By Rajesh Kurup,
L&T Technology Services (LTTS), a subsidiary of Larsen & Toubro (L&T), is scouting to acquire companies in North America and Europe, with ticket size of $50-75 million, to augment its offshore presence. The acquisition is a part of the company’s ‘six big bets’ strategy, which will enable it to touch revenues of $1 billion by the third quarter of next financial year, and further to $1.5 billion by FY25. LTTS had posted revenues of $737 million in FY21.
“We are actively pursuing acquisitions and we have a dedicated team which reviews targets on an ongoing basis. There are three distinct areas in which we are looking for acquisitions, namely automotive tech, med tech and independent software vendors (ISV),” LTTS chief executive officer and managing director Amit Chadha told FE in an interaction.
“These are white spaces we have in mind to further build capabilities. The ticket size of $50-75 million would be much higher than our past acquisitions, which were in the range of $20-$25 million,” he added. In the past four years, LTTS, the technology services arm of L&T, had acquired US-based Esencia Technologies for $27 million (June 2017), Bengaluru-based Graphene Semiconductor Services for $12.9 million (October 2018) and Texas-based Orchestra Technology for $25 million (October 2020).
Under its ‘big bets’ strategy, the technology and engineering firm is focusing on six segments: Electric autonomous and connected vehicle (EACV), 5G, med-tech, artificial intelligence & digital products, digital manufacturing and sustainability.These are areas with “tremendous growth potential”, he added.
LTTS, which has 5G labs in Bengaluru and Mysuru in Karnataka, and Dallas in the US, is also seeking a spectrum licence for its Mysuru campus to conduct test cases around medical healthcare, machinery and employee safety.
“We are seeing traction with chipset manufacturers, with consumer-electronics companies, operators and even brick and mortar companies in 5G,” LTTS CEO Amit Chadha said. On 5G, the company is working on new product development, test and automation, labs-as-a-service, network assurance, use cases and private networks. The company’s clientele includes chipset manufacturers, device makers and equipment vendors.
LTTS, which had hired 1,200 freshers in the last two quarters, plans to add another 2,000 freshers in the next two quarters. The majority of the freshers would be onboarded in the third quarter.
Nearly 26% of the company’s 17,900 workforce (as of September 30) are now back in office, while LTTS expects 80-90% of total employees to work from office in the next 2-3 years. The company expects its business cycle to return to normal from next calendar year.