Tata Technologies Q4 FY26: Revenue Up 15.1% QoQ, Margin Expands to 16.0%
Tata Technologies reported Q4 FY26 operating revenue of ₹1,572.22 crore, up 15.1% QoQ, with EBITDA margin expanding to 16.0%. FY26 consolidated revenue stood at ₹5,505.57 crore, net profit at ₹546.59 crore. The Board recommended final dividend of ₹8.35 and special dividend of ₹3.35 per share. Key wins include Japanese OEM full vehicle program and European luxury OEM PLM transformation. Management targets double-digit organic growth by FY27.
*this image is generated using AI for illustrative purposes only.
Tata Technologies has reported its audited consolidated financial results for the fourth quarter and full year ended March 31, 2026, approved by the Board of Directors at its meeting held on May 4, 2026. The company posted consolidated revenue from operations of ₹5,505.57 crore for FY26, compared to ₹5,168.45 crore in FY25, reflecting a year-on-year increase. For Q4 FY26, total company operating revenue stood at ₹1,572.22 crore, up 15.1% quarter-on-quarter. Services segment revenue reached ₹1,219.61 crore, up 15.0% QoQ, or $132.6 million in constant currency terms, up 11.9% QoQ.
Operating EBITDA for Q4 FY26 was ₹252.10 crore, up 30.7% QoQ, with EBITDA margin expanding to 16.0% from 14.1% in the previous quarter. Adjusted net income for Q4 FY26 was ₹162.50 crore, up 20.3% QoQ, with net income margin at 10.3%, up 45 basis points QoQ. Q4 margins exclude one-time exceptional reversal due to new labor code provisions. The company's workforce strength stood at 12,646, with last twelve months attrition at 16.2%.
Consolidated Financial Performance
The following table presents the key consolidated financial metrics for the quarter and year ended March 31, 2026:
| Metric: | Q4 FY26 | Q4 FY25 | FY26 | FY25 |
|---|---|---|---|---|
| Revenue from Operations (₹ crore): | 1,572.22 | 1,285.65 | 5,505.57 | 5,168.45 |
| Total Income (₹ crore): | 1,603.18 | 1,342.73 | 5,680.12 | 5,292.58 |
| Total Expenses (₹ crore): | 1,382.62 | 1,088.20 | 4,831.69 | 4,375.24 |
| Profit Before Tax (₹ crore): | 283.33 | 258.09 | 764.72 | 921.40 |
| Net Profit (₹ crore): | 204.17 | 188.87 | 546.59 | 676.95 |
| Basic EPS (₹): | 5.03 | 4.66 | 13.47 | 16.69 |
| Diluted EPS (₹): | 5.03 | 4.65 | 13.47 | 16.66 |
For FY26, total income stood at ₹5,680.12 crore against ₹5,292.58 crore in FY25. Net profit for the full year was ₹546.59 crore compared to ₹676.95 crore in the previous year. Employee benefits expense, the largest cost component, rose to ₹2,737.42 crore in FY26 from ₹2,488.93 crore in FY25. Total comprehensive income for FY26 was ₹812.65 crore, compared to ₹757.28 crore in FY25.
Segment-Wise Performance
The company operates through two reportable segments — Services and Technology Solutions. The Services segment covers outsourced engineering, designing, and digital transformation services to global manufacturing clients, while the Technology Solutions segment encompasses academia upskilling and reskilling solutions and value-added reselling of software applications.
| Segment Revenue (₹ crore): | Q4 FY26 | Q4 FY25 | FY26 | FY25 |
|---|---|---|---|---|
| Services: | 1,219.61 | 1,024.07 | 4,256.30 | 4,027.36 |
| Technology Solutions: | 352.61 | 261.58 | 1,249.27 | 1,141.09 |
| Total: | 1,572.22 | 1,285.65 | 5,505.57 | 5,168.45 |
| Segment Results (₹ crore): | Q4 FY26 | Q4 FY25 | FY26 | FY25 |
|---|---|---|---|---|
| Services: | 357.24 | 347.53 | 1,231.81 | 1,303.91 |
| Technology Solutions: | 70.49 | 51.16 | 231.91 | 208.02 |
| Total: | 427.73 | 398.69 | 1,463.72 | 1,511.93 |
Exceptional Items and Labour Code Impact
The FY26 results include exceptional items totalling ₹107.73 crore for the full year. These comprise ₹83.74 crore arising from the statutory impact of new Labour Codes — specifically, incremental provisions for gratuity of ₹56.82 crore and long-term compensated absences of ₹26.92 crore due to a change in wage definition — following the Government of India's notification of four Labour Codes on November 21, 2025, consolidating 29 existing labour laws. Additionally, acquisition-related costs of ₹23.99 crore pertaining to the Es-Tec GmbH business combination have been included as exceptional items given their material and non-recurring nature.
Es-Tec GmbH Acquisition
During FY26, Tata Technologies, through its wholly owned subsidiary Tata Technologies Pte Ltd (Singapore), completed the 100% acquisition of Es-Tec GmbH, Germany, and its subsidiaries (collectively, the Es-Tec Group), which specialise in high-end automotive engineering services with expertise in ADAS, Connected Driving, and Digital Engineering. The acquisition was completed on November 27, 2025, and the Es-Tec Group has been consolidated into the Group's financial statements starting December 1, 2025.
| Acquisition Details: | Particulars |
|---|---|
| Target: | Es-Tec GmbH, Germany and subsidiaries |
| Completion Date: | November 27, 2025 |
| Fixed Consideration: | €51.4 million (₹532.10 crore) |
| Variable Consideration: | Up to €14.6 million (₹151.77 crore) over next 2 years |
| Goodwill Recognised: | ₹406.72 crore |
| Customer-Related Intangibles: | ₹365.32 crore |
| Acquisition Financing: | US$60M long-term bank borrowing (5-year repayment) |
To fund the acquisition, Tata Technologies Pte Ltd raised a long-term bank borrowing of US$60M on November 26, 2025, repayable over the next five years, with a financial corporate guarantee provided by the holding company, Tata Technologies Ltd.
Key Customer Wins and Recognitions
Tata Technologies secured several strategic engagements during the period. The company won a multi-year, multi-million-dollar full vehicle engineering program with a leading Japanese automotive OEM, marking a scaled entry into the Japanese market. A European luxury automotive OEM selected Tata Technologies to own their enterprise PLM Service Transformation and operations across all product domains including Engineering, Manufacturing, supply chain, purchasing and IDT. Additionally, a Tier 1 automotive supplier engaged the company for a superscale Global Engineering Centre mandate, and a North American commercial vehicle OEM partnered for end-to-end services across PLM, Testing & QA, MES, and program management.
Dividend Declaration
Alongside the results, the Board recommended a final dividend of ₹8.35 per share and a one-time special dividend of ₹3.35 per share, aggregating to ₹11.70 per equity share of ₹2 each for FY26, subject to shareholder approval at the Annual General Meeting. If approved, the total dividend payout would result in a cash outflow of approximately ₹475.00 crore.
Standalone Financial Highlights
On a standalone basis, Tata Technologies reported revenue from operations of ₹3,125.50 crore for FY26 compared to ₹3,024.47 crore in FY25. Standalone net profit for FY26 stood at ₹570.41 crore against ₹849.12 crore in the previous year. Other income for FY26 includes ₹150.83 crore received as dividend from a subsidiary company, compared to ₹390.01 crore in FY25. Standalone basic EPS for FY26 was ₹14.06 versus ₹20.93 in FY25.
| Standalone Metric: | FY26 | FY25 |
|---|---|---|
| Revenue from Operations (₹ crore): | 3,125.50 | 3,024.47 |
| Net Profit (₹ crore): | 570.41 | 849.12 |
| Basic EPS (₹): | 14.06 | 20.93 |
| Diluted EPS (₹): | 14.05 | 20.90 |
Balance Sheet and Cash Flow
As at March 31, 2026, consolidated total assets stood at ₹8,953.46 crore compared to ₹6,664.23 crore as at March 31, 2025. Total equity increased to ₹3,923.37 crore from ₹3,579.42 crore. Goodwill on the consolidated balance sheet rose significantly to ₹1,351.25 crore from ₹818.09 crore, primarily reflecting the Es-Tec acquisition. Net cash generated from consolidated operating activities for FY26 was ₹775.70 crore, compared to ₹699.25 crore in FY25. Cash and cash equivalents at the end of FY26 stood at ₹682.34 crore.
Management Outlook
Management has outlined targets for double-digit organic growth by FY27, along with expectations of a steady margin increase through FY27. Warren Harris, Chief Executive Officer and Managing Director, stated that the momentum built in Q3 carried through to Q4, delivering 12% revenue growth in constant currency and 190 bps margin expansion, marking a clear inflection for the business with broad-based growth. Uttam Gujrati, Chief Financial Officer, highlighted strong revenue growth, meaningful margin expansion, and robust free cash flow generation. The Board also noted changes in senior leadership, with Mr. Raghav Mulay assuming the role of Company Secretary effective April 14, 2026, and Mr. Dhiman Gupta appointed as a Non-Executive Non-Independent Director effective January 16, 2026. The audited results carry an unmodified opinion from statutory auditors B S R & Co. LLP.
Historical Stock Returns for Tata Technologies
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +0.16% | -0.13% | +9.41% | -13.80% | -11.12% | -54.91% |
How will the full-year integration of Es-Tec GmbH impact Tata Technologies' ADAS and connected driving revenue mix in FY27, and can the acquisition justify its €66 million total consideration through synergy realization?
Given that net profit declined ~19% YoY in FY26 despite revenue growth, what specific cost levers beyond operating leverage does management plan to deploy to achieve sustainable margin expansion in FY27?
With the Japanese automotive OEM win marking a scaled entry into the Japanese market, how significant could Asia-Pacific become as a revenue contributor relative to the current European and North American client base over the next 2-3 years?
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