Brand Revival

With a massive rejig, Tata Sons chairman N. Chandrasekaran wants to ensure that the group companies focus on core businesses to build up scale, reduce debt and boost profits

- Nachiket Kelkar

A marathoner, Natarajan Chandrasekaran knows what it takes to get to the top in the long run. In February 2017, he took over as chairman of Tata Sons, the holding company of Tata Group. It was a period of tumult. Cyrus Mistry had been sacked from the post just a few months earlier following a spat with Tata Sons, and many of the group companies were firefighting. Chandrasekaran quickly got the group moving. In his first board meeting, a top priority he outlined was bringing the companies closer and leveraging their collective strength.

The $110-billion Tata Group is a diverse mix of companies, ranging from software services, consumer goods, metals, automobiles and jewellery to aerospace and defence. Chandrasekaran has been stressing on simplifying the group structure to bring these companies closer. That vision has now begun to take shape. The ‘One Tata’ strategy is straightforward—simplify the group structure, create synergies between companies and scale up.

In the new scheme, the group has been divided into 30 companies under 10 business verticals—information technology, steel, automotive, consumer and retail, infrastructure, financial services, aerospace and defence, tourism and travel, telecom and media, and trading and investments.

In the past, several Tata companies were engaged in the aerospace and defence sector. Tata Motors, for instance, was building specialised vehicles for the defence sector. Tata Power’s Strategic Engineering Division had partnered with the ministry of defence and the DRDO to manufacture night vision systems and missile launchers. Now, all defence-related businesses have been consolidated under the aerospace and defence vertical.