volumes it was expected to must have been disappointing for Tata. As must have been the debilitating losses in the telecom piece — an effort to explore new areas in a liberalised economic regime — or the ambitious $12-billion acquisition of the Anglo-Dutch steelmaker Corus which has left Tata Steel hugely leveraged, an attempt at making the group global.
No doubt the Tatas has the financial muscle to foray into new spaces but there was also the appetite for risk; some of the global buys may not have been well-timed, a fact that Tata has graciously conceded. But there’s no doubt many of the buys – the hotels for example – hold out promise. The spectacular turnaround at the loss-making Jaguar and Land Rover bought for $2.3 billion in March 2008 – critics carped that the Tatas would never be able to sell luxury brands in unfamiliar markets – in less than three years was proof of the group’s technological and marketing skills.
But it’s a fact that TCS accounts for a tenth of the group’s turnover, a higher third of the profits and half of the market capitalisation. However, sceptics who believed the Tatas would never do well in the consumer space have been stumped by the success of a Titan or even a Westside. The biggest asset that Tata will leave for Cyrus Mistry, of course, is a capable cadre of CEOs. But without its ‘ratan’ the Tata Group can never be the same.