Tata Elxsi shares up after pact with Red Hat to boost telco network monetisation

Shares of global engineering and design services major Tata Elxsi rose on Friday after it announced its collaboration with open-source solutions provider Red Hat to monetise applications and reduce operations costs through simplifying operations in 5G networks for telecom companies and enterprises.

Shares of the Tata Group company were trading 1% higher at ₹7,307.8 on the National Stock Exchange (NSE). It rose 1% to ₹7,306 on the BSE.

According to an exchange filing, the Tata Elxsi- Red Hat tie-up intends to create a use case factory to help global operators monetise their networks using industry-specific 5G applications across manufacturing, healthcare and transportation through proven verticalised applications and joint solutions.

"As a case in point, as the automotive industry aggressively pivots towards software-defined vehicles (SDV), there is a growing demand for real time, secure OTA (over-the-air) updates and containerised services through 5G networks. The collaboration enables telcos to address these OEM needs with an integrated solution using TETHER, Tata Elxsi's globally deployed connected vehicle platform; NEURON, Tata Elxsi's award-winning network automation platform, Red Hat OpenShift, the industry's leading hybrid cloud application platform powered by Kubernetes, along with Red Hat In-Vehicle Operating System," the regulatory filing said.

The two companies' collaboration would help telcos make a transformative shift towards seamless automation, service orchestration, and close integration. These developments will streamline operations and reduce operational expenditures to enhance productivity in the telecom industry.

Tata Elxsi reported a net profit of ₹196.7 crore for the March 2024 quarter, compared to ₹201 crore in the year-ago period. Revenue from operations was ₹905.9 crore in Q4 FY24, up from ₹837.9 crore in the preceding period last year.