with a core team of over 100 professionals, the JV is scaling faster than we expected. We are now approaching the four-digit headcount milestone originally projected for calendar year end and anticipate continued growth throughout FY 2025-26.

Air India collaboration

Tata Technologies entered into a strategic collaboration with Air India to support the airlines ambitious fleet expansion and modernisation plans. Leveraging its deep expertise in aerospace engineering and digital solutions, Tata Technologies is working with Air India on projects related to cabin interior design, passenger experience enhancement and digital transformation of engineering processes

Connected vehicle innovation

Tata Technologies enhanced its connected vehicle solutions to support real-time data exchange, cloud-based SDV development and diagnostics. Your Company showcased its innovations at CES 2025, such as ADAS, cybersecurity, heterogeneous computing and Gen AI-powered solutions that align with next-gen automotive requirements.

Strategic collaboration with Telechips

At CES 2025, Tata Technologies announced a strategic partnership with Telechips to co-develop next-generation solutions for software-defined vehicles. This collaboration combines Tata Technologies expertise in automotive software engineering with Telechips advanced semiconductor platforms which is enabling the joint development of Advanced Driver-Assistance Systems, cockpit domain controllers and central/zonal gateway controllers. The partnership is expected to accelerate the delivery of innovative, safe and intelligent mobility solutions to global automotive OEMs.

InnoVent 2.0

Tata Technologies, in partnership with Microsoft and Tata Motors, launched InnoVent 2.0- a nationwide hackathon focused on Generative AI. This initiative provided a platform for engineering students across India to develop and showcase AI-driven solutions for product engineering, manufacturing and customer experience. InnoVent 2.0 attracted participation from over 200 top engineering colleges.

Tata INNOVISTA awards

Your Companys culture of innovation was recognized at the prestigious Tata INNOVISTA Awards, where Tata Technologies won two awards for its pioneering work in Digital Engineering and Gen AI-powered solutions. The winning projects included a Gen AI-powered digital sales assistant and a convertible 3-wheeler to 2-wheeler vehicle design.

#EngineeringASoftwareDefinedFuture Brand Campaign

The global branding campaign highlighted your Companys position in software-led automotive transformation. It emphasized your Companys three-decade legacy in engineering innovation, its investments in AI-led digital solutions and its role in transforming automotive, aerospace and industrial machinery sectors. Through this initiative, your Company showcased its commitment to helping clients accelerate product development, reduce time-to-market and deliver next-generation mobility experiences.

Business outlook

The macroeconomic environment remains dynamic, shaped by ongoing geopolitical shifts and evolving regulatory landscapes. In the US, automotive OEMs are increasingly embracing a more balanced propulsion strategy, sustaining investments across internal combustion engines, hybrids and electric vehicles as consumer preferences and policy signals remain mixed. In Europe, uncertainty surrounding tariffs and evolving industrial policies, especially in response to competition from China, has led to delays in key investment decisions. However, we are beginning to see the early signs of foundational investments and the green shoots of improvement. While near-term caution persists, we remain optimistic about medium-term-to-long-term ER&D investment in the automotive industry. Continued innovation in electric, autonomous and sustainable mobility is expected to be a key growth driver. Our strong domain expertise, expanded software-defined vehicle offerings and AI-led solutions across the product life cycle position us well to support OEMs and suppliers as they recalibrate for the next phase of mobility transformation. In contrast, demand in the Aerospace and Industrial Heavy Machinery sectors remains robust. Our aerospace business nearly doubled its revenues in FY 2024-25 compared to FY 2023-24 supported by a healthy order book and strong execution. We are confident that this momentum will be carried forward into FY 2025-26.

Risk response strategy

Your Company has put in place a well-defined risk response strategy to address emerging threats and market uncertainties. Central to this approach is proactive scenario planning, which enables the organization to anticipate and navigate potential disruptions. Your Company is strategically diversifying its vertical mix by strengthening its presence in the Aerospace and IHM sectors and diversifying beyond core automotive into adjacent high-growth verticals. In line with our future-ready focus, we are making targeted investments in high-growth areas such as Software-Defined Vehicles, embedded systems and cybersecurity to ensure your Company stays ahead in a rapidly evolving tech landscape. Additionally, your Companys success in securing large, multi-year deals with global OEMs and Tier-1 suppliers not only reinforces customer trust but also provides a stable revenue foundation. These combined efforts enhance our organizational resilience and position us for sustainable, long-term growth.

Over the next few years, your Company aims to accelerate its growth across all industry verticals it serves. Your Company has enhanced its focus on growing its Embedded Systems business and Aerospace business, in addition to keeping the momentum of automotive growth. A strategic emphasis will be placed on the Top accounts, with dedicated account teams to drive engagement and deliver value. Enhancing large deals will be a priority, with a customer segment-focused approach targeting OEMs, suppliers, off-highway, commercial vehicles and aerospace sectors. Additionally, we seek to achieve substantial revenue growth from partnerships. Leveraging a global delivery, AI and tech-led delivery model, your Company remains committed to a long-term, customer-obsessed and results-oriented strategy.

Financial performance

The discussions in this section relate primarily to the consolidated financial statements pertaining to the year that ended on March 31, 2025. The Consolidated financial statements of Tata Technologies Limited (your Company) are prepared in accordance with the Indian Accounting Standards (referred to as Ind AS) prescribed under section 133 of the Companies Act, 2013, read with the Companies (Indian Accounting Standards) Rules, as amended from time to time. Significant accounting policies used in the preparation of the financial statements are disclosed in the notes to the consolidated financial statements.

The financial statements of your Company and its subsidiaries have been consolidated on a line-by-line basis by adding together like items of assets, liabilities, income, expenses, after eliminating intra-group transactions and any unrealized gains or losses in accordance with the Indian Accounting Standard - 110 on Consolidated Financial Statements (IND AS 110).

FY 2024-25 your Company has delivered a resilient set of results despite navigating a challenging geopolitical environment marked by headwinds, shaped by shifting trade alliances, rising protectionism, tightening export controls and the ongoing reconfiguration of global supply chain. The following presents an overview of the consolidated financial results of your Company.

Consolidated financial review ( J crore)

Revenue from operations

FY 2024-25	5,168.45
FY 2023-24	5,117.20
Operating EBITDA
FY 2024-25	934.05
FY 2023-24	941.28
Profit Before Tax (PBT)
FY 2024-25	921.40
FY 2023-24	932.05
Tax Expenses
FY 2024-25	244.45
FY 2023-24	252.68
Profit After Tax (PAT)
FY 2024-25	676.95
FY 2023-24	679.37

Revenue from operations

Your Company derives revenue principally from Services business to clients from automobile, industrial heavy machinery and aero industry and Technology solutions. Your Companys revenue increased by 1.0% to C5,168.45 crore for FY 2024-25 from C5,117.20 crore for FY 2023-24, reflecting a broad-based growth across all major markets, other than rest of the world which witnessed a decline in revenue. The reported growth rate reflects the impact of the successful completion of a significant turnkey vehicle program in FY 2023–24 for one of our clients, excluding which, the underlying business demonstrated a robust 12% growth, underscoring the continued momentum in our core operations and the strength of our diversified customer portfolio.

Geographical revenue

Geographically, your Company experienced significant revenue growth across its key markets in India, Europe, and North America, with a notable degrowth in the rest of the world. Revenue in India surged by 12.7%, attributed to increased engagements with automotive anchor clients and growth in the Technology Solutions business. Similarly, revenue from Europe and North America witnessed substantial increases, driven by strengthened relationships and enhanced engagements in both the automotive and non-automotive sectors. However, revenue from the rest of the world was impacted due to the successful completion of large turnkey vehicle programs for a SEA-based OEM in FY 2023-24. The following graphs illustrates our revenue by geography as a percentage of revenue from operations.

India

FY 2024-25	40.1%
FY 2023-24	36.0%
UK
FY 2024-25	28.7%
FY 2023-24	24.2%
North America
FY 2024-25	21.2%
FY 2023-24	20.4%
Rest of Europe
FY 2024-25	6.5%
FY 2023-24	5.0%
Rest of the world
FY 2024-25	3.4%
FY 2023-24	14.5%

Segmental performance

Your Companys reportable segments are Services and Technology Solutions. The following graphs provide the Companys Segmental revenue (H Crore) and corresponding margins (as percentage).

Segmental revenue

Total

FY 2024-25	5,168.45
FY 2023-24	5,117.20
Services
FY 2024-25	4,027.36
FY 2023-24	3,982.61
Technology Solutions
FY 2024-25	1,141.09
FY 2023-24	1,134.59
Segmental margins
Total
FY 2024-25	29.3%
FY 2023-24	28.4%
Services
FY 2024-25	32.4%
FY 2023-24	31.5%
Technology Solutions
FY 2024-25	18.2%
FY 2023-24	17.5%

Services segment

The services business primarily comprises Engineering

& Design Services and Digital enterprise services to automotive and non-automotive customers across geographies. Your Company continued to win new business with its Anchor accounts and non-Anchor accounts. Your Companys revenue attributable to the Services segment increased by 1.1% to H4,027.36 crore for FY 2024-25, from H3,982.61 crore for FY 2023-24. The segment margin for the

year improved to 32.4% from 31.5% for FY 2023-24 due to disciplined cost controls, improving utilisation and increasing offshoring revenue.

Within our product engineering segment, we continued to see healthy trends across our software-defined products and services offerings. Within our Digital Engineering lines of service, demand remained strong in the areas of digital thread, smart manufacturing and customer experience solutions. The growing interest in digital thread reflects our clients need for seamless integration across the entire product life cycle, enabling greater visibility and operational efficiency. In smart manufacturing, companies are increasingly adopting our solutions to optimize production processes and enhance agility. Additionally, customer experience solutions remain a priority as our business looks to leverage digital tools to deliver personalized, frictionless interactions Our customer base continues to strengthen with 44 clients now contributing over million dollars annually, up from 41 in FY 2023-24. This growth reflects the deepening of our relationships and the increasing trust our customers are placing in us.

Technology solutions

The Technology solution business comprises revenue from academia upskilling and reskilling solutions and value-added reselling of software applications and solutions. During the year, your Company continued to win large deals with various state Governments in India. Your Companys revenue attributable to the Technology Solutions segment increased by 0.6% to H1,141.09 crore for FY 2024-25, from H1,134.59 crore for FY 2023-24. The segment margin for the year improved to 18.2% from 17.5% for FY 2023-24 due to improved margins in our education business and cost optimization The tepid growth in our Tech Solutions business was driven by a moderate reduction in discretionary spend by our customers that impacted our Product business, and the infrastructure readiness challenges within several state ITIs in India, which impacted our ability to execute against the growing education order book.

Expenses management

Amid a challenging macroeconomic environment and evolving client priorities, we maintained a sharp focus on operational excellence and cost optimization, through disciplined cost controls, enhanced delivery utilisation and an accelerated shift towards offshore delivery models, we successfully managed our expenses while strengthening execution efficiency. These actions enabled us to expand, margins across both segments. Our strategic investments in automation, talent reskilling, and digital delivery capabilities further enhanced productivity and positioned us to respond with agility to client needs. Your Company is committed to

The following graphs illustrates our expenses as a percentage of revenue from operations

Purchases of technology solutions

FY 2024-25	17.4%
FY 2023-24	17.5%
Outsourcing and consultancy charges
FY 2024-25	7.6%
FY 2023-24	9.9%
Employee benefits expense
FY 2024-25	48.2%
FY 2023-24	46.2%
Finance costs
FY 2024-25	0.4%
FY 2023-24	0.4%
Depreciation and amortisation expense
FY 2024-25	2.3%
FY 2023-24	2.1%
Other expenses
FY 2024-25	8.8%
FY 2023-24	8.0%

leveraging its global delivery model, optimizing operational costs while investing in strategic initiatives to drive long-term value creation.

Purchase of technology solutions, which includes purchase of information technology equipment, software and other products for academia upskilling and & reskilling solutions and purchase of third-party software licenses for value added reselling of software applications and solutions, amounted to H899.71 crore in FY 2024-25, an increase of 0.5% YoY. This was in-line with the revenue growth witnessed in the Technology solutions segment in FY 2024-25.

Outsourcing and consultancy charges, which include cost of direct contractors and agency contractors to support current and future business growth, amounted to H390.42 crore for FY 2024-25 making a 23.2% decline compared with H508.36 crore in FY 2023-24 as we minimized our reliance on subcontracting during the year.

Employee benefits expense, which includes salaries, wages and bonus, contribution to provident fund and other funds, share based payment to employees and staff welfare costs, amounted to H2,488.93 crore for FY 2024-25 marking a 5.3% increase compared with H2,363.72 crore in FY 2023-24. Despite a marginal 0.3% year-on-year decline in headcount, from 12,688 as of March 2024 to 12,644 as of March 2025, the rise in employee expenses was primarily driven by wage hikes implemented during the year. Finance costs which include interest on lease liabilities and other interest cost amounted to H19.63 crore for FY 2024-25 marking a 3.8% increase compared with H18.91 crore for FY 2023-24.

Depreciation and amortization expenses for FY 2024-25 stood at H121.21 crore compared with H105.87 crore for the FY 2023-24. Out of the total expenses, expense pertaining to depreciation on right to use assets for FY 2024-25 stood at H50.95 crore as against H43.10 crore for the FY 2023-24. Amortization of intangible assets amounted to H22.06 crore for FY 2024-25 compared with H17.09 crore for FY 2023-24. Other expenses comprise expenses like rent, repairs & maintenance, travelling expenses, software & AMC charges, professional charges, and miscellaneous changes among others. Other expenses for the FY 2024-25 stood at H455.34 crore, marking an increase of 11.5% compared H408.51 crore for the FY 2023-24. The increase in cost was largely driven by an increase in travelling & conveyance expenses, software and AMC charges and professional fees.

Other income

Other income includes interest income, other gains and losses and other non-operative income Interest income mainly consists of interest received on bank deposits and intercompany deposits. Other gains and losses consist of changes to fair value of investments, derivatives and contractual financial asset.* Other non-operative income includes credit taken on account of research & development expenditure, foreign exchange gain / loss, lease income, gain / loss on disposal of investment, deferral income on account of unwinding of liability towards fair valuation of financial asset.* Your Companys other income has increased by 7.4% to H124.13 crore for FY 2024-25 from H115.55 crore for FY 2023-

24 contributed by higher interest income from improved yield on increased cash generation, fair value gain on the options relating to our investment in the BMW Joint Venture* and partly offset by lower R&D income earned in our UK operations due to change in rules

Tax expenses

The tax expenses decreased by 3.3% to H244.45 crore for FY 2024-25 from H252.68 crore for FY 2023-24, primarily due to change in profits mix in various jurisdictions. The effective tax rate has decreased from 27.1% for the previous year to 26.5% for the current year. This is mainly due to a one-time impact of deferred tax charge in India due to the transition to the new tax regime in the previous year. Effective tax rate is generally influenced by various factors, including differential tax rates, non-deductible expenses, exempt non-operating income, overseas taxes, tax reversals and provisions pertaining to prior periods.

Profitability

Your Companys Operating EBITDA stood at H934.05 crore for FY 2024-25 as compared to H941.28 crore for FY 2023-24. The Operating EBITDA margin for the year stood at 18.1% as compared to 18.4% for FY 2023-24. FY 2024-25 represents the fourth consecutive year of margins exceeding 18%. Share of profit of equity accounted investee (net) is the Share of Profit in the BMW Joint Venture formed during the year stood at H4.06 crore for FY 2024-25.

Profit after Tax for the year decreased by 0.4% to H676.95 crore for FY 2024-25 from H679.37 crore for FY 2023-24. Profit After Tax margin for the year stood at 13.1% as compared to 13.3% for FY 2023-24.

Liquidity

Your Company maintains a strong liquidity position, primarily relying on cash generated from operating activities to fulfil its working capital and capital expenditure requirements. As of March 31, 2025, your Company remains debt-free, with adequate cash reserves and other liquid assets to meet its short-term obligations and fund future growth initiatives. Your Companys billed days sales outstanding (DSO) of 54 days and unbilled DSO of 27 days reflect its commitment to maintaining a healthy cash conversion cycle and minimizing the risk of overdue receivables. By closely monitoring and managing its working capital components, Tata Technologies ensures adequate liquidity to sustain its operations and drive growth.

Key financial ratios

Particulars	Unit	FY 2024-25	FY 2023-24
Employee benefit expenses /Revenue from operations	%	48.2	46.2
Total Expenses (excluding interest & depreciation) / Revenue from operations	%	81.9	81.6
Operating EBITDA (Before Other Income) / Revenue from operations	%	18.1	18.4
Effective Tax Rate \u2013Tax expenses /Profit Before Tax	%	26.5	27.1
Profit for the year / Revenue from operations	%	13.1	13.3
Days Sales Outstanding (DSO)	Days	81	83
Current Ratio	Times	1.74	1.87
Debt (excluding lease liabilities) Equity Ratio	Times	-	-
Return on Net Worth (%)	%	19.9	21.9
Earnings Per Share (EPS)- Basic	C	16.69	16.75
Dividend Per Share	C	11.70 *	10.05

*Proposed final dividend of C 8.35 per share and special dividend of C 3.35 per share subject to approval by shareholders in the AGM.

Human resources

Your Company believes that its people are its most valuable asset and the key drivers of innovation, growth and operational excellence. The Human Resources (HR) function at your Company continues to play a strategic role in building a future-ready workforce that is agile, diverse and aligned with the evolving needs of the business. Through a strong emphasis on employee development, engagement, and well-being, your Company is promoting a high-performance and inclusive culture across its global operations.

During the year, your Company continued to invest in talent development through targeted upskilling initiatives, leadership development programs and digital competency-building. These efforts are designed to support growth in emerging technologies and build a resilient, adaptable workforce. Talent retention, diversity and inclusion, and employee engagement remained focus areas, supported by a robust framework of policies, programs, and platforms designed to empower individuals and teams.

Your Company is also committed to providing a safe, collaborative, and inclusive work environment where employees feel valued and motivated to contribute meaningfully to organisational goals. By prioritising employee well-being and engagement, your Company strengthens its foundation for long-term success and sustainable growth.

Employee headcount
FY 2024-25	12,644
FY 2023-24	12,688
Global attrition rate
FY 2024-25	13.2%
FY 2023-24	14.5%

For more details, please refer to page number 74 of this Annual Report

Corporate social responsibility

Your Company remains deeply committed to its responsibility towards society and the environment. Guided by the Tata Groups legacy of purpose-driven business, your Company continues to pursue its vision of engineering a better world not only through its solutions but also through its community engagement and sustainability initiatives. CSR remains a key pillar of your Companys long-term strategy. The CSR approach of your Company focuses on creating a meaningful impact in the areas of education, skill development, environmental sustainability and community welfare.

During the year, your Company continued to contribute to various initiatives that promote equitable access to opportunities, enhance employability and support environmental stewardship. These efforts are designed to meet compliance requirements and make a genuine differenceinthecommunitieswhereyourCompanyoperates.

For more details, please refer to page number 82 of this Annual Report

Internal control systems and their adequacy

Your Company has a robust internal control mechanism in place commensurate with the size and nature of its business. The internal control systems comprising policies and procedures are designed to ensure that operations are efficiently managed and aligned with the strategic objectives of your Company and address various aspects of governance, compliance, audit, control and reporting. The internal controls are responsible for complying with the regulatory requirements, preventing fraud and errors, safeguarding your Companys assets and finances, and preserving the accuracy and reliability of financial transactions and reporting. Your Company maintains an adequate internal control system, which provides, among other things, reasonable assurance of recording the transactions of its operations in all material aspects and of providing protection against significant misuse or loss of Companys assets. Your Companys internal audit committee periodically reviews the adequacy of the internal control systems. Key observations and recommendations are communicated to the management, who takes appropriate corrective measures as deemed fit to maintain the efficiency and effectiveness of the internal controls.

Cautionary statement

The Management Discussion and Analysis may contain some statements describing your Companys objectives, plans, projections, outlook, estimates, expectations and others which may constitute forward-looking statements within the meaning of applicable securities laws and regulations and are based on informed judgments and estimates. Actual results may differ materially from those expressed or implied due to external and internal factors beyond your Companys control. Your Company does not undertake any obligation to publicly amend, modify or revise these forward-looking statements based on subsequent developments, information or events.