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Last Updated : Jan 22, 2018 08:48 PM IST | Source: CNBC-TV18

Davos 2018: Confident of India story & growth revival, says, N Chandrasekaran

Speaking to CNBC-TV18's Shereen Bhan at Davos 2018 where the World Economic Forum is set to kick off, Chairman of Tata Sons, N Chandrasekaran said, "2018 will be a year of restructuring and growth."

CNBC TV18 @moneycontrolcom

Speaking to CNBC-TV18's Shereen Bhan at Davos 2018 where the World Economic Forum is set to kick off, Chairman of Tata Sons, N Chandrasekaran said, "2018 will be a year of restructuring and growth."

Below is the verbatim transcript of the interview.

Q: Last year, when you were here, the announcement of your taking over had been made. You had not officially taken over. It has been quite a year since then. Before I talk to you about Davos, let me ask you about the year that has been at Tata Sons?

A: It has been a good year, a year full of satisfaction. We have embarked upon a number of initiatives. We have looked at building the right team and as I mentioned to you in your interview, we had identified the important issues to put behind and we have addressed some of them, rather the most critical, telecom, then we have addressed steel and all these transaction will contour in 2018. Then we are systematically going about restructuring some of the other businesses and also, we just announced our expansion of our steel business. We cleared about Rs 25,000 crore of investment for expansion in Kalinganagar over the next 3-4 years. We are looking at stressed assets and we are doubling down on Tata Motors. We are work in progress with respect to the themes of simplification, synergy and scale.

Q: So in a sense, 2017 was a year of review assessment. 2018 is likely to be the year of restructuring, so to speak?

A: It will be a combination of restructuring as well as focusing on growth. Clearly, we have 6-7 verticals we have identified apart from steel, motors and TCS. Definitely consumer and retail, financial services and infrastructure.

Q: The market seems to be excited about the consumer facing businesses in hope and anticipation that there is going to be some significant changes there. Is that accurate?

A: We are looking at it very deeply because there is a significant opportunity for the group considering the brand and the consumers that we already have, a very large customer base. There is a lot of synergy. So we are looking at that and we are also trying to see how we can leverage digital in that segment and other segments. So, lots to do.

Q: So what would be the priority when it comes to the consumer facing businesses? For instance whether it is Tata Global Beverage or it is your retail business, etc. what is the overarching vision that is going to define the way that you go about these businesses?

A: Each one of these areas will definitely have the same themes play out, simplification will be a theme that will play our, consolidation will be a theme that will play our wherever it is possible.

Q: Is it possible in the IT businesses because that is the question that I last asked you and that seems to be again something that the market is anticipating, whether it is Tata Elxsi and so on and so forth. There is a lot of activity around those stocks.

A: In the IT business, TCS is a very large player and other players we have are small and they are focused on niches and that is not an area I am ready to comment upon. But in many of the other businesses like consumer retail, etc. we need to see because some are listed companies, some are unlisted companies. So how do we bring the power of the group together is something that we are looking at, multiple options.

Q: Did you start addressing the crossholding issue as well in 2018?

A: Simplification means many things and crossholding is one of them which we have done quite a bit and whatever left, we will complete. Consolidating is another option.

Q: Which is the vertical that you see ripe for consolidation, most ripe for consolidation today or need for?

A: Whether it is ripe or not, the verticals, consumer retail and infrastructure, these are areas where there is a lot of opportunity and we need to pay attention which we are looking at.

Q: Let me ask you about the outlook as far as growth is concerned. 2018, by all accounts, indications are that green shoots are starting to show up. How confident do you feel about growth and the India story?

A: I think I am very confident. India is poised for fantastic growth in 2018 and 2019 and beyond. Many of the actions, the policy framework that government has put in place, whether it is GST, whether it is the bankruptcy code or some of the other initiatives like Digital India, etc. will all play out because they are very structural reforms and I expect to see significant growth. We are already seeing it. If you see our commercial vehicles market or if you see our presence, even companies like Titan, many segments we see, we already see there is tremendous opportunity for growth.

Q: How satisfied are you with where things are at Tata Motors because that again was a focus area that you spoke of in October, when we last met.

A: What we have done this year, I am extremely happy. The focus that we have brought in terms of commercial vehicles that we really are going for market share gain as well as operational improvement is working very well and passenger cars is also doing very well. Tata Motors domestic market has been an area where there has been a lot of action and I am pretty happy with where we are but long way to go.

Q: The Prime Minister is going to be here addressing investors. What, to your mind is going to be the key message that investors want to hear from him, domestic or foreign? And ahead of this, we saw another bunch of foreign direct investment FDI proposals being cleared by the cabinet including 49 percent in Air India ostensibly to pave the way for its disinvestment. Is your partner, are you ready now with a formal expression of interest for Air India?

A: I do not want to comment on any specific proposals, but as I said, the reforms that have been put in place over the last three years are pretty significant. All of them are ready to play out. They are very structural in nature. The only message I would feel that will be required is to reinforce that we will make policy changes, we will continue on the path, we will do the right thing in order to address the core issues that face the country and we are on a path and we will continue on that path, reinforcement of that.

Q: Air India?

A: I am not ready to comment on it at this point.
First Published on Jan 22, 2018 08:10 pm
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