Indian engineering firm Tata Tech’s profit rises on non-core business boost

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(Reuters) -Indian engineering firm Tata Technologies reported a 5% rise in second-quarter profit on Friday, as growth in its non-automotive business cushioned weakness in its key auto-focused segment.

The firm, which provides engineering, product design and manufacturing digitalisation services to automotive clients, as well as to aerospace and industrial machinery firms, warned about near-term demand being tepid.

Engineering research and development firms like Tata Technologies, which depend heavily on outsourcing work from U.S. and European clients, have been under pressure as automotive clients cut back on investments and R&D spending reeling from the impact of U.S. tariffs, according to analysts.

Revenue from its bigger services segment, which makes up 77% of overall revenue, remained flat. Revenue in its smaller technology solutions segment — which provides digital engineering, upskilling solutions, and enterprise IT services — rose 6.6% during the quarter.

Their overall revenue rose 2% to 13.23 billion rupees ($150.3 million) in the three months to September end.

The company, which counts Jaguar Land Rover and Tata Motors among its largest clients, said its consolidated net profit rose to 1.66 billion rupees from 1.57 billion rupees a year earlier.

“While we may see some short-term, tactical challenges in Q3, we remain confident in a solid rebound in Q4, supported by a robust pipeline, improving demand trends, and continued operational excellence,” CEO Warren Harris said in a statement.

($1 = 88.0120 Indian rupees)

(Reporting by Aleef Jahan; Editing by Subhranshu Sahu and Mrigank Dhaniwala)