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Tata Group’s listed companies to be halved as part of N Chandrasekaran's plan to make it future ready

Other than the 29 listed companies, Tata Sons has nearly five dozen unlisted ones and hundreds of subsidiaries in 10 sectors. Under Chandrasekaran’s stewardship, the conglomerate has been merging businesses to unlock synergies and efficiencies. The conglomerate last week announced the consolidation of its steel business by merging seven subsidiaries into Tata Steel.

ET Now Digital

Updated Sep 26, 2022, 09:02 IST

New Delhi: From 29 to an estimated 15, the over 150-year-old Tata Group aims to bring down the number of its listed companies and has already started plans for the same. The move is part of chairman N Chandrasekaran's stated plan of transforming the country's oldest conglomerate to make it future ready.

With the reduction in the number of listed companies, Tatas will focus on investing in fewer but bigger entities that can ably compete in the marketplace. Just last week, the Tata Group announced the consolidation of its steel business by merging seven subsidiaries into Tata Steel.

Tata Sons, which $128 billion revenue and $255 billion market cap, is hastening its simplification and synergising strategy to better focus on growth and scale and improve cashflows in the larger companies, executives close to the development told Economic Times.

Fewer listed companies will also reduce a lot of management time and effort that's put into smaller companies, they added.

Prior to announcing the mega Tata Steel merger, Tata Consumer Products, in March, announced the merger of all businesses of Tata Coffee with itself.

"The move is long overdue and needless overheads and costs in the system will be eliminated. Several such small entities were created and listed with some specific needs at that point of time. Today, scale and cost optimisation will help efficient deployment of capital and resources," said one of the officials cited above.

Consolidation of Tata businesses

A year after Chandrasekaran’s appointment as Tata Sons chairman, Tata Sons consolidated its various businesses in the aerospace and defence sectors under a single entity-Tata Aerospace & Defence in 2018. In 2017, CMC was merged with Tata Consultancy Services. In technology, the group now has three major companies--Tata Consultancy, Tata Elxsi and unlisted Tata Digital.

In the automobile sector, the conglomerate has three listed companies--Tata Motors, Automotive Stampings & Assemblies Ltd, and Automobile Corp. of Goa Ltd. Tata Autocomp Systems is unlisted.

Moreover, by bringing Tata Projects, Tata Consulting Engineers, Tata Realty and Infrastructure, and Tata Housing under a single umbrella, the group plans to create a larger infrastructure vertical.

In its airline business, the conglomerate is already planning to consolidate AirAsia India, Vistara and newly acquired Air India under the Air India brand by 2024.

"The group is also betting on new areas of growth and future businesses, and efficient capital allocation is imperative to build large competitive companies," said a top group official.

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