Tata Technologies sees a market rebound after a period of paused decisions, not a decline in demand.

While margins were compressed and temporary softness occurred due to a cybersecurity event, customer engagement remained strong, and diversification advanced with new global OEMs like BMW and Volkswagen.

Non-auto revenue contributed 19.9% in Q3 FY26, with services revenue targeting 10% sequential growth in Q4 FY26. Strategically, the company acquired Germany-based ES-Tec Group for up to €75 million (approx. 675 Cr), enhancing ADAS and Software-Defined Vehicle capabilities.

It is also integrating AI across its end-to-end vehicle development to accelerate product lifecycles.

Management expects client decision-making to restart, positioning the company for a strong rebound.

They anticipate a ~16.0% exit margin in Q4 FY26, driven by volume recovery, higher-value software/AI work, and full-vehicle program leverage.

Significant tailwinds are also expected from the multi-year transformations within the broader Tata Group in EVs, batteries, and aviation.