Tata Motors

Content

1. Corporate Overview Established in 1945, Tata Motors is India's largest automobile company. The company operates from 29 regional sales centers and has a network of over 500 independent dealer outlets. 1.1 Corporate History In 1945, Tata Motors established In 2005, tat Motors acquired 21% stake in Hispano Corrocera 1.2 Key Facts Net Sales (2005)-US$4.55 billion Net Income (2005)-US$304.1 million 1.3 Key Subsidiaries / Affiliates 1.4 Organizational Chart 1.5 Profiles of Key People Chairman- Rattan Tata Managing Director- Ravi Kant 1.6 Recent Developments In August 2006, Tata Motors forays into the Russian market In July 2006, Tata Motors and Fiat Group enter a joint venture 2. Business Description 2.1 Business Segments Commercial Vehicles Passenger Vehicles 2.1.1 Products/Services 2.2 Geographical Segmentation In FY05, International Sales for Tata Motors were to the tune of 13.8% of the total revenue 2.3 Key Partnerships/Alliances Marcopolo A 51:49 joint venture for mass production technology of buses Daewoo Commercial Vehicles Company In 2004, Tata Motors acquired the Daewoo Commercial Vehicles Company 3. SWOT Analysis 3.1 Strengths Strong presence in the commercial vehicle market Brand recognition High investment in R&D Wide distribution channels 3.2 Weaknesses Limited product portfolio in the passenger segment Operations mainly restricted to India 3.3 Opportunities Increasing demand for cars in India Expansion in international markets 3.4 Threats Increase in prices of raw materials Intense competition from global players 4. Key Business Strategies Ambitious Capex Plans for Growth Focus on Key Subsidiaries Expanding Presence in Overseas Markets Focus on the Bus Market Plan to Streamline Production Joint Venture to Upgrade Technology 5. Financial Performance 5.1 Financial Highlights In 2005, Tata Motorss revenue increased by 23.2% y-o-y, while Operating Income increased 24.6% y-o-y in the same year. 5.2 Five-Year Financial Summary Tata Motors revenue reached US$5.4 billion in 2005 at a CAGR of 37.7% from US$1.5 billion in 2002. 5.3 Ratio Analysis The companys operating and net margins improved slightly despite the significant cost increase pressures. The company was able to maintain its margins through its continuous cost reduction drive. Performance Ratios - In FY05, LOreal reported 8.4%ROA and 13.7% ROE, improving by 1.3 points and 1.5 points, respectively over FY04. 5.4 Market Indicators 5.4.1 Stock Chart 5.4.2 Earnings Estimates The sales figures of Tata Motors is expected to increase to US$7.5 billion by 2009, while the net income is expected to increase to US$578.5 million during the same period. 6. Competitive Landscape 6.1 Industry Overview 6.1.1 Industry Definition and Segmentation 6.1.2 Key Drivers Continued Road Development Ban on Overloading to Spur Commercial Vehicle Demand Low Penetration Level of Passenger Cars Growing Urbanization A Burgeoning Middle Class Better Financing Options 6.1.3 Major Trends Young Generation Fueling Car Sales Increasing Presence of Foreign Car Makers 6.1.4 Outlook Automakers in India plan to quadruple total sales to US$145 billion by 2016, compared to US$36 billion in 2005, targeting 16% annual growth. 6.2 Competition Mahindra & Mahindra Maruti Udyog 6.2.1 Competitive Positioning Tata Motors holds 61% share in domestic market for Commercial Vehicles. 6.2.2 Geographical Coverage Maruti Udyog has the highest percentage of its operations in the domestic market at 93.8%. 6.2.3 Client Base 6.3 Financial Assessment In 2005, Tata Motors had the highest CAGR of 37.2% among its peers. 6.4 Stock Market Performance As of August 2006, Mahindra & Mahindra had the highest performing stock among its competitors. 7. Outlook 7.1 Company View In FY07, the company has planned further increase in commercial vehicle sales by launching new products in the cargo as well as passenger segments. 7.2 Analyst View Tata Motors CV portfolio is expected to post a CAGR of 16% over during 2006-2008, driven largely by the LCV segment. Appendices Appendix I Consolidated Profut & Loss, 2005-2006 Appendix II Consolidated Balance Sheet, 2005-2006 Appendix III Mergers & Acquisitions/Divestiture (2000-2006) List of Tables/Figures Table 1.1 Key Facts Table 1.2 Key Subsidiaries/Affiliates Table 1.3 Profiles of Key People (2005) Table 1.4 Recent Developments (2006) Table 2.1 Variants of Tata Motors Commercial Vehicles Table 2.2 Variants of Tata Motors Passenger Vehicles Table 2.3 Key Partnerships/Alliances (2004-2006) Table 3.1 R&D Investments (2000-2005) Table 4.1 Capex Breakdown Table 4.2 Q107 Performance of Subsidiaries Table 5.1 Financial Highlights (2005-2006) Table 6.1 Demographic Segmentation of Car Owners (2005) Table 6.2 Leading Players in the Indian Automotive Industry (2005) Table 6.3 Competitive Positioning Table 6.4 Client Base Table 7.1 Segment-Wise Sales Volume Forecast (FY2006-FY2008) Figure 1.1 Organizational Chart Figure 2.1 Volume Mix (FY2006) Figure 2.2 Revenue Share by Geography (FY2004-FY2006) Figure 3.1 Commercial Vehicles Sales and Market Share Domestic (2002-2006) Figure 5.1 Revenue Growth (2002-2006) Figure 5.2 Operating Income Growth (2002-2006) Figure 5.3 Net Income Growth (2002-2006) Figure 5.4 Profitability Ratios (2005-2006) Figure 5.5 Performance Ratios (2005-2006) Figure 5.6 Stock Performance (Sep2005 to Aug2006) Figure 5.7 Earning Estimates (2007-2009) Figure 6.1 Industry Segments Figure 6.2 Urban Population (1951-2001) Figure 6.3 Growth in Income Groups (1996-2005) Figure 6.4 Indian Automakers Sales (2005-2016) Figure 6.5 Geographical Segmentation (2006) Figure 6.6 Revenues (FY2006) Figure 6.7 Net Income (FY2006) Figure 6.8 Stock Market Performance (Sep 2005-Aug 2006)