Tata Group Company, Tata Technologies is a global leader in engineering services outsourcing and product development IT services to the global manufacturing industry; enabling ambitious manufacturing companies to design and build better products. Tata Technology is the company of innovators, specialists in the design engineering space, which applies cutting-edge technology to provide a competitive advantage to customers in the manufacturing sector. Tata Technologies is headquartered in Singapore, with regional headquarters in the United States (Novi, Michigan), India (Pune) and the UK (Warwick) with a combined global workforce of more than 8,500 employees serving clients worldwide from facilities in North America, Europe, and the Asia-Pacific region. Yesterday, they have provided an Annual Report for the FY19-20 to all the shareholders. UnlistedZone.com being the shareholder also gets one. Let us analyze how Tata Technology has performed in FY19-20. FY19-20 Business Analysis 1. FY19-20 was quite challenging for Tata Technology. Falling vehicle sales and push towards ACES( Autonomous, Connected, and Electric Shared) has pushed clients of Tata Technology to reduce costs. We know 80% of Tata Technology revenue comes from the global automotive sector, the problem in that sector has impacted the overall growth of the company. 2. However, despite the problems, Tata Technology has earned a revenue of 2852 Cr in FY20, a tad lower as compared to last year where they earned 2984 Cr. The company has made operating margins of 16% in FY20. EPS of FY19-20 stands at 60 per share. 3. As per management commentary, Tata Technology has seen revenue growth of 4.4% and operating profit growth of 32% QoQ basis in the last quarter of FY20. This has achieved due to the operational efficiency program that resulted in saving ~100 Cr in FY19-20. 4. In FY19-20, Tata Technology has participated in the Electric Vehicle event in China to showcase its product called EVMV( Electric Vehicle Modular Platform). This product helps OEMs of EV to reduce costs in manufacturing. 5. Tata Technology partners with PTC to provide smart manufacturing and digital solutions to manufacturing industries worldwide. So they are focussing more revenue contributions from the digital segment going forward. Future Planning 1. Tata Technology is looking to align its business portfolio with new markets and opportunities. They are doing investment in embedded electronics, digital, and software segments. 2. Last year they build the project called Autostar (Automotive Open System Architecture) for a major tier-1 automotive supplier. 20% of service business revenue comes from Digital now. 3. Tata Technology is looking to diversify its client base to grow in adverse situations. In FY19-20, the company has shown strong growth in North-America and India, however, over-dependence upon the automotive sector, especially specific clients in UK, Sweden, and China has impacted the business. Last 5 years Financial Performance of Tata Technology  Key Financial Takeaways in FY19-20 1. Tata Technology has recorded a decrease in revenue from operations by 3.1%. The revenue from operations decreased to ₹ 2,852.05 crores during the financial year 2019-20 compared to ₹ 2,942.21 crores during the previous year. 2. The Profit after Tax (PAT) decreased by 28% to ₹ 251 crores in the financial year 2019-20 compared to ₹ 352 crores during the previous financial year. 3. EPS stands at 60 per share. 4. Tata Technology has recommended a given dividend of 40 per share in Fy19-20. This converts into a dividend yield of 3.6% at CMP of 1100 per share. 5. Currently, Tata Technology Unlisted share is available at P/E of 18 based on FY19-20 numbers. For more details about Tata Technology, click here.