### **Overview** **Onward Technologies Limited** is a global provider of **digital and engineering research & development (ER&D)** services, catering primarily to **Global 2000 original equipment manufacturers (OEMs)**. Headquartered in **Mumbai, India**, the company is listed on the **BSE (517536)** and **NSE (ONWARDTEC)**. Founded in **1991** by Mr. Harish Mehta, a co-founder of NASSCOM, the company underwent a significant transformation starting in 2016 under the leadership of Managing Director **Mr. Jigar Mehta**, shifting from a traditional IT services provider to a **pure-play digital and ER&D services firm**. This strategic repositioning—"**Onward Technologies 2.0**"—has enabled it to focus on high-margin, high-value engineering and digital transformation solutions for large multinational corporations. --- ### **Core Business & Service Offerings** Onward Technologies operates across **three horizontal service lines**, aligned with growing industry demand: 1. **Digital Engineering Services** - Cloud & DevOps (AWS, Azure) - Data Engineering & Analytics (AI/ML, Big Data) - Generative AI (e.g., Azure OpenAI-based warranty automation) - Robotic Process Automation (RPA) - Cybersecurity, IoT, AR/VR 2. **Embedded & Electronics Engineering** - AUTOSAR, ADAS, and Functional Safety (ISO 26262) - Electric and Connected Vehicles - Motor Control Software for EVs (e.g., IPM motors with hairpin winding) - ECU, ASIC firmware, and embedded systems for automotive and industrial applications 3. **Mechanical Engineering Services** - Product Design, Value Engineering, Virtual Simulation - CAD Customization, FEA/CFD Analysis - Design for Manufacturing, Technical Documentation - Fluid Line Design, Wiring Harnesses These services are integrated into **end-to-end engineering R&D solutions**, positioning Onward as an **extended digital and ER&D team** for clients. --- ### **Industry Verticals** The company serves clients in **three focused verticals**, which together account for nearly 100% of revenue: | Vertical | Revenue Share (FY 2024-25) | Key Clients & Segments | |--------|----------------------------|------------------------| | **Industrial Equipment & Heavy Machinery (IEHM)** | 57% | Caterpillar, Wabtec, GE, John Deere – Off-highway, mining, energy | | **Transportation & Mobility (T&M)** | 38% | 8 of top 11 global automotive OEMs including Daimler, VW, Cummins – EVs, ADAS, Rail | | **Healthcare & Life Sciences (HCLS)** | 4% | Global pharma and medtech firms – medical devices, digital health, regulatory compliance (FDA, MDR) | > The HCLS vertical is a **strategic investment area**, expected to grow significantly due to long-term secular trends in digital health and MedTech innovation. --- ### **Clients & Market Presence** - **Total Active Clients**: ~80 (consolidating from ~250 in 2020 as part of a strategic client focus) - **Top 25 Clients**: Contribute **84–85%** of total revenue - **13+ clients** generate over **$1 million** annually; growth targets include 10 clients at **$10M/year** to reach **$100M in revenue by FY26** - Clients are primarily **U.S. and European OEMs**, with invoicing in USD, EUR, GBP, and INR - Focus on **Global 2000 firms** with R&D budgets exceeding $500M - Long-standing relationships with **Caterpillar, Daimler, GE, John Deere, Cummins, Wabtec, Volkswagen** --- ### **Global Delivery Model** Onward employs a **balanced global delivery model**, combining **onsite, nearshore, and offshore capabilities**: - **Workforce**: ~**2,500 employees** as of Oct 2025 (down from 2,973 in 2023 due to strategic exit from low-margin domestic India business) - **Office Network**: **12 offices across 6 countries** (India, U.S., Canada, U.K., Germany, Netherlands) - **Sales & Project Offices**: Chicago, Detroit, Toronto, London, Frankfurt, Cleveland - **Delivery Centers**: Pune, Chennai, Bengaluru, Hyderabad, Mumbai - **Offshore Development Centers (ODCs)** and **Global Capability Centers (GCCs)** in India, serving as extensions of client teams - Strategic shift from **large onsite presence** to **local account managers** backed by **offshore delivery**, improving scalability and margin leverage - H-1B visa approvals secured to support U.S. onshore expansion and talent acquisition (target: 200–300 visas in 2–3 years) --- ### **Growth Strategy** #### **Strategic Pillars** - **Account-Based Growth**: Deepening relationships with top strategic clients; account managers focus on expanding wallet share - **Vertical Focus**: Concentrated investments in IEHM, T&M, and HCLS – sectors expected to represent ~50% of global ER&D spend by 2030 - **Revenue Mix Shift**: Transition from mechanical engineering dominance (~50%) to a **50:50 balance between ER&D and Digital** by 2026 - **Geographic Focus**: Exclusive emphasis on **North America and Europe**; no expansion plans in Asia or domestic India #### **Financial Targets** - **Revenue**: Target of **₹600 crores (~$72M)** in FY25–26 and **$100M by FY26** - **Profitability**: **Mid-teens EBITDA margin** targeted (up from ~11.1% in FY24) - **Growth Outlook**: **Double-digit revenue and EBITDA growth** expected for current and next fiscal years - **Cash Flow**: Strong liquidity (~₹93.6 crore cash reserve as of March 2024), debt-free balance sheet, six-year dividend track record --- ### **Operations & Infrastructure** #### **Key Facilities** - **Chennai Design Center**: Largest development center (planned for 2,000 employees); consolidating industrial and automotive delivery - **Pune Hub**: Almonte IT Park (upgraded); home to embedded electronics lab and healthcare software teams - **Navi Mumbai & Hyderabad**: Digital Centers of Excellence (CoE) for AI/ML, cloud, and data analytics #### **Strategic Investments** - ₹12 crore capex planned for FY 25–26 to upgrade Pune and Chennai infrastructure, labs, and hardware - Expansion of global project offices in USA, UK, and Germany to be closer to clients - Development of a **2,000-person Talent Academy** to upskill engineers in digital, embedded, and mechanical domains #### **Talent Strategy** - **Talent Acceleration Program (TAP)**: Trains freshers and mid-level engineers in digital and embedded tech (300+ trained in 2023–24) - Hiring focused on **Subject Matter Experts (SMEs)** in digital, embedded, and healthcare - Internal recruitment team (>65 specialists) reducing dependency on third-party agencies - Market-linked **ESOPs** to align employee incentives with long-term performance --- ### **Technology & Innovation** - **Generative AI**: Deployed Azure OpenAI solution for **automated warranty claim processing** (90% accuracy, 75% effort reduction) – scalable to other clients - **Digital Twin & Industry 4.0**: Delivered smart factory enablement, virtual commissioning, and IoT integration for off-highway OEMs - **High-Performance EV Motor Design**: Achieved **98% efficiency** and **80% reduced AC losses** using **hairpin winding technology** - **Advanced Testing & Simulation**: Karate framework for API validation in fleet management systems; CI/CD integration with ADO - **IP Ownership Model**: Full **client ownership of IP** – a key differentiator that builds trust with OEMs --- ### **Recent Developments (Jul 2025 – Oct 2025)** - **Chennai Expansion**: New design center nearing full occupancy; will consolidate delivery for key clients in automotive and industrial verticals - **Revenue Visibility**: Strong order book and ongoing **next-year budgeting discussions with major OEMs** enhancing future work visibility - **Client Consolidation**: Reducing total client count to deepen engagement with top-tier OEMs; focus now on strategic top 50 - **Digital Growth Acceleration**: Digital engineering now contributes ~50% of revenue as clients demand software-defined products - **Operational Efficiency**: Consolidation of Pune and Chennai operations into larger, integrated campuses is reducing cost and boosting efficiency - **Automation Maturity**: Internal OTL (Operational Technology Layer) tools are reducing overheads starting Q4 FY25 --- ### **Key Financials (FY 2023–24)** | Metric | Value | |-------|-------| | **Revenue** | ₹472.4 crore | | **EBITDA Margin** | 11.1% | | **PAT** | ₹36.3 crore (~7.7% margin) | | **CAGR (FY22–FY24)** | 24% revenue growth | | **DSO (Days Sales Outstanding)** | Improved from 86 to 72 days; target: 65 days | | **Headcount** | ~2,581 (as of Mar 2025) | | **Top 25 Clients Revenue Share** | 84% | | **Geographic Revenue Mix** | 50% North America, 25–30% Europe, 20–25% India (INR billing from MNCs) | --- ### **Ownership & Governance** - **Infinity Direct Holdings** acquired a **24.2% stake** in 2021–2022, marking a major private equity investment - Subsidiaries: - Onward Technologies Canada Inc. (100%) - Onward Technologies B.V. (Netherlands, 100%) - Onward Technologies GmbH (Germany, 100%) - OT Park Private Limited (real estate asset in Pune) - **Board-led, operationally agile** – leadership team in place to scale to $100M without immediate need for senior hires