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New Delhi:
As Ratan Tata steps down as chairman of India's largest industrial
house Friday, he leaves behind for his successor at Bombay House,
Cyrus Mistry, not just a $100-billion empire he helped grow
13-fold in the 21 years at its helm but also a legacy that earned
him wide praise as an able corporate leader with values.
Tata joined Tata Group as an apprentice on the shop floor of Tata
Steel's Jamshedpur plant in 1962. He took over the top job in
1991, succeeding uncle JRD Tata, at a crucial time when India
began its market liberalisation programme and his peers at the
"Bombay Group" argued against it and sought a level-playing field
for their businesses.
In the more than two decades at the helm, the Cornell-educated
Tata not only consolidated the group's business in domestic
markets but also expanded it globally, acquiring assets,
diversifying businesses and forging new linkages.
In recent years, he conceived and presented to the world the
smallest car "Nano". Much before that, in 2008, the Government of
India honoured him with its second-highest civilian award, the
Padma Vibhushan.
"Ratan has built very adroitly on the grand foundations built by
his predecessors, especially JRD. He has not only nurtured the
Tata DNA but reshaped it for the new age," Says Bajaj Group
chairman Rahul Bajaj.
"The very fact that he is retiring at 75 speaks volumes of his
commitment to managing the Tata companies through values," Bajaj
added.
Tata Group's market capitalisation, which has some 30-odd listed
companies, is now nearly Rs.4.54 trillion ($825 billion), 33 times
more than in 1991 when Tata took over the top job. During this
period, the group's aggregate sales have increased 43 times, while
net profit has grown 51 times.
Tata Group's global expansion started in 2000 with the acquisition
of Britain's largest tea firm, Tetley, by Tata Tea, now called
Tata Global Beverages.
Since then Tata Group has made several big-ticket global
acquisitions, including the purchase of Anglo-Dutch steel maker
Corus Group. Tata Steel also acquired Europe's second largest
steel maker Corus in 2007 for $12 billion. The company is now
called Tata Steel Europe.
Another big acquisition was of iconic British auto makers Jaguar
and Land Rover by Tata Motors.
The Group under Tata's leadership also made serveral other
acquisitions in the global and domestic markets.
These include acquisition of controlling stake in government-run
Videsh Sanchar Nigam Ltd (VSNL) by Tata Sons, purchase of heavy
vehicles unit of Daewoo Motors in South Korea by Tata Motors,
acquisition of Singapore's NatSteel by Tata Steel and purchase of
New York-based The Pierre hotel by Indian Hotels Company.
According to those following the Tata Sons story, it was to Ratan
Tata's credit that the group entered new businesses like
telecommunications, finance and retail and increased focus on
information technology and renewable energy.
At the same time the Group, they add, he led the exit from sectors
like cement, textiles and cosmetics, while embarking on new areas.
Today, as a result of that, the Tata empire has in its fold the
most profitable company in the information technology busines --
Tata Consultancy Services.
Godrej Group chairman Adi Godrej said Ratan Tata leveraged the
strength of TCS and Tata Motors while getting out of businesses
such as Tata Oil mills and Lakme which were not a strategic fit.
"His clarity of thought and vision for the group has shone through
remarkably," said Godrej, who is also the head of industry lobby
Confederation of Indian Industry.
Ratan Tata is retiring from the Tata Group's top job as he turns
75, a rule he himself framed. He, however, will remain as chairman
emeritus of Tata Sons. Cyrus Pallonji Mistry, 44, who was selected
by a panel of eminent people, succeeds him.
Mistry will be the sixth chairman of Tata Group in its 144-year
history and only second who does not carry the "Tata" surname.
Other people who held the position of chairman of the Tata Group,
apart from Ratan Tata, are: Jamsetji Nusserwanji Tata, Sir Dorab
Tata, Sir Nowroji Saklatwala and J.R.D. Tata.
Ratan Tata's departure from the iconic Bombay House in downtown
Mumbai marks the end of an era in which India looked outward and
its business went global.
(Gyanendra Kumar Keshri and Rohit Vaid can be reached at biz@ians.in)
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