Tatas line up over Rs 7,600 crore to fund electronics business

The Tatas have created a war chest for its greenfield electronic component and contract manufacturing business through Tata Electronics as it has lined up funds of over Rs 7,600 crore through a mix of capital infusion by the parent and secured loans, as per latest regulatory disclosures by the company.

As per filings made to the Registrar of Companies (RoC), Tata Electronics received over Rs 608 crore capital infusion in 2022-23 from its holding company Tata Sons - the highest in a single financial year, taking the total capital infusion till now to Rs 1,820 crore in last three years since it was started. The authorised capital of the company is Rs 2,000 crore.

The filings also show the company has raised secured loans of Rs 5,799 crore as of date.


"The company has almost exhausted its funding limit from the parent since the authorised share capital is Rs 2,000 crore and paid-up capital is Rs 1,820, leaving a balance funding capacity of Rs 180 crore to be utilised. It will have to expand its authorised share capital limit to further expand funding. Also, a portion of the secured loans of Rs 5,799 crore might have already been paid off," said Mohit Yadav, founder of business intelligence firm AltInfo, who analysed the filings.

Emails sent to Tata Sons and Tata Electronics remained unanswered as of Tuesday press time.

Tata Electronics is the group's latest greenfield venture into electronic component manufacturing business which is being scaled up to take on the likes of Foxconn and Dixon. The group is widely reported to be in the last stages of acquisition of Taiwanese contract manufacturer Wistron's iPhone manufacturing plant in Karnataka near Bengaluru.

This acquisition might be completed by Tata Electronics, which is separately also building a mobile phone component manufacturing unit with an investment of over Rs 4,600 crore in Tamil Nadu.

Once the Wistron deal is complete, Tatas will be the first home-grown entity to assemble Apple's iPhones in India. The group is also reportedly looking at a larger play in electronics which may include semiconductors, as Tata Sons chairman N Chandrasekaran told Nikkei Asia last December. The group in April roped in Randhir Thakur as the chief executive officer of Tata Electronics.

Thakur was earlier the president of Intel Foundry Services and was based in the US.

Interestingly, the company was originally incorporated as Tril Bengaluru Real Estate Four in 2020 with the objective of developing IT parks, special economic zones, real estate and infrastructural facilities in India and abroad.

Subsequently, the company's name was changed to Tata Electronics at an extraordinary general meeting that year itself. Regulatory filings show the company's memorandum of association and articles of association were subsequently modified as well.