LTTS’s technological prowess makes it a global gamechanger, writes Bappaditya Paul
Think L&T, and the first thing that comes to the mind is L&T’s trademark yellow construction equipment or workers busy at some mega construction site. That is because equipment engineering and construction projects are what L&T had started off with, and, to date, are its most common visual manifestation.
But interestingly, the fact is, over the past few decades, L&T has evolved from being a ‘brick- and-mortar’ company to a ‘click-and-mortar’ conglomerate in the true sense of the term. So much so, that by FY 26 L&T wants to earn at least 33% of its revenue from the IT, technology and financial services business.
Engineering R&D company L&T Technology Services (LTTS) is one of the entities that have given L&T its new-age identity. Not many would know that in this sector, LTTS is the world’s ninth largest. In India, the third.
LTTS achieved USD 1 billon revenue run-rate in FY 22-23 and 92% of the earnings came from abroad. As of today, LTTS is present in over 20 countries: it has 20 offices in Europe, 11 in the US, 8 in the APAC, 10 in India and another 5 in the rest of the world.
If all these read like dry business facts, here's something that everyone will be able to relate to. And if you are an Indian, it will make you proud.
The aero engine that powers the most trusted aircraft in the sky, the latest driverless car that has hit the US streets, the electric car launched by a global original equipment manufacturer (OEM), the top-notch lawn mower launched in Europe, the soon-to-be-launched electric bike by a Japanese major, the most revered sound system booming worldwide, the 5G mobile communication that’s the new craze everywhere, the latest robotic surgery arm rolled out by a German major, the hi-tech patient bed launched by a French brand, the re-engineering of a mega oil refinery in the US, the most efficient LED light available in the market and so on – all of them have something in common! A distinct mark of LTTS’s R&D – either at the product development stage or at the optimisation stage.
In short, LTTS’s business offering encompasses any product that requires engineering design, re-design, testing and life-cycle support. The company offers R&D services under its six verticals – Transportation, Industrial Products, Plant Engineering, MedTech, Telecom and Hi- Tech.
This being the case, one can simply imagine the expanse and depth of the hi-tech engineering services that LTTS undertakes. No matter where on earth you live, think of any tech-product you use, and LTTS has played a role in it – directly or indirectly!
HOW IT ALL STARTED
L&T always had an innovative business acumen. It accumulates the innovations that it undertakes while implementing a project or delivering a solution, gains mastery over them, and then leverages the same to come up with new business offerings. Like several of L&T’s business verticals, LTTS too took shape in the same fashion.
“L&T used to have several business units providing engineering R&D and manufacturing services to various industrial sectors. It had Integrated Engineering Services (IES) at Vadodara, Chennai and Bengaluru; Embedded Systems in Mysore and Bengaluru; Mechatronics in Mumbai and General Engineering Services in Chennai. In 2009, all these entities were brought under one umbrella named L&T IES, and several key people from the IT sector were inducted to drive the business,” recalls LTTS CEO & MD Mr Amit Chadha.
“Next, in keeping with the leadership’s vision to take L&T’s engineering services to the world, in 2013 the Product Engineering Service division of the then L&T Infotech (now LTIMindtree) was merged with L&T IES, leading to the emergence of L&T Technology Services,” Mr Chadha adds.
From L&T IES’s USD 60 million revenue in FY 09-10, LTTS’s revenue rose to USD 400 million in FY 14-15. Encouraged by this, L&T leadership accorded it the status of an independent subsidiary, and LTTS was listed in the bourses in 2016. Since then, there has been no looking back.
ON THE HI-TECH HIGHWAY
From a staff strength of merely 1,600-odd people in 2009 (in its previous avatar as L&T IES), LTTS today has 23,000 employees and counting.
Go to the LTTS office in Vadodara, Mysuru, Chennai or Bengaluru, and you will be amazed by the wide array of labs undertaking R&D for electric & autonomous vehicles, 5G communication, robotic surgery arms, LED technology, top-notch sound systems, power infrastructure, plant engineering, digital manufacturing and so on. They cater to clients that are the world’s who’s who in their respective domain.
“To give you something relatable, we recently provided digital engineering services for an automobile OEM to help them develop a new generation of Software Defined Vehicles. But, owing to the confidentiality clause, we cannot name the brand,” says Mr Abhishek Sinha, COO & Board Member – LTTS.
As far as business offerings are concerned, LTTS is diversifying and expanding constantly. This January, it acquired the Smart World & Communication (SWC) arm of parent L&T. With this, the portfolio comprising NexGen Comms, Sustainable Smart World and Cybersecurity has become LTTS’s newest business offering.
“Smart City as a business offering has tremendous prospects abroad, particularly the US and the Middle East. We have started leveraging it as a growth driver and have already booked orders worth USD 10 million,” explains Mr Sinha.
The acquisition of SWC is part of LTTS’s larger strategy to drive business growth and achieve the ambitious USD 2 billion revenue by FY 26. “In addition to stepping up our existing business units, inorganic growth is the other channel that we are pursuing actively. There could be a few more acquisitions on the way,” he adds.
As a business philosophy, LTTS annually invests anything between 1-2% of its earnings in creating tech assets for itself. This helps it develop business offerings even before its competitors wake up to such prospects.
No wonder, as of today, LTTS owns as many as 1,145 patents in various engineering technology domains. “Earlier we used to file 25 patents a year. Now, we file 25 patents each for us and our customers every quarter. This is one of our major achievements and is a validation of the investments we make in future technologies,” beams Mr Chadha.
While people are talking about electric vehicles only now, LTTS invested in this space much earlier. In fact, amidst the COVID pandemic in 2020, it opened an EV Lab in Bengaluru, and is now reaping the first-mover advantage.
FAST-TRACK FUTURE
In the immediate future, the sectors that LTTS is investing in aggressively include AI, Software Defined Vehicles, NextGen Communication, medical data-as-a-service and cybersecurity. While LTTS already has a 200-odd member AI team, it wants to scale it up to 1,000 by the end of this year.
But when the IT/ITeS companies worldwide are laying off people citing a slump in the US economy, how come LTTS plans to hire more? Pat comes Mr Chadha’s reply.
“See, this talk of recession is only a mindset. If you analyse the US and Europe economy from 2010-2020, they grew at 1.5-2%. During the same period, LTTS grew from USD 60 million to almost USD 1 billion and, mind you, 85% of our revenue comes from these two regions. Hence, it is important to find the pockets where the spend is happening and not worry about recession,” says the LTTS CEO reassuringly.
In addition to the optimal use of available manpower, LTTS says it will continue to hire at the rate of 15-20% per annum and groom the new talent to a standard of excellence. It’s amazing how the company nurtures young talent and their tech dreams.
In addition to a hybrid work schedule and several training initiatives, it runs high-octane employee engagement initiatives such as the company-wide music competition Voice of Technology Services or VOTS. Through its tech innovation competition, Reveries, employees pitch their dream tech projects, and if selected by experts, LTTS funds such dream projects!
LTTS launched the Global Engineering Academy (GEA) in 2020 to impart continuous competency development programmes for its employees. GEA has digital classrooms across Vadodara, Mysuru and Bengaluru, besides a centre in Poland specifically for automotive engineers. With top professors of reputed Indian and global tech institutes forming the resource pool, GEA has so far trained 18,000+ LTTS employees.
Justifiably, LTTS has earned the Great Place to Work certification twice in a row in India. This year, LTTS Poland too has been rated as a Great Place to Work.
Going by all indications, LTTS is confident of becoming a USD 1.5 billion run-rate company by FY 25. “But more than that, our parent company’s CEO & MD Mr S N Subrahmanyan has given us the ambitious dream of becoming one of the Top 3 engineering R&D companies worldwide. LTTS being L&T’s expression of engineering and technology to the world, this is a dream that all of us are working towards earnestly,” sums up Mr Chadha.
