The consideration for the acquisition will be paid over the next two years, and also includes performance-based payouts.
Analysts believe that ES-Tec will contribute nearly 8% to Tata Technologies’ topline going forward.Tata Technologies believes that the acquisition enhances the company’s engineering, R&D, ER&D capabilities, particularly within next-generation mobility technology.
This will also boost Tata Technologies’ presence in Germany, with access to strong talent in systems engineering.There are also potential synergies for cross-selling, leveraging complementary customer bases and tapping into OEM accounts.
“ES-Tec’s technical depth, customer centricity, and regional strength align perfectly with our strategic vision to be the first partner choice for global OEMs navigating the shift towards intelligent, connected, and sustainable mobility,” Warren Harris, MD & CEO of Tata Technologies said.
The acquired company is into the business of providing high-end automotive engineering services, with deep expertise in Advanced Diver-Assistance Systems (ADAS), connected driving and digital engineering.
Brokerage firm JPMorgan believes that Tata Tech’s revenue is expected to decline by 4.6% in constant currency terms and margins will narrow by 100 basis points in financial year 2026, which does not justify a 37 times one-year forward price-to-earnings multiple.
Therefore, JPMorgan remains “underweight” on Tata Technologies with a price target of ₹570.
Shares of Tata Technologies are trading 2% higher on Monday at ₹716.35. The stock is down 21% so far in 2025, down 50% from its all-time high of ₹1,400, but above its IPO price of ₹500.
