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Mumbai/Bengaluru: In his letter to shareholders, Tata Sons Ltd’s ousted chairman Cyrus Mistry referred to the various hurdles each group company faced—ranging from competitive intensity and poor decisions to lack of quality control and investment support. He explained how companies rose to address these challenges under his tenure.

On Tata Consultancy Services Ltd, or TCS (extraordinary general meeting or EGM date: 13 December)

While saying he was satisfied with TCS’s current management team, Mistry reminded shareholders how under his watch, TCS started to make itself future-ready in the face of newer technologies such as cloud computing. He highlighted initiatives such as a digital strategy, which included building the company’s artificial intelligence-powered platform, Ignio, setting up an innovation lab in US and reskilling over 120,000 employees last year. TCS in the past four years also improved its ability to generate more cash, as the country’s largest software services firm improved cash conversion from 49% in 2012 to 92% in 2015. Growth at TCS has slowed in recent quarters and there is no mention of the reason behind this slow growth in Mistry’s letter to shareholders.

On Indian Hotels Company Ltd, or IHCL (EGM date: 20 December)

Mistry said IHCL was left with almost no investment to support the domestic market as capital was stuck in several “cash-guzzling assets". This included expensive overseas acquisitions such as the New York-based Pierre Hotel that was “bleeding", the Sea Rock hotel project which was stuck, blocking capital, while several assets including the Taj Mansingh in Delhi had litigation risks.. His strategic priorities included bringing a new leader with strong domain experience, developing a “long-term pragmatic view of assets that continued to generate negative returns" and simplifying the holding structures and repatriating cash “to create a healthier balance sheet." So, IHCL sold and divested some assets abroad to retire debt and infuse liquidity, which will help in renovating and upgrading flagship properties in India, the letter said.

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On Tata Steel Ltd (EGM date: 21 December)

Mistry talked of a better safety record, cost optimization and productivity improvement under his watch. He cited the example of Kalinganagar steel project’s turnaround, saying that it was only 11% complete in 2012 and started production by May 2016. The focus has been to sell differentiated steel products and deliver cost savings, the letter said, adding that restructuring has led to better productivity. Insinuations about looking at UK operations through a short-term lens are untrue, as evidenced by continued management attention and investments devoted to these assets, the letter added. Mistry believes that given the strong performance of the India business, and if a long-term structural solution to the global business is found, then Tata Steel is well poised to deliver long-term profitable growth.

On Tata Motors Ltd (EGM date: 22 December)

Mistry highlighted the competitive intensity that hurt Tata Motors Ltd’s passenger cars and commercial vehicles business and how the company faced gaps in manufacturing, supplier quality processes and lack of quality assurance protocols during the product development process. He said a thin product pipeline and constant changes in top management hurt the company. Under Mistry’s leadership, the company launched the compact car Tiago, and Prima and Ultra range of trucks, the letter said. Tata Motors now plans to unveil a new platform strategy and has taken initiatives to handle high attrition in its sales force and poor dealer profitability. Tata Motors too plans to unravel its cross-holding in group companies and exit from unrelated businesses to generate funds for growth, the letter said.

On Tata Chemicals Ltd (EGM date: 23 December)

Mistry said the investments in Kenya and UK plants of Tata Chemicals Ltd faced technical challenges, raw material issues and high cost of production. Its Haldia plant continues to lose money and a number of new businesses the company ventured into were bleeding. He said the company undertook a series of strategic interventions, which focused on transitioning from traditional, asset-intensive, commodity chemicals and regulated fertilizers play to building a more knowledge-intensive, consumer and specialty chemicals company that leveraged the strong cash flow of the soda ash business. The company also sold assets and introduced new consumer products which helped improve profits and return on capital employed.

ALSO READ: Ratan Tata insecure about his legacy: Cyrus Mistry to shareholders

On Tata Power Co. Ltd (EGM date: 26 December)

Mistry highlighted his strategy for Tata Power was to generate funds by unravelling cross-holdings in group companies and exiting unrelated businesses. His letter talked about “the overwhelming threat to its survival" from the Mundra plant in Gujarat. After several initiatives undertaken by the management, losses reduced to Rs306 crore in fiscal 2016, Mistry said. He added that the management identified renewables as a key area to increase generation capacity, and Tata Power also partnered with ICICI Venture Funds Management Co. Ltd for investing up to $850 million in stranded power projects in India. Mistry said Tata Power has focused on operational improvement and cost-cutting programmes in its Trombay business by bringing on board a cost-efficient vendor through a transparent global tendering process, which was key factor in renewing its Mumbai licence for another 25 years.

shailaja.s@livemint.com

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