Tata Electronics makes mobile parts worth Rs 463 crore in FY23 - ETTelecom

In its filings to the Registrar of Companies (RoC), the company said most of the technologies used for the production are new to India and it has now built indigenous capability around these technologies.

Updated On Sep 13, 2023 at 07:42 AM IST

Read by: 100 Industry Professionals

Tata Group, which started operations of its electronics contract manufacturing unit last year, produced mobile phone parts worth Rs 463 crore in 2022-23, regulatory disclosures by Tata Electronics show.

Tata Electronics is a newly floated entity in the electronics manufacturing services (EMS) space, competing against the likes of Foxconn and Dixon.

"This is expected to help India establish its mark in EMS ecosystem, which in turn is expected to open up a number of avenues for employment," it said in the report.

The company said it is manufacturing mobile enclosures.

An industry executive said mobile enclosure is the outer mechanical part in which electronics and various modules of the mobile phone are housed.

Tata Electronics reported a nloss of Rs 531 crore in FY23, which experts attributed to its formative period.

"The company is currently in its nascent stage, experiencing rapid growth while contending with fixed overheads such as employee salaries and asset depreciation, which are impacting its bottom line," said Mohit Yadav, founder of business intelligence firm AltInfo. "Strong execution and the establishment of a track record are essential factors to watch as they will determine the company's direction moving forward," he said.

An email sent to Tata Electronics remained unanswered till Tuesday press time.

ET had earlier reported that Tatas have lined up funds of more than Rs 7,600 crore for Tata Electronics through a mix of capital infusion and secured loans. Last fiscal, the company received more than Rs 608 crore in capital infusion from its holding company Tata Sons. This capital infusion was the highest in a financial year and took the total investment by the parent to Rs 1,820 crore.

There have been no RoC filings on fresh capital infusion by the parent till now this fiscal.

As of March, Tata Electronics had an outstanding external term debt of Rs 3,829 crore, which comprised bank debt of Rs 3,293 crore and loan of Rs 536 crore from State Industries Promotion Corporation of Tamil Nadu, as per RoC filings.

During FY23, the company also tied up a foreign currency loan of $50 million for capacity expansion activity.

"Further, out of the outstanding rupee term loan of Rs 783 crore, the company novated Rs 587.25 crore rupee term loan with a foreign currency loan of $71.16 million during the year under review," Tata Electronics said in the RoC filing. "The company also availed working capital limits (interchangeable between fund based and non-fund based) of Rs 250 crore. Further, the company had availed a PO financing facility with utilisation of Rs 299 crore. The working capital (fund based) limits utilised was Rs 103 crore," it said.