TATA: CHANDRA TAKES CHARGE

in the first half on Tuesday, 21, February, the board of Tata Sons will meet at the board room at Bombay House, the conglomerate’s iconic headquarters in South Mumbai.

Interim chairman Ratan N Tata, 79, will chair the meeting, which has been called to mark Natarajan Chandrasekaran’s “assumption of charge”, as a Tata spokesperson puts it.

The 53-year old Chandrasekaran will be the first chairman of the $103-billion Tata Group with no family-links to the Tatas, although he has spent all his working life at one company, Tata Consultancy Services. He takes over even as the holding company is in the midst of a legal battle with former chairman Cyrus Mistry who was ousted on October 24.

Within the Tata Group, the belief is that Chandrasekaran “will hit the ground running,” one executive who asked not to be identified, adding that he will likely “first take a hard look at all the difficult companies.” There he is spoilt for choice. Tata Steel Ltd, Tata Power Co Ltd, Tata Chemicals, Indian Hotels and Tata Teleservices are all in trouble, earning sub-par returns or making losses. Tata Sons is heavily dependent on dividend from TCS. In 2015-16, Tata Motors Ltd and TCS accounted for more than half of the group’s combined revenue, 69% of operating profit, 100.5% of net profit and 80% of all equity dividend paid. Excluding TCS and JLR operations of Tata Motors, the group reported a net loss of ₹160.7 crore.

“I want him to do something that the group doesn’t like. Close down part of the traditional part of Tata Group that is not doing much for the group,” Aswath Damodaran, professor of finance at the Stern School of Business, New York University said in an interview on January 20.

Still, there is no denting that Chandrasekaran’s appointment has soothed the market. The new chairman was named on 13 January. Between then and now, the group’s market capitalisation is up 4.31% at ₹8.45 lakh crore.