The Tata group seems to be betting big on iPhones, with its latest regulatory filing with the Registrar of Companies indicating that it has injected an additional Rs 1,500 crore into Tata Electronics. This company manufactures iPhones under contract for Apple.This funding underscores the parent company’s ongoing support for expanding Tata Electronics’ capacity, which has become one of Apple’s largest iPhone manufacturers in India. A significant portion of the iPhones manufactured at Tata Electronics are exported to the US and Europe.
Tata bets on Apple iPhones
This equity investment in October has increased the total capital infusion by Tata Sons, the group’s holding company, into Tata Electronics to Rs 4,500 crore over the past year, according to an ET report. The filing also reveals that the company has doubled its authorized share capital to Rs 20,000 crore, suggesting the possibility of further financial support from the parent company.Tata Electronics did not specify the reason for the capital infusion, but the filing mentioned that to continue its operations, the company will need “additional long-term finance by issue of securities/equity shares.”
Growth Strategy At Play
Tata Electronics recently raised funds at a price of Rs 62 per share, according to Mohit Yadav, the founder of the business intelligence firm AltInfo. He told ET, “This will fund capex for electronics manufacturing and semiconductor expansion, with profitability timeline remaining uncertain amid heavy growth investments.”According to its regulatory filings, Tata Electronics reported a consolidated operating income of Rs 66,206 crore for 2024-25, up from Rs 3,752 crore in 2023-24. Despite this, the company is still operating at a loss. However, the net loss has decreased to Rs 69 crore in FY25 from Rs 825 crore the previous year.Yadav told ET that even with assets of around Rs 48,000 crore and a big consolidated revenue, the net loss in FY25 suggests that costs related to capacity expansions and integration are still impacting profitability.Counterpoint Research indicates that over 70% of iPhones sold in the US are manufactured in India, with Foxconn being the largest producer of iPhones in the country.During Apple’s earnings call in August, CEO Tim Cook mentioned that the “vast majority” of iPhones sold in the United States were manufactured in India, while most other products like the Mac, iPad, and Watch were produced in Vietnam.In addition to producing smartphones and high-tech components for Apple, Tata Electronics is making a significant move into the semiconductor industry. They are investing approximately $14 billion to establish a semiconductor fabrication plant in Gujarat and a chip assembly and testing facility in Assam.Earlier this month, Tata Group and Intel signed a memorandum of understanding to explore the manufacturing and packaging of Intel products for local markets at Tata Electronics’ forthcoming facilities. They also plan to collaborate on advanced packaging in India and look into the potential for rapidly expanding customized AI PC solutions for both consumer and enterprise markets in the country.
