Thank you very much. We will now begin the question-and- answer session. The first question is from Ruchi M ukhija from ICICI Securities. Please go ahead.

Thank you for the opportunity. One of my first question is regarding the growth. We expect a sequential growth recovery in Q2. Is this on back of the 6 strategic deals that we have won, or do we see an uptick in business beyond these 6 deals as well?

Well, thanks for the question, Ruchi. We entered the fiscal year with a fair amount of momentum. There were deals that were closed in Q4 and certainly towards the end of the first quarter, we've added the 6 deals that we've just announced. So, it's really the order book that we're taking into Q2 and also the improved sentiment. I think the tariff concerns and the macroeconomic concerns that informed the softness at the beginning of the fiscal – they haven't fully dissipated, but we are seeing increased confidence that common sense will prevail, and the trade negotiations will provide an environment that will provide the sort of basis and confidence around which decisions can be made. So, our confidence in improvement in Q2 and the second half of the year is informed by the order book and also the engagement and sentiment that we're picking up from customers.

Got it. Secondly, in our non -auto segment, the revenue declined almost at the same pace as in the auto segment on a sequential basis. Can you break up for us which segments are drag here? We understood aerospace is doing well. So, which are other sub-segments where we see a challenge.

Well, we saw aerospace pick up and demand continues to grow in aerospace. So, we're very bullish about the ongoing momentum that we've established there. We've seen a little bit of softness in industrial heavy machinery, but that's on account of one project that was short closed in the fourth quarter. We're not seeing the type of softness that's informing the slowdown that we've grappled within in automotive over the last 12 months.

Thank you and all the best.

Thank you. Next question is from Manik Taneja: from Axis Capital. Please go ahead.

Hi, thank you for the opportunity. I had a couple of questions. The first question was with regard to the expectation that we should start to see a recovery from Q2 onwards. Could you talk about how you see the demand within your anchor customers and outside of that? And if the sequential rebound essentially is largely led by anchors or the external customers? That's question one. The second question was with regards to our on-site offshore revenue mix. It appears that metric also got impacted with the pressure that we saw in terms of revenue, if that's the only reason for the change in terms of metrics? Or there is also a change in terms of the type of projects that you're winning, which is impacting this metrics? Those are the two questions.

Great questions. Certainly, we've been very encouraged by the sustained strong demand from the anchor customers, both Tata Motors and JLR. And as I commented in my opening remarks, we see that continuing to be very much a part of the demand environment that we look to intersect with. I think the confidence, however, in Q2 and the second half of the year, is much more informed by the overall sentiment in the automotive market. One of the things that we continue to be reminded of is that the automotive industry is a product -led industry. And I think that the uncertainty that has defined the space over the last 12 months as the election cycles have played out in North America and as the EV incentives in Europe have runoff, there's been a lot of latent product investment decisions that have been building up. And I think that, that the sort of anticipation that we had at the beginning of the fiscal, that latent investment demand would convert into new products was somewhat undermined or compromised by the tariff announcement. But we've seen that largely play out in the first 3 months and a lot of the decisions that we were anticipating are now starting to get made. And so, our confidence in Q2 and the rest of the year is really about broad market sentiment and not just about specifically what's going on at JLR and TML

Sure. That's make sense. I think the question was with regards to our on-site, offshore revenue mix then.

The onshore offshore, the change in mix is largely driven by what's happening in aerospace. Aerospace is for us an area of growth. It's been driven largely by what's going on in Airbus, but the reputation that we're building in Airbus and the associated opportunity that we're getting within their supply chain, particularly in and around the propulsion players, is giving us an opportunity that is beginning at first onshore. And then we are leveraging the relationships and the credibility that we're building to drive business offshore. So, it's part of the sort of life cycle of engagement that we're seeing with a number of our aerospace customers.

Sure. Thank you, and all the best for the future.

Thank you.

Thank you. Next question is from Darshil Jhaveri from Crown Capital. Please go ahead.

Hello? Good evening, sir. Thank you so much for taking my question. Hope I am audible.

Yes, you're very clear. Very clear.

Well, we don't -- we haven't provided specific details in terms of order book. But as I said in my opening remarks, the order book at the end of the first quarter is better than the order book this time last year. So again, our confidence in the rest of the year is driven in part by those base points.

Okay. Fair enough, sir. So, if you could just maybe help with what kind of percentage growth is there in the order book that could just indicate like what kind of win that we had better sir if that's possible?

We've seen a material improvement, but we don't quantify the improvement in order book in specific terms or in percentage terms.

Fair enough, sir. I also just wanted to know any kind of new areas from other than our existing areas are we targeting to grow at or looking for it, sir?

Yes. I think there's a number of areas that is informing not just the order book, but also the pipeline. I've referenced aerospace. Typically, our business in the past has been in the aero structures in the MRO space. We are now extending that into propuls ion systems. And that's enabling us to build relationships, again, outside of the work that we've done in the last 3 years with Airbus. In both Automotive, Aerospace and Industrial heavy machinery, there's a lot of work that we are undertaking in and around smart manufacturing. And that relates one to the deployment of digital solutions, particularly PLM, ERP and MES solutions and the inte gration of the technology stack that informs and deploys the ability to be able to fully integrate the digital definition of the product with the manufacturing process and the way in which products are built. We're also seeing a lot of upticks in and around the deployment of AI solutions in manufacturing. In the fourth quarter, we announced a very large deal with a Tier 1 North American automotive company, where we are deploying our proprietary AI framework at CHROMOSOME.AI into that organization across 100 plants. We are deploying sensors, collecting data and using that platform to enable the organization to accelerate manufacturing throughput and an increase manufacturing uptime of assets, legacy assets within those plants. So, we're seeing a lot of opportunities in and around that space. And that's a reputation that we believe that we will be able to capitalize, not just in the short term but in the medium to long term.

Okay. That helps me a lot. I will join back the queue for further questions. Thank you so much, sir.

Thank you.

Thank you. Next question is from Sudheer from Kotak Mahindra Asset Management. Please go ahead.

Yes. Hi, Warren. Thanks for the opportunity. A couple of questions. Firstly, for the last few quarters, at least, we have been quite optimistic about the demand recovery. And when the revenue growth number comes in, that doesn't seem to be happening. So where exactly is the slip between the lip and the cup? Is it primarily because of the macro across all these quarters, or because of the high client concentration? Or is there anything to worry about the execution on ground?

Yes, I think it's a good question, Sudheer. But if you look at the situation at the end of the last fiscal year, we were very optimistic about a strong start to FY '26. And we had positioned capacity and capability to discharge that opportunity. Unfortunately, on April 2, the announcement was made about tariffs. And I think the uncertainty that it generated prompted a number of our customers. And a number of the projects that they were looking to launch to be paused and delayed. And so, whilst we entered the quarter with confidence and with high expectations, we've had to recalibrate the expectations for the 3 months , at the start of the fiscal year , as a result of that macro issue. We continue to invest in capability as you've seen through the margins, we protected capacity primarily because we expect the situation to be short-term. And we are very confident about Q2 and continue to believe that the second half of the year will be better than the first. So, we see the challenges, the headwinds that we've faced as being tactical, short-term, and we expect to bounce back very soon.

Sure, sir. My second question is, I think in the media interaction you mentioned, probably you will do double-digit growth in FY '26. Now with a very sharp decline in the first quarter itself. So how do we think about the full year’s outlook in terms of revenue growth? That would be from me. Thank you so much.

Yes, I think we certainly have had our expectations somewhat challenged by the events of the first 3 months. But double - digit will continue to be on North Star. We'll see how we do in the second quarter. And I think we'll have a much more informed perspective a s we move into September and October. So as of right now, we will continue to push the organization as hard as we can to achieve the type of growth that we had planned for at the beginning of the year. But I think the next 3 months will really determine whether or not that's realistic.

Next question is from Kunal from Bank of America. Please go ahead.

A couple of questions from my side. The first one is on margins. As you think about the 200-basis points EBIT margin decline in the quarter, I just wanted to understand how much of it of this could be lost to operating leverage versus the on -site bump-up that you've seen? And is it fair enough for us to assume that what's been lost to operating levera ge should be sort of recouped in the next 2 or 3 quarters?

Yes. Thanks for the question, Kunal. I would say that at this point in time; we would attribute a large proportion of the drop in margin through the operating leverage given that we've not really affected any kind of a structural shift as far as overall capacities are concerned. We did obviously have a shift as far as onshore related revenues are concerned. But from a capacity perspective, it didn't really change much between on -site and offshore capacities. Therefore, at this point in time, I think it's fair to assume that most of it is really more of an operating leverage effect.

I understand. And the second question is Warren, your comment around aerospace and the great progress you're making with Airbus as an account. So just to better understand that -- is this progress more in terms of the newer kind of work opportunities that are opening up within Airbus for the company? Or is this more to do with the fact that as you're working with one of the key companies here, you're starting to get to work with other companies in the ecosystem, let's say the airline itself?

I think the demand and the confidence that we have in aerospace is largely driven by the growing confidence that Airbus have in our execution and capabilities. I think we've been through a learning curve over the last 3 years. We've invested in infrastructure. We've built a nexus in Toulouse and Hamburg, and we've delivered services to Airbus in the Aerostructures area. We've deployed digital solutions that have been focused upon accelerating manufacturing throughput. We've engaged in delivering robotic solutions as far as the assembly process is concerned. And I think the big confidence and the capabilities that we've d eployed have afforded us more and more opportunities in new domains inside of Airbus. Airbus have also been struggling as Boeing has in terms of building enough aircraft. The demand continues to grow. And they are not just challenged in terms of their own capabilities, but they are challenged in terms of the capabilities of their supply chain. So, we've been leveraging the endorsement of Airbus and the recommendations that they've been providing to their suppliers to initiate opportunities with their key suppliers and these are large organizations. These are the engine manufacturers and the aircraft seat manufacturers. And so, our confidence and the momentum that we're building is largely driven by that. Obviously, the investment that the Tata Group is continuing to make, is providing tailwinds that we're also intersecting with but I think the major driver of demand and opportunity, order book and pipeline is really the great work that we've done with Airbus over the last 3 years.

Next question is from Abhishek Kumar from JM Financial.

Good to hear you're still being optimistic given the dynamic environment. My question was on the deal pipeline or the environment around deals. Last quarter, we spoke about potentially some of the German OEMs looking at more offshoring. Have you seen any progress on that front? Do you think they are still looking at higher offshoring or given the uncertainty, there has been a pause around large deal decision-making as well?

Yes, we've certainly seen continued traction from the German OEMs. I think all three of the big OEMs in Germany are now requiring BCC components to their sourcing of engineering services. That's not only providing opportunities for organizations like ourselves, but it's also providing opportunities for organizations like ourselves to partner with their incumbent engineering service providers onshore. And so, we're seeing a number of deals and a number of partnership opportunities progress over the last 3 months. So that push of Germany into not just India but also places like Eastern Europe and Morocco is continuing at pace.

Okay. The second question is on OEMs versus Tier 1. One of your peers recently said that the pain is higher in Tier 1. How do you see that? Do you think for us also Tier 1 decline is higher? And if we can get some idea of what would be our share of OEM versus Tier 1 in th e auto vertical? Thank you so much.

Yes, I think that's a great question. And I would certainly endorse the fact that the supply chain is feeling the pain somewhat more acutely than the OEMs. But somewhat counterintuitively, that is providing opportunity. I referenced the work that we're doing with one of the North American Tier 1 automotive suppliers in and around smart manufacturing. When a supplier looks at the unit economics of their business, one of the levers that they look to apply is optimization of the manufacturing process because that's where the majority of their value outside of ER&D is delivered. And so, we are seeing a significant amount of opportunity in terms of deploying technology and taking legacy assets and interjecting capability that will drive optimization and productivity improvement. And the reputation that we've established at places like JLR and Tata Motors , places that we can take our customers to gives us real credibility in that particular space. The fact that we really not only understand the technology but understand the domain challenges and can go toe -to-toe with the manufacturing engineers and demonstrate how capabilities like AI can make a difference. I think that represents not only significant opportunity in the short term, but certainly something that we expect to build upon in the future.

Sure. I mean, can we get some sense of what our exposure would be to Tier 1?

I don't have a specific number for you, but that's something that we can get back to you through Vijay and his team. So let me come back to you with those numbers.

Sure. Thank you and all the best.

Thank you. Next question is from Shradha Agrawal from AMSEC. Please go ahead.

So, in terms of German OEs, we did indicate that they are looking at the higher outsourcing to India or Eastern Europe countries. So how are we looking at demand trends from U.S. auto OEs?

The demand trends with the North American OEMs have been strongly impacted by the tariff decisions. And not just the tariff decisions, but also the b ill that's just gone through Congress that has taken away some of the components of the Inflation Reduction Act that has positioned investments for EVs. And so, what we've seen with Stellantis with Ford and to a lesser extent, with GM is those organizations revisit their product plan from a propulsion systems perspective and also from a manufacturing perspective. And that's prompted somewhat of a pause in the las t 3 months. We are starting to see some clarity come through from those three companies and we expect that clarity to precipitate into product decisions in the next couple of months.

Right. And in terms of our clients, is there any visibility or any improvement in the outlook that we see from our anchors?

As I said before, the demand from our anchors has been strong. I think their financial performance has been very strong. And we do not see in the short term any change to that. So, we're very excited about the work that we're doing and the opportunities that we currently have visibility of?

Sure. Thanks Warren.

Thank you. Next question is from Ankur Pant from IIFL. Please go ahead.

A couple of questions from my side. First one is, is the recovery that you're speaking of, is that also coming from an improvement in the challenges that the OEMs have been grappling with over the last year? Has the situation there improved or is it more of a latent demand or delayed ramp - ups which are finally starting to come through, which may also make the demand more volatile from here? How do you see that?

I think it's a bit of both. I think if we look at the last 12 months, you look at the policy positions of the Republicans and the Democrats that we're competing for the White House last year, there were stark differences in the approach to alternative propulsion systems and particularly EV. So that prompted a delay in decision -making among our customers. And that impact was not only felt in North America, but it was also felt with those OEMs that have a great exposure to the North American market. I think the clarity that we saw in November certainly precipitated in much better engagement that we had with our customers in January, February and March. That's what informed confidence going into the fiscal year. But that confidence was somewhat undermined by the tariff decisions or the tariff announcement on April 2nd. Now we have seen some of that play out. I think the agreement between the U.K. and the U.S. is hopefully an indicator of what's likely to happen with other countries. And I think that there is an increasing view that common sense will prevail. And as a result, we are starting to see the decisions that we expected at the beginning of the fiscal year come through. So, I think that there was a delay and a buildup of demand for new product investment that was driven by the sort of geopolitical things that played out last year. I think the tariffs have compounded that, but we are confident that we're through most of the distraction that represents, and our customers are now starting to make decisions.

Thanks. That's helpful. But just prior to the tariff situation, the European OEMs were undergoing significant stress in terms of profitability competition. Has that situation improved or is that pretty much the same?

I think that the industry is going through the typical cycles from a demand perspective that defines the automotive industry. It's been somewhat compounded by the rapid shift to EVs in China that has been largely taken up by new energy vehicle companies in China. So, our customers in terms of their financial performance will, I think, continue to face some headwinds in the next 12 to 18 months. But I think one thing that we all have to remember is that the automotive industry is a product-driven industry. And the one thing that is typically protected is the investment in new products. And I think the investment has not been there in the way in which we expected over the last 12 months because of the things that I've cited before. And that, I think, reinforces the priority that most of our customers are having to position in deploying the investments that are long overdue.

And secondly, on margins. Now we've seen a sharp decline in margin this quarter. How do we see the margin trajectory from here on? And any decision in wage hikes, when they would be alright?

So, I think outlined the earlier part of the call today, the impact on the fixed costs that we have run that within customers has largely explains the drop as far as margins are concerned. That being said, from our perspective, I think we continue to maintain that our goal post is to move towards the 20% margin band as we scale up our operations. That being said, we will continue to, of course, start looking at optimizing costs, all delivery and efficient lever s that we have at our disposal, be it improving offshoring sequentially, looking at rationalization of our people pyramid. And of course, going ahead, we will also continue to see improvements gradually as we see a lot of productivity improvements come through the use of AI and other tools but these, of course, will, as I said, reflect more gradually over a period of time. And to the point that Warren made earlier in the call, as we see Q2 play out, we'll be in a much better position to assess what the rest of the year is going to look like while our ambition will continue to try and see how we can at least ensure margin preservation for the year as we exit Q4. I think we'll be in a better position to assess the situation.

We haven't discussed on the wage hike yet, so that is something that the management will discuss internally and take appropriate discussions with the organization.

Next question is from Chandramouli Muthiah from Goldman Sachs.

My first question is just around the sequential recovery we expect through the rest of the year. So does that assume that the current stand-off on tariffs get resolved at some point in the next couple of months. I just want to understand what needs to happen for more visible sequential recovery in the back half.

I think our confidence in Q2 is really not informed by any expectation in terms of the trade negotiations that are going on between various countries. It's largely informed by the order book and the qualified pipeline that we're taking into the period. I t hink the trade negotiations will likely inform the environment in which we operate in the second half of the year. So, there will be an influence clearly that the trade negotiations between Europe and the US specifically will have on the environment. But I think certainly, Q2, our confidence is driven by deals that we've closed and sentiment from our customers is really giving us a level of confidence that they are seeing past the tariff announcements that were made at the beginning of the fiscal year. And that latent need to invest in products is starting to get prioritized and will give us the deals that will ultimately continue to allow us to drive momentum and growth throughout the subsequent quarters of this fiscal year.

All right. That's helpful. And just related to that, you did mention that you have seen a pickup in the order book at the end of Q1 versus last year at the same time. So just trying to understand, we did have these disruptive announcements on tariff towards the end of March. So, through the quarter, have you seen things pick up since then? Just trying to understand Q4 this year versus Q4 last year, how the order book looked? Just trying to sort of understand what's happened to the quarter and then help your order book Q1 end of q uarter versus Q1 end of quarter last year?

I think if we look at the quarter in terms of deal signings, April was a month that was very muted in terms of deal signings. The announcement on tariffs was made on the 2nd of April, and that prompted many of our customers to pause and to delay decision- making. I think the review that the customer base undertook in April, played out into the sort of early part of May. And since then, we've seen decisions being made and the improvement that we've seen in the order book is largely through deals that we've signed in the latter part of the quarter. So, the momentum is built as confidence has built and as our customers have become , from a scenario perspective, somewhat confident that they can work through the uncertainty that is out there.

Got it. That's helpful. My second question is just around the other income run rate. So, we have seen a pickup in income quarter-on-quarter. I think in previous quarters, you have broken that bridge in terms of what fair value investment gains are, what the hedging costs could have been and what the treasury gains have been. So, INR 57 crores of other income last quarter versus INR 64 crores of other income this quarter. I just want to understand what part of that is sustainable to expect going forward and if there is a bridge that you were able to provide as well?

Most of the incremental effects that you see quarter - on-quarter sequentially, as I had outlined in my opening comments, reflect actually the unrealized foreign exchange movement on some of the assets that we have on our balance sheet. The treasury income out of the total income is about INR 24 crores, both interest as well as what we've realized through sale of some of our mutual fund investments. And as we build up cash balances, I would like to believe that some of that would reflect, of course, the yield curve as we see in the world -- across the world, but you should have some part of it that is sustainable. And we also continue to have the INR 8 crores plus effect from the BMW JV investment that we had outlined in the past.

Got it. That's helpful. And just the last question is around Technology Solutions. So, this has been a lumpy business on a quarterly basis in the past. But usually, I think this business picks up towards sort of the end of the year, the second half of the year, first quarter is usually sequentially slow. I just want to understand what the positive lumpiness has been and how you're looking at Technology Solutions growth through FY '26 this quarter and for the full year?

Technology Solutions is made up of education and products. We have sustained and until the third and fourth quarter last year, over the course of the last kind of 2 years, sustainable improvement in education. And that's a business that we're working hard to ensure that we manage out the lumpiness. We had some infrastructure challenges in Q4 specifically that -- related to the readiness of the labs that we will deploy our solutions to and that's largely been resolved, and you've seen that in the improved performance of education in the first quarter. Products, however, is a seasonal business. Most of our customers in that area discharge budgets at the end of the calendar year, particularly in North America, and the large maintenance contracts are typically renewed at the beginning of the new calendar year. And so Q3 and Q4 are the big quarters for the products business. And so, there is some lumpiness and some seasonality that we have to factor into our plans because of that.

Got it. That's helpful. And just lastly, around head count. I just want to understand, as you see sequential improvement to the -- where we are at presently in terms of utilization rates? And when would we potentially trigger a pickup in headcount, if that's the plan for the rest of the year?

I think we'll continue to monitor the demand environment. I think that there is a capacity that we have that we can look to put to work to satisfy the growth that we are expecting in the second quarter. And then I think we'll recalibrate our headcount plans at the end of August, beginning of September as they pertain to the second half of the year.

The next question is from Rajiv Berlia from Citi.

Just one clarification. You mentioned that 1Q got impacted due to delayed ramp -up and elongated decision making. Did you see any deal cancellation in 1Q and also, how did the pricing play out in 1Q? Did you see any pressure in terms of pricing?

We've not seen any significant deals getting cancelled. There was a deal in the IHM space in the fourth quarter that got short closed. That was a project that we were engaged with and because of macroeconomic uncertainty, the customer decided not to progress with that particular project. But that's the only project that we've seen being closed. Most of the issues associated with the softness in Q1 were related to delays of decision -making and not cancellation of programs. And that's one of the reasons that we, again, are confident about the rest of the year because that need is still very much there. On pricing, the current environment is prompting most of our customers to challenge us on pricing. But I think so far, we've resisted that challenge quite well and that's something that we'll continue to work hard to do.

Thank you very much. We'll take that as the last question. I would now like to hand the conference over to Mr. Vijay Lohia for closing comments.

Thank you all for joining us on today's call. We hope we've addressed most of your questions. If you have any other queries, please feel free to reach out to our Investor Relations team, and we'll be happy to assist you. Wishing you all the best and goodbye from all of us here. Thank you.

Thank you very much. On behalf of Tata Technologies, that concludes this conference. Thank you for joining us, ladies and gentlemen. You may now disconnect your lines.