For a few years now, Tata Elxsi, a design software and system integration company owned by Tata Group, has been working towards carving a niche for itself through its tech capabilities and customer engagements.
The company, with its focus on technology services and embedded product design (EPD) in sectors like automotive, broadcast, communication and healthcare industries, has made a mark with its impressive growth during the last three years.
Tata Elxsi is working hard to increase its revenues from its existing operations to touch Rs 3,000 crore in the next two years. Analysts believe the target is achievable, going by the performance in the last three years.
In a recent earnings call, Chief Executive Officer Madhukar Dev said the company had targeted growing upwards of 20% year-on-year and got quite close to it.
"However, if you were to add that over the next few years, you will find that organically, we cannot get to Rs 3,000 crore from where we are. Obviously, there will have to be other events that will help us achieve the milestone," Dev said.
The auto sector is a focus area for the company as it contributes half of its revenues and the company invests heavily in the same. Tata Group company Jaguar Land Rover (JLR) is the largest contributor to its business and yields at least a fifth of its revenues.
Motilal Oswal Securities in its report states that the global R&D spends by the auto sector stand at $120 billion annually. "The outsourcing portion is about 10% and offshoring to India is around 0.4%, providing immense growth potential," the report said.
The report also states that software, which comprised 2% of total value of a vehicle in 2000, now comprises 15% of the total value and is expected to reach 20% by 2020. India will be a primary location for these activities as the destination is 40-50% cost savings.
Tata Elxsi Senior Vice President and Head of Marketing Nitin Pai says the company is aggressively exploring many advanced driver assistance systems (ADAS).
"During the 2017 CES, the company unveiled Autonomai - Tata Elxsi's autonomous vehicle middleware platform. This platform's sensor fusion algorithm combines inputs from Lidar and other sensors and leverages AI and deep learning to come up with various use-case scenarios of driverless cars. Now we have 17 original equipment manufacturers and 50 suppliers working with us in the automotive vertical," says Pai.
As part of the driverless and driver-assisted car initiative, the company has developed deep expertise in three verticals including the perception system (the eyes and ears of the vehicle made up of sensors and cameras), guidance navigation control system (analyses inputs and makes decisions on movements) and drive-by-wire system (helps in translating decisions into mechanical activities like braking, acceleration and wheel rotation).
Tata Elxsi's theme for this year is Artificial Intelligence (AI) + Design = Enabling the Driving Experience of the Future. This brings together the company's world-class AI and analytics practice, an award-winning HMI and design team, and SPICE Level 5 certified automotive engineering to drive solutions for the autonomous and connected cars of the future. The company now has around 3,500 employees working in the auto vertical.
Aviation and communication
The Airports Authority of India (AAI) has roped in Tata Elxsi to design information and technology guidelines for all upcoming AAI airports. The company will help AAI in setting up a team and create a process to design and implement customer-centric information and way-finding system, which will cover the entire passenger journey, right from parking to boarding the plane, the company said in a statement.
Tata Elxsi Chief Designer (Service Design) Narendra Ghate says that prior experience in redefining passenger experience for some leading airports in India has given Tata Elxsi an edge to bag the mandate.
The company has already commenced work across airports, including Goa, Kolkata, Varanasi and Lucknow. The other short-listed airports are Chennai, Bhubaneswar, Pune, Trivandrum, Coimbatore and Guwahati.
DiSTI Corporation, a leading provider of graphical user interface software and customised 3D virtual maintenance training solutions, announced a strategic partnership with Tata Elxsi to deliver DiSTI's GL Studio UI products with Tata Elxsi software services.
In the communication space, the company is working on software in software-defined networking (SDN). Tata Elxsi announced its association with Airtel as technology partner for system integration for Airtel's Internet TV. It developed and integrated key software components to ensure that the Android TV application suite provides a seamless user experience, whether the viewer accesses online or offline content.
This includes the OTA (Over the Air) upgrade module, a smart UI, customised Android TV launcher and software optimisation to future-proof the service.
Centre of Excellence
When asked about the changes brought out by digital, AI and machine learning, Pai said Tata Elxsi has carved out a branch called Next-Gen Business. As part of this strategy, the company has started a Centre of Excellence (CoE) in AI, IoT, AR/VR and automotive along with solid partners.
Tata Elxsi, in association with Unity Technologies - creator of end-to-end development platform used to create real-time interactive 2D, 3D, VR and AR experiences - launched a CoE to build opportunities for AR/VR areas by building the largest pool of Unity developers in India.
Unity reaches nearly three billion devices around the world, and is used to author more than two-thirds of all AR/VR content, while Tata Elxsi brings integrated expertise of combining design, technology and content development capabilities. The CoE will contribute to the continued growth that Unity has already seen across sectors, including architectural visualisation, film and entertainment, automotive, engineering and manufacturing, as well as government.
Tata Elxsi has teamed up with National Instruments to develop solutions targeted to specific automotive industry needs in autonomous driving, ADAS validation and HMI Validation for emerging features and use-cases. National Instruments has developed virtual instrumentation with the help of its Lab View graphical system design platform.
Merger likely with TCS
Tata Elxsi, which provides technology consulting, new product design, development, and testing services, is also under the radar of Tata Chairman N Chandrashekaran for a possible merger with TCS. Although the company did not reveal anything officially, the industry is rife with rumour of possible merger with TCS.