38 ‘Million-Dollar’ Contribution

we expect revenues to start to flow towards the end of this year.”

38 ‘Million-Dollar’ Contribution-There has been negative news on one of your clients VinFast after its share price plunged 90% from highs. We are very proud of our association with VinFast and the Vin Group. We have had the opportunity to partner with them in the last couple of years to develop two of the electric vehicles that they are launching and delivering to customers, not just in Vietnam but in different par parts of the world.

38 ‘Million-Dollar’ Contribution-As with many new energy vehicle companies, when they develop vehicles, they shift their focus towards building vehicles and generating recognition and interest in their brand. With VinFast, we would expect a slight dip in revenues over the next 12, 18 months. But that company is positioned for success and we fully expect to be part of that.

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38 ‘Million-Dollar’ Contribution Overview-

Overall, about the client diversification itself, because of course Tata Motors, the anchor client, is also something which has been much talked about. What are you doing in terms of increasing the number of clients because the top five form almost 70% of the revenue?

38 ‘Million-Dollar’ Contribution-Yes, but 10 years ago, both Tata Motors and JLR made up the majority of our services. And last year, at an aggregate revenue level, Tata Motors and JLR made up less than 33% of our revenue mix. If you look atthe number of million-dollar accounts that we have contributing towards our revenue mix, some three years ago, it was 28 companies.

38 ‘Million-Dollar’ Contribution- Two years ago, there were 33 companies. And last year, the number was 38. So we are working very hard from a business development perspective to deliver value to existing customers but also to complement the existing portfolio of customers with new logos that have the ability and have the capacity to scale with the ambitions of growth that we have for our company.

38 ‘Million-Dollar’ Contribution Peoples Comment:

I was looking at the margin profile. For you, the margins stand at around 18-19% thereabouts, whereas your competitor, the likes of KPIT, are limited to 10% margins. What explains the higher margin that you are able to drive and going forward?
38 ‘Million-Dollar’ Contribution-Well, I think our margins if you look in detail, are very comparable with KPIT. But if you look at our business model, it is somewhat different from KPIT and companies like Tata Elxsi. We are focussed upon the end-to-end coverage of the automotive value chain and what that requires is a healthy balance between onshore capabilities and offshore capabilities.

Our onshore-offshore ratios today are about 50-50 in terms of revenue. We fully expect to be able to improve that to about 65% to 70% of our revenues coming from offshore services. 38 ‘Million-Dollar’ Contribution-Not really going to comment on the margin target that we got for the business.

I would just say that we believe we are in a great area. We believe the global ER&D market will continue to grow in double digits. We expect to meet or exceed the overall market growth rate given our market position and the differentiated value proposition we represent.

Therefore, we are very optimistic about the future. We are very optimistic about the overall market and we certainly expect the contribution of Indian-based ER&D companies to the global manufacturing sector.

Also a word on the outlook for the aviation sector. Of course, you have recently tied up with Airbus, if you look at the India business and your group company, the overall sector ordering seems to be quite high. Overall, what is the outlook on the aviation sector?

38 ‘Million-Dollar’ Contribution-We’re really excited and very excited about the work we’re doing in aerospace. We were empaneled by Airbus about 18 months ago. We are opening offices in Toulouse and Hamburg, rolling out IT systems, obtaining various accreditations at Airbus, which has now increased our capacity to fulfill a relatively large order book that we have created for Airbus And so we expect revenue. , Inflows will begin by the end of this year and of course we expect Airbus’s contribution to improve rapidly next year.

38 ‘Million-Dollar’ Contribution-The point made is, the group is also investing in the acquisition of Air India, the purchase of 470 single-aisle and wide-body aircraft, providing the tailwind that we expect and so we are excited about that business that we are managed directly. We are also excited to be able to complement the Group’s investment and growing influence in the global aerospace sector.

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