Introduction of Tata Motors Ltd.
Tata Motors Limited is one of India’s largest and most respected automobile
manufacturers, headquartered in Mumbai, Maharashtra. Founded in 1945 as
Tata Engineering and Locomotive Company (TELCO), it initially produced
locomotives before expanding into the automotive sector. Today, Tata Motors
operates globally, manufacturing a wide range of vehicles including passenger
cars, trucks, buses, vans, and defence vehicles. It is a flagship company of the
Tata Group, renowned for its innovation, quality, and customer-centric
approach. Tata Motors owns global brands such as Jaguar Land Rover and has a
significant presence in over 125 countries. The company has pioneered
affordable and sustainable mobility solutions, such as the Tata Nano and electric
vehicles like the Tata Nexon EV. With a strong focus on research, design, and
eco-friendly technologies, Tata Motors continues to play a vital role in shaping
the future of the automobile industry in India and abroad.
History of Tata Motors Ltd.
Tata Motors Limited, originally established as Tata Engineering and
Locomotive Company (TELCO) in 1945, began by manufacturing locomotives
and engineering products. In 1954, it entered the commercial vehicle sector
through a collaboration with Daimler-Benz of Germany, producing its first truck
in India. The company expanded into passenger vehicles in 1991 with the
launch of the Tata Sierra, followed by popular models like the Tata Indica in
1998, India’s first fully indigenous car. In 2008, Tata Motors made global
headlines by acquiring the luxury brands Jaguar and Land Rover from Ford,
strengthening its international presence. The same year, it launched the Tata
Nano, the world’s most affordable car. Over the years, Tata Motors has
embraced innovation, entering the electric vehicle market with models like the
Nexon EV. Today, it stands as a global automotive leader, exporting to over 125
countries and shaping India’s mobility landscape for decades.
Comparative size statement
A comparative size statement is a financial tool that presents financial data of a
company for two or more periods side by side, enabling direct comparison. It is
commonly prepared in the form of a comparative income statement or a
comparative balance sheet. This statement highlights changes in figures over
time by showing the absolute amount, the increase or decrease, and the
percentage change. Such analysis helps identify growth trends, cost variations,
and financial stability. For instance, by comparing sales, expenses, and profits
across different years, management can evaluate performance and make
strategic decisions. Similarly, comparing assets and liabilities helps assess
financial position. Thus, a comparative size statement provides clarity on
financial progress, strengths, and weaknesses, supporting better
planning and control.
Common size statement
A comparative size statement is a financial tool that presents financial data of a
company for two or more periods side by side, enabling direct comparison. It is
commonly prepared in the form of a comparative income statement or a
comparative balance sheet. This statement highlights changes in figures over
time by showing the absolute amount, the increase or decrease, and the
percentage change. Such analysis helps identify growth trends, cost variations,
and financial stability. For instance, by comparing sales, expenses, and profits
across different years, management can evaluate performance and make
strategic decisions. Similarly, comparing assets and liabilities helps assess
financial position. Thus, a comparative size statement provides clarity on
financial progress, strengths, and weaknesses, supporting better
planning and control.
Cash flow statement
A Cash Flow Statement is a financial statement that shows the inflow and
outflow of cash and cash equivalents during a specific period. It provides a
detailed summary of how a company generates and uses cash through three
main activities: operating activities (day-to-day business operations), investing
activities (purchase or sale of assets and investments), and financing activities
(raising or repaying funds). By tracking cash movements, it helps assess a
company’s liquidity, financial health, and ability to meet obligations. Unlike the
income statement, it focuses on actual cash transactions, making it a vital tool
for decision-making and financial planning.
Conclusion of Tata Motors Financial Analysis (2021-22)
Tata Motors demonstrated mixed financial performance in FY2021-22, marked
by revenue growth but persistent profitability challenges. While total revenue
increased by 11.5%, the company faced significant margin pressures, with gross
margins declining by 104 basis points to 40.68% and operating margins
collapsing to just 0.75%. The automotive segment, particularly JLR,
experienced substantial margin erosion due to raw material inflation and supply
chain disruptions. However, positive developments included a 133.6% increase
in shareholder equity, 40.1% reduction in long-term debt, and improved net loss
position (-4.1% vs -5.4% previously). The cash flow position remained stable
despite a 50.7% decline in operating cash flows. Going forward, Tata Motors
must prioritize cost optimization in procurement and operations, accelerate its
EV transition to benefit from premium margins, and maintain its debt reduction
strategy. The company's ability to manage commodity price volatility and
improve operational efficiency will be crucial for achieving sustainable
profitability in coming years. Strategic focus on high-growth segments while
rationalizing underperforming operations could help turnaround performance.
Bibliography
1) www.google.com
2) www.youtube.com
3) www.datamotors.com
4) www.moneycontrol.com
5) www.scribd.com
